Andrew Ittleman - Criminal Defense Attorney

Andrew IttlemanAndrew Ittleman, partner at Fuerst Ittleman David & Joseph, expert on bitcoin legal issues.



Interview with Andrew Ittleman on Bitcoin Legal Issues

Trace Mayer:  Welcome back.  We have an excellent interview today.  We have Andrew Ittleman.  He's a partner at Fuerst Ittleman David & Joseph, a Miami based attorney and specialist in money transmission and in money laundering law.  Welcome to the podcast, Andrew.

Andrew Ittleman:  Thanks for having me.

Trace Mayer:  So first can you give us a little bit of your background.  Personally I'm an investor in gold money.  It's very analogous to a major case that you handle.

Andrew Ittleman:  Sure.  So I am a criminal defense lawyer by background.  I graduated law school in 2004.  I was doing typical criminal defense work.  Violent crimes, drug crimes, sex crimes.  You name it; I did it.  I left the firm that I was with right out of law school and I met Mitchell Fuerst, who is my partner now and I was introduced to more of the white collar criminal work that I did for quite some time.

The first case that he had me working on actually involved somebody who is manufacturing a fake version of Botox.  They were prosecuted by the U.S. Attorney's Office in Florida and the FDA participated in the criminal investigation.

Egold; the case fell on my desk right after Christmas in 2005, when the company had its first bank account seized.  I represented Egold in their forfeiture case that came out of the bank seizure as well as part of the criminal prosecution and the appeal that was taken to the D.C. Circuit relating to part of the seizure issue.

We made good law in the D.C. Circuit, but that was pretty much the end of my involvement with Egold, but what Eagle did introduce me to was two critical things.  One was the concept of digital currency which was the first time that I ever called money into question.  I've never done that before.

And secondly was, how money transmitting businesses are regulated in the United States.  And what I started seeing and paying attention to was in the years after 9/11, there was a wave of criminal prosecutions.  Egold being one, dealing with the concept of an unlicensed money transmitting business.

And after 9/11 and the Patriot Act that the 1960 statute was changed to eliminate the specific intent requirement.  It became a general intent statute meaning that the government didn't have to prove anybody's guilty mind in order to prosecute a case.

But in these criminal cases between about 2003 and 2009 again, Egold being one the criminal litigation, typically focused on what's a money transmitting business.  How are we going to define that as a society and then if we do have a broad definition, are these different licensing statutes going to apply to all of them?

That was a very good education for me and it got me ready to represent some of the bitcoin companies that I'm working with now.

Because as we've seen FinCEN is regulating them as money transmitters and is applying the concept of money transmission very, very broadly to eliminate certain exceptions that used to apply, for instance, if a company was acting as a payment processor or even just a seller of currency or currency exchange.

Those things were typically regulated as things other than money transmitters, but now that's all falling into the money transmission category.

Trace Mayer:  And during your presentation down here at the Latin American Bitcoin Conference, you talked about just how broad FinCEN wants to define this money transmission activity.

Andrew Ittleman:  Yeah.

Trace Mayer:  That it could even be smoke signals.

Andrew Ittleman:  Right.

Trace Mayer:  And that's a direct quote from one of these FinCEN officials, right?

Andrew Ittleman:  Yeah.

Trace Mayer:  Could you go into that a little bit about how critical the activity component of this money transmission is and how broad they're trying to interpret it?

Andrew Ittleman:  Well, I mean, they are interpreting it as broadly as possible.  As it relates to bitcoin legal issues, there really doesn't seem to be much of a limit in terms of how broad the money transmission definition is.  There used to be exceptions for, let's say, payment processors and the currency exchanger's typically regulated as a currency exchanger

But now companies that are simply buying and selling bitcoin with their customers or a company that you can go to, to buy bitcoin just to yourself without there being a third party participant in that transaction.  Even that's being regulated as money transmission by FinCEN.

I can guess as to why they're doing it.  They're casting a very wide net possibly while they're waiting for more specific laws to develop in Congress.  This seems to be a good way for FinCEN just to tap on the brakes of the development of the industry which happens for a lot of reason.  I mean, you know, some good and some, you know, maybe not so good.

But the U.S. government is never going to let a drastic change occur if it can avoid it because they can be upsetting.  They can upset the markets and there's a lot markets and this may just be a way for FinCEN to get tap on the brakes and try to gain control over a very rapidly expanding business.

Trace Mayer:  What area of the money transmission law do you think is kind of the most worrisome?  I mean, we've got these no specific intent criminal statutes, a very wide net.  Are we looking at potential like criminal like constitutional issues in terms of due process or are things void for vagueness, are they overly broad, do they not pass constitutional muster, are they just not defined?  For example, we have dollar limits on a lot of these things.

Andrew Ittleman:  Yeah.

Trace Mayer:  But we don't even know what the definition of a dollar is under federal law.  It's unintelligible according to Dr. Vieira, who practices before the U.S. Supreme Court, four degrees from Harvard, has written a leading treatise Pieces of Aid, a 1700-page monetary jurisprudence treatise.  So where are kind of the issues and what can the industry do?  I mean, should we be seeking advisory opinions in some cases.

Andrew Ittleman:  Well, there's a lot of questions there and I'll do my best to answer them serially.  Many of these issues, many of the legal issues that we're talking about now including the constitutionality of the general intent aspect of the 1960 statue were raised in these prosecutions between 2003 and 2009.  And they didn't go very well.

The problem with the way that the one 1960 statute is prosecuted is that it ultimately puts criminal court judges in the position of writing new law, applying these very broadly written statutes to some very technologically revolutionary business models and transaction models.

And across the board, the criminal court judges have said yes, that's money transmission and that's governed by the 1960 statute and the government doesn't need to prove your intent in order to convict you of having violated it and that's just how it's been across the board.

And I think, you know, Charlie Shrem raised a similar defense in a motion to dismiss and that was denied as well.  Criminal Court judges are going to interpret the 1960 statute as broadly as its written, and it's written really broadly.  Basically, it says that if you're in the business of transmitting money, you're a money transmitter and regardless of what the IRS have to said they are treating bitcoin as money in most cases.

Trace Mayer:  But when we're talking about the definition of money.  Even one of the FinCEN officers, he told you that if you're transmitting value whatever value is because it's subjective based on individual feeling.  If you're transmitting that via smoke signal he says that's still money transmission.

Andrew Ittleman:  Right.  You know, it's interesting.  There is that thought process and I can expand on that more.  But you know at the same time Texas and Kansas have taking very different positions.

Trace Mayer:  Than New York?

Andrew Ittleman:  Well.

Trace Mayer:  Or from each other also?

Andrew Ittleman:  No, Texas and Kansas have both come out with advisory opinions saying that bitcoin is not money and therefore we're not going to regulate you as money transmitters.  But those are outliers in terms of what the other regulators have done.

Trace Mayer:  Yeah, but Texas is big and the only other real regulator seems to be Luskey in New York.

Andrew Ittleman:  Right.  You know, we can get into those proposed regulations.  I think that ultimately with Luskey you may have a situation where -- as a society, I think that we need to make a decision as to whether we want to, every time a new technology comes out, write new laws to govern that technology or apply existing laws to the new technology and there's never really a perfect answer.

There's a criminal case from the U.S. Supreme Court back in the 40s.  It's called United States v. McBoyle.  In the McBoyle case, a person had stolen an airplane, had brought it across state lines and was prosecuted with having shipped a stolen motor vehicle in interstate commerce.  And his defense in the case was that this is an airplane.  It's not a motor vehicle.  And all the courts took a look at it until the Supreme Court said well, it moves and it's got a motor.  It's a motor vehicle.  And the Supreme Court said hell, no to that.  In that case, the Supreme Court required the government to write new law governing the shipping of stolen airplanes in interstate commerce.

Trace Mayer:  Because motor vehicle was overly broad.

Andrew Ittleman:  Exactly.

Trace Mayer:  And therefore didn't pass constitutional muster.

Andrew Ittleman:  Right.  And so that's great on the one side constitutionally.  But then on the new side, you take a guy like Luskey saying, "Okay, I'll write new laws for that."  And then well, now we're dealing with that issue.

Trace Mayer:  Isn't that what's really difficult with bitcoin is actually pinning it down definitional about what it exactly is?

Andrew Ittleman:  Well, in terms of regulation and what we're seeing in the U.S. given that there's a number of different federal agencies to come out and comment on bitcoin legal issues, bitcoin is going to be regulated not based on bitcoin as a thing, but based on how it's used.

So the SEC can regulate the issuance of bitcoin related securities and if bitcoin is being used itself as a security CFTC can come out and regulate it as a commodity.  FinCEN can come and regulate it as money transmission.

Trace Mayer:  But can't that be overly broad and therefore not pass constitutional muster?

Andrew Ittleman:  Well, it's not an issue of the breath because all of those agencies certainly have the right to regulate in the bitcoin space.

Trace Mayer:  Do they?  Under the Supreme law of the land they may not.

Andrew Ittleman:  Well, if they're going to regulate bitcoin depending on how it's used.  That's one thing.  The problems going to arise if they're regulating it inconsistently.

So if one federal agency is saying something completely different from another and it puts the bitcoin related company into a position where you cannot possibly comply with both. That is what's going to raise the issues.

I don't see there being an issue of the power grab itself.  I see the issues coming when it becomes impossible to comply with both.

Trace Mayer:  One of the interesting things about the block chain is first is that it's just the organization of zeros and ones.

Andrew Ittleman:  Yes.

Trace Mayer:  Second, is that you can include in the block chain specifically organized information.  For example, people have included prayers in the block chain.

Andrew Ittleman:  Yes.

Trace Mayer:  People have included political speech in the block chain.  And last I checked in the supreme law of the land it says that Congress shall make no law regarding the freedom of speech or of the press.

And so when we're looking at bitcoin in the mid-90s, Zimmerman fought the crypto wars and the U.S. Supreme Court upheld cryptography as freedom of speech, under freedom of speech protections, under the Munitions Act.

Andrew Ittleman:  Yes.

Trace Mayer:  So is not the argument that bitcoin is merely speech which is what it is at its most basic component and I gave a presentation about this at the bitcoin conference in San Jose in 2013.  You know, what is bitcoin?  It's speech at its most basic core.

Andrew Ittleman:  You could say the same thing about money.  About money generally.  Really money, when I give you a dollar the dollar is just a piece of paper, but it memorializes value.  It memorializes the transaction itself.

Trace Mayer:  Yeah.  But we have constitutional jurisdiction with money.  Article 1 Section 8 Clause 5, to coin money and regulate the value thereof.  Notice it says to coin, not to print and then we have the limitations in Article 1 Section 10 Clause 1, that no states shall make anything legal tender except its gold and silver.

Andrew Ittleman:  Right.

Trace Mayer:  Which is interesting because how do we make Federal Reserve Notes legal tender when they're not gold and silver.  Only the states can make something legal tender.  So how is the federal government making anything legal tender?

Andrew Ittleman:  These are very good questions and unfortunately, I don't have the --

Trace Mayer:  Are they just acting unconstitutionally or do they actually have any jurisdiction anywhere to make stuff legal tender?  Because under Article 1 Section 10 Clause 1, no state shall.  Under the 10th Amendment any powers not delegated to the federal government are reserved to the States or to the people themselves.  Where does the federal government get authority to make anything legal tender to define what money is?  The constitution doesn't even define what money is.

Andrew Ittleman:  Yeah.

Trace Mayer:  If we're going to have money transmission, we need to have clear definitions.  Particularly, when you have no specific intent criminal penalties for felonies.

Andrew Ittleman:  Yeah.

Trace Mayer:  For constitutional due process.  I mean, we have the 4th, 5th, 6th Amendments to deal with and comply with also.

Andrew Ittleman:  Yeah.

Trace Mayer:  At least constitutionally.  I mean, how many shields of the Constitution can get raised in this area?

Andrew Ittleman:  All of them.  But again, I think a lot of these issues have been called into question already in the courts in a number of different capacities.  From what I understand, and I haven't looked at a lot of these issues in a while, they haven't gone well.  A lot of the issues have been raised by tax protesters believing that the federal government --.

Trace Mayer:  Yeah.  But is this an area where perhaps the bitcoin foundation or the Chamber of Digital Commerce could step in and be seeking advisory opinions so that we're not actually dealing with bad facts.  You know, because in many cases bad facts make bad law.

Andrew Ittleman:  Correct.

Trace Mayer:  And like why should we be letting someone like Charlie Shrem be the one that's like a test case or guinea pig?  Like, why not be seeking advisory opinions in this area?  Is that something that could be a potential solution for the industry?

Andrew Ittleman:  Well, companies are doing that.  And that's how FinCEN is coming out with its various opinions.

Trace Mayer:  Well, no.  I don't mean just opinions on FinCEN.  I mean, seeking advisory opinions from District Court judges.

Andrew Ittleman:  Oh, no that doesn't exist.  The District Court judges do not have jurisdiction to write advisory opinions of that nature.  The Constitution requires them only to issue opinions when there is an actual case of controversies.

Trace Mayer:  To be settling cases and controversies.

Andrew Ittleman:  Right, exactly.  There has to be a case of controversy.  Which is why with respect to money transmission --

Trace Mayer:  Could the case in controversy be saying I don't think I need to register as a money transmitter with FinCEN.

Andrew Ittleman:  It would have to be the other way around.  It would be FinCEN requiring you --

Trace Mayer:  Well, they have with their regulatory opinions, aren't they?

Andrew Ittleman:  But there's no case and controversy until there's some sort of an enforcement action against you and you can even try to sue the government for having issued this advisory opinion in a way that you believe to be un-lawful.

Trace Mayer:  Well, wouldn't the advisory opinions in a way be a prior restraint on the freedom of speech and how one wants to use this block chain technology?

Andrew Ittleman:  Theoretically, yes.  But again most District Court judges will not take on that case until the term is right and they will not deem the case to be right until there is an enforcement action against it.

Trace Mayer:  But you've got potential criminal statutes that is prior restraint on your speech.

Andrew Ittleman:  You are absolutely right.  But again even with some of the civil rights cases going back to during Jim Crow, the 40's, the 50's and the 60's a lot of those types of First Amendment issues weren't -- they couldn't really raise them until unfortunately people were hurt and arrested.  And that's just the way that the Constitution limits the jurisdiction that District Court judges have.  There has to be some sort of enforcement action.

Trace Mayer:  And so would you say this is one of the main reasons that we have such a chilling effect in the U.S. at least regulatorily on the bitcoin industry.

Andrew Ittleman:  I think that there's something to be said about that, but I would imagine it's something that the framers of the Constitution brought into question when they were dealing with that.  They wrote the cases and controversies requirement into the Constitution to limit the power that District Court judges have.

Because ultimately you're talking about something that's either a legislative in nature or regulatory in nature.  So that jurisdiction has been given specifically to the Congress and to the executive.

Trace Mayer:  Or in some cases, it hasn't because Congress shall make no law.

Andrew Ittleman:  Right.

Trace Mayer:  Regarding freedom of speech.  I mean, unless there's an incitation for imminent violence where is the clear and compelling interest to regulate this form of political or religious speech?

Andrew Ittleman:  Well, again, you have a checks and balances issue.  Each of the branches of the government is designed to be a check on the power of the others.

Trace Mayer:  Which is one of the primary problems we've got where we don't have a definition of the dollar and we have legal tender being made that doesn't have any constitutional authorization.

Andrew Ittleman:  Right.

Trace Mayer:  And so that takes the power of the purse and gives it to different areas of the government or not even governmental actors then what was intended by the framers to begin with.

Andrew Ittleman:  Right.  But again it's another good example of a check and a balance where the Congress is supposed to be writing appropriations laws which give the different federal agencies the money that they need in order to operate.

But again the various federal agencies are at the same time under the power of the executive branch, the government, the President and so that in and of itself is another good example of a check and a balance that's embedded in the Constitution.

Trace Mayer:  So, we've got another very interesting issue because with a lot of these money transmission laws, like, currency transaction reports $10,000, right.

Andrew Ittleman:  Sure.

  Money and Bitcoin Legal Issues

Trace Mayer:  But, what is a dollar?  Under 18 U.S.C. 15101 through 15118, we've got one ounce of silver equaling one dollar; we got $50 equaling one ounce of gold, we got one dollar federal reserve notes like which particular form of value or dollar sign I mean which one do we use on these reports and why do we use that particular one?

Andrew Ittleman:  As far as the dollars are concerned?

Trace Mayer:  Yeah.  I mean, because the 1792 Coinage Act it 371.25 grains of fine silver was the definition of a dollar and we have the term dollar used in the Constitution in multiple areas like the Slave Provision and that was hotly debated.

So I mean the definition of a dollar for these money transmission laws especially when we're talking about potential criminal penalties.

Andrew Ittleman:  Right.

Trace Mayer:  I think it's very important that we have due process in terms of notice of what that term means and constitutes.

Andrew Ittleman:  Right.

Trace Mayer:  Right, I mean, what do we use for it?

Andrew Ittleman:  I don't know the answer to that question.

Trace Mayer:  Well, shouldn't it be clear though.

Andrew Ittleman:  Hypothetically, academically speaking, yes, it should.

Trace Mayer:  Or do we just have very, very fuzzy criminal law in the U.S.

Andrew Ittleman:  No.  It's not fuzzy.  It's just broad.

Trace Mayer:  And inconsistent.

Andrew Ittleman:  In some cases, they're inconsistent, but the inconsistency really only raises a constitutional level when again it puts somebody in a position where he can't possibly comply with both.  But the laws are written very general and unfortunately money transmission is one of them.  And it's being interpreted in the broadest possible way right now with respect to bitcoin legal issues at least.

Trace Mayer:  Switching gears.  What about self-incrimination and key disclosure laws?  Is there anything you'd like to talk about in that particular area?

Andrew Ittleman:  So I've had cases where -- and it does raise very interesting Fifth Amendment concerns.  The Barry Bonds case involved something along those lines where his personal trainer was required by a judge to disclose certain information about him and he refused to do it.  He is ultimately held in contempt and during the Bond's case the trainer did I think 18 months behind bars simply because he refused to testify and they were trying to compel him to testify, but similar issues exist in the bitcoin space.

And I've had cases where clients have been ordered to turn over or at least requested in a grand jury investigation to turn over PGP keys for instance, private keys.  They refused to do it and ideally, there you can come up with some sort of a compromise with the government where maybe the client would open or decrypt one document at a time with maybe somebody from the FBI watching over the process.

That's one way to compromise.  But, yeah, it raises significant Fifth Amendment concerns, very significant.

Trace Mayer:  I was actually presenting to a major bank with members of the FBI in IRS criminal investigations who were counterterrorism.  And the special agent from the IRS was talking about, I think, a child porn case where they had the computer at the border.

They had asked the subject to enter the decryption password which he did.  They found the illicit material on the computer and then, I think, the FBI agent inadvertently unplug the computer and so they like plugged it back in and tried to boot it up and they're like, "We'll put the encryption key in again" and he refused to do it.

And I think, the Special Agent said that he was protected against putting that encryption key in because of self-incrimination.

So it's very interesting.  We have the FBI director calling for Apple to build back doors into their inscription.  We have the NSA with Snowden revelations that where all of this has been tapped into compromising the data of major corporations leading to large scale identity theft and potential personal information breaches.

And so the market is just going to be moving in that direction of securing data anyway.

Andrew Ittleman:  Sure.

Trace Mayer:  And so I think this is kind of a big perfect storm all brewing up.  We've got money transmission.  That's a form of speech, but it's protected by private keys that puts it beyond the reach.

Andrew Ittleman:  Oh, sure.

Trace Mayer:  And I mean, we really got kind of a big mess brewing, don't we?

Andrew Ittleman:  Well, it's a brave new world.  You know, I do know that the government is very actively watching the bitcoin legal issues, very actively watching.  They're very familiar with the block chain technology.

Trace Mayer:  And these are agents who under federal code have sworn an oath to uphold and defend the Constitution so help them God, right?

Andrew Ittleman:  Right.

Trace Mayer:  Like, they have sworn that oath.

Andrew Ittleman:  Right.  And I'll tell you that the meaning of a lot of these terms that are embedded in the constitution there's never going to be one clear cut answer for them.  The Supreme Court deals with that sort of thing every single day and you can have nine different Supreme Court justices each having their own rules of how terms in the Constitution should be interpreted, from the most conservative to the most liberal, and you will have that as long as the United States is a country.

It could go on like that for hundreds of years where these basic core terms is always going to be issues of fact coming up that are interpretable.

Trace Mayer:  And they'll just change; Plessy v. Ferguson.

Andrew Ittleman:  Correct.

Trace Mayer:  Brown v. Board of Education.

Andrew Ittleman:  Correct.

Trace Mayer:  Like, they'll just change their previous decisions.

Andrew Ittleman:  Yeah.  And that's why it just shows how complex sometimes these very basic terms can really turn out.  Money transmission is a perfect example.  Just two words.

But exactly how we interpret it will be the subject of debate, litigation and as new products are developed there's going to be new lawyers coming in to write opinions for those new companies and it's going to go on like that, just based on this term money transmission, conceivably forever.

Trace Mayer:  Now what's interesting when we look throughout all of history, when we have this currency crises and financial turmoil like we had in 2007, like we had at the founding of the U.S, like we had with the reign of terror, like we had in Weimar, Germany.  Societies they're posed with, you know, two potential outcomes, repression or regeneration.

Andrew Ittleman:  Right.

Trace Mayer:  And so it looks like the U.S. is being posed with this issue.  Do we make it so that you can be held in jail, contempt of court, no ability to challenge your detention or appeal for not disclosing speech that they can't prove that you absolutely have?

Because there's possible deniability with whether you have a private key or not.  So, you know, the ultimate form of legally sanctioned tyranny looks to the end outcome or the U.S. could go the other route and have a much more free and open society in terms of speech.

Andrew Ittleman:  Yeah.  Well, listen.  It's just never going to be perfect.  The system wasn't designed to be perfect.  It was designed to be flexible and it was designed for there to be give and take between fostering innovation and making sure that the people who are affected by these various innovations are protected.

Money is another good example.  We want to try to loosen the market as much as we can so that businesses can come into play, but we want to make sure that they're not allowing money laundering violations to occur and bad people and bad countries to have access to financial services etcetera, etcetera and it's constantly developing and it's never going to be perfect.

As soon as we get a system and the laws are written, the technology is going to move forward and the laws that are written today are going to be dinosaurs.  And that's just the job that the government has in front of it.  It's essentially a thankless position to be in.

Trace Mayer:  Well, and I let the FBI special agents and the IRS criminal special agent know like, "Look, you guys have dragons out there."  There are bad people.

Andrew Ittleman:  Oh, yeah.  There are.

Trace Mayer:  There are some really, really bad people out there and they pose a significant threat to society and our law enforcement, for the most part, they're hunting those bad people.

Andrew Ittleman:  Yeah.

Trace Mayer:  They are, I think, doing a very good job.  I have lots of family that are military and law enforcement and stuff like that, but at the same time we have things like the Constitution to restrain that huge amount of power.  Like Justice Roberts in his confirmation hearings, he was talking about how you have the full force and might of the U.S. government and all of the military machinery and everything and he, as a lawyer, can stand and hold that violence in abeyance.

Andrew Ittleman:  Right.

Trace Mayer:  That's the power of the rule of law.

Andrew Ittleman:  Yeah, it is.

Trace Mayer:  And if we don't have the rule of law, what does that bode for our society?

Andrew Ittleman:  Again, it's never going to be perfect.  It's just not.  It's never going to be perfect and one person's interpretation of perfection may be completely different than the next guy's.

I think it's a system that's designed to be flexible in nature, to take into consideration all of these wonderful opportunities and to try to help protect everybody from the bad things that can happen too.

It needs to be flexible.  It needs to give and take.  There's always going to be things that they do wrong, but there's hopefully going to be things that they do right also.  And at the end of the day, they'll counterbalance one another.

Trace Mayer:  We're kind of getting a little long on the podcast, on the interview.  We're getting into just stuff that is really, you know, this is what a lot of people kind of get inspired about when they think they're going to law school is dealing with these real fundamental tectonic areas of the law which really just represents the values that we as a society hold.  Do we encourage freedom of speech or do we throw Galileo under house arrest?

Andrew Ittleman:  Well, you know, we're right now; we're sitting in Rio de Janeiro, Brazil.  And all of these issues that we're talking about become that much more complex when we start talking about them in the sense of international law.  The relationships between the various countries who do business with one another.

The complication that arises when a company in a nation that has currency control in place needs to access some sort of a product or service in the United States.  The international movement of money, the money laundering risks that occur, the treaties that exist between the nations.  All of these come to play.

Trace Mayer:  Tax information, exchanging agreements.

Andrew Ittleman:  Oh, my god.  All of it.

Trace Mayer:  I mean, it's all part I think of just humanity's journey from the swamps to the stars.

Andrew Ittleman:  Yeah.

Trace Mayer:  You know, we learn by our own experience, we make mistakes that result from bad ideas.  You know, really bad mistakes like Mao and Hitler and Stalin.

Andrew Ittleman:  Right.

Trace Mayer:  We make good choices.  Like Isaac Newton is master of the mint developing the gold standard.  The founding fathers with constitutional protections and provisions that have led to a free and open society that has really blessed the world with democratic based government rule of law.

Andrew Ittleman:  Right.

Trace Mayer:  What are you most optimistic about in this space?

Andrew Ittleman:  All right so that's a really --.

Trace Mayer:  You know, like to close this of, I mean, what are you optimistic about?

Andrew Ittleman:  So let me answer that, because I've done a lot of thinking about that.  The first time I saw Vitalik Buterin speak.  It was a very enlightening experience for me for a number of different reasons.

First of all, Ethereum just blew me away.  When you think about the fact that it was last January, and he was 19 at the time.  And you take a step back and you think about the perspective that a 19-year-old has on a planet that we live in and the United States for instance.

A 19-year-old would have been at the time maybe seven when 9/11 occurred.  And a 19 year old doesn't have the same appreciation for institutions that I do.  And I'm only 35.  But I'm 35 and I can remember a time when people didn't unanimously hate banks and I'm 35 and I can remember a time when people had pride and felt a very strong feeling of patriotism.

I can remember when the Berlin Wall fell and I can remember how I felt, you know, watching President Reagan speak to those people the way that he did and directly lead to the end of communism.  I can remember that.

19-year-old has no recollection of that.  He wasn't even alive when that occurred.  At the same time a 19-year-old for his entire existence has been plugged into Facebook, has been plugged into the Internet, has received throughout his existence an unprecedented amount of information, good and bad.  What I think we're seeing now both in the bitcoin legal issues and elsewhere in these millennials who we'd like to talk about is that they're calling things into question.

They're raising questions about these institutions.  They're raising questions about banks.  They are raising questions about our government.  They're raises questions about money.  That's what we've been talking about this whole time.  What's money?  Can I make it better?  Can I make it more efficient?

And I think that all of that is the product of just this unfiltered fire-hose of information that's been fed to them throughout their existence.  And as much as we can say about millennials being this or millennials being that, I think that some of the things that they're doing with bitcoin-related technology is its awesome and it's going to change the world.

If the bitcoin community can accomplish 10% of the things that it wants to accomplish the world as we know it, I think, in 35 years from now it's going to be just drastically different, at least as far as the way that we do business with one another.  And I think that's awesome.

Trace Mayer:  I would have to agree with you.  We had the Gutenberg Press, romantic novels.  150 years later, the scientific journal which introduced to the world the new form of arguments, led to the rise of the natural philosophers, the brightest minds, the brightest scientists.

Copernicus wrote a treatise on interests and money,185 I.Q.  Newton developed the gold standard, 195 I.Q.  Two standard deviations higher, Johann Von Goethe absolute polymath.  In Faust Part Two, he writes all about the negative effects to society in poetic form.

Andrew Ittleman:  Yeah.

Trace Mayer:  When we debase the currency unit.  With our modern day people, you know, like Vitalik and Adam Back repression or regeneration.  And, you know, all of these democratic forms of government, we say that our laws are open and that we're able to have community government you could say.

But when we look at the new form of argument that we have, that the internet has introduced things like GitHub.  On GitHub we have things that are called diffs.  There are differences in the software code.  We see what's added or subtracted, one's in red, one's in green and so we're able to see the exact differences that are made.  Complete transparency in the form of argument on this version control.

And the law is a form of version control.  But we have to pass the law to find out what's in it before we get the diff.  As programmers, we take this ability to have a diff for granted and yet no democracy in the world offers us this form of argument.

Andrew Ittleman:  Right.

Trace Mayer:  I think we're going to see the internet in this Information Age revolution that's coming, you know, there's change from the agricultural to the Industrial Age and now from the Industrial Age to the Information Age.  It's coming.  It's been introduced by technology.

It just is what it is.  It's going to work itself out.  Humanity's going to hopefully not destroy itself in the process.  And we see this rising generation that are digital natives like Vitalik taking these tools and building a new world with them.

Andrew Ittleman:  Yeah.  With bitcoin, I think that it all comes down to the open source nature of it.  Because it allows all of that genius to participate on the same platform and everybody can make it better.  Everybody can put their collective genius together and --.

Trace Mayer:  And they all have access to all of the source code all of the time.

Andrew Ittleman:  Right.

Trace Mayer:  So there's complete transparency in that sense.

Andrew Ittleman:  And that's why, I mean, you look at the state of the bitcoin space.  It's moving so fast and I think it's specifically because of that.  It's allowing all of this genius to work together.  Even people who've never even met one another.

They're communicating with the same language.  They're all putting their genius in -- as hard as they can.  You know, fortunately there are you know VC firms that are backing a lot of this now with real money and it's racing forward.  And from a regulatory perspective, it's just awesome to be a part of.  It's really fun.

Trace Mayer:  Well, thanks so much for being on the podcast with us delving into some of these more philosophical or legal issues, the moral issues, the optimism for the future despite all the change that we're in.

We've had Andrew Ittleman, partner at Fuerst Ittleman David & Joseph, a leading money transmission attorney, criminal defense attorney.  Thanks for being on the podcast with us.

Andrew Ittleman:  Thanks for having me.

Written by Andrew Ittleman on February 5, 2015.