 Hey, folks! Adam Rulavine here. After quite a lot of work, earlier this week we signed a new syndication agreement for speaking of Bitcoin. That'll see our audience expand without giving up the independence, control, and self-reliance that we've worked so hard to maintain. As of next week, we'll be releasing new episodes on CoinDesk as well as through our private channels, which should eventually result in more frequent new content for you. But for this week, I'd like to share with you one of my favorite episodes from a short-lived series that our earliest listeners will remember. Six years ago, I teamed up with my good friend Arthur S. Falls to broaden the conversation from cryptocurrency to decentralization broadly, as it has and will continue to impact our world. We called it the new renaissance, a phrase I'd begun using before even discovering Bitcoin in 2011, that to me encapsulates the compounding effect of new open-source technologies, as well as older technologies that have been freed of patent controls, and become enabling layers for new technological innovations. Although this discussion occurred more than six years ago, it hasn't aged a day and is in fact arguably more relevant today than it was at the time. I'm very pleased to share this thought-provoking conversation for your listening enjoyment and hope that you have a relaxing day during this crazy time. Thanks for listening. It's the 26th of June. I'm Arthur Falls. And I'm Adam B. Levine. And you're listening to the first episode of the new renaissance, a show exploring the world of disruptive innovation and the cultures that inhabit it. Adam and I have been thinking about this project for a couple of months now, during which time we've spoken to people about subjects ranging from the coming rise of autonomous vehicles, to the NSA's failed battle with the cypherpunks, to the emergence of new virtual realities, subjects linked by an elusive grand trend driving human interconnectedness, free innovation, and extension of the mind. Pinning down a phrase like disruptive innovation can often result in a domain-specific definition, or an expansion on the marketing hype we are bombarded with in tech media. Most likely we think Apple, file sharing, or Silicon Valley. And while for narrative convenience historians may one day cast the valley as the second coming of 14th century Florence. Today, change happens globally. Ideas aren't nurtured in isolation, leaking out as memes carried by inoculated travelers. They emerge from the communal mind of the internet, and they affect us as a global civilization, not just as isolated societies. I think that it'll be really interesting to have this conversation, because I definitely, you know, like, I have my feelings about it as you heard me express over text yesterday. But this is all totally just a thesis. So I really don't know where we're going to go with it. You know, again, it's all about conditions and it's all about what is possible versus what is, you know, suppressed versus what is allowed and all of those things. My understanding of how you kind of view the premise is that we live in a time where there are few social barriers to innovation and to discovering new things. And we also have at the same time this incredible apparatus to enable us to discover and innovate. I would argue that the distinction is in new fields, in new fields that are disruptive. There is a unique opportunity and it's not simultaneous. That's the other thing about it, is that like you look at 3D printing and you can see that there was this period of about five years. We might have already talked about this before. When I got out of my last line of work as a salesman, I was really interested in that because it solved a couple of problems that I had had, which was basically that like if you want to have like a custom made anything that is mass produced, you need like 500,000 or a million pieces. That's like a very normal amount that you would have to order upfront in order to get anything made custom. Whereas with 3D printing, well, you know, it might have a higher per piece cost, but it's possible even at a single unit. And so you look at the way that technology developed and actually 3D printing had its heyday, you know, as far as commercially, maybe 20 years ago. That was when most of the development happened. And then what, it was actually long ago, it was about 26 years ago. And then everything was patented and then it basically sat there for 20 years and nobody touched anything because anybody who did got sued. And so you arrived at the end of that period and that is basically where we saw the RepRap come out. The RepRap used technology, fused filament extrusion that was patented and that had literally a 20 year patent expire on it. And then that allowed about five years of very, very rapid progress where the, you know, the hobbyist 3D printing industry basically was born. And we saw many, many Kickstarter campaigns that pushed forward until they hit the edge of the intellectual property barrier. It was the heated build chamber is the thing. And so we're still waiting, I believe there's another year and a half or two years before the heated build chamber comes out of patent protection. And at that point, then we'll see, you know, suddenly all of these low and cheap printers accommodating that. And because of that, they'll be able to then start building the next steps that come after it. That's what I mean by, it has to be possible. So even though this is old technology, it's still new as far as we're concerned, because it's been monopolized and basically just used for people who had, you know, a couple hundred thousand dollars to spend on one of these machines. So this is where the emissive element comes in, we're no longer being restricted from using these innovations or recombining these innovations that have existed for a long, long period of time, relatively speaking. Right. Proprietary becomes generic. And because of that, then generic can be applied to other things that are generic or even not generic. They can be used as components and things that themselves are proprietary. Say that again. The difference between intellectual property that is controlled versus intellectual property that is not is that controlled, you know, whether through patents or whatever is proprietary, right? It is owned and monopolized by the company that has the protection on it. And they have legal recourse if anybody tries to use it to even not make money, but especially if you're going to make money. So it makes it so that the only types of innovation that can happen are either the most basic and most secret of hobbyist, right? Because again, even if you're not using it for commercial purposes, you could be in violation of somebody else's patent. Oh, and the flip side of that is that things that are kind of just generally available or that have expired patent protection are generally available. And so if technology is generally available, right, I mean, like think about a clock, right? If somebody had a patent on a clock and made it so you couldn't put a clock into anything that needed a clock, then you wouldn't be able to have many things. I mean, like there, there are so many things that rely on clocks at a fundamental level, but even beyond that, the functionality that is provided even when it's not vitally like your microwave, for example, your microwave might work just fine with just an on off button. But at the same time, by being able to incorporate that basic piece of technology into a more complicated piece of technology, you make it more useful, you make it so you don't have to stand there, you don't have to set another time or you don't have to, you know, do anything because it can control itself by integrating technology that at one point was somebody's, you know, lifeblood invention, but over time became this generic piece of kit that could be incorporated into really whatever else you wanted to do it with. So it's much the same here. Sometimes you're talking about process, you know, in terms of like being able to manufacture with 3d printing, you know, and not have to buy, you know, a $400,000 machine instead being able to buy 10 $20,000 machines because there are five companies out there that are making these machines, adding the competitive element into it drops the barrier to entry and by dropping the barrier to entry again, you lessen the restrictions that are sort of normally there. I don't necessarily think that we are in a time when things are really possible or where innovation is really encouraged. I actually think it's the opposite of that. I think that any place where disruption can be avoided to the way that things are, there is a large incentive to do that because people, somebody, somewhere is making a lot of money from the way that things are and it's different people, different places, you know, and each industry has its own Titans and its own monopolies and things like that. And so the places where you see this pop up really are the fringes where there's not much or where as in the case of something like cryptocurrency, it literally cannot be stopped. And so that again, that's another important characteristic of this period we're in is that any, you know, innovation that can be stopped, any disruptive innovation that can be stopped, I guess is the way to say it will be stopped simply because it does make sense to the people who already are in power. There are kind of three things that jumped out of me from that explanation. The first is that we have this, we have this situation where because there is now these patents are expiring on 3D printing because this is a good example, the ability to take those technologies and those innovations that already existed and recombine them with new innovations gives us the ability to produce something an enhanced version of an old technology in the same way that say combining a microwave with it on off switch with a clock gives us an enhanced version of a microwave that may have much more utility than if those two innovations were prevented from being recombined. And also, I think it's interesting that you point out that you use the example of the microwave and the clock because it's a very basic tool for the automation of a machine. You know, just by giving it the ability to control itself in time. Well, it can take over a lot of the cognitive effort that would normally be the responsibility of a person to manage. I would argue it's a good component. I mean, that's the thing is that most technology that's useful, we might think of it as a technology unto itself. We might think of computers. Computers are another example of this, you know, like the processor. That again is something that we primarily know from computers, but it is an open tool. And so as the technology improves, there's nothing stopping people from, you know, manufacturing their own or taking their own chips or using somebody else's chips that they buy in bulk and creating new products with it. So again, like the computer industry actually is sort of the outlier in all of this, really, because in the computer industry, even though there are patents, technology has not really at least obviously, I mean, maybe it has, but at least to my eyes, it doesn't appear that we're being aggressively held back by intellectual property that's controlled for whatever reason, the way the internet and the way computers have developed, the computer business has developed. It's a very competitive market. It's why we see, you know, unlike so many other markets around the world, computers continue to get more efficient, smaller and cheaper all at once. And again, like that's something that should be happening nearly everywhere. But because of the kind of circumstances we find ourselves in, it doesn't. What is the difference between the computer industry and other industries that make it so special, that make it so much more competitive and efficient? To be perfectly honest with you, I don't really know. There really was never a point of monopolization, because you had this differentiation between hardware companies and software companies. And I'm definitely not an expert on this, so this is just kind of what I think of it. But competition is so core to the types of disruptive innovations that we're talking about here. The competition is why people disrupt industries. They see a better way to do it that can obsolete or at least improve upon the existing way. And if they have the opportunity to do it, if they're given that chance, then they take it and they try to make a business out of it. And a lot of times they fail, but sometimes they succeed. And so again, in, well, you know, another thing about computers, though, is that it's a relatively new industry. We had very large IBM style computers back in the 60s and 70s. But the actual like user home experience really has been for most people since the middle of the 90s to now. So we're talking less than 20 years. In the future, we might see Samsung becomes, you know, they come up with some absolutely amazingly innovative technology that they then monopolize and then becomes kind of the gold standard. But again, chances are pretty good that it's going to make more sense for one of their competitors simply to reverse engineer whether it's legal or not their product and offer something that competes. And again, that's possible because there are lots of large players in the space because they've all kind of benefited. This reminds me of the Intel AMD relationship where way back in the day, AMD got its start reverse engineering and producing Intel chips at lower cost. Yeah. AMD was a disruptive new competitor in the space who refused to play by the rules and so benefited by grabbing up market share more quickly than if they'd started from scratch, even though it would later get them in trouble legally. I've got an article I'll be publishing on our blog in the next few days where I explore this idea of disruption and permission by looking at the taxi medallion system and Uber, Napster and BitTorrent. But actually, I think it provides some context to the conversation we're having here today. So let's take a break from this discussion to explore the taxi cab monopoly over time. In my article, does Uber know it's the Napster of transportation? In March of 2014, David Johnston, an influential early adopter and angel investor in the cryptocurrency space, coined what he called Johnston's law, quote, anything that can be decentralized will be decentralized. It's a bold statement, but it comes at a point in history where everywhere we look, we are surrounded by centralized control and the limitations to the actions of the individual that go along with it. Even as recently as 100 years ago, the vast majority of systems you'd be familiar with operated using decentralized decision making and practices simply from necessity. Whether farming or making paper or selling products, the majority of operations were independent and basically at the whim of the person who owned and operated the venture. This is good because since they're in control, they're responsible not to some distant boss, but to themselves. And any failure or missed opportunity is theirs as well as any successes. Decentralization combined with competition and a lack of monopolies doesn't seek to deliver totally consistent results. Instead, it delivers a bell curve as businesses succeed or fail in varying degrees due to the choices that they've made and how the market likes their answers, plus a bit of luck. Decentralization is a core value of cryptocurrency and Johnston identified many, many niches within the global economy where it simply makes more sense for nearly every individual involved to come up with a better way. But if decentralization is so great that it'll be pervasive in our lives, why isn't it already? To answer that question, let's take a look at the taxi industry in New York City. It's one of the largest, oldest, and most controlled licensed livery systems, a term left over from the days when cabs were horse-drawn. It's in the midst of Johnston's law today as Uber and other rideshare alternatives innovate and disrupt the long-standing way things are done. That all started in the late 1930s with the passage of the Haas Act, which for the first time placed a limit on the number of individuals with permission to operate a cab. Previously, to earn your living as a cabbie in New York, you had to find a car and spend your time putting it to use finding and delivering fares. This wasn't a trivial problem. It took resources and work, but there was no need to ask for permission. And most importantly, nobody to tell you no. The Great Depression changed all of that. As the boom of the 1920s became the bust of the 1930s and prospects faded from most corners of the economy, the remaining avenues of opportunity, unsurprisingly, saw enormous inflows of those who now saw this as their best chance to make a living. Early taxis were quite expensive to ride in, and before long the combination of the ongoing slump pushing down the supply of passengers and the inflow of new cabbies creating a surplus of drivers culminated in a crisis. Something had to be done. In 1937, the Haas Act was passed. It created the taxi medallion system, which remains largely unchanged today. In order to operate a taxi, a driver must acquire a medallion which goes on the front of the cab. These medallions never expired, and the maximum number in 1937 was set at $16,900. That's a little more than half a license available per driver operating at the time. So the Haas Act worked to push down the supply of drivers without changing the supply of passengers. And it stuck. The number of legal cabs would never be higher than the year this took effect. And although New York City would recover from the Great Depression, find prosperity, and add millions more to its population over the years, today there are less than 14,000 taxi medallions in circulation. What sold in 1948 for $4,000 or about 4,000 trips at $0.63 per fare to pay off the investment became $26,000 only 16 years later or about $29,213 standard trips at $0.89 per fare. By the 1980s, this was $60,000 or about $19,887 standard trips at $3.02 per fare. Since 1996, we've seen the cost skyrocket from $176.33 or about $33,615 standard trips at $5.24 per fare to pay off the investment to $732,250 or $82,657 standard trips at $8.75 per fare to pay off the investment. And as recently as 2013, individual medallions have been sold for over a million dollars. By any measure, the medallion system raised the cost of both operating and riding in a cab. So what was the gain and to whom it's been argued the taxis were sometimes low quality or had abusive prices in the days before medallions? This might be true, but it's to be expected in a decentralized system that also lacks rules. To this point, the rules of driving a taxi are much the same as those of driving a car. So while a medallion system came with rules and standards for what a taxi must or must not be, that could have happened entirely on its own and at any point. There were two winners of the medallion system. The governmental authority who now has the power to control what a taxi would or would not be and who could be allowed to make their living in that fashion. And perhaps more importantly, the large taxi companies who with fleets of hundreds of cars, the New York taxi cab company opened their doors with more than 600 imported French cabs that went on to be the first, now standard yellow cabs, had a lot to lose. Just like anything else, available supply and immediate demand determines the value of a given service. In the years leading up to the Haas Act, the taxi cab companies were fighting a losing battle as leaner, hungrier competition saw the opportunity to compete for their livelihood and took it. Medallions added a barrier to entry that was easily overcome by those large existing companies, but not nearly as easily for hopeful independence. These medallions or licenses were also perpetual, transferable, and most importantly, there weren't enough of them to go around, even if a third of 1936's cabbies had simply walked away. This meant if you could get a medallion early, it was like money in the bank that would surely get more valuable as time went on. The unfixed growth of passenger numbers would dwarf the fixed or diminishing number of legally usable vehicles. The waves of new drivers during a time of decreased demand was a major disruption that had the potential to fundamentally change the market for transportation. The medallion system was a way to let those powers already in control extend and maintain their dominance, even profit from their eventual demise through the early, indefinite control of permission that allows them to do what others cannot. This isn't to say that the opportunity was uniquely available to these companies, to the exclusion of all others, rather those already in power have a massive advantage in maintaining it, and so often do. Of course, it can be fighting a losing battle to preserve the way things are, but when the transition is won from you being the king of the hill to not being the king of the next hill, your every incentive is to delay or slow the movement, and so retain your position that much longer. Things are as they are for a reason. It might not be great, but change only comes at times of disruption because lacking that, who would bother? Things are great, or at least good enough for those currently on top. Disruption comes in different forms and flavors, by its nature impossible to predict. What can be predicted is what types of people will win and who will lose when the hammer falls and everything changes. Those who are least vested in a given system are much more receptive to critique and suggestion towards its improvement than those who are vested. The master switch author Tim Wu calls this the chronos effect, where early opportunistic innovators who find success with their own innovations soon become settled in the quote, way things are. When in power, rather than enabling further progress of the sort that gave them their place in power, they act to delegitimize, buy out, or crush those who would improve on their improvements. The taxi medallion system was supposed to be good for everyone, but in reality it was a limitation placed on the market that hurt everyone involved. Drivers may have initially wanted less competition in the face of limited takers for their service, and the medallion allowed them to operate where others could not, but this was always an artificial restriction no more real than the ability to enforce it. Really what it did was create two classes of drivers in the system, those who had the medallion and so had the permission to drive but also are made to pay the cost of it, and those who didn't. That cost must be paid for somewhere, and those lacking permission didn't have that problem. The medallion means the cost of legal ride must go up, which means if you're more focused on cash than comfort, there's probably an illegal ride that can better fit your needs. Should people be allowed to use cheaper services that come with fewer guarantees and comforts? In recent years we've seen exactly this as ridesharing applications like Uber and Lyft change the very nature of what a taxi is. Uber is a real company with offices, employees, founders, intellectual property, and staff, but they don't employ any drivers. They're all independent contractors. Drivers self-select within their app and then go through a very basic verification process. Unlike driving a cab, you don't need to buy or lease an official taxi. Unlike driving a cab, you don't need a medallion. Uber is a centralized company that only bothered to centralize its dispatch and support services to enable its decentralized community of drivers to connect with and provide a valuable service to its decentralized community of riders. It's not just drivers who do work the benefits Uber. As part of the experience, a rider rates their drivers after each encounter, and so drivers build up easily accessible reputation scores that can provide some context if they're a good driver to select. What Uber does through riders rating drivers through their app, official taxis are assumed to be safe and worth riding with because they have their relationships or money to acquire the permission to drive a formal cab. One generates conclusions based on a constantly reaffirmed reality. It can tell you many things and the information becomes deep over time. The other generates conclusions based on having paid a bill now or it more likely some time in the distant past. At the time of this riding, Uber seems to be the dominant force in the disruption of taxi services. In reality, Uber is the naps of its market, a centralized company reaping the lower costs of not maintaining a centralized service. Uber seems to deliver on the promise of decentralization in a market that's been getting more expensive and less useful for decades. But if we follow the example a bit further, you'll quickly see the problem. Napster was initially a success, and why wouldn't it be? In a world dominated by CD sales, real and bootleg, Napster offered the ability to, at no cost, download music from the collection of others around the world into your collection. Compared to the existing way of doing things, this was not only revolutionary in its ease of consumption just a few minutes on your 56k modem compared to driving to the music shop, but it was free, never ran out of stock, and had the largest sheer variety of choices the world had ever seen, including many rare, live, or unreleased tracks that would never see the light of day in the legacy system. Those outside the music industry who enjoyed the product of music had a tool here that was undoubtedly better than the one that came before, fast, plentiful, and free. Who could say no to that? It turns out the Recording Industry Association of America and the Motion Picture Association of America could and would go on to sue the nascent Napster out of existence. Even though Napster the company wasn't doing anything illegal, their users were, they argued, and the courts agreed. The service slid backwards in terms of functionality until eventually being forced to close for good. Napster was held responsible for the actions of its users, even though it didn't know any of them, and they were neither employees or customers. The RIAA argued, and the courts agreed, that the company was what mattered, not the users. And so if the company enables or benefits from illegal uses, it's potentially responsible for moderating or controlling those actions. David Johnston said, anything that can be decentralized will be decentralized, but there's a bit more to it than that. Moving from a decentralized system to a better decentralized system isn't that difficult, but to move from a centralized system to a decentralized system is another matter entirely. In fact, anything truly disruptive that can be stopped will be stopped, because disruption always comes at the cost of the already powerful. The powerful, given the option, will always work to preserve their power until the cost of such preservation becomes more damaging than to simply let progress take its course. Uber recently raised a billion dollars from capital markets with a total company valuation of $40 billion. They've made it further than Napster, in no small part because where the music industry was centralized nationally, taxi monopolies are regional. The media industry was able to pull their vast resources to wage a stalling action filled with scare tactics targeting normal users in an attempt to dissuade its use. Uber, on the other hand, is by its nature local, and their competition is too. A taxi medallion in New York has a different cost, different rules, and a different historical context than one in Chicago and one in Miami. So rather than fighting off pressure from some national taxi foundation, they're waging war against the decentralized cohort of local monopolies. Even so, whether Uber will be the dominant ride share or even still in business in five years seems anything but a sure thing. Napster is instructive here as well, because of course when Napster closed its doors, that didn't end the hunger for this new better way. Napster was the most centralized, decentralized file sharing technology would ever be. They had real servers, kept logs of user information, and even provided some of the indexing power to let users search through their massive libraries. After its demise, alternatives started popping up, targeting those users who'd seen the light with Napster, and were now frustrated by being forced to go back to the old way of things. These new alternatives weren't created in a vacuum. Their founders watched closely the troubles encountered by Napster, and designed their tools in such a way to make themselves safer. Or so that was the perception. The next wave of companies found they had followed in Napster's footsteps a bit too closely, and themselves became targets of the same powers who had stopped that disruption previously. This was essentially an arms race between technology and the legal system. Every time the legal system clamped down, purpose-built technology would allow users to route around it, and in doing so be connected more directly to each other and less to whatever company was enabling them. In the modern age we have the BitTorrent protocol, which can be seen as the evolutionary endgame that began with Napster. BitTorrent is fully decentralized and open source. There is no company that operates it, and there are no servers it lives on. Anyone needs simply list tiny magnet files to become a free to download directory, for files you do not host yourself using bandwidth that you will not pay for. If the file is popular, chances are good you'll download faster with BitTorrent than you would through any centralized downloading service. With all those advantages it seems obvious there's money to be made in providing these services, but you'd be wrong and there's a fundamental point to be understood here. Decentralization and centralization can be thought of as the importance of the crowd or the company. Centralized systems rely on the company to be useful at even a base level. It doesn't matter how many users you have or how long you've been around. It doesn't really matter how much attention the service receives. If a company like Napster goes away, all of its users will need to find something else to do, and so the core company is vitally important. With BitTorrent, not so much. So the end game of decentralization in any business stopped up by legality is to fully disintermediate anyone who in the past controlled access for a fee. But the middleman isn't even the problem, rather it seems to be the rules that govern what the middleman can or can't offer. If the limitations placed on what can be offered to paying customers make the object the customer wants not as useful or desirable because of those limitations, the customer will only be a customer if they have no better choice. Other factors are the ability and ease to enforce the rules if you're more likely to get caught you're less likely to do it, and the severity of the punishment if you're caught it will ruin your life perhaps you're less likely than if the punishment was less severe. If in any way you're motive is profit, you wouldn't create such a product as BitTorrent for the taxi industry. But if your motive is to be able to find a market rate ride easily without needing to wait for one of only 13,000 licensed cabs to pick you up in New York City, it's a pretty perfect solution. Give market participants the tools to eliminate the middleman and you also get rid of the regulations since the middleman is the choke point that can be effectively regulated. And there it is. Disruptive decentralization of any industry can only happen if it seems like a good idea. And it can only seem like a good idea if the industry has become stagnant and unresponsive to market forces and its users. Decentralization quote routes around the damage in the truest sense of the word by simply excluding the no longer necessary parties and connecting users directly to users. Once the world awoke to MP3s, the business of music would never be the same again. At the core, this whole issue is about choice and who gets to make it. Disruptive decentralization is a natural reaction that once begun is unstoppable in any market or industry whose services or products people actually want or need to use. Whether you're talking about healthcare or finding a cab, sharing your favorite music with a friend, or even something as critically important to society is the money that we use. The systems are unwilling or unable to meet the needs and so alternatives that operate outside the system have been found. And we're right back to where we started. Johnston's law states anything that can be decentralized will be decentralized to which I'd like to add the Levine counterpoint anything disruptive that can be stopped will be stopped. And in the pressure cooker world that we call the new renaissance, we all get to watch how right Johnston was. I don't think I've actually given kind of my overview of what I think. Yeah, we've been talking details on it, but we haven't actually talked about the basic case here. No, not at all. Okay, so then let me just go over that real quick. Okay, so about two years ago, I recognized that there was a confluence of technologies. There were a number of technologies that all had these kind of disruptive characteristics about it and also were being developed in a pretty open fashion too. And that combination of things is interesting because it means rather than having to wait 20 years for somebody's to invent it, then the patent to expire, and then to be able to use it without having to, you know, maybe they won't give any licenses to anybody at all, or maybe they just charge a couple hundred thousand dollars per commercial license they sell. Either way, it doesn't really matter. It effectively makes it so that most companies that might do it because they recognize the opportunity to connect those dots are going to because the cost to do it is too great. So because these technologies are being developed in the open and because they're, many of them are open source too. So again, examples of this are the development recently in 3D printing. I've been talking recently about virtual reality. Cryptocurrency is a huge element of this because it provides a kind of a money layer that goes on top of it all. And now with the work that I've been doing recently on tokens, I realized that it also provides a secure access layer. So that's very interesting. But there are a variety of these kind of enabling technologies that because they can all be used together, we can solve problems that didn't really use to be feasible to solve, whether it was impossible or just too expensive. Because of that, because there's this giant pile of opportunity just lying there. For people who have problems, who have problems that couldn't be solved, and who really still feel those problems as painful. Arthur, maybe I'm not sure if you've had this experience, but I've talked to a lot of people who are very interested in cryptocurrency and were really big fans of it, who are older than 60. And many of those people are people who apparently have worked on barter systems and worked on money systems or worked on banking systems, worked on all these different things that were just completely impossible at the time that they tried to do it. And oftentimes, I know people who struggled for 15 or 20 years trying to solve these problems and they had given up. And now they look at this and they say, oh, well, this actually is a component, this one component of cryptocurrency, I can just integrate that and I can do this thing that used to be impossible for me. And so they're re-energized and they come back to productive action because the possibility exists where it previously didn't. So that's an opportunity, again, that's felt first by people who had that problem, assuming they find out about the technologies that they actually can solve the problem for them. But it also represents arguably the greatest opportunity that exists right now. If you actually want to create something, if you don't want to get a job right now, which seems to be kind of the other option out there, you can take these components. And for not very much money at all, compared to even 10 years ago, start to create applications that do things that were impossible. And again, you're doing it for a fraction of the cost of what it would have cost to have failed all those years ago. So the downside to trying is much less. And so because of the downside to trying is much less, we get many, many more people who start these projects. So one of the interesting parts about decentralization is that one hand often doesn't know what the other is doing. Rather than just everybody picking their favorite project, but then saying, oh, well, Bob over there, he's working on that problem. So I'm not going to work on that. Instead, everybody who thinks that the problem Bob's working on is the problem that needs to be solved, they basically all roll their own solution. And then at the point that they come out, we've seen this a couple of times now, we saw it with the early Bitcoin exchanges and things like that. It was like, there was none, then there was one. And the one was the only one for like nine months or a year. And then there was five. And it wasn't because everybody wanted to create an exchange, it was because nobody knew that everybody else was already creating an exchange. And so it just, that's how it wound up happening. Possibilities, again, for pushing forward are not just that one company that you get in a linear system, it's the exponential system because even if four of those projects fail, whilst you still had the one, maybe that's a project that wouldn't have started had the bar not been so low. I see what you're saying. So and then what you've got as well is because of the open nature of innovation, you have the particular elements that each exchange did well, that can then be integrated into others, either by being reverse engineered or by being rolled together by a new competitor that sees an opportunity. Yeah, my mother has a quote that I like, if you can't be a shining example, at least be a horrible warning. So I mean, right? I mean, like, if you're that guy running around with his hair on fire and you got hacked and like you're having all these problems, you're a really, really good signpost that says, don't do what this guy did, this was a bad way to do it, avoid, avoid, avoid. And that's a really valuable thing. I mean, we see scams constantly, you know, just on the internet because it's possible. But again, you know, like having those big public examples of failures, that's just as valuable as having the ones that succeed because it informs the successes. That's the other part is that everything is additive. So what is created now becomes the basis for what will be created becomes the basis of experience for what, you know, for what the next group of people will do. And again, that's another interesting part about this time is that, you know, is that where usually you see innovators clamping down at the point that they achieve any sort of success. Now, you're not really seeing that now the ability to clamp down is really limited if for no other reason than people in large quantities are building on open source technology, which makes it quite difficult to have a completely proprietary product. Yeah, right. That's, that's pretty bloody astute, Adam. You know, I've, because I've been wrestling with this myself a bit. And I've been trying to find a way to kind of bring it down to something, to shrink the scope as much as possible. Because when I think the new Renaissance, it brings me back to that time. Remember, Occupy, right? I don't know if you remember. Everyone remembers Occupy and how it kind of, it took off and everyone thought it was this big movement. And then eventually it peated out and everyone went home. And people kind of felt a bit cynical about it. I was talking to a few friends around that time. And I remember in particular, this, this one guy was just like, you know what, the US government is so broken, it just can't be fixed. And I thought, you know, that is the most pessimistic, cynical and, you know, lazy, apathetic attitude you could possibly have. Looking back on it now, I kind of see it as an awareness that there is a problem and also an understanding of the intractability of it. And I think that what happened with, with Occupy was when everyone, all these people who didn't realize that everyone cared found this, this central outlet to get together. And while it peated out, the knowledge and the desire for change is still there. And those folks have all moved on to different things. And it seems like a lot of that informs kind of what we know as the cryptocurrency movement. You know, a lot of that ideology is beginning to inform the technology that people are creating, you know, with the purpose of actually freeing ourselves from these centralized power structures. I think that that is very astute. And to be perfectly honest with you, that pessimistic viewpoint is the one that I've had for a number of years now. During the Occupy event, I didn't attend, but I did a podcast that essentially provided a connection between different Occupy rallies and that let people make different reports. I only did four or five episodes. It wasn't very good, very listened to or very long. But, you know, the thing about Occupy is that, again, it's that anything disruptive that can be stopped will be stopped. When you have people in the physical space, I mean, those Occupy, many, many of those events were attacked by police repeatedly. It was not the sort of thing where they just dispersed because everybody got bored and went home. It was really, I mean, there was effort and force applied to make that go away and to make it painful. And it did. And I think that one of the lessons that came from that, again, is that the old ways of doing things that, you know, used to be able to enact change do not work anymore. The system is designed in the way that it, again, anything disruptive that can be stopped will be stopped. In this case, it was disruptive to the way that the country works here. And this was not a thing that was unique to America. You know, it's something that was happening all over the place and America just kind of jumped on board. We oftentimes don't have the incentive to do that because we have better ways of dealing. But in this particular circumstance, that's how it happened. It's interesting that you had that sense of cynicism, though, because I think that pessimism, that feeling that the whole world's apathetic and no one cares is in fact a symptom of the world caring. You're actually experiencing flux. You know, you're looking back on the old as the leading edge of the new caring informed population. We have the internet, you know, we're the most connected people. You know, human beings have never been so connected ever before. And as we come to understand the world that we live in and we see the injustices in it, I think it's easy to feel like people just don't care. But in fact, the fact that you feel that is an indication that you do care. And that's the bleeding edge. That's the moment of change that's gradually sweeping through the population. I agree with you. But I don't feel that nobody cares. I feel that there is no good outlet for that caring. I feel like the ways and the methods that previously would have been used to change the governments of the world or our particular governments, wherever you may be, no longer function because the governments of the world decided that they would rather that they not have the accountability. And so because of that, the decision for me isn't to be a pessimist or not. The decision to me is to simply recognize a truth as a truth. The system will not fix itself. The system will not allow itself to be fixed from the outside. The system will not be fixed from the inside because all of the incentives lead to it not being fixed because everyone on the inside benefits from it not being fixed. So my thesis for quite some time actually has been that the system will continue, the governments of the world will continue to operate as they have been now for about seven years and certainly longer than that. But in this acute fashion for the last seven years, until they no longer can. And I think that again, if you look at the world, we've seen that we see that rather than let single small failures occur, we continue to see risk wrapped up into larger and larger and larger bundles to the point where we're no longer talking about a couple of banks failing, we're talking about entire countries failing, we're talking about entire, you know, I mean, again, like this is not even controversial to talk about anymore. The system will not fix itself. So the question is, do you continue to try and work within the system to fix it knowing that it won't fix itself and knowing that you will not have any impact on it? Or do you focus on building things that simply don't have any sort of regard whatsoever at a fundamental, this is how it operates level for the structures that you think are breaking things. And that has been my decision with cryptocurrency and everything else too. Comes down to that word that's starting to be, I see it kicking around a little bit now, illegality, systems that are not capable of recognizing a law or a rule set. They merely exist and participation in those systems is at the discretion of the end user. There's this idea, I think, when I look back at, like, you remember the Iraq war and how everyone got up in arms while that decision was being made. And, you know, no one wanted to go to war because who wants to do that? It's expensive and can wreak your economy. When they look back in history, a lot of people think that the Vietnam War was this highly protested war. And it was toward the end, but not until the very end. I mean, the Iraq war is one of the first examples of the US public actually protesting a war in advance of its beginning. And I think that's a huge indicator that the general public and the behavior of the governing bodies of this country are diverging in their attitudes. And I think that the outlet that people are finding, like you were saying, for many, is this open source movement and the development of these systems that simply don't care about the legal system that they may exist in. I don't know if it's necessarily that they don't care about it because, like, all the projects I'm working on, you know, we're going to be complying with laws and things like that, paying taxes, all of that stuff. There's really no question. Again, if you want to exist in the system, then you have to be developing things that are compatible with it. But I think that the difference is that developing solutions that are compatible, right? There's no problem to Bitcoin or the dollar with them both operating alongside each other. But if the dollar were to fail, there's no problem for Bitcoin. Bitcoin's still there. It's not connected. It's not impacted at all. And that's not necessarily about cryptocurrency. That's about decentralization. You know, so much in our world, whether it be by private companies, by governments, by individuals, whatever, is centralized on a very small group of people. And so that makes it relatively easy to coerce those people or for them to just take actions that are frankly not acceptable. And yet, because they have this proprietary thing, you know, again, PayPal is an interesting example of this. PayPal does whatever they want. Did you hear about what happened with PayPal and Mega, Kim Dotcom's company? Tell me. PayPal issued a public letter that said we are ceasing to process transactions for Mega. But this is not because we believe Mega is doing anything wrong. We've conducted our own investigation into their company. It appears to be upstanding and fully compliant. We are ceasing processing transactions because Visa has insisted that we do so and in spite of our protests. So it's interesting to see that. And you remember when Visa stopped processing, he leaks transactions. So you've definitely got Visa itself as a common feature in these US crackdowns on cryptography. And I don't know, copyright, it's hard to know where in the narrative Mega fits. You know, there are lots of narratives. There's the Kripley-Wolls narrative. There's the anti-copyright narrative, the anti-piracy narrative. But definitely Visa is a tool, is a weapon that the US interests wield without any abandon. Yeah, I would argue national companies in general, you will find if there appears to be a high degree of coordination between the government and the technology that enables, and that's especially true in money. These companies that are national companies, they do what their host country says. And if they don't, then they are punished. I mean, like you can look at rating agencies for an example of this. I can't remember who it was. It might have been S&P or it might have been Moody's. It was either S&P or Moody's. The US was downgraded at its credit rating downgraded after we went through a fiscal clip sort of situation and it looked like there was going to be a default for a minute. It was enough that it caused the rating agency to downgrade them from to downgrade the country from AAA to I think it was just AA plus. And the government, like two days later, brought a suit against them, the Justice Department for something completely unrelated that they then dragged them through court on for about two years until they eventually paid, I think it was a $2 billion fine. It was a very, very expensive fine and had to admit that the government didn't actually, like it was absolutely unreal. But the reality of it was they're never going to do that again. You know, S&P or Moody's, they're never going to do that again because they were punished for it by their host government. And as a result, they lost in a variety of ways. It cost them money, it cost them prestige, it cost them customers. There were a variety of things that happened. So the power that these host governments have over the companies within them is incredibly profound. I mean, again, like if Visa was found to be doing transactions with Iran who were not allowed to do transactions with, if they were to violate any of the rules that the host country has set in place, then their business model is basically forfeit. So they are very, very careful to not step on the wrong side of the line. And if they do, to make it right very, very quickly. And this brings us back to this idea of permissiveness and how you say we don't actually live in a permissive age. We live in an age where our rights and liberties to use an awful word. I hate those words freedom and liberty. I mean, only in, you know, they make my skin crawl. For some reason, you know, those are being curtailed. We live in a time of really of oppression in the grand scheme of things. It's like that Frank Zapper quote, when it becomes too expensive to maintain the show, the chairs will be taken away, the scenery will be pulled down, and you'll just be left staring at the brick wall at the back of the theater. That is correct. There are three basic states that I think that as kind of broad civilization, obviously this is highly localized, you know, each place has its own kind of blend of these things. But just generically, we can talk about three different states. We can talk about a time when opportunity is suppressed, where it is impossible, right? So where it's impossible to solve whatever the problem is that you're attempting to solve or to solve the problems that society faces, and it's not allowed even if it was possible. There's the times when it's possible to impact society in these positive ways, or at least we think of them as positive ways, because change generally is perceived differently by different people, where it is possible, but it's suppressed, right? Where you're not allowed to actually do the innovation. So it doesn't matter that it's possible. And then there are times where it is not suppressed, you might call it free, you might call it something else, and where it is possible. And that really, I think, is at the core of what we're talking about here. We have all of the pieces in place now. And we're actually starting to see, I think the first generation of these technologies that are being grown in this open fashion that will then enable the next layer of technologies to be in that third state. It is possible to make the changes that people so desperately want to and need to make to the society, whether it be technological or otherwise, and it can't be stopped. And there are some places where it certainly can be stopped. But as a whole, the movement, I think, again, towards decentralization makes it very, very difficult for the age that we live in, the people who control the times that we live in. Our leaders, frankly, that's really who I'm talking about when I say the people who control things. I'm saying our elected leaders all over the world, or not elected in some cases, who have, for whatever reason, made the decision in very large numbers that the interests of the country should come above the interests of the citizens of the country. That has created this situation. It can't be stopped. It's possible to solve the problems. And the problems are so, so intractable and so obvious to anybody who is paying attention. Thanks, Adam, for doing what you do so well. I edited this one and Mark a Million provided the catchy Mozart remix. For those in the know, the magic word for this episode is pilot. That's P I L O T. That's it for now. But we will be back. What did you think of the new renaissance? We're going to be starting off as a twice monthly show with new episodes released in the evenings on the second and fourth Sunday of each month. If you have questions, comments or feedback, please direct them to Adam at Let's TalkBitcoin.com and I'll make sure that Arthur sees them too. Thanks for listening.