episode 33 - new york, new york!

8/13/2019 Episode 33 - New York, New York!

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Episode 33 Live From New York!

Participants:Adam B. Levine (AL) ost

Andreas . Antonopo"o#s (AA) $o%&ost

'tep&an #rp& (') $o%&ost

onat&an o&an () BitcoinNY$ 'pecia" *#est

(m#sic)

i +o"ks, Adam E. Livine &ere +or Lets-a"kBitcoin. $ontin#in o#r A##sttrend, toda/s episode, is a two%parter. -&e second portion o+ toda/sepisode was recorded in an&attan. -&e da a+ter t&e 0nside Bitcoinsevent wit& 'tep&anie #rp& and specia" #est &ost onat&an o&ano+ Bitcoin NY$. 1e ta"k a2o#t t&e con+erence, t&e attendees, ripp"e,A'0$ minin pane"s, and a"so 2acon. Bi t&anks to onat&an o&anw&o did a reat o2 wit& t&is sement and w&o o#/"" 2e &earin more+rom in t&e weeks to come. B#t +irst, t&ere/s some important news +or#sers o+ Android wa""ets. 1&en news 2reaks in t&e 2itcoin wor"d o+tentimes it/s &ard to #nderstand. -&is week a v#"nera2i"it was revea"edin t&e Android operatin sstem t&at p#t a rea" +ear in t&e 2itcoincomm#nit. L-B ost Andreas Amantonopo"is spoke wit& AndreasPeterson o+ t&e ce"i#m wa""et proect a2o#t e4act" w&at &appened.

B#t 2e+ore we et to t&at, Andreas, 0 &ad some 5#estions +or o#. Firsto++, in t&e interview t&at +o""ows, o# ta"k a "ot a2o#t entrop. $an o#e4p"ain to me w&at t&at is in sort o+ simp"e terms6

AA

'#re, Entrop is a meas#re o+ &ow m#c& in+ormation t&ere is in amessae. 0+ o# "ook at it t&e ot&er wa aro#nd &ow m#c&randomness t&ere is in a messae in comp#ter science terms. 0np&sics terms it/s essentia"" &ow m#c& disorder t&ere is in a sstem or

&ow m#c& ener in t&e +orm o+ &eat t&ere is in a sstem. B#t in t&ecase o+ in+ormation sstems rea"" o# can sa entrop is sain t&esame as randomness. 'o t&e pro2"em we/re disc#ssin in t&ispartic#"ar 2# is t&at somet&in t&at s&o#"d 2e random % t&at means its&o#"d &ave &i& entrop % is not random. 0t doesn/t &ave t&enecessar entrop. 0n +act, it/s a rat&er predicta2"e se5#ence.


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AL

'o w&en we ta"k a2o#t randomness t&at can a"so 2e c&aracteri7ed asnoise compared to t&e sina", ri&t6

AA

1e"", e++ective" es. 0+ o# &ave a random stream, especia"" i+ it/s asec#re random n#m2er enerator w&ere o# e4pect it to &ave certainc&aracteristics o+ randomness t&en t&ere s&o#"d 2e no sina" % t&at/st&e de+inition. 'o ever 2it t&at comes o#t o+ t&at s&o#"d 2e noise %o# s&o#"d &ave no sina".

AL

'o it/s a"" noise t&en. 8k, so i+ it/s a"" noise, t&en is t&ere a di++erence2etween a "ot o+ noise in a sstem vers#s a "itt"e noise in a sstem6#st not necessari" ta"kin a2o#t random n#m2er enerators #st2road" speakin. 0+ o#/re trin to encrpt somet&in or sec#resomet&in, is it 2etter to &ave more randomness t&an "essrandomness6

AA

Yo# need a2so"#te randomness. Let me ive o# an e4amp"e. Let/ssa t&at t&ere/s a +#nction wit&in t&e sstem w&ere o#/re takin arandom n#m2er and o#/re m#"tip"in it wit& o#r secret ke. 'o +orsimp"icit sake, "et/s sa 0 &ave a secret ke and m secret ke is 3. 'oive me a random n#m2er 2etween 9 and ;.

AL

3

AA

Fantastic, so, 0/m oin to m#"tip" t&at 2 3 and 0/ve ot m diita"sinat#re. 'o i+ 0 ask o# in m ne4t transaction, ive me a n#m2er2etween 9 and ;.


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in e4istence in order to crack t&is one partic#"ar =? derees o+randomness 2asica""%

AA

%Yo# co#"d do on a wide 2oard wit& a pen.

AL

i&t oka, we"" t&at makes a "ot o+ sense. 8k reat. 1e"" 0 rea""appreciate o# providin some c"arit +or #s on t&is iss#e. Let/s #mpri&t into t&e interview wit& t&e ot&er Andreas.

i everone, t&is &as 2een a rat&er e4citin week in t&e 2itcoin spacewit& t&e anno#ncement o+ a ver critica" android 2# t&at &aswidespread reperc#ssions a"" across t&e mo2i"e wa""et space. -odisc#ss t&is in a 2it more detai" 0/m ver p"eased to 2e oined toda 2Andreas Peterson w&o is one o+ t&e ownersa#t&ors o+ t&e ce"i#mo2i"e 1a""et and &e/s &ere to ta"k to #s a 2it a2o#t t&is recent 2reac&.

AP

e""o everone.

AL

e""o Andreas, t&ank o# so m#c& +or oinin #s. $an o# te"" me a 2ita2o#t w&at e4act" t&e pro2"em is % w&ere did t&is start6

AP

-o see t&e so#rce o+ t&e pro2"em we &ave to o 2ack in time a "itt"e 2itto =;9= w&en t&ere was an anno#ncement o+ a randomness +ai"#re int&e Android imp"ementation o+ ava. Basica"" in t&e &armon sstem.-&is was presented in t&e 'A con+erence in =;93 % 0 t&ink it wasarc&. -&is was main" an academic pro2"em. Beca#se no2od co#"drea"" see t&e practica" pro2"em 2e&ind it e4cept +or t&is weirdrandomness 2e&avior on Android.


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AL

Yea&, so it wo#"d on" rea"" app" i+ o# &ad some kind o+ 2i7arrediita" c#rrenc t&at co#"d some&ow 2e sto"en, ri&t6

AP

Yes, ea&, so most peop"e don/t rea"" notice i+ "et/s sa t&eir ''Lconnections aren/t rea"" t&at sec#re or i+ t&e enco#nter some ot&erkind o+ pro2"em. 'o, 2itcoin rea"" p#ts t&e sstem #nder test &ere andrevea"s t&ese kinds o+ pro2"ems. -o 2e precise 0 t&ink t&is is not asin"e pro2"em % t&ere are two ver distinct pro2"ems t&at we &aveseen &ere. -&e +irst pro2"em is o# know t&ere/s a so ca""ed randomdevice in most Lin#4 sstems or in a"" Lin#4 sstems, and +rom t&att&ere is a C%andom device. -&ese seem to 2e workin +ine as +ar aswe know.

AL

'o t&e operatin sstem random device enerator t&at creates randomn#m2ers t&at/s workin ok on Android.

AP

Yea&, ea& % so to act#a"" #se random n#m2ers on Android #sin ava"an#ae o# need to instantiate a so%ca""ed sec#re random o2ect andt&at sec#re random o2ect is #st a wrapper +or a sstem "i2rar andt&at is common" imp"emented #sin 8pen'L. And t&at imp"ementst&e randomness 2 ta"kin to t&e device and so t&ere are man "aersinvo"ved &ere. 1a""et A"p&as did not&in wron. -&e st#ck to t&edoc#mentation and app"ied t&e 2est practices to not rewrite o#rcrptorap& and so on. 'o t&at was not t&e pro2"em. -&e pro2"emwas 2etween a"" t&ese "aers, entrop was removed +rom t&e oriina"

entrop so#rce t&at is t&e random device.

AL

'o 2asica"" o#/re ettin n#m2ers t&at are "ess random t&an t&es&o#"d 2e +rom t&e so#rce so rad#a"" t&e/re ettin "ess and "essrandom, ok.


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AP

Yea&, 2#t +rom t&at 2# direct" no2od rea"" "ost mone. 0 &aveta"ked to anot&er # w&o is crackin private kes as a &o22, and &e

enerated "ots and "ots o+ random n#m2ers. =.? mi""ion randomn#m2ers and &e never ot t&e co""ision #sin Android. e never ott&e co""ision so t&ere was no private ke compromised as +ar as weknow. 1e don/t know rea"", 2#t w&at we do know is t&at t&ere is asecond iss#e. -&at is, w&en sinin transactions t&ere is a"so arandom n#m2er needed to enerate a va"id sinat#re. And t&osesinat#res are de+inite" not as random as we t&ink t&e are.

AL

'o "et me #st c"ari+ t&ere Andreas +or a second. 'o t&e iss#e is notwit& t&e ke eneration per se, t&e iss#e is t&at w&en o# tr to sin atransaction especia"" to spend it, o# are in a sit#ation w&ere o# areseedin t&at sinat#re wit& a random n#m2er w&ic& is not random andi+ o# do t&at more t&an twice, t&at can revea" t&e private ke. 0s t&atcorrect6

AP

Yes, e4act". 'o t&ere is an e5#ation, it is descri2ed ver nice" in a2itcoin maa7ine artic"e. 0+ o# &ave t&is random n#m2er and o# #seit twice, t&en #sin t&is e5#ation o# can trivia"", simp", ca"c#"ate t&eprivate ke t&at was #sed. -&is means t&at i+ o# &ave a weak randomn#m2er enerator t&at can potentia"" e4pose o#r private ke toeverone. -&at &as &appened a n#m2er o+ times in t&e past. ost o+t&e time w&ere it was w&en peop"e were p"ain aro#nd wit& toimp"ementations, prototpe imp"ementations o+ c"ients. B#t it a"so&appened on Android direct" w&en sinin transactions. -&e iss#e ist&at o# create a new sec#re random instance and t&en o# 5#er ittwice. Cnder ver weird circ#mstances t&ere are +a""2ack scenarios

w&ere t&e entrop oes down to a "eve" w&ere it &as a ver &i&c&ance o+ repeatin t&e same va"#e. Basica"" 0 t&ink t&at in somecases t&e randomness can o down to @ 2its o+ entrop instead o+ =?2its o+ entrop.

AL


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*iven a"" o+ t&ose circ#mstances 0 wo#"d ass#me t&at means w&et&ero#/ve enerated t&e ke on an Android wa""et or not, i+ o# &ave anAndroid wa""et t&at is #sin t&is ava sec#re random n#m2er enerator,and o# #se t&at to spend mone at an time o# &ave a c&ance o+&avin revea"ed a private ke +or t&at partic#"ar wa""et6

AP

i&t now 0 wo#"d ass#me % o+ co#rse o# s&o#"d mirate o#r kes2eca#se o+ t&e enera" entrop iss#es % 2#t, ri&t now, i+ o# &aven/t"ost o#r mone et, it/s not e4treme" "ike" t&at o# wi"" "ose it in t&e+#t#re 2eca#se o+ t&is second v#"nera2i"it. Beca#se t&at wo#"d meani+ o# contin#e #sin t&e o"d so+tware and enerate t&ese weaktransactions es, t&en o# co#"d potentia"" e4pose t&at. B#t t&at/sver #n"ike".

AL

'o one t&in t&at was rat&er interestin wit& t&is was t&at t&e 2#itse"+ e4presses itse"+ on t&e 2"ock c&ain in a wa t&at anone can oand +ind t&ese s#spect transactions. Pres#ma2" o#/re "ookin at atransaction, or rat&er o#/re "ookin at two consec#tive transactionsdone 2 a same ke w&ere t&e same random parameter was #sed +or2ot&, and pres#ma2" o# can #st write so+tware t&at track"esst&ro#& t&e 2"ock c&ain to +ind t&ese, ri&t6

AP

Yea&, and peop"e were doin t&is and o# wi"" "ose o#r mone rat&er5#ick" i+ o# enerate s#c& a transaction.

AL

0+ o#/d a"read done it o# wo#"d &ave "ost o#r mone a"read sot&ere/s not&in to worr a2o#t. #st don/t make an new transactions.

AP

Yea&, and o+ co#rse a"" t&e c&ane o+ kes. -&ere are man propertieso+ t&is stack, ''L, and t&e Android AP0 t&at are kind o+ s&ad in m


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as 0 know a"" pop#"ar Android wa""ets &ave 2een #pdated so t&at t&eare +o#r wa""ets o#t t&ere t&at keep o#r own private kes on t&edevice. -&at/s 2itcoin wa""et +rom (ina#di2"e 9:3;), t&at/s ce"i#mwa""et, B"ockc&ain.in+o, and a"so t&e now kind o+ deprecated Bitcoin'pinner % t&at was t&e previo#s app"ication +rom an % was a"so

#pdated. 'o on some o+ t&ese wa""ets o# need to man#a"" do t&e kerotation, 2#t on ot&ers +or e4amp"e on t&e ce"i#m wa""et t&ere/s awi7ard t&at detects o"d kes and a#tomatica"" moves t&em to newkes. And in t&e process w&at 0 rea"" want to emp&asi7e &ere, p"easedo make a 2ack#p o+ a"" o#r o"d kes and o#r new kes. Yo# don/tknow i+ o#/re oin to need t&em in t&e +#t#re. 0n t&e wi7ard it a"soives o# t&e opport#nit to make a 2ack#p. 'o p"ease do t&at andet t&ose private kes onto a piece o+ paper p"ease.

AL

8ka, es, ver ood advice. *et it onto paper wa""ets as 2ack#ps. 'o"et me #st c"ari+ a tin 2it. Yo# ta"ked a2o#t t&e rotatin kes, i+ o#were to 2reak down t&is process: o# down"oad t&e new code +rom t&eso+tware deve"opers w&o &ave #pdated t&e code. Yo# make a 2ack#po+ t&e kes as o# ver ri&t" #st said. -&en o# create a new wa""et,and t&en o# essentia"" send a"" t&e mone +rom t&e o"d wa""et to t&enew wa""et6 0s t&at it prett m#c&6

AP

Yo# wi"" send mone +rom one address to anot&er address and o#rwa""et so+tware now &as ma2e 2ot& addresses in it or #st one addressin it dependin on t&e imp"ementation #sed. 0t/s not a ver comp"e4pro2"em, o#/re essentia"" #st sendin mone to o#rse"+ and it/s anew address.

AL

And ver critica"" 0 wo#"d sa t&is &as to &appen a+ter t&e so+tware &as2een +i4ed 2eca#se i+ o# #st enerate a new address and tried tosend o#r mone, o# wi"" 2e creatin e4act" t&e kinds o+ transactionst&at co#"d compromise o#r private ke, ri&t6

AP


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Yea&, so #pdates +or a"" t&e wa""ets &ave 2een p#s&ed o#t so t&e p"astore and t&e two ot&er c&anne"s, t&at s&o#"dn/t 2e a pro2"em. $an 0ask o# somet&in in ret#rn reardin t&is topic. Yo# were invo"ved int&e paper wa""et proect, ea&6 ow is t&e sit#ation t&ere, do o# &avean inside in+ormation a2o#t... w&at kind o+ randomness does t&e

paper wa""et provide6

AL

-&e oriina" paper wa""et is derived +rom t&e 2itaddress.or version =..-&at/s t&e same so+tware we #se +or open paper wa""ets, sa+e paperwa""ets, and as +ar as 0 know t&e 2itcoin paper wa""ets w&ic& is anot&erversion. A"" o+ t&ose #se t&e operatin sstem dev#random +romwit&in a ava'cript wrapper "i2rar. -&at does not r#n on Android sot&at wo#"d 2e inside t&e desktop 2rowser as +ar as 0 know t&ere/s no

v#"nera2i"ities t&ere.

AP

0t wo#"d re" on t&e ava'cript imp"ementation o+ t&e 2rowser #sed. 'oit co#"d 2e $&rome or 0nternet E4p"orer or somet&in.

AL

1e"" it/s cross%2rowser so it operates on a"" o+ t&em, 2#t certain" es,one o+ t&e considerations &ere % and 0 t&ink a ood sec#rit practice %and one o+ t&e reasons 0 was not as worried a2o#t t&is even t&o#& 0#se a mo2i"e wa""et is simp" t&at 0 on" &ad =%3 o+ m +#nds on"ineon t&e wa""ets t&at were doin transactions +rom m mo2i"e c"ient. -&erest was a"" in paper wa""ets and t&at/s a ood wa to 2e rest%ass#redessentia"" % to 2e re"a4ed a2o#t it.

AP

Yea&, ea&, a2so"#te". 'o a"so 0 mean on paper wa""et o# re" on&avin a ood entrop +or t&e ke o+ co#rse 2#t t&e main pro2"em t&ed#p"icated random va"#es in t&e transaction doesn/t even s&ow #p inpaper wa""ets 2eca#se t&e don/t do an transactions o+ co#rse.

AL


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-&at is correct a"t&o#& we do &ave in o#r "atest version o+ 'a+e Paper1a""ets so+tware we do &ave a wa to comp"ete" sweep and redeemand it wi"" create a transaction so 0 wo#"d &ave to "ook at t&e randomn#m2er enerator. B#t in enera" 0 t&ink t&is is rea"" a sin o+ t&insto come 2eca#se v#"nera2i"ities in t&e past &ad time 2etween oin

+rom t&eoretica" to practica" and in t&e wi"d, 2#t w&at 2itcoin does is itprovides immediate incentive to take t&at t&eoretica" e4p"oit practica"and make some mone o++ o+ it. 'o we/re oin to see t&is &appenmore and more, wo#"d o# sa6

AP

A2so"#te". 'o t&is is rea"" s&owin t&e weaknesses on some sstemsand a"so in comp#ter sec#rit it/s not s#rprisin t&at a "ot o+ +i"e &osts,server &osts, &ave 2een &acked and attackers speci+ica"" on" went +or

t&e 2itcoin c#stomers and "e+t everone e"se a"one. 'o t&is rea""s&ows t&e sec#rit stat#s o+ t&e sstem i+ o# &ave some 2itcoins #p+or ra2s +or an attacker.

AL

ost sstems are not 5#ite read et +or storin diita" mone 2#twe/re oin to "earn and deve"op as time oes 2. 0 wo#"d "ike to t&anko# so m#c& Andreas Peterson, co%a#t&or o+ t&e ce"i#m mo2i"ewa""et +or ivin #s some e4ce""ent in+ormation toda on w&at e4act"

is &appenin wit& Android random n#m2er enerator, &ow to so"ve it,so w&at to acco#nt +or, and t&ank o# so m#c& +or a"" t&is #se+#"in+ormation.

AP

Yo#/re we"come.

Eas DN' is t&e 'wiss%arm kni+e +or o#r domain names % &e"pinmeet t&eir c#stomer/s individ#a" needs since 9@@>. Eas DN' &as2een an o#tspoken critic o+ '8PA and $0'PA. Eas DN' was an ear"s#pporter o+ 2itcoin and now t&e are pro#d to sponsor t&is s&ow. Do2#siness wit& a 2#siness t&at s&ares o#r va"#es. *et a 93 disco#ntw&en o# pa wit& 2itcoin. *o to 2itcoin.easdns.com and 2e s#re to#se disco#nt code L-B.


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i, t&is is ason Gin, +or Bitcoin9;;.or, and o#/re "istenin toLets-a"kBitcoin. Bitcoin9;; is o"d sc&oo" 2itcoin p&i"ant&rop. 1e/ve2ro#&t +#rt&er awareness to 2itcoin 2 &avin c&arities and non%pro+its add a 2itcoin donation option to t&eir sites. -&en we wi"" awardt&em wit& a H9,;;; endowment +or t&eir e++orts. P"ease &e"p s#pport#s 2 eit&er donatin to o#r ca#se at Bitcoin9;;.or or 2 &e"pin #s+ind wort& non%pro+its t&at are wi""in to accept 2itcoins +or donations.-&anks.

AL

i and we"come to episode 3; o+ Lets-a"kBitcoin, we are on t&e 3>t&+"oor o+ t&e New Yorker ote" in New York, New York! Yesterda weattended t&e 0nside Bitcoins $on+erence, and t&is mornin it/s a "itt"ea+ter 9; A East $oast time w&ic& means a2o#t < A 1est $oast time.-&e time t&at m 2rain is sti"" on. oinin #s toda we/ve ot mnorma" co%&ost 'tep&anie #rp&.

'

e""o, we/re in t&e same room aain!

AL

Yes, we/re in t&e same room aain. 'econd time! 'weet. And t&ena"so specia" #est &ost r. onat&an o&an.

e, 0 &ave some 2i s&oes to +i"" 2#t 0 &ope to t&em 5#ite ((ina#di2"e,

=9:;;)

AL

'o on o&an aain &as 2een on t&e s&ow 2e+ore and is t&e +o#nderand w&ir"wind o+ activit t&at constit#tes t&e p"annin 2e&ind t&eBitcoin NY$ ro#p and vario#s events. 1e went to a cocktai" part t&e


13/101

ni&t 2e+ore "ast6

Yes, on onda.

AL

'econd market t&at o# &e"ped p#t toet&er and it was a com2inationro#p event +or Lets-a"kBitcoin and +or a co#p"e o+ ot&er % 0 t&ink$oinsetter was t&ere6

'

Yea&.

AL

Yea&, $oinsetter, and t&en t&e ot&er one was o+ co#rse 'econd arket.

Yea&, 0 &eard t&at 9; peop"e 'IP/d, t&e &ad to kick peop"e o#t.

AL

Yea&, t&at was a +#nn t&in. Apo"oies to "isteners i+ an2od didn/tet in, +ee" +ree to emai" comp"aints to Adam at Lets-a"kBitcoin.com.B#t ea&, so t&is was an incredi2"e event! 0 otta sa even +or a oneda event, a "ot o+ st#++ &appens, o# know t&e ta"ks aain, we &ad t&ist&in w&ere t&e ta"ks were ood 2#t it was more a2o#t t&e attendees

t&an rea"" a2o#t t&e speakers.

'ome +eed2ack 0 ot was t&ere were wa more ama7in peop"e in t&ea#dience t&an sometimes as a pane"ist 0/m onna sa%


14/101

AL

i&t, we a"" spoke t&ere 0 +ee" com+orta2"e sain% (a"" "a#&)

0 wo#"d ta"k "ike, J1&at do o# do6 1& weren/t o# on t&at6 8& mod!J

'

0t/s tr#e. Yo#/d wa"k aro#nd and everone &as $E8 on t&eir name ta.0 wanted to sa 0/m "ike t&e $E8 o+ 8rk -&erap or somet&in. (a"""a#&) B#t ea& 0 mean ever2od &ad a proect, t&e a"" &ad t&ins tosa. At one point 0 was doin some interviews o#t in t&e &a""wa and 0rea"i7ed t&at severa" &o#rs &ad one 2 and 0 &ad missed Adam/s ta"kact#a"" and 0 wanted to see it 2#t 0 was "ike #st one interview a+ter t&eot&er, so...

AL

Yea& ea&, no, o# were 5#ite t&e mac&ine o#t t&ere,. 'o &ow man

interviews did o# et t&is time, 'tep&anie6

'

8&, at "east a do7en.

AL

8ka, so o# ot, 0 t&ink it was, was it =; "ast time6 0 t&ink it was

a2o#t = "ast time6 8ka, so t&e ratio is a2o#t keepin #p, it/s a2o#t9=%9 a da.

'

1e"" &ope+#"" it/s 5#a"it too and not #st 5#antit. B#t &onest" 0t&o#&t t&e were reat. 0 ta"ked to some peop"e t&at 0 &ad 2een


15/101

wantin to ta"k to and it was rea"" interestin. Especia"" to &ear morea2o#t w&at/s oin on in t&e minin scene. -&ose were pro2a2" m+avorite interviews. 0 ta"ked to 'am +rom GN$ iner and os& +romB#tter+" La2s. 0 a"so +o#nd o#t a2o#t Feat&ercoin, t&at was interestintoo.

AL

Yea&, ea&, did o# meet t&e $08 t&ere6

'

Yes, t&at was Peter.

AL

1as t&at &is name6 0 t&o#&t &is name was o&n. 0/m terri2"e wit&names.

'

0t was Peter o&n.

AL

Peter o&n! -&ere o# o, oka, t&at makes sense.

mot&er sas to never tr#st peop"e wit& two +irst names. a2et&at/s a sin. 0 &ad no idea &e was t&ere.

'

Yea& it was coo", 0 "earned some t&ins 0 didn/t know a2o#t Feat&ercoin2e+ore and 0 kind o+ wanted to et Feat&ercoins "ast ni&t w&en 0 ot&ome.


16/101

0 oke wit& onat&an 1or&an t&e Bitessae # t&at we s&o#"d makeo#r own crpto c#rrenc and ca"" it 2reat& "ike air. And w&at it wi"" do is

t&ere wi"" on" ever 2e =9 5#adri""ion #nits in circ#"ation and it wi"" 2et&e &eir to Feat&ercoin/s copper. (a"" "a#&) 0t/s so (ina#di2"e =:;;)it/s #nmetera2"e. 0t/s #st o# don/t care 2eca#se it/s so man. 0 t&inkit/s onna o p"aces, 0 t&ink t&is is t&e time to anno#nce it.

'

-&ere is so m#c& more oin on too. -&ere were a "ot o+ 2i mediat&ere. Adam, o# know, 0 don/t know i+ t&e/re oin to do ant&inwit& it 2#t o# and 0 were 2ot& on camera +or $B' nationa".

AL

Yea&, no, s&e was e4cited, we spoke wit& t&e prod#cer t&ere, 0 act#a""% wa"kin o#t on t&e ta"ks on t&e wa to "#nc&, o# know 0 act#a""didn/t eat 2reak+ast esterda and so 0 was &eadin to "#nc&. B#t t&en0 was wa"kin 2 and 0 saw t&is 2ewi"dered "ookin woman w&o &ad anameta t&at said prod#cer $B' and 0 "ike reversed, came 2ack, andwas "ike, Je, 0/m Adam B. Levine o+ Lets-a"kBitcoin! Do o# need an

&e"p +indin anone6J 'o t&at/s w&at 0 tr to do at t&ese events mosto+ a"" is #st to 2e &e"p+#" and to%

'

8& o# were reat wit& t&at! Yo# "ined #p a 2#nc& o+ interviews. 0t&ink s&e "earned a "ot a2o#t 2itcoins 2eca#se s&e was tota"" new to itand 0/m "ad t&e decided to come. $NN was t&ere in t&e mornin.

AL

1e"" t&e weren/t necessari"% $B' wasn/t% s&e was #st t&ere to see i+t&e s&o#"d cover it. And so a+ter 0 to"d &er t&at 0 co#"d et &er "ike 9;interviews s&e/s "ike 8k, 0/m ca""in t&e crew. -&en t&e s&owed #pa2o#t a &a"+ &o#r "ater. B#t no, it was reat, it/s terri+ic. Aain, 2itcoinand crpto c#rrencies in enera" are &ard to #nderstand i+ o# don/t&ave t&e 2asis to #nderstand t&em and so w&en especia"" o#rna"ists


17/101

come into p"a % a "ot o+ times t&ese peop"e don/t &ave a rea" monetar2ackro#nd and so it/s &ard to appreciate it. B#t o# know, i+ o# canet o#t t&ere and ive t&em ood ana"oies t&e can #nderstand andt&e can take 2ack to t&eir "isteners and t&eir viewers % 2eca#se t&ato+ co#rse is t&e ot&er t&in is t&at i+ t&e can/t #nderstand it &ow in

&e"" are t&e s#pposed to present it to an a#dience w&o is even "essin+ormed t&an t&e are. 'o, o# know, 0 t&ink we act#a"" did someood work esterda and 0 know PB' was t&ere too.

'

e#ters, -ec&$r#nc&. A "ot o+ 2i names, &onest". 0t was reat.

Yo# know, at De+$on, t&e &ave somet&in ca""ed spot t&e +ed w&ereit/s a ame w&ere o# &ave to spot w&o/s a +edera" aent. And act#a""0 don/t know in t&e 'an ose con+erence i+ o# &ad an, 2#t, did o#

'

Andreas c"aimed t&at &e identi+ied an FB0 aent.

1ere o# a2"e to meet t&e specia" aent w&o was &ere +rom t&e $2er$rimes Division6

'

0 didn/t meet &im 2#t 0 &eard o#/re &avin "#nc& wit& &im.

Yea&, ne4t week 0 want to do t&at. e seems rea"" interestin.

'


18/101

1ow, so o# didn/t &ave to spot &im &e was o2vio#s.

Yea&, &e was wearin a name ta t&at read FB0. e didn/t "ook "ike aFed. e was wearin a t%s&irt and #st &anin o#t.

'

1e"" t&en t&e 5#estion 2ecomes w&o was inconito.

i&t, ri&t. 0 &ad a rea"" +#n moment w&ere someone &ad iven me&is card. And 0 went, o& m od 0 ta"ked to t&is Fed o# &ave to ta"k to&im. 'o w&en 0 went to speak to &im, 0 said &e 0/m onat&an wes&o#"d ra2 "#nc& some time. And &e said, J8&, "et me ive o# mcard.J And 0 was "ike, Jt&at/s a"ri&t 0 a"read &ave a"" o+ o#rin+ormation.J ("a#&s) And &e was "ike, J1&at6J

AL

A&ead o+ t&e ame! ("a#&s)

Yea& no, in addition to t&e FB0 % 0 did not meet t&e aent t&ere, 2#t. 0did see someone +rom treas#r t&ere and 0 ot a card +rom t&em andwe/re onna speak to t&em 2eca#se aain o# know t&e/re... ea""w&at it seemed "ike aain % and t&is mi&t not 2e tr#e o+ everone int&ese aencies 2#t certain" t&e peop"e w&o are t&ere at t&e ver "eastseemed "ike t&e were c#rio#s and #st didn/t rea"" know w&at wasoin on. 'o t&at co#"d 2e an act%

'-&at wo#"d not s#rprise me..

AL

i&t, e4act" 2#t it seems act#a"" +air" "ike" t&at iven a"" t&e t&ins


19/101

to pa attention to, t&is is #st simp" not somet&in t&at t&e maorito+ t&em are pain attention to.

i&t. And o#/d mentioned PB'. 'o 0 was speakin wit& t&em and att&e end o+ t&e interview t&e prod#cer &ad mentioned, JYo# know, wewere ta"kin a2o#t potentia"" t&inkin a2o#t acceptin 2itcoin.J And 0said, J8& m od, t&at/s ama7in! 8&, wait! 0/m onna do as m#c& as0 possi2" can to make t&is a rea"it...J And t&at/s w&at/s so ama7ina2o#t t&e con+erence is w&en o# &ave 3;;, ;; entreprene#rs in aroom it/s rea"" eas to start doin t&ins. 'o 0 #st ot% 0 immediate"ran to -on *i"eppe o+ BitPa. And so 0 was "ike, JA"ri&t o# and 0.1e/re onna meet wit& PB' and we/re onna make t&is &appen.J And 0ot o#t t&ree s&eets o+ paper, and 0 #st ran aro#nd t&e con+erence and

d#rin t&at time we act#a"" ot =;; 2itcoins p"eded towards oin tPB' s&o#"d t&e accept 2itcoin. 'o act#a"" os& +rom B#tter+" La2sp"eded ;. And t&en EFC p"eded ;. And 'am +rom GN$ iner6Yea&, &e p"eded ; as we"". and t&en -rade&i"" p"eded 9;. And t&enwe &ave Bitcoin9;;, w&ic& is a"was avai"a2"e +or 9; 2itcoin. And t&ena2o#t =; peop"e a"so pitc&ed in a2o#t 9 2itcoin. 'o it was kind o+ acomm#na" e++ort. #st a s&ock 2 &ow m#c& demand t&ere is to seesomeone "ike PB' et 2e&ind 2itcoin.

AL

-&at act#a"" e4ceeds t&e n#m2er o# oin +or, ri&t6 Beca#se at t&eend o+ t&e con+erence we ended a "itt"e 2it ear" 2eca#se one o+ t&espeakers didn/t s&ow #p. $&ristian D#mont 0 2e"ieve....

'

8&... +rom Food"er!

AL

Yea&

'


20/101

Yo# wanted to ta"k to &im.

AL

0 know! 1e/ve 2een trin to sc&ed#"e wit& &im. Beca#se aain t&e&ave a rea"" interestin #se case and t&at/s w&at &e was s#pposed to2e speakin a2o#t t&ere 2#t as +ar as 0 #nderstand it so#nds "ike &emissed two +"i&ts 2 comin &ere and did not make it in.

'

Yea&, 0 can #nderstand t&at it/s eas to et "ost in New York and it/seas to...

AL

0t/s eas to not et to New York too apparent".

'

Yea&, tota"". 1e"" &ope+#"" we/"" 2e a2"e to catc& #p wit& &im "ater.

AL

Yo# know, aain, it seems "ike t&e/re &avin a "ot o+ s#ccess wit& t&espace so t&ere/s no incentive +or t&em to "eave.

'

0 #st saw somet&in sain t&at t&eir 2itcoin orders. 'o it/s a t&inw&ere o# can order take%o#t. And t&e take o#t 2itcoin. 'o o# can

take o#t "oca"" wit& 2itcoin and 0 #st saw an artic"e a2o#t it andapparent" t&e 2itcoin orders &ave rown and trip"ed over t&e "astmont& or somet&in.

AL

'o o+ co#rse t&e 5#estion wit& t&at a"was is w&at were t&e to 2ein


21/101

wit&6 Beca#se trip"in...

'

Yea&, we &ad 9 2itcoin order "ast mont&, now we &ave 3. ("a#&ter)

AL

'o it/s a"" kind o+ re"ative w&en o#/re ta"kin/ a2o#t a2stract n#m2ers"ike t&at. 'o, "et/s ta"k a2o#t t&e con+erence. 0 mean t&at was certain"somet&in is t&at we did see a "ot o+ A'0$s t&ere. 0 don/t t&ink an2odspoke a2o#t A'0$s. -&is was not rea"" a tec&nica" event, t&is wasmore on t&e re#"ator side o+ t&ins.

'

Yea&, or #st #m, "ike an intro, "ike. -&e rea"" did tr to make it+riend" to peop"e w&o &ad no idea w&at 2itcoin was. -&e kenotespeaker was $&ar"ie '&rem so &e spoke +irst t&in in t&e mornin andact#a"" 0 was seated ri&t in +ront o+ &is parents and so t&at was coo"2eca#se 0 ot to meet &is parents. e was sain t&at &e +o#ndedBit0nsant , #st a o#n #. e/s on" =3 ears o"d. #st ama7in w&at&e/s done wit& Bit0nstant in t&at time. B#t &e was sain &e ot"a#&ed o#t o+ ever vent#re capita" +irm t&at &e tried to pitc& t&e idea

to 2ack severa" ears ao. 3 ears ao 0 t&ink. 1&en &e was trin tostart Bit0nstant. 'o, &e &ad to act#a"" et t&e start#p +#ndin +rom &isom. And so s&e was standin #p and s&e was "ike woo&oo!

AL

-&e n#m2er t&o#& % t&at was t&e t&in t&at s#rprised me. 0 ass#medt&at t&ere was more cost 2e&ind Bit0nstant 2#t &e said t&at

'

9;,;;; do""ars.

AL


22/101

ea&, H9;,;;; to start Bit0nstant.

'

Yea&. 0/m s#re &e didn/t &ave an o++ice in an&attan at +irst.

AL

0 mean o2vio#s", 2#t it #st oes to s&ow t&e 2arrier to entr on t&eseproperties even so even wit& somet&in "ike t&at w&ere o#/re act#a""inter+acin wit& t&e monetar side o+ it is not t&at e4pensive #nti" o#et to re#"ator comp"iance. And once o# et to re#"atorcomp"iance t&e cost oes t&ro#& t&e roo+ and o# s#dden" needmi""ions o+ do""ars in order to pa t&e 2onds, #st end"ess t&ins.

'

0 t&ink t&at/s rea"" important to point o#t 2eca#se it/s rea""... a"readwe don/t rea"" &ave re#"ation% is m#c& a2o#t 2itcoin 2#t #st t&et&o#&t t&at t&ere co#"d 2e re#"ations a2o#t 2itcoin is sti+"in a "ot o+2itcoin 2#siness. And we saw on t&e% t&ere was a vent#re capita"istpane" act#a"" o+ severa" investors w&o were eit&er &ad invested in2itcoin 2#sinesses or &ad invested in 2itcoin persona"" or werep"annin on it. And one o+ t&e t&ins t&e said t&at t&e wo#"d avoid

t&at was "ike a red +"a +or 2itcoin 2#sinesses t&at t&e wo#"d not wantto +#nd a 2#siness was i+ t&e &ad 2asica"" "ike re#"ations &aninover t&eir &ead or "ike re#"ator "ia2i"ities. 'o 2asica"" e4c&anesand t&ins t&at co#"d 2e potentia"" considered mone services2#sinesses or ant&in "ike t&at.

And so at one o+ m week" entreprene#rs&ip meetins re#"ation ist&e ta"k o+ t&e town. Beca#se t&ere is t&is tremendo#s incentive +or(ina#di2"e 39:>) to not want to invest in somet&in +or w&ic& o#can/t 5#anti+ t&e risk +or. And i+ o# don/t &ave o#r re#"ation downo#/re #st a risk 2et.

'


23/101

Yea& it doesn/t matter &ow reat o#r 2#siness is and t&at #st str#ckme as so #n+air. Yo# co#"d &ave an ama7in idea +or a 2#siness andt&ese 2#rea#crats are #st onna et in o#r wa . And o# won/t 2ea2"e to et +#ndin.

AL

an on a second. 0t/s not +air, 'tep&anie. 0t/s not +air6 No, o+ co#rseit/s not +air. 0t/s not s#pposed to 2e +air.

And o# know, t&ere/s reason w& +inance &asn/t c&aned t&at m#c& inAmerica. And it/s 2eca#se o+ w&at/s &appenin &ere.

'

Yea&, wit& t&e re#"ations. E4act". Ever2od sas t&e C' is t&e "east+riend" environment +or an 2#siness t&at invo"ves mone.

And 0 act#a"" t&ink t&at 2itcoin mi&t 2e t&e canar in t&e mind to sat&at, J-&is mi&t 2e t&e point w&ere proress and innovation needs to"eave America in order to s#cceed.J Beca#se 0/ve 2een &avin weeksand weeks o+ disc#ssions wit& re#"ators and 0 mse"+ was scared awa+rom startin a compan #st 2eca#se 0 wo#"d 2e a mone transmitterand wo#"d need ndreds o+ t&o#sands o+ do""ars to start m ideaw&en rea"" t&e costs were #nder 9; rand to et it started.

'

1e"" &ow man peop"e &ave t&e same e4perience.

And so man 0/m ta"kin to t&em and t&e answer is a"was, J1e"" o#know Eric and *a2e and t&e 2#nc&, down in Panama, tota"", t&e/""&ook o# #p. -&e/"" ive o# a p"ace to cras& +or a 2it #nti" o# +ind


24/101

somew&ere and Panama is ri&t t&ere, ; income ta4, we co#"d do it#s.J

'

And o# know a2o#t $oinap#"t.

Yes $oinap#"t.

'

-&at/s t&e compan Eric Ior&ees... Yea& t&at rea"" stood o#t to me, 0mean #st t&e +oc#s on w&ere is t&is onna o +rom a re#"atorstandpoint and 0 +ee" rea"" sad a2o#t t&at. 0 "ove to see t&ese2#sinesses rowin. And we &ave s#c& an ama7in tec&no"o t&atco#"d do so m#c& +or +reedom in t&e wor"d, +or convenience. 0t #stopens #p so man possi2i"ities it rea"" is t&e +#t#re o+ mone +or areason 2eca#se it/s so m#c& 2etter t&an w&at we/ve ot ri&t now.$redit cards were reat, t&e were an innovation 2#t t&at was ; or 3;ears ao, ri&t6 At t&is point6 And so, o# know, it/s time +orsomet&in new and 0 wo#"d "ike it to 2e a2"e to #st o and see w&at&appens wit& it. B#t it seems "ike t&ere/s a storm c"o#d t&at ma 2e

&o"din a "ot o+ peop"e 2ack.

AL

Yea&, o# know, 0 mean, 0 t&ink t&at% 8k, so in addition to t&e I$, inaddition to t&e miners t&at we saw, t&e miner man#+act#rers t&at wesaw: we a"so saw a w&o"e 2#nc& o+ "awers. -&is was rea"", 0 wass#rprised 2 &ow we"" represented t&e were. And o# know we sawt&e +irm t&at did t&e..

'

8& rea"", t&e "awers were act#a"" we"" represented6

AL


25/101

1e were act#a"" sittin in +ront o+ a ent"eman w&o represents t&eon"ine BA 0 t&ink is &is proect. 0t/s o#t o+ 'o#t& A+rica 2#t t&e &ave3,;;; "awers w&o &e speaks to and o# know, &e was t&ere #st"earnin a2o#t 2itcoins. 'o we ta"ked to &im +or a rea"" "on time. ewas ver interested. -&e/re a"so into permac#"t#re. $rsta" and &is

wi+e. Yea&, $rsta" spoke to t&em a2o#t permac#"t#re, m wi+epersona"". '&e/s t&e enineerK

'

'&e/s awesome. '&e/s o#r prod#cer.

AL

'&e/s o#r prod#cer. Cm, 2#t ea& t&e were we"" represented. 0n t&eta"ks it seemed "ike t&ere was a t&eme t&at 0 was a "itt"e 2it dist#r2ed2. 1&ic& is t&at 2itcoin +#ndamenta"" &as to c&ane in order to workin t&e "on term.

'

Yea&, 0 saw t&at, and 0 t&ink t&at 0 tota"" t&ink t&at/s inspired 2 t&ere#"ations t&at peop"e +ear are comin. And so t&e/re "ike, J1e"", o#know it/s not so 2ad i+ we don/t make it anonmo#s and we i+ we don/t

ca#se c&are2acks and i+ we 2#i"d c&are2acks into 2itcoin w&at/s t&e2i dea"6 1&at/s t&e 2i dea" is it/s not 2itcoin an more.

1e"" 0 t&ink it/s eas to con+#se a 2#siness opport#nit to +#ndamenta"c&anes to 2itcoin itse"+. 'o t&ese peop"e t&at/s w&at 2#sinesses are+or. Yo# see a "itt"e ap and o# +i"" t&at nic&e. 'o 0 t&ink t&at a "ot o+t&ese are #st oin to 2e a 2itcoin 2ack in 2#siness t&at are oin to+i"" t&e capacit to +aci"itate c&are2acks.

AL

1e"" 0 t&ink t&at/s t&e &ope is t&at o# wind #p wit& somet&in "iket&at. 0s t&at o# wind #p wit& "ike an ins#rance tpe o+ sstem w&eremerc&ants s#2scri2e and pa a +ee. And t&en t&ere/s t&e a2i"it to do


26/101

vo"#ntar c&are2acks and t&en o# &ave a t&ird%part ar2itrator w&ocan essentia"" come in and mediate t&at.

'

0t can &appen wit& escrow services now t&o#&. -&ere are some, 0mean t&at are startin...

AL

Yes, t&at/s tr#e, t&at/s tr#e, 2#t aain. Yo# add "aers o+ cost to t&ist&in ever time o# do st#++.

i&t.

AL

And 0 mean, and t&at aain is t&e pro2"em. -&at over t&e "on termt&e 5#estion is, are we t&rowin t&e 2a2 o#t wit& t&e 2at& water 2trin to +i4 t&ese pro2"ems are we in +act r#inin t&e sstem as aw&o"e.

'

Yea&, t&is revo"#tionar tec&no"o t&at is comp"ete" di++erent +romt&e Leac Bankin 'stem is so reat! 1e #st need to make it a "itt"emore "ike t&e Leac Bankin 'stem to make it 2etter. Yea&, and 0was dist#r2ed 2 t&e wa it was presented in a "ot o+ t&e ta"ks t&at 0saw. 1e need to do t&is. Yo# know, "ike it/s not so 2ad. Let/s #st tieo#r identities to a"" o+ o#r 2itcoin addresses and p#t a socia" sec#rit

n#m2er on it. Let/s "ike, o# know et rid o+ t&e irreversi2i"it o+transactions! And we need to do t&is, or e"se 2itcoin wi"" never etmainstreamed #p. And 0 disaree wit& t&at. And 0 was sad to see t&atsort o+, 0 #ess t&e wo#"d pro2a2" sa, we"" we/re 2ein pramatic.Beca#se t&is is onna &ave to &appen anwa i+ 2itcoin is onnas#cceed. 1e"" 0/m onna take t&e idea"ist position as 0 a"was do. And0 #st want to p#t it o#t t&ere and sa, 0 don/t t&ink t&at &as to &appen.And we can #se 2itcoin as it was initia"" intended and t&ere are


27/101

certain" #ses +or 2itcoin t&at don/t invo"ve sacri+icin some o+ t&osereat t&ins a2o#t 2itcoin.

AL

i&t, and o# know t&e option is a"was t&ere i+ o# want to createcomp" coin. 0 t&ink t&at t&at

'

("a#&s) $omp" $oin! Yea&, t&at wo#"d 2e a reat market idea.

AL

-&ere/s a e nic&e +or t&at 0 t&ink.

'

'ad" 0 t&ink t&ere are "ots o+ peop"e w&o wo#"d &ear it and t&e/d sa,J8&, o& ood, 0 can do evert&in t&e re#"ators want me to do.J

AL

Beca#se 0 t&o#&t... it does e4ist it/s ca""ed ipp"e.

A&, t&ere o# o. 1e"" even ipp"e &as some pro2"ems 2eca#se it issti"" not anonmo#s, 2eca#se it &as entr points and e4it points w&eret&ere/s identi+ication t&at asks..

'

1&at do peop"e critici7e ipp"e +or6 $an o# #st ive #s overview ont&at6 Beca#se 0 t&ink a "ot o+ o#r "isteners don/t even know w&atipp"e is "et a"one #nderstand t&e criticisms o+ it so "et/s ta"k a2o#tt&at.


28/101

'o, 0/m ass#min t&e/re reat entreprene#rs. 0/m not disparaint&em. A"" t&e power to t&em +or trin to 2etter t&e ecosstem. B#t

w&en it comes to "ookin at a"ternative crpto c#rrencies t&ere are aco#p"e o+ ke identi+iers as to w&et&er or not t&is is a scam. And w&eno# app" it to somet&in "ike ipp"e it kind o+ &as some warninsina"s. 'o one o+ t&em is pre%minin. 'o i+ o#/re

'

Are o# ta"kin a2o#t P w&ic& is t&e c#rrenc t&at ipp"e #ses6

Yes.

'

8ka, so "et/s sa w&at ipp"e is +irst, 0 mean.

'orr.

'

'o, ipp"e is "ike, #m... ("a#&s) so 0 don/t comp"ete" #nderstand iteit&er so correct me i+ 0/m wron. B#t, 2asica"" it/s a network w&ereo# can easi" convert di++erent c#rrencies. Let/s sa o# need to2orrow H; to et some roceries or somet&in. Like, o# co#"d tr#st

some2od w&o tr#sts some2od e"se in $&ina and t&e co#"d 2asica""send % "oan o# 2itcoins or "oan o# ipp"es or "oan o# 1ans orw&atever and o# co#"d et o#r H;. And "ike ipp"e is #st "ike t&emedi#m o+ e4c&ane a"" t&e "endin takes p"ace o#tside o+ ipp"e 0#ess. B#t it/s 2asica"" a sstem t&at/s 2#i"t on tr#st, networks2etween peop"e and it/s a wa to convert c#rrencies and e4c&anecredit peer%to%peer.


29/101

AL

i&t, and o+ co#rse a"" t&ose t&ins o# sa 2asica"" trans"ate to itsde2t transmission network. 1&ere essentia"" o#/re not. And t&is is

w& o# can send do""ars t&ro#& it so +ast. Aain, o# can senddo""ars as +ast as o# can send 2itcoin 2eca#se o#/re not rea""sendin t&e do""ars. Yo#/re trans+errin a de2t +rom somet&in t&ato# own and o#/re app"in it to some2od e"se.

And 0 t&ink w&en o# "ook at ipp"e it/s an ama7in iterative step ono#r c#rrent 2ankin+inancia" sstem.

AL

-&is is, t&is is important.

And 0 "ook at it, and 0/m "ike, 0 know +ive ears +rom now or t&ree ears+rom now w&en conress is onna start "ookin at t&is space t&e/re

onna 2e "ike, J1e"" w& can/t o# 2e "ike o#r 2rot&er6 ipp"e/s a2"e todo it &ow come o# #s can/t do it6 $/mon 2itcoin, et wit& it.J 'o 0t&ink t&at ripp"e is a reat transitor, o# know, transition into 2itcoin.

'

B#t t&at too", t&e de2t trans+er network e4ists o#tside o+ t&e crptoc#rrenc ipp"es. -&e crpto c#rrenc is somew&at simi"ar to 2itcoin.Yo# know, ri&t6 And t&at/s w&at o# were ta"kin a2o#t 2e+ore w&eno# said t&ere/s a red +"a 2eca#se t&e pre%mined P and t&en were

ivin t&em awa, is t&at ri&t6

Yea&.


30/101

'

'o ea&, o on, contin#e wit& t&at.

'o, 0 mean t&ere are a co#p"e o+ red +"as w&en o# are "ookin atcrpto%c#rrencies t&at #st et started and one o+ t&em is: &as t&eowner pre%mined it6 And i+ o# "ook at t&e distri2#tion o+ ipp"e t&atare in e4istence. Like ; peop"e own a sini+icant portion o+ t&e ipp"e.

AL

-&e pre%mined a"" o+ t&em, didn/t t&e.

Yea&. 0t/s 9;; pre%mined.

AL

B#t it/s a "itt"e 2it mis%"eadin 2eca#se in t&e ipp"e network o#/re notrea"", it/s not "ike 0/m onna send =; ripp"es to o# and t&en o#/re

onna cas& t&e ripp"es. 0t/s more "ike ipp"es are stamps. 1&ere it/s"ike an anti%spam mec&anism more t&an it is a va"#e trans+ermec&anic.

B#t 0 remem2er readin somew&ere t&at i+ o# "ooked at t&e c#rrentmarket price o+ a ipp"e and t&en o# m#"tip"ied it 2 t&e 9;;%2i""ionipp"es t&e &ave or w&atever it is, t&at it was e5#a" to t&e va"#e o+t&e market cap o+ t&e 2itcoin network.

AL

'o t&e ave t&emse"ves an impressive pre%market eva"#ation.


31/101

Yea& ("a#&s). 'o 0 don/t know &ow t&at works, 2#t it kind o+ "ooks "iket&e/re a2"e to print mone in m opinion.

Break

AL

Yo#/re "istenin to Lets-a"kBitcoin. -&e premier a#diocast providinnews and insi&ts t&at cover t&e rapid" evo"vin wor"d o+ diita"mone. 8#r twice week" s&ow inc"#de ana"sis o+ "ate 2reakin news,#pdates on ke, tec&nica", 2#siness and re#"ator iss#es % and in%dept& interviews wit& t&e ke peop"e drivin t&e new diita" econom.

Lets-a"kBitcoin o++ers sponsors an attractive wa to reac& a taretedand savv a#dience. For more in+ormation emai" sponsors atLets-a"kBitcoin.com.

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ore t&an 3;;,;;; #sers and co#ntin tr#st 2"ockc&ain.in+o. 0t/s a2itcoin wa""et service and a wea"t& o+ 2itcoin in+ormation and iscomp"ete" +ree to #se. 1it& t&e B"ockc&ain.in+o wa""et, o#/"" et t&econvenience o+ a we2 wa""et, and t&e sec#rit o+ a desktop c"ient.

B"ockc&ain.in+o is a"so a 2"ock e4p"orer. Yo# can #se it to see 2itcointransactions in rea" time, c&eck t&e 2a"ance o+ an 2itcoin address, anddo man &and 2itcoin c&arts, a"" +or +ree. 'ee w&at t&e &ave to o++ertoda. At B"ockc&ain.in+o.

AL

0 t&ink t&at w&at o# said t&ere a2o#t ipp"e 2ein an iterative step isrea"" important 2eca#se t&at/s t&e t&in. 0s t&at, ,i+ ipp"e &ad comeo#t% and to a certain deree 0 t&ink t&is e4tends to open transactionstoo, 2eca#se it a"so is a de2t transition mec&anism 2eca#se. Yo# can/t% 2itcoin and crpto%c#rrencies are so +"#id 2eca#se t&e don/t e4ist inrea" "i+e. 'o w&en o#/re ta"kin a2o#t assets t&at &ave rea" "i+epresence o# simp" can/t cram t&ose down and s&ove t&em t&ro#&an internet connection. 'o it &as to 2e a de2t transition mec&anism inorder to do t&at. B#t t&e t&in is t&at wit& 2itcoin and wit& crpto%c#rrencies o# don/t need to do t&at at a"". 0t/s #nnecessar. And


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especia"" w&en we move to a more diita" econom w&ere t&e need todo t&at at a"" oes awa 2asica"". 'o o# know, aain, it/s one o+ t&oset&ins w&ere i+ t&e ipp"e sstem &ad come o#t 2e+ore 2itcoin we/d 2e&avin a ver di++erent conversation now. And now it/d pro2a2" 2eLets-a"kipp"e. Beca#se 0 mean and aain, compared to t&e 2ankin

sstem we &ave now it/s so m#c& more e++icient compared to crptoc#rrencies. 0t/s "ess compe""in.

0 #st t&ink t&at i+ t&e t&in t&at 2itcoin does is +orce t&e c#rrent 2akinparadim to move to ipp"e and t&en t&e conversation is ipp"e vs.2itcoin. 0 t&ink t&at/s a +antastic wor"d to "ive in.

'

Yea&, 0 comp"ete" aree.

AL

And o# know, t&at/s an interestin point, 2eca#se o# know t&atcertain" co#"d 2e % ipp"e &as otten a "ot o+ &i&%pro+i"e investors.

And t&at certain" co#"d 2e t&e p"a t&e &ave in mind is t&at oka, soo#/ve ot t&ese crpto%c#rrencies 2#t t&eMre kind o+ +"at"incompati2"e wit& t&e e4istin +inancia" sstem so i+ we/re onna movetowards somet&in t&at/s more "ike t&at t&en t&is is an intermediarstep t&at we can take t&at we know a"read comp"ies and can 2e easi"interated in. And so t&en we #st se"" it essentia"" so+tware as aservice to a"" t&ese 2ankin instit#tions aro#nd t&e wor"d. Bo2/s o#r#nc"e, o# know we/re t&e de+acto center o+ it a"" aain. 0t/s a verinterestin space +or t&em to operate in ri&t now 0 t&ink.

1as t&ere someone +rom ipp"e at t&e con+erence6

AL


33/101

Yes. 0/m not s#re i+ 0 ta"ked to anone +rom ipp"e. -&e coin t&in andt&e open t&in, ver ver di++ic#"t. 'o man companies t&ere &avet&ose in t&e names. 0t/s "ike w&en 0 #sed to work in t&e reen spaceand ever2od #sed to &ave "ike reen or 2io or a"" t&ose ot&ernonsense. And it/s "ike aain, t&e +irst co#p"e companies t&at do it.

-&at/s reat. And t&en t&e ne4t ;; companies t&at do it % it/scon+#sin!

'

'o i+ o# meet someone new and o# +oret w&at compan t&e/rewit& o#/re "ike, J8& ea&, o#/re +rom coin...J 0/m "ike, JYea&, $oinPe, Yea&.J

0 saw 3 di++erent acco#ntants w&o &ad a p"a on 2itcoin acco#ntant int&e name. And 0 #st co#"dn/t remem2er t&em 2eca#se t&e were sosimi"ar in t&e name.

'

0 ot some peop"e remem2erin variations o+ Lets-a"kBitcoin act#a"""ike. 'omeone oes, J8&, ea&. Yo#/re +rom Bitccoin-a"k.J And t&en

someone oes, JYo#/re +rom Bit-a"kLive.J. ("a#&s) Lets-a"kBitcoin68& rea" 5#ick. 1&at/s t&e di++erence 2etween ipp"e and 8pen $oin or8pen transactions6

AL

8pen transactions. 'o ipp"e is t&e prod#ct o+ a compan ca""ed 8pen$oin. And 8pen transactions is a prod#ct o+ a compan ca""edono-oss. And we/ve interviewed $&ris 8dom 2e+ore,, &e oes 2Fe""ow -rave"er. e/s a podener o+ t&at tec&no"o. 0 t&ink &e/s moreo+ a marketer t&an a code #. B#t &e manaed to p#t it toet&er tot&e point w&ere &e/s rea"" 2een a2"e to attract some attention. 0 knowt&at t&e eit&er &ave #st +#nded or t&e are in t&e process o+ +#ndinri&t now and are raisin a prett decent amo#nt o+ capita" 2eca#seaain. -&ere/s a "ot o+... o# know aain, w&en o#/re ta"kin a2o#tt&ese sstems it/s so m#c& easier to comp" wit& t&ese vario#s de2ttrans+er mec&anisms 2eca#se t&e interate so m#c& 2etter so o#


34/101

know aain t&at/s w&ere a "ot o+ t&e mone seems "ike it/s oin. -&atand a"tcoins too, t&ere are some a"tcoins t&at are ettin sometraction.

'

0 ta"k to a "itecoin deve"oper esterda, and t&ere were some "itecoinpeop"e t&ere, and t&e were so coo" and p"easant to ta"k to. And 0 was"ike 0 can/t wait to see w&ere t&e/re oin. 0 t&ink we/re onna &avean interview wit& 1orm w&o is one o+ t&e "itecoin dev/s to ta"k a2o#tt&e new re"ease and w&at t&e/re oin to do wit& "itecoin in t&e+#t#re. And 0/m #st impressed wit& "ike... t&ere/s more in+rastr#ct#ret&at/s comin o#t. Not #st wit& "itecoins 2#t wit& a"" t&ese di++erenta"tcoins. A "ot o+ t&ese coins are w&ere 2itcoin was a co#p"e o+ earsao. And 0 t&ink peop"e see t&at and ma2e +ee" "ike t&e missed t&e

2oat or w&atever. -&e ot in too "ate and t&e want to et in. 0 t&inkwe/re sti"" ver ear" in t&e adoption c#rve o+ even 2itcoin. B#t it/stemptin, o# see an a"t coin and it "ooks "ike it &as potentia", o#know, o# wanna et in on t&e ro#nd +"oor and see w&at it does.

AL

E4act", o# know t&e m#"tip"ier is #st so enormo#s. Aain, o# "ookat 2itcoin, certain" a m#"tip"ier. 0t co#"d 2e enormo#s ass#min o#&ave a w&o"e 2#nc& o+ ndred do""ars to t&row at 2#in some

2itcoin. B#t o# know, wit& t&e a"ts, t&e 2# in, o#/re ta"kin a2o#tpennies,. And t&e potentia" is sti"" t&ere +or t&at price increase. 1edon/t ta"k a2o#t t&e price 2#t +rom a spec#"ative standpoint, it seems"ike i+ o# co#"d identi+ t&e ri&t a"ts t&at act#a"" &ave t&e ri&tc&aracteristics to ive #s a c&ance o+ makin it 2i, t&at is rea"" w&eret&e e4ponentia" potentia" is +or a ver sma"" investment to convert intoa 2i one.

'

Yea&, and 0 remem2er one o+ o#r +irst episodes o+ Lets-a"kBitcoin, 0want to sa it was "ike 3 or . 1e ta"ked a2o#t a"tcoins and we ave ar#ndown o+ some o+ t&e most pop#"ar ones. 1e"" even now #st a +ewmont&s "ater, t&ere are ndreds o+ a"tcoins. And no2od can keept&em strai&t. 0 was ta"kin to some2od esterda, and 0 said so w&atare t&e ot&er script%2ased a"tcoins6 And &e said o&! -&ere are at"east ; 0 can name o++ t&e top o+ m &ead. 0 said ;6 0 on" know o+


35/101

"ike =!

Y/know, it/s a testament to t&e space t&at 0/m kind o+ eatin m words.'evera" mont&s ao 0/d kind o+ make +#n o+ "itecoin, and now t&edisc#ssion is, ma2e 2eca#se o+ minin centra"i7ation 2itcoin needs to2ecome more "ike "itecoin. 'o o# know o#/re seein t&e +ree marketat work 2eca#se w&en o# a""ow peop"e to do w&atever it is t&e wantto do in t&e space, t&e market "eader &as to "earn +rom t&e trai".

'

0 t&ink it/s rea"" important to keep an open mind. 0+ o# "ike t&e

concept o+ 2itcoin, or i+ o# #st "ike t&e concept o+ crpto%c#rrenc inenera", i+ o# "ike ant&in a2o#t it. ea"i7e t&at t&ere/s t&e potentia"% "ike, we/re sti"" +i#rin t&is o#t and ma2e it/s 2itcoin, ma2e it/s"itecoin, ma2e it/s some ot&er coin, or ma2e it/s onna 2e a 2#nc& o+di++erent coins. -&at/s onna predominate. $omin #p.

AL

over t&e "ast = mont&s 0/ve rea"" one +rom t&ere can 2e on" onecamp to rea"i7in t&at/s pro2a2" act#a"" not oin to 2e t&e case.

And it/s 2eca#se (2eep) &appens, and st#++ c&anes, and w&en t&insc&ane. And o# know, t&at/s t&e t&in, is t&at "ike, w&en t&insc&ane it/s onna &appen +ast. 'o now w&at 0 &ave kind o+ over t&e"ast +ew weeks come to 2e"ieve is t&at ri&t now we/re in essentia"" a2e"ie+ 2#22"e. 1&ere ever2od "ooks at t&e crpto c#rrenc space.And 2eca#se it/s so new t&e "ook and t&e sa, oka, 2itcoin is t&eone. And t&en t&ere/s a"" t&ese ot&er ones. -&e don/t matter. Andt&e don/t matter ri&t now. B#t it/s 2eca#se peop"e on" "ook at2itcoin. 1&at/s onna &appen is t&e/re onna see some destr#ctivec&anes comin in 2itcoin/s +#t#re w&et&er or not t&e deve"opin team"ikes it and 0 t&ink t&at we/re pro2a2" oin to wind #p seein t&ati""#sion to t&at 2#22"e et popped. -&e i""#sion dispe""ed and at t&atpoint s#dden" it wi"" 2e a w&o"e new 2a"" ame i+ o# start an a"t. AnditM"" 2e m#c& more a2o#t t&e merits o+ o#r c#rrenc rat&er t&an a2o#tw&et&er or not o#/ve a"read ac&ieved an (ina#di2"e (;:=9). Aain,2eca#se t&ere/s t&at potentia" +or t&e e4ponentia" m#"tip"ier o+ versma"" investments to convert into ver "are ones.


36/101

'

-&ere is somet&in to 2e said +or ac&ievin t&e network e++ect t&o#&.

AL

$ertain". 0t/s no sma"" 2arrier 0 don/t mean to sa t&at.

Essentia"" w&at o#/re sain is we/re waitin +or 2itcoin to &ave itst. *o4 event.

AL

i&t, e4act", 2#t o# can t&ink a2o#t it "ike t&is. 1&en 2itcoin &as itst. *o4 event instead o+ a"" t&e mone in t. *o4 2ein "ocked down,2itcoin is tota"" "i5#id. 'o it/s ver ver eas to #st (2eep) s"ip intot&e ne4t one. 0 &ave to edit t&at. 0/ve 2een swearin +or t&e "astco#p"e o+ das...

0t/s New York it does it to o#. ("a#&) 0 mean 2#t ea&, o# &ad acompan t&at &ad evert&in oin +or it. 0t &ad @;%somet&in percento+ t&e space and t&ro#& a series o+ #n+ort#nate events, t&at wo#"d&ave &appened to anone w&o % t&e point a2o#t a trai"2"a7er.

'

0t took a "ot o+ #n+ort#nate events t&o#&, 0 mean once it ot to t&ecritica" point it was &ard to knock it down o++ t&e pedesta", ri&t6

i&t, and 0 mean t&e same co#"d 2e said a2o#t 2itcoin +or e4amp"e,peop"e "ike to +oret t&at 2itcoin is ;.> version ri&t now. 0t is sti"" a2eta. 0t is a m#"ti%2i""ion do""ar 2eta. And, w&at/s to stop some randomerror t&at no one &as seen #st wreckin t&e w&o"e t&in6


37/101

AL

8&, so we s&o#"d ta"k a2o#t t&at. 8n t&at note, so we &ad someconversation +rom some miners, 'tep&anie 0 know t&at o#

interviewed. 0 &ad some conversations o++ t&e record wit& some peop"ea2o#t t&is kind o+ 5#estion. 'peci+ica"" a2o#t, we ta"ked a2o#t 8PE$was it6

'

8E$

AL

8& &eck, o& &eck, t&at was it.

'

8rani7ation asin Power E4porters

AL

Yea&, t&at/s ri&t, so some peop"e didn/t #nderstand w&at we wereta"kin a2o#t. 0t was kind o+ a oke, 2eca#se, t&e o& &eck was kind o+ aoke. Beca#se in order +or t&at... in case o# &aven/t "istened to t&e"ast episode w&ere we ta"ked a2o#t t&is, 2asica"" GN$ miner re"easeda statement sain t&at t&e were oin to stop s&ippin A'0$ #nits+rom Novem2er t&ro#& 9 o+ =;9 wit& t&e idea 2ein t&at t&is wo#"dprotect t&e investment o+ t&e peop"e w&o &ave p#rc&ased e5#ipmentcomin 2e+ore 2eca#se in = t&e/re oin to re"ease, and t&e co#"din 9 2#t t&e/re onna &o"d it #nti" =... #m, are oin to re"ease&ardware t&at is orders o+ manit#de c&eaper and +aster t&an w&at

peop"e &ave previo#s" ordered. And so i+ t&e were to re"ease it att&e pace o+ tec&no"o t&en t&e peop"e w&o were ettin t&is minin&ardware wo#"d 2e a"most instant" o2so"ete and &ave no opport#nitto earn t&eir mone 2ack. And o+ co#rse t&at/s 2ad i+ o#/re a 2#sinesst&at tries to &ave c#stomers t&at 2# o#r prod#ct i+ o#/re iteratin so+ast wit& t&e tec&no"o t&at peop"e can/t even &ave a c&ance to make2ack t&eir investment.


38/101

A"t&o#& 0 wo#"d "ike to sa in t&is space t&at 0 persona"" t&ink t&at/s areat marketin pitc& +or t&eir compan 2#t t&at i+ o# "ook at w&at

&appened in t&e past wit& EFC o+ Ava"on. e &ad said &e "ook, we/ret&e market "eader #st 2eca#se 0 &ad no idea t&at ever sin"e ot&ercompan wo#"dn/t s&ip. 1&en o#/re ta"kin a2o#t &ow s#ccess+#"o#/re onna 2e at e4ec#tin in t&is space it/s a space t&at &as a "ot o+peop"e not e4ec#tin. 'o 0 #st t&ink t&at i+ t&e co#"d do w&at t&esa t&e/re onna do t&e s&o#"d #st do it. Beca#se e4ec#tin in t&isspace is so rare t&at 0 t&ink t&e market needs t&at more t&an it needssomeone 2ein it/s Batman. -&e protector it ma not need 2#t itneeds... it doesn/t know 2#t it wants.

AL

Yo# know 0 aree wit& o# t&ere, 2#t t&at/s t&e t&in. 1&en ta"kinwit& t&ese #s 0 spoke wit& t&e # 'am +rom.. was t&at &is name6

'

'am.

AL

'am +rom GN$. And a"so t&ere were one or two ot&er A'0$man#+act#rers w&ose names 0 didn/t catc& in t&is "itt"e conversation wewere &avin. Yo# know t&at o#/re onna &ave to et toet&er wit& a""t&e ot&er p"aers o#t t&ere and o# #s are a"" onna &ave to stops&ippin,

'

Yea&, "ike a carte".

AL

Yea&, e4act" e4act". And &e was "ike, ea& 0 know. -&en we startedta"kin a2o#t &ow, &e started te""in me &ow it was ood +or 2itcoin


39/101

and &ow t&e were #st oin to et toet&er and t&e/d +i&t +or t&reemont&s and t&en t&e/d 2e "ike ok #s, "et/s o 2ack and re%work o#rtec&no"o. -&en we/"" come 2ack t&ree mont&s "ater. 1e/"" +i&taain. 'o we/"" &ave t&ese on and o++ aain re"ease sc&ed#"e t&at/scoordinated t&ro#&o#t t&e space. And so aain, &e +e"t % we t&o#&t

it was a oke. 1e t&o#&t it was a marketin p"a. At "east 0 certain"did w&en we were ta"kin a2o#t it 2e+ore. 'peakin wit& t&ese #s,t&e were dead serio#s a2o#t it. -&at is t&eir p"an. 0 mean, do o#t&ink t&e can p#"" it o++6

'

8&, os&. 0 mean, a "ot o+ t&e ot&er companies were sain, ea& 0t&ink we/"" p"a. 0 t&ink we/"" do t&at.

AL

Yea&, os& +rom B#tter+" La2s, ea& said somet&in. Basica"", so 0was "ike o# know, so t&ese #s are onna tr to do t&is, 0 spoke tot&em separate".

'

B#t 0 #ess t&e 5#estion is, is t&ere some ot&er compan o#t t&ere w&o

is 2ein comp"ete" 5#iet, and is tota"" o++ t&e radar is a wi"d card andis oin to come #p wit& some power+#" A'0$ d#rin t&at time +rame.And t&at co#"d t&row a wrenc& in ever2od/s work. GN$ said t&at i+some2od does t&at t&e/re onna contin#e to re"eae t&eir devices as2est t&e can.

AL

i&t, e4act", e4act", so t&at/s t&e t&in, i+ t&e carte" +ai"s, t&enever2od is #st +ree +or a"" wi"d west aain, ever2od re"eases as+ast as t&e can. And o+ co#rse t&en t&e 5#estion 2ecomes w&at/s t&e2a"ance 2etween re"easin so t&at o#/re t&e +irst one o#t and o#/ret&e +irst. Beca#se ot&erw% i+ o#/re t&e "ast man o#t t&e door, t&enc&ance are prett ood. Peop"e w&o are e4cited a2o#t 2#in t&atespecia"" wit& as +ast as t&e tec& is movin are not oin to &ave anreason to 2# o#r prod#ct. Cn"ess t&ere/s a materia" advantae. Andit doesn/t rea"" seem "ike anone is oin o#t o+ t&eir wa. 1&at 0/ve


40/101

2een waitin +or is a tr#" p"#%n%p"a A'0$ so"#tion. And as +ar as 0/mconcerned we sti"" &ave et to see ant&in "ike t&at.

Yo# know t&e Ava"on at Bit0nstant &as 2een not opera2"e in t&e pastco#p"e o+ weeks #st 2eca#se it 2roke and no one knows &ow to +i4 it.'o t&e one 2itcoin per da t&at it co#"d 2e makin +or t&e +o#ndation.

'

0s t&at w& (0+#) is &ere to +i4 it6

Yea&, t&at/s w& &e came 2ack +rom $&ina. 'o t&e/re #st "ike a&&&,t&e c"ear" &ave ot&er t&ins t&at t&e &ave to dea" wit&.

AL

i&t, we"".

-&ese t&ins are comp"icated.

AL

-&e are!

'

0/ve seen a pict#re o+ t&at t&in and it/s +#nn 2eca#se "ike o# seeA'0$s advertised on"ine and it/s "ike a s"eek "itt"e 2"ack 2o4 wit& o#know a C'D ca2"e comin o++ o+ it. -&is t&in "ooks "ike... 0 don/t know,it "ooks "ike a printin press. 0t/s 2i, it/s "ike open, it doesn/t &ave anice case or ant&in 2#t it works. 8r at "east it did work #nti" #st aco#p"e weeks ao. B#t, ea&, t&at was a w&i"e ao t&at t&e +irst 2atc&


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o+ Ava"on A'0$s s&ipped, so it/s 2een opera2"e +or a w&i"e.

Yea&, t&e &ad a ood r#n.

'

Yea&, de+inite". -&e were in a reat position. B#t 0 mean 'am wassain +rom GN$ miner t&at t&is is act#a"" ood +or 2itcoin. 0t/s notcentra"i7in it/s act#a"" t&at t&e/re trin to et A'0$s into t&e &andso+ as man peop"e as possi2"e. -&e averae person, and &e wassain t&at A'0$s are a rea"it, everone/s oin to 2e &avin t&em atsome point, and we/re onna tr and et t&em into as man &ands as

possi2"e so t&at t&e minin power is distri2#ted.

'o o# #s were on one o+ w&at 0 wo#"d sa one o+ t&e mostinterestin pane"s. onat&an and 'tep&anie, o# #s were 2ot& on t&eBitcoin O Free 'peec&, moderated 2 o#r ood +riend ark os&tein+rom American Banker.

'

Yea&, &e was so coo". 0 ot to know &im t&e ot&er ni&t, ea& &e wasrea"" +#n to ta"k to.

arks/ t&e man. 0/"" te"" o# t&at.

'

-&at was a +#n pane". 1e ot a "ot o+ positive +eed2ack on it. 0t wassort o+ a nice co#nter%2a"ance to a"" t&e peop"e sain ea& we needmore re#"ation. And we were "ike no, 2itcoin is +ree speec&!


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Yea&, we"" 0 t&ink an pane" t&at in min#tes ta"ks a2o#t prostit#tion,dr#s and #ns is doin t&e ri&t t&in to 2itcoin.

'

1e"" Adam ot some a#dio o+ it so 0 t&ink o#/"" 2e a2"e to &ear t&atprett soon.

AL

Yea& ea& ea&, it t#rns o#t t&e weren/t +i"min an o+ t&e ta"ks t&ere.'o 0 took t&e , t&at/s w&at we/re recordin on ri&t now, and 0 ot a

direct +eed o#t o+ t&e 2oard. And t&en o+ co#rse +or a2o#t &a"+ o+ t&em0 +orot to press t&e 2#tton twice. Yo# &ad to press t&e 2#tton twice ont&is t&in ot&erwise it doesn/t work. And 0 was r#nnin aro#nd t&eentire time, 2#t 0 on" ca#&t ma2e 3 or o+ t&e ta"ks. B#t t&e onest&at we did et we are oin to 2e re"easin.

'

-&at/s reat, ea&. 0/m rea"" "ad o# did t&at. 0 wasn/t e4pectint&em not to 2e +i"min. B#t ma2e, ea& ma2e t&e ne4t event t&e

wi"".

AL

1e"", w&at 0% so aain, so t&is event was rea"" coo". 0 act#a"" t&o#&tt&e event was prett interestin, p#t on prett we"". 0t was a "itt"e 2itmore e4pensive t&an 0 wo#"d &ave "iked. 0 know some peop"e co#"dn/tattend 2eca#se t&e cost was simp" prett &i& re"ative to t&e% o#know, t&e 'an ose con+erence was "ike H9>; +or a two da event. -&isone i+ o# ot t&e ear" 2ird price it was H=@@. 0+ o# #sed o#r =;

co#pon it/s "ess t&an t&at.

'

For one da.


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AL

For one da. And at t&e door it was H@@.

1ow.

'

ea""6 0t was packed t&o#&.

AL

Yea&. 0t was packed. 0t was packed. And aain, over time peop"emore dri+ted o#t o+ t&e ta"ks and more into t&e networkin area andt&at/s w&at &appened wit& 2ot& o# and 0.

B#t t&e t&in a2o#t t&ese con+erences is it kind o+ is a2o#t t&e pricet&at t&e c&are #st 2eca#se t&e price is an indicator o+ &ow 2ad o#want it.

AL

we"" it determines t&e tpe o+ a#dience t&at o# et.

-&at/s w&at 0/m sain, so o# know t&at t&e ot&er person wanted it2ad eno#& to eit&er scam t&eir wa into t&e con+erence as 0 &appenedto &ave done. 8r to act#a"" &ave paid t&e +ee.

'

0t/s not scammin we ave t&em somet&in o+ va"#e.


44/101

-r#e. -&at/s tr#e.

'

'o ea&, 2ack to t&e pane". 'o 0 t&o#&t it was rea"" coo" 2eca#se weot to ta"k a2o#t wiki"eaks and some o+ t&e potentia" 2itcoin &as to&e"p orani7ations t&at mi&t 2e marina"i7ed. And t&e idea o+ 2itcoinne#tra"it w&ic& is somet&in 0 know is rea"" interestin to Andreas so0/m c#rio#s to &ear &is t&o#&ts a2o#t t&at. B#t t&e idea o+ ne#tra"it2ein% o# know, i+ o# &ave a tec&no"o "ike 2itcoin t&at an2odcan #se,, t&at/s #st it! An2od can #se it, ri&t6 'o some peop"e,t&e/re onna 2e peop"e o# don/t "ike, t&at #se it. And t&e/re onna#se it +or t&ins t&at o# don/t "ike. B#t t&ere are a"so onna 2e peop"ew&o are reat w&o #se it, and w&o #se it +or t&ins t&at o# do "ike.And o# can/t et rid o+ t&e so ca""ed 2ad peop"e wit&o#t ettin rid o+ever2od/s privac and +reedom. 'o...

AL

i&t, t&is is t&e t&eme t&at comes #p over and over and over aain.And it was ta"ked a2o#t in o#r pane" prett e4tensive". -&e idea

2ein t&at i+ t&e point is to protect #s +rom crime, and to protect t&ewor"d +rom certain tpes o+ t&ins "ike terrorism, man tra++ickin andt&ins "ike t&at. -&en t&at/s a"" we"" and ood. And t&at/s a no2"e oa".B#t 'tep&anie, o# &ad a reat point. Yo# said it/s a"" a2o#tdi++erentiatin t&e transaction +rom t&e act#a" crime. And t&edi++erentiatin +actor t&ere is t&at a crime &as a victim w&ereas a+inancia" transaction &as a recipient. -&at mi&t 2e somet&in t&atena2"es t&e crime. B#t it/s t&e crime%

'

8& p"ease, victimi7e me 2 sendin me mone.

AL

B#t it/s a"" a2o#t esta2"is&in t&at &arm is act#a"" done not t&atsome2od paid +or somet&in t&at mi&t &ave potentia"" ca#sed a


45/101

pro2"em down t&e road. Beca#se once o# start doin t&at it ives o#t&e rationa"e to start "istenin to ever2od to start trackinevert&in. And t&at mi&t make sense in some sort o+ weird A"ice 0n1onder"and, t&ro#& t&e "ookin "ass wor"d. B#t 0 t&ink in t&e wor"dwe "ive in most peop"e wo#"d aree t&at i+ @@.@@ o+ peop"e aren/t

doin st#++ "ike t&at. And o# know t&at sma"" percentae is % itpro2a2" doesn/t make sense, is inconvenient and essentia"" removet&e privac o+ t&at @@.@@ t&at aren/t doin t&ose 2ad t&ins #st to trand stop or at "east detect. Beca#se t&at/s t&e ot&er t&in o+ co#rse ist&at we/re not even ta"kin a2o#t stoppin t&ese t&ins +rom&appenin. 1e/re ta"kin a2o#t p#nis&in t&em. P#nis&in t&em a+tert&e +act so 0 mean it makes no sense. E4cept o+ co#rse in t&is A"ice 0n1onder"and wor"d we "ive in.

Yo# know w&en t&e $E8 o+ Discover was interviewed and t&e ow&at do o# owe o#r s#ccess to6 e said. Yo# know, s&arks andNa7is. And 0 kind o+ +ee" "ike w&en it comes to 2itcoins and w&en itcomes to sec#rit, it/s a"was t&e terrorists and t&e pedop&i"es. Andt&at/s a"was t&e disc#ssion o+ evert&in a"was comes down to t&e .;9 o+ 2ad actors t&at need to dictate t&e rest o+ t&e @@.@@ o+ t&emarket. And it #st drives me insane 2eca#se w&en o#/re ta"kina2o#t 2itcoin it/s, not&in e4ists in t&e vac##m. 0t/s a"was incompared to w&at. And w&en t&e ent"eman asked t&at 5#estion o+..

'

Yea&, ri&t, &ow man cas& transactions are #sed in activities t&atpotentia"" rt peop"e and do &ave victims and... 0 mean, 0 wo#"dar#e t&at 2#in dr#s +or persona" cons#mption is a victim"esscrime.

i&t o# weren/t oin to win t&at ar#ment t&ere.

'

0 don/t know, 0 t&ink some peop"e were smpat&etic to #s. Especia""t&e # w&o asked t&at 5#estion. B#t, #m, 2#t ea&. 1&en o#/re


46/101

ta"kin a2o#t t&ins t&at act#a"" are crimes, t&at act#a"" &ave avictim, t&at are ca#sin &arm to peop"e. 8rders o+ manit#de more o+t&ose are done in cas& or are done t&ro#& t&e "eac 2ankin sstem.0 mean, 0 t&ink 0 2ro#&t #p t&e point on t&e pane" t&at dr# dea"ers,"oan s&arks, t&e &ave 2ank acco#nts.

AL

And o# know, A""en 'a+onte, o& os&, 0/m pro2a2" misprono#ncint&e name. As+a&e6 8k, ea&, #m, +rom ipap. Yo# know, &e/s an0ranian and &as 2een "ivin in t&is co#ntr +or a "on time. And one o+t&e t&ins t&at &e ta"ked a2o#t was &ow ri&t now o# can o into anstore and 2# essentia"" H;; o+ +ree paid Iisa cards or prepaid de2itcards and t&ere/s no GY$ processors, no identit processorsw&atsoever. Yo# can o in and o# can 2# a s&oe2o4 +#"" and t&e are

#st as ood as cas&...

'

-ake /em across t&e 2oarder.

AL

E4act" so it/s "ike, so t&e idea &ere is t&at on t&e internet it/s di++erent.

0 mean, o# t&ink a2o#t it, and it/s not di++erent. 0t/s not di++erent at a"",t&ere/s not&in di++erent a2o#t it.

1e"", 0 mean, t&e internetMs di++erent. #st 2eca#se randdad doesn/tknow &ow t&e t#2es work...0 mean o# "ook at p#nis&ment in terms o+t&e internet and o# ra++iti a p"ace and o#/"" et some comm#nitservice. B#t o# DDo' a resta#rant or a we2site and now o# etears. And it/s a compra2"e act o+ writin ra++iti or takin a site down+or a +ew min#tes. Especia"" i+ t&ere are no damaes i+ it/s a non%commerce site. And it/s #st t&e prosec#tions o+ t&ins t&at arecomp#ter re"ated are...

'


47/101

-&at/s w&.. ok, so it so#nds "ike w&at o#/re sain 2asica"" is t&at t&ere#"ations or "ike t&e "ea" sstem &asn/t ca#&t #p wit& t&e +act t&atwe &ave t&e internet and t&ere are ana"oies to "ike rea" wor"d p&sica"t&ins t&at &appen in t&e wor"d inc"#din so%ca""ed crimes and st#++ "iket&at. And so, w&at 0 wonder is, t&ere m#st &ave 2een peop"e... and

peop"e compare 2itcoin to t&e internet in 9@@=, 2itcoin ri&t now. 'ot&ere m#st &ave 2een peop"e in t&e ear" das o+ t&e internet w&owere trin to ed#cate t&e "eis"ators and were trin to te"" t&eovernment t&is is w&at t&e internet does and &ere/s &ow o# canre#"ate it in a wa t&at makes it +riend" to #s. -&ere &ad to &ave2een peop"e trin to do t&at 2#t it sti"" &asn/t ca#&t #p. 0 mean, =;ears "ater we sti"" don/t &ave modern "aws t&at #nderstand t&einternet in a wa. 0t/s sti"" sort o+ 2ack in t&e.. comparin it to p&onesand +a4es and t&ins "ike t&at.

Gevin itnik &as an ama7in a#to%2iorap&. And in it &e writes a2o#t&ow &e wo#"d &ack a"" o+ t&ese esta2"is&ments 2#t &e wasn/t doinant&in i""ea" 2eca#se t&ere were no "aws on t&e 2ooks on it. 'ot&e were "ike, a"ri&t weM"" "et a o t&is time. And t&at was #st anama7in time to e4perience and w&ere t&e internet was so new t&att&ere were no "aws on it #st "ike 2itcoin is ri&t now.

AL

'o w&at/s t&e ?;%second 2iorap& as o# know it on Gevin Bitnik +ort&ose w&o don/t know6

'o it/s ca""ed a *&ost in t&e ac&ine. And essentia"" it/s w&at ta#&tme t&at Gevin Bitnik is c&aotic ne#tra". Beca#se &e &ad t&e power totake down 2i""ion do""ar esta2"is&ments and &e co#"d &ave 2een t&e#"ian Assane a ndred times over 2#t #st wanted to do it so t&at &eco#"d 2e a p&one p&reak and #st "ike prank ca"" peop"e. e once otc#t o++ in tra++ic and ot t&e #/s "icense p"ate n#m2er, ot &is ce""p&one n#m2er, ca""ed &im a +ew min#tes "ater and t&en said t&at i+o#/re ever on t&e road aain 0 wi"" take o#r "icense awa +rom o#.-&at/s t&e power t&at &e &ad. And &e didn/t #se it +or ood, &e didn/t#se it +or evi", &e #sed it +or Gevin Bitnik.


48/101

AL

e #sed it +or Gevin Bitnik. $&aotic ne#tra".

$&aotic ne#tra". B#t it/s a +antastic 2ook. -&at and 1e Are Anonmo#skind o+ rea"" ive o# a ood #nderstandin o+ w&at it/s "ike in t&e&acker space especia"" w&en it comes to dea"in wit& t&e "aw.

'

Yea&. 0 #ess t&e point on t&at was t&at i+ we don/t &ave internetre#"ations t&at aren/t modern and ca#&t #p wit& t&e times so%ca""ed.

1&at makes peop"e t&ink w&o are ar#in now t&ink o& we need tore#"ate 2itcoin6 1&at makes peop"e t&ink t&at t&e/re onna pass"aws t&at are modern and w&at t&ee peop"e want +or 2itcoins6

B#t 0 don/t t&ink it/s a2o#t t&at w&en it comes to t&e re#"ation. 0 "ookat re#"ation as a t&in t&at/s needed 2eca#se w&en 2#sinesses needinvestment, w&en 2#sinesses need a 2ank acco#nt, t&ere needs to 2esome risk mitiation t&ere and o# can/t invest in an #nknown

#nknown. And #nti" t&ereMs some precedent set in t&e "ea" space2itcoin 2#sinesses are so to4ic t&at 2anks don/t even want to ive o#an acco#nt. -&ere was an entreprene#rs&ip...

'

0t/s oka o# don/t need an acco#nt.

AL'ometimes o# do.

i&t. -&ere was a 2#siness, t&ere was an entreprene#rs&ip pitc&


49/101

contest ear"ier t&is mont& and t&e woman w&o won, won 2eca#se s&e&ad 3 separate 2ank acco#nts in 3 separate p"aces t&at ave &er anacco#nt.

AL

'o anwas, we/re #st a2o#t o#t o+ time &ere. *#s, t&is &as 2eenreat. onat&an, o# did rea" we"".

-&ank o#, it was a p"eas#re.

AL

-&is is ood, t&is is ood.

'

Yea&, t&is was +#n.

AL

'o ea&, t&is was a +#n con+erence, so t&ere/s anot&er one. 'o 0 knowo#/ve 2een invited to speak at t&e one in Las Ieas t&at/s &appeninin Decem2er, ea&6

Yea&, t&at/"" 2e a "ot o+ +#n.

AL

Yea&, it so#nds "ike t&e/re oin to &ave a "ot o+ t&e same speakers.0/ve a"so 2een invited 2ack.


50/101

'

0nvited 2ack6

AL

-&e/re doin anot&er event. -&e/re doin anot&er one o+ t&eseevents in Decem2er. Yea&, edia Bistro, t&e same compan t&at p#tt&is on.

A"t&o#& it/"" 2e in an even +#nner conte4t. 0t/s t&e socia" amin andam2"in con+erence.

AL

1e"" m #nderstandin is act#a"" t&at t&ere are two oin on at t&esame time, t&e 2itcoin one and t&e socia" amin one.

'o it is t&e socia" amin and am2"in con+erence and t&e &ave

m#"tip"e tracks. And &e is oin to add a 2itcoin track to t&atcon+erence. 'o &e rea"" wants to et t&at Eric Ior&ees on t&at pane".'o i+ anone &as a am2"in compan and t&e wis& to &ave a p"ace topromote it 0 wo#"d certain" ta"k to edia Bistro ri&t now.

AL

'o #s, t&anks aain, once aain t&ank o# +or oinin me t&is wasepisode 3;, 0 #ess t&at/s anot&er mi"estone we don/t rea"" ce"e2ratemi"estones 2eca#se t&e come 2 so +ast. 0 don/t know, we &ad 2acontoda so

An time o# &ave 2acon it/s a ce"e2ration.


51/101

AL

("a#&s) Fair eno#&. A"ri&t #s. 1e/"" see o# ne4t time on anot&erepisode o+ Lets-a"kBitcoin.

-&anks +or "istenin to t&is portion o+ o#r specia" Lets-a"kBitcoincon+erence coverae. Bi t&anks to edia Bistro +or p#ttin on awonder+#" even at 0nside Bitcoins. 'ta t#ned +or more to come overt&e co#rse o+ A##st. 0+ o# &ave an comments or 5#estions +or medirect" o# can emai" Adam at Lets-a"kBitcoin.com. 0+ o# &ave5#estions, comments, or s#estions directed at t&e s&ow 2road",p"ease visit "etsta"k2itcoin.comreddit. 'ee a ne4t time! (m#sic)

i +o"ks, Adam E. Livine &ere +or Lets-a"kBitcoin. $ontin#in o#r A##sttrend, toda/s episode, is a two%parter. -&e second portion o+ toda/s

episode was recorded in an&attan. -&e da a+ter t&e 0nside Bitcoinsevent wit& 'tep&anie #rp& and specia" #est &ost onat&an o&ano+ Bittcoin NY$. 1e ta"k a2o#t t&e con+erence, t&e attendees, ripp"e,A'0$ minin pane"s, and a"so 2acon. Bi t&anks to onat&an o&anw&o did a reat o2 wit& t&is sement and w&o o#/"" 2e &earin more+rom in t&e weeks to come. B#t +irst, t&ere/s some important newsnews +or #sers o+ Android wa""ets. 1&en news 2reaks in t&e 2itcoinwor"d o+ten times it/s &ard to #nderstand. -&is week a v#"nera2i"itwas revea"ed in t&e Android operatin sstem t&at p#t a rea" +ear int&e 2itcoin comm#nit. L-B ost Andreas Amantonopo"is spoke wit&Andreas Peterson o+ t&e ce"i#m wa""et proect a2o#t e4act" w&at

&appened. B#t 2e+ore we et to t&at, Andreas, 0 &ad some 5#estions+or o#. First o++, in t&e interview t&at +o""ows, o# ta"k a "ot a2o#tentrop. $an o# e4p"ain to me w&at t&at is in sort o+ simp"e terms6

AA

'#re, Entrop is a meas#re o+ &ow m#c& in+ormation t&ere is in amessae. 0+ o# "ook at it t&e ot&er wa aro#nd &ow m#c&randomness t&ere is in a messae in comp#ter science terms. 0np&sics terms it/s essentia"" &ow m#c& disorder t&ere is in a sstem or

&ow m#c& ener in t&e +orm o+ &eat t&ere is in a sstem. B#t in t&ecase o+ in+ormation sstems rea"" o# can sa entrop is sain t&esame as randomness. 'o t&e pro2"em we/re disc#ssin in t&ispartic#"ar 2# is t&at somet&in t&at s&o#"d 2e random % t&at means its&o#"d &ave &i& entrop % is not random. 0t doesn/t &ave t&enecessar entrop. 0n +act, it/s a rat&er predicta2"e se5#ence.


52/101

AL

'o w&en we ta"k a2o#t randomness t&at can a"so 2e c&aracteri7ed asnoise compared to t&e sina", ri&t6

AA

1e"", e++ective" es. 0+ o# &ave a random stream, especia"" i+ it/s asec#re random n#m2er enerator w&ere o# e4pect it to &ave certainc&aracteristics o+ randomness t&en t&ere s&o#"d 2e no sina" % t&at/st&e de+inition. 'o ever 2it t&at comes o#t o+ t&at s&o#"d 2e noise %o# s&o#"d &ave no sina".

AL

'o it/s a"" noise t&en. 8k, so i+ it/s a"" noise, t&en is t&ere a di++erence2etween a "ot o+ noise in a sstem vers#s a "itt"e noise in a sstem6#st not necessari" ta"kin a2o#t random n#m2er enerators #st2road" speakin. 0+ o#/re trin to encrpt somet&in or sec#resomet&in, is it 2etter to &ave more randomness t&an "essrandomness6

AA

Yo# need a2so"#te randomness. Let me ive o# an e4amp"e. Let/ssa t&at t&ere/s a +#nction wit&in t&e sstem w&ere o#/re takin arandom n#m2er and o#/re m#"tip"in it wit& o#r secret ke. 'o +orsimp"icit sake, "et/s sa 0 &ave a secret ke and m secret ke is 3. 'oive me a random n#m2er 2etween 9 and ;.

AL

3

AA

Fantastic, so, 0/m oin to m#"tip" t&at 2 3 and 0/ve ot m diita"sinat#re. 'o i+ 0 ask o# in m ne4t transaction, ive me a n#m2er2etween 9 and ;.


53/101

AL

9 version ri&t now. 0t is sti"" a2eta. 0t is a m#"ti%2i""ion do""ar 2eta. And, w&at/s to stop some randomerror t&at no one &as seen #st wreckin t&e w&o"e t&in6


87/101

AL

8&, so we s&o#"d ta"k a2o#t t&at. 8n t&at note, so we &ad someconversation +rom some miners, 'tep&anie 0 know t&at o#

interviewed. 0 &ad some conversations o++ t&e record wit& some peop"ea2o#t t&is kind o+ 5#estion. 'peci+ica"" a2o#t, we ta"ked a2o#t 8PE$was it6

'

8E$

AL

8& &eck, o& &eck, t&at was it.

'

8rani7ation asin Power E4porters

AL

Yea&, t&at/s ri&t, so some peop"e didn/t #nderstand w&at we wereta"kin a2o#t. 0t was kind o+ a oke, 2eca#se, t&e o& &eck was kind o+ aoke. Beca#se in order +or t&at... in case o# &aven/t "istened to t&e"ast episode w&ere we ta"ked a2o#t t&is, 2asica"" GN$ miner re"easeda statement sain t&at t&e were oin to stop s&ippin A'0$ #nits+rom Novem2er t&ro#& 9 o+ =;9 wit& t&e idea 2ein t&at t&is wo#"dprotect t&e investment o+ t&e peop"e w&o &ave p#rc&ased e5#ipmentcomin 2e+ore 2eca#se in = t&e/re oin to re"ease, and t&e co#"din 9 2#t t&e/re onna &o"d it #nti" =... #m, are oin to re"ease&ardware t&at is orders o+ manit#de c&eaper and +aster t&an w&at

peop"e &ave previo#s" ordered. And so i+ t&e were to re"ease it att&e pace o+ tec&no"o t&en t&e peop"e w&o were ettin t&is minin&ardware wo#"d 2e a"most instant" o2so"eted and &ave no opport#nitto earn t&eir mone 2ack. And o+ co#rse t&at/s 2ad i+ o#/re a 2#sinesst&at tries to &ave c#stomers t&at 2# o#r prod#ct i+ o#/re iteratin so+ast wit& t&e tec&no"o t&at peop"e can/t even &ave a c&ance to make2ack t&eir investment.


88/101

A"t&o#& 0 wo#"d "ike to sa in t&is space t&at 0 persona"" t&ink t&at/s areat marketin pitc& +or t&eir compan 2#t t&at i+ o# "ook at w&at

&appened in t&e past wit& EFC o+ Ava"on. e &ad said &e "ook, we/ret&e market "eader #st 2eca#se 0 &ad no idea t&at ever sin"e ot&ercompan wo#"dn/t s&ip. 1&en o#/re ta"kin a2o#t &ow s#ccess+#"o#/re onna 2e at e4ec#tin in t&is space it/s a space t&at &as a "ot o+peop"e not e4ec#tin. 'o 0 #st t&ink t&at i+ t&e co#"d do w&at t&esa t&e/re onna do t&e s&o#"d #st do it. Beca#se e4ec#tin in t&isspace is so rare t&at 0 t&ink t&e market needs t&at more t&an it needssomeone 2ein it/s Batman. -&e protector it ma not need 2#t itneeds... it doesn/t know 2#t it wants.

AL

Yo# know 0 aree wit& o# t&ere, 2#t t&at/s t&e t&in. 1&en ta"kinwit& t&ese #s 0 spoke wit& t&e # 'am +rom.. was t&at &is name6

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'am.

AL

'am +rom GN$. And a"so t&ere were one or two ot&er A'0$man#+act#rers w&ose names 0 didn/t catc& in t&is "itt"e conversation wewere &avin. Yo# know t&at o#/re on

episode 33 - new york, new york!

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