How Do You Know You Can Trust Bitcoin?

00:02 Hey everyone, how do you know you can
00:04 trust Bitcoin and what exactly are you
00:07 trusting when you do trust Bitcoin?
00:09 Okay, so a helpful analogy is the
00:12 internet. Anytime you use the internet,
00:14 there’s actually a lot of trust there.
00:16 Especially if you uh process a financial
00:18 transaction on the internet, you’re
00:20 trusting all of the different parties in
00:22 the process not to cheat you, not to
00:24 scam you, to do what’s right. You’re
00:26 trusting the code that runs the
00:28 internet. You’re trusting that there’s
00:30 not any massive bugs in the internet.
00:32 You’re trusting all of those things. So,
00:34 it’s helpful when people when people
00:36 look at Bitcoin, they have a hard time
00:38 looking at it through the lens of other
00:40 things they already trust like the
00:42 internet or their smartphone or the apps
00:44 on their smartphone. Um, so let’s let’s
00:46 go through some of the building blocks
00:48 of internet of uh of the same building
00:50 blocks of the internet that apply to
00:52 Bitcoin. Okay. So, the first all uh
00:54 first off is the computer code that runs
00:56 Bitcoin. When you are using Bitcoin, you
00:58 are trusting the code that runs Bitcoin
01:01 the same way you uh are trusting the
01:03 code when you use the internet. And as
01:06 with the internet, there are computer
01:07 programmers that write that code. The
01:09 big difference with the uh with Bitcoin,
01:12 unlike the internet as a whole, is that
01:14 Bitcoin is open source. Meaning the
01:17 entire code of the entire Bitcoin
01:19 network is open for the world to see for
01:21 literally anyone on the entire world to
01:24 audit the code of the Bitcoin network
01:26 and to audit every transaction of the
01:28 Bitcoin network. They can’t tell who
01:30 sent money to who, but absolutely all of
01:32 the code that runs it is open sourced,
01:35 which means anyone can audit it. And it
01:37 is the most scrutinized code in the
01:41 entire world. So the uh the code that
01:43 runs on your bank’s servers or on
01:46 Amazon, you know, maybe a dozen
01:48 programmers uh reviewed the code that
01:51 processes your bank payments or
01:53 something like that or even fewer,
01:54 maybe, you know, a handful of people
01:56 really scrutinized the code for your
01:58 financial institution. In the case of
01:60 Bitcoin, millions of people are looking
02:02 at that code, every single line of code
02:05 trying to predict what could go wrong,
02:07 you know, all of that. So with Bitcoin,
02:09 you are trusting the code of Bitcoin,
02:11 but it’s open source. It’s viewable by
02:14 anyone. And if you are not a computer
02:16 programmer, I presume almost none of the
02:17 people watching this video are computer
02:19 programmers. Uh you can get somebody to
02:21 go review the code of the uh of the
02:23 Bitcoin network. And a lot of the early
02:25 investors in Bitcoin did that. uh Wes
02:27 Casaceras and a lot of the others hired
02:30 armies of the very best computer
02:33 software developers they knew and said
02:35 please break this code because I’m about
02:37 to put a bunch of money in it and if it
02:39 can be broken I want to know and every
02:41 time the the programmers came back and
02:43 said this is amazing like this code is
02:46 really really really good. Um so Bitcoin
02:48 is the most trustworthy code that runs
02:51 in the world and you are already
02:53 trusting code every time that you use
02:55 anything in your life regardless. So
02:58 Bitcoin is the more trustworthy of the
02:60 code. Now as with the internet in the
03:02 very early days of the internet some
03:03 people said well I don’t trust the
03:05 internet because what if there’s a bug?
03:07 What if there’s a bug in the internet
03:08 code? Well right now if somebody told
03:10 you that if they said well I don’t feel
03:12 comfortable with the internet because
03:13 what if there’s a bug in it? Your
03:15 response would be probably to look at
03:17 them funny. You’d think, “Wait, a bug in
03:20 the internet?” Like the internet’s this
03:23 like ba massive network. It’s not
03:25 there’s not like a bug in the internet.
03:27 And secondly, do you think they wouldn’t
03:29 fix it? Like the the whole point of the
03:31 internet is what’s the probability that
03:33 there someone’s going to discover a bug
03:36 in some of the code that runs the
03:37 internet and it’s going to take the
03:39 internet down forever and the internet
03:41 will just never be a thing anymore. The
03:43 probability of that is zero. literally
03:45 zero. If there is a bug in something
03:47 related to the internet, the computer
03:49 programmers that manage the software of
03:51 the internet will fix the bug and get
03:53 the internet running as soon as
03:55 conceivably possible. It’s the same with
03:57 Bitcoin. If there was some bug in the
03:58 code of Bitcoin, the same very diligent
04:01 programmers that are programming Bitcoin
04:03 would fix that bug as fast as
04:05 conceivably possible. So with Bitcoin,
04:07 you are trusting computer code, but it
04:10 is more audited and more secured and
04:12 open- source computer code and more
04:14 audited and more secured than any other
04:16 computer code that you trust anything
04:18 with in your life. Okay. Second, you’re
04:21 trusting computer programmers, but
04:22 again, it’s open source code and you
04:24 trust computer programmers with
04:26 everything else you do in your life as
04:28 well that’s connected to anything with
04:30 regard to computer code. And that
04:31 includes everything from your oven and
04:34 you know all the electronic controls on
04:36 your washing machine, your dryer, your
04:37 refrigerator. Like all of that’s got
04:39 computer code behind it. All right.
04:41 Well, with Bitcoin, you’re also trusting
04:43 the incentives of the system. You’re
04:45 trusting the people of the network not
04:48 to all of a sudden decide that we’re all
04:50 going to use Bitcoin that has 22 million
04:53 coins instead of 21 million coins. Well,
04:56 the way Bitcoin works is Bitcoin is a
04:59 consensus of 100% of the participants,
05:02 which means if even a single person in
05:05 the entire Bitcoin network disagrees
05:07 with a change to the Bitcoin network,
05:09 then the the the change the protocol and
05:12 the change will break off into its own
05:15 network. So in the case of Bitcoin, if
05:17 somebody came along, one second,
05:21 if somebody came along and said, I think
05:23 there should be 42 million Bitcoin
05:25 instead of 21 million Bitcoin, then the
05:28 the only people that would follow that
05:31 network would be people who wanted there
05:33 to be twice as many Bitcoin, which makes
05:35 no sense because it would dilute the
05:37 number of Bitcoin everybody has. it
05:38 would make the entire uh all of the
05:41 Bitcoin that already exists would become
05:42 half as valuable if suddenly there was
05:45 twice as much Bitcoin and they got you
05:47 know distributed to who knows who. So
05:50 virtually none if not zero of the
05:53 current hundreds of millions of people
05:55 that own Bitcoin are going to agree to
05:58 change the total number of Bitcoin. And
06:00 if even one person disagrees then the
06:04 current version of Bitcoin keeps going
06:06 like it is. There might be another
06:08 version of Bitcoin that has 42 million
06:10 coins. Um, but uh that’s already
06:12 happened 20,000 times. Uh, already
06:15 20,000 cryptocurrencies have tried to do
06:18 something like Bitcoin and change
06:20 something about it, including a bunch of
06:22 them who said, “Let’s make 42 million
06:24 coins.” And everybody was like, “Nope,
06:26 we’ll just own the Bitcoin that has 21
06:28 million coins.” So, um, so you’re you’re
06:31 trusting the consensus and the
06:33 incentives of humans, but anything that
06:36 would change the Bitcoin network that
06:38 would hurt you would hurt everyone else
06:40 on the Bitcoin network, such as diluting
06:43 the currency somehow or making more than
06:45 21 million. So, with Bitcoin, you’re
06:46 trusting the code just like you do with
06:48 everything else in your life. You’re
06:50 trusting the computer programmers behind
06:51 it. But again, in this case, with
06:53 Bitcoin, you don’t even have to trust
06:54 the programmers because the the code is
06:57 open source. you can just audit it and
06:58 look at it yourself. Um, and the
07:00 computer programmers behind Bitcoin are,
07:02 I would argue, better computer
07:04 programmers than are behind virtually
07:06 anything else in the world. Like, I
07:07 mean, it’s just incredibly incredibly
07:10 talented people that are very passionate
07:13 about Bitcoin and there is a huge
07:15 massive army of them. Um, and then
07:17 you’re trusting the incentives. You’re
07:18 entrusting people not to decide to
07:22 dilute and devalue their own money. And
07:24 again, if even one person disagrees, you
07:26 can’t change the network unless you have
07:28 100% total consensus. Otherwise, it
07:31 forces everybody who wants to change the
07:33 network onto their own version. Uh, and
07:36 that actually happened with something
07:37 called Bitcoin Cash. There was a group
07:40 of people including Roger Ver who was on
07:42 a Tucker Carlson interview recently
07:44 who’s he’s become a bit of a pariah in
07:46 the Bitcoin community. He backed a
07:49 change to Bitcoin that the majority of
07:52 Bitcoiners did not agree with. It was
07:54 not a change in the amount of Bitcoin.
07:56 He still wanted there to be 21 million,
07:58 but it was uh it was a change in how
08:00 easy it is to secure and audit the
08:03 Bitcoin network, specifically audit the
08:05 Bitcoin network. And for a variety of
08:07 reasons I won’t go into, uh there was a
08:09 massive fight about that back in 2017.
08:11 And ultimately all of the people that
08:13 agreed with Roger Ver uh decided to
08:16 launch their own network and that that
08:19 network which is called BCH instead of
08:22 BTC which is the real Bitcoin. Bitcoin
08:24 Cash is called BCH uh sometimes called
08:27 Bcash. Um and it’s trading at 1200th of
08:32 the price of Bitcoin. So that token
08:35 which attempted to change something
08:37 about Bitcoin that not everyone agreed
08:39 with that token since its launch has
08:42 lost 99.5%
08:45 of its value. Literally
08:48 1992 2000s of its value have disappeared
08:51 because it was not a cons there was not
08:54 a consensus that that change should
08:56 happen to Bitcoin. So that is just the
08:59 the probability that something bad
09:00 happens to Bitcoin. the owners of
09:02 Bitcoin are absolutely positively not
09:05 going to agree to change something about
09:07 Bitcoin that changes, you know, the
09:10 value of Bitcoin to them, which means
09:12 there will never be more than 21 million
09:14 Bitcoin because you’re never going to
09:16 get 100% of the Bitcoin owners to agree
09:19 to devalue their currency. So, um, and
09:22 again, also as it relates to everything
09:24 else you trust in life, it’s the same
09:25 way. Um, in with your fiat currencies,
09:29 you’re trusting your banks. um much more
09:32 so than you are trusting Bitcoin and
09:34 you’re trusting a very small number of
09:35 people at the Federal Reserve to decide
09:37 how much money there is in the world.
09:39 And so instead of trusting everyone that
09:42 owns a US dollar not to debase the value
09:44 of the US dollar with US dollars, you’re
09:47 trusting basically 12 people to decide
09:50 what your money’s worth, which are the
09:52 uh the various uh you know Federal
09:54 Reserve the uh representatives of the
09:56 Federal Reserve, including especially
09:57 the chairman of the Federal Reserve. So,
10:00 uh, the current financial system
10:02 requires way more trust in way shakier
10:06 and untrustworthy things than Bitcoin.
10:09 Bitcoin really doesn’t require any
10:11 trust. But if you want to say it does,
10:13 it’s trust. It’s trust in things you
10:15 already trust with all sorts of things
10:17 in your life like computer code and the
10:20 developers, the software developers
10:22 behind computer code and the incentives
10:24 that make sure that Amazon doesn’t cheat
10:26 you. Um, you know, any company could
10:29 cheat you out of money somehow uh by
10:32 taking your credit card information and
10:34 not shipping a product and they don’t
10:35 because they have an incentive not to.
10:37 And in the case of Bitcoin, hundreds of
10:39 millions of people have an incentive not
10:42 to change the rules. And that is the
10:44 case with all money. In the case of all
10:46 money, it’s based on the consensus of
10:48 how money works and who’s behind it. Um,
10:51 and that’s just that that will always be
10:53 the case. So uh so to summarize with
10:56 Bitcoin, why can you trust Bitcoin? It
10:59 is more trustworthy than anything else
11:00 in the world. Um the the software is
11:03 more solid, the developers behind it are
11:05 more solid, the network is more
11:06 resilient than the entire internet. And
11:08 if you trust the internet with anything
11:11 in your life, Bitcoin is far more
11:14 trustworthy than the internet as a
11:15 whole. So, if you think it’s okay to use
11:18 the internet and if you trust the
11:20 internet to carry your credit card
11:22 number over the wires or if you trust
11:24 the internet with private or personal
11:26 information or if you trust your
11:28 smartphone to have private or personal
11:30 information or your credit card numbers
11:32 or debit card numbers on it, uh that
11:35 level of trust to trust those things is
11:38 much more uh at risk than the trust you
11:42 put by investing in Bitcoin. uh the
11:44 cryptography, the math. With Bitcoin,
11:46 you’re trusting cryptography just like
11:48 you are with your traditional banks.
11:50 You’re trusting mathematics just like
11:52 you are with your traditional banks.
11:53 Except in all of those things, uh
11:55 Bitcoin is much more secure than your
11:57 bank. It is the cryptography that is
11:59 used to secure it is more secure than
12:01 whatever your bank is already using. And
12:03 so I look at it, some people say, I just
12:05 don’t know if I can trust Bitcoin. My
12:07 answer is if you don’t think you could
12:09 trust Bitcoin, how do you trust
12:10 anything? because Bitcoin is the most
12:12 trustworthy and absolute thing that
12:14 exists in the entire world. And uh last
12:17 thing I’ll say, if you don’t trust the
12:19 code and you don’t trust the developers
12:20 and you don’t trust the incentives, then
12:24 maybe you trust the fact that Black
12:25 Rockck and Fidelity and Franklin
12:27 Templeton and almost all of the largest
12:31 firms on uh on Wall Street are actively
12:34 marketing Bitcoin to their clients in
12:37 the form of Bitcoin ETFs, which are just
12:39 a an exchange traded fund is a wrapper
12:41 that goes around Bitcoin, but inside it,
12:43 the only thing in there is Bitcoin. and
12:46 um they are actively marketing. So if
12:48 you think well how do I know I can trust
12:50 this? The answer is do you trust the
12:52 largest Black Rockck manages $12
12:54 trillion of assets? They’re the largest
12:57 money manager in the world. And they
12:59 came out yesterday $12 trillion Black
13:02 Rockck largest money manager in the
13:04 world and said you know everybody who
13:07 has a standardized portfolio ought to be
13:09 able to put at least 1 to 2% of that in
13:11 Bitcoin. Now they say Black Black Rockck
13:14 has also said the optimum number is 85%.
13:17 But they’re saying look everybody it
13:19 it’s reasonable to put a couple percent
13:22 at least of your portfolio in in
13:24 Bitcoin. Um and they run the largest
13:26 Bitcoin ETF. BlackRock does. They’re the
13:28 largest uh firm on uh for asset manager
13:31 on Wall Street and they have the largest
13:32 Bitcoin ETF. So even even if you don’t
13:35 are not sure you can trust everything
13:37 else, do you trust all of the financial
13:40 organizations that are actively selling
13:42 this? I promise you, Black Rockck
13:44 Fidelity, two of the largest financial
13:46 managers in the world, they did not go
13:48 start marketing Bitcoin to all of their
13:50 clients without doing their due
13:51 diligence. They did the work. They got
13:54 their software developers, their
13:56 hackers, they got all of those people to
13:58 go pound on Bitcoin to make sure it was
14:00 solid before they started marketing it
14:02 to their clients. And they, Black Rockck
14:04 would never never jeopardize their
14:08 reputation as a $12 trillion asset
14:11 manager to put their clients in
14:14 something, you know, risky or unsolid.
14:16 Um, they would never do that. It makes
14:18 no sense to risk 12 trillion just to put
14:23 50 billion 20th of one of those
14:26 trillion. I mean, it makes no sense to
14:28 put a, you know, to to risk those
14:31 clients on something that might blow up,
14:33 which tells you it’s not going to blow
14:34 up. You know, Bitcoin is not going to
14:36 blow up. the largest asset managers in
14:38 the world and the many of the largest
14:40 investors in the world are actively
14:42 investing in Bitcoin because it’s rock
14:45 solid and they have done the due
14:47 diligence and they have done the work.
14:48 So even if you don’t have time to do the
14:51 due diligence and to do the work, look
14:53 at the world and say, “Hey, you didn’t
14:55 audit the code that runs the internet
14:57 and you still use the internet. You
14:59 didn’t audit the code that runs your
15:00 smartphone. You still use your
15:01 smartphone. You still transact on
15:03 Amazon. You still buy stuff online. you
15:05 still have your credit cards, you know,
15:08 you know, your credit cards. Every time
15:09 you swipe a credit card at a retailer,
15:12 um, you know, any sort of store, your
15:14 credit card number immediately hits the
15:16 internet. Even if you don’t enter it on
15:18 the internet, that credit card number
15:20 immediately hits the internet every time
15:21 you use it at any store anywhere in the
15:24 world. It immediately hits the internet
15:26 uh to go get processed by Visa or
15:27 Mastercard or whatever. So, um, even if
15:30 you haven’t personally, uh, audited all
15:32 those things, you trust Visa and
15:34 Mastercard not to mess you up. And it’s
15:37 the same thing here. You trust Black
15:39 Rockck and Fidelity and all of the
15:40 largest money managers and some of the
15:43 most successful many of the most
15:45 successful investors in the world who
15:47 have done the research, who have done
15:49 the work, who have audited the code, who
15:52 have uh played out every single
15:54 conceivable scenario where something bad
15:56 could happen to Bitcoin and they decide
15:58 as a result of that we are going to re
16:00 recommend this to our clients. even
16:02 though it represents a tiny percent of
16:04 the assets uh that they manage, the
16:06 total reputational damage if something
16:09 bad happened to Bitcoin would be huge
16:11 and they’re willing to take that risk
16:13 because they have evaluated as
16:15 essentially zero risk. They have they
16:17 have looked at it and said the
16:18 probability that something bad happens
16:19 to Bitcoin is effectively zero. And
16:22 because it’s effectively zero, we can
16:24 confidently market this product to our
16:27 clients and customers just like we do
16:29 Tesla and Amazon and Apple and Google
16:32 and Facebook and uh all of those other
16:35 things. So, um anyway, uh Bitcoin is
16:38 just about the most trustworthy thing in
16:40 the entire world. And you don’t have to
16:42 take my word for it. Go search the
16:44 internet. Go find go do your own
16:47 research and you’ll find that all of the
16:49 smartest people have come to the same
16:51 conclusion of the rock solid nature of
16:55 Bitcoin. And um and and then and the
16:58 most beautiful part about Bitcoin is you
17:00 don’t have to trust anybody. You’re
17:02 there’s no single entity that can mess
17:04 you up or change the money supply. It’s
17:07 decentralized which means there’s
17:09 there’s nobody that can make the
17:11 decisions to derail everything. There’s
17:13 a million people that can fix something
17:15 if no if something goes wrong, but
17:17 there’s nobody that can single-handedly
17:19 mess it up or even a small group of
17:21 people that can single-handedly mess it
17:23 up because everybody’s watching the
17:24 Bitcoin code and nobody upgrades to the
17:27 the next version of the Bitcoin code. Uh
17:30 unless, you know, a million people have
17:32 reviewed the code and everybody’s
17:33 decided it’s rock solid. Um so, uh
17:36 Bitcoin is just about the most certain
17:37 thing in the entire world. And that
17:39 stability is built on uh just an
17:42 incredible and an inordinate amount of
17:44 time and labor and reputation that
17:47 everyone has staked in it to make sure
17:49 Bitcoin is just the most rock solid
17:51 thing in the world. So um as far as
17:54 trust goes, I would put Bitcoin at 100
17:56 out of 100. And uh basically everything
17:60 else in the world I trust less than
18:02 Bitcoin. If you if you put an index of
18:05 all the things I trust in the world, you
18:07 know, I would say, you know, the love of
18:09 my family, God, and you know, the uh
18:13 credibility of Bitcoin’s monetary
18:15 properties, you know, all of those are
18:17 in the uh you know, 100point index on a
18:20 100point scale. Virtually everything in
18:22 your life that you use or that you trust
18:25 is less trustworthy than Bitcoin. Have a
18:28 great night, everyone.