 Hi everyone. Annyeonghaseyo. That's it. That's all I can say. It took me an hour to learn how to say that. I watched a lot of YouTube videos to learn how to say that. What I want to talk about today is one of the five pillars of cryptocurrencies. Very good. Thank you. That works. You've probably heard me say this, but I'm interested in blockchains that are open, public, borderless, neutral, and censorship-resistant. Have you heard that expression? Open, public, borderless, neutral, censorship-resistant. If you watched any of my videos, you probably heard me repeat that thing again, and again, and again, and again. There are the blockchains that are open, public, borderless, neutral, and censorship-resistant. Then there are the other kinds, which are bullshit. Very good. If you want more information on that, my most popular video on YouTube, which by the way is banned on Facebook, is called blockchains versus bullshit. Unfortunately, that word was apparently too colorful for Facebook. You can't say that word on Facebook. We only allow neo-Nazi content on Facebook. You can't say bullshit. Then there's that. How can you tell the difference between a blockchain and bullshit? There are a lot of companies that are trying to sell you things, and they attach the word blockchain in order to make their sale proposition more palatable. No matter what you're doing, they'll find a way to connect blockchain to it. My favorite example was Kodak. Do you remember Kodak? They used to make film. They invented the digital camera and then didn't use it or sell it for 20 years until Nokia destroyed their industry. In 2017, they launched a blockchain project. You can attach anything to blockchain. Let's try it. I say a word, and you say blockchain. Very good. Asparagus. If we keep doing this, people will start throwing money at you. Bus. Healthcare. Supply chain. It's very good. Already, we've created four startups that Google would probably fund. After all, this is called Google for startups this space, which is a funny name. I don't know what Google does with startups. Do they swallow them? Is that the idea? The idea here is that you need to be able to understand what's important and what's not important in this space. Because there's so much money flowing in this space, because there's so much opportunity, there are also a lot of sharks. In the business world, sharks can smell blood from kilometers away. In the business world, MBAs can smell VC money from kilometers away. If you put some VC money in the room, they're going to show up and start attaching the word blockchain to things. We need to understand what's important and what's not important in this space. How do we do that? I set up these ideas of what's important about the Bitcoin blockchain, why it all started with the Bitcoin blockchain, and what made it important, and how you can tell if something really needs a blockchain or doesn't. The characteristics of a blockchain are, in my opinion, open. It is public, borderless, neutral, and sensor-persistent. Let's talk about each one of those. Open means that anyone can access it, participate in it without authorization, without vetting, without anybody checking ID, national card, ethnic origin, or anything like that. Simply open. The funny thing about a blockchain is that you don't even need to be human to use a blockchain. That's not required. Software can use blockchains without proving anything. In fact, the blockchain doesn't know if you're human or a piece of software when you use it. Borderless, like the internet, there are no borders in this space. This is a truly international phenomenon. What that means is that it doesn't matter where you are, the blockchain is already there. It doesn't matter where you live, it doesn't matter where you travel. Sometimes I go through international airports, and by sometimes I mean every week. When I cross borders, they have these little signs on the border, and it says, if you are transporting more than ten thousand US dollars worth of currency, instruments, or convertible instruments, you must declare them. Which is an interesting question, because I have some bitcoin, but am I transferring anything? Am I transporting anything? Well, I have some keys, which are just numbers, and those are not the bitcoin. They are just my pin number. I look at the other travelers who are traveling next to me, and they are walking across the international border. They probably have a credit card or debit card in their pocket, and they are transporting that credit card number across the border. If you stop them and they say, are you moving money, they would say, no. But there is a credit card in your pocket, but the money is not on the credit card, it is in the bank. I just know the pin, so I am not transporting money. I thought that was a good approach. I am not transporting bitcoin, because my bitcoin is already in the country I am going to. Somebody downloaded it and put it there. When I arrived in Korea, my bitcoin was already here. I am just transporting my pin number. I don't want to have that conversation with an actual border official, because they may disagree about that analysis. I also try to make sure that if I have a wallet that has bitcoin when I am traveling, it has less than $10,000, so I don't really need to have that conversation. But it creates an interesting situation. You suddenly realize that all of our laws, practices, customs, and borders are based on a very simple idea. They are based on the idea that money is somewhere. It is either here or there, and if you take it from here and put it there, you are transporting. But what if it isn't here or there? What if it is everywhere? In that case, you are not transporting. Suddenly you have this really weird problem, which is that nobody who was writing that law could even think of money that was simply everywhere all the time. It didn't even occur to them. So none of that makes any sense anymore. What does it mean to transmit money when money isn't somewhere but everywhere? What does it mean to transmit money when money is simply a piece of information? For example, one of the demonstrations I did was I took a bitcoin transaction. I wrote a little script. I used Python. In Python, this was six lines of code. Using six lines of code, I took every byte in that transaction, and I replaced it with an emoji character from the Unicode set. The transaction starts with 0, 0, 0, 2, 0, 0, 3, f, blah, blah, blah, and hex. That became smiley face, frowny face, little rocket asparagus, broccoli, banana, monkey, all of the little emojis. Then I tweeted that. Did I transmit money? I don't know. I'm not quite sure if I transmitted money. I sent a bitcoin transaction as a tweet, consisting of monkey, banana, asparagus, broccoli, smiley face, frowny face, love heart. Is that money transmission? Do I need to have a banking license to do that? That would be very weird. But that's what bitcoin does. It creates these weird situations. Borderless. It means a lot more than you think of when you start realizing that money has become information that has no physical form, that has no physical presence, and does not exist in any place. It is not a thing of place, it is a thing of the mind. Okay. Neutral. What does neutral mean? If you operate a business and you want to transmit money across borders, you start having interesting conversations. Interesting conversations with your bankers. For example, I recently had my books translated into Russian, and I sold the rights to my books to a Russian publishing company, and the Russian publishing company sent me a small amount of money. It was maybe $500, something like that. It wasn't enough to buy a nuclear weapon. It's $500. So they sent me $500. Well, they tried to send me $500. It never arrived. And they said, I sent it. I'm like, okay, well, let me call my bank. So I called my bank and I said, where's the money? They said, we don't know. We don't have any money. I'm like, well, okay. So I went back to the Russian publisher and I asked them, and they sent me a receipt that showed that my bank had received it. And so I took that to the banker and I sent it to them and said, oh, our security department has stopped it. And they don't tell us. They don't tell you. They don't tell us. Don't you think it's important to tell the people who, you know, own this money that you're holding their money? No, we can't tell you because there's an investigation happening. Oh, like an investigation. This sounds exciting. Tell me more. So then they had some questions. Like, for example, who is sending you money? I said, my publisher in Russia. And why are they sending you money? Because I published a book. What is the title of the book? It's the Internet of Money Volume 1, you know, the Internet of Money. It's like, never mind. So, and who owns the publishing company? I'm like, I don't know. Have you confirmed that the publishing company is not owned by one of the 17 Russian oligarchs that are currently under sanctions by the State Department? I was like, no, it didn't really occur to me that in order to receive $500, I had to run their names against the terrorist watch list just in case. But now that I know that this is my patriotic duty, let us all check the database while singing USA, USA. And I'm sure we will find out. So I checked. The first name of the person who had sent me the money was Oleg. And they said, Oleg is a name that's listed on our list. I'm like, Oleg is like the fourth most common name in Russia. That's like me receiving money from someone in South America called Pablo. And then you're like, we have a Pablo on our list. I know, I've seen the Netflix show. I know you have a Pablo on your list, but this is the different Pablo. Pablo's a common name. And so then I had this conversation with my banker throughout this entire time I'm having this conversation. And I'm thinking, I've read this in a book. I've read this in a book. And I'm trying to remember who it was. Is this is this from George Orwell's 1984? Or is this from Kafka, the trial? Because this is crazy. This whole conversation is crazy. So long story short. Well, okay, long story long, because it's funny, seven months. It took me seven months to receive $500 from the highly suspicious Oleg for my book. Needless to say, the next time I did the deal with a publisher, I said, you're paying me in Bitcoin. Are we clear? Okay, what does neutral mean? Neutral means that it's my money. And at some very basic level, as someone who lives in a country that actually has the word free printed on everything, I would like to be able to say to the people of my bank, it's none of your fucking business why I'm receiving $500. It's my money. I can't say that. If I say that, they close all my bank accounts, and then I get a knock on the door, and then I have to go and explain to new people who Oleg is, and these people are less friendly because they're from the FBI. So anyway, neutral means that a system of money should not care who the sender or the recipient is, should not care what the purpose is, should only care about getting the transaction through. It's communication. It's communication about value. Now, this seems like a very radical idea, radical as in politically unfavorable, radical as in dangerous. What if people could give other people money without anybody knowing about it? I mean, that sounds like a pretty dangerous idea. Oh, no, wait. Actually, that's how the world worked for thousands of years. In fact, until the 1990s, that's how the world worked, right? People could give other people money. People can still give other people money. It's called cash, but even internationally, people could give other people money without anybody knowing what purpose it was for. What happened that was so bad that now we need to check everything? Because I'm pretty sure Oleg isn't the main source of funding for terrorism. At least I hope not, because I'd get in trouble. Censorship-resistant means that if somebody wants me to stop sending money, to stop giving money to someone, they can't. And the reason they can't stop me is because this is a system of speech, because money is communication, and because whether others believe that I have a human right to speak, a human right to associate, a human right to express myself, a human right to support the political causes, associations, or organizations that I choose to, is their problem. Because I have those human rights. I didn't ask for them. They weren't given to me or granted. I have them. There's a hint in the actual sentence. Human right starts with the most important qualifying word, which is how I got them, by being human. That's it. That's the requirement. All right. Any other humans here? You all have them. Great. Congratulations. So the idea here is that money as a system of communication is, like any system of communication, part of human rights. Now, there's a lot of governments who disagree with that idea. Right? There's a lot of governments who used to disagree with the idea of separating church and state. There's a lot of governments who used to disagree with the idea of people voting, especially women. They disagreed with that idea, too. There's a lot of governments that disagreed with a lot of ideas that we've now changed, because we know better. So maybe, hopefully, in 30 years, 40 years, 50 years, we will come to an understanding that there's a reason why we separate church and state. And for exactly the same reason, we should probably separate money and state. Because if money has a purpose of commerce and you turn it into a system of policing or a system of military control or a system of war, one of the things that happens is, it stops working as money. And that's a problem. Because if you start destroying your economy in order to do law enforcement, or you start destroying your economy in order to do war, what will be destroying your economy? So there's that. But there's a bigger problem. The problem is that if you give other people control over where you can and cannot spend money, those other people may decide that you shouldn't be spending money financing their political opposition, the other party, or anything else that you might be funding. And pretty soon, that kind of power turns into corruption. Turns out, that's why we separated church and state in most civilized countries. Because they corrupt each other. And if you take the banks and the government, and you bring them a bit too close together, they start getting very corrupt, very, very corrupt, right? The banks corrupt the government, the government corrupts the banks, and then they all destroy the economy together. So out of these crazy radical ideas, we call them the ideas of the Enlightenment, classical liberalism, human rights, ideas like this, came this crazy idea that we could do it with money. And we now have this system that is open, borderless, neutral, censorship-resistant, and public. Public is the idea that everything you do is verifiable on the network by everybody else, which means no one can cheat, because you can run software that can tell you definitively if a transaction has happened or not. So with these principles, we've built a new system of money. Now the question is, what happens next? Who needs this? Who uses this? How will it develop? Will governments allow it to happen? Will governments try to stop it? And it happens anyway, because they can't stop it. We don't know the answers to those questions. What we do know is, for the first time in history, we now have these capabilities. And now we've taken them a bit further. It's not just money. With technologies like smart contracts that are in systems like Ethereum that I'm interested in and wrote a book about, these concepts now extend to more complicated, some would say more sophisticated, systems that allow you to do other things like, for example, build corporations, corporations that are not registered by the state, or domiciled in a specific location, but operate as independent entities on the blockchain. We call these decentralized autonomous organizations, or DAOs, which is a stupid name. Because anybody who hears that name goes, what? It doesn't really tell you what this thing is. It's kind of like a cross between an association like this meetup, a corporation like any company you know. I believe here you call them table. Is that what they're called? Table? Yes, I can't pronounce it. But I know what it is. So any range from your local neighborhood association all the way to the most powerful company slash family that exists in your country, you can express any of those things as a network-based entity that exists outside of borders. Again, what if we take a company and make that company open, borderless, public, neutral, censorship-resistant? Interesting things could happen. Interesting things are happening. And I want to focus a bit more on the idea of open. Most people misunderstand what that means. There's one layer of open. One layer of open is the idea that anyone can participate in any way they want simply by downloading the software. Okay, that's layer one. We understand what that means. But there's another more interesting thing that happens. You see, we're not operating these blockchain things in isolation. We're operating them in competition against existing financial services and systems. How many here use PayPal or Venmo? Okay, only one Venmo? Two. Kakao Pay. Very good. How many people here use? I can't use Kakao Pay. I tried to. It wants me to have a Korean phone number. So instead, I have to pay my taxis with a credit card. So anyway, Kakao Pay. How many people use Kakao Pay? Great. So those systems are not open. But they're not open for two reasons. One is they're not open in terms of I care have an account on Kakao Pay, because I don't have a Korean mobile phone number. So that's one example of not being open. In order to use the system, I have to be authorized with something. An ID card, phone number, something. I can't just download the software and operate on the network. But there's another much more interesting aspect of open. How many of you here write apps? Excellent. And how many of you here have written an app that runs on top of Kakao Pay? Oh, you can't. Why not? So you can't write an app that uses PayPal as a library, as a protocol, as a network, as a platform. You can connect to it so that it does the payments, but you can't extend it. You can't modify it. You can't build something different. And you certainly can't build something unauthorized, right? So I can't go out and build an application that does Kakao Pay, but for people who don't have Korean phone numbers. Why not? And that's where the second aspect of open really comes in. And you might think this is a small thing. Obviously, it's their network. Why would they allow me to go on to their network and start writing applications that change the purpose of the network? But now think about it a different way. That means that all of the new things have to come from them. If I come up with a great idea, I can't do it. If I want to do it, I have to build a complete payments network, just to run my idea on top of it. I can't just simply run it on top of theirs. Their system is closed in a very different way. It only allows innovation from the inside. And they think that's a good thing. And I think that's a great thing, because that's how we're going to win. Because you see, the really interesting thing about open blockchains is that any one of you can write an application on top of it. And not only can you write an application on top of it, you can write an application that changes the way the system works, that does something that nobody authorized. In fact, you can write something that does something very, very illegal, or very, very different, or very, very weird. And no one can stop you, because this is a type of radical openness, where it's not simply the fact that you have been allowed to access the platform, it is the opposite. You cannot be stopped from accessing the platform. It's not just open, it is unclosable. Does that make any sense? This is a really radical idea, and what it does is, it means you can write an application connected to this network, and make it do things nobody had considered before, and you don't need to have too many users. You only need to find one other person who wants to run that application, and between the two of you, you can run that application. So you have innovation for a market of one or two. And then you can do something even more radical. You can take your application and make it open. And now somebody who is building something else can build it on top of the blockchain, or on top of your application, or both, and then they can make their application open, and then somebody else comes along and makes their application open. And now everybody is building on top of everybody else's idea, without asking for anyone's permission. And what happens then is really astonishing, because we've seen it once before. This is the internet. This is what happened with the internet. What happened with the internet wasn't that we had some great companies that made some great platforms. What happened with the internet was that you didn't need anybody's permission to launch an application. And so you could launch one, and then let other people use it to launch another, and another, and another. And it created this tsunami of innovation that completely overwhelmed all of the possible competitors, so they couldn't compete, and this is going to happen to banking. They cannot compete against that, because there's no way you can do inside a company the amount of innovation of the entire world put together, all operating to serve their own special purpose without asking for anybody's permission. This is a really important point, and it's the reason why people don't understand at first the difference between PayPal, Venmo, Kakao Pay, and Bitcoin. They're like, so it's an app on your phone, and you can read a QR code and make a payment. So what? I've been able to do that with PayPal since 1995. So what? And that's where they're missing the point. It's not an app. It's a platform. It's an open platform, a radically open, borderless, public, neutral, censorship-persistent platform. Thank you.