Gavin Andresen on this video explains what are the most common misconceptions about Bitcoin. He also share the future of Bitcoin in the next 15-20 years.
Transcript
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so will Bitcoin be here in five years Bitcoin will definitely well here right here in five years I hope that Bitcoin will be here in five years um I think nobody knows how big it will be but I'm pretty sure that at Tech conferences around the world you will be able to buy stuff with Bitcoin in five years so um you know people most people probably know a bit about Bitcoin I think it's becoming a little bit of a household word not really sure but um what are the what are the biggest misconceptions that are still out there about Bitcoin I think Bitcoin is starting to go mainstream I mean it used to be when I just I talked to tech people like the people at this conference that you know they would know maybe what Bitcoin was I think the biggest misconception is still that it's some deep dark mysterious thing for kind of illicit markets and I think that's a that used to be a reasonable misconception and maybe it really was actually reasonable conception because I think one of the first markets that Bitcoin was useful for actually was the the black markets I think we've evolved way past that and we see you know huge companies like Dell computer accepting Bitcoin for ordinary products that people want to buy and so I think we're we're quickly evolving from something that was a little bit Shady to start to something that is much more mainstream much more accepted uh it's much easier to use use so let's go beyond 5 years and think about 20 years from now um what do you see the world like in 20 years and where do you see bitcoin's place in it do you see us still having different currencies or will there be as many currencies out there will there be more currencies I think uh it's I always hate questions about the future because I'm really bad at predicting the future I actually have done a little experiment where I try to like make some predictions about what Will happen in the next year and usually I get about half of it right and half of it wrong so don't take your uh picks on the horses then yeah don't don't don't take me to the racetrack I think I would do really badly um you know 20 years from now I think the world will look mostly like it looks today I I think if you think of Bitcoin as being like the internet if you go back 20 years and and see what people were saying about the internet I mean a lot of those things have come true and yet the world today is pretty much like the world was 20 years ago I mean certainly we're all carrying around these wonderful little computers that we can you know talk to anybody in the world I think in 20 years we'll be carrying around these wonderful little computers where you can pay anybody anywhere in the world immediately uh using something like Bitcoin either Bitcoin or or some future kind of worldwide accepted Global Currency whether that will be dollars or Bitcoin or Euros or some currency that hasn't yet been invented I don't know I'm I'm I'm hoping it will be Bitcoin so we're seeing some of the first regulation of Bitcoin or the proposals for regulation um what do you make of proposals out of New York for example or of the FCA in London saying that they're going to explore bit chain B sorry the blockchain technology Regulators have a hard job I mean Regulators have to react to this new technology and try to fit it into into laws that were passed 40 50 100 years ago um and so it it really is a struggle with them and I think you see that in all areas of technology I think since money and banking are probably one of the most heavily regulated kind of sectors it's particularly challenging for Bitcoin getting regulatory Clarity has been really important and I think over the last year year and a half certainly in the in the US and Europe we've seen more regulatory clarity we've seen organizations like the financial crimes enforcement Network finsen in the US come out with guidance on if you were doing these certain things with Bitcoin here are the Hoops you need to jump through here's how we're going to regulate you and I think that's been really incredibly positive for Bitcoin going forward I think the challenge will be to not get overregulation that stifles Innovation right is that going to kill Innovation excessive regulation it could and I think I think certain countries around the world uh take a much stricter approach such as such as China and Russia have been very anti- Bitcoin recently and it might just be part of the regulatory kind of framework that they work in where their first impulse is to ban something and then maybe if they think it's good they'll allow it as opposed to more liberal countries where the first impulse is not to immediately ban something but uh to take a more wait and see attitude and then just correct any problems that arise so what do you think uh the future of mining is going to be do you see there being a concentration of Miners and can you give a just like a one sentence explanation for what a minor is yeah yeah yeah sure so mining is the process of creating new Bitcoin okay perfect and I mean that's the hardest thing for people to understand is that there's no Bitcoin company that controls it it's it's this open- Source software project where people all over the world are doing the work of validating the transactions and in exchange for doing that hard work of making sure that all of the transactions are valid they're awarded with brand new Bitcoins and so that's the only way that Bitcoins are created are through these miners um mining is has has undergone a really rapid Evolution from it used to be you could create Bitcoins just on your desktop computer um those days are long gone now you need specialized chips we're seeing large scale industrial mining uh is it just is is it just going to be concentrated in the hands of a few I think that mining the the the centralization of mining is going to go in waves um right now we're seeing economies of scale for companies that you know create huge numbers of get get these chips and then just create these huge mining farms and places where electricity is inexpensive I think that once those chips become Commodities and they're really inexpensive you'll see it decentralize again and I tweeted just the other day that you know it's getting cold in Massachusetts and I love to see a Bitcoin mining electric blanket because the the kind of the the the the excess the thing that you generate when you're creating Bitcoins is Bitcoins in heat and it would make sense to have an electric blanket that you know use some electricity in a useful way as opposed to just generating heat to generate a few Bitcoins that be like the opposite of burning money it would be the opposite of burning money yes it would be uh creating money and you know but I mean is this is still you think that when the cost of the technology will go down then you'll see the you know more democratization I guess I think we will I mean you know if you look way back at technology you when I was in college way back in the 80s uh we were right at the cusp of going from kind of mainframe computers to personal computers and I actually worked in the uh I worked in the the tech support place and the biggest wave of tech support happened around the time our senior thesis were due because people all over the campus would send their thesis to this centralized laser printer to get it printed out they would go to the computer center and pick it up and that used to be what Computing was like right it was very centralized and then the PC Revolution happened and everybody had a PC and I think a similar thing is going to happen with Bitcoin mining I think these chips will become a commodity I think we'll see them built into products maybe electric blankets maybe that's a stupid idea and that won't happen uh maybe your cell phone when it's recharging will you know generate a couple Bitcoins on the side who knows um but I I think it'll go in waves do you think Bitcoin do you think we're going to have physical cash in the future I don't think I think we'll go past physical cash I think uh you know Ebola people being afraid of Ebola on their you know 10 EUR notes I think might become a real thing right I all it would take would be one story of somebody catching some horrible Disease by handling cash and I think you'll see people kind of rush for the exits to a more hygienic and convenient way of transacting money okay okay but you know on the flip side you have stories like Mount gaau and other spectacular failures aren't aren't that aren't things like that going to make people rush for the exits on bitcoin and are there going to be more of those in the future first I think there will definitely be more of those in the future I do do not expect smooth sailing for the Bitcoin ecosystem um and that's okay with me I mean I live through thec boom and bust and you know pets.com was a spectacular failure uh and yet kind of from from that chaos arose great companies and I think the same thing will happen in the Bitcoin world I mean it's very much a startup culture it's very much an innovation culture so you have to expect lots of innovation but also lots of failures um and I think the thing that remains to be seen is you know who will be the great successes in 5 10 20 years and I just I think we don't know yet so I'm going to get a little bit geeky on you here um can you explain in layman's terms the rest of us uh what side chains is all about why why is that so exciting so people are starting to think about using this global distributed public Ledger which is what Bitcoin is underneath it's a ledger of all these transactions that have happened over time and I think about other things that you could do once you have a global Secure Public Ledger and side change is one of those interesting ideas of what you can do and the notion is that I can take some Bitcoin and I can kind of lock them up in this Global distributed Ledger and then I can move them to some other Ledger for a while that maybe has much faster transaction times or maybe has some other purpose completely and then when I'm done I can kind of move them back and so we're using Bitcoin the the currency as kind of the currency for these other applications that people are excited about building that they can't do on the main Bitcoin blockchain because it's just too experimental I mean at this point you know this is a $5 billion software project when I got involved it was a $30,000 software project um and so we're very conservative about you know the changes we make to the the core Bitcoin code so what can the core Bitcoin code or what can what can the blockchain generally be used for other than trading currencies what do you see out there in the future people are thinking about all sorts of different things everything from kind of maybe Property Transfers so you could imagine if you've ever bought a house you know that there's a title company that assures that the person selling you the house actually owns the house and they'll do title search to make sure that you know and they'll charge you for that and they'll charge you for that and so if you think about it right the title for a house is just the Ledger of who owned the house over time and so you could put those kinds of Records in the global distributed public Ledger that is Bitcoin and there's all sorts of you know legal and maybe regulatory issues there but there are people experimenting with that type of thing for houses or cars or other kinds of property it gets really interesting when you start thinking about this notion of a smart property where an Internet connected thing knows who it's owner is and can kind of connect to the Bitcoin blockchain and know whoever can kind of sign this challenge is my owner so people have thought about you know in the future having self-driving cars that are actually self- owning cars like nobody owns them they just they are and then if you want to use them you make a transaction in the Bitcoin blockchain and then that car knows you know you have the right to use me for this period of time and so those are some of the kind of really interesting wacky way out ideas uh that people are just starting to work on for what what might be next for for This Global secure distributed ledger so what is the key then to getting there um is it regulation or something else regulatory Clarity is important and you know I think a year ago if you had asked me I would say that that is the the most important issue um right now I think the most important issue for Bitcoin businesses is actually interfacing with the the Fiat money with the with the banking systems around the world a lot of Bitcoin businesses have a lot of trouble with getting and maintaining a banking relationship because the banks are really risk averse they just new fangled stuff is not kind of where Banks go they don't really have this Innovation culture that is Bitcoin well they don't want to give bank account counts to pot dealers who are now legal in states in the United States for example that's true too and you know the legal marijuana industry could possibly be you know one of the big Industries for for Bitcoin maybe we'll see tell me more well yeah I know there are people working on that and that this the interesting thing about Bitcoin is is it's permissionless Innovation so everybody is I like to say everybody is doing everything so if there's an idea you think of for some interesting thing you might be able to do with money like me maybe giving uh marijuana growers a way of actually charging their customers that doesn't involve storing huge piles of cash someplace where it can be stolen there is somebody working on that already so I what's the bank's role in this I mean are they going to have to accept it are they going to have to just kind of swallow it or can they can they block it they can block it um at least they can block the the they can make it hard to kind of exchange dollars or Euros for Bitcoins they can certainly make that process harder it's really hard to completely stop it because bitcoin's a peer-to-peer system right if I want to send you some Bitcoin and you want to give me whatever uh a product that you're selling a service you're selling or cash it's there's nobody in the middle to stop that transaction so in the very long term once people are getting paid in Bitcoin and are transacting in Bitcoin I think that it is impossible to stop but this could certainly throw up roadblocks in the short term is there some cool Bitcoin idea you've seen Walking The Halls here there hasn't yet I actually haven't had a chance to Walk The Halls okay um although I hearder I heard there is a very cool company uh I think it's bitx is letting you donate uh Bitcoin to help fight Ebola and so that's I I love to see charity uses of Bitcoins that's probably my favorite well thank you so much for your time it's great talking to you thanks [Applause]