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tv   Washington Journal Peter Van Valkenburgh  CSPAN  May 28, 2021 12:53pm-1:11pm EDT

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senator blackburn, blood, burr, enough, shelby did not vote. senators agreed today to delay action on a bill that supports you with science and technology efforts to compete with china. that bill expected to be considered after lawmakers return from the memorial day break it senate lawmakers to be approved a couple of biden administration nominees. live coverage of the senate when the gavel back in on c-span2. shortly we take you live to remarks of senator majority leader chuck schumer. we will have that live in a couple of minutes here on c-span2. >> c-span is your unfiltered view of government. we are funded by these television companies and more including comcast. >> comcast is partnering with 1000 with 1000 temerity senators to great
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wi-fi enabled lift center systems from low income families can get the tools they need to be ready for anything. >> comcast support c-span as a public service along with these other television providers giving a front row seat to democracy. >> the think tank is called coin center and joining us in washington is the research director, the website is coin center.org and we'll talk about your organization a let's begin by talking about crypto currency, bitcoin. what are they? >> so bitcoin is the original crypto currency, the first one ever launched back in 2009. there's a whole bunch of them now. in general these can be thought of as digital cash. when you want to move money around do you have two options. you can use cash and be in person, and some with a $100 bill or take it from somebody, hopefully legally, or you can use bank to send money
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electronically from person to person over the internet over the telephone. bitcoin is cash like in that you can hold it, you can have directly. you don't have to trust the bank told for you but it works electronically. i could send it to some in singapore and devotion a coat on their phone over the internet and i will send it to that code and the bitcoin moves peer-to-peer like cash. >> we are talking this morning our producer about email, 20 years ago or 25 years ago that was a novel idea. now of course w is a standard wy of life. timely and vision bitcoin will be standard in a way we make any transaction? >> i think we are already getting there. e-mails the per for comparison. in the '90s very few people used email and it seemed like aa weird new thing, why not send a letter. e-mail was this great open standard called the simple mail transfer protocol and is made by bunch of smart folks who have sort of strange ideas in silicon
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valley and then the rest of the world and developed just for the benefit of people, anyone can sendon email to receive an emai. you can send a person-to-person, poster e-mail server or a company like google. suddenly they gott easier and faster and better and we fixed the spam problem and now everyone does everything with e-mail, or with text messages or more modern versions of internet communications. very few people send letters no. with bitcoin and other cryptocurrencies and mencr of te bitcoin, it may be as stable coin. we can talk about these later, with other cryptocurrencies and bitcoin were going to see people doing more and more transactions that were previously done in person or using a trusted third party like a bank done peer-to-peer over the internet just like e-mail. but we'll see. >> host: this from friday morning, we saw bitcoin prices surge in terms of the stock pick it's not taking a slump. can you explain?
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>> guest: this is something that anybody was thinking about buying some should take into account. the fact of the matter is because bitcoin is this protocol there is no company or corporation or government backing the currency. there's just a a fixed number of bitcoins that exist on the peer-to-peer networks ledger called the blockchain. the blocking is a description of all the transactions that have ever happen so if you're skeptical as to whether someone has actually sent you bitcoin you can look at the blockchain using software on your computer that makes it easier to see the transaction happened. you can look at the blockchain using software on a computer on the smartphone to see the total number of bitcoins thatt exist. there's onlyn so many bitcoins can only ever going to be 21 million bitcoins. it is scarce digital commodity just like gold is a scarce physical commodity. that means if supply is fixed and demand shifts because suddenly a a bunch of people t to buy or a bunch of people don't want a bite, then you'll
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see an adjustment of the price. we can't move supplies of demand shifts rapidly according to the lots of wind event in economics price was shift rapidly go all the way up to say a high that we are at recently of around 40, $50,000 a bitcoin or he could go back down and like is that it's gone back down recently. you shouldn'tck treat this as a investment if you should treat this as a speculative investment if you're thinking of buying bitcoin. there are other cryptocurrencies, some of them have a fixed supply and, therefore, the price goes up and down with a lot of volatility but there are also new technologies called stable coins which maintain parity with the u.s. dollar. if you want to use this pure tube and network to send money and don't want to worry about price changes you could use a stable coin,ha something like de or usdc tremont as you point out on your website at coin center.org the case force electronic cash and some of the numbers you put in this and on your website include the
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following with bitcoin being among the largest cryptocurrencies but there are now more than 10,000, the first bitcoin dates back to 2009 and you point out in the u.s. 46 million using a form of crypto currency that is about 17% of the population. that number is surprising, that seems like a higher number than one might suspect trickier i think that surprised me as well. it was recent research from "newsweek." that said there's a lot of young people now who are skeptical about traditional economic systems. they have may be seen one or two recessions if you're like me and you enter the job market back in 2008 and then you are now facing the economic fallout from covid and you think maybe we can find a better way. a lot of folks young and old are thinking maybe there's a different way ofa organizing the economy and maybe we don't have to trust the big banks to do it. maybe he can a peer-to-peer online system and that could be bitcoin or it could be a lot of these new cryptocurrencies.
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>> host: how does thaten differ from apple cash or when you go to a store or a merchant and use your credit card? >> guest: you know, better and worse. there's differences. it's better because when you use apple pay, for example, you have to have apple on your side. .. and apple reserves the right to systematically shutdown apple pay whenever they want and anyone all from that system and you will no longer
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be able to transact. and i don't mean to pick on apple, they make a good phone but this is true of any electronic payment method. banks work that way. you are at the whim of a major corporation and their choice as to whether or not you are allowed to continue to make payments so we can imagine lots of issues with totalitarian governments. lots of issues with discrimination so i wouldn't want to rely only on a corporation to allow for payments so that's where the difference comes in because there's together and we don't trust the one of to process the payments. if one of them don't want to process that payment can be by the next first. there's thousands of people who run these networks collaboratively on the internet so censorship free is for your class how does
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venmo injuries? these are. your vehicle to make all you want using venmo but if you are organizing pro-democracy protests in belarus, you will get off venmo. is our duty and fired from their jobs for money using the complicated software and
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what you might be used to but maybe it's worth it because it's definitely worth it for pro-democracy advocates in belarus >> was going to happen to currency and coins ? >> i think there's folks in the bitcoin community who make too many noises about how bitcoin is going to dominate all economic systems and people won't be using dollars anymore and nobody will be using banks anymore and that's a little foolhardy . there's going to be times when bitcoin transaction is what you want if you're in an oppressive state like nigeria or belarus you might find it easier to use bitcoin. in the us we have a stable banking system. we have a well-functioning government although sometimes i disagree but generally speaking we've got a good situation here from a financial infrastructure standpoint so generally
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speaking in the us you will probably use credit cards on venmo but maybe you want to bind it going because it would be a way to balance your investment portfolio because again, it doesn't get increased by the federal reserve or something like that. as part of a balanced portfolio that includes other paper investments you might have a little bit of that coin. >> peter is with coin center, this is a website. tell us about your organization and how you are funded. >> calling center has been around for six years. we are an independent nonprofit and we probably have lots of great associations talking about the interest of an industry but like i said, that coin isn't an industry. there's a big corporations like coin base and it will run profitable businesses on top of thebitcoins network .
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but the bitcoins network itself is not a corporation. it's not a group of companies even. it's just a group of trained strangers on the internet collaborating for an economic system and because it's a shared public resource, there's no ceo who can testify before congress and we saw this six years ago when we were starting coin center. we said we want to be an independent source that has good information about the technology for folks who have questions because people in government have a lot of questions about things like bitcoin so we operate on a donation based system. educating folks in the executive branch were in congress about how bitcoins works they are free to support us for the coming year. and we've had generous donations from people who like this technology and want to see an lawyer type people
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repping it to folks and we've been doing that for six years. it's the best job i could ask for as a young law graduate six years ago. >> ned is joining us from idaho and you own crypto currency. >> i do not. there is nothing big to it. i'm not sold on it. there's also a problem with the amount of power being consumed. by bitcoin. it is more than the entire country of argentina. is consumed by the coin. a little bit of a problem. we're trying to do this whole rule thing. you've got to slow down and you're creating new technology . and now we know coming up
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soon, they're already out of the deep tank units. >> if you do on the number to call is 202-748-8000 two. but to his point and then this tweet to jody who says i refuse to be chained to a platform that can be hacked with ease to manage my money bitcoin is like the stock market, only a few will make it big and a bunch of people willlose their shirt . i like to touch my money, i will not by bitcoin. too bad and to jody whatwould you say ? >> let's talk about the energy use question because that is a good rest in. the first thing i want to say is we need to know why bitcoins uses this amount of energy. to get into this we needto have a little detail as to how it works . let's get straightforward and public technical speech so if you've got all these people collaborating to keep this system working, to keep a block chain which is that
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record of all transactions we have this question. if were not trusting a company like paypal or bank of america to keep our records how do we incentivize people to keep that record and how do we make sure people who are keeping that record are really invested in the systems themselves so that they're not going to create fraud . make transactions themselves. we do it in a consensus mechanism is the technical term, a way of getting everyone based on certain roles ofcomputation . the bitcoin consensus is what we call approval for consensus mechanism which means if you want to participate in this chair of maintaining the ledger of transaction, you want to build a free and open transaction tools, you need to prove to us that you spent some amount of energy in costly computation so you're solving like a difficult math problem that could only be solved by making a lot of effort using powerful computers to make more and
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more guesses but if you provide proof of that additional work, then you welcoming in. you don't need to get permission. you don't need to buy a special computing software. you just use pumping commonly available and you prove that you spent the energy and spent the computing power to participate and this is our key people were not serious out of the systembecause god knows lots of people are not serious and if anyone is allowed to keep the ledger we have problems . your caller said that coin uses about the amount of energy used by argentina. that's pretty close and that seems like a lot but there's a lot of money at stake with the ledger at this point and the question is how much resources would be willing to dedicate tomaintaining this much money this many balances for individual people all over the world . the global financial system that is all of the great banks, all the computer systems and all the laws that
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backup those things, that uses a whole bunch more energy and i think we could actually be more tame more attention if we transitioned to more of a system, there'd still be a lot of energy use but it's something worth spending energy on kind of like it's worth bending energy on food production or computers on your macbook pro with the aluminum body. aluminum is a whole bunch more energy and that coin for example. and the last thing i want to say is this is a serious problem.it's minor. the people on the bitcoins network or expending energy are using dirty energy sources like coal. one thing you will find out if you look into this question deeply is that yes, there are a fair number of minors in china and those minors located in china, china pays people today call out of the ground and burn it forsuper cheap electricity . it wouldn't be that she if the chinese government wasn't paying people to dig coal out of the ground and burn it for electricity t

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