Video Of The Week: The New York Public Library Bitcoin Discussion

Last week we had a discussion at the New York Public Library about Bitcoin. Andrew Ross Sorkin moderated a discussion between Nathaniel Popper, author of Digital Gold, Bitcoin Chief Scientist Gavin Andresen, and me. Here it is:

#hacking finance

Comments (Archived):

  1. JimHirshfield

    I watched this earlier in the week. Great conversation.

    1. Twain Twain

      Ditto and “Euphoria of ignorance” is one of the phrases I’m going to borrow liberally.

      1. JimHirshfield


  2. William Mougayar

    The world can definitely use more Bitcoin/Blockchain education. I watched it live while driving back home, and while replaying it in mind, it struck me that the majority of this talk was focused on “what it is” vs. “what it does”.Not faulting the participants, but it is what it is. We’re still at the stage of describing the beast by speeds and feeds, and when we attempt to describe what it does, we’re stuck with generalities, like “it can do this or that”.I’m sure (and I know for a fact) that this will be different a year from now, and we’ll be in the “show me”, not “tell me” stages.

    1. Twain Twain

      Even in the “Explain it to a 3 year-old” the panel assumed a level of knowledge that is that of an 11 year-old.How many 3 year olds know words like these:* protocol to send money, big spreadsheet (Popper)* digital wallet, currency, blockchain (Andresen)* peer-to-peer database (Fred)Explaining to a 3 year old what bitcoin is: “When we buy a toy in the real world we have to pay for it with cash. Cash is notes and coins. Now, you see when you play with your ABC app on iPad? We pay for that with digital cash. Digital means there’s no physical note or coins. We can’t touch it or hold it in our hands. But it exists in code inside your iPad. And that code is smart and it can move the digital cash from Mummy’s bank to pay for your ABC app. The code is a series of 0’s and 1’s that are little bits of information that Mummy’s bank computer and your ABC app can read.”Child: “So where does the digital cash come from? Who makes it? Is there someone inside the iPad making it?”Adult: “In regular cash, there’s a printing press to make the notes and coins. In digital cash, they mine it. They dig it out with computer code made from 0’s and 1’s.”Child: “Whoa…! Wait, there’s computer code of 0’s and 1’s inside my iPad?!”Adult: “Yep. And your iPad can talk to another iPad because the computer code connects them. That’s called a network. And iPad talking to iPad is a peer network.Child: “WOW.”

      1. William Mougayar

        Pretty Good! They should have had a 3-year old moderate the panel !!!

        1. Twain Twain

          Haha and I totally agree with you.Waiting for Bitcoin-Blockchain to(1.) Rebrand itself.(2.) SHOW so the tell is simpler.The diagrams I’ve seen on it are ridiculously convoluted and I have the technical background to get Bitcoin-Blockchain so am not surprised the lay person’s eyes gloss over.And how many 3 year-olds have read Satoshi’s paper that keeps being referenced?Einstein distilled his super-complex work to E=mC2 which can be easily explained to a 5 year old.

      2. Richard

        Mommy, Bitcoin seems more like a prototype and not a protocol? Also, it seems like Bitcoin will attract people want to get Rich from playing with money? Mommy, how will Bitcoin make it easier to take me to Disneyland?

        1. Twain Twain

          Haha, right, 3 year olds have self-interests and haven’t been socialized into ideas of distributed considerations, protocols and diversifying currency risks per the Bitcoin-Blockchain.They just want things they can see and experience that are “real” like Disneyland.

        2. JLM

          .One might be tempted to suggest that bitcoin and Disneyland are built on the same premise — fantasy.If the Mouse goes long bitcoin, can the rest of the world be far behind?Always be on the same side of the trough as Mickey.JLMwww.themusingsofthebigredca…

          1. Richard

            Yep, before tech was cool, Disneyworld had tomorrowland.

      3. JLM

        .Isn’t your example above the exact same whether it is dollars or bitcoin? Or a credit card?JLMwww.themusingsofthebigredca…

        1. Twain Twain

          A typical 3 year old has seen a dollar note and a credit card but never seen a bitcoin.Part of me wonders why those involved in Bitcoin-Blockchain haven’t made a game teaching kids to put Bitcoins into their virtual piggy banks.Our notions of money are seeded when we’re toddlers.If Bitcoin means to change the idea of what money is for consumers…they need to make 3 year olds adopt it.

          1. LE

            Our notions of money are seeded when we’re toddlers.Sure as with almost everything. See all of those kids that hang out with their parents at Starbucks? See all the parents who take their kids to McDonalds? All that love of Nascar and the NFL? [1]they need to make 3 year olds adopt it.The problem is that there is no “they” in something that isn’t under central control. No Debeers cartel.[1] Why it’s probably impossible to start a new major sports league I would imagine. No pre-imprinted status, love and/or appreciation in the brain. Almost certainly one reason why I don’t care about sports is that my father never cared about sports. I know that there are many people whose parents didn’t care about sports as well that do care now but they most certainly were given exposure by friends or others that they admired or trusted at an early age and adopted from there.

          2. JLM

            .Uhh, I have never actually “seen” a bit coin myself, TT.What do they look like?There are some incredible apps out there which deal with arithmetic and money. I worked with some guys who made an app that could literally stand in for arithmetic. I will have to check on them.Why does bitcoin require us to change our ideas about money if it is intended to be used just like money?JLMwww.themusingsofthebigredca…

          3. Girish Mehta

            There is No Ithaka. Only the Journey to Ithaka.There are no bitcoins. Only records of bitcoin transactions. ๐Ÿ™‚ :-).

          4. JLM

            .Girish, I sort of understand what you mean. It made me chuckle. Not laugh but chuckle.In fact, I understand what you mean and I applaud it. It is actually the story of life.The end is known from the beginning. It is only the journey between the beginning and the end that is unwritten.Something that deep can never work because we are all really incredibly shallow.Head fake. Stutter step. Deep mojo. The plot thickens.JLMwww.themusingsofthebigredca…

          5. Girish Mehta

            One of my favourite poems….by CP Cafavy.”….Keep Ithaka always in your mind.Arriving there is what you are destined for.But do not hurry the journey at all.Better if it lasts for years,so you are old by the time you reach the island,wealthy with all you have gained on the way,not expecting Ithaka to make you rich.Ithaka gave you the marvelous journey.Without her you would not have set out.She has nothing left to give you now.And if you find her poor, Ithaka wonโ€™t have fooled you.Wise as you will have become, so full of experience,you will have understood by then what these Ithakas mean”.

          6. JLM

            .I may have to branch out beyond Kipling. Thanks.JLMwww.themusingsofthebigredca…

          7. Twain Twain

            “What do they look like?”This goes back to my comment on other post about the branding problem for Bitcoin. People instinctively think, “What do you mean a bit of a coin? It’s chipped off from somewhere? I haven’t got a whole coin but just a bit of it? I’ve lost value somewhere?!!!”Bitcoin has a knowledge representation problem that requires visual and text communication which the people currently actively involved in Bitcoin-Blockchain have no idea of how to do.Maybe that’s why Fred is tapping into AVC’s collective brainpower to solve this.

      4. ZekeV

        I think I was 5 before I realized that the $20 bill I deposited at the bank wasn’t the same one I could withdraw later. I was very upset by that revelation!

        1. Twain Twain

          You have great parents. Most kids aren’t taken to the bank until much later.

          1. ZekeV

            Seems like an oversight, for sure.

          2. LE

            The important connection to make with kids I feel is associating money with things that they want that money can buy. That way they are motivated and driven by the entire concept of money being important and having value.

      5. Dave Pinsen

        But that still doesn’t explain Bitcoin, because it doesn’t differentiate it from digital cash.

        1. Twain Twain

          Bitcoin, in the way the moderator and panelists set it up, is digital cash/gold/currency.The problem with Bitcoin is that it is a hybrid (aka a Chimera) of different properties and functions.On the economics side, it’s a form of money, a currency.On the tech side, it’s a protocol that enables a packet of information to be transmitted and shared over a distributed network.On the maths side, it’s a set of complex probabilities that unlock a Bitcoin.On the financial accounting side, it’s a transparent ledger.The average person on the street is unlikely to have studied economics, tech, maths AND accounting to have frames of reference to understand Bitcoin.A 3 year-old, though, has enough knowledge to understand the difference between real-world cash and digital cash.

      6. Erin

        Awesome! Thanks… feeling less like an idiot. ๐Ÿ™‚

        1. Twain Twain

          :*). Often, it’s good to feel like an idiot even when we’re not idiots.It usually means the people explaining whatever the thing is are making it harder than it should be.

  3. Twain Twain

    Proprietary trading accounts for $700+ TRILLION of value. Wrt it replacing it as proprietary transaction process system, there are three issues to consider:(1.) Transparency on the blockchain => reduce ability to hedge & arbitrage based on dark knowledge.That’s a substantial chunk of the banks’ revenue models affected so it’s no wonder they’ll create their own blockchains and versions of Bitcoin on an interbank basis.They’re hardly going to join the mining alongside the Chinese miners!(2.) Dodd-Frank act restrictions on prop trading.(3.) Potential EU legislation to ban prop trading by 2017 => so Blockchain’s potential as a replacement for prop transaction processing system would become null and invalid.So Bitcoin-Blockchain’s prospects are contingent upon government legislation to mandate it — unlike the Internet.The other aspect of it is this notion of democracy and who carries the weight of decisions and is considered more valuable.As Andresen shares, miners need specialized hardware and cheap electricity and higher-end programming skills. A risk is that we’re replacing one form of elitism with another.Central bankers, bankers & politicians = highly educated elite, cliquey.Bitcoin miners, tech geeks = highly educated elite, cliquey.I’m somewhere between Andresen and Fred’s position on Bitcoin-Blockchain, and learnt a lot more from this video so THANKS!

  4. JLM

    .You may want to clip this video a bit. The lions don’t begin to roar for quite a few minutes — for about seven minutes.JLMwww.themusingsofthebigredca…

    1. William Mougayar

      you’re in your video producer mode ๐Ÿ™‚

  5. Tom Labus

    The author struggled mightly to provide a simple exxplanation. I almost left at that point.They should have had this guy there:

    1. William Mougayar

      well, that article raised more questions than answers, especially about the Nasdaq implementation. I like that the Nasdaq is embarking on this project, but its communication seems to be carefully orchestrated, either to keep expectations low or because it might be a real competitive advantage.that’s one to follow for sure.

  6. JLM

    .If this moderator had been running a funeral, the dead guy would have come back to life and killed him. There was a lot of info that was like crawling through broken glass to get to.The info was quite good.JLMwww.themusingsofthebigredca…

    1. William Mougayar

      Good thing you’re only bashing the video producer and the moderator, and not Bitcoin proper! Love it ๐Ÿ™‚ #progress

    2. LE

      Wow you are totally sounding like me there. Is it that bad? Now I have to watch it….

      1. JLM

        .In the end, we all regress to a mean. Unfortunately, it sometimes is in a cemetery.JLMwww.themusingsofthebigredca…

    3. Girish Mehta

      I wasn’t that bothered by the moderator actually..But sometimes its interesting to not have any moderator and to let people who know what they know talk to each other – see where the conversation goes.Reminds me of this other event also at the NYPL from a couple of years back. One of the more engaging conversations, regardless of which portions you agree with. Kahneman and Taleb – no moderator…at the NYPL.p.s. The very end is a example where a conversation goes between two people who understand what the other person knows. At 1:17:00Kahneman: If I was you….I was expecting you to give a different answer.Taleb: Oh…what…Kahneman: …(Speaks)…Taleb: Uh…he’s right…he gave a better answer…

    4. Otis Funkmeyer

      i actually think the moral of the story is that panels are inherently bad. in fact, i seem to remember fred saying several years ago that he would never do another panel… maybe that was mark suster tho, hrm…

      1. fredwilson

        that was me. i make exceptions to every rule at times. i should not. panels suck.

  7. JLM

    .One of the things that bitcoin has to eventually confront is “parity pricing” — the notion that exchange rates can be measured by the cost to buy the exact same basket of goods in different currencies.This is a way to test whether the exchange rates between two currencies are under-, over- or fairly priced. It is not a new concept but it often overlooked.To get into the bitcoin game, one has to exchange (disregarding miners here as most folks will never be miners) a currency for bitcoin.If bitcoin is going to be used (accepted) by retailers — a use case that was bandied about quite a bit — then it will have to stand some test of parity pricing unless retailers approach it the same way that AmEx approaches foreign purchases (settling your account on a day of their choosing at the then current exchange rates and thereby not taking any currency risk).I was, frankly, surprised how little new information there was in regard to uses other than as a currency. Fred, clearly, was the most insightful member of the panel. Well played.I have not yet read the book, Digital Gold, but I will.I used to think bitcoin was a simple head fake. Now, I am inclined to see it as a head fake coupled with a stutter step or two. [One has to expect basketball analogies during the NBA playoffs, no?]Great Memorial Day weekend to all. Remember why we have Memorial Day and celebrate it in the right spirit. A lot of men died to make it possible for us to type stuff in our underwear. Thanks.JLMwww.themusingsofthebigredca…

    1. William Mougayar

      “surprised how little new information there was in regard to uses other than as a currency.”- agreed & despite Fred’s trying to pull in that other direction, the moderator and author were stuck in the money paradigm, and Gavin is so much into the Core of Bitcoin (and thankfully for that) he couldn’t articulate well what people were doing 2 or 3 layers above his stack.—typed in my pajamas, Go Cavs

      1. ZekeV

        The moderation was annoying. I wanted to hear more from the panelists, and less of what the moderator thought he should talk about. Sure, a lot of people don’t bother to understand technical topics. Still, all this “explain it to me like I’m an idiot” stuff is insulting to our intelligence. Maybe the moderator is an idiot, but I’d like him to pretend that I am a reasonably intelligent and curious person. Also I am pretty sure he’s not an idiot — someone should tell him he won’t lose his audience by engaging on a technical level.

        1. LE

          “Maybe the moderator is an idiot”Actually he no doubt fancies himself (Sorkin) as a typical NY intelligentsia (read his wikipedia page) and as a result has a high opinion of his far reaching intellectual capabilities and breadth of knowledge. Interesting that I am reading on wikipedia that he was the NY Times mergers and acquisition reporter when he was 22 years old. So much for depth of experience and long term perspective.I haven’t watched the video (so far) but now you have me curious.

          1. ZekeV

            If someone could edit it so we only hear the panelists speaking, it would be better.

          2. LE

            With all of the videos that Fred posts, in a ideal world, it would be nice to have an intern whose job it is to curate and downsize clips like that as well as other less than digestible information. [1] I am sure there are a boatload of NYU film school types that would jump at the chance to do that. I would imagine that by fair use and with the proper editing it could be done w/o legal problems.[1] But not going to happen because to many things on the plate as it is.

          3. ZekeV

            yeah, I agree. It’s just a general gripe I have about celebrity journalists in general, that they think we want to hear them talk. the ideal interview for my money is one where the focus is on the subject. Often times the interviewee has a better sense of what the right question is, and with some minimal prompting will rephrase the journalist’s question into an intelligent one, then answer it for us.

          4. Erin

            I thought the moderator did a wonderful job. the conversation could have stayed the entire time in the left side of the brain, but he kept it going back and forth between the right and left. That was what people like me need. I don’t understand left-brained things like numbers, but when I see emotion or hear stories about money, let’s say, I get it. That’s why I read this blog. He kept bringing the conversation back to the practical. Well done Sorkin.

          5. ZekeV

            ARS is an accomplished journalist and certainly doesn’t need *my* advice about how to do his job. I’m a terrible story-teller, long-winded, and often start out before I know what my point is going to be.But in my view ARS (and Popper for that matter) misses some important aspects of the bitcoin story by trying to make it more interesting or accessible. And with bitcoin, the way he presents the technology as something potentially accessible to people who don’t understand math or computing is potentially hazardous to your financial health.Bitcoin is a very powerful innovation, and I am happy we have it. But I have mixed feelings about efforts to popularize it, because inevitably those who are not properly prepared (and some who are) will part with more money than they can afford to lose.

          6. Erin

            Except the way Fred evangelizes about it, you would never know it’s not for the masses. He makes it seem like something that’s going to bowl us all over if we’re not prepared. I hear you about jumping in before being properly prepared (ie. the Argentinian retirees who lost everything, etc.) but knowledge is power and if we don’t understand something, we’re not going to be empowered right?

          7. Erin

            And I’m really bad at self-selecting myself out of things that are too complicated to understand, so this interview was the perfect balance IMO.

          8. ZekeV

            Knowledge is good, and I think humans should study everything, even if we’re uneasy about certain knowledge — how to make a nuclear bomb, for example. Bitcoin is kind of like having the plans to make a financial nuclear bomb.

          9. Erin

            We agree. ๐Ÿ™‚

          10. Matt Kruza

            Agreed. Sorkin is a pretentious douche. really no two ways about it. Self-important people who don’t actually contribute much annoy me. Either be humble or be a bad ass. Being a braggart who is pretty much worthless / leeching off of those you interview is annoying. Haven’t seen him in a while but years back on CNBC he really annoyed me. (sounds almost like I went to high school and the guy pissed in my coffee.. but I promise I was just egged on by your astute analysis of him)

          11. William Mougayar

            “Either be humble or be a bad ass.” I like that statement.

        2. Erin

          Einstein said, “If you can’t explain it simply, you don’t understand it well enough”.

      2. Richard

        Fred’s poll questions would have summed up the current state of Bitcoin.

        1. William Mougayar

          haha…very smart and funny.

    2. ZekeV

      I think of bitcoin pricing differently. Bitcoin buys you a tx record on the blockchain, and potentially some processing time on a distributed network. If you compare the cost of storing information on the blockchain, it turns out that it’s some multiple of the cost of buying similar capacity from AWS. Can’t remember off-hand what that differential is, but let’s say for the sake of discussion it is 1mm X pricier to use the blockchain for storage or computing, compared with a centralized cloud service.That huge differential has to be justified in terms of the unique characteristics of having a “trustworthy” cloud computer.Of course the price of bitcoin, or of some small denomination of satoshis, will float in the market. And the movements of that float, if they are explained by anything, are likely to have more to do with development of new trustworthy computing applications, than they do with the commodities prices behind the Big Mac Index, for example.Though at the moment the prices of the various bitcoin-like digital assets are fluctuating mostly due to manipulation, as the strongest explanatory factor…

    3. LE

      Interesting, I had to just read a bit to find out what a stutter step was although I kind of figured it out from context:Quickly follow this hard step with two or three more hard stepsโ€”i.e. right, left, right, leftโ€”which will successfully give your defender the illusion that your next move could go either right or left.

      1. JLM

        .Remember to keep your pivot foot fixed to the court.Next, we will review the “triple threat position” the basic attack position for all of basketball.Head fake, stutter step, triple threat position movements — basketball as a science and an art.JLMwww.themusingsofthebigredca…

        1. LE

          I kind of get that that is what you guys like about the game. It is art to you on many levels. [1] And for those who don’t see the art there is always the gambling attraction.[1] And art is analog, not digital so there isn’t a clear right or wrong but just degrees. Everyone can be occasionally intermittently reinforced. Whether they are 6 or 60 years old.

          1. JLM

            .The NBA playoffs are when you get to see the best players who really know the fundamentals — guys like Steph Curry and Lebron James.They are both studies in sound fundamentals — one guy is smooth as silk with a perfect shot and the other guy is a physical beast able to take his game above the rim.But when they both get the ball, they go to the triple threat position — shoot, pass, dribble — and go to work on their opponent.If the opponent doesn’t close with them both of these guys let it fly.If he gets too close, they fake him and blow by him on the dribble.If too much attention is drawn to them, they stick the dagger in with a backdoor pass.Watch really good college teams and they are always fundamentally sound. And, even at that level, they’re still leaning the fundamentals.Coach Wooden won all those championships teaching players how to put their shoes and socks on the first day of practice.Of course, he had some talent to work with.I think this approach to business — Vision, Mission, Strategy, Tactics, Objectives, Values, Culture — is also the driver of fundamentally sound businesses.JLMwww.themusingsofthebigredca…

          2. LE

            Fwiw a guy that I know locally pretty well and deal with, his brother is a well know sports agent. When I was in his office he had all of these pictures with sports stars that I guess his brother hooks him up with. Meant nothing to me I just thought he got them when he went to the game.This guy:…Actually I am now seeing that he used to rep Lebron James.

          3. JLM

            .He is a very well known guy. His stable of clients speaks for his rep.All those guys end up gravitating to the big firms who have the deals with the big endorsement engines like Nike.JLMwww.themusingsofthebigredca…

        2. Twain Twain

          Lol and can you cover the lay-up too?

    4. JamesHRH

      I have never thought of tech ideas as giving us the Ol’ Isiah Thomas Shake & Bake.Too funny.

    5. Matt A. Myers

      Bitcoin is becoming more “accepted” by retailers because they can have it immediately converted to an actual currency – that’s one good stutter step there.

      1. JLM

        .Sort of my point exactly–it is doing the same thing as regular money and neither better and, maybe, not worse. It is just a coat of paint with a currency underneath that is just like using dollars or Euros, no?It is not providing any real bargain.Can it be used to effect credit card transactions?Much of retail success is based on the extension of credit–the ability for a consumer to make an impulse buy without checking to see if there is any money in their account?This is not a killer app. It is very pedestrian at best.JLMwww.themusingsofthebigredca…

      2. cemilturun

        To have what you have just earned immediately converted to another one does not support the validity of the value of that currency. You don’t escape from one currency to another if you are convinced that the first one is good and stable.

        1. Matt A. Myers

          In people’s minds it does, because they don’t know it’s being converted, so they think it’s being more widely adopted and therefore feel more comfortable about it – trust it more.

    6. Otis Funkmeyer

      hey JLM, i wonder if you’re familiar with marc andreessen’s concept of the floor of the price of BTC: the total value of transactions that want to go through the system at any given moment divided by the number of bitcoins.The analogy is akin to a pipe. If a certain volume of water wants to go through the system, the pipe needs to be large enough for it to do so.So regardless of how it’s used, that would be the floor. It makes a tremendous amount of sense to me!Have a great weekend in the ATX! Life is beautiful, as always, here in the LAX ๐Ÿ™‚

      1. JLM

        .Where you been?JLMwww.themusingsofthebigredca…

        1. Otis Funkmeyer

          where haven’t i been? ๐Ÿ˜‰

  8. LE

    In the print edition of the WSJ yesterday (picture attached) you were mentioned as “a partner at New York based Union Partners”. If you write to them they will highlight a correction on page two which is free publicity.Same error also appears in the online article as well:

    1. fredwilson

      I would prefer the WSJ not talk about me at all. I despise that publication

      1. JLM

        .I have no idea why but I love–love–the idea of your despising the WSJ.That’s the kind of shit I say all the time.Well played!JLMwww.themusingsofthebigredca…

        1. LE

          Would like either of you to explain exactly the reason for the “despise” particularly the emphasis.

        2. Otis Funkmeyer


      2. LE

        Probably explains why I am not a social person. To many inside baseball things to keep track of, who would have expected that as a response.

      3. LE

        I get ideas from reading the WSJ constantly and I can actually directly connect money that I have made to things that I’ve read there (of a non finance nature). The only thing that prevents me from spending more time reading the WSJ at night is that my wife is waiting for me to spend some time with her.

        1. Richard

          Yep for most of the Americas great run, it was the wsj that kept a informational level playing field for the little guy

          1. LE

            No to be clear I am not talking about any financial information in the journal but more of the soft topics.

          2. Richard

            Me too

      4. Twain Twain

        Tell us how you really feel, Fred, haha.It’s the paywall thing, isn’t it?

        1. LE

          Getting beyond the paywall is just a matter of googling the subject line and viola “wahla” you can read anything you want. However note that I subscribe to the print edition. I like having a physical newspaper to read typically while eating at night. Plus I get to see what stories (and this is important) are curated as worthy in one way or another of being in the print edition.

          1. Twain Twain

            You mean “Voilร !” but a viola’s so much more fun, haha, :*)

        2. fredwilson

          that and a bunch of other things. they stand for everything i hate

      5. Erin


  9. Peter Waterland

    The most interesting commentary came from Fred Wilson suggesting that the big banks should set up mining operations in the US.

    1. Charlie Chung

      I don’t think he said where the operations should be…needs to be in a price of power-competitive place. Also, if the point was that banks would be nervous about a volatile currency with a short track-record, they wouldn’t be able to mine enough to allay that concern…

  10. Richard

    still waiting for a explanation as to why the following is needed? “As a side-effect, mining adds new bitcoins to the system. For each block mined, miners currently get 25 new bitcoins (currently worth about $6,000), which encourages miners to do the hard work of mining blocks. With the possibility of receiving $6,000 every 10 minutes, there is a lot of money in mining and people invest huge sums in mining hardware.”

  11. abolish

    So Fred, I take it from your answer at 37:55 (to the question “will i not use my amex when i go to amazon?”) that you’re not bullish on bitcoin as something consumers use directly, but rather a way for banks to do transaction processing and clearing behind the scenes. A “B2B” more than “B2C” technology. You later state that merchants will work with fiat currencies and just convert to/from bitcoin on the fly for transaction processing.I don’t get how that’s so disruptive or valuable unless that stuff is really inefficient today. How inefficient is transaction processing & clearing?

    1. fredwilson

      that’s not right. i am bullish on both.

  12. Jaco Pretorius

    One question that was not answered (and which I was really hoping the moderator or an audience member might ask) is: why should average Joe start using bitcoin? I just can’t come up with a good answer – I can see why it makes for retailers to start using it (lower fees) but apart from political motivation or potentially privacy concerns, I can’t think of a good reason.

  13. cemilturun

    After watching this good discussion, one realizes that the Central Puzzle of the Web today is: How do we redefine and redistribute value in a non-central fashion, using web based tools, while Kapitalizm and its central wealth distribution structure implodes.

  14. cemilturun

    My question to Fred after his answer to an audience (1:08:00) Fred, how come you expect returns of hundreds of millions of dollars from your investments on bitcoin related businesses? Isn’t this an illogical expectation? If a bitcoin related company (or a blockchain company) succeeds, then how will they (and your company) exit in US dollars and not BTCs or other alt-currencies. Do you see the fallacy here?

  15. Travis Henry

    I really like the explanation of the blockchain as a “peer to peer database.” As someone who follows bitcoin and attempts simplified explanations, I found this approach useful for conveying the potential value of the blockchain. Also smart comparing its decentralized yet reliable/redundant nature to the internet (which we all know and love).