Introduction

[Applause] [ANDREAS] Oh my god, everyone came! Three months ago, I had a show in Seattle. It was a big theater with seven hundred seats and I was optimistic, because I have had big shows before. I thought, 'It is Seattle, [of course they will come].' Microsoft, Amazon, all these tech companies are there. But in eight weeks, we did not succeed in selling three hundred tickets. Because in Seattle, it is crypto-winter. [Laughter] Not just winter, crypto-winter. A lot of the people who became very excited in October 2017... for mysterious reasons, became very unexcited in March 2018 for equally mysterious reasons. [Laughter] But not here. Here, it is crypto-summer. We sold out in five days! Give a big round of applause. [Applause] To Rodolfo and more than twenty volunteers who came together to help me make this happen. Thank you so much to all of those who supported and worked really hard [to make] this event [possible]. Of course, to the sponsors as well. All of the work we do will go towards charity.

Crypto-winter and crypto-summer

This will be a fun place to start. Let's start with these concepts of crypto-winter and crypto-summer. How many seasonal variations of [the volatile cryptocurrency markets] have you been through so far? How many people have been through four bubble cycles? A couple of hands. Interestingly, the same people who did their inheritance planning! Three bubble cycles? Two bubble cycles? And newbies, one bubble cycle? Don't worry - there is another one coming! [Laughter] One of the interesting [aspects of] crypto [markets] is... Like any new technology, there are these waves of enthusiasm and speculation. Then people forget and move away. They come back [later with the next cycle]. Why? Because most of the people getting involved today don't actually need it. They only use crypto because it is something to speculate in. They are not interested in the potential of what [cryptocurrency] can do for their life today, but in the potential of its value increasing due to [how it affects] the life of somebody else, at some other time. But that [is not the attitude] in Argentina, South America, Southeast Asia, or South Africa. In those places, [the value of] cryptocurrency isn't about something that happens later. [It is not about], 'if my government suddenly became corrupt, if my bank started stealing our pensions...' 'If our speech was censored, our associations restricted, and our political parties imprisoned,' [Laughter] 'If, if, if.' But that is happening here. Americans have a hard time understanding this. They have the privilege and luxury of stability, but their [circumstances] are the exceptional life. The corrupt governments and banks are raiding their pension funds and imprisoning the opposition. There are cancelled elections and elections with a 96% [majority vote]. Those things happen all across the world. That is the [average] human experience.

The reason why crypto is so important

That is the reason why crypto is so important. [They are systems] that allow us to find new, 21st century ways of organizing societal institutions, instead of 19th century ways that have failed to scale. When we have this explosion of interest [in cryptocurrencies], [for those of you]... who are running a company in this space, you suddenly find yourself talking to people... who seem to be speaking a different language. They are very interested in the price and which shitcoin will be the 'next big thing.' They are very interested in understanding how they can '[fake it till they make it]' to be successful. When I am asked to talk to companies about cryptocurrencies and blockchains, and they tell me about their "wonderful new project," I ask them, "What is success [to you]?" "Let's say that you succeed. What does your company achieve? Describe 'success' to me." Inevitably, they fail [to answer that question]. In many cases, they haven't actually thought about what success will look like, other than, "We will make loads of money!" This is a very important question to ask: what does success look like [to you]? "We will build the best product that dominates the market and make us lots of money!" Who does that help? "Me." Okay, great. That is not enough people. Can we think about how we can help more people? Your current business plan is about helping four people. Can we [increase] the scale a bit? Can we think about helping more people? Then the market and this space is suddenly flooded by outsiders, opportunistic people who arrive because... they read an article in The Wall Street Journal or the magazine in the seat pocket of their flight, or because their colleagues are telling them: "This will be the next big thing since AI and quantum computing!" [Laughter] They come to this space and bring a set of assumptions with them. One of the assumptions is very interesting, and that is what I want to talk about today.

Markets operate as a zero-sum game

The assumption is that markets operate as a zero-sum game. They won't tell you this because [sometimes] they don't even know that is what they are thinking. It is a very important assumption. You must be very careful to notice it. When you have a business discussion, when you are talking to your friends... about the latest crypto [project] they are interested in, the implication under many of these conversations... is the concept of a zero-sum game. A zero-sum game is an environment in which one party wins only if the other party loses. [It is not] a situation where both parties win, or where everybody wins. You win at the expense of others. This is a toxic assumption that exists in every cycle of business. It is pretty much what [earning] an MBA (master's degree in business administration) is about, teaching you how to play the zero-sum games and crush your competition. It is not about making a better world, a better product, a better market, or increasing competition. It is about finding out what the rules are, figuring out how to exploit those rules, and building a fence around your intellectual property, your products, and your market niche. Learning how to prevent anyone from competing with you; learning how to capture customers- not acquire, "capture" customers, herd them into this fenced area, and extract as much money as you can. [Applause] Modern business in a nutshell. This assumption stems from some important considerations.

Free markets

The most important [factor] is the absence of free markets. In a free market, you don't play a zero-sum game and you can't stop competitors from entering. In a free market, if you create something new, others will emerge [to build on it] and also bring new customers, new opportunities, and market [niches] so that everyone can enjoy it and win. In free markets, it is not a zero-sum game. So then where is this idea coming from? It comes from the fact that most of the celebrated capitalists in the world have never seen... a free market in their entire life! [Applause] They operate in an environment where they come to own the regulators and write the rules. Their primary goal is to cheat enough to ensure that no one can stop them from acquiring... the holy grail of business: a monopoly.

The holy grail of business: a monopoly

Once you have a monopoly, you can [work to] prevent anyone from breaking into it, and extract as much value as you can from your customers. It is not about competition, improving markets or the world. It is about establishing monopolies. They bring that attitude into the crypto space and start spreading it like a poison in every business. [You see these] assumptions all around you. "We cannot open-source our wallet!" "If we open-source it, our competitors will copy it." "We need to find out who the regulators are. In fact, we should invite them to regulate our industry." "Then we will know what the rules are." What else do you need to know about the rules? The rules are pretty simple: one block every ten minutes and twenty-one million coins. [They seem like] pretty simple rules. [Laughter] We know what the rules are. They are enforced by network consensus. The smart contract will execute, the token will be issued [under these conditions]... The rules are clear. Why do you need different rules? "Oh, because we can't fix those rules [to benefit us]." "But we can fix the human rules with lobbying. We want to unleash our NDAs in the market." "We want to round up all possible customers and create a nice cozy monopoly, a zero-sum game. This is how you get the various forms of maximalism. "Our crypto cannot win unless their crypto loses!" So it becomes very important to point out all the ways the other crypto is not pure enough, how it is not the original vision of the founder, how it is not innovating in the correct direction. That is the zero-sum thinking infecting our industry. In an open-source industry like ours, it doesn't [hurt you] if [another cryptocurrency builds] something good. Copy it. It is open-source. Learn more about it. This is a beautiful environment where every invention... made anywhere in the entire ecosystem becomes one that everyone can use. [It is not just] the successes [that are valuable].

The open-source culture

Every failure is a lesson, a lesson someone else learned the hard way so that you don't need to. In business, that is even more valuable than a success, a failure that didn't cost you anything to learn it. This environment has a different set of rules. We are not suffering from a tragedy of the commons. We have a creative commons. The open-source culture is not just technological, only of our computer code. It is an open culture of creative people, which has all arrived at this singular moment in history and agreed... to one fundamental premise: this might be a better way. They are already on our side of the fence. The other side of the fence is a zero-sum game, with the corrupt governments, banks, and monopoly systems that create massive inequality, [economic]... failure, and wasted talent all around the world. That is on the other side of the fence. So if [your] friend has finally crossed over to this side, [on the basis] that there might be something better, there might be a new way of doing things, what will you do? [Will] you turn to them and say, "You bought what? That is a shitcoin, you heretic!" "What?" [You should say], "Welcome, my friend. Buy shitcoins if you want. You will learn soon enough..." [Laughter] "But I will advise you on something. Maybe, instead of buying, I can teach you about the technology." "You could learn about what you can do with it and how to apply it in your own life." "You will learn some skills [and be able to] use them in a business." "You can explore all the possibilities, and not just [treat this as] an investment." "Also, you probably shouldn't buy that shitcoin. Really, don't." [Laughter] "But welcome [to crypto]!" "But even if you did buy it, you have still made the very important mental leap... in figuring out that we are trying to build something different, something new." "You are already part of our Creative Commons." I will embrace that possibility. I will welcome everybody who comes in, for whatever reason, good or bad. It doesn't matter, as long as they are not bringing this zero-sum mentality, that we can only succeed if somebody else fails. We don't do that in open-source industries. We don't do that in free markets. We don't do that here. We have a creative commons that doesn't cause a tragedy of the commons, where everyone... exploits the resources, fences them off, and sucks them dry until there is nothing left. In a creative commons, everything is shared. If I consume from your knowledge, you will not lose that knowledge. You will have it and so will everybody else. If someone downloads my book without buying it, I didn't lose a book because they didn't buy it, but I have gained a reader who gave me... one of the most important things in life: attention. They had the ability to sit down and breathe for just a second, to push aside the noise and read something. If somebody reads my book, I am thankful [for their time]. Maybe they won't even make it past chapter one. That is okay. [Laughter] When I [met with] publishers and said, "I will publish my books under open-source [licenses]." "They will be free to read and to share. For the first year, no one will be allowed to commercialize them." "After the first year, they will be free to translate and re-sell by everyone in the world." "You can use it to make a musical performance if you want to." (You don't want to). [Laughter] Most of the publishers said, "What? How will we make money?" That is not what I am here for, dudes. That is not what this is about. How will we change the world? How will we bring something new, different, and creative into the world? If you do that, don't worry. People will appreciate it. They will find a way to reward you. If you are unlucky, they will give you money. If you are lucky, they will give you passion, creativity, and commitment. They will change their minds. They will go out and change the minds of other people. That [reward] is a hell of a lot more powerful. That is what we build hope on. When the market is booming, in come the zero-sum gamers. They say, "In order to really grow, we need investors. But investors have expectations." "Where is the intellectual property that we can [build a] fence around?" "Where is the product that will prevent competitors from entering the market?" "How do we win by crushing everybody else?" Some companies succumb to this message. Then the market turns and things become difficult. The zero-sum gamers become even louder. "The only way to win now is by giving up these stupid, naïve principles of yours, silly little anarchist." [Laughter] "We need to play the game with the big boys, the professionals, the regulators." "We need to do this [legitimately]." By 'legitimately,' they mean 'in a way that we can corrupt [over time].' Be very careful when you hear the word "professional." I can't even tell you how many times in my life... I have been in a business situation where somebody said, "Well, now we have a professional perspective." Well, welcome to our creative commons, which was built not by professionals, but by amateurs. Do you know what the root of the word "amateur" is? It is [from the French for] "lover of". An amateur is someone who does something out of love.

This space was built by people who love what they do, who pour their passion and creativity into their work.

This space was built by people who love what they do, who pour their passion and creativity [into their work]. Bitcoin and all the cryptos that follow were not built by paid professionals. They were not developed by a committee. They were built by naïve, idealistic weirdos... with creative tendencies who loved to do this, not because they wanted to make money, but because they wanted to bring hope. When the "professionals" come and say, "Let us take over and fix this," they will crush the creative spirit. They will extract everything they can from the carcass of your company, in return for restricted stock units... redeemable after a vesting cliff. They will sell your soul in order to have an exit. As soon as the market changes, they will ask... for you to sell out your principles.

Principles are your most important competitive differentiator a company or project in our space has. Do you know why?

Here is the part that most people don't understand: in this space, principles are your most important... competitive differentiator a company or project in our space has. Do you know why? Principles are the one thing they can't just copy; [they must actually embody those principles]. If your company or project operates based on principles of privacy, anonymity, censorship-resistance, and liberty, guess what? The corporate competitors in the banking environment out there can't do any of them. They are [often] legally prohibited from having principles. They are required to [kill] privacy as much as possible. They are required to do surveillance and violate the principles of the crypto creative commons. Hold on to those principles. They are your biggest competitive differentiators, marking the part of... the creative commons that they cannot invade, because those principles of toxic to their operation. If that is not enough to persuade you, just remember: when you give up your principles for a little bit of money, you have now entered the domain of the Facebooks, Googles, and Apples. They can give up principles so much faster than you! [Laughter] They have entire committees of MBAs... designed to give up principles at high profitability. They will sacrifice principles and [judge] their performance metrics by it. "How many principles did we sacrifice this month?" "Three hundred core principles are no longer present." "Not good enough! I want to see 6% growth in the sacrifice of principles month-on-month." They have the money and the ruthlessness. They do not give a shit about these messages. If you want to compete against them [in that area], they will throw principles at you so fast you will lose count. Hold on to those principles. They can't compete against that.

We are building a beautiful alternative for the world, a creative commons and a festival of innovation.

We are building a beautiful alternative for the world, a creative commons and a festival of innovation. Everything that anyone [creates] in this entire space enriches other projects. Every drawing or painting, every song and talk, every rebellious meeting in a dank basement... when nobody believes this is important. Every time you introduce someone else. Even [the failures of] every shitcoin. It all adds to this ecosystem we share. It is about building something that gives us hope. Our creative commons for the future. Thank you! [Applause]