WEBVTT - Talking with Omid Malekan - Trust has been lost, here's how to restore it 0:00:00.040 --> 0:00:02.240 All right, welcome back. You are listening to another episode 0:00:02.240 --> 0:00:05.160 of the markma Show where we talk about the decentralized revolution, 0:00:05.240 --> 0:00:08.920 the way the world is changing from centralization to decentralization. 0:00:09.280 --> 0:00:11.800 Of course, we look at it through the lens of politics, finance, 0:00:11.920 --> 0:00:15.600 and technology. Technology is the catalyst that changes the world 0:00:15.600 --> 0:00:17.720 through thousands of years of history, and of course we 0:00:17.840 --> 0:00:20.560 have the decentralized technology of bitcoin that has changed in 0:00:20.560 --> 0:00:23.600 the world. We're gonna dig into a topic. Like I said, 0:00:23.640 --> 0:00:25.680 I like to look at it from the lens of politics, finance, 0:00:25.720 --> 0:00:29.920 and technology, and today it's really all three combined that 0:00:30.000 --> 0:00:34.400 are under attack. And I'm joined in studio by Ohmid Malikan. 0:00:34.680 --> 0:00:36.560 If I said that right, you can find him on 0:00:36.600 --> 0:00:39.520 Twitter at Malik Anam's will put it in the show 0:00:39.560 --> 0:00:42.040 link down below. He's the author of a book called 0:00:42.200 --> 0:00:45.440 re Architecting Trust, which, of course, to be watching my 0:00:45.440 --> 0:00:46.919 show is something I talked about a lot, and he's 0:00:46.960 --> 0:00:50.919 the adjunct professor at Columbia Business School as well. Oh Man, 0:00:50.960 --> 0:00:53.240 thanks so much for joining me today. Thanks for having 0:00:53.280 --> 0:00:55.720 me so. You know, I like to look at the 0:00:55.760 --> 0:00:58.720 world changing through the lens of the politics, finance, and technology, 0:00:58.760 --> 0:01:02.440 and this one issue specifically, and we'll talk about today, 0:01:02.560 --> 0:01:05.959 is really all three of those. It's a political method 0:01:06.200 --> 0:01:09.760 attacking um source of some sort of technology that kind 0:01:09.800 --> 0:01:13.440 of masquerades as a as a financial thing. And it 0:01:13.480 --> 0:01:16.240 was you know, all of the Treasury Secretary, you know, 0:01:16.280 --> 0:01:18.559 the Treasury Department. I mean, it's all three of those, 0:01:19.000 --> 0:01:20.959 um and and it's something you've been talking about quite 0:01:21.000 --> 0:01:23.560 a bit um And of course we're talking about Tornado cash. 0:01:23.600 --> 0:01:25.120 Why don't you kind of frame that up for us 0:01:25.120 --> 0:01:29.479 a little bit? So one thing that not enough people 0:01:29.600 --> 0:01:33.959 recognize or appreciate is the fact that in crypto, full 0:01:34.000 --> 0:01:37.600 transparency is the default state, which is definitely not true, 0:01:37.640 --> 0:01:39.959 would say the banking system. Right, like you and I 0:01:40.040 --> 0:01:44.040 do a bitcoin transaction, we both now see each other's 0:01:44.080 --> 0:01:49.320 the entire financial history, which is great from a security 0:01:49.440 --> 0:01:53.720 point of view. But then, uh, if this technology and 0:01:53.760 --> 0:01:56.680 new financial system is to go mainstream, then it's not 0:01:56.720 --> 0:01:58.480 really gonna work, right, Like, you can't have it that 0:01:58.680 --> 0:02:01.200 every time you want to make a donation to a 0:02:01.280 --> 0:02:04.240 charity or your company is paying you in crypto, now 0:02:04.280 --> 0:02:07.920 suddenly you've exposed your wallet address that has your everything, right, 0:02:07.960 --> 0:02:10.320 And I think like on a long enough timeline, it. 0:02:10.720 --> 0:02:13.560 Your wallet will have your everything, your money, your stocks, 0:02:13.560 --> 0:02:15.440 your n f T s, maybe the d to your house, 0:02:15.440 --> 0:02:19.080 et cetera. So Tornado Cash for Me has actually a 0:02:19.200 --> 0:02:22.720 very innocuous use, which is to just restore a basic 0:02:22.720 --> 0:02:25.919 amount of financial privacy, which I think most people would 0:02:25.919 --> 0:02:29.440 agree is a good thing. And what was so troubling 0:02:29.639 --> 0:02:34.560 about the U. S. Government adding it to the sanctions 0:02:34.639 --> 0:02:39.000 list was the fact that they were not criminalizing people 0:02:39.120 --> 0:02:42.720 doing committing an actual crime like funding North Korea or 0:02:42.880 --> 0:02:48.520 terrorists or something. They are now criminalizing the mere act 0:02:48.800 --> 0:02:54.440 of seeking financial privacy. And I think the connotations for that, 0:02:54.600 --> 0:02:58.040 the dangerous connotations for that move are actually much bigger 0:02:58.040 --> 0:03:01.440 than crypto. Uh yeah, I would say that. I would. 0:03:01.480 --> 0:03:05.760 I would even say, um, maybe it's even bigger than that. 0:03:06.200 --> 0:03:08.920 So the problem that we have is when we have 0:03:09.760 --> 0:03:13.400 I consider bitcoin to be a technological revolution, not a 0:03:13.400 --> 0:03:16.200 new technology. And the difference of that is a new 0:03:16.240 --> 0:03:20.320 technology is cool, it's a it's a continuation of something. Uh. 0:03:20.320 --> 0:03:22.600 An iPhone is a new technology. We took a computer phone, 0:03:22.639 --> 0:03:25.320 we put them together. That's cool, great. Um a technology 0:03:25.360 --> 0:03:29.000 technological revolution is different, it's bigger. There's been five of them. Um, 0:03:29.040 --> 0:03:35.000 so industrial revolution, steam engines, railways, electricity and steel, um oil, automobiles, 0:03:35.080 --> 0:03:39.800 microprocessors and when humans we are not good at seeing 0:03:39.840 --> 0:03:42.320 the future, so we try to understand it from something 0:03:42.320 --> 0:03:45.600 that we already know. So, like when electricity was invented, 0:03:45.640 --> 0:03:48.840 what was the first application of electricity? It was a 0:03:48.920 --> 0:03:53.080 light bulb? Right, So what is this electricity thing here? Omitt, Oh, 0:03:53.120 --> 0:03:55.720 well it's kind of like a digital candle. What the 0:03:55.800 --> 0:03:57.360 hell do we need that for? Candles have been light 0:03:57.400 --> 0:04:00.480 for five thousand years? Right, Um, we don't them. We 0:04:00.520 --> 0:04:03.280 don't need all these stupid wires. We just have a candle. Well, 0:04:03.360 --> 0:04:07.600 electricity was like that, but it became so much more. 0:04:08.160 --> 0:04:09.680 And so the problem that I have is I think 0:04:09.720 --> 0:04:13.720 this is something so revolutionary. Um, all new technology has 0:04:13.760 --> 0:04:17.520 the first killer application, like the Internet. The first killer 0:04:17.560 --> 0:04:20.640 application of the Internet was email. That's what got everybody addicted. 0:04:21.360 --> 0:04:23.800 But now we use it to like have my car, 0:04:24.120 --> 0:04:26.640 use AI to navigate me around traffic, using social media 0:04:26.720 --> 0:04:29.600 or something right like. And so when we say that 0:04:29.640 --> 0:04:33.320 it's an attack, it's an attack on software, it's attack 0:04:33.360 --> 0:04:37.520 on financial privacy, but it's really it's it's an attack 0:04:37.520 --> 0:04:42.640 on software. I think maybe because if if it's only financial, 0:04:42.720 --> 0:04:45.840 then that limits the really the grasp of what software 0:04:45.920 --> 0:04:47.960 really could do. Maybe I don't know if that matters 0:04:47.960 --> 0:04:51.560 for what you're thinking. It does actually in part because 0:04:51.839 --> 0:04:55.839 the I like your framing of crypto really being a 0:04:55.880 --> 0:04:58.880 financial revolution, because the idea of a revolution is not 0:04:58.960 --> 0:05:04.080 just not just financi right, sorry, a a revolution technological 0:05:04.279 --> 0:05:09.960 and and even application wise, go bigger. Like my the 0:05:10.000 --> 0:05:12.120 book I wrote is really a book about trust, because 0:05:12.760 --> 0:05:16.240 trust matters in everything that's important in life, and that 0:05:16.279 --> 0:05:19.440 includes finance, but it also includes something like a social 0:05:19.480 --> 0:05:22.520 media platform, like you're gonna go on Twitter, Facebook, how 0:05:22.520 --> 0:05:24.479 do you trust what they're showing you? How do you 0:05:24.520 --> 0:05:27.680 trust that they're not gonna suddenly cancel you if you 0:05:27.720 --> 0:05:31.640 say something that's politically not fashionable. Um, and the and 0:05:31.720 --> 0:05:34.640 the risk. The list goes on and on from there. 0:05:34.720 --> 0:05:38.680 So I've spent years trying to figure out how to 0:05:38.920 --> 0:05:42.800 communicate the core value proposition of crypto to people who 0:05:42.839 --> 0:05:46.360 are not technologists, they're not financed people, they're not traders, 0:05:46.480 --> 0:05:49.159 And the one thing that I found resonates is to 0:05:49.279 --> 0:05:52.719 just tell them that this is a new and better 0:05:52.800 --> 0:05:57.640 way to build trust among communities of people and the 0:05:57.680 --> 0:06:01.799 applications of that to me are end us, which means 0:06:01.800 --> 0:06:04.680 that if you have something like an arm of the U. S. 0:06:04.720 --> 0:06:08.960 Government trying to really clamp down on it, then the 0:06:09.080 --> 0:06:11.919 limitations that they're going to impose on all the benefits 0:06:11.920 --> 0:06:17.160 are also endless. Yeah. Definitely. Yeah, So it's definitely trust lists, right, 0:06:17.200 --> 0:06:19.560 so instead of having to trust this third party central 0:06:20.440 --> 0:06:24.040 in a mary, um, now we don't have to trust anybody. 0:06:24.360 --> 0:06:25.800 But the reason why I wanted to take it like 0:06:25.880 --> 0:06:29.000 one level higher was because of really what I think 0:06:29.040 --> 0:06:32.840 the implications are. Because if you're saying, well, they're trying 0:06:32.839 --> 0:06:36.320 to take away people's right to financial privacy, which is true, 0:06:37.000 --> 0:06:40.120 But I think what they've done is to the point 0:06:40.160 --> 0:06:42.920 that you made earlier. Um, what they've done is they've 0:06:43.080 --> 0:06:46.960 sanctioned a software protocol, which has never been done before. 0:06:47.520 --> 0:06:51.440 So they typically would sanction a person or maybe a country, 0:06:51.480 --> 0:06:53.720 but that person should have some sort of due process 0:06:53.720 --> 0:06:56.239 and should have a right to probably appeal that or something. 0:06:56.279 --> 0:06:58.839 As a matter of fact, I believe on the sanctioned 0:06:58.839 --> 0:07:00.880 list there's a link where you can actually appeal to 0:07:00.920 --> 0:07:02.760 get taken off of that list. But how does the 0:07:02.800 --> 0:07:07.000 software protocol have due process? How do they appeal that. 0:07:07.000 --> 0:07:10.360 That's a great point. They can't, which is kind of 0:07:10.400 --> 0:07:13.000 the scary part of this, right, because once you expand 0:07:13.160 --> 0:07:18.400 the sanction ability to code and language and maybe even 0:07:18.440 --> 0:07:22.559 physical devices, then the skies the limit, right, Like, yes, 0:07:23.200 --> 0:07:25.800 I am sure bad people have used Tornado cash, but 0:07:25.840 --> 0:07:31.640 bad people I also use the Internet and iPhones and flashlights. 0:07:32.520 --> 0:07:35.480 So this is one of those instances where I think 0:07:35.520 --> 0:07:41.080 the slippery slope argument is very applicable. Yeah. Yeah, we 0:07:41.080 --> 0:07:46.640 we have laws against doing certain things. Um, so if 0:07:46.680 --> 0:07:49.400 you commit murder, obviously we have a law against that. 0:07:49.600 --> 0:07:52.000 But if you drove a car on the highway to 0:07:52.080 --> 0:07:56.520 commit that murder, you don't sanction the highway, right, you 0:07:56.560 --> 0:07:58.680 don't sancs in the car. We have cars, we have 0:07:58.760 --> 0:08:02.440 we have highways. I bet that that killer probably drank 0:08:02.480 --> 0:08:04.800 some water before he went there too, we don't sanction 0:08:04.800 --> 0:08:08.040 the water, right. Um, what what he did was illegal, 0:08:08.080 --> 0:08:09.600 and so we look at it in those terms. And 0:08:09.640 --> 0:08:11.200 so I was just trying to look at it from 0:08:11.200 --> 0:08:15.200 a bigger standpoint because what I'm afraid is like, um, 0:08:15.240 --> 0:08:19.520 what about you know signal on my phone or tour 0:08:20.200 --> 0:08:23.520 uh tour for my you know internet? Right, So what 0:08:23.560 --> 0:08:26.160 it's doing is it's a it's I don't even know 0:08:26.160 --> 0:08:28.640 if it's a mixing service so much, but it's a 0:08:28.640 --> 0:08:31.000 way that we can kind of like hot blend in 0:08:31.040 --> 0:08:33.880 with a bigger transactions. But that's exactly what tore does. 0:08:34.120 --> 0:08:37.880 It blends my internet surfing together or sit you know. Um, 0:08:37.960 --> 0:08:40.040 and if you if you start sanctioning that, that has 0:08:40.240 --> 0:08:45.040 massive implications. Yeah. And it's not just tour I mean, 0:08:45.080 --> 0:08:47.400 if you're talking about software and language, then yes, but 0:08:47.559 --> 0:08:50.000 like why do we have blinds and curtains on our windows? 0:08:50.800 --> 0:08:54.400 Why why do we have doors for bathrooms? It's it's 0:08:54.440 --> 0:08:58.520 to me privacy is one of the most fundamental human 0:08:58.640 --> 0:09:01.440 rights because any person, you mean, it doesn't matter whether 0:09:01.520 --> 0:09:05.120 political discvision, this position is there are things about themselves 0:09:05.200 --> 0:09:07.760 that they don't want the world to know. Yeah. I 0:09:07.800 --> 0:09:09.280 love that thought. I want to I want to come 0:09:09.280 --> 0:09:10.840 back to that. I want to get back to this 0:09:10.880 --> 0:09:13.480 privacy and trust issue. We'll talk about your book. I'm 0:09:13.480 --> 0:09:16.480 in the studio with Ohmd Molikan. We're talking about the 0:09:16.520 --> 0:09:18.760 death of trust, something to talk a lot about. Of course, 0:09:18.760 --> 0:09:20.679 you're listening to the Mark Moa show talking about the 0:09:20.720 --> 0:09:24.560 decentralized Revolution. I'm gonna be back with this conversation and 0:09:24.600 --> 0:09:26.120 more in a minute. So don't go away, We'll be 0:09:26.200 --> 0:09:29.000 right back. All right, welcome back. You are listening to 0:09:29.080 --> 0:09:31.920 the Mark mo Show talking about the decentralized revolution, the 0:09:31.920 --> 0:09:34.760 way the world is changing through the lens of politics, finance, 0:09:34.800 --> 0:09:37.400 and technology. I'm in the studio with Ohmd Molikan. He's 0:09:37.440 --> 0:09:40.200 the UM author of a book called re Architect and 0:09:40.200 --> 0:09:44.559 trust Agent, professor at Columbia Business School. Let's um, we 0:09:44.800 --> 0:09:47.480 were talking before the break about you know what happened 0:09:47.480 --> 0:09:49.960 and the sanctions against the software protocol what that means. 0:09:50.160 --> 0:09:52.360 Let's just jump even back to a higher level. So 0:09:52.440 --> 0:09:55.079 before we went on the break, you were talking about, um, 0:09:55.080 --> 0:09:57.640 why do we have curtains on our home? Why don't 0:09:57.640 --> 0:09:59.440 we have doors in our bathroom? A lot of people 0:09:59.520 --> 0:10:01.560 might say, well, if you don't have anything to hide, 0:10:01.880 --> 0:10:04.200 what you need privacy for? And I would love to 0:10:04.240 --> 0:10:06.520 find one person like in real life that would actually 0:10:06.559 --> 0:10:07.719 say that. And then I would say, well give me 0:10:07.760 --> 0:10:09.559 your phone, let me let me stroll through your phone. 0:10:10.000 --> 0:10:14.000 Like nobody would do that, right, Like they wouldn't do that. Um, 0:10:14.040 --> 0:10:16.480 but let's jump to a little higher level. And when 0:10:16.480 --> 0:10:19.920 you wrote the book re Architect, and trust. Um, how 0:10:20.000 --> 0:10:22.720 does this issue with trust and privacy? How do you 0:10:22.920 --> 0:10:25.840 see those two things were kind of working together. So 0:10:25.880 --> 0:10:28.640 there's this The interesting thing about trust is that there 0:10:28.720 --> 0:10:33.160 is this cyclicality to it. And uh, you alluded to something. 0:10:33.400 --> 0:10:36.360 I think it was earlier this year at the Bigcoin conference, 0:10:36.480 --> 0:10:40.640 after the UM what happened with Russian sanctions and the 0:10:40.679 --> 0:10:44.400 Canadian truckers that they don't We're witnessing the loss of 0:10:44.480 --> 0:10:47.400 trust and then you reach a point of no return 0:10:47.400 --> 0:10:51.160 where the whole thing falls apart, and I try to 0:10:51.240 --> 0:10:54.080 build out allegorically this thesis in the book that the 0:10:54.080 --> 0:10:56.040 funny thing about trust is that in the long run 0:10:56.080 --> 0:10:59.960 it's always self defeating. You know, the more trust people 0:11:00.200 --> 0:11:03.719 put in a person, a company, a government and institution, 0:11:04.240 --> 0:11:06.920 then the more likely it becomes to abuse that trust 0:11:06.920 --> 0:11:09.160 in the long run. Right, And like a simple example 0:11:09.160 --> 0:11:11.000 of that is we had a guy like Bernie made Off, 0:11:11.040 --> 0:11:15.880 who was actually considered a very clean, respected man on 0:11:15.960 --> 0:11:18.839 Wall Street, and because of that, no one bothered to 0:11:18.960 --> 0:11:21.360 double check what he was doing. If it was just 0:11:21.440 --> 0:11:23.880 you and me trying to do what he was doing, 0:11:23.920 --> 0:11:26.040 then probably people would have been a lot more suspicious 0:11:26.040 --> 0:11:28.640 and skeptical and not that we would do a Ponzi scheme, 0:11:28.679 --> 0:11:30.960 but we couldn't get away with it even if we 0:11:31.080 --> 0:11:35.800 wanted to. So history is rife with examples and I 0:11:35.840 --> 0:11:39.640 have many of them in the book where someone does 0:11:39.720 --> 0:11:43.000 something good, becomes in a position where we trust them, 0:11:43.280 --> 0:11:45.480 and then they slowly begin to abuse that trust for 0:11:45.520 --> 0:11:48.440 the simple reason that they can. And that's why trust 0:11:48.520 --> 0:11:52.080 is always cyclical. So in the example that we're talking about, 0:11:52.840 --> 0:11:56.480 one of the reasons why the dollar is the global 0:11:56.520 --> 0:11:59.880 reserve currency and frankly why America is the most powerful 0:12:00.040 --> 0:12:03.240 country in the world in many ways, the most um 0:12:03.440 --> 0:12:06.720 desirable country roles for people to interact with and living 0:12:07.080 --> 0:12:10.120 is because of trust. Because our system, our laws, and 0:12:10.200 --> 0:12:15.160 historically our system of money was one that was predictable. 0:12:15.480 --> 0:12:18.280 There were rules. We followed our own rules, even when 0:12:18.320 --> 0:12:21.000 it harmed us and what's been happening. And we had 0:12:21.000 --> 0:12:22.840 a rule of law. That's the big thing that you're saying. 0:12:22.880 --> 0:12:25.000 We had a rule of law. Other nations they seize 0:12:25.000 --> 0:12:27.120 people's stuff whatever the no rule of law. We had 0:12:27.160 --> 0:12:29.200 that here people could trust that there would be a 0:12:29.240 --> 0:12:33.200 rule of law. Yeah, and historically, specifically, if you want 0:12:33.200 --> 0:12:36.920 to be the issuer of a global reserve currency, then 0:12:37.080 --> 0:12:42.280 having a reliable legal system is a requirement. Um, that's why, 0:12:42.360 --> 0:12:45.960 like today, China is one of the biggest economies in 0:12:45.960 --> 0:12:48.719 the world, the biggest country by population, nobody uses its 0:12:48.720 --> 0:12:52.400 currency for international trade because they don't trust its legal system. 0:12:52.400 --> 0:12:56.560 So it's troubling with Tornado. And then before that, what 0:12:56.800 --> 0:13:00.440 happened with Russian sanctions. And I know the Canadian truckers 0:13:00.559 --> 0:13:02.559 was Canadian, but it's actually not hard for me to 0:13:02.600 --> 0:13:05.800 imagine the same thing happening here in America is that 0:13:06.040 --> 0:13:09.160 we are starting to abuse that trust. We're starting to 0:13:09.280 --> 0:13:12.800 go back on our own values of the rule of law. 0:13:12.840 --> 0:13:15.679 And I think for Americans like me and you, this 0:13:15.760 --> 0:13:19.880 is going to have negative consequences down the road. What 0:13:20.000 --> 0:13:22.600 about I mean, one thing that really shook me hard 0:13:23.000 --> 0:13:28.480 was the highest branch of government, well one of the 0:13:28.480 --> 0:13:34.199 three branches of government, that the Supreme Court had information leaked, 0:13:34.280 --> 0:13:39.040 the most sacred body in the United States, the Supreme 0:13:39.120 --> 0:13:44.079 Court had information leak that was obviously one side, very partisan, 0:13:44.200 --> 0:13:46.880 that was specifically leaked for a very specific purpose that 0:13:46.920 --> 0:13:50.760 was an attack on the highest union. And then and 0:13:50.800 --> 0:13:54.440 then not to be outdone, California, then, um, they were 0:13:54.440 --> 0:13:57.160 mad because the Supreme Court had also overturned some gun 0:13:57.240 --> 0:14:02.480 rights laws, and the California governor and the head the 0:14:02.480 --> 0:14:05.440 head of the Justice Department said, um, that we're going 0:14:05.480 --> 0:14:08.200 to come back and fight against this with everything that 0:14:08.240 --> 0:14:12.520 we have. And then a week later, os we just 0:14:12.640 --> 0:14:15.800 leaked all the names of all our concealed permit like 0:14:15.920 --> 0:14:18.320 so not on the Supreme Court, and then the Department 0:14:18.360 --> 0:14:21.160 of Justice in California just accidentally leaked it after they 0:14:21.240 --> 0:14:24.520 vowed to get vengeance, Like those are the highest level. 0:14:24.640 --> 0:14:28.040 If we can't trust the courts and the Justice Department, 0:14:28.480 --> 0:14:31.960 what does that say about trust? Yeah? Unfortunately, these are 0:14:31.960 --> 0:14:36.520 examples of a continuing trend that we're all experiencing in America, 0:14:36.560 --> 0:14:39.440 and I think it's actually like the scariest part of 0:14:39.480 --> 0:14:42.960 it to me is that it's totally bipartisan. The kind 0:14:42.960 --> 0:14:47.640 of things that trouble someone like me, like violating the 0:14:47.760 --> 0:14:50.680 rule of law and some of these slippery slope examples 0:14:50.680 --> 0:14:54.200 with things like financial crimes. Uh, these are the things 0:14:54.240 --> 0:14:58.480 that seemed to be happening on both sides, and the 0:14:58.560 --> 0:15:00.960 result is what we're seeing today, which is that people 0:15:01.080 --> 0:15:05.080 increasingly don't trust their government, and then by extension, don't 0:15:05.080 --> 0:15:09.000 trust each other. So it's cyclical. I like how you 0:15:09.040 --> 0:15:10.920 frame that up. I hadn't really thought about it like that. 0:15:11.840 --> 0:15:13.600 And the problem is that we have human nature that's 0:15:13.600 --> 0:15:16.280 always involved, and so that's kind of like to your point, right, 0:15:16.600 --> 0:15:18.840 that's the same reason why, in my opinion, we can't 0:15:18.880 --> 0:15:22.560 have humans controlling money. Not one should control money. UM. 0:15:22.720 --> 0:15:25.480 And so back to trust. So gold had been money 0:15:25.480 --> 0:15:28.440 for five thousand years. UM. They said, hey, gold doesn't 0:15:28.520 --> 0:15:30.720 have enough velocity. We can't move it fast enough. So 0:15:30.760 --> 0:15:32.960 if we put the gold into the bank, UM will 0:15:33.000 --> 0:15:34.560 issue debt on top of it. So you have a 0:15:34.560 --> 0:15:37.920 paper goal stificate and IOU and we'll hold the gold. 0:15:38.040 --> 0:15:39.480 You have the I O U s and then whatever 0:15:39.520 --> 0:15:41.120 you want, you can just redeem them. And so people 0:15:41.160 --> 0:15:43.760 trusted that. But then they printed too many of those 0:15:43.800 --> 0:15:46.480 paper goals stificates and so by nine thirty three the 0:15:46.520 --> 0:15:49.240 government owed more gold than they had. So they said, well, 0:15:49.280 --> 0:15:50.880 here's what we do. Well, just seize all the gold. 0:15:51.080 --> 0:15:53.320 So they seized all the gold, and then after they 0:15:53.360 --> 0:15:55.760 seized it all, then they revalued it. So not only 0:15:55.800 --> 0:15:57.560 do they seize your gold, then they stole your wealth. 0:15:58.240 --> 0:16:00.440 So that was a big blow to trust it. Somehow 0:16:00.480 --> 0:16:03.680 people still trusted I don't know how UM. And then 0:16:04.600 --> 0:16:07.480 one comes along and they say, oh, now we're just 0:16:07.520 --> 0:16:09.440 going to default to the whole world on the goal 0:16:09.520 --> 0:16:12.360 that we owed up. I guess you know, are bad. 0:16:13.120 --> 0:16:16.520 Like like, it seems like that the death of trust 0:16:16.560 --> 0:16:19.000 has been coming, coming, coming, coming. Do you think at 0:16:19.040 --> 0:16:21.200 some point, like it's cyclical, like, where does it, like 0:16:21.520 --> 0:16:24.440 UM come to a head? At some point, you could 0:16:24.480 --> 0:16:26.640 argue it comes to a head with the inflation that 0:16:26.680 --> 0:16:29.840 we're starting to see in almost every country in the 0:16:29.840 --> 0:16:34.040 world now. And part of the reason why is, by 0:16:34.040 --> 0:16:38.360 the way excellent history of money there. That's chapter one 0:16:38.360 --> 0:16:42.640 of my book UM. When you tether your currency from 0:16:42.680 --> 0:16:47.000 any form of discipline, like having it be backed by something. 0:16:47.360 --> 0:16:50.920 It could be gold, could be anything, could be bitcoin, UM, 0:16:51.000 --> 0:16:54.640 then you end up in situations with every subsequent crisis 0:16:54.720 --> 0:16:57.200 where the central bank is like, oh, well, you know, 0:16:57.240 --> 0:17:00.320 we can fix this by just printing a trillion dollars. 0:17:00.440 --> 0:17:02.720 But then the next time around it you need to trillion, 0:17:02.960 --> 0:17:04.840 and then the next time around you need a trillion. 0:17:05.320 --> 0:17:09.520 And then you also have people in UM politics saying, oh, well, 0:17:09.520 --> 0:17:11.520 if we're printing all this money, here's a list of 0:17:11.680 --> 0:17:13.719 causes that are near and dear in my heart. Can 0:17:13.760 --> 0:17:18.600 you please print money to fix them? Yeah, exactly. So 0:17:19.080 --> 0:17:21.159 I'd like to keep chasing this thread with you a 0:17:21.200 --> 0:17:24.399 little bit because, um, in my opinion, as we I 0:17:24.480 --> 0:17:26.680 kind of both just agree to it's it's humans. It's 0:17:26.680 --> 0:17:31.920 just human nature. And uh, centralization leads to manipulation and 0:17:32.040 --> 0:17:33.919 something I like to say, And so the more power 0:17:33.920 --> 0:17:35.720 and control you give me, the more I'm just gonna 0:17:35.800 --> 0:17:38.840 probably start trying to manipulate that a little bit to 0:17:38.920 --> 0:17:41.320 my favor, of course. But then so at some point 0:17:41.359 --> 0:17:42.840 it seems like there must come to a head if 0:17:42.840 --> 0:17:45.560 it's cyclical, and then it starts over again. So I 0:17:45.600 --> 0:17:47.240 want to chase that through with you a little bit. 0:17:47.320 --> 0:17:49.040 When we get back. You're listening to the Markma Show. 0:17:49.080 --> 0:17:52.240 We're talking about the decentralized Revolution, the way the pendulum 0:17:52.320 --> 0:17:55.040 is swinging from centralization to decentralization, looking at through the 0:17:55.080 --> 0:17:58.040 lens of politics, finance, and technology. I'm in the studio 0:17:58.080 --> 0:18:01.359 with Ohmed Moli Khan, the author of re Architecting Trust. 0:18:01.400 --> 0:18:02.960 We got a lot more to cover when we come back. 0:18:03.359 --> 0:18:05.960 Don't go away, We'll be right back, all right. Welcome back, 0:18:06.000 --> 0:18:08.480 you are listening to the Mark Moa show. We're talking about, 0:18:08.760 --> 0:18:11.080 of course, each and every week, the decentralized revolution, the 0:18:11.080 --> 0:18:13.760 way the world is changing through the lens of politics, finance, 0:18:13.760 --> 0:18:17.600 and technology. Of course technology being that big piece which 0:18:17.880 --> 0:18:20.199 I'm in the studio talking with Ohmed Moli Khan, the 0:18:20.280 --> 0:18:22.480 author of re Architecting Trust, and I think we're gonna 0:18:22.480 --> 0:18:25.520 come back and pin technology on fixing this. But let's 0:18:25.560 --> 0:18:28.320 see where we go with this. So, um, you're you 0:18:28.359 --> 0:18:30.600 said how trust is cyclical, and I hadn't really thought 0:18:30.600 --> 0:18:32.440 about it like that before, so it's kind of new. 0:18:32.440 --> 0:18:35.280 I'm thinking through this as we're talking, and I can 0:18:35.359 --> 0:18:38.080 understand how you're saying. The more we give trust to somebody, 0:18:38.119 --> 0:18:41.439 the more it gets violated or manipulated, and then at 0:18:41.480 --> 0:18:43.639 some point it breaks, and then I guess it starts 0:18:43.680 --> 0:18:46.960 over again. So, um, I don't trust my business partner anymore. 0:18:47.280 --> 0:18:50.080 I probably will never trust him again, but maybe at 0:18:50.080 --> 0:18:51.960 some point I'll go get a new business partner and 0:18:51.960 --> 0:18:55.199 I'll trust them, right, But then, like, um, you know, 0:18:55.240 --> 0:18:57.199 I won't trust my wife again if she cheats on me, 0:18:57.240 --> 0:18:59.360 but I'll probably get married again at some point, right 0:19:00.000 --> 0:19:02.840 to be That's how it starts. UM. But then if 0:19:02.880 --> 0:19:05.520 I think about it, like there's a lot of nations, 0:19:05.920 --> 0:19:07.720 most of the nations in this world who don't have 0:19:07.800 --> 0:19:10.560 a good rule of law. We're about we're kind of 0:19:10.600 --> 0:19:13.240 in that bend today, But um, these nations don't seem 0:19:13.280 --> 0:19:16.720 to restart, like trust never gets re established in China 0:19:16.880 --> 0:19:20.919 or Iran or Lebanon. So how do you see that 0:19:20.920 --> 0:19:23.560 cyclicality kind of playing out in the environment that we're in. 0:19:24.200 --> 0:19:27.960 If you go back historically long enough, then you could 0:19:28.000 --> 0:19:30.480 argue that even in those countries, like there were times 0:19:30.480 --> 0:19:33.120 where they were the high trust societies and say like 0:19:33.280 --> 0:19:36.960 the West was not UM. And one of the interesting things, 0:19:37.400 --> 0:19:41.320 since we were talking about in the previous segment technological revolutions, 0:19:42.400 --> 0:19:45.360 the one thing that those always trend in one direction 0:19:45.440 --> 0:19:48.960 are the interesting ways that people built and invent new 0:19:49.000 --> 0:19:52.959 technologies to become better at building trust. So even any 0:19:53.040 --> 0:19:57.040 examples that you gave, like with your business partner, UM, 0:19:57.320 --> 0:20:00.520 one example of a technology that will hopefully help you 0:20:00.640 --> 0:20:03.960 regain trust with the future business partner is a contract. 0:20:05.040 --> 0:20:09.680 Contracts to me were a technological innovation UM invented to 0:20:09.720 --> 0:20:14.440 solve the problem of trust, and in ancient times they 0:20:14.480 --> 0:20:16.240 had this problem of like, how do we even know 0:20:16.280 --> 0:20:18.879 if the thing is authentic? So they would do in 0:20:18.880 --> 0:20:21.960 the Middle Ages this crazy thing where they would write 0:20:22.000 --> 0:20:24.119 two copies of the contract on the same piece of 0:20:24.160 --> 0:20:26.800 paper and then they just tear it in half and 0:20:26.840 --> 0:20:30.200 each party we get one half and when they got 0:20:30.200 --> 0:20:33.280 together in the future, if the teeth lined up, then 0:20:33.280 --> 0:20:36.720 it was an official contract. It wasn't a forgery. And that, 0:20:36.800 --> 0:20:39.119 by the way, is the word where the word indenture 0:20:39.200 --> 0:20:42.960 comes from from the Latin for dente or teeth. So 0:20:43.520 --> 0:20:48.119 people have been doing this forever basically, And UM, to me, 0:20:48.160 --> 0:20:52.199 a simple way to understand blockchain and crypto is the 0:20:52.280 --> 0:20:57.199 latest technological innovation in order to achieve trust, particularly in 0:20:57.400 --> 0:21:02.720 a digital and global setting. I like that answer, And 0:21:02.760 --> 0:21:04.920 that's that's exactly the way that I see it. It's 0:21:04.960 --> 0:21:07.040 and that's kind of what I said at my I 0:21:07.119 --> 0:21:09.320 was talking about my my talk at bitcoin at the 0:21:09.359 --> 0:21:11.879 Bitcoin conference, and I said, UM, it's almost like we 0:21:11.960 --> 0:21:15.800 need a decentralized ledger that nobody can control because as 0:21:15.840 --> 0:21:18.080 long as somebody controls the ledger, and that's really what 0:21:18.119 --> 0:21:19.879 it comes down to. Back to the gold example that 0:21:19.920 --> 0:21:22.040 we had. UM, when I put my gold in the bank, 0:21:22.040 --> 0:21:24.120 and the bank gave me a paper clertificate they had 0:21:24.160 --> 0:21:26.520