Bitcoin — more than just money | Dug Campbell | TEDxUniversityofEdinburgh

Bitcoin — more than just money | Dug Campbell | TEDxUniversityofEdinburgh


Translator: Elisabeth Buffard
Reviewer: Denise RQ I want to speak to you today about Bob because I’m worried about Bob. Now, Bob is a very hardworking individual: indeed, he actually has had
to travel to find his work, so he doesn’t live close
to his wife and family. In fact, he lives in a different country
and sends his money back. But I’m not so worried about the fact
that he has to work his long hours, although it would be nice if he didn’t. The things I’m worried about is the trust
that he has to place in the system. And it is a system in which every time
he sends his money home, he can expect some of that money
to just disappear. When it’s 414 billion dollars
sent home to developing countries, and sometimes the bank charges
have upped to 25%, we’re not talking spare change here. Why can’t Bob, with his own money, transfer whatever he likes
to whoever he likes, in an age of email
and instant communication? Sounds strange, does it not? Well, he can! And, in fact, we all can, and the way that we can do it
is by something called ‘bitcoin.’ Now, many of you will have heard
about bitcoin, perhaps in the press, they tend to have lots of stories about… words, involving words such as
anonymity, volatility, even criminality. But the reality is that the stories
the press tend to publish about bitcoin are often not the full picture. So, sure, yes, they talk about it
being a new form of digital money, kind of like the email and cash combined, a way that you can transfer value
immediately from one point to another, directly, instantaneously, across the web. And, sure, they might mention
that, in some cases, the government and the banks have
no control over this new form of currency. But that’s where they tend to leave it. And that’s a pity because in actual fact,
it’s far more than that. So today I want to talk to you
about trust, and the fact is that in a digital world, low trust
transactions are hugely important. Many years ago,
we used to live in communities where we did business face to face: we would go down
to the local shop and pay cash, we knew the people we did business with, but as the time went on,
and the economy grew, gradually this position changed
because businesses realized, with the advent of the Internet, that they would be able to
transact at distance and whilst this was exceptionally useful
for us, as consumers, very convenient it came at a cost and that cost was
personal trust could not scale. So we had a problem, so we turned to the banks
and the large financial institutions, and we asked them to create a solution
which they willingly did. They came up with a big record
which would say exactly who owned what which they kept behind lock doors. We had to pay them for the privilege
of using it, but that was fine, and always good with the world. And then, in 2008, a paper was published by an unknown, called Satoshi Nakamoto, and over night, we suddenly discovered that we didn’t actually have to trust
this third parties any more because if we chose,
we could adopt a new currency, a currency that was based
on a digital age, one which was based
on breakthroughs in computer science, and a network
that was protected by security. And a network where every additional
computer that was added would increase the power, and it had to be powerful,
and it had to be resilient because on every single computer
was contained a record of every single transaction
that would ever be carried out or had ever been carried out
using bitcoins. It’s a powerful concept. And, indeed, the network
has become increasingly powerful, and in short time since launching, we now have a computing network
that is more powerful than the combined power of the top
500 supercomputers in the world. By putting this network
together, voluntarily, we’ve discovered a financial system
which is incredibly resilient because it has no centralized organization
which can be vulnerable to attack, or influence. All very interesting, but as soon as you start
playing around with money, people don’t necessarily like it. There’s a lot of power involved, and people are
understandably attached to money, it’s one of man’s first technologies
after all, along with the wheel and fire, and they are somewhat suspicious that there was such a growth
in the value of this technology. So, for the first ever transaction that
took place was accepted to be in May 2010, when a programer in Florida paid
10,000 bitcoins to get a couple of pizzas. To put that in perspective, 10,000 bitcoins at today’s prices,
approximately, is 6.5 million dollars. It’s an incredible position
that we are in now but it doesn’t really matter
how people argue about, “Is it a currency or is it money?” because the reality is
that either will do. In fact, the real invention is the fact
that we have an invention that underpins the currency, and this invention is truly revolutionary. When you create
a networking of computers is important that the computers
will be able to speak to each other, they need to learn a language
so that they can communicate easily, and once that –language,
that rule, the protocol– is in place then others can go off and build
technologies on top of that level. For example, you might not know
too much about HTTP or, indeed, smtp, but I can guarantee you
that you know about websites, and that you’ve used email. All of this comes together to create
a technology that is incredibly powerful, and now we have to work out
what are we going to do with it because it’s so powerful
that it fundamentally changes the way that we can approach
the development of value. It gives us for the first time,
the ability to transfer a unique digital asset from one point
to another, instantaneously, without cost. Impressive stuff. But it’s also impressive
because it chooses a mirror, a total open mirror of what’s happening
in the rest of society because there’s a big fundamental
power shift taking place. What’s happening is there’s a shift from centralized bureaucratic
hierarchies of organizations to technology-driven distributed
networks of individuals. And this is happening
all over the place, so this is important because bitcoin has applied this concept
of decentralization to money, but in the same way, across society,
we have a position whereby a centralized
organization is developed to solve a problem individuals
didn’t think they could solve themselves. It’s historically true; think of media, think of the television
and the news services that we expect. An individual generally couldn’t walk
around and collect so much information and then share it
on a international scale, so we relied on media organizations
which grew up to fill the gap. But with the advent
of the Internet and social media, suddenly, you had a blogger; for example, during the Arab Spring
you had exactly the same power to publish an article directly
to the world from a mobile and to break a new story
as an international TV channel. This is incredible disruption,
and it’s happening all around the globe. Back in 1989, I vividly remember
my dad returning from the office – he was clutching a VHS video
if you remember those – and it was all about
the information superhighway, and I remember vividly
sitting on the floor in the room looking at this video that evening and watching as this pulse
of cheaply colored graphics flew across the screen and a narrator
spoke of stories of this magical future where information would transfer instantly
from place to place, just like that. But I’ll be lying if I were to stand up
here to say to you today that I could honestly see
all of the innovation and the inventions that would come as a result
of the creation of the Internet. Of course I couldn’t, of course
I couldn’t see the Facebooks, the Googles, the services that we used
every single day. We are at a similar place
with bitcoin and its very early days. In the same way that the first TV programs
were no more than us pointing cameras at people reading
scripts just as they’ve done on the radio. So, we don’t know
where this could take us; however, we do have some indication because what has been created
by this protocol, by this set of rules is the ability to transfer
a unique digital asset from one place to another,
instantaneously, without the involvement
of a third party creating expense. And we can apply that
in so many places now because with the safe secure transaction
that we can’t challenge, because it is all recorded
on a central place, we can start to transfer property. And once we start to transfer property
then things get really interesting. You may have heard of a thing
called “the Internet of Things,” it’s basically the way that physical objects are increasingly
having sensors embedded within them that enables them to be able
to communicate with wireless networks. As a result, there are more connected
devices on the planet at the moment than there are people
– which is pretty incredible already – but what the Internet of Things
brings is digital identity to objects. What bitcoin does is it brings
an economic identity. Now things get interesting
because now, for the first time, we can have computers,
we can have machines, transacting with other machines
directly, no third parties; they can transact
with individuals or companies. This has never been possible before. You might have heard B2B or B2C
this is M2B, M2C, machine. And we start to herald a new age
because we have the facility to build this and to welcome the arrival
of autonomous agents. Autonomous agents are effectively
computers that own themselves, bear with me, and what they need to do
is to have the capacity to receive and send money, so they can buy the services
that they need to keep themselves alive. An example would be a self-driving car. It could go out,
trade itself on the network, have passengers jump in, jump out,
pay it in bitcoin; the car could then use
that digital currency and pay a garage directly for a service
that it needs, such as the MOT. Crazy stuff perhaps,
but let’s bring it back to the present day why is bitcoin important now? Well, it’s important now
if I ask you this one question which is, who do you trust
with your personal data? Because the reality is I’m not asking:
“Do you trust somebody to be honest or a company to be honest
to look after your details?”, I’m asking whether you trust them
to be 100% secure for hacking. And year on year, the incidences of hacking
and data leakage are increasing massively, you just need to look at what happened to
the US chain Target a couple of months ago when up to 70 million costumers
lost personal details including credit card details,
home addresses, telephone numbers, names, the lot. You can’t trust someone else
with your details, is it almost impossible but yeah, we hand them out
when we make credit card transactions. If those customers had been using bitcoin
that would not have happened because with bitcoin, in exactly
the same way as if you were using cash, you do not tie you identity
to a transaction. However, let’s not pretend that this
innovation is all about shopping. It is far bigger than that,
and the reason it is bigger is because 1 billion people in this world
have access to banking facilities. That means that 6.5 billion
are prevented from accessing the global financial community. Bitcoin changes that in an instant, suddenly, it gives everybody
the capacity to act as their own bank, it gives them access to a currency that is
not restricted, doesn’t care who they are, doesn’t care where they live,
and can be accepted around the world. This is truly revolutionary because this brings these individuals
into play, all of a sudden. Think of the capacity that individuals,
that families, the communities have now, the potential to work themselves
out of the state of poverty. And you might say:
“Well, how is this going to happen? How will they adopt the technology?” 87% of the people in Africa have
a mobile phone at present, according to the Bill & Melinda Gates Foundation. Nearly 7 out of every 10 people in Kenya regularly use their mobile device
to send or receive money. And M-Pesa, which is a hugely successful
mobile money platform, in sub-Sahara in Africa,
has now included a bitcoin wallet. So let’s not pretend
this is not going to happen; whether is bitcoin or another
cryptocurrency behind it that’s secured by the same
mathematical certainty, this will happen because the advantages
are far too powerful for them to ignore, a faster, cheaper, more immediate,
instant transfer that can’t be challenged. So while you might say in this country
it’s little more than a diversion, and it’s just digital money, I would quote the entrepreneur
Andreas Antonopoulos who says: “Bitcoin is not money for the Internet,
bitcoin is the Internet of money” because bitcoin provides mankind with the ability to reach agreement
on a massive scale. It’s never been possible before and money
is just the first way that we can do this. I would say that there is
no other option in reality for so many other people around the world, and like the early days
of the Internet, sure, the technology may be a little bit
clunky now, not too user-friendly, but there the similarities cease,
this time it will be different, this time each of us has a mobile phone
in his pocket completing the network and enabling Bob and millions
of others all around the world to be able to do something significant
with this time and this money that will be saved. It is up to us as the passive
change accelerates to watch, to learn, and to take on board precisely what these
innovations are creating so that we can come together and we can
collectively help to shape the future over rules, over our communities,
and over our society, for the collective sake of us all. And that’s why bitcoins
are much more than money. Thank you. (Applause)

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About the Author: Maximilian Kuhn

29 Comments

  1. so "we" hop in, pay the car, the car buys it's own maintenance, probably from robots, why not … my humble question is: how can "we" pay the car if "we" can't be cabdrivers, car-mechanics … whatever it is "we" do to earn our living? Or is that "them", who'd be the unemployed then? Or will "I" be given bitcoins just like that?

  2. I'm absolutely thrilled by the potential for no trust transactions. The multi sig implementations from different wallet providers alone is a huge leap to trustless exchange. The no-party escrow ability of the blockchain and other features are equally remarkable techniques for revolutionizing trade. The reputation system of Ebay is powerful, but this is far superior. I am very excited to see what openBazaar and other sites come up with. 

  3. I am trying to find a negative comment with merit… Can do it… Hmmm. This looks good for bitcoin… Buy now while the price is low and the cost of mining is extremely high, general demand in low. Eventually the cost of mining will decrease as the transaction fees take over to offset the lower return from mining…. Bitcoin is nothing short of a major paradigm shift. DO NOT ignore this.

  4. Bitcoin: More Than Just Money | Dug Campbell | TEDxUniversityofEdinburgh
      http://onyalist.com/BITCOINGLOBALCLUB/googleonyalist

  5. Very calm and detailed presentation understandable for the masses. People seem to get so emotional about it and start shouting words without having a clue what they are really talking about.

  6. Oh hey! Have you ever tried – Brians Bitcoin Big Bang (do a Google search)? For anyone who is contemplating making money with Bitcoin, Ive heard some super things about it and my work buddy got cool results with it. 

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  10. Can we marry the idea of a coin for everyone and everything with the idea that natural wealth belongs to all? If we charge fees to industries that put pollution or take natural resources, all industries will have incentive to reduce environmental impacts. The industries that are profitable will be those that are sustainable. If we share the fee proceeds with all people, no one will live in abject poverty. Disparity of wealth will be less of a problem.

    We could have a sustainable and just civilization, if we share natural wealth equally.

    Natural law requires respect of PUBLIC property rights, too:
    http://gaiabrain.blogspot.com/2011/04/natural-law-requires-respect-of-public.html

  11. I think you may be overlooking a few important details. When using any electronic payment system or digital currency, there are always going to be 3rd party transaction fees. It doesn't matter whether you're using credit/debit, PayPal, skrill, qpay, perfect money, or even Bitcoin. Leaches or always going to be there to suck your blood. You'll never get rid of them. Bitcoin has them too. You've just managed to conveniently ignore them for the sake of your Ted talk. There are wallet fees, miner fees, and usually a 1% to 5% fee to buy Bitcoin with usd. Coinbase is 1% right now. Libertyx intinitially waved fees to get in the door. But now that they've arrived, they're 1% as well. And that's the pattern that is going to continue.
    The other thing I thought was flawed about his talk was security. It is true bank accounts can be hacked. But banks can at least protect you against fraudulent spending so you are not liable. Bitcoin that is stored on the hard drives of pc's and mobile phones can be stolen if those devices are infected with any number of malware or bots. And since Bitcoin is supposed to be at least pseudoannoynomous, there is no course to get stolen Bitcoin back.
    I'm a big fan of Bitcoin, but I think this guy is very misleading when he speaks about it. There are fees with Bitcoin that are difficult, if not impossible to get around. Also, as of right now, it is simply not that secure. So you have to be careful where you choose to store it.

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  15. bitcoin. just like the tech stocks in the 90s, just like real estate in the 2000's. nothing backing it except hope n faith it will be sold tomorrow to a bigger sucker for a higher price. physical gold and silver will emerge from obscurity and be proven to be the ultimate money! bitconners be like tech investors in 99, this time is different!

  16. How will the computers handle the vastly increased number of transactions if a lot more people in the world start using bitcoin?

  17. At the time of this speech was given, bitcoin was a few hundred dollars..now over $10000 dollars still going..maybe this guy is right.

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