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If talk about currencies, network systems and internet security is something that scares you, then you are about to have your mind blown.
This week’s episode of London Real brings you Andreas Antonopoulos – technologist, serial entrepreneur and world Bitcoin expert.
If you’ve heard of Bitcoin you may still believe this digital currency is only used by drug-dealers, terrorists and pornographers.
Andreas addresses the bad press Bitcoin has received and is adamant that it’s about to change.
As he points out, this is part of the journey of any new cutting edge technology.
The big paradox at the heart of Bitcoin is that it simulates a coin made from precious metal, i.e. it’s rare.
It doesn’t immediately make sense to have a digital ‘thing’ be rare, as everything in the digital world can be copied ad infinitum.
Confused? Well, you’ve come to the right place!
Andreas’s genius is in making complex economic and digital concepts understandable.
If you are baffled by how a currency that trades in the real world can simply be invented from scratch in the ether of the internet, don’t worry, it’s all here.
During the episode, Andreas lead us from his first discoveries of Bitcoin to his now widely accepted expertise, and his evangelism for the currency.
Andreas insists, however, he is not selling Bitcoin.
He simply wants to open up the dialogue about the future of money, and reveal to ordinary people the scope of the technology.
As Andreas says, he’s not in this for the money. He is in it because he loves having “a front row seat in the making of history“.
One thing that might surprise you about Andreas is how approachable and likeable he is.
For a guy who spends his life talking about computer systems and economics, he’s remarkably easy to communicate with.
He’s candid, passionate about what he does, and his optimism about Bitcoin is infectious.
Even if you struggle with talk about currencies, computer networks and financial security, you’ll come away from this week’s episode a believer.
Andreas not only cares about Bitcoin, he cares that YOU care also.
Tune in to watch a fascinating person unravel the cutting edge of money in the digital age.
How Andreas got started with bitcoin? Background in distributed systems, networks, and securities. [8:18]
Why the early systems tried and failed – centralisation was the weak point. [9:50]
Working for banks and then the financial crisis happened. [10:20]
Running a company and being a partner in an analyst firm. [10:30]
I wasn’t interested in gambling therefore I missed it. [11:00]
Why Andreas read the Satoshi Nakamoto white paper. [11:20]
Boom in my head. This is not even a currency. Its a network that solves distributed consensus. This is huge. [11:45]
Who is Satoshi? Global consensus on a distributed ledger without any central authority. [12:00]
Why it’s much more than a currency. [12:50]
What is the blockchain. [12:30]
In 1992, you may make the obvious mistake that email is the internet. Confusing the application and the platform. [13:50]
Bitcoin is not money for the internet it is the internet of money. [14:20]
I dropped everything for 4 months. Losing 26 pounds in 4 months. To eat I had to stop reading. [15:00]
Its a never ending journey of discovery. Bitcoin today is not bitcoin of 2009. [16:12]
Bitcoin suffers from a marketing problem. Why are criminals the earliest adopters of technology? Because they face the highest degree of friction. [17:00]
The cat video industry. Bitcoin morphing into more normal activities. [18:50]
That is the only association the media wants to write about it. Click bait headlines. [19:17]
Governments are happily promoting the association with criminal activities and piling on the propaganda. [19:30]
Ross Ulbricht, founder of silk road and the hit he put out. 2 DEA agents plead guilty of stealing money and orchestrating the hit. [19:41]
The most corrupt character in that episode was a drug cop. [20:45]
It is important to understand why was the Silk Road so popular? [21:18]
You can’t get stabbed over TCP/IP. [21:40]
Drug addiction. Prohibition created the mobster in America and caused corruption, violence and cartels. [22:05]
Selling cigarettes and alcohol to avoid tax.[23:20]
For addicts the real issue of violence is solved by an online marketplace. [23:38]
The Silk Road was the best peer reviewed marketplace around. The best quality and the best repeat business. [23:58]
Using escrow services like Ebay with Paypal for dispute resolution. [24:30]
Contract based solution to what is normally addressed by violence in the market. [24:50]
You can’t solve the health issue, you just end up corrupting the law enforcement. [26:05]
Did the Silk Road help get the word out about Bitcoin? [26:15]
How’s your life evolved in the last 2 years since you first started talking about it. [27:10]
Public speaking and explaining technology to people. [27:40]
Talk about Bitcoin and help explain it to people. [28:25]
Does the interest in Bitcoin track with the price? [29:30]
2000 was simultaneously the internet’s death and its rebirth. Creative process in capitalism. [30:40]
The 4 crashes of Bitcoin. [31:05]
1000th of a penny to $1. Parity was a holy grail. [31:44]
The idea that you can bootstrap a global currency was itself a crazy idea. [32:20]
By the way, we have at least 3 or 4 more bubbles. [32:33]
The double edge sword of having a single price. [33:10]
The limits to the number of Bitcoins and the scarcity affect. [34:08]
Sets of rules that guarantee the scarcity in the system. [34:44]
Extraction of gold and the process of diminishing returns. [35:40]
Bitcoin miners can’t change the rate of issuance because that is fixed by the network. [36:18]
Miners competing to produce security to the network and get rewarded a share of bitcoin. [36:30]
The real invention is the ability to agree what the state of the ledger was worldwide. [36:53]
The purpose of mining is to secure the consensus to agree what is on the ledger. [37:02]
Approximately 14 million bitcoins has already been mined. [37:28]
There will ever only going to be just short of 21 million. [37:34]
The units are arbitrary so each bitcoins can be divided. [38:00]
Is that the hardest part of what you do? [38:35]
Currency works best when there is less volatility. [38:50]
220 and 260 Dollar/Bitcoin in the last 6 months. The euro has been more volatile than Bitcoin. [39:00]
Using Bitcoin for transaction of exchange rather than a store of value. [39:50]
How volatility affects people. Only over long periods of time. [40:28]
How much of your life can you live on Bitcoin? [40:36]
Buy plane tickets, pay hotel room, buy consumer goods, electronic. [40:40]
In 1993, how much of business can be done over email? [41:08]
Takes time for the adoption to become seamless and comfortable. [41:20]
It took 20 years between the day I sent my first email and when my mum sent her first email. [41:30]
Bitcoin is 6 years old, all the potential is there and it refuses to die. [42:00]
The marketing coup of bitcoin. Let’s now call it blockchain. This transition happened because of banks. [42:20]
People did the transition because they were uncomfortable of the connotations. [43:10]
Paypal is transacting Bitcoin now. Uber not yet. [43:20]
The sharing economy is a great opportunity for bitcoin. [43:41]
Very cumbersome cross border transactions – 3 categories. [43:50]
Companies that need to pay suppliers and subcontractors across the world. Outsourcing partners. [44:00]
Import export using trans national currency. [44:20]
Foreign remittances. 100 million immigrants send 560 billions dollars home every year via companies like Western Union and Money Gram. An enormous source of income for some of the poorest people in the world. [44:45]
Giving the money directly to the women in the poorest countries and they will take every single dollar and create 5 dollar of investment in clean water, sanitation, healthcare, education, food which has an enormous leverage impact on poverty. [45:53]
What if the Nokia 1000 in the hands of 4 billion people was also a banking terminal, a loan origination terminal a remittance terminal, an international credit terminal, an equity trading terminal, an import export trading terminal? [47:01]
A solar panel on a hut is used to charge to only cell phone in the village. [48:03]
That is why I am in bitcoin. [48:20]
Linking the mobile payment systems in Kenya, Tanzania, Ghana, Uganda and Nigeria with international remittances through bitcoin. [48:40]
Setting up links between the top remittance corridors of the world – US and Mexico, US, UK and Philippines, UAE, Saudi Arabia and India. [48: 50]
A solution that works will draw a lot of attention. [49:30]
Peter Thiel in Zero to One – improvement factor of an order of magnitude. Coin base receiving a large VC funding. [49:36]
Approximately a billion dollars was invested in 750 startups in 2015. [50:20]
Funding rate that is higher than the funding rate of the investment in the internet in 1995. [51:00]
Brain drain from the financial industry. Quants, high frequency trading, algorithmic trading math whizzes are like “What is this? Programmable money, Sign me up.” [51:20]
Half of Silicon Valley is migrating into Fintech in a rush. [51:45]
There are dozens of Bitcoin startups doing really interesting things here in London. [52:00]
Bitcoin is open source technology. What happens when 75% of these startups go under? [52:20]
Apple Pay and Facebook encouraging transfer of money. [53:50]
Training consumers on the idea that the mobile device is a payment device. [55:00]
Now there are dozens of bitcoin wallets. [55:20]
Aol and Compuserve competed with the internet in a closed wall garden. [55:40]
They couldn’t compete in an open innovative environment. [56:28]
Africa will get debanked on Andriod 25 dollar phones with a bitcoin wallet and no bank. [57:15]
How do you choose where to get involve in Bitcoin? [57:50]
People respect my independance and my integrity. [58:30]
I’m not in this for the money. I effectively suck at it because I’m broke. Nobody is paying me to do this. I have a front row seat in the making of history. [59:20]
My goal is about education of bitcoin technology. [1:00:05]
A lightning rod for certain types of individuals. [1:00:40]
Having a big mouth and have opinions and I say things. [1:01:02]
Its not about me, people get excited about bitcoin. [1:02:05]
Bitcoin presents a blank canvas and a lot of people project their own worldview, expectations and desires on it. [1:02:16]
Bitcoin is the lightning rod, I am the conductor. Some of the strikes go through me and I get flacked. [1:02:34]
The bitcoin community I have met… [1:03:09]
The Greek financial crisis is a demonstration of the failure of the central banking and bad governance. [1:03:48]
You can’t assign character flaws to an entire nation. [1:06:10]
Nobody is moralising against the banks. That is I think unfair. [1:07:40]
Greece isn’t ready for bitcoin. You need infrastructure, education, technology support. [1:07:48]
The idea of a monetary crisis that takes an entire population hostage is no longer viable. [1:09:05]
With bitcoin there are no bail ins, no bank holidays, no seizures, no currency controls, noone can stop you, censor you, take away your money, stop you from spending it. [1:09:39]
Not all but a lot of Venezuelans and Argentineans do know that this is a solution. [1:10:10]
The Italians, Spanish and Irish should be paying attention. [1:10:15]
People suddenly had choice and freedom. We are now doing it with money. [1:11:03]
The craziest experiment is not bitcoin, its the 21 central banks that took interest rates to 0% left it there for 6 years and cannot raise it again. The most radical monetary policy experiment. [1:11:45]
We are running out of cocaine and there will be a hangover. [1:12:45]
20 years from now what is the cryptocurrency space going to look like? [1:12:56]
Foundational institutions to society changing radically. [1:15:56]
Micropayments to piccopayments. A millionth of a penny for 200 millisecond slice of service. [1:16:32]
You can be software and you can own money. Bitcoin doesn’t require personhood for ownership of money. [1:17:00]
Uber, bitcoin and self driving cars. Self owning taxi. [1:17:27]
2-4 billion people are cut off from finance and 5-6 billion people are cut off from international finance. What happens to the economy when you bring 6 billion people online? [1:19:15]
Even in a developed country where can you invest your money? Because nothing is productive. [1:20:00]
Banking as a series of brick and mortar, high overhead, high margin services is not scaleable. [1:21:20]
Banking as an app backed by a networked based currency and system of trust scales enormously. [1:21:35]
Bankers in Brazil sharing how people are 100 miles upstream by canoe in the Amazon basin to the nearest bank branch but there are cell phone towers and Nokia phones. [1:22:05]
Personal success secrets that changed Andreas game? [1:23:00]
Advice to the 20 year old Andreas. [1:29:30]
Best advice you’ve ever received. Did you receive training in writing or speaking? [1:30:12]
What should I do in Bitcoin? What is the things that drive you? [1:31:27]
Advice to the 20 year old to advance the course of cryptocurrency. [1:33:18]
We need to make bitcoin really easy to use and more secure. [1:34:50]
Explain the benefit, demonstrate it, let people experience it and let time take its toll. [1:35:05]
There will be an endless set of disappointment from banks and national currencies. [1:35:30]
What its like to be on the Joe Rogan show 3 times? [1:36:00]
Connect with Andreas Antonopoulos
Andrea’s book – Mastering Bitcoin
Selected links from this episode
David Choam https://en.wikipedia.org/wiki/David_Chaum
Satoshi Nakamoto white paper Bitcoin: A Peer-to-Peer Electronic Cash System https://bitcoin.org/bitcoin.pdf
Click bait headlines https://en.wikipedia.org/wiki/Clickbait
Jimmie Bartlett – The Dark Net – Inside The Digital Underworld http://www.amazon.co.uk/The-Dark-Net-Jamie-Bartlett/dp/0434023159
Bitcoin obituaries http://bitcoinobituaries.com/
Western Union https://en.wikipedia.org/wiki/Western_Union
Money Gram https://en.wikipedia.org/wiki/MoneyGram
Nokia 1100 phone https://en.wikipedia.org/wiki/Nokia_1100
Peter Thiel – Zero to One https://en.wikipedia.org/wiki/Zero_to_One
Andreessen Horowitz https://en.wikipedia.org/wiki/Andreessen_Horowitz
Greek Financial Crisis https://en.wikipedia.org/wiki/Greek_government-debt_crisis
Joe Rogan Experience #446 https://youtu.be/1cexawnOlR8
Joe Rogan Experience #490 https://youtu.be/EnhGlgCm4MU
Joe Rogan Experience #581 https://youtu.be/5wwbzwUXfgc