What is your opinion on state-sponsored cryptocurrency? Or is it better in our country and economy to accept the duality of the fiat currency and all the cryptocurrencies?

[AUDIENCE] Hi Andreas. Thank you so much for the talk. It was a pleasure. I'm from Venezuela. Right now, we are living in a very special moment, trying to transition out of the dictatorship. I wonder, what is your opinion on state-sponsored cryptocurrency? A real one, not like the petro. Or is it better in our country and economy to [accept] the duality of the fiat currency and all the cryptocurrencies? [ANDREAS] That is a great question. State-sponsored cryptocurrencies don't change anything. By definition, will be centralized, controlled, surveilled, and closed. It will require identity verification and only be available to the select few. We will see more and more state-sponsored [digital] currencies because we are entering the last era of cash. Cash will be eradicated within our lifetimes. In many cases, our children will never see cash unless they visit a museum. It will be eradicated because (from the state's perspective) it creates an... unfortunate opening for freedom, in places where freedom isn't allowed. Cash allows some flexibility in the system when ridiculous things are made illegal. Generally speaking, [the people committing] the big crimes don't use cash. [It is hard to move]. For the big crimes, you need to buy yourself a banking license and use a bank to do it. [Applause] But if you want to sell bananas by the street-side without some license, or sell CDs with South Korean movies in North Korea, or contribute to the opposition political party, and these [activities are all] illegal, then cash is what you will use. Cash is going away. They will try to eradicate cash through state-sponsored digital currencies. They will try to create is a panopticon, a virtual digital prison of money, where everything you do is controlled... and monitored. At that point, your freedom is one binary switch [that they can flip]: free or not free. One day, someone will through that control room [and flip all of the switches]. Click, click, click! "I won the election!" [Laughter] Of course you did.

Do you see a place for cooperativism and networks of trust in the crypto space, next to trustless networks?

[AUDIENCE] Hi, thank you. It is so hard to keep it to just one question. In Argentina, we have a great history of cooperativism... that was destroyed by financial regulations protecting monopolies. My friend [used to run] one of those. Cooperatives for work or credit were networks of trust. They were small regional networks with a common language of value. I like to call them local-area networks (LANs) of value. But they couldn't scale or connect in a strong national network. I want to ask you, Do you see a place for cooperativism and networks of trust in the crypto space, next to trustless networks? [ANDREAS] Oh, absolutely. The trustless network exists for the edge cases. You need something to manage [situations where there isn't trust]. But [even while] the vast majority of human transactions happen on a basis of trust, you need trustlessness... in order to do those transactions where you have no idea who the other person is. But that [has not been] the vast majority of commerce. We have evolved into that space [as societies grew]. For example, the more you go into credit cards and digital money, the less you are able to interact with the local person. if you are a fisherman and just pulled some fish out of the sea, and you want to [sell] them to someone, you have two choices in the modern world. You either accept Visa or you will need to barter, right?

Cash is failing. People don't have cash or they don't want to use cash. It is difficult

Cash will not work in many places. Increasingly, cash is failing. People don't have cash or they don't want to use cash. It is difficult. I have been to Argentina four times now. I know that if a long weekend is coming up here, you start lining up at the bank on Tuesday because they fill the machines on Monday. If you are lucky, you can get some 500 peso notes. Otherwise, you will get stacks of 100 peso notes. Cash is difficult here. This is very difficult to explain to Americans who have never [experienced this]. I experienced that in Greece as well. I remember times when there weren't ATMs and people lined up at banks. We had runs on the banking, trying to pull out cash. Part of the reason you don't have [as many] cooperatives [anymore] is because... the local mechanisms of payment are failing.

'Trustless' doesn't mean we don't need trust, we don't use trust, or we don't want trust

Cryptocurrency brings that back. You don't necessarily need the trustless blockchain to accept a transaction... from someone you know, right? So how [would that relationship] express itself? Perhaps I will accept a zero-confirmation transaction. For some of the people I know in this room, I would accept a zero-confirmation transaction... of some significant value, because trust is more important there than the trustless network. It is the remote cases, [with strangers], where you can't do that. 'Trustless' doesn't mean we don't need trust, we don't use trust, or we don't want trust. It just means that we also have the possibility of operating without it. I really love the idea of local cooperatives, [particularly] in credit. I participate in some. They are mediated at the moment because they are still old-style, from before the says of Bitcoin. There are some in the United States where you can do micro-lending to other people. [Someone] will post a profile on the website saying, "I am a plumber and I need to equip my van with new ladders." "I need a loan for $250." Then they will receive loans of $25 from ten different people, which they pay back... over a period of six months and you earn interest. It is currently a market that [serves] all those [people] who can't get a bank loan. The good news is, we can do this more broadly and globally now. The bad news is, the mechanism of bank loans is failing all over the world anyway. Something must come in and replace it. Let's hope it is a more human approach. [Applause]