Video - Inside Bitcoins Las Vegas 2013 - Moving Bitcoin Forward

Even as bitcoin continues to play a larger role in mainstream culture, plenty of skepticism remains. Going forward, what are the challenges facing the bitcoin community as it attempts to bring trust, transparency and legitimacy to the burgeoning bitcoin market? This panel will discuss the challenges of bitcoin adoption.

TRANSCRIPT

Stewart: Okay, here comes our final panel. I don't know if anybody has been over to the social gaming submit which was taking place over on the side, but Ardon Lukasiewicz who is the founder of the Bitmarkers has done a couple of presentations over there. He did Bitcoin one-on-one session actually earlier for the gamers. So, we got him back now. He is on stage. He has also does financial analysis for Aria Casino. So, he has got a lot of experience. He is going to corral our panelists, choreograph this panel and take it home for us because this is the last one, right? Let's make it good guys. Let's give him a big round of applause.

Ardon: Thanks. I think I’d like to start off with just a round of applause for Stewart and everything he’s done here with Inside Bitcoin. It’s been a lot of fun and I know we’ve all sort of grown our professional network just being around other people as crazy as we all are about Bitcoin. At least, makes me believe that this is going somewhere and I’m not just a crazy and alone. Thank you for that. I’d like to introduce our great panelists. We were speaking over lunch and kind of going back and forth already with our point of views. It should definitely be very interesting. We have Andreas with Route 11; we have Adam, who’s a partner at Strategic Counsel Corp; Eric with ZipZap; Izzy with Podesta Group and Robert Cho with SecondMarket. We kind of have everyone, lobbyist groups, legal and I’ll let you guys go ahead and make short introductions of yourselves. Let’s start on this end.

Izzy: Very briefly, I’m a principal at the Podesta Group. My name is Izzy Klein. I’ve been paying attention to the virtual currency space for quite a while. I have a few former clients, including Robert at Second Market and a few other folks in this space and look forward to hearing what the rest of my co-panellists have to say. I’ve really enjoyed the conference thus far. Thanks Stewart.

Robert: Hi, I’m Bobby Cho. I’m the Vice President at Second Market, which is a broker dealer registered in New York and I’m also the head, spearhead of Bitcoin trading at SecondMarket, along with my group also is authorized participant to the Bitcoin Investment Trust, or the BIT, as we like to call it. I’m really excited to be here.

Adam: My name is Adam Ettinger and I’m an attorney. I counsel technology companies, especially in the start-up phase, pre-public and more and more since the middle of last year, Bitcoin companies in different sectors, whether it’s mining or payments. I’m happy to see a lot of my clients were here this year and going farther. It’s just been a lot of fun. I also represent a number of investors that have become very active this year in the Bitcoin space. Most of my work is in the Silicon Valley and some in Los Angeles.

Eric: My name is Eric for VP Bus. Dev. for ZipZap. I’m currently focusing on Europe, Middle East, Africa and Asia markets; more for the developing areas. What we’re doing with ZipZap is we’re growing our global cash payment network. You guys probably remember us when we were operating in the States with BitInstant. We’re growing our model into different markets right now. I’ve been really travelling a lot – Baltics, Europe, Africa as well, so a lot coming from us starting from January, so really excited about it.

Andreas: Hi, I’m Andreas Antonopoulos. I’m a co-host on Let’s Talk Bitcoin and I’m writing the O’Reilly book for Bitcoin. I’m very interested in Bitcoin in the developing world and the “other six billion.”

Ardon: Since you last spoke, and you’re with the developers’ world, how has Bitcoin’s origin from cryptography groups shaped and impacted the trust relationships currently inside of the community? How would you say?

Andreas: I think Bitcoin really revolutionizes trust by changing trust from a model where trust is achieved through exclusion of access, which is the traditional financial model to one where trust is enabled through computation. What that means is you can create an open access network where anyone can connect, innovate at the edges and have immediate access to a world economic network with full trust in the system. Trust is decentralized, it’s peer-to-peer and it’s given directly to empower the individual. That model is radical, it’s revolutionary and it’s going to change the world.

Ardon: Just curious – who here obviously there is financial reasons, too but who here...is trust the most important reason that you are following Bitcoin... with openness? It’s very interesting. Any other? I’d say the next topic would be legitimacy and where the current state of that would be and I’ll pass it over to Robert.?

Robert: I think we’re in a really interesting phase right now. Regulation in the US is really yet to be seen which I think will happen in Q1 of next year, Q2 as regulators wrap their heads around it. Regarding legitimacy, I think that what we’re seeing is a weeding out of the illegitimate players from maybe a year or two ago, to more the legitimate players. I think it’s just a natural progression of the market along with the players involved. I think that we need that to occur for real venture institutional money, the institutional guys to really get involved to bridge that gap.

Ardon: Any other comments?

Adam: I was thinking about it more today that I remember in 1994-1995 as the Internet began to commercialize, it went through very much the same sort of cycle into legitimacy as it went into the mind space. The number one ISP in the country, at the time, it was when one of my first clients was NetCom which I think, had 100,000 or even less than that, as the Internet started to open up and was still the number one ISP in 1996 with a half-million accounts. What was happening was so many of the people that saw the vision for the Internet, the openness, the capability of what this platform would do and what it could enable, started to meet more with venture money, started to meet more with a different professional entrepreneurship. Some of it merged, some people got rolled over but as people became more aware, all the other processes actually got to get involved, such as regulatory controls and us trying to figure out and figuring out how it’s all going to work at the end of the day. People became more accustomed to it. It’s not so much the legitimacy of the platform, whether it’s the Internet platform, TCP/IP or Bitcoin protocols and everything that goes with it, but the entire ecosystem of users, of companies that are moving it forward and the investors that help them. In the last month, we’re seeing that really... and this does remind me of sort of 1995 when Kleiner Perkins financed Netscape. It wasn’t the first mosaic browser, unfortunately. Some of the first innovators weren’t there soon afterwards. We’re seeing this again with Andreessen Horowitz which is really a thought leader and a lead investor in the Silicon Valley. It’s one of the firms that other firms watch; being interested in this; adding partners to move towards it which was... they added one new partner just on 9th. Excel Partners coming in to the circle. It raises the bar in many ways but it also is going to give confidence to the entire network. It is something like that that may help to fix the number one complaint I’ve heard here which is – Hey, our companies don’t have access to banks.

Ardon: Yeah, and legitimacy definitely goes hand in hand. Even the largest companies in Bitcoin, we’ve seen nearly a 180° flip of how they were probably a year ago and how now. One thing that’s always been important with Bitcoin, as well, has been the transparency of the network. One of the hottest topics of recent has been Bitcoin address blacklisting, KYC and AML compliance hurdles and most specifically, companies such as Coinvalidation. Is there anyone who this directly affects? I guess ZipZap, or Andreas?

Andreas: Sure. First of all, slightly on the previous topic, I reject the very concept of legitimacy as something that we should seek, need or require in Bitcoin. Legitimacy is a word bandied around by the most corrupt, morally bankrupt forces on this planet to try to smear Bitcoin. We don’t need legitimacy, we didn’t ask for permission and we don’t require the approval of anyone. Bitcoin is here, it works and the forces that ask us or try to give us legitimacy are themselves morally bankrupt so why should we care, first. Secondly, on the issue of Coinvalidation; these attempts to somehow fix the Bitcoin protocol to prevent theft, will not only fail but will reintroduce at the core of the protocol the types of controls and levers of power that have traditionally used to corrupt and influence the currency. Those are exactly the forces we pushed out of the core of Bitcoin and we don’t need them. In fact, they would have a corrosive influence from the very beginning and they would spell the doom of Bitcoin, the currency. They won’t work and I’ll tell you why they won’t work. When HSBC launders money through Bitcoin, FairCoins won’t get blacklisted, WikileaksCoins will, GreenpeaceCoins will. The forces of descent with an oppressive government will have their coins blacklisted but guess what, HSBC could sue whoever creates that blacklist and terminate their operation. If we have blacklists within Bitcoin, we are introducing a counter-party risk that introduces the entire legal system back into a system that’s based on trust between two parties – only two parties. The only requirement to redeem a transaction on Bitcoin, is that you have the necessary code to solve the equation. That’s it. That’s where Bitcoin gets its legitimacy from.

Ardon: That’s definitely where the community’s thoughts have been from the start but especially with companies like Second Market, there does have to be the proper interaction between the two financial worlds. You’re in the middle of that too. What’s your thoughts, especially with BitInstant? You guys have been there.

Eric: Yeah. We’ve gone through some of the hurdles and everything else with compliance and regulation. The approach that we’re taking is obviously, every customer that comes through us and using cash to get Bitcoin, we do the KYC process and the onloading with the exchanges. We don’t hold any funds. We’re not an exchange ourselves but we are enabling an easier, quicker way in which cash can get into exchanges from consumers. The everyday consumer, the shop keeper in Africa needing to get Bitcoin, or emerging markets that need that quick access for €100, or €50, or €10. We’re really targeting that mainstream consumer adoption really. We can talk about financial instruments, and derivatives, and Forex and all that stuff which is great but we really need to look at what Bitcoin can do for emerging markets. We really need to focus on how we can improve the economies in Africa and Asia and all over the world really. Again, we’re taking a stance on remittance ourselves so, here we are as a nation of giving these developing nations billions and billions and billions of dollars of aid every single year, yet we charge them billions and billions of dollars of remittance fees. In this equation, something doesn’t make sense and that needs to stop right now. Period. When you send money – say you send $100 to Kenya right now, that $100, you’re going to have to spend $40 to send it. This person receiving the money in Kenya – imagine if they were receiving $40 more every time you sent $100. This is the market that needs to be flipped upside down on its head, big time. Seriously. Seriously. If there was one area of Bitcoin that we could target right now, and it’ll make a massive change globally, it’s in the remittance market everywhere.

Andreas: Yeah. You think the other six billion who are dealing with that kind of stuff care about legitimacy? Yeah, exactly. They care about the fact that they are getting ripped off by international corporations that are sucking money out of the system from the poorest people in the world.

Adam: Isn’t that legitimacy? In other words, knowing that I’m going to get what somebody sends me and I’m going to get the whole amount, to me, that’s a legitimate transaction. I mean, maybe it’s a semantic issue. I don’t think that any industry should own the word and I think that, if anything, because legitimacy or trust can get coded into Bitcoin, can get coded into that – I mean, that’s the real beauty I think of it. Also, the opportunity to give people the amount that they want. In other words, there are a number of people this week that are showing off third party signatures for escrow. Ultimately, it’s a trust mechanism, in a way.

Andreas: Algorithmic trust.

Adam: Right.

Andreas: That’s not how the word is used most of the time when we’re hearing these discussions. It’s used in reference to control over the destination of your money. It’s used in reference to political control over the recipient and that’s a whole different ballgame. I totally agree with you. If we’re talking about transactional legitimacy, that’s a matter of simply verifying the execution of the output. That is legitimacy in the algorithm – that is trust, right in the algorithm and it doesn’t involve any counter parties. That’s the magic of Bitcoin. That’s not how the word is used most of the time in these discussions.

Ardon: Especially when you try and apply to Bitcoin now to real world uses, there does have to usually be some sort of center of trust, since the community is coming around to purchase goods and products from each other. Specifically, the closure of Silk Road has increased Bitcoin legitimacy directly after, and we saw that with the price and with mainstream media but the underlying frame trust work especially with that community was damaged. I still feel, from what I see, it still is damaged and also Bitcoin is known for complex scam tactics. How do these two groups mix? Izzy, let’s start with you.

Izzy: I understand Andreas’ point earlier but I will say that there are legitimate fraud and other issues that will keep policy makers, regulators, etc up at night – and law enforcement. Those are issues that are going to have to be tackled by the community at large. They’re going to have to be tackled not by displaying the kind of trust that entrenched power needs to see, but by telling a narrative. I remember a speaker on one of the previous panels talking about – we’re looking forward to the day when the invention of Bitcoin by a software developer 10 years ago, won’t be the first thing that’s mentioned in every story. I agree with that. I think that there is a whole world of, not just Bitcoin itself, but other virtual currencies and alternate payment rails that are being developed across the globe that is an amazing alternative to the existing payment rails and a lower-cost alternative. That’s democratizing. That’s good for people in the third world. That’s good for everybody. That narrative is not necessarily being told in Washington. There were a couple of hearings that you all, I’m sure, watched. Many of you probably watched. That’s only the beginning. There will be more hearings. There will be policy written, either by the regulators or by the legislators that will affect this industry and this community. Getting out in front of it, explaining how this all works to people is important. Most people don’t understand what a Bitcoin is. Most people don’t understand how our existing payment systems work. Visa or MasterCard – they don’t understand it. It’s complicated.

Ardon: You brought up an interesting point and I feel a lot of people especially with prominent people as yourself, we always want your opinion on how did the Senate hearings go? Where do you see that direction? What’s 2014 looking like from that angle? Let’s take Adam. Maybe a little further into that.

Izzy: I don’t want to filibuster but I will say, just very briefly, and then I’ll pass it onto Robert, that I think that there will be more hearings. I think that the hearings that were held this past month were actually very positive. I couldn’t imagine them having gone better but one of the hearings had one Senator sitting there the whole time and the other had four or five. The level of participation is not particularly high right now but it will be. I think that that’s something that you need to keep in mind. I mean, things don’t just magically happen in Washington. Congress is a stimulus/response organization. Something happens like Silk Road so hearings are held. Silk Road is busted by law enforcement so hearings are held.

Ardon: How do you think the Chinese news is now? How will that affect it?

Izzy: I’m going to stop talking. I’m going to pass it on over here.

Robert: Yeah. I’ll touch on the Senate hearings. Us, at Second Market - we feel like we’re pretty in tune with what’s going on down in DC. The tone from the beginning of the year to the end of the year has shifted, I think, and I think we all agree that’s it’s gone from kind of a negative tone to more of a maybe not so positive, but maybe more – OK, let’s learn how this can help us. I think that’s the way that it’s going and I think that’s the way that it will continue to go. To kind of touch on – I think it was FinCEN, the woman at FinCEN, I can’t remember her name – but she had mentioned that still the US dollar is still the best way to money launder. It’s still the best way to operate in the black market, or whatever you want to call it. Bitcoin – it’s pseudo-anonymous. I think that we can all agree that there comes a point where it is going to exist, to touch on Silk Road, something like that will exist in every currency, every denomination. It’s unavoidable but it’s what can we do to get past that and to bring it to kind of more of a legitimate light.

Ardon: Very interesting.

Eric: Just to add to that. The problem here is the financial services are completely broken. I mean, we know that; we’ve labelled that; this is why we’re here; this is why we’re speaking. I just have a couple of notes here like – regulation is a necessary friction. Obviously, we’re talking about that and we need smart regulation that doesn’t stifle innovation. We need to really make sure that we maintain innovation without stifling it and then moving it into other markets which is exactly what you guys are doing here. Again, there is no such thing as 100% anonymity with Bitcoin. We believe in privacy not anonymity. That’s just kind of where we’re heading with that and again, compliance is also a competitive advantage, and staying out of jail is also a competitive advantage, right? If you do the compliance right, you’ll reduce fraud – yada, yada. It’s a real... I mean, it doesn’t need to be complicated. We’re not reinventing the wheel. We just need to kind of make sure that we’re staying within that regulatory framework.

Adam: If I can follow up on that. One thing I’ve always had to deal with in my practice is new technologies run into old laws and there are the entrepreneurs that will ignore it and run past, or the entrepreneurs that have to run head on, and then there’s this unanticipated hit. It went from trying to get... I was representing what was the number one firewall company in the United States in 19..God, I’m starting to sound old... 1997, and we couldn’t get the products out. The Department of State is the one and you have to go through this rigmarole back then and basically, it was on the same technology list as nuclear equipment. To try and explain that – it’s a firewall. It was a terribly complex thing to do and the bureaucracy that was there was not... didn’t have the facility to be able to keep up in real time, or even respond to it in any kind of measurable way and we would have lost the lead. As individual entrepreneurs, as people trying to secure the Internet, as people trying to make businesses and individuals safer which is not government’s objective. At the time, I actually came up with the crazy idea – wait a second, maybe I can just call somebody who is in the State Department and I ended up calling the two Senators from California. One of them later wrote me he was too busy impeaching the President at the time, as I recall. I’m sorry, Congress woman. Two Congress people in the right jurisdictions, but the Congress woman from Palo Alto ended up helping to explain and we were able to move things forward and ultimately, the law changed. There was another time when the Church of Scientology sort of proved by its litigation that State law could cause the ISPs and other Internet providers to be liable under State law. That would have shut down most of, what we know of, as the Internet.

Andreas: It wouldn’t shut it down, it would just move it abroad and that’s the real issue we should be talking about here. The Senate hearings were successful because they backed off for a tiny bit and I’m so glad Tony Gallippi was there to do a spectacular job in talking about jobs, and votes, and growth opportunities. The truth is that if the US cracks down and regulates Bitcoin, Bitcoin doesn’t lose. The US loses because all of the innovation and all of the jobs are going to go elsewhere. This is a new world we’re living and you can scream at the meteor and its trails but if you’re a dinosaur, you’re going to get it.

Adam: I’m very much in support of that but one thing that I heard during the Senate hearings which I was not expecting to hear is again and again, people testifying saying that they recognized that they didn’t want to ... how much veracity in their statements, we’ll find out...but that they didn’t want to stifle it, that they didn’t want to see it go (inaudible).

Andreas: This is really an issue about jobs and innovation. The thing is: Bitcoin enables innovation at the edges without permission. If the innovation can’t happen here, it’s going to move abroad. To the point of whether you need to stay out of jail, or deal with regulators, or the Silk Road issue – listen, the greatest heist in the history of humanity happened in 2008 and no one went to jail. Right now, we’re dealing with regulators who are chasing around Silk Road which is like a gnat, while they could take the bus 40 blocks south and go to the corner of Water and Wall Street and find the real crooks who have complete immunity because they own the banks. I’m not interested in discussing regulation from the perspective of people who are absolutely corrupt, completely bought off and are operating in a system that’s raped from top to bottom. The whole point of Bitcoin is to be able to move outside of that system. Here it is difficult to have that discussion, but trust me, the other six billion know exactly what we’re talking about because for them, this is a matter of life and death. It’s not about regulation, it’s about corrupt and oppressive governments. We’re having this little side discussion in the US about whether we should apply strange antiquated laws. Guess what? Those laws are there to protect incumbents from competition. When was the last time one of these regulators protected consumers? I don’t think that’s a legitimate conversation. I don’t think that’s the way we should be looking at this.

Ardon: Since we’ve kind of touched on the now, and sort of the past, I think rolling out of that, let’s start with Andreas again - is where do you see the future of these trust relationships, especially if the community did stay at its core values even more than it predictably looks like it will. Where do you see the next five years, ten years? What’s the end goal?

Andreas: I think we’ve reached a point where Bitcoin is now global. It’s got the attention of the world and it’s, at least from external forces, pretty much unstoppable. The only question is if we’re going to fail from some kind of internal bug that disrupts Bitcoin. Guess what? They are going to be really surprised the next morning when we bootstrap another currency on the same platform because Bitcoin isn’t a currency. Bitcoin is a technology platform that allows a distributed asset ledger. It’s one of the most astonishing inventions of the century and it cannot be un-invented. If they spoil this currency, we’ll boot another one and another one after that. I would suggest the next one we put in strong anonymity and CoinJoin in every transaction and every wallet, by default, always on – can’t turn it off because that’s the kind of battle we’re in right now. We made the mistake on the Internet of not applying Tor from the very beginning and now we’ve got the NSA, like a parasite on the global brain, sucking all the information up. We need to learn from that mistake and we need to not repeat it. This is not just an issue for us because at the same time that the NSA is studying the blockchain (and trust me, they are), we’re going to have every oppressive government in the world tracking every dissident down, dragging them out of their houses, torturing and killing them because they made a transaction on the Bitcoin network. And for those people, this stuff is really damn important. So, I’m interested in looking at how we can strengthen the core infrastructure of Bitcoin, enable strong anonymity and then let the protocol alone and do all of the innovation in the layers above. We’ve already got a winning solution. It’s worked perfectly fine and I want to see as little done to it as possible, from now on.

Ardon: To stay on the future - to legitimize Bitcoin, I know a lot of us are starting Bitcoin businesses and you guys obviously have, what legitimizing events do you feel needs to take place, or do you foresee? Let’s even say for something such as SecondMarket because you guys are…

BC: For the future looking forward, basically, I think that for me and I think for SecondMarket, basically, my background is fixed income. I’m a fixed income trader and I got into Bitcoin in January of this year. Basically, from my perspective, I think it’s basically bridging the gap between traditional investors and kind of the new technology that we see as Bitcoin, or the innovation. We’ve done that through the Bitcoin Investment Trust, the private fund that we have launched in September. I think that a gentleman had mentioned something about Fidelity, and Fidelity allowing people to basically allow their clients to invest in Bitcoin but that’s not exactly correct. Basically, you have to be an accredited investor, accredited individual and you can invest through your self-directed IRA through Fidelity, as we partnered with them, to invest in the fund. In my perspective, I think the future is to continue to bridge the gap between the institutional folks and the technology folks and just kind of help them manage that process.

Adam: I think it’s going to be innovation and permeation and variation. The applications of Bitcoin are a lot like a genetic algorithm and right now, what we’re seeing is so many different people taking it and figuring out for themselves how to use it – not just how to create a new business around it but how to use it. I remember one of the better stories I read was a PBS story about a farmer who found... and there is no reason this man should have stumbled upon Bitcoin but it ended up solving an American farmer, many of his issues with how he has to run his business. As more and more people get involved in it, more and more countries, more and more creations... more and more innovation happens in different directions, it permeates. We begin to find the story about how it changes things for the better, this is very true of the Internet too begins to far outweigh the stories of – Oh, you could lose your this, or somebody could be doing that, or this Ponzi over there and people begin to see it for themselves, ultimately.

Ardon: Do you feel that the current cycle of media is more legitimizing? Obviously, a lot of people feel any press is good press but typically the technology is not reported on, the benefits aren’t necessarily reported on. It’s always price; this guy's now a millionaire and huge busts, black markets. How do you guys feel the media has played a role?

Robert: We all know that the media has to sell papers and they have to get viewership. I think that all that news out there, for the people in this room that they understand that a lot of it is not true, or quasi true. I think they are trying to do the best that they can in terms of portray it to the average customer, the average viewer. I would say that, I think that it’s shifting a little bit but still the tone is a little bit negative. The tone isn’t so positive. Hopefully, we’ll see a shift in that towards the beginning of next year.

Adam: I think it’s going to be improved the same way. Up to now, when a news outlet has a story about Bitcoin, I’ve seen either a picture of the Silk Road mastermind, or Bitcoin – you know Bitcoin, those coins and they’re still showing [physical] coins. The reason for that is there is not a lot of heads to show. They like showing talking heads and right now, they don’t have a lot of talking heads to show. With Tesla, they found... you’ll notice, they don’t show the car nearly as much as they show Elon Musk. When we have those innovators, whether it’s people helping other people in the Third World as they’ve never been helped before, or it’s going to be a Silicon Valley company, or a Tennessee company, or a Singaporean company, or an Argentinean company that has innovated in a wonderful way that ends up making its users pleased and happy, or wealthier. Those heads are going to be in the press and that will improve the quality of the story coming out.

Ardon: Don’t you think that that shift is changing where it’s the faces of the Barry Silberts of the world, the Jeremy Allaires of the world, the Andreessen Horowitz of the world?

Adam: You and I live in a very small world. Most people are not reading the newspapers that have... yeah... what I’m saying is, in the public mind’s sphere, I don’t think that they actually could pick out Mr Allaire in a line up, or even Andreessen. Elon, probably.

Izzy: Yeah, I don’t think the media per se... I mean, yes okay, good press, bad press, everybody knows about Bitcoin. It’s getting a lot more public awareness, that’s great but they have not done justice by not giving information to the mainstream community and users everywhere about the social benefits of Bitcoin. We can talk all day long about social benefits and what it can do for all the emerging markets, especially with new merchants and selling goods online etc. I really think that the media outlets and... you know, it’s partly our job as well, to educate these media outlets in order to bring them up to speed and make sure that the information they’re putting out there is harping on about these social benefits because it is a very important area that needs a lot of focus right now. The VCs in the room and the VCs that have been here, we’re talking about all the financial instruments and all the money being pumped into the ecosystem, but what about pumping the money into the ecosystem to actually improve the life of all these other six billion people in the world. It’s extremely important and thinks that that as far as a use case, to as we say now in this talk legitimize Bitcoin. It’s needed 100%.

Ardon: One of the previous groups discussed self-regulating as well, so Andreas, what’s your thoughts on including that?

Andreas: I’m actually a member of the media so I’d like to just touch on that for just a second. I think there’s an interesting possibility that Bitcoin enables the kind of micro-transactions that can give a breath of life to a dying medium. Right now, it’s no coincidence that the corporate mainstream media are obsessing with trivialities and delegitimizing Bitcoin. They are on a mission. They are on a mission to maintain a status quo that allows them to continue to publish trivialities. What’s happening right now is not that the media is delegitimizing Bitcoin, the media is delegitimizing themselves and we have the opportunity, with Bitcoin, to enable the kinds of alternative media that an entire generation of young people are now depending on to get real important information about the world that’s not about the Kardashians. Let the media continue to do their trivialization because quite honestly, there’s another six billion people out there who are going to adopt Bitcoin. Bitcoin adoption is the most important thing – get it out there, get it to other people and keep moving it forward so that more and more people can experience it, and use it, and let the media continue to trivialize and delegitimize themselves.

Ardon: Very powerful.

Andreas: Sorry, I can talk about the other topic but I just wanted to touch on media.

Ardon: I completely agree, especially... it’s interesting how Bitcoin really… it helps rich people, it helps poor people and helps everyone in between. It’s amazing on massive transactions as well as very small ones. One of the previous groups, they talked about self regulation, so I guess, maybe let’s move over to Izzy. What’s your thoughts on Bitcoin self regulation?

Izzy: Okay, I think that first of all, just on the media point, there’s a level of bravado I think among some folks in this community that is warranted because you all are innovating at a level that I don’t think people, regular people, understand. That’s awesome! However, because they don’t understand it, doesn’t mean that you can just dismiss them because some of them are going to be regulating Bitcoin whether we like it or not, some of them are going to be making other policies that shut off avenues that Bitcoin should be able to travel down.

Andreas: I don’t disagree with that.

Izzy: Let me just finish for a second. I think that the better job this community does at educating both the mainstream media and the speciality media as well as policy makers around the world, not just in Washington, the healthier, more open and more vibrant the future for Bitcoin will be. As far as self-regulating organizations, in particular, there are a number of them for lots of different industries. I don’t know at what point the new one that was just announced today and some of the others in this industry... I don’t know how far developed they are... but those could be very important in that education process. I think that to the extent that resources and efforts can be made to develop principles, to develop kind of a guiding post for how this community works, wants to work, should work, that’s important. It’s important to allay concerns by law enforcement, by regulators, by policy makers. I applaud the folks in the room who are looking into that because I think it’s a really important step for an industry that’s growing.

Andreas: Can I briefly respond to that just a second?

Ardon: Yeah.

Andreas: I think it’s absolutely important to do the work of education and that’s been my main focus for the last two years. I think it’s also important to highlight the broad diversity of opinion and personalities and look beyond the English speaking white, male world that Bitcoin has been characterized as. We can all respond to sensationalist media stories by setting the record straight, by demanding corrections and retractions, if necessary and providing them the facts. Also, regularly speaking to journalists to help them understand the interior technology of Bitcoin but also, explain the narrative – the narrative of a system that can bring hope to millions and billions of people around the world - that narrative rather than the Bitcoin as being a den of thieves, pornographers and terrorists. It’s really important to do that but it’s also important to do it for a perspective that’s broader than simply the North American continent. I founded an organization called www.BitcoinPressCenter.org and I’m just going to do my little quick pitch here which is a way for people to find journalists who speak 24 different languages, experts from around the Bitcoin community from every other country, except for North America. That site is getting hundreds and hundreds of media requests. I agree with you, absolutely. We need to bring that message and it’s a message of hope and it’s an important narrative. I’m just saying the delegitimization by media will continue to happen. It’s not an accident; it’s absolutely deliberate.

Ardon: Before you run out of time, I apologise. Does anyone have a question for any of our panellists?

AQ: What’s the name of that organization?

Ardon: http://www.bitcoinpresscenter.org. Thank you.

Question: Andreas in particular, but all of us here at the conference tend to have a very confrontational stance towards regulation and that’s like kind of the way we lean but I think there’s another way we could look at this which is how do we co-opt the same organizations that we are actually scared of. A lot of this is coming out of fear and anger. The question is primarily to the people who have a financial background. What are the services... or what are the things that Bitcoin can do for the large financial organizations that are going to make them greedy enough to want to be part of the plate?

Ardon: Also, let’s try and keep the answers down to like a sentence or two sentences – concise.

Adam: I’ll do my best but I... we don’t work together but I’d like to pitch what he’s doing in a way because... it’s hard to say but it answers the question perfectly. Ultimately, he’s creating a fund, or his company has created a fund that ultimately autoworkers, using their 401(k)s will be able to invest into Bitcoin as part of retirement planning. If in fact, if that investment ends up being more stable than some of the retirement programs that have proved unstable, he could only do that by very much co-opting, I believe, both the regulations and the banking systems that currently are in place. I don’t think that’s the only thing that could be done with Bitcoin, but I think it compliments, very much so.

Andreas: Campaign finance law, actually being able to donate to political campaigns with Bitcoin is going to be a very, very important milestone because then you could co-opt them from the inside. The other one is talking to organizations like the Consumer Financial Protection Board who actually have the best interests of consumers in mind and persuading them why Bitcoin empowers consumers and allows them to protect their assets much more effectively.

Ardon: Also just a comment on that. It would be very interesting to have your political contributions also increase in value 4000% that year because they’ll probably be a little more interested in it.

ABL: First, I wanted to thank everybody for this panel. This was a really interesting panel. My question is very quick. Does China have the right to regulate Bitcoin?

Andreas: I think the beauty of Bitcoin is it’s regulated by an algorithm and that’s owned by no one. That’s the best regulation you can get because it’s predictable, it’s consistent and it’s not subject to corruption and influence.

Ardon: I do think the question though is you can obviously add layers on top of Bitcoin itself. Maybe Izzy, would you have thoughts on what he asked?

Izzy: I’d be happy to address that question in a second. Do they have the authority? Well, they’ve given themselves the authority because they are a legitimate government and they’re going to do it. I don’t know that there’s anything that folks can do about it other than pull out of China. That’s an option. In terms of the layers of regulation, I mean, I think we all have talked about this throughout the entire conference. There are kind of three levels of regulation that we should be concerned about here. The first is the straight law enforcement, fraud, illicit activities etc. that are done via the Bitcoin community. The second are straight rules of the road for payments, for investors – investor protection, for consumer protections etc. The third is something that we haven’t really touched on too much and that’s taxable authority and how the IRS treats large increases in your cash portfolio based on Bitcoin increases. I think that that’s a very legitimate concern that a lot of folks are going to start to have as investments in Bitcoin in the U.S. increase. That’s a longer answer than you want but there it is.

AQ: I would just like to ask what are some of your favorite Bitcoin charities or services for charities, in general?

Andreas: That’s a great topic because we didn’t really touch on transparency. One of the great features is the public ledger and blockchain is that you can enable transparency for charitable organizations. That kind of policy is infectious because it will put pressure on organizations of public responsibility, including public listed companies, to implement radical transparency for their public accounting. I think that would be a very powerful force.

AQ: One thing that I haven’t heard addressed at this conference is the idea that Bitcoin is a huge creator of wealth at the moment. I could see it becoming a destructor of wealth, in terms of just accelerating possible collapse of fiat currencies. Is that not a cause for concern for say, the other six billion, or the person who just doesn’t know how to open up a Bitcoin wallet and get in early enough?

Adam: It was Wayne Gibson who had the great line – The future is here, it’s just not evenly distributed.

Andreas: Nicholas Negroponte of the MIT Media Labs said that, yeah.

Adam: Who? (Laughter)

Andreas: Nicholas Negroponte said that.

Adam: Did he? ...thanks.

Ardon: It’s a good quote. It remains a good quote.

Adam: Well, there’re no maps for these territories. In any case, no - I think to a certain degree, it’s unavoidable. There has always been disparity of wealth. The question is, is how much can we try to avoid the kinds of disparities we don’t like. If, in fact, Bitcoin causes a disparity of wealth that you’re talking about, it’s certainly not going to be straight along traditional lines. If it brings more wealth and capability of ease of financial well-being to more people, then okay, because it won’t be avoidable in any case.

Andreas: Bitcoin is going to get adopted in the places where it has the highest utility versus the local currency and in most places in the world, they have some really, really crappy currencies that are... you know, we think Bitcoin has volatility? Our volatility is going up. Most of these currencies have volatility but it’s going all the way down. These are problems that are really kind of first world problems, if you like. For many of the nations where Bitcoin may have a tremendous impact, the real question is – can we support it without electricity? Can we support it without continuous access to the blockchain? We need to down-tech Bitcoin in order to make it accessible to more and more people but for them, it has an impact and quite honestly, their currencies are really much, much worse.

Ardon: Yeah, especially getting involved internationally with Bitcoin, the more companies that I talk to from different places, one for instance, is the Caribbean. They have the Barbados dollars and it’s pegged to the dollar and so when we pump money, they have to pump money as well. That money is not backed by anything and actually, they went from a high credit rating to absolutely junk dollars. The exchange there wants to just siphon the rest of the value out of it.

Andreas: What is our money backed by exactly?

Ardon: The good faith in the American government.

Andreas: So, nothing, right?

Question: I don’t have a question but I would like to direct this story to Ardon. I would like to hear what he has to say. I am avid researcher and truth seeker. I see Bitcoin as a way to bring freedom to the world, I would like to bring to everyone that if you think Bitcoin is going to waltz into the present banking system without a fight there's going to be huge resistance coming in the future when they see the power that Bitcoin has and I think all Bitcoin people need to stand together, we need to forget about Republican, Democrat, we need to think about who actually stands and signs or represents a cause and in which way they stand. I voted Democrat in the last election. I will never vote Democrat or Republican again. I will vote independent. I always took the lesser of the evils but I think a wasted vote is when you don't know vote where it belongs.

Ardon: Vote with your wallet. Vote for Satoshi Nakamoto.

Question Continues: And one thing I'd like to add, do you remember the Tucker Automobile. He came with a better idea and he invented the seatbelt but when he came up to the powers to be they squashed him like an ant.

Ardon: Last sentence.

Question Continues: I would just like to hear what Ardon has to say about how we're going to unite to make sure that because when China….

Ardon: How we're going to unite is where we're going to finish this with a round of applause for our wonderful panelists. And we're going to reunite next year and I'm sure the second annual insider Bitcoin, my company which is misspelled there will enable you to gamble here and hopefully book your hotel as well as we're in discussions with MGM. So, I'd like to think our panelists, they've done a remarkable job. This was definitely very interesting and a final for Stewart.

Stewart: Thank you, guys. Thanks for sticking around. You guys were amazing. I want to thank Lauren, Emily and Nicole who did all the registration. I want to thank all the panelists, all the speakers. See you guys in I don't know in Berlin, New York, one of those places. Thanks a lot. Cheers.

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