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Speaker 1: Pushkin. If you spend any time reporting on the world

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Speaker 1: of cryptocurrency in bitcoin, then you're going to run across

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Speaker 1: the name Molly White. She's a software engineer who has

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Speaker 1: this website with fonts that looked like a dot Matrix

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Speaker 1: printer made them in nineteen ninety seven. The site has

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Speaker 1: a sarcastic title that I just love. Quote web three

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Speaker 1: is going just great and is definitely not an enormous

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Speaker 1: grift that's pouring lighter fluid on our already smoldering planet.

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Speaker 1: End quote. All of that is her title. When I

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Speaker 1: read that, though, I knew that for my next book,

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Speaker 1: I needed to get Molly White on the phone. This

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Speaker 1: is on background from Against the Rules. I'm Michael Lewis.

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Speaker 1: Crypto has always had skeptics and critics, but Molly White

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Speaker 1: is a researcher who really knows her stuff. She's consulted

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Speaker 1: on federal legislation to regulate the industry, and she's an

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Speaker 1: activist in small ways, such as persuading the Wikimedia Foundation

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Speaker 1: to stop collecting donations via cryptocurrency. All that, plus her

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Speaker 1: outspokenness online has put her in the line of fire.

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Speaker 1: And we'll get to that. Welcome Mollie. So all of

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Speaker 1: this is in service of this book I'm writing about

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Speaker 1: FTX and Sam Bankman Freed. And I assume you kind

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Speaker 1: of followed the media coverage a bit because you're interested

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Speaker 1: in the space. What do you make of the public

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Speaker 1: response to it all?

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Speaker 2: I got very frustrated at one point, not too long ago,

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Speaker 2: that a lot of the story seemed to be that

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Speaker 2: Sam Bankman Freed was just a kid who got in

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Speaker 2: over his head. That was a very prevailing narrative, which

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Speaker 2: was really irritating to me as someone who is about

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Speaker 2: the same age as Sam Bankman Freed and who you know,

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Speaker 2: has a head on my shoulders. But you know, I

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Speaker 2: have been happy to see that ftx's collapse did seem

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Speaker 2: to precipitate a fair bit of skepticism in the crypto

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Speaker 2: industry that maybe hadn't been there before. You know, there

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Speaker 2: had been a series of collapses in crypto since you know,

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Speaker 2: the spring of twenty twenty two, but they were not

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Speaker 2: as significant in size as ftx's collapse. And so I

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Speaker 2: think that ftx's collapse really helped to drive home some

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Speaker 2: of the skeptical narratives that were beginning to emerge in

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Speaker 2: the media in the.

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Speaker 1: Very beginning, when bitcoin is created in what two thousand

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Speaker 1: and eight, Maybe I can't remember.

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Speaker 2: That, Yeah, two thousand and eight or two thousand and nine,

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Speaker 2: depending on how you define created.

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Speaker 1: And so so you encounter it, you get a sense

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Speaker 1: of what it is. Most people who went through that

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Speaker 1: process either became bitcoin fans, or like me, looked at

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Speaker 1: it and said, I'm having no emotional reaction to this

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Speaker 1: at all. You had an emotional reaction to it, like

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Speaker 1: you start to get bothered by it.

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Speaker 2: Well, that came a lot later after I originally learned

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Speaker 2: about bitcoin. I would say, first, my first reaction was

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Speaker 2: largely disinterested, because I wasn't trying to buy drugs on

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Speaker 2: the Silk Road, and I wasn't interested in all of

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Speaker 2: the sort of mad financial speculation because I didn't have

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Speaker 2: altogether that much money that I was going to be

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Speaker 2: able to put into something like that, and so I thought, Okay,

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Speaker 2: that's cool. I hope they have fun over there, and

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Speaker 2: then I went on and did my own thing until

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Speaker 2: twenty twenty one or so, when it turned into something

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Speaker 2: very different that was, you know, being marketed to every

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Speaker 2: person who watched a football game or you know, read.

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Speaker 1: The news and what bothered you about that?

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Speaker 2: Well, I was annoyed at how it was being presented

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Speaker 2: to people. The coverage, especially in late twenty twenty one,

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Speaker 2: was enormously positive. It was all about, look at this

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Speaker 2: person who at least a set of NFTs and now

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Speaker 2: they can, you know, work as an artist like they

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Speaker 2: always dreamed instead of having to have three jobs, you know.

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Speaker 2: Or look at this person who made some wild bet

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Speaker 2: on this you know, token that you've never heard of,

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Speaker 2: and it went up ten thousand percent and now they

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Speaker 2: are driving Lamborghinis. It was a lot of stuff like that,

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Speaker 2: and it was a lot of reprinting of press releases

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Speaker 2: from crypto companies who are promising that this was not

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Speaker 2: only some way to get wealthy, but it was the

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Speaker 2: future of technology and the web and society. And while

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Speaker 2: we were seeing that, we were also seeing actual real

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Speaker 2: life evidence of people who were getting taken for a

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Speaker 2: ride by these same technologies. But it was not getting

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Speaker 2: the kind of attention that you know, the feel good

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Speaker 2: stories were getting, and so I felt like people were

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Speaker 2: broadly being told that you should go invest in this,

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Speaker 2: you should put your money into it, money that you

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Speaker 2: cannot necessarily afford. To lose, which did not seem right

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Speaker 2: to me understandably.

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Speaker 1: So what do you do then, Like, when do you

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Speaker 1: set yourself up as a bitcoin critic?

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Speaker 2: Well, so I've been a Wikipedia editor since I was

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Speaker 2: like thirteen years old.

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Speaker 1: All right, stop, how does that happen? How at the

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Speaker 1: age of thirteen are you editing Wikipedia articles?

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Speaker 2: Well, it's the encyclopedia that anyone can edit, and I

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Speaker 2: discovered that at about the age of thirteen.

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Speaker 1: But little kids are supposed to be using the cyclopedia,

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Speaker 1: not writing it. Well, but I saw that you could,

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Speaker 1: and I was what's the first Wikipedia article you edited

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Speaker 1: at age thirteen?

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Speaker 2: I am pretty sure it was the article on unicycles,

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Speaker 2: because at the time I was very interested in unicycles.

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Speaker 2: I am kind of a person who attracts weird hobbies.

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Speaker 1: I would say, So, you were interested in unicycles and

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Speaker 1: you edited the article an article on Wikipedia, and it's stuck, right,

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Speaker 1: you were able to do and actually function is an editor.

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Speaker 2: Yeah, it's stuck for a while. I think it wasn't

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Speaker 2: a very good edit by any stretch. But you know,

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Speaker 2: there weren't all as many people sort of helping with

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Speaker 2: quality control back then. You know, I started at thirteen,

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Speaker 2: I sort of dabbled in it for a while, and

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Speaker 2: then I became very active in it when I was

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Speaker 2: in high school and have been basically ever since. And

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Speaker 2: it's something I really care a lot about, and so

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Speaker 2: my first instinct when I see something that I think

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Speaker 2: is not being covered well is to go write the

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Speaker 2: Wikipedia article about it. And so the first thing I

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Speaker 2: did was I wrote the Wikipedia article about the cryptocurrency

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Speaker 2: blockchain web three, because at the time, it didn't really exist,

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Speaker 2: and so I started researching it, and I realized that

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Speaker 2: what it was describing itself as was very different from

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Speaker 2: what it actually was in reality, and it seemed to

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Speaker 2: me to be being used as a cover for all

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Speaker 2: of this sort of fraud and scams and if nothing else,

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Speaker 2: you know, major financial speculation that was very dependent on

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Speaker 2: the average person believing the story that was being told.

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Speaker 2: And so that was when I became really skeptical. Then

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Speaker 2: from there I started my website, which is web three

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Speaker 2: is going just great, because I realized that what I

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Speaker 2: wanted to highlight was all of these projects that were

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Speaker 2: failing and scamming people or falling apart and people were

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Speaker 2: losing money, and Wikipedia just wasn't the place for that,

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Speaker 2: and that was when I really started to also research

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Speaker 2: the sort of technology, the ways that both financial systems

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Speaker 2: are working as well as the technological systems, and that's

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Speaker 2: when I became even more critical and skeptical of cryptocurrencies

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Speaker 2: in general, including bitcoin.

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Speaker 1: Did you receive any blowback?

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Speaker 2: Not initially, I think, because not that many people noticed

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Speaker 2: what I was saying initially. But when I started the

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Speaker 2: website and the website started to gain traction, I think

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Speaker 2: people began at that point to sort of push back

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Speaker 2: on what I was doing because, you know, to some extent,

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Speaker 2: I think they saw it as a threat to their

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Speaker 2: ideology to some extent.

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Speaker 1: Absolutely, And I'm wondering what kind of responses you've gotten

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Speaker 1: from from the religion.

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Speaker 2: It's run the gamut to some extent. So a lot

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Speaker 2: of it is you don't know what you're talking about,

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Speaker 2: you don't understand the technology. Is very common. I get

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Speaker 2: some people who are somewhat accepting of the stuff that

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Speaker 2: I do, and they see it as a useful service

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Speaker 2: as far as improving the technology, which I think is

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Speaker 2: a very reasonable way to respond to criticism. I think

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Speaker 2: technology criticism is critical for technology development. And then I

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Speaker 2: often get a lot of very hostile responses, especially from

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Speaker 2: the bitcoiners that are extremely sort of ideological, and they

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Speaker 2: can be very aggressive.

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Speaker 1: This is just an aside, But are those responses typically

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Speaker 1: coming from men?

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Speaker 2: Uh? Yeah, pretty much experience.

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Speaker 1: Yeah, no, it is. I mean, it really is a

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Speaker 1: male driven phenomenon, right, I mean that there are a

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Speaker 1: lot of crypto bros. But there aren't a lot of

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Speaker 1: crypto women.

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Speaker 2: Yeah. I run into them. They don't tend to be

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Speaker 2: into bitcoin specifically. They're often in other parts of the ecosystem,

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Speaker 2: and they don't tend to be quite as aggressive or

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Speaker 2: cruel as as the men are.

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Speaker 1: So back to like you getting your mind around bitcoin

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Speaker 1: and starting to criticize it, I wonder if you had

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Speaker 1: the experience I've had where I mean I had people

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Speaker 1: trying to get me to essentially endorse it, promote it

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Speaker 1: all the rest from about I don't know twenty twelve,

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Speaker 1: where people would say, coming, we're going to teach you

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Speaker 1: about bitcoin, and each time they kind of had a

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Speaker 1: different story about not what crypto was, but what its

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Speaker 1: purpose was, like, what problem it would be solving, what

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Speaker 1: its place in the world was. It kept changing. It

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Speaker 1: was like a solution in search of a problem, and

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Speaker 1: you never found the problem.

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Speaker 2: That's all crypto is really is the narrative. And as

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Speaker 2: long as they can find a narrative that is sufficiently

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Speaker 2: compelling at any given point, then they can keep prices up.

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Speaker 2: But it never actually fulfills those narratives, and so the

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Speaker 2: narrative has to constantly shift.

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Speaker 1: Hold that thought, and when we get back from the break,

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Speaker 1: we'll hear about the many narratives of bitcoin over the years,

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Speaker 1: and back with blogger Molly White as we go through

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Speaker 1: all the promises bitcoin enthusiasts have made over the years.

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Speaker 2: You know, the idea is that bitcoin was going to

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Speaker 2: become the world's currency, was really popular at one point,

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Speaker 2: and then people realize that, oh, it doesn't function as

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Speaker 2: well as currency at all, and that's never going to work.

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Speaker 1: And why not just explain why it doesn't work well

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Speaker 1: as a currency.

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Speaker 2: Well, when you have an extremely volatile asset, people don't

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Speaker 2: want to just trade it around for you know, their

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Speaker 2: rent or a hamburger. They want to hold on to

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Speaker 2: it and hope that it goes up, or they want

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Speaker 2: nothing to do with it because they're worried they're going

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Speaker 2: to lose money. And so you know, in order for

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Speaker 2: something to function as a currency, it needs to be

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Speaker 2: relatively stable, which is absolutely not Bitcoin or the other cryptocurrencies,

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Speaker 2: aside from the dedicated stable coins, which often are also

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Speaker 2: not stable.

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Speaker 1: But there's also a problem with its ability to just

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Speaker 1: process transactions. If we're made to use bitcoin for all

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Speaker 1: of our financial transactions, how long would it take to,

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Speaker 1: like buy hamburger.

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Speaker 2: Yeah, it does have issues as far as the speed

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Speaker 2: of the network, and there are a lot of sort

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Speaker 2: of proposed fixes to that. You know, they're trying to

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Speaker 2: sort of band aid on top of the problem that

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Speaker 2: Bitcoin is a very slow network, but the the fixes

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Speaker 2: often introduce even more problems of their own.

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Speaker 1: Right now, I can remember that was the first pitch,

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Speaker 1: the twenty twelve pitch I got was it's going to

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Speaker 1: be the world's currency. Like you can't trust central banks

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Speaker 1: and you know they're always going to lean towards inflation,

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Speaker 1: that the dollar in your pocket's not going to be

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Speaker 1: worth as much tomorrow as it is today. And bitcoin

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Speaker 1: doesn't have that problem. It's inherently deflationary, and that was

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Speaker 1: going to cause people to want to use it as

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Speaker 1: a means of exchange. Tell you a funny story. The

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Speaker 1: first call I got, I was so intrigued. They said,

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Speaker 1: come down to Palo Alto and there's some crypto entrepreneurs here,

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Speaker 1: and they were actually some people end up being pretty

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Speaker 1: prominent in the movement. Many of them went on to

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Speaker 1: be very rich. And they say, come down, we're going

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Speaker 1: to introduce you to Satoshi. And that was like, really,

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Speaker 1: are going to get to meet Satoshi. Satoshi wasn't there,

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Speaker 1: but they were trying to explain to me yet.

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Speaker 2: I mean, maybe he was, maybe he was.

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Speaker 1: Maybe he was right. And when I got out of

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Speaker 1: the car in Palo Alto, I parked about a block

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Speaker 1: from the house they told me to go to I

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Speaker 1: could smell the weed from a block away, and I

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Speaker 1: got there. They're all smoking dope. They're all talking about

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Speaker 1: how this is the future. And I said, like, I mean,

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Speaker 1: I can't use to buy anything, and they said, you

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Speaker 1: absolutely can. We have a coffee shop just downtown Palo

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Speaker 1: Atto that takes bitcoin. And so they put five dollars

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Speaker 1: worth of bitcoin on my phone and we walked down

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Speaker 1: to the coffee shop so they could show me how

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Speaker 1: this was the money of the future. And I ordered

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Speaker 1: a latte and fifteen minutes later, we're still trying to

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Speaker 1: figure out how they're gonna do The coffee shop has

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Speaker 1: said they'll take bitcoin, but like, nobody really knows how

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Speaker 1: to do it. It's an unbelievable pain in the ass.

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Speaker 1: I remember thinking, if for some reason bitcoin was the

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Speaker 1: original currency and someone invented fiat currency afterwards, everybody would

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Speaker 1: be screaming, hallelujah. You know, it's like, it's so much

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Speaker 1: better that then. So that was the first thing it

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Speaker 1: was supposed to do, and you're you're absolutely right, it's

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Speaker 1: the narrative. What was the second narrative When that narrative

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Speaker 1: clearly was not flying anymore? What replaced it?

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Speaker 2: Yeah, there's also bitcoin as an inflation hedge, which you mentioned,

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Speaker 2: the idea that you know that fiat currency is going

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Speaker 2: to inflate into oblivion and so all of your dollars

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Speaker 2: are going to be worthless, and so you should put

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Speaker 2: them into bitcoin so that that doesn't happen.

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Speaker 1: The way you would put it into gold.

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Speaker 2: Correct. Yeah, Bitcoin as digital gold is a very common narrative.

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Speaker 2: I also don't believe that has really held up. You

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Speaker 2: typically don't want your inflation hedges to be enormously volatile

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Speaker 2: in the way that bitcoin is. But you know, I

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Speaker 2: think that generally speaking, it doesn't actually behave as an

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Speaker 2: inflation hedge and the way that people would like it to.

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Speaker 2: And I think a lot of people have started to

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Speaker 2: acknowledge that bitcoin is not a great inflation hedge because

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Speaker 2: it largely follows the market.

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Speaker 1: But you got to make gold itself is weird. The

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Speaker 1: whole idea that people sort of arbitrarily pick a thing

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Speaker 1: and say that's going to be the store of value

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Speaker 1: against you know, it is going to be measured against

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Speaker 1: inflation or measured against that. People are going to treat anything,

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Speaker 1: put anything in this role. So to me, in a

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Speaker 1: funny way, that's probably the best story they've told that

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Speaker 1: it could. If everybody arbitrarily agreed that this was the

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Speaker 1: new gold, there'd be some hope there because it is.

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Speaker 1: It does have this going for it. It's scarce, right,

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Speaker 1: There's no risk that they're going to be some huge

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Speaker 1: number of new bitcoin introduced that will inflate away the

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Speaker 1: value of bitcoin.

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Speaker 2: Not practically no, I mean, there's nothing stopping the code

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Speaker 2: from changing in that way, aside from you know, societal

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Speaker 2: belief among bitcoiners. But I think that practically speaking, it

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Speaker 2: never will.

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Speaker 1: Right, But there was a side argument similar to the

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Speaker 1: gold argument. I wonder if you caught this narrative that

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Speaker 1: it worked really well as an asset in a portfolio

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Speaker 1: because it wasn't correlated with other assets.

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Speaker 2: Yeah, that's the common one too, is that it's you know,

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Speaker 2: totally divorced from stocks or whatever it may be. But

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Speaker 2: that has all they're not played out to be true.

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Speaker 2: It you know, very closely followed a lot of other

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Speaker 2: asset classes.

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Speaker 1: Yeah, no more more it moves with a Nasdaq, but more.

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Speaker 2: Extremely Yeah, just swings further.

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Speaker 1: Are there any other stories that sort of have been

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Speaker 1: proposed and that either have fallen out of favor or

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Speaker 1: that are still kind of floating around.

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Speaker 2: I mean, there's a lot of use cases that it's

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Speaker 2: proposed for. So a lot of people will say that,

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Speaker 2: you know, bitcoin is brilliant if you are you know,

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Speaker 2: sending remittances, for example, is a common one. Ye, people

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Speaker 2: aren't doing that. They could be, but they aren't right,

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Speaker 2: and it's broadly because you know, it's it's not great

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Speaker 2: for that compared to a lot of other alternatives. I

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Speaker 2: think one of the most compelling arguments that I've heard

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Speaker 2: is the idea that bitcoin is a viable asset for

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Speaker 2: people who are in really bad situations for whatever reason.

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Speaker 2: So you know, pick your scenario. It could be that

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Speaker 2: they're living under an authoritarian regime, or they are in

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Speaker 2: a country where the FIA currency is actually hyperinflating, and

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Speaker 2: so people can use it, you know, as a sort

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Speaker 2: of one time escape patch where they can flee the

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Speaker 2: regime using bitcoin or whatever.

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Speaker 1: But it's but that's just a way to as a bridge.

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Speaker 1: Bitcoin is a bridge to get.

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Speaker 2: The hell out and into something else, right, And I

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Speaker 2: also think that it isn't scalable in the sense that

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Speaker 2: if you know, an entire population started to try to

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Speaker 2: flee a country using bitcoin, it would pretty quickly be

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Speaker 2: stamped down on. You know, we've seen that with the

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Speaker 2: Taliban for example, when people started to use it for

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Speaker 2: that purpose. But I also just think that the idea

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Speaker 2: that like a bad solution is a better solution in

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Speaker 2: a very bad situation does not actually make a very

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Speaker 2: strong argument for that bad solution, right, Like, it's it's

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Speaker 2: great that people are able to use it for the

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Speaker 2: purposes that you know, they need to, but that doesn't

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Speaker 2: actually mean that bitcoin is something that we should be

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Speaker 2: broadly embracing, you know, for purposes outside of emergency situations,

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Speaker 2: for example.

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Speaker 1: Right, it's been funny to me to watch even the

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Speaker 1: dark use cases being undermined, like money laundering, like or

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Speaker 1: put it more politely, Bitcoin's great because your transactions are

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Speaker 1: entirely secret and no one will ever know what you did,

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Speaker 1: where the money went, and where and where it's going to.

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Speaker 1: That turns out not.

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Speaker 2: To be true, right, Yeah, that fell apart pretty quickly.

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Speaker 1: I would I would love you to you to explain

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Speaker 1: why bitcoin's maybe not the best way to launder money.

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Speaker 2: So, anytime you send a bitcoin transaction, it's recorded on

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Speaker 2: the Bitcoin ledger, which is immutable and goes back for

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Speaker 2: the entire history of bitcoin, and it will never really

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Speaker 2: go away. And so if you are trying to launder

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Speaker 2: money or you know, transmit funds that are illicit, it's

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Speaker 2: kind of the worst possible thing for that because, you know,

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Speaker 2: law enforcement they don't even need a warrant. They can

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Speaker 2: just go look at the ledger and the only thing

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Speaker 2: that's really keeping it private in any sense is that

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Speaker 2: they aren't able to connect your bitcoin address to your

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Speaker 2: personal identity, which is something that may have been true

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Speaker 2: in the earlier days when it was easier to obtain bitcoin,

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Speaker 2: you know, you could set up a computer in your

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Speaker 2: basement and mind some bitcoin and no one would know

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Speaker 2: who had just done that. But that's not possible today,

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Speaker 2: and so it's very difficult to obtain bitcoin anonymously and

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Speaker 2: then to maintain that anonymity over and basically indefinite period

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Speaker 2: of time, where if at any point it is connected

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Speaker 2: to you, you are then connected to the crime. If

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Speaker 2: I was a criminal, I don't think I would be

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Speaker 2: choosing bitcoin personally for my money transmission.

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Speaker 1: Let's take a quick break. I'm back with researcher and

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Speaker 1: critic Molly White, who's generously agreed to talk to me

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Speaker 1: on background for my next book, All about the World

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Speaker 1: of Cryptocurrency. I asked her how she explains things like

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Speaker 1: crypto and blockchain to folks who know nothing about such things.

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Speaker 2: Like if they know what a database is, I'll usually

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Speaker 2: say that it's just like a database that is stored

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Speaker 2: among a large group of computers rather than the one

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Speaker 2: single computer, and any activity that happens in that database

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Speaker 2: is recorded permanently and publicly.

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Speaker 1: Which is why this is not a very good tool

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Speaker 1: for illicit financial.

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Speaker 2: Activity, certainly not in my opinion.

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Speaker 1: For a storyteller, bitcoin is a like a wonderful case

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Speaker 1: study in the power of story. If you can make

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Speaker 1: it believable for a bit and you can replace one

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Speaker 1: story with another story and people don't really notice that's

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Speaker 1: what you've done. It's kind of wild how the thing has.

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Speaker 2: Sometimes in the same conversation. Actually, which I've noticed is

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Speaker 2: like I'll be arguing with someone and I'll say something,

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Speaker 2: you know, against what they've just said, and the argument

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Speaker 2: will totally shift, even in sometimes in ways that totally

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Speaker 2: contradict the earlier argument that they were making. It's very strange.

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Speaker 1: Do you find yourself in these arguments?

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Speaker 2: Often I avoid them for the most part. There is

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Speaker 2: no end to the long line of people who think

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Speaker 2: that they can just debate me into being a bitcoin maximalist,

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Speaker 2: and it's like I only have the energy to argue

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Speaker 2: the same thing so many times. On the one end,

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Speaker 2: they're the true believers that are ideologues. They have no strong,

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Speaker 2: you know, interest in the actual financial side of things.

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Speaker 2: They just care about the you know, the principles.

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Speaker 1: And what are those principles that they care about.

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Speaker 2: It depends on the person. But you know, censor resistance, decentralization, immutability,

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Speaker 2: you know, pick your poison, really and then on the

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Speaker 2: other end, there are people who are solely interested in

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Speaker 2: the financial side of things. They have no interest in

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Speaker 2: the ideological side of things. They don't care if it's decentralized,

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Speaker 2: they don't care if it's synonymous, doesn't matter. They just

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Speaker 2: think that the price will go up and they can

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Speaker 2: profit from that. And then I think most people are

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Speaker 2: somewhere in between, and you know, the ideology is very

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Speaker 2: useful as far as promoting the financial side of things

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Speaker 2: and vice versa. I don't think there are that many

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Speaker 2: people who are really the true believers, because I think

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Speaker 2: that the belief system, you know, is actually fairly extreme

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Speaker 2: when you get down to it, especially once you start

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Speaker 2: talking about, you know, hyper bitcoinization, which is like the

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Speaker 2: idea that bitcoin will replace fiit currency as this means

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Speaker 2: of exchange.

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Speaker 1: Are there still people who think that, absolutely, yes, we're

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Speaker 1: there are these.

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Speaker 2: People yelling loudly on Twitter, you.

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Speaker 1: Know, Crypto Twitter is possibly the ugliest part of Twitter

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Speaker 1: I've seen.

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Speaker 2: Yeah, it's brutal, but they, unfortunately are people who have

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Speaker 2: like some amounts of influence. I mean, there there were,

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Speaker 2: especially as the banks were sort of having a crisis moment,

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Speaker 2: there were very influential, wealthy you know, often investor types

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Speaker 2: who were preaching hyperbic cointization. You know, there there's there was,

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Speaker 2: It's a fringe belief, but it is not completely absent.

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Speaker 1: Most of their kind of libertarians. Yes, uh so they're

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Speaker 1: they're very suspicious of centralized authority and government. Probably didn't

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Speaker 1: like their parents.

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Speaker 2: So I think broadly the not to go all like psychoanalyst.

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Speaker 1: But I think that please do.

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Speaker 2: I think a lot of the ideology comes down to

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Speaker 2: a fear of trust where people believe. I think that

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Speaker 2: some people, just generally speaking, believe that people are good

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Speaker 2: and trustworthy, and other people fundamentally believe that everyone is

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Speaker 2: out to you know, screw them over and you can't

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00:24:22,956 --> 00:24:27,996
Speaker 2: trust anybody. And I think that bitcoiners tend to be

437
00:24:28,156 --> 00:24:31,956
Speaker 2: that latter group of people. And that fear that you know,

438
00:24:32,116 --> 00:24:34,676
Speaker 2: society could collapse and they're going to be all on

439
00:24:34,756 --> 00:24:37,676
Speaker 2: their own and they need to stockpile wealth and you know,

440
00:24:38,556 --> 00:24:41,836
Speaker 2: build a bunker and you know, prepare for this sort

441
00:24:41,836 --> 00:24:47,796
Speaker 2: of apocalypse is somewhat common among the true ideologues in bitcoin,

442
00:24:48,356 --> 00:24:50,516
Speaker 2: and so you end up with those types of people,

443
00:24:51,476 --> 00:24:55,676
Speaker 2: you know, predicting the downfall of civilization and bitcoin as

444
00:24:55,716 --> 00:24:58,396
Speaker 2: the way that they will emerge as the kings of

445
00:24:58,436 --> 00:24:59,476
Speaker 2: the new civilization.

446
00:25:00,076 --> 00:25:05,956
Speaker 1: You just described that quintessential bitcoin maximalist religious person. But

447
00:25:06,076 --> 00:25:08,116
Speaker 1: then they blindly trust each other.

448
00:25:09,396 --> 00:25:11,876
Speaker 2: To some extent. I mean, I think that a lot

449
00:25:11,916 --> 00:25:16,276
Speaker 2: of them, do, you know, try to set themselves up

450
00:25:16,276 --> 00:25:19,436
Speaker 2: in ways that don't require that trust. But I also

451
00:25:19,476 --> 00:25:22,036
Speaker 2: think that there is an enormous amount of sort of

452
00:25:22,116 --> 00:25:25,956
Speaker 2: detachment from reality that is required in order to believe that,

453
00:25:26,356 --> 00:25:30,356
Speaker 2: you know, in this total dystopian future where the world

454
00:25:30,356 --> 00:25:33,156
Speaker 2: has melted down and everything is on fire, we're going

455
00:25:33,196 --> 00:25:37,796
Speaker 2: to have reliable internet connections and electricity providers to mine

456
00:25:37,836 --> 00:25:41,996
Speaker 2: bitcoin with, and you know, we'll be able to just

457
00:25:42,356 --> 00:25:45,476
Speaker 2: suddenly move over to using bitcoin for everything.

458
00:25:45,876 --> 00:25:48,996
Speaker 1: I find myself, even if I can go with them

459
00:25:49,116 --> 00:25:52,036
Speaker 1: as far as the world's going to fall apart, I

460
00:25:52,076 --> 00:25:54,756
Speaker 1: find myself stopping before I get to the point of

461
00:25:54,796 --> 00:25:57,516
Speaker 1: wanting to prepare for the world falling apart, because I

462
00:25:57,556 --> 00:25:59,836
Speaker 1: just don't want to live in that world, right, I

463
00:25:59,956 --> 00:26:03,196
Speaker 1: just assume not be here than being a Mad Max movie.

464
00:26:03,356 --> 00:26:05,836
Speaker 2: Well, and if I was going to stockpile things to

465
00:26:05,916 --> 00:26:09,356
Speaker 2: prepare for this world. It would not be bitcoins, be

466
00:26:09,796 --> 00:26:14,756
Speaker 2: seeds and beans and you know things like that.

467
00:26:14,996 --> 00:26:18,036
Speaker 1: Yeah, they're putting all their money into exactly the thing

468
00:26:18,076 --> 00:26:19,556
Speaker 1: that's going to be the most useless.

469
00:26:19,876 --> 00:26:21,596
Speaker 2: It's going to be the first thing to go to zero.

470
00:26:21,756 --> 00:26:25,476
Speaker 1: Yeah, electricity. Yeah, I think you put your finger on it.

471
00:26:25,596 --> 00:26:28,956
Speaker 1: That this idea of a fear of trust or a.

472
00:26:28,916 --> 00:26:31,196
Speaker 2: Belief that trust is fundamentally bad.

473
00:26:31,516 --> 00:26:31,716
Speaker 1: You know.

474
00:26:31,916 --> 00:26:34,476
Speaker 2: That's the other thing that, like, the idea of trustlessness

475
00:26:34,556 --> 00:26:37,396
Speaker 2: is very common in crypto, Like it's great that you

476
00:26:37,396 --> 00:26:40,636
Speaker 2: shouldn't have to trust any intermediary often, you know, to

477
00:26:40,876 --> 00:26:43,036
Speaker 2: to do your financial transaction or whatever it might be.

478
00:26:43,636 --> 00:26:45,996
Speaker 2: But this is all built on the idea that trust

479
00:26:46,196 --> 00:26:50,156
Speaker 2: is a bad thing for a system. And I think

480
00:26:50,196 --> 00:26:53,076
Speaker 2: that society is built on trust, and that a lot

481
00:26:53,116 --> 00:26:55,836
Speaker 2: of the trust that is built into systems like the

482
00:26:55,836 --> 00:26:58,956
Speaker 2: financial system actually gains you a lot. You know, the

483
00:26:58,996 --> 00:27:02,196
Speaker 2: fact that I can trust my bank, that means a

484
00:27:02,236 --> 00:27:04,716
Speaker 2: lot in the financial system, right, it's a lot that

485
00:27:04,756 --> 00:27:06,836
Speaker 2: I don't have to worry about the idea that I

486
00:27:06,876 --> 00:27:10,196
Speaker 2: shouldn't trust a bank means that I also shouldn't you know,

487
00:27:10,476 --> 00:27:13,196
Speaker 2: be able to reverse a credit card transaction. If someone

488
00:27:13,356 --> 00:27:15,196
Speaker 2: you know steals my credit card number.

489
00:27:15,436 --> 00:27:19,876
Speaker 1: I don't mind being ripped off occasionally being the price

490
00:27:20,036 --> 00:27:23,396
Speaker 1: of trusting lots of people, and they are people who

491
00:27:23,396 --> 00:27:25,756
Speaker 1: don't feel that way. I'm trying to remember it now,

492
00:27:25,796 --> 00:27:29,276
Speaker 1: but Satoshi's original paper is sort of like one of

493
00:27:29,276 --> 00:27:31,436
Speaker 1: the big themes is sort of like, we're going to

494
00:27:31,476 --> 00:27:37,156
Speaker 1: build a financial system that doesn't require trust, right right. Weirdly,

495
00:27:38,396 --> 00:27:43,876
Speaker 1: even with cryptocurrency, it quickly starts to build a shadow

496
00:27:43,956 --> 00:27:48,676
Speaker 1: financial system that looks an awful like the real financial

497
00:27:48,716 --> 00:27:53,476
Speaker 1: system without the regulators. But nevertheless, and in this system,

498
00:27:54,036 --> 00:27:57,196
Speaker 1: trust is absolutely essential. I mean, you have to trust

499
00:27:57,276 --> 00:28:00,116
Speaker 1: FTX that they've got your money in FTX. You know,

500
00:28:00,196 --> 00:28:03,596
Speaker 1: all the exchanges are based on this. They're basically crypto

501
00:28:03,676 --> 00:28:06,716
Speaker 1: banks to get born. So it's very odd that this

502
00:28:07,196 --> 00:28:10,796
Speaker 1: technology that was designed to create a trustless world just

503
00:28:10,916 --> 00:28:14,196
Speaker 1: ends up replicating a trust needing world.

504
00:28:14,956 --> 00:28:16,676
Speaker 2: I actually don't think it's odd at all. I think

505
00:28:16,716 --> 00:28:20,316
Speaker 2: it's completely predictable because you know, the reason that people

506
00:28:20,636 --> 00:28:24,036
Speaker 2: decided to build FTX and all the other exchanges is

507
00:28:24,116 --> 00:28:26,796
Speaker 2: because adding just a little bit of trust into the

508
00:28:26,876 --> 00:28:31,676
Speaker 2: system has massive benefits. In a lot of ways. True

509
00:28:31,756 --> 00:28:38,116
Speaker 2: trustlessness is so painful to interact with and to use

510
00:28:38,316 --> 00:28:42,716
Speaker 2: on any basis. It's expensive, it's slow, it's it's just

511
00:28:42,876 --> 00:28:45,396
Speaker 2: not a fun thing to have to deal with it.

512
00:28:45,636 --> 00:28:48,436
Speaker 2: It's pretty predictable, in my opinion, that trust started to

513
00:28:48,476 --> 00:28:50,636
Speaker 2: seep back in. But the problem is that as it

514
00:28:50,756 --> 00:28:54,396
Speaker 2: seeps back in, you know, the safeguards that are built

515
00:28:54,436 --> 00:28:57,436
Speaker 2: into those systems so that we can continue to trust

516
00:28:57,436 --> 00:29:01,516
Speaker 2: them and that that trust isn't abused don't always naturally come,

517
00:29:02,036 --> 00:29:03,836
Speaker 2: you know, right from the get go. It's not like

518
00:29:03,916 --> 00:29:07,356
Speaker 2: banks first emerged with a full suite of banking regulations.

519
00:29:07,356 --> 00:29:12,076
Speaker 2: Those were developed over years, years and years of painful lessons,

520
00:29:12,636 --> 00:29:14,956
Speaker 2: and you know, it seems like the crypto industry is

521
00:29:14,996 --> 00:29:17,516
Speaker 2: going through that same learning experience.

522
00:29:17,756 --> 00:29:21,956
Speaker 1: Are you a trusting person? Absolutely, You're not generally wary.

523
00:29:22,596 --> 00:29:25,996
Speaker 1: You don't trust people out your first step is to trust.

524
00:29:26,796 --> 00:29:29,356
Speaker 2: I wouldn't say I, you know, blindly trust people. But

525
00:29:29,396 --> 00:29:31,396
Speaker 2: if I run into someone on the street, you know,

526
00:29:31,596 --> 00:29:34,876
Speaker 2: broadly speaking, I don't think the likely next move is

527
00:29:34,876 --> 00:29:36,236
Speaker 2: that they're going to punch me in the face and

528
00:29:36,276 --> 00:29:40,556
Speaker 2: steal my wallet. I take the same precautions as anyone

529
00:29:40,676 --> 00:29:42,796
Speaker 2: in today's world where you know, if I get an

530
00:29:42,836 --> 00:29:45,356
Speaker 2: email that promises I've just won five hundred dollars, I

531
00:29:45,396 --> 00:29:47,956
Speaker 2: don't trust that. But I do think that people are

532
00:29:48,076 --> 00:29:52,076
Speaker 2: fundamentally good and you know, work in a cooperative.

533
00:29:51,436 --> 00:29:53,716
Speaker 1: Way, except on crypto Twitter.

534
00:29:54,236 --> 00:29:55,516
Speaker 2: Except on crypto Twitter.

535
00:29:56,316 --> 00:29:59,076
Speaker 1: This was great, and I hope one day I get

536
00:29:59,076 --> 00:30:01,316
Speaker 1: to meet you in person, but I do I really

537
00:30:01,356 --> 00:30:02,156
Speaker 1: appreciate the time.

538
00:30:02,436 --> 00:30:09,236
Speaker 2: Yeah, absolutely, all right, take care bye.

539
00:30:09,756 --> 00:30:13,076
Speaker 1: On Background is hosted by me Michael Lewis and produced

540
00:30:13,116 --> 00:30:17,196
Speaker 1: by Catherine Girardeau and Lydia gene Kott. Our editor is

541
00:30:17,276 --> 00:30:22,676
Speaker 1: Julia Barton. Our engineer is Sarah Bruguier. Thanks to our

542
00:30:22,756 --> 00:30:26,836
Speaker 1: SVP of production, Greta Cone, our show is recorded by

543
00:30:26,916 --> 00:30:31,076
Speaker 1: tofer Ruth at Berkeley Advanced Media Studios. Our music was

544
00:30:31,116 --> 00:30:35,236
Speaker 1: composed by Matthias Bossi and John Evans of Stellwagon Symphonet.

545
00:30:36,236 --> 00:30:39,956
Speaker 1: My old friend Nick Burtel composed our theme song. On

546
00:30:40,116 --> 00:30:44,156
Speaker 1: Background is a production of Pushkin Industries. Don't forget that

547
00:30:44,196 --> 00:30:47,996
Speaker 1: we have a website atr podcast dot com in case

548
00:30:47,996 --> 00:30:49,916
Speaker 1: you want to send me a question or a complaint

549
00:30:50,196 --> 00:30:52,556
Speaker 1: or anything at all. I'll read the questions. I won't

550
00:30:52,556 --> 00:30:57,516
Speaker 1: read the complaints. That's atr podcast dot com. To find

551
00:30:57,516 --> 00:31:02,196
Speaker 1: more Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts,

552
00:31:02,556 --> 00:31:05,396
Speaker 1: or wherever you listen to podcasts. And if you'd like

553
00:31:05,476 --> 00:31:09,116
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554
00:31:09,796 --> 00:31:12,156
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555
00:31:12,516 --> 00:31:17,156
Speaker 1: at pushkin dot fm, Backslash Plus, or on our Apple

556
00:31:17,196 --> 00:31:24,596
Speaker 1: show page. What did you edit on the unicycle Wikipedia page?

557
00:31:25,556 --> 00:31:29,796
Speaker 2: I'm pretty sure that I added information about the existence

558
00:31:29,996 --> 00:31:33,436
Speaker 2: of other types of unicycles. You know, so there's like

559
00:31:33,516 --> 00:31:36,756
Speaker 2: the very standard unicycle, but there's also ones that like

560
00:31:37,156 --> 00:31:41,276
Speaker 2: arement for going off road, and there are ones that

561
00:31:41,316 --> 00:31:44,556
Speaker 2: have like really big wheels that let you go long distance.

562
00:31:44,876 --> 00:31:49,996
Speaker 1: You know. An off road unicycle is to cycling what

563
00:31:50,596 --> 00:31:53,436
Speaker 1: bitcoin is to money. It's sort of, it's sort of

564
00:31:53,956 --> 00:31:57,116
Speaker 1: it's sort of like a solution in search of the problem.

565
00:31:57,476 --> 00:31:58,196
Speaker 2: Absolutely