Video - Bitcoin is the Real Electronic Cash - Merkle Conference 2016

This talk took place on October 11th 2016 during the Merkle Conference in Paris, France. He speaks about Bitcoin and its origin.


MAN: Please welcome Andreas Antonopoulos for the first time in France.

ANDREAS ANTONOPOULOS: (Speaking French). I tried to translate some of the words using Google. I asked translate for me the word “Blockchain” and Google said (0:01:06) and that seemed a bit strange and it said (0:01:12) lu Blockchain and I thought isn’t it la Blockchain and I asked what is Blockchain and Google said Minitel. I asked for the translation of Bitcoin and it said (0:01:30) and finally I said how do I explain the Dow to a French audience and they said just say Etienne. And at that point I quit. So I will deliver the rest of this presentation in English and I apologize because I cannot really deliver in your beautiful language that I spent many years learning because of more than 20 years of lack of practice.

So, I want to talk to you today about a form of payment, peer-to-peer payments that are prolific, a form of payments that are near instantaneous, transaction free, direct from person-to-person, secure, convenient and have been around for thousands of years and that form of payment is cash. But cash won’t be around for thousands of years more. Cash is going away and we haven’t quite considered the implications.

One of the beautiful things about cash is that it enables a true peer-to-peer, person-to-person economy. Cash is the way you transact in your local community. Cash is the way you pay your small shop, your music teacher, cash is the way you pay the local farmer. Credit cards don’t work like that. Credit cards and bank payment systems and mobile money and PayPal and Venmo they’re not peer-to-peer, they are not person-to-person. They’re person-to-corporation-to-corporation-to-corporation-to-person.

When did we invite all of these corporations to participate in our commerce as intermediaries? When did we invite them into every conversation? It feels the same but it isn’t. When I go to the local bakery and instead of cash I give them a credit card to me it feels the same. The experience from my perspective is person-to-person and instantaneous, convenient and without fees. But that is not the experience that the baker has. The baker doesn’t get paid. The baker doesn’t get paid sometimes for 30 days, sometime not at all because fraud has occurred. And when they do get paid 2% of it goes to someone who didn’t had any value to that transaction. They just processed it. That is if that someone, that corporation decides they want to pay the baker because if you come from a place like Greece where I come from or from Cyprus, Argentina, Venezuela, Kazakhstan, Ukraine or many other countries in the world one day the bank say “Hmm, no. Not your money anymore. You thought it was your money, it was a loan and we just default it and can’t pay you back.”

There’s something really magic about cash because as a system of commerce it has allowed us for thousands of years to interact quickly, conveniently without the people, without surveillance by governments, without corporations in between, without fees, without any of those things and now we stand in 2016 on the cusp of eradicating cash. You hear the propaganda cash is for criminals because after all who would want to pay other people when it’s so easy to just pay corporations that pay corporations that pay corporations that pay people. I didn’t invite them into my transaction, they invited themselves. And I don’t like having to make a system of commerce where it is automatically assumed that as a human being my main role is to be a consumer, not a producer of goods, not a provider of services. Because to be a provider or producer I have to receive permission, apply for a merchant account, pay fees it’s so much easier to just be a consumer. It’s so much easier to assume that from now on everything that I ever transact will be produced by a corporation and my role is to just consume. And what does that do to our society? It destroy community, it destroy small shops, it destroy freelance entrepreneurs, sole proprietors, workers. It means that every interaction you have is not with the person who made your food, it’s who the person employed by a corporation that outsources the making of your food somewhere else. And when I bought meat from my butcher if one day my butcher put wood chips, (0:07:43) saw wood, fiber into my meat I would go back and I would go “What the hell just happened. Why is there wood chips in my meat?” But if an executive at corporation who earned very prestigious MBA sees a proposal from a consultant that says ‘fiber enhancement of products plus 2% profit’ and they signed someone a thousand miles away puts wood chips in your meat and when you go back to the butcher they say “I didn’t make it. Complain to the corporation.” We’re destroying community by disengaging commerce from something that happens between people and introducing in every transaction the idea that you must always trade through a corporation that is your intermediary. That you must always lend not pay, deliver credit not value.

Cash has some unique characteristics. Cash is a system that is a push transaction. Meaning that I am authorizing someone to take money out of my pocket, I take money out of my pocket and I push it to the other person and the money they get is the money I just pushed. They don’t get to come back 10 days later and make another debit from my pocket.

How did we suddenly changed every system of payment in our society is a pool system. How did we suddenly change where every transaction I make I authorizing someone not only to take money now but maybe take money again and again or maybe lose my access controls and some hacker can take money again and again.

Cash is a bearer instrument that means the value is in the instrument itself. It’s not a promissory note. It doesn’t represent a promise that you will be paid later, it is a bearer instrument which means you are paid now. And the thing about promises is that promises can be broken. Cash doesn’t represent the issuance of debt. It represents the transmission of value. Cash is instantaneous. You get the value and can spend it immediately, not 30 days from now.

Let me ask a quick question. If I wanted to give you five euros for coffee how many of you will take Visa today? No one? You mean the only way I can pay other human beings is with cash? The thing that we are about to make illegal because apparently an ancient technology for human payments could only possibly be used by criminals. And the definition of a criminal is anyone who is into corporation, pretty much.

So, what is Bitcoin? What are these open global Blockchains that we’re talking about? What is so special about Bitcoin or Ethereum or any of the other systems that are open, global, borderless, neutral payment systems that allow open access, open innovation, access without permission, participation from anyone anywhere in the world?

Bitcoin was created by Satoshi Nakamoto and in the title of his paper he said a peer-to-peer system of electronic cash – cash. This is not an electronic bank account. This is not an electronic bank. This is not a digital credit card. This is not an electronic payment network. This is electronic cash and it has all of the unique characteristics of cash that make it so precious. It is peer-to-peer. I can pay anyone in this room five euros equivalent in Bitcoin, like that. Not peer-to-corporation-to-peer, person-to-person directly. I can engage in trade with every person in my community directly.

When I pay someone it is a push transaction which means that they receive the value immediately and they cannot charge me again for more value later. They have no access or authorization to my account. I didn’t transfer access. I transferred value, a bearer instrument. That transmission happens near instantaneously. You can spend a Bitcoin transaction five or ten seconds after I send it to you. It happens for almost no fees at all, just a few pennies, just to cover the network cost. And it allows us to do everything that cash has allowed us to do for thousands of years. Oh, except for one thing. This form of cash I can send to Kuala Lumpur in five seconds. Why? Why the hell not? Because I want to. I can send it across borders. I can send it to a farmer in Kenya, to a fisherman in Indonesia. I can send it to someone in South Africa, why? Why the hell not? It’s my money I want to trade with the world. I am a citizen of the world and with a form of electronic cash I get all of the benefits of cash plus I can e-mail it across the world in a few seconds.

Bitcoin is a very important technology because it enable us to re-engage with a concept of using money as a form of payment between people, not corporations. It allows us to engage in commerce without surveillance, without corporate interaction, without blocks on my accounts, without freezes and fees and compromises and theft and corruption. It means that my money is not sitting in a bank being reloaned to some war criminals somewhere using it to bomb some country. It’s my money, not somebody else’s money. It’s not a loan without interest to the banking system. It’s my money, it’s cash in my pocket.

This is an interesting principle really the idea that you can bring money back to three basic core principles. Liberte, fraternité, égalité. Thank you.

Written by Andreas M. Antonopoulos on November 12, 2016.