Video - Bitcoin Design Principles - IDEO Lab Presentation

In this talk, Andreas looks at the design principles, metaphors and words used in Bitcoin and how they relate to the user experience. Andreas tackles about Bitcoin technical perspective and systematic way to be still despite of the economy's ups and downs.


Andreas: Alright. Good morning, everyone. Can you hear me? Is the microphone working? Okay, great. Wow, what a difficult task you have. At the very basic level you have to try to understand what is Bitcoin and I can answer that question in five words. What is Bitcoin? It's digital money but that doesn't really capture. It's more like the Internet of money but really it's a consensus decentralized network based on blockchain technology and a proof-of-work algorithm that allows a digital token to act as a reward system for a game theoretical competition between these centralized miners who validate, oh, my God, and it immediately goes off the cliff, right? The answer to the question what is Bitcoin, I've answered it it's a 300-page book and when you read that book you'll start down the path or if you read that book, you'll start down the path of answering the question what is Bitcoin and then you'll find after a couple of years that you're still trying to understand what is Bitcoin. And part of the reason for that is because Bitcoin is a really new technology. It's a really disruptive technology but it also is an abstraction on a technology that's really old and that technology is money. So money is a tool to technology and actually shares commonalities with linguistic structures because we use it almost like a language to communicate the value of money among ourselves, right, in a society. So who wants to tell me here how old money is, any idea, anyone?

Unknown: 5,000.

Andreas: Okay, that's a good guess. A bit older, try again. So the problem with trying to understand the history of money is the money is older than history. Oops. We could go and look at the writing about money. Money is older than writing. Now that may confuse you a bit. You're like money's older than writing that can't be but, in fact, if you look at the first forms of writing that we find, there spreadsheets, there are counting ledger's. The first thing scratched on to tablets created with twigs and things like that are accounting ledgers. They represent how many * 0:02:52 of oil were given to the Pharaoh and if you go even further back, we find ancient forms of money among the ruins of ancient civilization, beads, feathers, shells, giant stones. Money has taken many forms but it exists and has existed almost as long as language. This is a truly ancient technology. So it's not 5000 years. It's probably close to 500,000 years old. In fact, we see money emerge within other species. Highly intelligent species like primates, certain types of birds like crows, even marine mammals like dolphins have forms of tokens that they use to express value to each other or they can very quickly learn the mechanics of money. You can teach primates that if you turn in this pebble you get a banana and then watch within a very short period of time how that not only becomes part of the primate culture but gets passed down to the next generation and they start inventing economic activities, not nice economic activities. They invent strong-arm robbery, beat up the other monkey take its pebbles and you can get bananas. They invent sexual favors for pebbles so you can get bananas. They invent some of the earliest economic activities.

Money is ancient. It's an absolutely ancient technology and none of us really understand it. When you start trying to explain Bitcoin what you suddenly realize is that most people don't understand money. Even though it's something that you start learning about at a very, very young age, but even adults don't understand it. If you want a demonstration of that fact sit down and have a conversation with a four-year-old and try to explain money and you will find out very quickly the four-year-old has some very good questions that you can't answer and you can watch parents go through this. It's hilarious. Mummy, where does money come from? The banks make it. Well, how do they make it? Well, they print it. Why can't we have more then? Go clean your room. You're about four questions from go clean your room with any money conversation because adults don't really understand money. Very few adults really understand how money works, even though it is a cultural artifact that has existed in our species for hundreds of thousands of years. We don't understand how it works.

We've gone through several technology iterations with money. We've started from very basic forms of money and these basic forms really had certain innate characteristics that made them good as money. So what makes good money? Something that is rare, shells, feathers. You can use shells as money unless you live on a beach. If you live on a beach you can't use shells as money, right? You can transport the value easily. So it has to be portable. With a few exception, most forms of money are highly portable. If the amount of money you need to go and buy a cow is heavier than the cow, that's not very good money, right, which is why we don't often see, for example, gold being used for large transactions. It's too damn heavy. Other characteristics of money has to be difficult to forge. It has to be difficult to create more of it. You should be able to detect at a glance or relatively easily that it is real. It should be fungible. If I'm using shells then this shell and that shell are both the same money. If I give you a dollar it doesn't matter which dollar I gave you, it's fungible. Every dollar can substitute every other dollar. So these are the technologies and gradually over time we've created abstractions. Money itself is an abstraction. If it's not an abstraction then it's not money. It's barter. If I give you bananas for your goat that's not money. The bananas are not money because you eat them. You don't use them to do further exchanges and therefore that's barter. You're exchanging one commodity for another but if it's abstract, if it doesn't have any practical use in itself, then as an abstraction of money it represents something else, some shared value which leads to the one inescapable conclusion about money. Money is a shared cultural hallucination. It's a shared delusion. We walk around and associate with other people on the basis of germ ridden written pieces of cotton printed with green ink and if you were to observe that as an alien anthropologist who landed on earth, you'd think it was very, very weird that just by exchanging these pieces of cotton you could create social relationships and transactions and trade, feed yourself, shelter yourself, etc, etc. It doesn't make much sense but it's based on a shared hallucination. It's based on the assumption that if you give me a dollar today, someone else will accept that dollar in exchange for something of value tomorrow and if I still believe that is the case that it has value. 

Value comes from the assumption that I can use it again. And what bitcoin is is just the latest iteration of abstraction. So we’ve done abstraction and every time we do abstraction of money, society freaks out. Because this new thing can't possibly be real money. Go back and look at what happens with the introduction of coins stamped on to non-precious metal and then eventually paper notes. When paper notes were first circulated no one believed that they had value, the shared hallucination have not taken hold yet. And it was very difficult to persuade people to exchange real gold coins or silver coins for pieces of paper that said that they had gold in the vault, and then taking a step further, disappear the gold from the vault and say, turns out it's just a paper.

You ask people about Bitcoin and one of the first things I hear from most people is it's not real money because it's not backed by gold like the US dollar, which I find astonishing. The dollar hasn't been backed by gold since 1936. And yet, most people think that somewhere in a vault, possibly Fort Knox or some other movie location, there are bars of gold that corresponds ingots to ingots to the pieces of column paper you have in your pocket and they don't. There's no such thing. Why is Bitcoin money? Because other people think it's money. You could write a dozen PhD dissertations explaining exactly why bitcoin is not money and I have lived on it for two years, and therefore it doesn't matter what your dissertation says because to me it is money because I have lived on it for two years, and so have thousands of other people and therefore to me it is very much real money. 

So you've been tasked with creating designs and concepts around the oldest technology in the world that very few people really understand and its latest most abstract expression that is brand new is completely disjointed from previous expressions of money and is extremely complex as a technology. That is a really difficult task. When faced with that task, your go-to technique is the use of metaphor. Design metaphors are extremely powerful tools. They allow us to create expectations. Metaphors are tools by which we create expectations. When you have a desktop computer and it has a desktop, you assume that something will happen when you drag something across the desktop. Because you've actually used the real desk that assumption will inform your expectations, right? You expect it to behave like the object is pretending to be. That's a design metaphor. 

Design metaphors are extremely powerful but they're also extremely dangerous when misapplied. And in Bitcoin, every single term and design metaphor is absolutely 100% wrong and broken. Let's go through the list. You've probably struggled with this as you've engaged with this technology of Bitcoin and looked at all of the terminology. First of all, a wallet. What is a wallet, anyone? A wallet is something that stores money? Not in Bitcoin it isn't. The money isn't in the wallet. The money is on the network. The wallet contains keys so it's not a wallet. It's a keychain. How can you tell that's not a wallet? Can you copy a wallet? No, but you can copy a key. A keychain is a far better metaphor because if I have a keychain, imagine a big ring of keys like janitor or a custodian, right. I have a bunch of keys, I can go to a shop and have all of those keys duplicated and create a second keychain. Both of those key chains will work interchangeably in all of the locks of the original keychain worked. That's how a keychain works.

So if you understand what a keychain does, then you will understand how a Bitcoin wallet works because you can copy it, you can make copies of the keys. If you give someone a copy of a key, they can open the door, right. They don't need your permission anymore to open the door. So wallet is not a wallet it's a keychain. That's a terrible metaphor because you have expectations of what a wallet will do. It will contain things. These contents will be discreet and enumerated. None of that exists in Bitcoin. So let's get down to basics. Bitcoin. Coin, what a terrible, terrible word! What a terrible brand! Coin. Take the most abstract form of money we've ever created that is based on a completely decentralized network that has no coins and then name it Bitcoin just to confuse everyone. A coin which is two generations of technology back and far less abstract much more tangible, physical representation of money. So you took the most abstract representation of money and you named it after the most tangible representation of money. Only an engineer could come up with that brand.

Here's a little secret, there are no coins in Bitcoin. When miners mine, they don't create coins. They create ledger entries. Those ledger entries do not enumerate coins. They have outputs, transaction outputs, which are chunks of value that are infinitely divisible and recombinable. Coins don't do that. You can't track a coin in Bitcoin because there are no coins. So you've got a wallet that doesn't contain coins because the coins are actually in the network only, they're not coins, they're outputs and what you're really holding is a keychain. Transactions are not from a sender to a recipient. Addresses don't have balance in Bitcoin. There is no such thing as the balance of an address. An address controls output and if you trawl through the blockchain and add up all of the outputs you can figure out some notional balance whether that's actually spendable or not, how much it is. It's actually quite difficult to determine, there is no balance. You have no account in Bitcoin. All of the terms of broken. All of the terms are wrong. And the problem with that is that from a design perspective, instead of the metaphor informing our expectation it is misinforming our expectation. It is creating the grounds for massive misunderstanding because we think it's going to do something in a certain way and it ends up doing something completely different, something unexpected. Kind of like the Windows desktop, right?

I don't know if you've ever compared a Mac and the Windows desktop. Windows desktops have no consistency. The metaphor is completely broken. You expected to do one thing it does something completely different and confuses. The essence of good design is picking the metaphor that informs expectations fast. Here's the next big problem with metaphors and design. There's a certain concept called skeuomorphic design. Who's heard of skeuomorphic design? Great. Who thinks I pronounced it correctly? Okay, not bad. It's a Greek word. I don't pronounce in Greek. I don't know how to pronounce in * 0:17:59. Skeuomorphic design is when you take… so the word skeuomorphic means a shadow of its former self, right. It's form as a shadow. What it means is when you create elements and design that give you references or hints of some previous form. For example, classic example, the first iteration of iPads, the software, the iOS software had a lot of skeuomorphic design. If you open your contact database it was bound in leather. That leather had stitching. That stitching didn't do anything, right. It was just a design element which had no functional purpose whose intent was to put you into a familiar set of mind so that you can understand the metaphor.

When you're playing a card game on your computer and it has fake felt under the cards that's because it's trying to draw out the metaphor of a casino by introducing this design element. Skeuomorphic design is extremely powerful. It's also extremely dangerous because if you don't use it correctly, again, what it does is it creates different expectations as to what's going to happen next, all right. So in Bitcoin we have a lot of skeuomorphic designs, and my favorite and most hated form of skeuomorphic design is the picture you will see at every single article written about Bitcoin, a pile of gold coins with a letter B on them. Usually the Cassation coin designed by Mike Caldwell but possibly some other rendering of that. Taking the worst design metaphor for Bitcoin, the word coin and then instantiating it in a beautiful rendering that makes it even more physical-looking in a skeuomorphic design that completely misleads everyone. Because people are actually going out on eBay and they're buying Bitcoin. They're buying gold-plated physical coins that have nothing to do with the blockchain but have the letter B stamped on them. And then they're like, look, I’ve joined the revolution of digital money with a perfectly tangible replica that has no value in Bitcoin. This is the result, and then people write these articles and they look at the picture and they think so that's what a Bitcoin looks like and that's not what a Bitcoin looks like. If you remember previously I may have mentioned there are no coins. So this is the danger. 

It's a really difficult task to design good metaphors for Bitcoin because there is no parallel, because we've never done this before, and we fall into these traps of trying to extrapolate from our previous experience and fallen short. Destructive technologies do this. In an incremental technology, if you take what you currently understand and then just use a milligram of vision and extend it just a tiny bit, you understand the new technology because it really is just a slight extension of the past. Bitcoin is a radical break from the past and so understanding the way traditional money works doesn't help you understand Bitcoin. If anything, it hinders your understanding of Bitcoin. The people who understand Bitcoin the least are monetary economists. They cannot wrap their head around it and they will write long thesis on how Bitcoin is not money despite the fact that I've been living on it for two years.

So understanding disruptive technologies is even harder than understanding incremental technologies because the most interesting things they do have no previous parallel. Think about it this way. Who here is a fan of Star Trek? Am I the only in the room? All right. Great. Look back at Star Trek in the 1970s, what did they get right? They've got triquarks. They’ve got portable communicators. They've got video telephony, right. They got all that. That was predictable with the technology of the 1970s. They couldn't possibly get the Internet. They couldn't possibly understand the idea of networked information stores. They had fantastical computers that could talk to you but they didn't have access to any data, right. They couldn't possibly predict things like social media and most importantly if you pay attention you will notice something very strange. Star Trek doesn't have any money at all. There is no money anywhere in the Star Trek universe. Why is that? Because their furthest vision of the possibility of society is a society without money, a society without the language for transmitting value, which is probably the most radical departure from reality. So when we try to predict the future, there are certain areas that are completely dark to us. These are the areas that have never ever been seen before. These are the applications that we cannot imagine because in order for them to come into being, many things have to fall into place.

For the web to happen you needed a common standardized transmission protocol. For the web to give birth to social media, you needed massive penetration of basic email and TCP/IP connections. You needed penetration of those connections on an always-on state. You needed the ability to have mobile devices with high density computing in the palm of your hands that were Internet connected. All of those things had to come to fruition before social media was even possible. And so if you look at the Internet in 1992, you think that it will replace the phone because that's the only experience you have. The Internet is a fancy phone. Maybe it's a fancy phone fax, perhaps a multifunctional printer fax phone, right. It's very fancy, and so the phone companies look at this and they say, oh, it's a fancy phone. We can do this. They were wrong fortunately because otherwise every time I went to a Skype call, there'd be a little slot in the side of my computer and I would have to deposit quarters every three seconds to make a Skype call. Fortunately, the phone companies didn't get to write the rules. They couldn't possibly predict the outcomes we saw on the Internet because most of the interesting things were not incremental improvements or extensions of the things before. They were radical departure from the past because they created the conditions for things that were not possible before. So now go back to Bitcoin and think about this for a second. Look at the wall around you and what we've been talking about, financial transactions, banking, payments. It's a fancy credit card. It's PayPal basically. It's a global PayPal but it's not. It's not. It's something completely radically different but we can't even see where that's going to go and the applications that are going to happen on Bitcoin, the really, really interesting applications are applications that can only happen when you have sufficient adoption and penetration of this technology, the ability to do cross-border transactions on the level that has never been done in the history of humanity before.

Today there are three billion people with no banking facilities whatsoever. Three billion more people with very limited underbanked as we call them without any access to international credit, international finance. You and I can go to a brokerage website right now and within 24 hours have a US dollar denominated account that can trade on the Tokyo Stock Exchange. That is privilege. That is a facility afforded to less than a billion people in the world, one out of seven. The other six billion, they barely have basic checking if that and a lot of them live in cash or barter based societies. So the question then you have to ask is what happens when a farmer in Kenya who has a Nokia 1000 text messaging phone and suddenly that phone is a Bloomberg Terminal, is a loan origination terminal, is a Western Union remittance termination terminal, is a stock market, is a bank, not a terminal to a bank but a bank on the phone and that is afforded to the other six billion all over the world. Part of the reason Bitcoin is unstoppable is because there is this great need for this technology.

All of the banks in the developing world cannot extend services to these populations. I was talking to a Brazilian banker who told me half our population is a hundred miles from the nearest branch upstream on a canoe and we can't serve them, but even the remotest village in the Amazonian Basin has a cellphone tower and someone in that village has a solar panel and a Nokia 1000 text phone. There are more Nokia feature phones in the world than any other kind of electronic device. It is the most massively produced device humanity has ever produced. Almost five billion people have access to cellphones. Almost three billion people have access to cellphones and do not have access to safe cleaning water, safe drinking water. Think about that. Cell phones are more widespread than water on our planet. So what happens when each and every one of those is a banker? For me, the vision of Bitcoin is not to bank the other six billion, it's to unbank all of us. We can do it. Banking is an app but that's just the beginning. The really, really interesting things in Bitcoin happen in what I call interstitial innovation, the innovation in the gaps, the places where today's systems cannot go.

Technologies have an interesting effect where they suddenly change basic assumptions. So some of the most powerful things that happen on the Internet happen not just because of connectivity but because of the marginal cost of transmitting information over distance. So before the Internet, moving information from Point A to Point B costs a lot of money. The Internet drove that cost almost to zero. The result of that was that millions of applications that could not happen on the previous cost basis even if we could imagine them suddenly became possible, right. Why on earth would you stream music instead of buy it and store it locally? Because it costs nothing, right. And once it costs nothing and you can stream music then you suddenly realize that ownership kind of overrated. If an entire generation realizes that then intellectual property kind of overrated. Bye-bye, recording industry. These effects happen because the technology changes fundamental cost of doing things.

So let's think about what happens when Bitcoin changes the fundamental cost of transacting, transacting across distance, transmitting value, recording information and recording information in an immutable way. What happens when for the first time ever there is a system that can evaluate rules without human intervention and be trusted without having to put trust in any single human? In Bitcoin, we call this the removal of counterparty risk. If I create a transaction and I sign it, everyone on the Bitcoin network can validate that transaction independently. They don't have to ask anyone. They can go through the blockchain on their own machine which they know is correct and true because they have been tracking it and building it based on proof of work, and they can check that transaction 350 bytes and they can validate that that transaction is in fact valid without asking anybody else. A self-verifying system, a system of rules that exist independent of human actors, that exists based on this network topology. What does that mean? What does it do to commerce, to transactions? We can understand what it does to banking. We can understand that Western Union is going down hard this decade. Yeah! You charge thirty percent on the poorest people in the world, you deserve to go down by disruptive technology. Last year the CEO of Western Union said in the medium term we are not worried about Bitcoin. I want that framed on my wall. It's one of those phrases like the boss of Kodak saying things like that when Nokia took away their lunch, right. Kodak was the largest camera company in the world until a company that wasn't in the camera or business shipped a billion cameras in one year and destroyed their industry and they never saw it coming.

Nokia by the way is the world's largest manufacturer of cameras by far. That's going to happen to Western Union but this is the easy stuff. What happens when you are able to do this validation of rules without a third party? It changes several fundamental societal institutions that we have today. It changes what's called the cost coefficient which is the overhead created by organization. If we want to do something as a team, right, two people can do more than one person can do, three people can achieve even more but there's a limit to that. Once you get too big, the communication overhead between participants in the group is greater than the marginal increase in efficiency, right. So adding more people makes it worse because the group is now getting bigger too fast. You guys know what I'm saying? Bitcoin changes that because it now reduces the coefficients of organizing on a transactional, on a commercial, on an independent validation basis in extremely large scale. We can now get about a million people about five thousand machines to agree on the state of a ledger every ten minutes at extremely low cost. That has never happened before and it opens the door for things that we cannot imagine.

Bitcoin is radically discontinuous with the past. Let's take one simple example, personhood. Personhood is required for financial ownership. In order to own money, in order to control funds, in order to have a bank account to receive a bill, to pay someone, you must be a person. Everywhere in the world in every payment and financial network that exists, people own money. They may own it in the form of corporations but that's just people grouping together. They may use proxies and agents and things like that but that's just people working together. Bitcoin does not require personhood. A software agent can own money. A piece of software can be autonomously controlling money without any human intervention. This is completely unheard of in the history of man. We've never seen what happens next. 

Here's a little thought experiment. Let's take three radically disruptive technologies and mash them together, alright. Who's heard of these? Bitcoin, yes? Uber? Self-driving cars? What happens when you mash the three together? I give you the self-owning car. A car that pays for its Toyota lease, its insurance and its gas by giving people rides. A car that is not owned by a corporation, a car that is a corporation, a car that is a shareholder and owner of its own corporation. A car that exists as an autonomous financial entity with no human ownership. This has never happened before and that's just the beginning. I can guarantee you that one of the first distributed autonomous corporations is going to be a fully autonomous, artificial intelligence based, ransomware virus that will go out and rob people online of their Bitcoin and use that money to evolve itself to pay for better programming, to buy hosting and to spread. That's one vision of the future.

Another vision of the future is a digital autonomous charity. Imagine a system that takes donations from people and using those donations monitors social media like Twitter and Facebook, and when a certain threshold is reached and it sees a hundred thousand people talking about a natural disaster, typhoon in the Philippines, it could marshal the donations and automatically funds aid in that area without a board of directors, without shareholders. One hundred percent donations go directly to charitable causes and anyone can see the rules by which that autonomous altruistic charity works. We are beginning to approach things we have never seen before. This is not just the currency. Now let's look at how the Bitcoin community is addressing this incredible potential with their design choices and metaphors? Oh! boy, it's a mess. Let's take a simple example. How many of you had an experience with a Bitcoin ATM or BTM as it's known? Okay, how was that experience? Who enjoyed it? Nobody. Great, that's about right. What is an ATM? ATMs have been around for 25 years now. What purpose does an ATM serve? What is its goal? What is its purpose?

Unknown: Cash dispensary.

Andreas: It's a cash dispensary. Okay. So when you interact as a person with an ATM 1) you have a pre-existing relationship with the bank or financial institution. 2) you have a pre-existing balance 3) your primary objective is to get in, get a cash, get out. Twenty seconds is too long. Three clicks is too long. The most incredible innovation in ATMs in the last 25 years has been fast cashing. That's it. They haven't really changed much. You press a button. Now, I can get cash in one click. Wow! Fifteen seconds in and out. And why is this important? Because one of the primary uses of ATMs is at one o'clock in the afternoon, a hundred people line up in front of four or five ATMs in the center of town and all try to take out twenty dollars to buy lunch, right. You see this all around the world and so what is the purpose of ATM? For a bank, the purpose of ATM is reducing the overhead of having a human and reducing the interaction to the shortest possible time for someone who has a pre-existing relationship with that bank.

What does that have in common with a Bitcoin ATM? Absolutely nothing. So, now let's look at the experience of a Bitcoin ATM. The average user of a Bitcoin ATM is someone who has never seen Bitcoin before. It is a person who doesn't understand what bitcoin is and the ATM is their first introduction to this currency. It is a person who does not have a pre-existing relationship with anyone in the Bitcoin space. It is a person who does not currently have a wallet because they didn't know they needed one, because they don't know what a wallet is. It's a keychain. And so they walk up to this machine and this machine has been designed by engineers to simulate the experience of an ATM even though the experience shares absolutely nothing with the use case we're putting it to.

So you walk up and the ATM tries to give you Bitcoin in as few clicks as possible with the minimum amount of interaction. Is that a way to build brand loyalty? Is that a way to build user experience? Is that a way to introduce new users? I mean, it just throws it at you and you're not ready for that, like, please open your phone and display your QR code, like what, what's a QR code. I don't like -- what -- my phone does – okay, hang on a second let me go to Google Play and search for QR code. There's an app that scans them maybe I should use that one. Shouldn’t I use that one? Maybe I should use a Bitcoin wallet. Oh, there’s 26 of them, which one's the best? I don't know. Oh, I'll use Circle. It requires a pre-existing relationship. Oops. Use Coinbase. Oh, it requires a pre-existing relationship. Oops! And now, finally I've got my wallet and I display the QR code, put some money in and send this to Bitcoin, got the Bitcoin. What the hell am I going do with it?

I have all these questions. Who takes Bitcoin? Where can I spend this? How do I send it? How do I secure it? Will it get lost if I lose my phone? I have no clue. Why? Because this bloody infernal machine didn't tell me anything. It just threw the Bitcoin at me and in fifteen seconds, it's like off to the next customer. So, if I was designing a Bitcoin ATM, first of all, I'd put it in bodegas. Secondly, it wouldn't have a lick of English on it. It'd be all Spanish because I'm going to really push the remittance model. Thirdly the first function on the ATM would be send money to Mexico City. That's it. Because I want people to use the Bitcoin for something. Thirdly, I'd have a big button on the front that says talk to a human. 

I've got an Internet connected device with a forward-facing camera and a tablet screen and I'm not using it to do video customer service, are you kidding me. Boom, Skype, a person, what the hell is Bitcoin? Where do I spend it? Oh! Sir, I see you're in the bodega on 25th Avenue. There are three stores that take Bitcoin in your area. Let me show you a brief introductory video. Gather all the children in the store and we can all dance the little Bitcoin song. Let's watch another video. I don't want to interact for fifteen seconds. I want to interact for two hours and get all of my friends to sit in front of the machine and watch the little Bitcoin videos and learn about Bitcoin and it's got pretty colors, and it tells me where I can spend it, and it gives me suggestions on wallets, and it can send them directly to my phone, and it's building loyalty and brands and experience. That's not a fifteen seconds interaction. You have the possibility of placing this device that is the first experience people will have with Bitcoin. You fucked it up from the get-go and you have the opportunity to make this a deep meaningful educational experience.

Here's another little clue. Get them young. Get them young. On average around the world the earliest age at which you can open a bank account to sixteen years old. By the time that sixteen-year-old goes to the bank, I want them to have at least six years of active Bitcoin use in their experience because then when they face their first banker they're going to be, oh, my God, three to five days. Business days? What the hell is a business day? What do you mean you close at five? I barely got off work at five. What do you mean I have to pay for you to store my money? Okay, this grandpa crap, I'm not touching it with a ten-foot pole. I'm never doing banking in my life. This is ridiculous. Have you people even heard of Bitcoin? That's the experience I want. And guess what? Ten year olds are opening Bitcoin accounts. Do you know why? Because they can go download the app on the Internet and they can be in control of money for the first time.

So you need to have the birds and bees discussion but you also need to have the private keys discussion because your ten-year-old is going to get in a whole heap of mess trolling around the Silk Road asking, Mommy, what's black tar heroin because I just ordered some, it look like chocolate. Ten year olds will have Bitcoin accounts and for many young people this is a huge generational divide. For many young people Bitcoin will be their first economic experience and by the time they get to a bank they will be done with banking in advance. That's a huge advantage. Get them young. So how do you appeal to a completely new demographic? Part of the trick is not trying to be a bank. Do not try to do anything related to traditional banking because all that does is pollute their minds, right. You want new users to have a brand new experience with Bitcoin that is unlike any banking they will ever see. You don't want it to look like a checking account. God forbid, you use the word checking. Open any one of the exchanges right now. Circle, Coinbase. Open them up. What is the name of your account on Coinbase? It is the checking account and it has a balance and it shows you a statement. Who the hell did they hire for this design? What does the word checking mean? It means an account on which you can write checks.

Now, I know this is America and we're 25 years behind on FinTech, the rest of the world doesn't do checks. I can guarantee you. What is a check? A check is a device by which a grandma can make 20 people in line behind her the supermarket simultaneously groan. That’s what a check is. And I use it to pay my rent every month, I don't know why because I can't do it any other way. And it's insane, it's insane that I'm signing a piece of paper and sending it through the postal system in 2015 for God's sake. So that my landlord can then walk it to the bank and deposit it so that it might clear three to five business days later after they've charged him five dollars to own his own money. We don't really need a hard sell to make a Bitcoin win on the banks. All you need in order for Bitcoin to win against banks is for a person to use Bitcoin for a week and then the bank will take care of the rest. They'll freeze their account. They'll tell them they're closed. They'll hold it for three to five business days and you just sold Bitcoin. Banks will sell them for you every single time.

I was invited to do a talk at the Bundesbank. Have you heard of the Bundesbank, the German Federal Bank? They were paying me for this speaking engagement but they don't know how to do Bitcoin, which is a real problem because I usually get paid in Bitcoin. So we agreed to do a wire transfer, it took sixteen days. I sent them the details. Actually, no. First, they asked me for my account number. I gave them my account number. Then the next day they came back and they said they need the Swift number. By that time my bank was closed so I couldn't get the Swift number. The next morning, I got the Swift number and I sent it to the Germans but by that time their bank was closed. The next morning, they used the Swift number and discovered it was the wrong Swift number. It was the Swift number for US dollars not for foreign currency. So they sent me an email but by that time my bank was closed. So, the next day I got the other Swift number and I sent it to the Germans but by that time their bank was closed. They sent me the wire. My bank took one look at this wire and said, Bundesbank, never heard of them, sound dodgy. Let’s freeze this for 14 days just in case they bounce. Like this is the third-largest central bank in the world. This is the German Federal Bank. They do not bounce checks. All right. So 14 days later and this is the great part, they said money held money released. They released eighty dollars of the total amount which was a four-figure amount. Eighty dollars. Why eighty? What the hell is that? What am I going to do with -- I mean just hold all of it. Are you teasing me? This makes no sense. This is what we're addressing with Bitcoin.

So if you're introducing a new product in this market and you're a designer, which parts of this design metaphor do you want to reuse in your product. According to the Bitcoin marketplace, all of them. So that you can persuade people that this is just like your bank. It doesn't have any of the good parts of a bank, like the ability to easily reverse transactions, to get a refund if you lose your private key, doesn't have any of those. It also doesn't have any of the bad parts of banks but we don't pay attention to that, and so we've created expectations that are entirely misleading. Bitcoin desperately needs design, desperately, desperately needs design. It's been created by engineers and it is absolutely inscrutable but I have hope. I have hope because we've done this before.

I got on the Internet in 1989, and at the time it was illegal to use commercial activities on the Internet. It was owned by the National Science Foundation and it was only for academics or let's say 15-year olds who happen to find the password to an academic system. And at the time, DNS was still in its infancy. Most systems didn't really have DNS names assigned yet. It wasn't very well structured. So a lot of the most interesting things you could only find by IP address. So I walked around with a list of IP addresses in my wallet so that I had access to these things, and then in order to use it it required UNIX command line skills. Now, there's absolutely no way that was going to get used by my mom. No way. Absolutely no way. My mom called me and told me her stereo was broken and I tried to figure out why, and she told me it's displaying an error message, it's blinking at me zero colon zero zero. It took me a few minutes to figure out she had pulled the plug and the clock had reset and so the clock was waiting to be set again and was blinking zero colon zero zero. That's the person who I wanted to use the Internet so we could talk but that wasn't going to happen. It took almost exactly 20 years from the day I sent my first email to the day my mom sent her first email. And in order to do so, a lot of things had to happen. Most importantly the iPad. Because she was able to do it with a swipe of a finger and that's the only thing that made it possible. There was no way that Internet could be used by mainstream.

There's this fantastic TV show, I think it's called the Morning Edition or one of those morning shows on CBS in 1995 where the journalists are in a huddle just before show and it's an outtake of them discussing the upcoming Internet story. They're trying to get their information right. So one journalist is asking the other journalists. So wait, the Internet's the thing with the at sign? No, no, no that's email. The Internet is the thing with the www with the dots and the slashes. But I thought that was email. No, no, that's the Internet. But isn't that the web? And so there's this circular discussion system designed by engineers, right? Inscrutable. Two things happened. One, we made the technology much easier to understand, much better, more polished but another important thing happens, society moved. Today, the average person knows exactly the difference between an at sign and the www even though it's a horrible design. Society learns the language of the Internet because it was valuable enough to learn the language of the Internet, and so while we made the Internet easier, society caught up and also understood the really inscrutable parts of the Internet.

The same thing is happening with Bitcoin. I go to conferences, mainstream conferences where they've never heard of Bitcoin before and I say listen, don't worry someone in your life can explain Bitcoin to you, when they're done cleaning their room ask them to teach you Bitcoin because their ten-year-old will understand it. They're probably all up in that hut. I've met kids -- very hip, right. I've met kids who use web-based interfaces to create altcoins of their own. One of the interesting questions I get often is how many coins and currencies will there be, and the answer to that is exactly equivalent to how many bloggers will there be on the Internet. All of us, right. All of them, not hundreds of coins, thousands, tens of thousands of coins. When a six-year-old can create a coin called Joey Coin to launch in their school as a popularity contest, the fact that that coin is also global, unforgeable, scalable and can be used internationally, doesn't matter to Joey as long as his five friends really like to use Joey Coin. A week later unfortunately a competitor Maria Coin is launched on the scene and an old-fashioned currency war starts. This is going to happen. Part of the reason we know this is because children create currency. You leave children in a kindergarten by themselves and they will invent currency, rubber bands, Pokémon cards, little cubes. They will start hoarding, trading, exchanging for favors and then eventually getting into a fight over their imaginary currency that they just invented. This is a human experience. What we just invented the world's most awesome currency and your job now is to create the right design metaphors to make it work for everybody else. Thank you.

Written by Andreas M. Antonopoulos on February 3, 2016.