Kind: captions
Language: en
foreign
[Music]
currencies with names like Bitcoin
ethereum and Dogecoin today there are
thousands of them but what are they and
how do they work you can't hold it often
you can't spend it we're looking at
something that is 20 a working
technology and eighty percent a utopian
vision of how Society could be
are they a flash in the pan the future
of crypto is at 99 of projects will be
rendered useless or a new technology
that's here to stay it's not going to
vanish what it's used for is yet to be
fully determined the art world has been
turned upside down again
you have built a functional replacement
for a lot of what a credit card company
or a bank does decoding crypto right now
on Nova
[Music]
Revolution game changer I'm a
millionaire experiment doomed to fail
the future of crypto is at 99 of
projects will be rendered useless the
Carnage and the crypto World continue
today it is impossible to understand
where this is going there's no question
cryptocurrency is having a moment
Bitcoin is a new kind of money nfts are
sweeping the art world cryptocurrency is
a trillion dollar market it cannot be
ignored what is crypto anyway you can't
hold it often you can't spend it
technologically it's incredibly
interesting cryptocurrency kiosks are
appearing Nationwide crypto is a global
phenomenon adopted by countries embraced
by refugees and used by millions around
the globe most people have heard of
Bitcoin the most well known among
thousands of cryptocurrencies but find
it confusing everything you don't
understand about money combined with
everything you don't understand about
computers it's talked about all the time
by people who claim to be in the know
I'm getting into crypto with FTX you in
investors and speculators have both made
and lost great deals of money but it's
not at all just about money it has a lot
of different applications many of which
have very little to do with financial
services some warm of possible perils
there's a lot of hucksters out there who
are just trying to sell their snake oil
fraudsters are buying and selling
millions of dollars in illegal digital
assets While others claim crypto is a
groundbreaking technology with nearly
unlimited uses
the Constitution of the United States is
going up on auction sold 41 billion
dollars whether it's a movie or it's our
housing contracts uh and market for
climate action
where did it come from this is one of
the most significant Technologies to
have been created by someone who is
still wholly anonymous
how does it work it was just like whoa
that's amazing is it just hype crypto
has been embraced by the mainstream but
not in a way that achieves any of its
original goals or is it revolutionizing
money and more it's a safe and easy way
to get into crypto
yeah I don't think so
[Music]
real estate investor Vernon J is trying
to use a new kind of money to
reinvigorate East New York Brooklyn
he thinks crypto could be the key to
expanding ownership in neighborhoods
like this one
this may not be what most people think
of when they hear cryptocurrency
but some people believe ideas like his
represent crypto's true potential
what's going on brother good yeah this
is it this is it let's just check it out
let's do it Vernon and his business
partner computer programmer Akil Ash
planned to reclaim properties like this
vacant lot to build affordable housing
owned and managed by people who want to
improve the neighborhood we hope to get
community members to be able to invest
with us where people from the community
can own fractions of the property can
gain access to the income from that
property forever each token is worth a
hundred dollars rather than go to a bank
for a loan Vernon is going to use a new
Financial technology to Mint something
called a digital token which can be
bought and sold in a digital Marketplace
so these are the equity coin investors
so these are their wallet addresses
where they got sent their Equity coin to
Vernon's project known as Equity coin is
a risky experiment and success is far
from assured
if it succeeds the community may benefit
you'll be able to restore this it
doesn't need if it fails he and his
investors could lose real money
today there are thousands of
cryptocurrencies launched by
entrepreneurs coders even artists
among them are passionate Advocates who
believe their projects are evidence that
crypto has the potential to address a
wide range of society's problems
but that potential has yet to be
realized
when we look at a technology like
cryptocurrency we're looking at
something that is 20 a working
technology and eighty percent a utopian
vision of how Society could be
the technology is several steps ahead of
where the regulatory infrastructure is
many most or all are doomed to fail
there have been accusations that all
crypto is a Ponzi scheme what I would
say is that there are tokens and
projects where the token will ultimately
wind up having no value I do think
however there is a period of time in any
Innovation where you just have to figure
it out and you're going to have to throw
a lot of things at the wall and see what
sticks we're in that time right now
supporters claim crypto is superior to
traditional money
but to understand why
it's best to start with a deceptively
simple question
what is money anyway
has come in many forms throughout human
history and while we are all very
familiar with coins and banknotes many
other objects have circulated and been
used in exchange
this is part of the largest historical
collection of money in the world located
at the Smithsonian museum in Washington
DC the value of money exhibit features
hundreds of objects representing
currency from every inhabited continent
spanning more than three thousand years
they range from
seashells
large metal plates
clam shells large Stone discs often
known as Rey from the island of Yap
really anything can be used as money as
long as the community agrees to use it
and decides on a value
money has existed in one form or another
for longer than written history
but the fact it takes so many forms
raises another interesting question
how real is any of it
all money is collective belief right
money that you alone believe is valuable
is no more useful to you than a language
that only you speak
money relies on the ability of large
groups of people to arrive at a shared
consensus about how much something is
worth and that it will be worth that
more or less into the future
there are some elements of you know is
this a good form of money can it be
transacted easily can it be transported
is it going to be inflated but beyond
that it's belief it's belief that it
will continue to be valuable to people
in the future it's sort of a necessary
Fiction it's something that enables us
to communicate to have an economy to
make basic transactions history reminds
us that virtually anything can be used
as money as long as enough people
believe in its value
even in America what functions as money
has sometimes been quite fluid
in fact for nearly a century before the
wide adoption of the dollar people put
their faith in local currencies the
Constitution gave the federal government
the right to coin money to establish a
national mint in 1792 but it was silent
on what should happen with banknotes so
instead each of the states issued
Charters to Banks and private businesses
enabling them to design and print their
own money at whatever denomination and
quantity that they wanted and as a
result there were over 8 000 different
banks and private entities making their
own banknotes and you can imagine just
how Wild and diverse that was there's no
Central Bank or overarching entity
telling you you should put your faith in
this and you can trust it
crypto is only the latest new form of
money
and as most who've heard of Bitcoin know
it's digital
but since many of our daily transactions
are already electronic and don't involve
touching physical currency it's
reasonable to ask how is this different
we've been paying electronically for a
very long time you know you swipe a card
one account gets debited another account
gets credited we kind of don't really
think about what happens under the hood
but all of that is still doing
fundamentally the same thing it is
telling a third party someone who has
access to a ledger like your bank that
they would like to move the following
units on that ledger from your account
to somebody else's account today we have
come to depend on Banks and credit card
companies to keep track of where our
money is and manage the flow of digital
payments
cryptocurrencies may seem no different
but there is important distinction they
aim to do away with the middlemen like
Banks who may decide fairly or unfairly
who to loan money to and even
governments who control the money supply
what if we could remove all of those
intermediary players and I could
directly give you the amount that I owed
you how can we have a ledger system that
exists just between us that doesn't need
us to rely on an institution to keep
track of it for us if you can build a
system like this that actually works you
have built a functional replacement for
a lot of what a credit card company or a
bank does
foreign
it's not the kind of problem that would
keep the average person up at night
but for some computer scientists and
privacy Advocates building a new
Financial technology seemed of Paramount
importance
how often or in what system the thought
police plugged in on any individual wire
was guesswork
it was even conceivable that they
watched everybody all the time
you had to live did live
from habit that became instinct
in the assumption that every sound you
made was overheard and except in
darkness every movement scrutinized
Mark Miller was a computer science
student in the late 1970s
in the wake of Watergate and the Vietnam
War trust in the government was low
and Miller was one of many for whom
George Orwell's classic dystopian novel
seemed prophetic
we were very terrified of the
totalitarian future that 1984 had
painted
and we really took it on as our
responsibility to figure out how to
build a system that would be a tool of
Liberation not a tool of Oppression
universities were experimenting with the
first networked computers
what had originally been designed as a
cold war missile defense system was
laying the foundation for what would
become today's internet
though initially only a handful of
computers existed on this national
network
it was already clear these
interconnected machines were going to
radically change communication
at the same time networked computers
could give governments and others new
ways to monitor messages and spy on
citizens
some researchers were intent on
developing a new kind of cryptography
that would keep Communications secure
the history of cryptography for
thousands of years is defined by one
single problem no matter how you make
your code right the key that you use to
encrypt the message needs to be the same
key as the other person has to decrypt
it hear the important work of decoding
messages whose information must be
carefully guarded and transcribed with
perfect accuracy
now the problem with that is that if
anybody figured out the secret code well
then you were kind of out of luck they
could Now read all of the messages that
you were going to send back and forth
this is what happens when the Allies
famously cracked the code of the
German's Enigma machine in World War II
it helped turn the tide of the war
that was the fundamental limit to your
ability to create secret messages for
all of human history until the 1970s
when a group of computer scientists make
a series of extraordinary breakthroughs
the big breakthrough was figuring out
how to replace the vulnerable single key
system with a novel two-key approach
each side holds a pair of mathematically
linked Keys essentially a string of
characters one shared publicly the other
kept private the sender encrypts the
message using the recipient's public key
the message can only be unscrambled
using the recipient's private key
the sender can also use their private
key to encode a unique digital signature
into the message proving that they sent
it the thing that's really cool about
this is that I don't need to know your
secret key no one needs to know your
secret key it never leaves your device
or your piece of paper or your home it
stays completely secret the only thing
that leaves is a public key and I can't
figure out what your secret key is from
your public key
as long as everyone's private Keys stay
private secret messages are essentially
uncrackable
and signatures can't be forged
the trick lies in how the keys are
linked
through a type of math problem using
large prime numbers which is easy to
compute in One Direction but nearly
impossible to reverse engineer
it's very easy to take a set of factors
and see that they multiply to a number
it's very very hard to take a large
number and figure out what the factors
are that divide into it what if required
even someone with a super computer you
know hundreds or thousands of years to
try to break the cryptography and get
access to the information
that is a revolutionary change in the
world up to that point we were all kind
of helpless a against
efforts by those forces that would
Target us and now suddenly mathematics
had given us this amazing gift this this
tool that we could now use to
communicate secretly in a way that even
those large forces cannot corrupt
a column in Scientific American
described the Breakthrough
but the actual algorithms remained
unpublished in a paper at MIT
Miller feared the approach known as
public key encryption was so powerful
that the government might try to
classify it as a military Secret
I saw this as a hard fork in the road
that was bigger than me and I decided I
have to do what I can to make sure that
this idea is not suppressed
so I went to the MIT campus and I hung
around and talked to people until
finally I managed to get my hands on a
paper copy I went to a variety of coffee
shops never made too many copies in any
one place
and I mailed it from a variety of
mailboxes to home and hobbyist computer
magazines and clubs all across the
country and I also gave copies of the
paper to a few select friends of mine
telling them if I disappear make sure
this gets out
I have absolutely no idea and I will
never have any idea whether my actions
had any influence at all but the cat was
out of the bag
the paper was eventually published in
1978 and the ideas spread like wildfire
the Government tried to keep these
algorithms from the public but
determined to fight against centralized
control programmers put the codes on
everything from t-shirts to their own
bodies
cryptographers were in the unique
position especially once people started
getting tattoos of this string of
characters of being able to say like
characters and martial arts movies that
their bodies were classified as deadly
weapons
what you want a public key
some coders joined forces working in
loose groups to design Technologies
including new forms of money that could
free people from centralized control we
could call them Visionaries we could
call them radicals we could also call
them weirdos eccentric technologically
sophisticated very smart deeply strange
people who wanted to change the world
through transforming how money worked
[Music]
they anticipated that there was a coming
economy that was going to be built
around all of our data the surveillance
of our data set very soon we were all
going to be living more and more of Our
Lives communicating through digital
Technologies and a crucial piece of this
puzzle that hadn't really ever been
fully solved was figuring out how to do
money online where will you find a world
of ideas for your child
for the first time public key encryption
made it possible to securely use credit
cards and conduct other Private Business
online without it online Commerce might
never have become a reality but for
activist coding groups the fact that
Banks and credit card companies kept a
ledger of all transactions opened the
door for Big Brother
the most infamous of these groups was
known as The Cypher punks their culture
was hey we want to create privacy
because we can see where this is going
they had the foresight to see that any
big Enterprise there are going to be big
companies and and Regulators who will
try and control it The Cypher punks
mostly communicated through a mailing
list
the hardcore of the cipherpunks look to
digital money as a way to not just
guarantee privacy but as a way that they
could potentially destroy existing
governments and States completely
it was basically developers creating
tools for freedom and one of those tools
was digital cash not just digital
transactions like the banks were
providing but a new kind of money
altogether
across dozens of new forums there were a
number of attempts to design a system of
digital cash and then on Halloween 2008
a new name Satoshi Nakamoto appeared
enter Bitcoin called by its inventor a
peer-to-peer electronic cash system even
now no one knows who Satoshi Nakamoto
the inventor of Bitcoin is
but the paper was revolutionary
this is one of the most significant
Technologies in recent human history to
have been created by someone who is
still wholly anonymous who is Satoshi is
a question that may never be answered
but in actuality that sort of Mystique
is kind of what adds to the lore that
made Bitcoin really interesting to begin
with I think
whoever Satoshi is it's amazing that
they were able to fit all of what they
wanted Bitcoin to be in eight pages
satoshi's paper synthesized Decades of
work by hundreds of cryptographers and
computer scientists into an elegant
whole it showed how to create a digital
payment system
based on a new currency that eliminated
Banks
at the exact moment the 2008 financial
crisis shook the public trust that gave
them their power it was a manic Monday
in the financial markets
the Dow tumbled more than 500 people
were like if the world's Financial
economy is you know like taking a big
hit how do we make ourselves more
anti-fragile towards these things in the
future what Bitcoin proposed to do what
Satoshi proposed to do was produce a
kind of digital cash that didn't require
those intermediaries instead of
transactions going through a web of
connected computers owned by Banks and
other intermediaries it would go through
a web of connected computers owned by
the people conducting that transaction
[Music]
Bitcoins were simply Bits of computer
code in a digital Ledger
each person would hold their coins in an
anonymous digital wallet identified only
by its public key the holder of that
wallet could only spend those coins by
using their private key to sign the
transfer and authorize the transaction
but the real breakthrough was something
called the blockchain a technology that
ensured The Ledger hadn't been tampered
with and that people hadn't spent the
same coin more than once all without
needing a bank or other Central
authority to keep track
the payments would instead be conducted
through a decentralized infrastructure
of payments that would run on any number
of computers there's copies everywhere
and all the copies update as you make a
change as anyone adds something as
anyone does anything everyone's copy
updates which means that we all in a
sense together witness every single
thing that's taking place
the blockchain records the precise order
of transactions if someone tries to send
two people a coin when they only have
one one transaction is approved the
other denied well how do you trust
strangers on the internet that's a hard
problem and that's a lot of what
blockchains are designed to do is to be
able to say we're all collectively
anonymously asserting that this copy
this record of this sort of database of
information is the same and it's
accurate and hasn't been tampered with
[Music]
satoshi's blockchain proposed an
ingenious solution every 10 minutes or
so a record of every Bitcoin transaction
made anywhere in the world during that
period is assembled inside a digital
block
that block is then run through a
cryptographic algorithm called a hash
essentially a way of converting any
piece of information into a short unique
identifier like a label that describes
the contents of a box
but this is no ordinary label if anyone
changes the contents of the Box by even
the smallest amount then the next time
it's run through the hash function the
label changes completely making it clear
someone has tampered with what's inside
imagine a machine that you can put
information into let us say Moby Dick
all of Moby Dick the entire novel you
put it into the machine and it gives you
back a little code that code is the
summary the expression of all of the
data that makes up Moby Dick and now if
you put in Moby Dick but you have
changed one single word if you have
altered a space if you have removed a
period the code will be different you're
going to be able to tell that something
has changed with such a machine you
could then take say a transaction me
sending you ten dollars you can put it
into that machine you're going to get
back a little code that corresponds to
all of the data about that transaction
that code will not be the same if you
change anything about that transaction
data now you take that code and you add
that in to the record of the next
transaction linking them all into a
single continuous chain of verification
each block begins with the previous
Block's hash creating an ever-growing
chain of blocks the blockchain
users from across the network take turns
hashing blocks and adding them to the
chain
the other computers on the network
verify the block is hashed correctly and
update their copies effectively creating
a decentralized ledger that all users
agree on
thank you
that's good Vernon oh okay
[Music]
today people are using other
decentralized systems modeled on
satoshi's blockchain to try to move
money beyond the control of banks
governments and other traditional
Gatekeepers
okay if I was to give you a thousand
dollars what would happen with my
thousand dollars so if you put a
thousand dollars into let's say a
hundred thousand dollar property you
have one percent ownership in that asset
whatever the income is for that asset
you get one percent of that income
community property developer Vernon J
explains Equity coin to his Aunt Vivian
who has lived in East New York Brooklyn
for more than half a century we need a
light in the Vernon in this new money
business is going to be the light Let It
Be The Light Let It Be The Beacon that
we need to revitalize our community
all right all right how's everybody
doing tonight well thank you all right
Equity coin has attracted Interest
online but Vernon also makes his pitch
to The Community face to face
when we talk about cryptocurrency when
we talk about blockchain technology what
that does is it actually gives you a
chance to remove the intermediaries so
those banks that have been declining you
you know those organizations that say
actually no this is not going to work
you have the opportunity to to create
this system where people can invest with
you without the intermediary because
he's dealing with real world properties
and needs to hold a deed collect rent
and pay taxes the Securities and
Exchange Commission regulates Vernon's
coins like shares in a traditional
company
but he thinks crypto offers a more
direct connection with investors what I
wanted to do was mix in affordable
housing with blockchain technology and
create a system where we can actually
replace the bank with Community yes
thank you if Vernon attracts enough
interest he'll launch his coin joining
thousands of others in a volatile crypto
ecosystem where people can get rich or
lose everything so this is our time this
is our time but all of this raises the
question
if decentralized blockchains eliminate
the middlemen
who runs the network why do people even
participate in this network why do they
gather these transactions and add them
to the end of the blockchain and how do
we make sure that they're doing that in
a secure way
satoshi's answer came in the form of an
incentive system called mining that
rewarded users who added blocks to the
Chain by granting them newly minted
Bitcoins
these miners group transactions from
across the network into a block and run
it through a hash function like the
machine that created the label for Moby
Dick
in order for everyone's ledger to match
only one Miner at a time can add a block
to the chain so how does everyone agree
on which Miner gets to add the next
block satoshi's solution have miners
race to solve a cryptographic puzzle
a node that wants to add a block to the
end of the blockchain actually engages
in solving a computationally expensive
cryptographic puzzle and so the sole
purpose of this cryptographic puzzle is
just to show that I've spent a lot of
time and energy trying to solve the
puzzle that's it the idea is that it
needs to be expensive
by some resource to compute this puzzle
if it's very cheap or very easy or very
quick to compute the puzzle then it
won't do a good job of securing the
network and making sure there's only one
blockchain one version of History which
is very important
this puzzle called proof of work means
miners who spend resources in the form
of hardware and electricity get to add a
block of new transactions and earn
Bitcoin starter up Johnny
in the early days mining was a cottage
industry people built rigs at home
expanding the Network and Sharing their
setups on social media well it's a
little overview of what we got four
machines I should clear right at 2 800 a
month
mining is also how new coins are
introduced into the system instead of
Banks and governments controlling the
money supply it's automatically
regulated by the software
as more coins are mined the reward
decreases and the proof of work puzzle
gets harder to solve and requires more
energy
giant mining Farms exist all over the
world using as much power as some
countries about 30 percent of the mining
done in the world is in America and most
of that mining is starting to be done in
Texas because they have a lot of energy
also a lot of the mining is done where
it is cheaper places like Iceland
Kazakhstan China was huge in mining for
a while and then they banned it with
about one percent of the world's
electricity going to crypto mining some
are pushing to find alternative sources
of power what's becoming huge now is
hydroelectric energy using water as a
way to mine Bitcoin and also we're
starting to see more of the solar panels
wind energy ironically Bitcoin actually
provides a way to think about a standing
up different kinds of renewable
architecture around energy that wouldn't
otherwise necessarily have capacity or
the ability to be stood up but others
don't buy it particularly when
considering the entirety of the Bitcoin
mining Enterprise spread around the
world there is a tendency to point to in
some cases valid but mostly not
Renewables as part of the energy
consumption of Bitcoin there are people
that sort of wave away
the seriousness the gravity of that
damage that harm that they're causing
and I find it immoral we see the
construction of a vast machine that
might be one of the most purely wasteful
machines ever built a system that that
burns processor power and coal and
generates nothing but Heat and the
solutions to deliberately meaningless
problems but early on things were very
different mining was easy in Bitcoin
essentially worthless in the early days
there were websites that had Bitcoin
faucets which were basically just a site
you would go to click on it you know
create a wallet and it would enable you
to just get free Bitcoins
[Music]
Satoshi didn't seem interested in making
money
and in 2011 sent a final email before
disappearing for good other early
adopters saw the promise of the
technology and tried to generate belief
in its value once Bitcoin was developed
enough to be a kind of largely
functioning piece of software it had to
actually be used in order to become
money so one person on the Bitcoin
Message Board said I will pay someone
with Bitcoin to order me two pizzas with
lots of toppings
and someone else on the other side of
the country ordered that pizza sent it
to him and got paid in Bitcoin he
essentially paid about 40 bucks for two
pizzas and those 10 000 Bitcoin are well
over I believe 200 million now
but that transaction had to happen in
order to show that hey people do want to
pay with this Bitcoin is now up to a
hundred and eleven dollars but as more
users join the network and the price
increased something changed the hottest
investment on or off Wall Street are
these cryptocurrencies they are soaring
they began to see it less as money that
is a transactional tool that you would
actually use they started to see it
instead as a kind of asset despite wild
fluctuations bitcoin's value increased
over time
and other coins emerged on their own
blockchains
While most chased profits one early
Bitcoin user saw a different kind of
potential and helped invent what would
become one of krypto's most famous uses
I'm an artist and I've been an artist
for a long long time but I wasn't always
I studied philosophy and literature and
that was my main kind of Interest
in the early 2000s Kevin and Jennifer
McCoy were successful digital artists
their Works shown by prestigious
galleries
but unauthorized copies were appearing
all over the internet
they realized there was no such thing as
a digital original that they could
actually own and control
in a digital environment of course it's
always a copy and it proliferates uh you
know everywhere and you know and so
there is no original but Bitcoin gave
Kevin an idea
and that System created for the first
time an idea of digital scarcity all of
a sudden the everyday Norm that you had
about digital technology that it's
infinitely reproducible that it's
everything is just copy and paste that
didn't apply in this case if I send you
my Bitcoins I don't have them anymore
and you have them that's scarcity it's
not everywhere it's only somewhere and
so I had this realization that if it was
possible via Bitcoin to create uh
uniqueness around currency then there
had to be a way that you could create
uniqueness around a digital artwork but
I didn't know how I'm really excited
about this last pairing Kevin attended a
conference where each artist was paired
with a tech partner and given 24 hours
to develop a new idea they'd present to
an audience
what we wanted to talk to you about
today is this idea we have monetized
graphics
and how we can put digital artworks in
Chains so almost immediately after I was
paired up with Kevin McCoy he and I sat
down and started sketching out ideas for
how could you make an assertion on a
blockchain to say that a certain digital
work was an original unique item
after an all-night coding session a Neil
Dash and Kevin announced that they had
registered a video on a blockchain
it was a segment of a video work that
Kevin and Jennifer McCoy had created
together and I actually found it
mesmerizing and this was our onstage
example of taking this file and creating
a blockchain based record of that we've
created a system that will establish
verification and provenance over digital
files digital artworks that provenance
is a chain of ownership and Neil and
Kevin created a record of ownership that
would live on the blockchain
whoever held the key to access it owned
the digital original we did pull
together in a couple hours so given that
it was something we sort of did over the
course of an evening and into a late
night uh it was a pretty good first
version do you got 20 bucks and we sort
of said we'd negotiate a price for it
you can pay you in U.S dollars sure all
right that's cool with me
I have four dollars
really it was the first transaction of
something that would eventually come to
be called a non-fungible token or nft
today nfts can act as a digital proof of
ownership for things Far Beyond art
from tickets to a concert to membership
in a club operating like keys that
unlock benefits to the owner
you can imagine rolling it out into a
more platform-oriented thing but back
then Kevin's notion that it was possible
to own a digital original didn't
immediately catch on
you know that it's new you know that
it's a novel thing you know that it can
feel that it's important and nobody
cared
[Music]
Kevin's idea may not have taken off but
he wasn't the only one hoping
blockchains could go beyond Bitcoin
in 2015 a 21 year old coder named
vitalik buterin launched ethereum a new
blockchain designed to decentralize much
more than just money ethereum Community
is I think a unique in the crypto space
for its diversity like it's not just one
Community it's you know there's
a lot of different sub communities
there's something in it for everyone
today ethereum is the largest blockchain
in the world running 10 times more
transactions than Bitcoin like Bitcoin
the blockchain incentivizes users by
rewarding miners with the currency in
this case ether
but the range of what ethereum can do
goes beyond a simple monetary
transaction we want to have a quick
interview with
a person who needs no introduction so
without further Ado let's welcome
vitalik buterin
[Applause]
ethereum lets users create their own
programmable tokens using smart
contracts
instructions in the form of computer
code that execute rules on the
blockchain instead of just adding or
subtracting money from a ledger these
smart contracts make it possible for
anyone to Mint a token and embed it with
nearly any functionality from tracking
music royalties
to encoding money with last will and
testament directives doing for the
blockchain with the iPhone's App Store
did for the cell phone
today
conferences like this one in Amsterdam
attract thousands of coders and
entrepreneurs
so the young people are excited now
about blockchain and all the
possibilities that blockchain can give
and I haven't seen this kind of
excitement since the time of internet
was born
because anyone on the internet can see
and inspect The Ledger proponents claim
blockchains like ethereum can make
transactions more transparent and
because they eliminate the middlemen
more efficient
there's an idealistic quality to many of
the hopes surrounding the technology
everything which we wanted to preserve
for eternity can and should be on the
blockchain whether it's a movie or it's
our housing contracts or the way we
interact with the let's say Uber or rent
rent a car so right now we have a paper
will it could be a lot of drama a lot of
debates between family members when you
pass away well at least if you actually
do that on chain on the blockchain
actually you can actually get a say and
you know that it's going to be
guaranteed to go to those people when
you pass we are enabling individuals and
organizations to access a market for
climate action in an efficient low-cost
Manner and by bringing these existing uh
certificates onto a blockchain
um we unlock uh much greater efficiency
lower transaction fees and much faster
settlement times
most projects like these are still in
their early stages and not yet viable
but one of ethereum's most popular uses
helped Kevin's original idea for putting
artwork on the blockchain takeoffs
now to the latest Trend that's sweeping
the internet the skyrocketing prices for
Digital Arts sold as nfts nft sales now
topping a half a trillion dollars today
mfts or non-fungible tokens seem to be
everywhere Nyan Cat is of course a meme
of a cat with a Pop-Tart body prancing
through space with rainbows flying out
of the butt
most of them are registered on ethereum
where they exist as smart contract
tokens on the blockchain it's been
surreal to go from this personal
collaboration with somebody and a
transaction that was about collecting
their art to the last few years as it
became this big hype cycle the art world
has been turned upside down again nfts
for nearly anything imaginable sell
through online marketplaces but even
traditional auction houses have gotten
in the game
some of the most coveted and expensive
are essentially digital brands that
people desire part of what's so
compelling to a lot of people that
collect nfts especially when they're
part of a large edition of them is that
each individual work is digitally
identified as being unique and you know
that has meaning to people to the fans
and enthusiasts they kind of feel like
they're collecting baseball cards the
big one is called board Apes which can
kind of become almost a cultural brand
on its own
[Music]
it's really cool
it's like I want something that like
kind of reminds me of me it would be
really strange to see a celebrity like
Paris Hilton go on a late night talk
show and talk about a penny stock that
they're investing in and recommending
that others do the same but nfts have
become a um acceptable topic for late
night conversation
the frenzy around new blockchain
applications doesn't end with nfts
blockchains are even being used to
create new platforms for cooperation
called decentralized autonomous
organizations or Dows for short
one was even involved in an attempt to
buy an original copy of the U.S
Constitution at an auction in New York
City and the idea here was that good
people came together and they decided
they wanted to pull some funds and
purchase a copy of the Constitution a
digital Collective formed on a chat
group and created a token on the
ethereum blockchain that allowed members
to contribute money to the project and
have a vote on how it was run
it started about a week ago it's got
some friends in a group chat texting one
another they found out the Constitution
of the United States is going up on
auction and you said you need to raise a
lot of money and can we do it as soon as
the monies are piling in we just got
shocked that people actually like have
their reads in us and we're like okay
now we have to deliver it over the
course of seven days nearly 20 000
members joined the Dow raising more than
40 million dollars well beyond the
document's pre-auction estimate
and now let's begin the auction lot 1787
the Constitution of the United States of
America well starts being here at 10
million dollars at 10 million 11 million
12 million at 13 million now 14 million
Ironically in the end the group's
transparency was a liability at 41
million dollars
sold 41 million dollars cattle 4-1-1
it was outbid by a hedge fund CEO who
could see how much money they had raised
but I think what's fascinating about
Dao's is they really are providing these
micro experiments in how do we organize
and govern ourselves and our activities
what we just accomplished
no one has done in history before and
now we get to plot our next move what do
you want the future to look like what do
we want to build next what do we want to
do
as thousands of experiments like
Constitution Dao take place blockchain
use is skyrocketing as are the
environmental costs
so ethereum Engineers have been working
to implement a replacement for satoshi's
energy intensive proof-of-work mechanism
it's called proof of stake when we move
from proof of work to proof of mistake
the energy consumption of the ethereum
platform will be reduced by
99.95 percent and not to grow again
instead of spending costly energy to
solve a computational problem and earn
the right to add a block to the chain in
proof of stake the system randomly
assigns the right to add a block to
those who already own coins the more
coins a user owns the more likely they
are to be chosen in this way proof of
stake makes it possible to secure the
blockchain without burning huge amounts
of energy
[Music]
other blockchains already use proof of
stake but it's never been tried at the
scale of ethereum's network
and what amounts to a giant software
update could put the system at risk the
classic metaphor we use in Tech is it's
like trying to change the engines in a
plane while it's in Flight the reason
it's hard is because millions of people
and way more millions of lines of code
are relying on the system as it
functions today all right we're one
minute out guys still in bring 2022
a test suggests the upgrade might soon
be ready
[Applause]
questions remain about the transition
and whether it will end up trading one
problem for another
it's more environmentally responsible
but perhaps less Fair
since the wealthiest users will be able
to stake more coins add more blocks and
earn even more coins
but in the meantime as crypto technology
continues to evolve the question no one
can answer yet is will it be able to
live up to its decentralized promise
ideally these blockchain platforms can
help disintermediate the power that
exists locked up in a handful of
Corporations and kind of put that back
into communities back into individual
users and and maybe shift the trajectory
from here to maybe over here
back in Brooklyn that's the hope of
Vernon and his programmer Akil who are
finally ready to launch Equity coin on
the ethereum blockchain
we're going to allow for the sale of 10
700 tokens at 100 per token so it's 1.07
million dollars that we're going to be
raising
Vernon believes that trust will grow as
people see how their interests are coded
right into the tokens contract
smart contracts take the rules and
regulations of a normal contract and
embed them into an automated system so
that both parties can adhere to those
rules and regulations without trusting
each other it's a trustless way of doing
business Vernon hopes for a
decentralized future where crypto
removes The Gatekeepers and levels the
playing field JP Morgan rolling out the
first cryptocurrency backed by a U.S
Bank but the original promise of crypto
may be in doubt fortune favors the brave
as big business increasingly gets in on
the action get started with crypto on
venmo
today nearly all crypto Financial
transactions go through centralized
exchanges that enable users to buy and
sell Finance exchange the world
they can decide which users can hold
accounts and can freeze funds at the
touch of a button
this has drawn the interest of financial
regulators
a battle is brewing in Washington over
how to regulate the cryptocurrency
industry we have tremendous amounts of
financial regulation and some of it is
there for a very good reason it's to
protect consumers but preserving the
ability for competition and for people
to innovate is also very important
making sure that we don't
unintentionally regulate into a world of
a few very large powerful intermediaries
I think that's very important as well
the
struggle to decentralize I think is
never ultimately one every time you win
it at one level you create a system in
which you can lose it at the next level
up there's the real concern that the
future of crypto will look a lot like
the present of the internet just a kind
of re-entrangement of the same old forms
of exploitation just on new terms one
way or the other
many believe blockchain is here to stay
you don't unring that Bell it's not
going to vanish what it's used for is
something that we have has yet to be
fully determined
earn great Rising Don what's going on
brother at last Vernon gathers his team
to launch Equity coin and start raising
money from the public let's do it
[Music]
I look at cryptocurrencies as being the
very very early days of a better
technology I think in the language of
tech we are using the alpha rollout the
earliest jankiest least figured out
version of Something T minus three two
and one boom just launched our
investment packages everybody
foreign
[Music]
foreign
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[Music]
thank you
[Music]
[Applause]
foreign
[Music]