Hello, and welcome to another episode of The Odd Lots Podcast. I'm Joe Wisenthal and I'm Tracy Hallway. Tracy, I don't want you to take this the wrong way, but you know, no, I know, but I kind of feel like of the two of us, you kind of are a little have try to think how to phrase this in a polite way. You have like a little bit more like no, no, it's not that bad, but you have like a little bit more like sort of crankish conspiracy theory minded sympathies
a little bit conspiracy. No, no, a little bit. But I am don't even know the problem is, I'm surrounded by conspiracy theorists and I like to be fully informed, so I listened to what they have to say. That's that's it. I'm I'm a depository for conspiracy theory. But like you kind of like are into gold and silver and you kind of hate the Fed a little bit, and you kind of believe that there's bubbles everywhere, just
a little bit. I'm not saying like full on, but you're like sort of like you're like kind of curious, like you're you're open to it. Right, this is like scandalously libelous. I don't like gold or silver. I keep getting given it for my birthday and I end up with it. I think the FED has done a reasonably good job, although I certainly have some advice for them on how to proceed. I do think the corporate bond market is overvalued and there may be some trouble there
in the future. There those are my opinions. So the only reason I brought this up because even though I do feel like you're a little more like crank curious than I am, I actually think that on one topic you're a little like more skeptic goal than I am within this whole like the crank role. What's that? Digital currencies? Yes,
I would agree with that. Yeah, Like I feel like you're pretty like deeply skeptical of them, and you're like kind of the view that they're all scams, and I'm like pretty skeptical of them and think they're mostly scams. But I'm not like as entirely negative on them as
a conceptually as you are. Wouldn't you say that's fair? Well, so, I have some problems with digital currencies, but as a concept, I think they're really really intriguing and what I like is when people basically get up and say the only reason for digital currencies to exist is because of regulatory arbitrage purposes. Like, if we can start from that basis and just be honest with ourselves, then I don't necessarily have a problem with them, but I still think they
are going to face some massive, massive challenges. Okay, that's fair enough. Well, today, I'm actually kind of hopeful that in our converse station today, which obviously at this point everyone's figured out, is going to be about Bitcoin and perhaps other cryptocurrencies, that actually we might be able to arrive at a place where we uh see see things from a similar perspective. Okay, Um, I'm willing to have my mind changed, so I'll be interested in this one.
I think that's optimistic. So you mentioned that you're kind of believe that maybe there's a niche for cryptocurrencies and some sort of regulatory arbitrage, and I would argue that you could slightly accept that and broaden it a bit if you sort of think of cryptocurrencies as not just regulatory arbitrage per se, but in allowing people to engage in transactions that maybe big governments or big corporations you wouldn't want them knowing about, or maybe they wouldn't allow
you to do. It's kind of of the same category such as illegal transactions, well some of them, but even you know, illegality can be either moral or immoral, depending on the country, in the law and context. True, and this is something we did touch on with Joe Carlson a while back, like the idea that what's deemed illegal in Venezuela might actually, you know, in other countries, be deemed necessary for survival, and people are using bitcoin in
order to survive. Yes, right, So today I'm very excited because we're gonna be talking to a guest that really ties these concepts together. His background, or at least's current position, is not what you would expect from a sort of typical crypto guest or sort of bitcoin believer. Our guest today is Alex Gladstein. He's the chief strategy officer at the Human Rights Foundation, and he talks a lot about the sort of intrinsic connection he sees between bitcoin and
human rights. Al Right, well, let's bring Alex and Alex thank you very much for joining us. It's a pleasure to beyond thanks for having me so like I said, you know, we we talked to a fair number of people in the crypto world from time to time. Most of them are in roles that are sort of crypto specific. Maybe they work for a VC fund, or maybe they're
just an investor, they're a software developer. You have something that's sort of a distinctly different perch, I would say than many of the people who are interested in this space talk to us. Just first of all, what do you do? What's the Human Rights Foundation? And when did
your interest in uh digital currencies arise? So? The Human Rights Foundation is a nonprofit charity based here in New York City that I started working for in two thousand seven, and the mission of the Human Rights Foundation is to help promote freedom and human rights and closed societies. So we work with people who live under authoritarianism around the world, and by our internal metrics, about of people live under either a partially or fully authoritarian regime. It's about four
billion people. So the kind of people that I'm talking to all the time are struggling against various injustices in places ranging from North Korea to China to Saudi Arabia to Burma to Russia to Venezuela. To Cuba, to Zimbabwe, etcetera. And it's kind of from their perspective that I learned about why money not controlled by the government would be
really useful. Um. So my perspective is just very different from most people, I would say, even from the general human rights community, because I have this particular focus on trying to help people who live under authoritarian societies where you know, they don't have independent media, independent courts, They can't sue their government, they don't have an e f F or an a c LU to donate to, they
can't write not bet in the newspaper. Um. You know, their ability to hold their government accountable is like almost non existent. So what these governments tend to do is closed down the bank accounts of people they don't like, or um hyper inflate the economy, or you know, just basically steal or sees or confiscate funds from organizations that are critical of them. So in this context, bitcoin is
very interesting. So walk us through the exact use case then, because you're talking about very authoritarian regimes that have almost complete power over their domestic population. So I'm curious to what extent does bitcoin actually help those people offset the power of the state. Sure, and I'll get into a couple of examples, but I do want to make a plea to to the listeners that this matters for everybody generally speaking. This is what I'm about to say, is
not a conspiracy theory. Money, the kind of money that you use every day, is transforming from a bearer asset into a surveillance and control mechanism. That's not a conspiracy theory.
Meaning the money that I use when I use, whether it's we chat, if I live in China, perhaps visa here, etcetera, etcetera, like the the way that I do transactions is becoming increasingly controlled, surveilled, etcetera, moving away from a society where it was okay um and widely accepted to use basically anonymous money in the form of cash, like in fifteen twenty years, no one will use paper or metal money.
So I think that this transition is the core of the matter and is why having bitcoin uh and what will be built on top of bitcoin in the future, which will be like basically hopefully private payments will be something that can save us from essentially either like Big Brother or surveillance capitalism. Now that need is much more cute obviously in a place like Iran, or China or Venezuela.
So I'll just give you a couple examples. So, in Iran today, due to both American sanctions and financial controls from the Mala's, it's impossible really to send money from the West into Iran if you have family there to help them. Right. So I know someone who's um living in London. She's Iranian and her partner's father is very sick in Tehran, right, so there's no way for them
to send money, uh to help this person's father. However, they can use bitcoin, So within twenty thirty minutes, uh, they have a non k y C Bitcoin account, meaning it's not connected in any meaningful way to their identity. The bitcoin appears on his father's phone in Tehran, and then he uses like local exchanges to turn it into real and get medical assistance. So this is like a really interesting and I think important way to show that
like this can be a lifeline. Obviously you heard from Jill on a previous episode about how some Venezuelans are taking advantage of this as well. Some people are earning money in bitcoin and circumstances where they couldn't earn money like if they live in Iran or Venezuela, for example. I've seen some uptick in Palestinians using bitcoin, both in Gaza and the West Bank. Obviously there's quite a bit of uptick in places where the economy is creating, like Lebanon, Argentina.
There are organizations in Hong Kong which are starting to get their bank accounts shut down, right So, for example, there was an activist organization recently that that got its HSBC account closed for political activities. Well, they can't stop them me from donating bitcoin to them. And probably the most important civil society organization in Hong Kong, or one of them, is the Hong Kong Free Press, right, So the Hong Kong Free Press has been accepting bitcoin donations
for a while now. It's been very very helpful to them. So when you're on the front lines of freedom, I believe that even today, like it's sort of infant state, as a technology, bitcoin can be extremely helpful. So obviously there's a lot to explore there. I just want to talk a little bit more about, as you say, you're seeing it happen on the ground, because there's a lot of people and this is kind of something that we
talked to with Jill Is. There's certainly a lot of people, and I'm sure you come across them who like to pontificate about how bitcoin can help people in emerging markets or whatever, all while sort of you know, sitting in there we work space in San Francisco or whatever, without actually having interactive They usually talk about why some other cryptocurrency can but sure, right right exactly, or the one that they're working on, the one that they're working on
is going to be great for right payment, cross border payment. To be honest, there's a lot of whitewashing space. Somebody's working on some new token project and they're like, oh, they come to me and they're like, this has happened numerous times. Uh, you know, we're working on this new token. Do you think you can help us, like find a
use case somewhere? And I'm like, no, this, this, this is not what you know, that's not what in terms of like you're really seeing it, you know, it's is it more than just a sort of isolated case here and there, Like what are you actually seeing on the ground in terms of how so example, for example, I know a guy his name is Mo he's an entrepreneur. He was born in Aleppo, Syria. Now, of course he lives in London, but he does some like translation and
creative work. His company does this stuff, and there are people inside Syria who still work for him. So he pays them in bitcoin and they use Facebook groups to turn the bitcoin into Syrian money when they need to. So in that case, the Syrian money is like a disaster from like its perspective against the dollar, for example,
so they keep it. Actually they actually use the bitcoin is like their checking their savings account, and then they withdraw it essentially via these like peer to peer groups into the local currency when they need to spend it. Now, of course that's a fringe example. There are not that many countries in the world that have uh, you know, inflation that high. But it's we're talking tens of millions of people across different hemispheres, right from Venezuela to South
Southern Africa to the Middle East. So it is something that is making a big difference I think for many, many people, and it won't matter as much to people who live in New York or London or Tokyo in the near future because we have stable economies it's easy for us to get credit, we can get loans, are you know, financial system works pretty well. So people kind of,
I think, gloss over the real value in bitcoin. So when I talk to human rights activists about this, I think it's very similar to encrypted messaging in many ways. Like the average person in New York City probably doesn't need encrypted messaging, or maybe they do, but but generally speaking, they probably don't think they do same thing with bitcoin,
and they probably don't. But the average person and maybe Zimbabwe or in Iran may really need encrypted messaging because they're trying to talk to their family or a loved one who is, you know, in an opposition political party or whatever. So I think both encrypted messaging and bitcoin are our tools that are vital for people who live under very difficult political environments, but whose value may not
be so easily understood by people who live under open societies. Okay, well let me pick up that thread just on the point of the value. Is the value more that you have payment processing that's basically done by a decentralized entity and allows you to get money into and out of a country, or is the value that bitcoin is supposed to be anonymous and therefore untraceable. Like which one of
those things is more important from your perspective? Right, Well, bitcoin is pseudonymous, um, but it is much better than and as a payment. For example, if you're trying to of aida uh someone looking at you that then using something that's linked directly to your identity. It's not ideal, and there's a lot of work that needs to be done in bitcoin to make it more private. Um. But that works being done, and it's very interesting. But what I would say are the couple of main use cases.
Number one is like sanctions breaker, I guess we could call it. So you're being prevented from accessing the international financial markets for some reason, probably not your fault, Like the average twenty three year old Iranian entrepreneur. She didn't do anything to not be able to buy an iPhone. She didn't even vote for her leaders. It's a dictatorship, so why should she be punished? Right, So, these people get to access goods and services from the outside world
because of bitcoin, because it breaks sanctions. The second one is more like the example I gave with Syria, is as like a sort of confiscation resistant parallel savings account like the Syrian government just has no clue that these people have this bitcoin. They have no reasonable technical way of figuring that out, and they can't confiscate it. So for the longest time, you know, the human with more violence have been has been able to just like take
the money from someone else. Now that you can be like clever about it and hide your private key, either you know, somewhere on your phone or written down somewhere, or even memorize it, we have now an asset that is like much much more confiscation resistant. So there's censorship
resistance is important. The confiscation resistance is really important, and over time, the privacy aspect of it, as it becomes more mature, will be very important, especially for people, you know, in kind of advanced economies that don't want all their data being like sold to the data markets. So that's that's perfect because that's where I was going to go next.
You said at the beginning, and I agree with you that it's not a conspiracy theory to say that money is transforming from a a bearer assets something that I can just hand to you and nobody knows about it, to a sort of tool of you know, one might put its surveillance capitalism, or at a minimum, just sort of this series of credits that are being easily viewable
by corporations and government. And when I talked to or hear from people in the West who are like extremely negative on bitcoin, and there are a lot of people who are and think it's just a Ponzi scheme. I do think this is one area where people haven't fully thought through the implications of well, what happens when literally
every payment they've done. And I watched the debate this summer between the head of bit Max, Arthur Hayes and Noril Rubini and no Rubini he just at one point got up and he was yelling and he was like, well, you know, if these people can use we Chat and Apple pay, why do they need bitcoind And we're just all laughing, because because that's that's why you don't want all of your payments to be controlled by a single entity. You know, it's just a matter of financial freedom and
sovereignty and privacy. And I say that as a person who's pretty progressive politically speaking, I don't think this is some radical line rand thing, like, I think that this is something that can actually be a great equalizer and can allow hundreds of millions of people excess in a permissionless way to a savings vehicle that they currently don't
have access to currently. If you're, let's say, in a lot of the situations I'm looking at, how do you save money you buy sheet metal or cows or something like that, this gives them an electronic way to have something that's that's confiscation resistant and and parallel, and is much more liquid in some cases. I mean, the only reason I'm more excited about bitcoin now than I was a few years ago is because the ability for you to exchange it into fiat is on the rise. In
almost every major urban city in the planet. Even in cartoon you can you can sell your bitcoin for Fiat. Today, Bitcoin on its own is not very useful to people because they can't buy things with it, and I think we'd be naive to think that that's going to change anytime soon. But as a bridge between moneies and as a way to connect people, um in a very quick way, in a permissionless way, in a censorship resistant way. UM, It's it's really shining. I would say, So can I
pick up that threat? Because I I agree that the transition to digital pay months is going to cause all sorts of privacy issues and also potentially hardened financial inequality because people are only going to get you know, served up products and offerings based on their own transaction history or browsing history or whatever. But my question is, isn't the problem with the company or the platform that you're
actually transacting with. So for instance, if I go to Amazon and assume that Amazon could accept bitcoin, and I buy a book, a subversive book from Amazon, and I pay in bitcoin, isn't the problem still that I'm buying through Amazon versus you know that I'm using bitcoin? Correct? So right now, the way to get around that is to use the gift cards. Gift cards are very important part of the world economy. A lot of people, of
course in America something like Americans are underbanked essentially. Um, I was not eve enough for a lot of my life to not understand when I walked into a Walgreens or CVS that the gift cards weren't for Christmas gifts there for people who don't have bank accounts, how they
make electronic payments. So we have this kind of like a legal and moral um precedent right now that like using cash to buy gift cards and buy things on Amazon is totally fine, and we want to hold on too that We don't want to let that get taken from us. We need that. So I would argue that, like what I'm seeing is the birth of something that may work, which would be private payments on top of bitcoin. In the same way that like Visa is like a layer on top of the US dollar, it's like a
credit system on top of the dollar. You can think of Lightning as a credit system on top of bitcoin. So what I'm potentially seeing because Square is like heavily invested in this and has said that it's a matter of when not if that they will like release this
into their cash app. At least Jack Dorsey said that maybe six eight months ago that you'll be able to use what is basically an anonymous gift card to buy stuff at the Whole Foods and Starbucks and Amazon in the next year or two using this technology called Lightning. So it'll debit from your account, the merchant will see
the money. They won't know anything about you. They won't know your last transaction, your name, your address, and it's fine because they didn't need to know that stuff and that's not how it used to work, and you know that was the way things were. And I think it's like an aberration historically that when you pay for something today you reveal all this information about you. Do you think it's weird? How something that I think is weird anyway?
I don't want to put words in your mouth. Is there are a lot of people tech critics, many of whom are tech journalists, who really sounded the alarm these days. Is picked up over the last few years about the incredible power, influence and data that Facebook, Amazon, etcetera have of our lives. Like every day you pick up the New York Times and there's some article about how awful
these companies are. And yet I feel like the mainstream tech critics are still like pretty dismissive of bitcoin and still think it's like this like weird sort of on ran Silicon Valley project and not really putting two and
two together as you're putting it. I mean, look, if someone creates something better that does what I'm describing and gives us essentially digital cash that allows me to pay for things that I need to buy in my life without disclosing all this information about me, or like you know, slur rendering all my liberties. I'll be all about it, but you know what this is. It is what we have. This is the only way to make a digital payment
without a third party. This is why the coin is such a revolutionary financial technology is that it allows two entities you know, on the Internet to exchange value without a centralized payment processor. And and that was the big deal. And that's why, said Toshi nakamotos invention is so so revolutionary, and and that that is what I think allows us to start to think about a parallel way of doing things as opposed to relying on all these third parties
when we do digital transactions. Why people haven't figured this out yet, I'm not sure. I mean, it's quite um. It takes a lot of open mindedness, let's put it that way to like kind of look at this and be like, well, maybe bitcoins part of the answer. Well, by the same token, you know, you mentioned that your own views politically tend to be more on the progressive side. What is the reaction to it among fellow human rights activists in the West that you deal with at work
or other human rights organizations? Do they do? They typically of the same initial reaction, that's mostly like sort of like I rand, it's weird because for many years working in the human rights space, we didn't even think about money or currency at all as as relevant. And I remember this vividly. I invited a Zimbabwean opposition leader named Ivan Mauire to speaking an event a couple of years ago in San Francisco with Jill Carlson actually, and we said, hey,
do you want to come talk about hyper inflation? We just want to do an event on hyper inflation and kind of allow people to understand what it like. And he said sure, and he and I asked him to come and prepare some remarks on what he saw as a Zimbabwean happened in his lifetime economically, and he's like, no one's ever asked me to do this before. I
thought that was kind of strange. But when he got on stage and he started talking, he took out a necklace that he was wearing under his shirt and it was the nineteen eighties and Babwean dollar, and he was like, we all wear this, all the activists, and not all of them, but a lot of them as a symbol of what our economy used to be. Is fascinating, and I just think the money and currency we use is just, for whatever reason, in a different hemisphere or blocked off
from what we think of his human rights. So for many many years I didn't even think about it. Like I saw Mark Anderson's New York Times article about bitcoin, which I still think is one of the better explanations of what it is, and that kind of put it on my radar. But it was until a couple of years later that that someone I knew who worked at one of these UH mining companies bit Fury, was like, hey, we should like maybe get human rights activists to learn
about this. That I started to really dive in and then it it just sort of it went from there. But the human rights organizations today MSTY International, Human Rights Watch, if you just searched the word bitcoin, you won't find it. It hasn't gotten there yet, even even e f F and Wikipedia, which did receive bitcoin donations for a while and then like they you know, early on, and then they got rid of it, and now they're kind of
becoming more warmed to it. I would say even the digital civil liberties organizations are really like UM have position themselves to be very skeptical of it, which I think is uh is a mistake. I think they should be open minded to it. So we're not there yet with with human rights organizations. They just haven't. It's not that they're like really against it, they just haven't really realized that this is going to be really key. So money has always been entwined with with the notion of the
sovereign state in many ways. So do you worry that in arguing that bitcoin or some new digital money technology can successfully bypass the state and create a sort parallel um payment system. Do you worry that by arguing that, uh, you know, you'll make it sort of more likely or it will become inevitable that governments eventually cracked down on this. Of course there will. I mean we're seeing that now.
I mean, look, I think bitcoin, properly understood and manifested, uh will be a much greater threat to authoritarian governments than democracies. I think there's ways in democracies for citizens to have like back and forth and negotiations with their elected representatives, and we could come to agreements like, for example, hey, maybe it's cool that like unders dollars when you make
a payment digitally, it can be anonymous, that's fine. But you want to buy a house, you want to pay for tuition, you want to get a big loan by a weapon, whatever, maybe you need to provide I d But to me, this is like something that we could actually negotiate in a in a in a democracy, especially when like the United States, where we have a history
of like cash being like an important American value. In dictatorships, I think bitcoin is gonna be much more um of a problem because they won't want to give up their control over money. So I mean, obviously I think bitcoin separates money from state and I think that's going to be a really big problem for authoritarian systems because of the way that they kind of seize most of the money in the economy and and and then do things that the population probably wouldn't be so hot on. And
of course this happens in America. We just saw how much money did our government, or at least my government spend on wars in Afghanistan in interact something absurd. I mean, I didn't choose for them to do that. So, like super long term, if I'm thinking utopian, I suppose I would say that like an economy that's more based on this kind of asset would hopefully prevent that kind of um excessive spending that would lead to things like police
states and and unnecessary wars. But that's that's very far into the future. So within the US or within the Western developed context, one of the memes that you heard early on is that bitcoin is useless except for buying drugs online, and maybe that's it, And some bitcoin defenders
had like, Oh, that's really unfair. But I still kind of think it's fair in the sense that the properties of bitcoin that make it easy or possible for someone in Iran to send money to their a link relative to get health insurance or to get healthcare, the properties that enable that transaction, which most people think are good, are the same properties that allow people to engage in truly illicit things in the West, like buying drugs. There was also a big bust recently of a child pornography
ring and there were some bitcoin related payments. How do you sort of address the fact that there is a neutrality in some sense to the technology such that we could sit here and talk about all the great things that allows people to do for freedom, but also in theory it makes doing very bad things also possible. Yeah, I mean, I think it's really similar to the debate about encryption. UM law enforcement may say in Britain and Australia honestly, which you're turning into the biggest predators of
private information, which is bizarre given that their democracies. But they're basically trying to say, well, if you guys want to have like peer to peer messaging that's encrypted, we want to be and we want to be in the room, you know, we want to be like the third party, which is which is crazy. We need that ability to communicate privately and it doesn't mean we're doing bad things. There's some studies that have been done. So there was like an m I T based study that looked at
bitcoin activity. I think it was a study that was done last year and they looked at it about two percent of all the transactions they viewed as criminal pertable laws of the United States. Now that's very low. UM from what I've seen, about nine percent of the U. S economy is like quote unquote black market are illegal and the average O E C D countries like is what I've seen. So I think over time, the amount of bitcoin being used for illegal stuff will probably kind
of flow up and and even out around what. But I don't think the way. I don't think the medium um where the type of money we use will make people any less evil or good is my general gut feeling. And I think it's again it's like we need it. Like if we don't want to live in a society where all of our behaviors and movements and transactions are controlled and where we cannot criticize or descent or protest,
then we're gonna need the version of digital cash. The example that was so vivid I saw this summer was that Hong Kongers were starting to use cash to buy like metro cards so that they could go into the subway system and then exit without being spied on, because if they went and used their like I D Linked Octopus card to do so, their employers could figure that out and then fire them. And you need to be able to protest to hold your government accountable. This is
like something really important to democracy. So right now the Hong Kongers are able to do that because they have cash, But fifteen years they won't have cash, So how are they going to protest? Especially in an urban environments. This is another reason why I think digital cast is just so vital to democracy. I would just basically say that, you know, financial privacy is essential, essential to a healthy democracy.
I would ask people to show me other options. I'm certainly open to it, but like bitcoin plus second layer technology that makes a private seems like the best one right now. So the trope for technology is always that it starts off well intentioned and then at some point sort of becomes terrible. Why would bitcoin not be the same.
And the reason I bring that up is because, like, for instance, we saw China outlaw bitcoin very very early on, and now within the past few months, China's central Bank has come out and said they're exploring the idea of doing their own digital currency. So how would we ensure that bitcoin or other digital payment technology doesn't become opted by bad actors or used to bad ends. Yeah, that's a great question. Um, I think we need to separate
the technologies here. So I would compare what you just said, comparing like bitcoin, which is like open source, censorship resistant, decentralized money that nobody owns or no one has, you know, authority over comparing that with what the Chinese are going to build, which is going to be highly controlled, highly survailable. I mean, I think my personal view of what they're end goal is is to replace the M zero inside China with something that's trackable, get rid of paper metal
money entirely. I view these as like as different as um signal and UH and we chat Like. Yes, they're both digital currencies, but they're very very different kinds of digital currencies. So I think we just need to to bear that in mind. But it could go wrong. Yeah, Like my destopic view of bitcoin would be much like the original open Internet was perverted into like these like
kind of siloed data collection mechanism like Facebook and Google, etcetera. Uh, and that original promise of connecting us all privately was betrayed. I think what could happen with bitcoin. The what I think is most reasonable as a worst case scenario is that all of the exchanges and places and marketplaces that we go to exchange bitcoin and turn it back and forth into Fiat become surveillance points, and then it becomes not very useful. Well, I was I was going to
go exactly there. It seems like you could envision a scenario in which the government really does crack down on making sure that every entryway into bitcoin is very heavily compliant k y C, A m L. You have to give over tons of information or illegal like THEE. And so that's my next question. What if one day the government was like, you know what, you can't banks, Bank of America, Wells Fargo, Charles Schwab, you can't make transfers to coin base, you can't make transfers to etcetera. Whatever.
And the industry is still not that big, so you know, they're probably not gonna have much leverage to fight back. Do you worry about that? And could the ecosystem still thrive? Could it still be as a liquid if Western market regulators just said, you know, you're not allowed to deal with this. I mean, look, I think government's it's strange. Actually, once you have a full comprehension of what bitcoin kind of makes possible, it's bizarre that they haven't tried to
kill it more aggressively. That's what I think. It's really weird, and I think over time they're going to regret it in a big way. Lationship. But but let's just for a second imagine that governments have all done something they've never been able to do. A plus of all agreed
that we're all going to band bitcoin whatever. Okay, so the price really tanks, it becomes um something that's much harder to get obviously, but even so, let's say I'm in China five years from now, and it's become completely very difficult to to get and I can't use there's no more cash in China, so like it's very difficult
to to buy or sell. I mean, I could still invite my friend over to my house and he could help me with homework or something, and I could pay him on we Chat for helping me with homework, and on the side, using two non k y C wallet's, you know, he could have sent me bitcoin. Like, I don't think you can get rid of it. I think it's it's open source software. I mean, it's it's almost like an idea. It's very hard to kill. So I
think you can. You can damage the price, but ultimately, as long as the mining continues to chip away and process the transactions. And what's really interesting is that Cheese and Ping, because he's so authoritarian, what we're watching is some mining move out of China because it's too it's too strict, and it's decentralizing and going to other places. So as long as mining itself can be done, then I think the network will will survive um and and
provide this very important thing that we I think we need. Alex, that was a great conversation and I really appreciate you joining us. Super fun. Thanks. Thanks Alex, that was really interest time. So Tracy, in the beginning, I sort of speculated that maybe this conversation would be one where we kind of saw eye to eye and maybe it sort of fit within both of our views on the space. But I'm curious if you felt the same way, because it felt like we kinda it felt like it kind
of made sense. First of all, twenty or thirty minutes later, I still haven't forgiven you for calling me crank curious. But secondly, look, I'm totally on board with a conversation about the privacy threat posed by new technologies and specifically by digital payments. I just got back from China, where by the way, I had to register my I D in order to get on alley pay uh, and it's very very clear that every transaction on there is recorded.
So absolutely it's a concern. I still have my doubts about whether or not bitcoin is the solution to it, and the big question I have, and this sort of
gets to like old theories from international relations. The big question that I have is whether or not states are going to allow their sovereignty or their power to be undermined by this thing that is very clearly you know, it's almost explicitly stated in the white paper and the way cryptocurrency enthusiasts talk about it, something that is clearly
aimed at undermining or bypassing their authority. I completely agree, and to Alex is a point at the end, if you think through the implications of this and actually just sort of like go several steps down the road, it is very surprising that any government is even in the West, has been as tolerant as they have. Not only have they not like really cracked down, like actually have like regulated futures and stuff like that that add liquidity to it.
Like it's really weird because if you really think it through, and I almost wonder whether they will, um, you know, come to regret it, and you sort of wonder if cowt they're like cowed by this idea is like, oh, we don't want to stifle innovation. And someone came in and gave a presentation about blockchain, and they got am really excited. But it does seem like if you're really just sort of like follow the thread the clashes, you
will you would expect them to intensify over time. So here's something you'll like almost two years ago to the day. And I hate to do this, but I'm going to refer to one of my previous tweets, So I tweeted, it's obvious regulators are going to end up regretting not acting on more and sooner. On the one hand, if it fails miserably, there are going to be burned investors. On the other hand, if it's a wild success, their
authority or efficacy will be threatened. Like to me, it's so so clear they're going to regret this down the line. I completely agree. One other point that I thought that Alex made, which was really I find to be very compelling and a good question to pose to people, is if we can establish that there is something concerning about the end the fact that every one of our transactions will be traceable online with the trans with the trend
we're going to. His point is like, Okay, maybe there's a better solution out there to digital cash bearer assets that allow me to pay you without person ce being able to see or approve of the transaction. But they certainly don't exist yet, and no one has really put forth a better, more compelling idea. Some people talk about central bank digital currencies that could be designed as cash replacements. That doesn't really seem like many central banks are enthusiastically
embracing that right now, but it's certainly true. As to his point, it's like, Okay, well, like, if we can accept that it's a problem or it should be of a cold certa into society, then what do you propose as the better approach to enabling these kinds of transactions? And right now, I don't think many people have thought that question, or let alone come up with good answers to it. No, that's true. It feels like more people
should be working on it. And the other thing I would just throw out is there's sort of a convenience aspect to all of this, which sounds terrible because we're talking about human rights. But what I mean by that is there are ways to bypass the system or conceal your identity currently, so Alex mentioned gift cards, of course, and then you know you have people in Syria who are using bitcoin and then exchanging it via a Facebook platform.
The problem with all of those things is that it's an extra step in making the transaction and you have to put some effort into it. And the thing with all of the new digital payment systems like Ali pay, like we Chat, Venmo, whatever, is there's just really easy to use and really convenient, and people are willing to sacrifice their privacy for the sake of convenience, which you know is terrible in the long run, but you could
see why people do it in the short run. And I'm not sure anyone has really come up with a response to you know, human nature. Well, I will, I completely agree, And I think this is also one of the key things to think about, which is that people look at the difficulty of using bitcoin and they compare it with PayPal or Visa or Ali pay or whatever we chat, and they're like, yeah, it's really it's really cumbersome.
It's difficult. It's difficult for even season people. But if you compare it not to reach at, but compared to some other means for moving moving money in and out of say a repressive regime, think, for example, of the steps that people in China go to, or they like pay some junk at operator to take them to Macau. Then they play back around for several hours, lose a bunch of money doing that, cash out their chips et cetera. If you compare bitcoin to that versus we chad, suddenly
Bitcoin actually looks like the more convenient thing. So I think, like a the convenience is a big detriment to privacy. But as more people perhaps feel they must have a censorship free solution or they must engage in a transaction that's not allowed, then you might, over time start to make the convenience case for bitcoin not by compared gets to Ali pay, but by compared it to something way
more uh convoluted. Yeah, so all we need someone to do is to create a reasonably convenient method of bypassing the existing financial system without sufficiently angering the authorities so that they crack down on it. Good luck. But if if anyone has any better ideas, we'll have them on Yeah, tell us let us know. Alright, this has been another episode of the Odd Thoughts podcast. I'm Tracy Alloway. You can follow me on Twitter at Tracy Alloway, and I'm
Joe Why isn'tal. You can follow me on Twitter at the Stalwart, and you should definitely follow our guest on Twitter, Alex Gladstein. He's at Gladstein. And be sure to follow our producer on Twitter, Laura Carlson. She's at Laura M. Carlson, as well as our substitute producer Today, our old producer who's filling back in for the day to for Foreheads. He's on Twitter at foreheads t and follow the Bloomberg head of podcast, Francesco Levi at Francesco Today. Check out
all the Bloomberg podcasts under the handle at podcasts. Thanks for listening.