 Government is not a monolithic thing, which is your enemy. It's a multitudinous thing, which is your enemy. Our dream was to enable the future of human freedom. In the early 1990s, a group of mathematicians, misfits, hackers, and hobbyists came together around a shared belief that the internet would either demolish artificial walls or lay the groundwork for an Orwellian state. We can prevent the Ministry of Truth. They saw a branch of mathematics called cryptography as a weapon against central planning and surveillance in this new virtual world. And what is a cypherpunk? Cypherpunks are cryptography activists. The more I realized how it was a really pivotal technology for society. The National Security Agency declared the unrestrained public discussion of cryptographic research threatened our national security. I saw this as the critical fork in the road for the future of human freedom. Coming up, reason presents a four-part series and a movement that foresaw both the promise and the peril that lay ahead when the internet upended the world. It's like standing on top of the mountain and seeing that this is out there. You people who are here can say, okay, what kind of world do we really want to build and build it? Imagine, if you will, sitting down to your morning coffee, turning on your home computer to read the day's newspaper. Well, it's not as far-fetched as it may seem. The freedom issues were very important to us. This is a sample of what you can order through your computer. It combines the power of your computer with the convenience of your telephone. We saw that information technology could create a 1984-style tyrannical top-down control society. Or it could develop into something that is a decentralized enabler of human freedom. And even back then, our dream was to enable the future of human freedom. In the late 1980s, at the dawn of the online age, a group of young computer scientists in Silicon Valley started grappling with what this new technology would mean for society. We took a look at the potential of computer systems and saw that for everything about civilization that enables it to work, we can enable it to work much better. The most influential figure in what would become the cipherpunk movement was the physicist Tim May, who envisioned the future internet as a place for what he would dub crypto-anarchy, where lawbreakers' radicals and political dissidents could shield their activities from government surveillance and control. People doing things that didn't require permissions from anyone because the people were untraceable and couldn't be stopped. But there was another group that saw the potential of computers to remake society gradually from within by decentralizing commerce and improving the dissemination of knowledge. They were dubbed the high-tech Hayekians because their world view was influenced by the work of Austrian economist Friedrich Hayek. The fundamental insights of Hayekian economics was how separately formulated plans tend to mesh well. And we saw electronic media as an enabler of coordination, the complexity that the world previously was really not capable of. The clash of visions between the high-tech Hayekians who wanted to build a borderless, frictionless global marketplace and the crypto-anarchists who saw the internet as a technological means of undermining all governments set the course for the cipherpunk movement. If May was the father of crypto-anarchy, the central figure for the high-tech Hayekians was the economist and entrepreneur Phil Salem. Now if you own a personal computer, we are told you can shop at home in what's called the electronic mall. It was a few years before the invention of the worldwide web, but computer companies were offering a new type of service in which customers could connect through their phone lines to post messages to a bulletin board, check their horoscopes, or go shopping. You can buy items from department stores ranging from Nordstroms to Neiman Marcus, all via computer screen. Salem, whose outlook was shaped by his careful reading of Hayek, understood that these services weren't merely a curiosity or a digital version of the old mail order catalog. They were the beginning of something that had the potential to one day erase national boundaries through trade and undermine government power. In a prescient 1991 essay, he foresaw how the internet would change the world by 1995, 2000 and beyond. The static role of store and shopper, seller and buyer, author and reader, systems defined by their one-way information flows will be replaced by new forms of media, enabling two-way information flows. Before getting involved with computers, Salem had run a private rocket company and had co-authored a congressional study critical of NASA's wasteful spending. But in his view, there was continuity between his interest in space travel and computing because in both industries, technology's purpose was to drive down the transaction costs that impede human activity, making it feasible to explore new frontiers and interact in ways that would otherwise be prohibitively expensive. Now, thanks to breakthroughs in computing, the ability to buy or obtain exactly the information you need when you want it and the form you want it is about to explode at a speed unmatched since the invention of printing. But Salem was foremost an entrepreneur, and in the mid-1980s he set out to launch one of those platforms for buying and selling information. He called it the American Information Exchange, or AMEX. This business that we're doing is to make possible a new kind of thing, which is being able to buy and sell information online. AMEX was a radical idea in the mid-1980s. Users could buy or sell advice about the real estate market, writing software, or what companies to invest in. Now you can say to somebody, so it's like eBay or like price line or like Amazon, when we try to explain this to people, they simply couldn't get it. They could not wrap their heads around this. Some of them, I think, couldn't imagine the computational end of it. Milton Friedman didn't get it. Though it was similar in ways to the online marketplaces that would launch a decade later, AMEX was more than just an idea before its time. What set it apart was its grounding in political philosophy and its lofty goal of elevating individual decision-making over central planning. It was an instantiation of Austrian economics now put into code and put online. Something like this could have profound human consequences, and that was the vision. A fluid, transaction-oriented market system with two-way feedback, Salem wrote, would result in crowding out monolithic, mostly government bureaucracies. We were laying the philosophical foundations of what is e-commerce that you can now have creative explosion. It's going to change the world. Yes, that's right. Intermediating among large populations of human beings through electronic means results in all kinds of fascinating, emergent and social behavior. AMEX's chief architect was the pioneering software engineer, Chip Morningstar, who had come from a stint at George Lucas' production studio, where he oversaw the creation of Habitat, which was one of the first online virtual communities. After joining AMEX, Morningstar co-authored an essay, which argued that in building a world in software, detailed central planning is impossible. The world is just more complicated. People are more complicated. You cannot know what all their goals are. What you can do is you can put them into an environment in which certain kinds of things are possible. What you can't do is tell people what they want. Phil Salem, Mark Miller and Chip Morningstar's ideas about how a future internet could decentralize society inspired Tim May to first articulate a radically different vision. May, who would go on to become the most influential figure in the cypherpunk movement, was introduced to Salem by Morningstar in December of 1987. Chip said, there's this guy out in Santa Cruz that you ought to talk to. As a scientist at Intel, May had solved an issue affecting the reliability of a company's memory chips called the alpha particle problem. Rich on stock options, he'd been spending his days at the beach reading science fiction novels, thinking about how networked personal computers could turn some of their futuristic scenarios into reality. So I met with Phil in Redwood City and he described how AMEX would work. And I said, people aren't going to be selling meaningless stuff like surfboard recommendations. In May's view, AMEX could be useful as a tool for undermining state power, but only by shattering legal and social norms. I said it's going to be corporate information. It's going to be bomber plans for the B1 bomber. Who wants to buy that competitor or company? Who wants to sell that to someone who has access to that information? It's two different types of libertarians. He didn't understand the extent to which you could benefit the world by lowering transaction costs for everybody. Like Salem and the high tech hyacians, May saw the personal computer as enabling technology for sweeping societal changes. But he had a different vision of a virtual marketplace for any and all goods and services, which he dubbed blacknet, or a technological means of undermining all governments. On AMEX, user activity was out in the open, but blacknet would be impervious to government tracking and surveillance, and perhaps it would be a network with no owners at all. Many people's first response would be to say that blacknet won't be allowed to happen. Perhaps, but technology would probably make it inevitable. If you don't physically meet the person, if you don't even know what continent they're on, you can't coerce them. Tim May's a smart guy. He was great for honing our ideas and technologies against, but I think of him as sort of the shock jock for cipher punks. I want to live in the world that surrounds us rather than try and construct one from scratch. We saw this as emerging from inside the world and carrying the world along with it. In 1988, AMEX was acquired by the software giant Autodesk, a growing scene of young technologists came together around Salem and the high tech hyacians, all working towards a common vision of enhancing human freedom through networked personal computing. It was this hot house of ideas from which a world view was brilliant. Salem died of cancer in 1991, the same year that the World Wide Web became publicly available. But his intellectual contributions and conflict with May had laid the groundwork for what would come next for the cipher punks. The long effort to build a self sovereign and anonymous form of digital money and the embrace of a branch of mathematics called cryptography, which they came to view as the key to personal liberation on the internet. The title of the book is the rise of the computer state. What I'm saying is that large bureaucracies with the power that the computer gives them become more powerful and that they are escaping the checks and balances of representative democracy. In 1983, the New York Times reporter David Burnham warned that the integration of computers into every aspect of daily life could lead to a level of automated surveillance unknown in any previous age. For society to change course, Burnham argued, citizens would need to rise up through the democratic process and demand new legal protections to safeguard their privacy. There are ways to deal with it. We have done it and all I hope is that we're on our toes enough and alert enough to see them and go after them. This is just political jaw boning. A few years later, a physicist named Tim May argued that putting faith in representative democracy was naive. He believed that only innovation could save us from the Orwellian state. The interesting things that had happened had been technological changes, the telephone, the copy machine, the VCR, computers. May became a co-founder of the cypherpunk movement, which came together around the idea that a recent breakthrough in the field of cryptography was the key innovation for combating tyranny, comparable to how the crossbow enabled individuals to go up against medieval armies. It's an epiphany. It's like standing on top of the mountain and seeing that this is out there. Coming up, Reason takes a look at how one community came to see cryptography as a powerful weapon for defeating Big Brother. Here's part two in a four-part series on how the cypherpunk movement anticipated the promise and the peril that lay ahead when the internet upended the world. In the late 1970s, there was an astonishing breakthrough in the field of cryptography. I saw this as the critical fork in the road for the future of human freedom. I really did. In the summer of 77, Mark Miller was a 20-year-old student at Yale, working for a counter-cultural tech visionary named Ted Nelson. Like many future cypherpunks, he would learn of this groundbreaking discovery when the August issue of Scientific American arrived at his door. I'm reading Martin Gardner's Mathematical Games column, and I just get incredibly excited. Just incredibly excited. I call up Ted in the middle of the night, and I tell Ted, we can prevent the Ministry of Truth. As Gardner told his readers, a discovery had been made that would revolutionize the entire field of secret communication. It was the work of teams of mathematicians and computer scientists at MIT and Stanford, including a young researcher named Whitfield Diffie. If you look at 1791 at the moment of the Bill of Rights, impenetrably private conversations dominated. What the Framers didn't foresee is that private communication would happen via computers sending messages across the world that could easily be intercepted. Public key cryptography gives you a mechanism whereby you can recover this ability to have an impenetrably private conversation between two people. Look at this. A cypher. Well, let's go back to the office and get started on it. Sending a secret message used to involve translating words through a secret code that spies and government agents could potentially crack. Phil, I think I've got it. Good. Z is D. V is E. Anyone sending and receiving messages also had to have a copy of the secret key or translation device, just like the decipher rings collected by American schoolchildren, starting in the 1930s. Here's how you can get one for your very own. First, get a jar of chocolate flavored oval tea. Public key cryptography made decoding devices unnecessary, and figuring out the pattern effectively impossible. The big breakthrough was an easy to solve mathematical formula that you could funnel words into just as easily as dropping them through a trapped door. But if you flipped the problem around and tried to pull the message out the other side, in that direction the formula was almost impossible to solve, such that even a supercomputer trying random numbers would need 40 quadrillion years to service the answer. But the person who set up the mathematical formula, or trapped door, held the answer to the problem or secret code, making it possible for that person to retrieve the original message. It could also be compared to the most ubiquitous trapped door system for sending messages. Consider a mailbox. Anyone can throw a letter in a mailbox, but only the mailman who has a key can take it out. Anyone in the world could set up one of these equations, serving as the mailman of his or her very own impenetrable virtual letterbox. And because that individual could prove ownership of the mailbox by opening it with the only known key, public key cryptography also made it possible to set up a provable identity on the internet, completely disconnected from any real-world personal information. Knowing economically what you're doing, looking at what's happening with the internet, what can you see happening way out there in the future? The most striking non-obvious thing is that current technologies are in the process of giving us a level of privacy we have never had before. Essentially, there are now well-known ways, available in free software, of encrypting messages so that only the intended recipient can read them, so that if the FBI intercepts them, it's gibberish to them. One way of reading the Second Amendment is that it was a way of making sure that if the government tried to suppress the people, the people would win. And the militia wouldn't be very good, but it would outnumber the professionals 100 to 1. In the modern world, the weapons that the Army has differed by a lot more than they did in the 18th century. But I also think that if you look at what politics are like nowadays, the real wars between the government and the population are information wars, not physical wars. Encryption means that they can't arrest you, they can't blackmail your key people, they can't do any of the things governments might do to make sure that public information is what they wanted. Meanwhile, the US intelligence community was doing everything in its power to keep this new tool out of the hands of the public. Well, somebody once said to me, if you think new directions had an impact on the outside world, you should have seen the impact it had on NSA. In Part 3 in this series, we'll look at the US government's effort to halt the widespread use of public key cryptography by threatening criminal prosecution and the legal and public relations battle waged by one founding member of the cypherpunks for freedom of speech and software. A hurricane of unrestrained joy sweeps through every part of the war sick world. The breaking of encryption was essential to the war effort. England would probably have fallen if they'd not been able to read the enigma messages because every time the Germans sent bombers, the RAF knew where they were sending them and could mask the planes there to defend. If any significant fraction of those attacks had gotten through, England would have been much more helpless, may well have fallen in the course of World War II, may have changed. And that is the origin of the regulations that said this is ammunition, this is an item of war. And the problem was they didn't really take freedom of speech, freedom of inquiry, academic freedom into account in that. But on the matter of encryption, we have a very fine proposal to protect the security and the national security. Me, when I have to save somebody's life to go in and get vital information, I think that's the same choice we had. Coming up, the story of the US government's long battle to keep strong encryption out of the hands of its citizens and how First Amendment activists fought back. Here's part three in a four-part series on how the cypherpunk movement of the 1990s anticipated the promise and the peril that lay ahead when the internet upended the world. In 1977, researchers at MIT made an astonishing discovery, a mathematical system for encrypting secret messages so powerful that it had the potential to make government spying effectively impossible. But before these mathematicians could publish their research, the NSA made it clear that doing so could land them in federal prison. The US government considered these mathematical systems modern weapons technologies and distributing them was a crime under the international traffic and arms regulations. MIT halted plans to distribute the paper. I decided quite literally they are going to classify this over my dead body. Mark Miller was a 20-year-old student at Yale who had read about this discovery in Scientific American. So I traveled to MIT, managed to get my hand on a paper copy of this thing. I went to a variety of different copy shops, so I wasn't making lots of copies in any one place. I sent them to home and hobbyist computer organizations and magazines all across the country. And I gave copies of the paper to some select friends of mine and I told them, if I disappear, make sure this gets out. Early in 1978, the US federal government backed off and decided to allow the publication and the world has been on a different course ever since it got published. But the crypto wars were just getting started. In the 1970s, the National Security Agency declared the unrestrained public discussion of cryptographic research threatened our national security. The private cryptography community and the government have been sparring over the issue ever since. Marshall McLuhan said that one day we would all live in a global village. Well, the global village has arrived and its main street is called the Internet. The Internet also created an electronic surveillance apparatus that was like nothing the world had ever seen, which meant that the cryptography breakthroughs of the 1970s were no longer a rarefied topic. They were privacy salvation. Internet users could shield their online activities from spying. And that sent the intelligence community once again scrambling to stop the dissemination of this powerful tool. In 1991, a software developer named Phil Zimmerman released the first relatively easy to use secret messaging system. Built with strong encryption, which was called PGP. Somehow it got overseas. Now that it's over there, people are using it. And I'm delighted to hear good stories about how it's used in places where there are oppressive governments. So the US Justice Department launched a three-year criminal investigation of Zimmerman. On the grounds that by making his software accessible outside the country, he could be guilty of exporting weapons under the Arms Control Act. Meanwhile, the National Security Agency argued that Zimmerman's software would be used by child molesters and criminals. PGP, they say, is out there to protect freedom fighters in Latvia, said the NSA's general counsel. But the fact is, the only use that has come to the attention of law enforcement agencies is a guy who was using PGP so the police could not tell what little boys he had seduced over the net. Child pornographers, terrorists, money wanderers, take your pick. These are the people who will be invoked as the bringers of death and destruction. Well, it's true. It's true. It's true. So they're right. Yes. But all technologies have had bad effects. The telephones allow extortion, death threats, bomb threats, kidnapping cases. Uncontrolled publishing of books could allow satanic books to appear. The Cypherpunks argued that PGP was like any other published material because under the hood it was just a series of instructions to be carried out by a machine. Restraint on freedom of expression of software writers is anathema in a free society. And a violation of the First Amendment wrote the economist and entrepreneur Phil Salem in a 1991 essay titled Freedom of Speech and Software. Encryption can't be controlled whether or not it's powerful or has impacts on the government because it's free speech. In the early 90s, John Gilmore, who was a co-founder of the Cypherpunk movement, risked going to jail in his campaign to force the government to acknowledge that regulating encryption violated the First Amendment. We basically had a community of a thousand people scattered around who were all trying different ideas on how to get around the government to get encryption to the masses. What we're afraid of several years from now is the terrorists both hit their encryption button on the telephone and even though we have access, we can't understand what they're saying on a real-time basis. The Clinton administration told Congress that Americans have no constitutional right to choose their own method of encryption and push for legislation that would require companies to build in a mechanism for law enforcement agencies to break in. We're in favor of strong encryption, robust encryption. We just want to make sure we have a trap door and a key under some judge's authority where we can get there if somebody's planning a crime. The Cypherpunks looked for ways to undercut the government's case by pointing out the similarities between encryption software and other forms of protected speech with Phil Zimmerman under federal investigation for making his software available for download outside the U.S. To prove a point, he convinced MIT Press to mirror his action in the analog world by printing out the PGP source code, adding a binding and shipping it to European bookstores. The government knew if they went to court to suppress the publication of a book from a university that they would lose and they would lose in a hurry. There were people who actually got encryption code tattooed on their bodies and then started asking, can I go to a foreign country? We printed up t-shirts that had encryption code on them and submitted them to the government office of munitions control. Can we publish this t-shirt? Apparently they never answered that query because they realized to say no would be to invite a lawsuit they would lose and so the best answer was no answer at all. Can we talk a little bit more about encryption technology? No, no. Thank you. I hesitated even to use the word, but I'm not using it any more right. In 1996 the Justice Department announced that it wouldn't pursue criminal charges against Phil Zimmerman and major court victories came when two federal judges found that encryption is protected by the First Amendment. The crypto wars are still ongoing. What we won in the first round was the right to publish it and the right to put it in mass market software but what we didn't actually do is deploy it in mass market software. Now there are major companies building serious encryption into their products and we're getting a lot of pushback from the government about this. It's not about the rule of law, but we don't want to create spaces that are beyond the reach of the law in the United States, right? It's not just the reprehensible behavior of sexual predation on children but myriad additional forms of serious crime enabled by end-to-end encryption. I'm not optimistic that privacy will prevail in the crypto wars. It's an ongoing struggle. In the early 90s at the same time that Gilmore was fighting his legal battle for freedom of speech and software the cypherpunks were exploring cryptography's potential in the context of collapsing political borders and the rise of liberal democracy. Part four in this series will look at how those dreams turn to disillusionment, the death of the cypherpunk movement and its rebirth following the invention of Bitcoin. You're looking at this and going, wow wouldn't it be amazing if this worked? And then you realize, oh my gosh it does work. National borders are just speed bumps in the information superhighway. Cryptography is really, really strong. We can do whatever we want here. People might provide the equivalent of what government does in a decentralized fashion. I talk about collapse of governments. I think we actually saw that in the Middle Ages probably as a result of the printing press. This is the story of a community of scientists, mathematicians, philosophers and activists who believe that the internet combined with recent breakthroughs in the field of cryptography would upend society and usher in a new era of sovereign individualism. We have it in our power to begin the world over again right now. And it's internal clash over the optimal path to achieving that goal. Can evil be done with this technology? Yes. And so what? So then deal with it. Here's the final installment in a four-part series on the origins of the cypherpunk movement and how it helped shape our modern world. We see a free world that has achieved a level of prosperity unprecedented in all human history. Mr. Gorbachev, tear down this wall. If you had asked me ten years ago, is it possible that communism could collapse in a mighty year, 1992, like I said, absolutely ridiculous? Fall of the Berlin Wall was important to me because I thought it was the end of history and that national borders would cease being the walls of prisons. And so a couple years later, when I discovered the internet, I thought, oh, this is part of this pattern where borders and distance stop being barriers to people. Then I discovered a whole clan of people who self-identified as computer people. Found my tribe. And among that clan was the cypherpunks mailing list. If you want to subscribe to our mailing list, send a blank email message and just say subscribe cypherpunks. And what is a cypherpunk? What do you guys stand for? Cypherpunks are cryptography activists. The Cypherpunks email list, which started in the fall of 1992, one year after the launch of the World Wide Web, became a gathering place for a global community interested in using cryptography to allow individuals to communicate and transact on the internet privately and without interference from the central authority. In the last 20 years, the basic techniques to do all sorts of impossible seeming things have suddenly emerged, put them into practice. Many cypherpunks were inspired by the work of the computer scientist David Chong, who had demonstrated that it was possible to use cryptography to build an anonymous payment network that ran on the internet. Because of the cypherpunks and because of the science papers of David Chong, I thought the third thing that's going to happen is economic freedom, that people are going to be no longer constrained by national borders and distance from cooperating and sharing resources and helping each other. But at this watershed moment of collapsing borders, we divide within the cypherpunk community over whether these cryptographic tools would lead to more individual freedom, free trade and the spread of democracy, or the end of government altogether. The cypherpunk movement's most influential figure was the physicist and intellectual provocateur Tim May, who coined the phrase crypto-anarchy. He saw the fall of the Berlin Wall as evidence that the societal institutions we take for granted could collapse in short order, just as they had in the Middle Ages. We saw the little principalities, the monarchies, the religious, the papal states. We saw those collapse, probably as a result of publishing, printing. May penned a one-page summary of how cryptography would upend society. So I just sat down at my little Macintosh and loosely patterned this after the Communist Manifesto. A specter is haunting the modern world, the specter of crypto-anarchy. Cryptography is really, really strong. We can be protected from anything without, from the observers, from the watchers, from the imposers of the past upon the future we're trying to create. May was skeptical of the idea that humanity was witnessing an unabashed victory of economic and political liberalism, or that it was possible to overcome tyranny through collective action, as the political scientist Francis Fukuyama argued. We as human beings want to be recognized with a certain dignity. This is the essential driving force behind democratic revolutions, whether they take place in Eastern Europe or in Asia or in Latin America. May embraced a technology-based theory of historic change, summed up by the movement's tagline, which was coined by the mathematician Eric Hughes, Cypherpunk's Right Code. What Eric meant by Cypherpunk's Right Code is, don't be one of those guys who goes to a libertarian party conference and sits about getting somebody elected to the Los Gatos City Council. That way lies madness. Whereas the interesting things that had happened had been technological changes, the telephone, the copy machine, the VCR. The philosophy that I really got interested in is that you don't just go and ask the regulator, oh we need more privacy online. You go fix it. Arguing and complaining and lobbying and politics have nominal effects on what changes the world is, technology adoption and society moving, shifting speed points. For crypto-anarchists like May, Writing Code meant building systems for anonymous transactions on the internet that made the arbitrary divisions of the political world irrelevant. National borders are just speed bumps on the information superhighway. Online cryptographic networks would be structured like a geodesic dome, a form hailed by the counter-cultural technologists of the 1970s for being in harmony with nature and highly resistant to external attack. Networks with no owners, with many interconnecting nodes that would be basically unstoppable. In a geodesic market, economics will no longer be the handmaiden of politics. The cyberpunk writer Robert Hettinger noted, and nation states will eventually be as ceremonial as modern-day constitutional monarchs. This idea of a many-to-many connection was clearly going to happen. But it was much easier to build a functional network for cooperation and trade when you can rely on a central authority to enforce the rules. How can we use this weird crypto-technique to solve this strange esoteric little problem that in the real world you just solve because, oh, I know what your social security number is, or you have to have your government-issued ID that you take into the bank so that you can open up your bank account and they can link the two together and say, if Jim McCoy walks out on this $100,000 loan, well, we know where to find him. I was trying to deal with those problems. You can buy and sell property in cyberspace using cryptographic protocols. The idea of ways in which people might provide the equivalent of what government does in a decentralized fashion. Tim stole some ideas from my machinery of freedom, and he reprocessed them with all this technological government, and then I stole them back. A function of government that was particularly hard to replicate using cryptography was the issuance of money. The cypherpunks attempted to build a borderless internet currency system as anonymous as cash and that, like gold, held its value without the backing of a central bank. Gold makes very good money because nobody can manufacture more of it very readily, but mildly, whereas bits are perfectly copyable. So turning bits into good money is quite difficult. Tim May and many others considered electronic cash to be the holy grail because it completed the picture. A private and decentralized monetary system, may argue, was a key component in constructing a new borderless world where the activities and assets of individuals would be resistant to government control and confiscation. You don't physically meet the person if you don't even know what continent they're on. You can't coerce them. But there was another faction within the movement that rejected Tim May's vision of cordoning off a new world in cyberspace. The high tech hyacinims were people like Eric Drexler, Mark Miller, Phil Salem. They were focused on designing secure computing systems based on economic insights, particularly those of the Austrian-born Nobel Prize winner Friedrich Hayek. Instead of building a new virtual world shielded from government interference, the high tech hyacinims sought to use technology to demolish walls and divisions within the existing world. They imagined that introducing new tools for human coordination would gradually erode the government's ability to impinge on our freedoms. We did lots and lots of fantasizing about how the world could be different, but we saw this as emerging from inside the world. Cryptography was a tool for porting economic concepts and legal strictures on the internet. But the aim was to foster new forms of peer-to-peer commerce and knowledge sharing. And the high tech hyacinims believed that even imperfect systems can transform society gradually from within. The overall arc of world history is towards rule of law, towards less corruptible systems. If the emergence of the world of crypto-commerce creates systems that are vastly less corruptible but under a whole mix of different mechanisms and governance regimes such that they're not always everywhere uncorruptible, I think that's fine. There's a lot of power in providing people tools such that they can successfully start to act more like you would like them to. As opposed to you've got to come over here where it's really hard-edged encrypted and it works exactly the way we want. Let's raise people's levels incrementally and that's an improvement in the world. For many cypherpunks, the darker side of crypto-anarchy was epitomized by the writings of a chemist and electrical engineer Jim Bell, a participant on the email list who in the mid-90s compared aggression by the state to that of muggers, rapists, robbers and murderers and posited a cryptographically protected marketplace in which anonymous individuals could in effect pay to have government employees killed with the goal of destroying the state. In 1997 Bell was arrested and went to prison for among other things dropping a stink bomb on a government building. Tim May distanced himself from Bell's writings and activities while maintaining that marketplaces for assassination like the one Bell had described might be both inevitable and desirable. Can evil be done with this technology not just the internet, but especially the crypto part of it? Yes. And so what? Deal with it. Zimmerman once told me that he sometimes regretted ever introducing PGP to the world because it could be used by Al Qaeda or the Taliban or whatnot. I say so what? I'm not morally responsible. Would it happen whether we had existed or not? Because technology has its own logic. And people want to do what they want to do. They want free shit. They want freedom to do things. Even if they say they should be regulated they'll often make the conscious decision to copy music, copy videotapes they want to see. Black net is a negative consequence. I'm not interested in creating that. When you build technology to solve problems then there are consequences that we try to think ahead of and look at and figure out how we might address and get ahead of the downsides of what we build and that's responsible development. And we certainly engage in that and talking with Tim May and putting on that, what if I was a black cat kind of thing was certainly a useful foil for working through those kinds of ideas but that's absolutely not what cypher punks were. The progress of the spread of democracy if you take a sufficiently long-term view of it has been really, you know, quite remarkable. Our dream was to enable the future of human freedom and we had this bizarre confidence about how the future would unfold and to, you know, using Alan Kay's famous phrase to have a huge hand in inventing it but the road had a lot more weeds and detours than we could have anticipated. When we first launched we were hoping for, you know, maybe 400, 500 people. Now we're at 100,000 people, so who knows where we're going next? Using the ever-growing storage capacity of servers belonging to companies like Google and IBM. Instead of it being on your server under your desk that stuff is being taken care of for you. The professionals keep track of all the programs and the data. Who doesn't want a simpler life? I find this way of working more simple. You collect half a gigabyte of information on your customers. What do you do with that information? They want to know everything about you so they can sell you stuff and it results in you each getting a digital proctology exam. The NSA specifically targets the communications of everyone. Over the next quarter century the internet would make possible an explosion of individual freedom and information sharing just as Phil Salem had predicted in 1991 but it would also grow into a surveillance apparatus that bore out the dystopian vision of journalist David Burnham in his 1983 book The Rise of the Computer State. Large bureaucracies with the power that the computer gives them become more powerful and they are escaping the checks and balances of representative democracy. Facebook collects information that the East German Stasi would have killed for. I think that most people are quite happy to hand people all of the information about them online in return for a few picks of your high school friends, kids or whatever. By the mid-2000s it seemed the cypherpunk movement had mostly failed. Then came a global financial crisis followed by massive bailouts by central banks. On October 31, 2008 a pseudonymous inventor named Satoshi Nakamoto shared a white paper describing a new peer-to-peer non-governmental monetary system pulling together technical and philosophical concepts developed on the cypherpunk's email list. Within a few years the movement was reborn with a new generation committed to enhancing personal freedom and privacy with cryptographic tools. It's like discovering an oasis when you're lost in the desert. It's Bitcoin that's single-handedly responsible for the current wave of cypherpunk activity. It's always messier than visionaries can anticipate because reality is bigger than anyone had. We're still on the road in the quest to build architectures that amplify human freedoms and protect us from the dynamics in the other direction.