How Much Privacy is Necessary: Cash vs Crypto

Space Summary

The Twitter Space How Much Privacy is Necessary: Cash vs Crypto hosted by QuaiNetwork. Exploring the balance between privacy in traditional cash transactions and cryptocurrency, this Twitter space delved into the nuances of decentralized energy dollars on a scalable Proof-of-Work blockchain. Discussions highlighted the privacy considerations unique to each financial system and the importance of blockchain scalability for programmability. Evolutionary trends, contrasting privacy dynamics, and the impact of decentralized currencies on privacy perceptions were key focus points, showcasing how debates on privacy shape financial autonomy and innovation in the ever-evolving crypto landscape.

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Space Statistics

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Questions

Q: What makes decentralized energy dollars unique in the blockchain space?
A: Decentralized energy dollars introduce new utility and sustainability facets to blockchain applications.

Q: How do privacy considerations differ between cash and cryptocurrency transactions?
A: Cash transactions offer inherent anonymity, while crypto transactions are pseudonymous, requiring additional privacy measures.

Q: Why is blockchain scalability vital for programmable technologies?
A: Scalability ensures that blockchain systems can handle a large number of transactions efficiently, crucial for programmable features.

Q: What evolutionary trends are driving the ongoing crypto revolution?
A: Interconnectivity, decentralization, and user empowerment are key trends shaping the crypto landscape.

Q: In what ways do decentralized currencies challenge traditional privacy norms?
A: Decentralized currencies introduce transparency and traceability, potentially reshaping privacy expectations.

Q: How do programmable blockchains extend beyond financial applications?
A: Programmable blockchains enable smart contracts, tokenization, and decentralized applications, revolutionizing various industries.

Q: Why do debates on privacy play a critical role in the discussion of financial autonomy?
A: Privacy concerns influence trust, security, and individual control over financial assets, pivotal for achieving true financial autonomy.

Q: How important is it to grasp privacy nuances for innovating in financial technologies?
A: Understanding privacy complexities is essential for designing secure, user-centric financial solutions that drive innovation.

Q: What impact do decentralized currencies have on privacy perceptions and adoption rates?
A: Decentralized currencies can alter views on privacy by offering transparent yet secure financial ecosystems, influencing adoption dynamics.

Q: What are the implications of shifting privacy paradigms in a decentralized financial landscape?
A: Shifting privacy paradigms can redefine data ownership, trust models, and regulatory approaches in decentralized finance, impacting user interactions.

Highlights

Time: 00:15:42
Decentralized Energy Dollars on Programmable Blockchains Exploring the concept of decentralized energy dollars and their impact on blockchain innovation.

Time: 00:25:19
Cash vs Cryptocurrency Privacy Dynamics Contrasting privacy elements between traditional cash transactions and cryptographic financial systems.

Time: 00:35:57
Scalability's Role in Blockchain Programmability Understanding how scalability influences the effectiveness of programmable features in blockchain technologies.

Time: 00:45:30
Evolutionary Trends in the Crypto Revolution Analyzing the evolutionary factors steering the ongoing transformation in the crypto space.

Time: 00:55:10
Decentralized Currencies and Privacy Paradigms Discussing how decentralized currencies challenge conventional privacy norms in financial transactions.

Time: 01:05:48
Programmable Blockchains Beyond Finance Exploring the diverse applications of programmable blockchains in revolutionizing various sectors.

Time: 01:15:25
Importance of Privacy Debates for Financial Autonomy Highlighting the significance of privacy discussions in achieving true financial independence and security.

Time: 01:25:03
Grasping Privacy Nuances for Financial Innovation Emphasizing the need to understand privacy intricacies for driving innovative financial solutions.

Time: 01:35:42
Decentralized Currencies' Impact on Privacy Perceptions Examining how decentralized currencies influence perceptions and adoption rates through privacy-focused ecosystems.

Time: 01:45:18
Shifting Privacy Paradigms in Decentralized Finance Exploring the implications of changing privacy concepts on user interactions and regulatory frameworks in decentralized finance.

Key Takeaways

• Decentralized energy dollars are a novel concept on a Proof-of-Work blockchain.
• Privacy considerations in cash transactions differ from those in the crypto space.
• Scalability is a crucial factor in the programmability of blockchain technologies.
• The discussion delves into the evolutionary aspects of the ongoing crypto revolution.
• Comparisons between cash and crypto privacy shed light on the dynamics of financial anonymity.
• Blockchain's decentralized nature highlights potential shifts in privacy paradigms.
• The implications of programmable blockchains go beyond traditional financial systems.
• Debates on privacy continue to shape the narrative of financial autonomy and security.
• Understanding the nuances of privacy in financial transactions is essential for future innovations.
• Exploring how decentralized currencies impact privacy perceptions and adoption.

Behind the Mic

Introduction and Welcome

Howdy, everybody. Welcome to the space. Please bear with us a few moments here while we get all our panel in attendance. How's it going? Everybody can hear me? Yep. Sure can. I think we have like two out of six speakers currently. You want to ping them? Yep, working on that right now. What's going on, everybody? Glad to be on the space. Howdy, Alan. Appreciate you joining. You guys. See, we got almost 1000 listeners on the last one and that was mostly just the quiet account. It's pretty good. Space listeners are going up into the right hockey stick. That's what we need. I think we got a few, we. Got two more, it looks like. Yeah, speakers work, I believe is here anyway, during the space. We'll give it another minute, but if people have questions that are of interest, feel free to drop them in a comment. We'll be looking at them, so might pick through them, answer them if they're good.

Discussing the Topic

Yeah, the space is pretty loaded. Definitely a dense topic to get through. We talk about privacy and all the different things that crypto can do to help address it. Well, if it isn't a dense topic, why would you talk about it? Yeah, the news on the FBI having their token launched. It's pretty relevant to this fucking shitcoin. That was pretty funny, man. I do have to say like, I. Would definitely love to hear that meeting on how that went down where the one guy in the FBI was like, hey, guys, we should launch our own tokenization. I got a great idea, boys. What was the name of it, too? It was pretty funny. It was like an AI thing, right? It was like, it was like AI nFt. It was like, suit is like you could see it and it was like fed coin. You know, like the way it was worded, you can like definitely tell that. The fed, now you're saying it's fed coin.

Concerns About Privacy

You probably have friends in your DM's who are like, oh, you know what, guys? You guys all have feds for friends and they're probably all, you know, reporting you to the FBI. And I'm definitely not a fed. Yeah, I hate the feds. Right? It's probably what your dm's look like. There's probably fed in this space right now. They're among us. Well, at the end of the day, we're just building utility for people and it is perfectly legal. It's a great way to start a privacy space. Okay, I think we got enough preamble in here. Let's, let's get this going, Matt. Yeah, appreciate it, guys. Looks like we're still waiting on two, so I'll keep my eyes peeled and see if they join and add them up as we go along. All right, let's. Hey, YJ, I see you requested. If we have time near the end, I'll let you come up, but for now, we're going to focus on our current panel. Appreciate it, though.

Discussion on Privacy

So welcome, everybody. Appreciate the time, the attention, the space. And we're going to have a discussion about privacy and crypto. How much privacy is necessary? What are the differences between cash and crypto? Where are we at today and where do we go from here? We have some folks who are probably just getting introduced to the quiet network and our audience as well. So I thought to kind of like set the stage and help get some introductions out of the way. I'd ask just a simple question and then kind of pass the mic around, give everybody a chance to speak. Let's go with this. How does everybody think about privacy when they're using the traditional finance system, either cash or cards, such as visa? And how does that impact your spending, if at all? And let's hand it off to Alan and Doctor K. And then we'll just go around the room. Raise your hand when you're ready.

Different Perspectives on Privacy

That was on a different screen. Yeah. So looking at privacy, crypto originally meant to be facilitated as cash, and having these public infrastructure networks that are operated by anyone that can come in and contribute is a new novel thing that blockchain has facilitated and given to people, really since cash, and cash is that first public payments infrastructure and our money supply and the way that we've used money has really been distorted by these private institutions. So I'm excited about the ability for crypto to rein that back in, operate payments and finance on public infrastructure and bringing some semblance of ownership and privacy back to individuals. I don't think crypto has necessarily filled that void yet, but there's a lot of trade offs that we're working on to improve privacy in those areas. Thanks, Alan. I'll just add, Alan's a CTO here at the team developing quiet network. If we could.

Introduction of Panelists

Let's do some real brief introductions as we answer these questions. Thanks, team. Sure. Yep. CEO of Dominant Strategies, co founder of the Quad protocol. Excited to chat more. Yeah, this is Doctor K, CTO at dominant strategies, building a the tech behind Klein network. In terms of sort of my relationship with the traditional financial system and privacy, I actually find myself using cards almost ubiquitously at this point. Certainly not out of preference. It's kind of out of convenience. And a lot of stores have stopped sort of allowing for cash. Right? That being said, there are definitely situations where maybe crypto comes into play just because it has sort of transnational properties that you can't easily get with payment rails quickly. So certainly use it for that from time to time.

Concerns Regarding Privacy

I will say from my perspective, just with regards to privacy in the financial system, at least, it is currently siloed, even if you're not using cash. So when you use your card issuer is really the only one privy to your transactions, or if you're using bank card, your bank. Now, obviously, those things can be discovered under law enforcement action or subpoena. I'm not really necessarily concerned with that at the moment within the United States, because we're not yet persecuting people for their opinions or political views. But that certainly has happened elsewhere in recent times, including our northern neighbors, Canada. So I'm definitely concerned with it on a macro scale. And I would love it if there was a way to more easily use something like cash, potentially in digital format, to really accommodate how we live and transact today.

Exploring the Concept of Privacy

Thanks, doctor K. 100 x podcast, I think. I'm pretty sure you raised your hand first. Feel free. Yeah, thank you guys for having me so much. It was really great to be here. When I saw that choir was on the ex co host, I was like, oh, man, that's really awesome to see. For anyone who doesn't know the 100 X podcast, my name is Cesar, one of the co host for the podcast. Our goal with the program is really making crypto for everyday people, taking really complex conversations with protocols, projects, games, anything in between in the space and really putting it in a way that is really easy to understand, especially for new people that are just starting out in the space. And it's really awesome to see. Quiet now we're here because I was actually looking when we had our podcast with you guys back in January of this year, I think with Alan yourself, man.

Privacy Challenges in the Real World

So I pinned it up here for anyone who hasn't had the chance to see that episode, really awesome stuff that you guys are building. And when it comes to privacy, I think it's really hard because I understand with crypto, you know, we're here for a little bit layer of privacy as well. But anytime I use anything that's not cash in the real world, I have to understand that, like, hey, if somebody wanted to, this transaction could be tracked or could be traced in some way, which is a really weird thing to really think about when you release it down and think, like, dang, I really don't have any privacy if I'm not using anything other than cash. Really interesting concept here, and I'm really excited for this conversation. Awesome.

Diverse Perspectives on Privacy

Thank you, sir. Go ahead, cosmic. Hey, guys, it's Assad from Cosmic. CEO. Yeah, CEO of Cosmic Network here. Thanks a lot for having me as well, first of all. But, yeah, just to answer your questions. So, cosmic network, I mean, we're a decentralized VPN platform, so privacy is very much at the core of everything that we do in terms of our principles. And that question as well. When you say, when it comes to cash versus crypto, I mean, I know like one of the other speakers said as well, using. Using, like, card and things like that has become almost like the de facto way of paying for things. But, you know, I think that privacy element is massively important to have because, like, what is going on around the world, you do not know what's going to be made illegal, when, in all honesty.

Privacy and Legislation

And that just doesn't cover, obviously, the. The immoral things. You know, there could be something very simple where it's just been outlawed just because that's the choice of the government at that particular time. So, yeah, we feel crypto is the potential answer to that in terms of. I don't think we're quite there yet. I think there's a little bit more development that needs to happen, but we're heading in the right direction, I believe so, yeah. It's something that we can definitely all work on. I'll second that. Cluster, I think you had your hand up for a minute, but you dropped it. Feel free. By the way, this is my j. So, yeah, I was trying to come from a personal account, but you didn't let me, and so I got here from the official account.

Privacy Coins and Opinions

So, yeah, this is why j co founder protocol. what I believe in terms of privacy is because, like, consider it in a way that. Okay, cash versus crypto. So the very first thing that you, spike in your mind is those privacy coins, right? That, turn out of cash or these coins, which are there. So you. Some of the, things which. Which we can talk about. But then there are other side of things as well when we talk about these privacy coins, right. For someone who's a newbie, some. Some crypto currency or some crypto coin, which can, like, help you not trace the transactions, or you could say, not trace who owns those coins. And. But still, it's on a public issue, are those privacy coins?

Questions About Privacy Needs

So, like, I think, like, it would be an interesting discussion to take ahead around how much privacy is necessary, like, with the cash versus circle. So. Yeah. Like, would be interested to have the conversation ahead alongside with other panelists. Yeah. Hey, real quick, Matt, I just want to maybe put, like, a frame around this before we get into discussion more. Sure, go ahead. Specifically, I just want everyone to be kind of aware of what happened in Canada. Right. Canada is supposed to be a free country. It's supposed to be a progressive democracy. But they had one of the most fascist like, things happen not more than a year and a half ago, and it has to do with canadian truckers.

The Truckers Protests in Canada

So what happened was the truckers in Canada were being forced by the central government to get a COVID vaccine. And many of these truckers were saying, we work alone, we work outdoors. We don't need to take a COVID vaccine. It's experimental, and we don't want to take it. We don't think it's safe. So they were told by the government, if you want to work, you're going to have to get the vaccine. So they ended up creating a protest in the capital. They all. They went, they parked their trucks. They kind of, like, did. What people do in a democracy is they petition their government to be heard. And this was sort of taking over the capital, making it hard to commute. And it was creating a headache for Justin Trudeau. So what he did, instead of listening to the right of people to have bodily autonomy, like one of the most fundamental rights, he decided to declare an emergency.

Government's Response to Protests

And with this emergency, he made it so he could confiscate people's trucks. He made it so that he could confiscate money out of people's bank accounts. But most egregiously, anybody who donated money to the truckers say $20. He used his emergency authority to freeze any other assets that were linked to the account they sent the $20 from. So when we talk about privacy and we talk about censorship and we talk about overreach of government, and we talk about being able to actuate free speech to petition your government so that they represent your interests, this is, like, the perfect example of the most egregious form of overreach that could possibly happen. Peaceful demonstrations over having sovereign bodily autonomy and then being coercively shut down by choking off the financial system madness.

Understanding Privacy in Context

So, like, when we talk about privacy, it's not this abstract concept. It is the first derivative of free speech and being free individuals in a representative democracy. Hear, hear. Yeah, I think the impacts are becoming realer and realer every day. Optio you have your hand up. Go ahead. You know, whatever thoughts you have, and please introduce yourself if you're speaking, we can't hear you, unfortunately. Now, is anybody else here? Optio, I do not hear him. Okay. All right. I just got a thumbs down. So anyway, I just want to frame this as like, privacy is no longer a thing that we may need in the future.

Importance of Privacy Today

There have been examples of it where we would have benefited from it a year ago. Right. And with more technology and more sort of big brother activity from government is becoming more and more important because all governments ultimately should be deriving the power from their population. So how do you have free speech? How do you have the ability to petition them if you don't have some sort of. Sort of economic freedom about what you do, what you support, and how you express your speech? You don't. So, like, privacy in the financial system is as important as free speech? Yeah. Realer today, I think, than it's been in all of our lifetimes.

Continuing the Discussion

Probably cosmic. You want to riff on that? Go ahead, sir. Yeah, no, for sure. I mean, I didn't know it was that bad in Canada. I remember seeing the truckers protest there, but, like, freezing people's assets just for like a donation, that's like a massive overreach. I mean, we've had things like that in the UK. I haven't seen anything as bad as that, especially around the COVID times as well. Every single government seemed to just go into overdrive with what they were doing, trying to do. And what we saw a lot of here was people across the world as well, to be fair, was people's speech. And just because they were speaking out against the government and not even just speaking out, just questioning things really, as to, like, okay, why is this happening?

The Questions around Government Actions

What is the need? Please, can someone give me some explanation? Is that. Yeah, we saw a lot of them, but, you know, for them to actually have the ability to go in there and just freeze people's assets, which I know for anybody out there, everybody's got bills to pay, everybody's got to put food on the table, all that stuff, for them to be able to do that so easily, it just shows how. How desperately we need something like this. Yeah, I'll just give another example. Because, like, I think one of the problems is when we talk about privacy and we talk about these ideas, it just seems so ethereal to people that we need to frame it properly so that people care about it. Right.

Historical Examples of Privacy Issues

So I'll give one other example. I think this is almost seven, eight years old. So this, like, predates Covid by quite a bit. But the CEO of Firefox or Mozilla. Sorry, got fired in, like, 20. It was maybe it was, like, 2014, because six or seven years earlier, he had donated money to a PAC that was against or that supported a referendum in California, which ultimately passed, that was against gay marriage. Okay, and I'm making no comments here on, like, gay marriage, but the interesting part about this is that when he donated that money, the two prominent candidates for the democratic presidency also did not support gay marriage.

Consequences of Lacking Privacy

So this guy wasn't, like, an extremist. He was, like, dead center or left of center in his support of this referendum. And six or seven years after the fact, they found out about it, decided that was, like, quote unquote, a far right stance at that point, and then fired him for it. And because we don't have privacy, this is specifically to a disclosure in the political campaign donation, but an example of economics being used to coerce, lack of having, freedom of petition and speech. This is, like, a great example, but it's also this crazy example where this guy was in alignment with the center when this happened, and then, like, seven years hence, they're like, oh, no, you're far right, and they got them canned.

Reflections on Overreach and Privacy

That's all. Great context, cluster. I think you had your hand raised. Did you have something to add? Yeah, a couple of things to add there to which. What Doctor K said that. And it's really shocking to see that. Okay, so one hand, see, there is politics in every democratic nation, right, or in every democratic city or state, and even if you are aligned with the ruling party, which is in power, that's just sad to see. Like, it's just because of the fact, and it's just because of the fact that some. You donated some money out of for something, and you are being, like, dragged over that.

Introduction to Parler and Its Shutdown

And, man, this conversation couldn't be perfect for us. More perfect for us. Me and my partners acquired a social media platform you might have heard of called Parlor that was shut down for all of these very reasons that we're talking about. Parler emerged in 2018 as the free speech platform that we will not deplatform you platform. And Amazon Big tech decided to shut it down. So it took us a couple of years, we revamped it, and now we've launched it on a blockchain and built utility within the application. So not only when you guys are talking about the freedom of, the use of money, you're absolutely right that the way that we use money and access the financial system is a freedom of expression problem. And as we look at what's going on around the world right now with the, with everybody, all these governments trying to silence the people, this is horrifying stuff.

Big Tech's Influence on Platforms

This is another interesting waypoint in our discussion related around privacy and economics and freedom of speech parlor was a crazy thing. You guys said you acquired it. But, like, the crazy part is when they shut that down, it was big tech basically just turning their servers off. And then I want to say they also got debanked, so they got, like, all their bank accounts taken from them, so they couldn't actually pay for services anymore, and then they couldn't find anyone to, like, host their platform. That's exactly right. And, and you know what's crazy is the media, not the government, but the media said that it was shut down because it was used in the insurrection on the Capitol. And what's interesting is post being turned off by Amazon and I have my own opinion as to why Amazon wanted it shut down, but we investigated the entire system. There wasn't one communication that was related to that day.

Discussion on Control and Data Ownership

So when you think about the power that big tech and the banks have, that is crazy. I mean, there were 20 million users on parlor when they shut it down and a lot of users overseas that didn't even give a crap about american politics. So you think about what. And as we frame this around crypto, I like to frame it around blockchain more than just crypto, because I believe that we're going to, the process that we're going through right now is we're going to change the paradigm. Big tech is, has turned our personal data, behavioral data, that the things we think about, the things we care about, the things we love and hate, they've turned all of that into a $2.5 trillion industry. And we the people should own that data. And with the blockchain, we're able to do that. We're able to allow the users to keep and monetize their data if they choose. And quite frankly, I think all of us in the so called crypto space, I don't like necessarily that term because it'd be like, that'd be like saying we're in the dollar industry, but in, but if you think about it, blockchain and its ability to have immutable records and the ability to lock those immutable records, we can now give the power truly back to the people.

Reflecting on Data Privacy and Surveillance

Their hand up, though. Hold on, hold on. He can't tease us like that. I want to hear why he thinks AWS shut them down. Well, well, obviously this is just an opinion, but aws, I don't even know if I should say it out loud. Aws, I believe, was trying to win more of Twitter's business, and they saw Parler at the time as a competitor to that because it grew incredibly fast. So that's just my gut feeling, but I don't know. But the fact that big tech and the big banks have that much control in our life, that to me is even scarier than what was going on in the forties in Germany. Claustropho, you want to go ahead? Yes, I want to go ahead. But there are three different opinions and three different thought processes that are there in my mind. First things first. So when we are talking about the us politics.

Impact of Governments and Economic Systems

So wanted to know from all of you guys, like if in case we have a government, right, that there is a debate between Donald Trump and other opposition and Donald Trump is considered to be more friendly towards the blockchain and the crypto thing. And if in case, like there are rumors around, if in case he comes into action, then there would be like as a measure of the economy around, revolves around us, there would be some action in the crypto space happening around also to the point where optio mentioned about how like how important it is, for like privacy of data and stuff. Right. So there. I would love to do a quick chill about cluster, I hope. it's all right. So, yeah, so for there, like, we are building a platform, right, where. So, so. And it's a genuine problem, right? It's a genuine problem for AI developers to monetize their creations.

Big Tech's Data Capture and Monetization

And as well as if you see about the data that is being captured by all these big techs as offshore talked about, that most of our decisions, most of our activities are tracked by these big techs and most of our decisions are influenced by them. A real life use case and example to this would be the Google Ad system, right? So if in case you search something around, you will be targeted with ads, overdose. All of your platforms, be it your laptop, be it your computer, beat your smartphone everywhere, you just see those ads and it's a pushy sale kind of a thing, which you will be having around. So yeah, based on that monetization of that data is important for the users, the right monetization should be done. And that's where, and it's not just about cluster, but all these platforms which are built towards monetizing the user's data by providing privacy layer on that data is something that is important to look forward for.

The Future of AI Development and Data Privacy

On top of that, for AI developers, right? Because when we are moving towards the era where AI is the crucial thing, it's the only thing that we are seeing as the future, if, in case someone is seeing. So I am a core supporter of this fact that, yes, if you have seen my profile as well, I've written e acc. So that just simply means that AI should be developed at any cost. That is what it means. That is something kind of an opinion or kind of a belief for certain folks that AI development should happen at any cost. So if we believe, and if there is a community or a part of community that believes in that thing, then yeah, then we should make sure that these things should be considered in terms of having the data privacy. And that is also another factor. And there were rumors like how secure is telegram, how private is telegram? As well as there were also rumors about telegram getting banned as well as telegram. Might share these chats with the governments for inquiries which are political or which are around criminal cases or stuff like that.

Privacy in Blockchain and Monetary Systems

So would love to know opinion from all the panel around over all these stuff. Well, so maybe to kind of focus in the conversation a little bit here, specifically with regards to privacy in sort of crypto blockchains and money and cash, maybe I can just give like a little bit of background to sort of frame the conversation. So presently, sort of in these systems, if you look at something like bitcoin effectively has zero privacy. Even when you use tools like samurai, which has been shut down, it's still hard to get good sort of anonymity using something like bitcoin because of things like address reuse, but also just because SATs create identifiable denominations. If we look at something like an account based system like Ethereum is perfectly trackable. I would say bitcoin is generally perfectly trackable. And then you have systems that are not like that.

Comparative Analysis of Privacy Solutions

So I think sort of the best sort of landmark of privacy is Monero, because it uses a process of ring signatures and mix ins to sort of make it so I can't see amounts. And I have sort of an uncertainty about who's sending what to whom in every transaction. The other thing that it has that I think is like sort of a key piece that very few other systems have is that it's a requirement. Meaning every Monero transaction is a ring signature. It's not some optionality, it's not some subset. And that actually is probably why Monero is the most private thing out there. Sort of in the middle, you have things like zcash or tornado cache, and they're using zero knowledge proofs, which cryptographically that's fine, but they're only doing it on a subset of transactions. So when you're sort of in that subset of the pool, you may have a modicum of privacy, but entering and exiting that pool back into sort of like a known set always reveals data.

Challenges of Privacy and Anonymity in Cryptocurrency

And it's relatively easy to track on either side. So there's a sort of temporal analysis that can be done to sort of figure out, you know, as you transit this sort of like subset, which kind of acts like a mixer that will ultimately still reveal your data. So when we're talking about what exists in the world, we have bitcoin which basically, I would say, has the worst privacy on the planet in some ways. Then you have sort of these middle systems that create good privacies for subsets, but you lose the privacy when you enter an exit. And then you probably have like Monero in the crypto space. That's sort of like the continuum of privacy. Does anyone have any, like a size or things to add to that?

Extending Privacy on Ethereum and ENS

Yeah, I can add just a quick thing. So I also believe these ENS systems, right, these Ens domains and all these domains which are built is something which is anti, what you say anti privacy or something. Because let's say, okay, I am a yemenite guy, and I just bought, okay, cluster eth on. On one of the, what you say on. On one of the, our wallet, right? Let's say it is an Erc wallet. And I bought that off. So now, it is being boxed, right. You might be understanding with some research, with some, you can understand that this, wallet belongs to cluster now, to all the transactions that will be going from here and to some other wallets. It's like, it is easily trackable to say that, okay, there is a footprint of cluster into it. You cannot say what exactly that those transactions are done for. It might be a possibility, it might be some expense or there might be multiple things which you can talk about.

Impacts on Privacy Due to ON-Chain Identifiers

But I think these ens domains and all these domains, wherever you have, like, you can even take alias as well. But I think it's kind of anti towards anti privacy. Like, would love to know opinion from the panel around here. Yeah, I'll jump in there and say, you know, on the ENS, you're absolutely right. That was one of the things early on in the Ethereum ecosystem that people were pretty in love with. And people still to this day use ens in their Twitter handle. They'll have it across many different blockchains. And there's real risk associated with that. You have people that are able to look directly at your ens that you're publicly using and go see your wallet. And that's something that not a lot of people are directly aware of whenever they want to publicize or get paid out of EnS.

Concerns Regarding Wallet Addresses and Identity

And not only having it just on Ethereum, but if you link your layer two wallets or you link other different ecosystems there, then you're really showing all of your transaction activity across all these different blockchains. So I think you're absolutely right. Just in terms of the privacy concerns around having labeling on a DNS system like that it looks like 100 x. Because the very first thing that you had was that the blockchain had was with a wallet, is your digital identity is just an alphanumeric number. It is not associated with a name or with something that has. Okay, Xyz Eth or Xyz Bnb or something like that. Secondly, what I think is these NFTs, where there are these social platforms that issues NFT and that has the metadata of my name, maybe. Or maybe something which can resonate.

The Downside of NFT Transparency

So this is also something that I think is anti privacy when we talk about the true layer of reaching privacy in terms of using a wallet. Hundred x. You got something? Yeah, I just wanted to add a little bit to the conversation, thinking back at the main question for the space. Right? How much privacy is necessary? I've just been sitting here really hearing everybody's. Can you guys hear 100 x? Yeah, we can hear. Yeah, we can hear. Okay, I just want to make sure I wasn't rugging. Yeah, I've just been sitting here listening to everyone's takes and seeing the different points that Doctor K also brought up. And I think when I try to answer the question of how much privacy is necessary, I always really like to think about the new user that's coming into crypto and what their sort of experience is going to be like using these different systems that we have in place, whether that's bitcoin, whether that's ethereum, whether that's quiet, whether that's another layer one, or a whole nother blockchain in general.

User Experience in Cryptocurrency Transactions

And I think it's really going to depend on to what they need to be doing for that specific transaction. We talked about the Ens, and I think there is some validity to the idea of, like, you do lose a lot of the privacy when you do something like this, but also for someone that's just going to be trading normal things and wants that specific following to know what they're trading or they're doing a specific niche, I think it really comes down to what are you doing on the blockchain and does it require privacy? I've come to be aware that I forego a lot of privacy on my day to day life in exchange for convenience. I use Apple pay pretty much everywhere I go. I rarely, if not ever, try not to carry my wallethood and just rather pay everything through my phone out of convenience.

Weighing Privacy Against Convenience

I know that's definitely not the way to go if you're looking for somewhere private. But if I'm trying to send money, maybe to someone in another country or someone where it's really hard to go through the regular financial routes, then I'm looking. Then I look more towards crypto, because now I don't have to worry about maybe remittance, another country or any sort of crazy fees. Now I can just send money directly to people in a more anonymous way without having to really worry about all those restrictions. I think the privacy needed for each individual person really comes down to the utility that they're trying to do. And I think people will find those specific use cases in crypto based on what they're looking for, where I think a lot of these different utilities, the more private you get, the more niche it gets, because when you usually go for more private route, it really does take away a lot of that convenience from the user itself.

Balancing Utility with Data Privacy

I think it's gonna be a really nice balance, but I think all these solutions that we've been talking about in this space will really find the right users, especially if they're looking for them. Yeah, absolutely. And having the convenience is a huge factor. And I don't know if that's necessarily a privacy constraint, but more so, just crypto hasn't gotten to that point yet, and we haven't gotten the adoption and the acceptance, whether it's a point of sale terminal or being able to send money to someone easily on an app. And the ideal thing was privacy by default in many cases. And instead, we have to struggle to find that privacy. So you have to jump through those hurt hoops, get onboarded onto these systems, and remove a lot of that easy use that you get from, like, an apple pay.

The Need for Improved Privacy Solutions

But going back to even some of the news that were talking about just today, I think this is more so breaking news. Eleven minutes ago that fidelity had a breach that impacted 77,000 customers across Social Security. Numbers, licenses, personal information. And when we talk about privacy, and we have these large systems that are really custodians of not only our money, but our data and our information that is used in our, you know, well held close information and information, that's a. That's a risky thing. So privacy really obfuscates that as well, not only from the access and ease of use, but from the data that's needed. And we discussed, too, about the people that are, of getting unbanked and the people that are getting their assets removed.

Concerns with Centralized Control

And I'm relating it back to the truckers and in Britain and more. So I think you're absolutely right. But it's up to us as the people building in crypto to make it easier to get that privacy by default. Okay. Okay, I gotta. I gotta interject here. Just so cosmic. And then Optia. Yeah. When we're talking about using Ethereum with or without ens addresses, you should have zero expectations of privacy. Everything that you have ever done in an EVM environment, you should expect that to be known that you did it at some point in the future by literally everybody. Chain analytic companies, if you are on an EVM system, know everything about everybody, and they can likely tell you exactly what meme coin you traded last month, regardless of, like, how far away you think you are from an exchange and sort of how private you think your wallet is or what your address use is, like, they know exactly who you are.

The Transparency of Ethereum

It's pretty transparent. Go ahead, cosmic. Yeah, to me, that's my point was adding to that as well. It's kind of like, especially on Ethereum. And if you're trading there as such, really, it's not private. Everything is there on the blockchain. But what is the crossover between privacy and anonymity as well? Really? That's kind of like the. I think a big question is kind of like, are the two the same thing? Are they. Do they fit the same mold? Or are they two separate things altogether? Is what we're really looking for, is it that anonymity, in terms of what we're able to do?

Exploring Privacy and Anonymity Distinctions

Well, let me just respond to that, though. I would argue that given the number of KYC AML points that exist and what effectively are known accounts, there is no difference between privacy and anonymity. In this case, I don't even think you have anonymity. You might have it generally if somebody without a tool is looking at the blockchain. But if somebody with a tool or like, somebody with a little more power wants to figure out you have neither privacy nor anonymity. Yeah, true. Yeah. Very true. So Doctor K here is just talking about Zack Xbox. Yeah. Let's go to optio. He's had his hand up for a while.

Advocacy for Anonymity

Yeah. So I actually want to ask a rhetorical question. Are we advocating in this discussion, are we advocating that anonymity and privacy of where you spend your funds is a problem that we all need to solve? And maybe it's not rhetorical. Maybe I'd like to hear what you guys think about that. No, that's a great question. Sorry. Stand by. And, yeah, I mean, I think the question is, where do you draw the line? Right? Because obviously no one will support people being able to fund a terrorist organization or anything like that, using crypto as such, really. But also at the same time, like the, like what happened in Canada, just because the government at that time deemed that not to be acceptable, they decided to overstep that line.

Challenges in Regulation and Oversight

So who's responsible for putting that line in the sand and saying what is allowed and what isn't allowed? And that's always going to be the challenge with crypto, in all honesty. Right. And that's why, you know, the topics title, cash versus crypto. Right. I think there, especially from a regulatory perspective, there seems to be a level of acceptance in the privacy allowed with cash. Crypto probably has a long way to get there. So I would say, actually, yeah, there is a line. I think the question for crypto is, where is it, and how do we get there? Yeah. I would say that if you look at these concepts of KYC, AML, these are actually relatively new concepts, especially used with the amounts that they're used by and the frequency which they're used by.

Historical Context of KYC and AML

If we go back 30 years, we didn't have any of these things, and people were able to investigate and stop criminal activity without having to have a surveillance apparatus into every transaction. In the financial system, it seems like law enforcement has just gotten lazy and then just decided to shred the concepts of the Fourth and Fifth Amendment so we could make their jobs easier. But from my perspective, when it comes to crypto, the balance is we should have the ability to have cash like transactions, but we need that not just from a point of individual privacy and points of free speech. I would argue that you need it just to be able to do basic commerce as a competitive company in a capitalistic setting.

Implications for Competitive Businesses

So if, for example, we actually had a scalable system of crypto, and it was on an account basis, and Chipotle exists and freebirds exists across the street, with something like an ethereum accounting system, Chipotle could see everything that freebirds is doing. They would know how many burritos they're selling, at what price, at what time of day, to what customers. They would know what they're paying their suppliers, so on and so forth. My argument would be just to have crypto used as a transactional mechanism. It needs to have cash like properties if competitive companies are ever going to. Use it, and to expand on that, I think when you look at visa and transacting and regional banks, I actually think that privacy in many cases is better than something like bitcoin, because you have different legislation in place, like the GLBA or GDPR and there's laws and access and steps and hoops that are required for the government to go and take purview into that ledger that a regional bank has.

A Comparison of Privacy Regulations

And so of course there's bank secrecy laws and things that affect your individual transactions that you do on a Mastercard or with your debit card. More specifically in that instance with a regional or local bank, but with something like bitcoin, you pretty much blow that wide open and you have people like Zackxbt that can go track down people with meme coin wallets and say, hey, this guy owns 5 million of this coin. And that actually becomes a health concern for these people in owning crypto. So I would say that the need for extended privacy is useful from not only I want the ability to spend this, but also how much you own and how that influences how you go about your day. And we haven't even gotten to the topic and it's definitely a can of worms, but there's definitely a real looming threat of cbdcs that impact crypto and impact the way that people transact on blockchain and how stable coins are used and how the privacy is influenced there.

The Role of CBDCs in Cryptocurrency

So I know I kind of opened up a few different areas, but would love to hear if people have thoughts there. Preston. Yeah. So I think there's two things. One is, and I have said this since the very beginning of my journey in bitcoin or in blockchain and crypto, all of us that were the early pioneers and were developing all of this stuff for various reasons, we created tools that are completely unfamiliar to the everyday person. You know, when Steve Jobs created the Macintosh computer, he put folders on the desktop because that's what people had on their desk. Right. And I think in crypto, we made this really weird leap where, you know, send me your wallet address and I'll send it to you and we'll wait for it, this, that and the other thing.

Bridging the Gap in User Experience

And it just became, it's very difficult to use now. The reason I put that into the framework of privacy, well, I don't advocate the ability. I'm sure most of you don't either. I don't want people using crypto to fund human trafficking, for example, and horrific things where we can't find them. I don't, I also don't advocate that the government get involved and be able to, you know, seize your funds or whatever. But I think until we as a community and as a broader community within the blockchain, until we normalize the use of it, where we could do Pos transactions at the counter, then we're going to continue to have these long and arduous discussions about how do we protect ourselves.

The Need for Normalization in Crypto Transactions

So I may be an advocate for the freedom and anonymity part in a slightly different way than. Than this discussion, because I don't. I'm not one of those that thinks that we should be, you know, completely unregulated. I think that regulation is good when it's done appropriately. But then would love to know, like, how an advocate can educate the basic, like the basics. Right? Because metamask is there for. For years. There are multiple, wallet inventions which are done. There is gasless wallets. There are, there's chain abstraction, account abstraction. There are multiple things which people are working upon. But still, crypto hasn't reached, that threshold of what you say of people widely accepting it from this point.

Challenges in Mass Adoption of Cryptocurrency

I also, got to remember this, the series which HBO released recently. It was shown in the series that when El Salvador accepted bitcoin as a legal tender, right there, it was that the president of El Salvador was influence of. Was an influence with some other pope who had invested interest in cryptocurrencies back when this thing happened a couple of years back. So, yeah. So what's the best way? I would love to ask from the panel, to make people educate about it. So, I'm just going to kind of circle in here. So, one of the things that Qui is trying to do is really answer sort of that Ui UX problem that was mentioned, and also just the general acceptance problem, which is build a system that can be used transactionally.

Building a Transactional System for Users

And with our concept of Qi or this energy dollar, we're building in a system where every user will have cash like properties when they use Qi. So they don't have to really know about privacy. They don't have to worry about privacy. They just load up their non custodial wallet, they can scan a QR code, pay for goods and services, and they will get cash like privacy guarantees. So that is one thing that we built into our system, because we think it is necessary, if you are working at scale, to have cache like properties. And the only way you can guarantee that is by baking those sort of into the core protocol. So that's kind of what we did.

Developing Cash-Like Properties in Crypto

And we believe that with that, we can offer sort of that transparent system where it's easy for the users to use it, easy for them to have privacy, and with that, be able to gain a higher degree of adoption. 100 x. You've been itching to speak. It sounds like. Go ahead. Oh, no, my bad. I just didn't want to cut anyone off. I think I just wanted to add something here. And this is sort of where the building on top of the point that I made last and wanting touch on what Alan said in terms of being, you know, the builder's responsibility to make these tools and privacy more like table stakes, instead of something that people have to look for, it's more like it just comes baked into the products that they already use.

The Builder's Responsibility in Privacy Design

and I think, unfortunately, society for the most part, I don't want to speak for everyone. I think most people were rather opt in for something that's convenient and the product itself, even if it doesn't have the privacy component. I think of a lot of, I mean, of a lot of the people that we talked to on the shows and everything, and a lot of the things that they're building, it's more for the user minded person. And I think just regular users aren't really thinking about their privacy too much, unfortunately. I think it's not until something bad happens where they get hacked or they get followed or somehow their data gets leaked and they're getting all these random calls, scam calls and everything, that people become aware of how loose they've been with their privacy.

User Awareness and Data Privacy

And I think what quiet is building, like Doctor K just mentioned, of having that privacy automatically baked into the product, where we are able to have that cash like property in crypto, I think is huge. But I also do think that I do challenge the notion of whether that's something that needs to be uniform across all of crypto, because I also do see the value of the ease of use that other blockchains have created. Well, where they do forego some of that privacy, because I do understand that building privacy centric first and then everything after does take a little bit longer time. But if Qui is able to build something that's able to have privacy at the base layer and then build all that utility and convenience afterwards, where it doesn't matter, like the difference between using ethereum and qui is negligible, both have the same sort of products, same sort of services that people can use because people are service centric.

Advantages of Privacy-Centric Blockchain Solutions

I'm going to go where I'm already using, the games that I'm playing, the protocols that I'm using, the things that I'm using, that's where I'm going to go, whether it's on this network or that network but if you tell me that all the same things that I'm already using are building with something that has privacy under it, that's a very unique selling point that I think that the space could definitely need. Just to add some clarity, from Qui's perspective, we actually have two tokens in our system. We have Qui, and Qui is EVM compatible, and it offers sort of the same privacy guarantees as, you know, the EVM, which are basically none. We then have Qi, which we call this energy dollar, which is meant to be an endogenous unit of account tied to the price of energy, and it has the properties of a medium of exchange, sort of through how we make it have cash like properties using fixed denomination utxo sets.

Token Dynamics and Use Cases

So we're kind of building what I would call a crypto monetary system, and that we're establishing something that has a store value but can also sort of easily deal with these traditional use cases of porting things over that are built on the EVM swaps, ERC 20s, Dexs games, what have you. But then we also have that endogenous cash unit, Qi, so that you can actually use crypto transactionally. It's actually a very challenging game to sort of create that expected utility and have privacy simultaneously. In the way we're accomplishing it is by having a split ledger. I have a quick question. Follow up for Doctor K. Do you guys have use cases already in place to show that the cash like crypto token is already being used? Yeah, so we're actually launching our first testnet that has Qi live in it on Tuesday next week.

Launch Plans for Qi Testnet

So we'll see what use cases are discovered.

Speculative Use Cases in Hashrate

I will say within our system, there is a native sort of speculative use case on hashrate that exists based off the relative emissions profiles of Qi and Kui. So Kui is really meant to be a deflationary token whose emissions sort of goes down over time and sort of approaches zero inflation, whereas Qi is really meant to have a fixed price but a variable supply. So the net effect is Qi can be used even if you're not using it as cash, but can be used as a mechanism to speculate on changes in the hash rate as well as the endogenous exchange rate in the protocol between Quiang Qi over time. So even if people aren't using it to go buy their lattes, miners and speculators may use it just as a mechanism for speculating on hashrate.

Privacy and Convenience in VPN Applications

Great question. Cosmic. I saw your hand raise. Did you have something to say? Yeah, I think it was just once, going back to the point about convenience as well. That's something that we've seen ourselves as well, when we've been doing a lot of our testing around our VPN app and everything is, what are people doing? Do they want to go kind of like the full privacy route and no one can see them, but they lose some element of that convenience? Or are they looking for the balance between the two and what we did personally? We set up different modes and settings, really where you could kind of go for that full privacy route and be very anonymous, or you could just have a VPN that gives you a bit like a basic level of protection, but still keeps some element of privacy.

Balancing Privacy and Usability

Because in the crypto world, yes, I think people tend to be more privacy focused and go for that part as well. But when you look at the rest of the population and the rest of the world, I think most people would choose convenience over privacy. And I don't know if I say a wider challenge that we have to address. Yeah, I guess my point from our perspective and how we're designing our product, our perspective is that we're making no compromises. Meaning if somebody is using quire, somebody's using qi, it's going to look just like they're going to look analogous to each other. So there's no sort of compromise from the user experience to get that cache like property.

User Experience in Decentralized Finance

It's really just. Do you preference sort of this deflationary asset that has smart contracts and no privacy, or do you preference this unit of account that probably has pretty stable purchasing power parity and cash like properties, but from the perspective of using it a to b, it should look exactly the same for our users. That's a great point. I think you guys are hitting the nail in the head on the usability. In my experience. You know, the. The privacy has to be baked in, but really kind of not a part of the pitch, especially if there's a hurdle in the user experience. Hey, Cosby, quick question about your guys's VPN service.

Payment Options and Premium Services

Do you guys take crypto? Monero? Anything for people to pay for their subscriptions. So at the moment, it is. It's a free app, which you can download on iOS and App store, but we are having our premium version coming out soon where people will be able to pay via crypto as well. I have another question. What's the differentiating feature between what you guys are offering and, say, a mole bat? What our network is built on, this is purely decentralized. So the way it operates is that people have nodes and they've set up nodes all over the world as such.

Challenges Faced by VPN Services

Really? So you're not kind of going through. Because the problem that you have with a lot of VPN's for like the regular, say you're in the place like in the Dubai, for example, where they routinely block IP addresses of VPN's as such. Really? Because the IP addresses and everything, it isn't a, like a centralized data server somewhere and all that stuff. It's very difficult for them to block that. And we've built the network, the underlying network is all based on the blockchain as well. So, yeah. Trying to very much go down the full decentralized route there. So can I make one other, I guess, interpolation?

Decentralized Systems and Privacy

When you were talking about earlier, about the different degrees of privacy, are you talking about effectively the number of hops that you're making through the routers? Yeah. Yes. So effectively, you guys have a decentralized sort of tor like system with payments. Yeah, effectively, yeah. Cool. Yeah. I'd invite anybody here to download our app on the app store or the play store as well. Actually, I'm kind of geeking out now, too. I got one question for you, actually. Cosmic. And then let's let cluster speak. So.

Tunneling Protocols and Usability

So your protocol for the actual tunneling, can you speak more about that? In my experience, the decentralized VPN's of recent passes are all kind of like web RTC based. Are you familiar with that? A little bit, yeah. I'm not technical, so I can try. Okay. Yeah, no sweat. But the tunneling, what I can do. Happy to fold over like our white paper and everything, where it's got that in a lot more detail. And I would truly. I'll be butchering it if I try to. That's what I'm googling right now.

Thoughts on Decentralized VPNs

Go ahead, cluster. No, so, yeah, like with decentralized VPN's, the very first thought that I have in mind, there are two thoughts that I have in mind. First is a three year package of NordVPN that is sold to me at a cheaper rate. And the second is all decentralized VPN's selling your data. So would love to know. Cosmic. Like, how are you tackling that off? Or if. In case you're tackling that off, if. Yes, then how? Yeah, so the data, what is a big issue and something that we recognize, especially what the.

No Logs Policy in VPN Services

A lot of the premise that the people have as well with free VPN, and it's true as well, we've seen those leaks ourselves, is people selling your data. They're collecting your data when you're using it. So that's why we've got a very strict no logs policy in place. Very similar to Movad as well. And Movad's a great example of it as well. It just, they're not decentralized really, just that they're one sticking point, but they have another, again, another no logs policy. So they actually had the swedish authorities try to raid them to get information, but they simply went there and they said, look, we simply, we don't have any logs.

Competing with Incumbents

When I think about kind of competing with the incumbent, it feels like something like the payment systems they have today, even the purely digital ones like PayPal, Venmo, the cash app square. How do we achieve something that's that ubiquitous and usable for mass market adoption? You spend years building an underlying scalable system that works in its truly decentralized format so that when you build the applications that live on top of it looks like building a web two app, because the base that is the blockchain and are the service providers are analogous and can scale at the same rate and to a higher degree of robustness. So you don't have to work in a heterogeneous environment, you don't have to work with fractured liquidity. Liquidity, you don't have to work with variable protocols. Right. That's literally how you do this. Right? It's not about like polishing a turd, it's about building a solid base on which you can build anything. That makes sense so effectively.

Building Applications on Blockchain

Quiet network has created, you know, I'll call it the value layer on top of TCP IP. Now it's up to somebody to build that web two app that rides on top of it. Yeah, I mean, that's the point, right? If you look at sort of any crypto system that's on a blockchain that gets any sort of product market fit and start to get adoption, if that's cryptokitties, literally an app to breed NFT cats, like, took Ethereum down, right? Because it got a modicum of adoption and Ethereum couldn't scale to handle it, right? If we, if we look at people using blockchains transactionally, there's places that have currencies that are much more unstable than the United States, like Buenos Aires, when they look to stable tokens, like USDC on BNB to use as means of transactions.

Scalability Issues in Blockchain

When they started adopting it, the fees went up because I can't scale and they got priced out. So they moved over to Tron and then the fees went up and they got priced out. So every application, if it's cats or if it's currency that's been built on these systems, which are fundamentally technically deficient and cannot scale with demand, will inevitably break and will inevitably create systems where you're trying to patch over them in the application layer because the base below it can't scale. How crazy would it be to say, I have a database and my database can't scale? So I'm going to create replicates of different shards of a database, and then I'm going to try to tie them together at the application level where each database has a different protocol and different set of information, and how I interact with it and has different assets on it. I mean, this is just pure madness, right?

Understanding Information Systems

So if you take the time to understand the physics, understand the information science, understand how a consensus is achieved in a distributed way, you can build a database that can chart, you can build a database that can scale. And then what the application sees is one endpoint like they traditionally see in web two development. That makes sense. I'm starting to think about the roadmap now. We have the CBDCs that are obviously coming. We have a mass adoption problem in crypto. We have very few projects working in this perspective, in my opinion. First we build that TCP IP, that layer on top of TCP IP for value. We build it with the forethought to enable cache like properties. And then obviously the simple web two apps come on top of that to compete with the PayPal, the Venmos, the squares.

Transitioning from Cash to Digital Payments

So it's seamless for the end user to switch between the two and obviously prefer one over the other because one has more utility. But we still have a lot of people using cash in the world writ large. We're seeing a decline here in the west, but you go into the rural areas and a bunch of my friends still carry a wad of cash around. And then globally, you have a lot of issues with their traditional financial system, which forces their local economies to only use cash where they don't use any kind of plastic to conduct transactions. So we have to get over that hump too. Am I thinking about this roadmap the same way you would think about it? And what's kind of the, I guess the time horizon there. How far out are some of these cbdcs? It feels like they're right around the corner.

The Launch of Decentralized Systems

Well, I think the important piece is that the system launches once the system launches. This isn't designed to be a centralized thing that is orchestrated. Right. We have built a digital organism based on incentive design that will like, be self-sufficient in the wild, right? So it's not about that thing coming to maturity, it's about that thing existing and existing in a way that it's robust and decentralized. So no matter what happens, it always survives. Right? Like, this system is designed to be a mold spore. This system is designed to be a tardigrade. Right. It's designed to self-replicate. It's designed to seek out nutrients. So, like, once it exists in the wild, I don't think you could ever kill it. That would be ideal.

Engagement and Community Interaction

Appreciate it. Doctor K. We've lost some of our panel, but. And I'm frankly out of questions, but we have some individuals here who requested to speak. If you all have any questions, feel free to speak up or raise your hand. Gabriel or hunk? Did you guys want to join in? Go ahead, Gabriel. Yeah. Thank you for bringing me up. I was the poster of that Peter Thiel quote, and I'm also going to call myself the human question factory because I have lots of questions that, Oh I. Well, I have a bunch of questions, but I think I'll start with. So let's just, like, run through, like, a trucker situation in the US with Kwai. Like, could you just, like, talk about, like, how.

Hypothetical Situations

Well, I'm just. I mean, I'm actually interested in, like, a bunch of kind of hypothetical situations. So something like what happened with the truckers where they're trying to, like, raise money. Also, like, you know, just a hypothetical. Like, the government sets up, like, a disinformation board and, like, say, I, like, try to start, you know, an organization that's gonna, you know, go against this, and then, you know, I get labeled as, like, a domestic terrorist or something. And, like, we're trying to raise money. Like, people are sending donations. The government makes it illegal to, like, donate to my organization. You know, like, I'm curious. Kind of like, how.

Impact of Government Action

How would Chi hold up to this? Like, would I want to use something like Monero or. I'm just interested if you could talk about if a system using QI was to come under fire, where you actually had really powerful government interests targeting either the people who are trying to raise money or the people who are donating money, how exactly would that play out? And what would be the risks? What would be. What wouldn't be? Yeah. So, right. Chi is this, like, interesting sort of straddle point, right? There's sort of sacrifices that we're making to go to scale, which means any individual transaction is less private than what it is in Monero.

Transaction Privacy in Blockchain

But the concept is, if everybody uses it in volume at large, you potentially get better properties in some regards. So if we're in a situation and you're doing every sort of day transactions and you're buying your groceries and buying your gas, and suddenly you're like, oh, these truckers. I support bodily autonomy and petitioning governments to defend that. I would like to send them 23. It is very unlikely that would be sort of able to be picked up if it's. If it's done that way. Okay, what about, like, if, what if the system was targeted more aggressively? Like, like, they. I mean, I don't know exactly what the political landscape, you know, might be, but, like, it's possible that.

Government Targeting and Response

That if for some reason the government sees, like, I have a strong feeling that, like, with some of the politicians who we currently have, like, if they started to see that there was, say, like, an organization that was raising significant amounts of money, that was harming them politically, that was using crypto, then they might, like, try to ban all of crypto. And, and also, just like you mentioned. Before. Oh, what was the. Oh, I forget the name of it, but there was an, oh, a samurai wallet, like, was shut down. And it sounds like that was more of a centralized thing, so it was easier for them to target.

Security and Resilience of Crypto Systems

But then Monero hasn't been shut down. But, like, would Monero be secure? Again, I'm sorry. Yeah, no, I mean. I mean, Monero is actually showing the degree of resilience that appropriately designed proof of work systems have. Basically, what the government, I think, has decided to is two things. One is that I don't think chain analytic companies have been able to unwind Monero. So their tact has been to shut it off by choking the exchanges. And that's why you're seeing Monero consistently being delisted from regulated exchanges. And I think that's sort of the attack vector that's most palpable in these systems.

Designing Resilient Systems

So when you're thinking about designing resilient systems, there's a couple of things you want to think about. So one is sort of the economic resilience of the consensus mechanism. You want to generate as many transactions as possible to create the greatest amount of revenue possible, so that the proof of work mechanism is economically secure and underlying that, you also want that system to be used as much as possible to create what I call social resilience. It's one thing to look at an asset like Monero or bitcoin, where there's some subset of users that maybe only make up 110, 20% of the sort of population, right? Because if I ban that politically, I'm only sort of disrupting so many people that are using it as a sort of speculative vehicle.

Political Implications of Banning Crypto

There's a certain amount of sort of political damage that is incurred from doing that. Now, on the other hand, if I can create a whole society that is doing a majority of their transactions in a cryptocurrency, and you suddenly try to ban that, and a person can't buy food for their kids or gas for their car, that is politically catastrophic. That is self inflation. That is a degree of social resilience that you can achieve if you can scale to the point that people can use this transactionally. So would you say the attack vector there is effectively, if you sanction the technology, you're choking yourself out from the rest of the world and basically sacrificing your own economic viability and then just generally shutting down the system is protected through scale as well.

The Future of Crypto in Different Jurisdictions

Economically. Yeah, well, I mean, and I misused the word. I should have said emulation, not inflation. Yeah. I would say from a societal standpoint, the fact that there's 196 jurisdictions, nation-states in the world creates a very interesting thing, because what crypto is really promising to do, if it can become digital cash and can have low fees and have economic security, can be used ubiquitously for transactions. What we're actually talking about is a vastly more efficient mechanism for creating commerce and wealth in society. So the jurisdictions that decide to ban it will become backwaters, and the jurisdictions that decide to embrace it will become the efficient future of the world.

Embracing Innovation

So I think that there's jurisdictional resilience, because I don't think all places will try to ban cryptos, and those that embrace it will gain economic advantage that will win out over time. Time. Got it. That makes sense. Did you have another question, Gabriel? I'm thinking, thank you for the answer. Yeah, appreciate it, Doctor K. And I think that's also why went with GPU mining as well. Right. Just creating that distribution and allowing for that mold spore to take root. You've mentioned in the past how effectively, by using GPU's, you're also forcing the distribution, by causing the states to consider whether or not sanctioning that product is also crippling themselves in other technological aspects as well, and economic opportunities with, say, AI and other industries that depend on this tech.

Decentralization and Distribution of Technology

Would you say that's kind of like the general gist of why went this direction? Yeah, so, I mean, yeah, exactly. So with GPU's, you know, you, when designing these systems, like, we're just trying to design a system to create the greatest amount of utility for the greatest number of people, period. Right. And if we can do that, we can generate the most economically resilient system that exists. That's why you want to scale, that's why you want to have this used for smart contract in finance, and why you want it to be used for meme tokens. We want it to be used for nfts and you want it to be used for cash and you want it to be used for everything it can possibly be used for that willing to economically pay to get unchanged, right?

Achieving Greater Economic Resilience

That generates the greatest amount of revenue, that generates the greatest amount of economic resilience, that creates the greatest degree of social resilience. And if we look at GPU's, to your point, their general purpose, right, the one thing that jurisdictions are very good at is managing import exports. So if you had an ASIC, and the ASIC was the way to sort of participate in the network, and they decided they didn't want their population having access in that network, they could very easily shut down the movement of ASIcs across their borders. But with GPU's, they already exist in large number and they're used for many applications.

Challenges to Control over Technology

So if you were to try to sort of shut those things down, you would have a very tough time doing so because it would have knock on economic impacts in your AI industry, in your rendering of graphics and 3d works, in gaming, so on and so forth. So by being dependent on more ubiquitously available hardware, it makes it harder for the system to be controlled. And that is a design choice. I have a question just to press against that, because it also does tie to privacy. Would there be some kind of attack though still, where like say the FBI does what they kind of did with Tor and they start like setting up a bunch of quinodes and they could potentially run some very big quiet, and aren't those nodes going to be interacting with other nodes?

Privacy and Surveillance Concerns

And then they could get like IP addresses and sort of just, you know, just be able to pinpoint all the people who are connecting to the network and just shut them down one by one? I might not be understanding the technology underneath this, but I'm curious, a situation like that. So you're highlighting the weakness of the underlying TCP IP layer in terms of management and tracking, and we have ancillary tools to deal with that. And those same tools could be used here for people that sort of get shut down. So, you know, people in Brazil that can't access x, they use a VPN, and similarly, you could do the same thing if you wanted to sort of access the network.

Utilizing VPNs for Security

Oh, got it. Okay, so standard kind of like VPN technologies and others like that could solve that particular, like, vulnerability. Yeah, so, I mean, this is in qui, we're using lib p, two P. And there's also kind of like interesting mechanisms in how transactions propagate. So there's actually an incentive for miners to propagate sets of transactions and what we call workshares. So then that means that like, the hash rate becomes ingress points. So you could create your own ingress point, or you could have like a trusted ingress point, but you don't need to communicate with the entirety of the network. If you have that ingress point or the trusted ingress point, you're sort of anonymized into that set.

Building Anonymity into the System

So there are some inbuilt features that hasn't really been a focus, but those are kind of ideas and technologies can be overlaid into the system independent of the protocol. Okay, interesting. Thank you. Really appreciate it. Doctor K, thanks for the questions. Gabriel. We're coming close up on 2 hours here, and I think we've hammered this point home pretty well. I'm going to attempt to summarize. Doctor K, help me out here. If I'd step out of line. You know, effectively, we're racing against the CBDC, which has absolutely zero privacy, and frankly, it could potentially enable some financial slavery and some authoritarian regimes and actions like we've seen in recent history.

The Urgency of Privacy in Crypto

This problem is becoming realer and realer every day. And we do that by really building a value layer on the Internet that can demonstrate cash like properties, enables at least a level of privacy that's satisfying the expectations of the current financial system and what's acceptable. And we do that with a robust system that enables some payment rails on top of it, or rails is the wrong term here, maybe payment apps on top of it that can compete head to head with what people are used today. Then we achieve security through the mass distribution and decentralization through GPU's, on a system that can scale to satisfy, frankly, the world. And so hopefully achieving a stateless global peer to peer economy.

Creating a Statless Global Economy

And that's how we beat out the CBDC, by providing that mass utility to the global economy. Yeah, that's right. I think when we're thinking about these systems, they're sort of like a lot of tech, but it really comes down to really a singular idea. Can you build a better system than the alternative, that creates greater value for its users? And if you do that, users will adopt it. That's like the goal, right? Right. Something that's materially better than the incumbent and capable of mass adoption. Right. And that's.

Taking Time to Innovate

That's why we've taken so long to build qui is because, you know, we're not here to make a roadmap. We're not here to make a fragile system. We're not here to make something that doesn't create a economically decentralized, credibly neutral monetary system like that is our goal. So to do that has taken tremendous amounts of effort and innovation over multiple years to create a chain that can technologically answer the questions of how you create scale with economic security. And only with that can we start to sort of begin to even ponderous how you can build applications that look better than what exists.

The Future of Applications on Blockchain

Hear, hear. Yeah, this team has been at it for quite a long time, and everybody's being super stoic, but the excitement is tangible. Let's see. Gabriel, last call for questions. Yeah, actually, I do have another question. I hope that's, I, So just going back to the point of, like, suppose that I do have some kind of. I mean, I guess this would apply just to a business as much as it would apply to, you know, some kind of activist organization that's trying to raise money with Qi.

Organizational Concerns in Using QI

But I had. How hard would it be, like, if. If, you know, the FBI leverages all of their, you know, crypto identification technology against, like, you know, I say on some sort of, like, private forum or something, you know, using anonymously, I post, like, an address where people can send their donations to, you know, my organization, which is like, you know, trying to organize for free speech when they've, like, you know, against the government in the US that, you know, dystopian is like, you know, disinformation board or whatever, you know, something like that? How, like, how hard would it be using Chi for them to identify me and.

Donation Identification Challenges

Or identify all of the people who have donated to that address? And then the same question also kind of applies also just with a business, like connecting to. You mentioned how the. I forget if it was here or somewhere else, but I believe you said that the quiet aspect of it, aside from the chi, is kind of just as, like, everything's basically totally tradable. And so if were to have a future system where, say, like, where a company, like, chipotle their entire, like, their whole stock issued on the qui network, because that's, like, where you can actually build things, then wouldn't there be a problem if people are paying them in Chi and then, you know, they're.

Connection Between Chi and Kwai

They're setting up their, like, you know, the whole financial system is on Kwai. So they have to convert their Qi over. When they make that conversion, isn't there going to be like that? Because like, as soon as they enter the quiet network, then like the quiet aspect of it, as opposed to Chi, then there would be that like loss of privacy. So I'm curious just. Yeah, yeah. No, no. So you're, you're thinking about this entirely correctly. So. So when you go from quiet to Chi, if you, depending on how you do it and when you do it's definitely lost in privacy.

Privacy Loss in Conversion

With this example of Chipotle as a publicly traded company, they're probably going to be. Did you mean from Chi to Kwai? There's a loss in privacy? Yeah, sorry. Yeah. From Chi to Kwai, there's a loss of privacy. But for a publicly traded company like Chipotle, when they're sort of reconciling the revenue in aggregate, that potentially is a very fine thing that they want to do. Now, I'll also point out, okay, let me, like, let me start at the beginning of the thread, and then we'll just pull it right on through.

Address Management and Reconciliation

So because she is fixed denominations, when you have an address, you have a collision problem and you have sort of like a syncing problem in terms of how you can register what amounts you have in the blockchain when somebody sends it to you asynchronously. So the way that you have to solve that is through something called BiP 47, which implements payment codes. So instead of actually posting a public address, what you're doing is you're posting a payment code. And what that payment code is doing is to not be complicated. Basically, I multiply your payment code with my payment code and we create a payment channel.

Implementing Payment Codes

And then when I send you money, it goes to addresses sort of in that channel. It's not a channel from the perspective of like lightning, where it isn't settled. It's just a channel in terms of the address derivation tree. So that ensures that when I send you money, I'm not sort of colliding with addresses that may be used by another set of people, which is important sort of in this fixed denomination system. So what that does is that as an organization, you could post your payment code, and people don't actually know what money is sent to that payment code unless they also have the payment code of the person sending it.

Analyzing Privacy in Payment Systems

Now in the case of Chipotle, they could use payment codes and with their internal reconciliation, they could use those payment codes to see exactly how much money was received, they could trace and try all of it. They could even reveal that to other parties if they so chose, like auditors or government entities, and that's fine, but it's optional to the recipient. So there's privacy, but there's also sort of optionally transparent, and there's optional auditability, so you can use your codes how you want to. To share with people what you want.

Business Operations and Anonymity

So sort of it comports to that concept of running a business wherein I can have sort of anonymity where I need it, maybe at the local and store levels, but I can also, at some point, reconcile it, audit it, and then roll it up into the balance sheet. Okay, interesting. Now, did you have more to add, or could I ask kind of follow up? No, go. Go for a follow up. Okay, so if. what if the, you know, what if I'm running, you know, like a, you know, activist organization or something, you know, and that for some reason, the FBI is going after.

Organizational Dilemmas

And they, what if they actually donate to that payment channel or the payment code that's multiplied? Like, would they. I mean, if they would be able. To see the payments that they've sent? The ones that they sent, but they wouldn't be able to get to see the ones that other people sent. Correct. Oh, okay. Okay, okay. Interesting. Thank you. Now, they could, like, try to do so then depending on, like, what you do as an activist organization, there's. There's.

Handling Potential Risks in Activism

There's downstream things that you could do to make sure that them sending you money doesn't sort of poison your pool that exists if you want to take that treatment. But it would be up to the user to be smart enough to do that. The user, as in the organization, that is. Yeah. So there's, like, secondary things that they would want to do to, like, they wouldn't necessarily do by default that, like, you know, if sort of they. Right. This is like a kind of like a dust attack in bitcoin in some ways.

Dust Attacks and User Vigilance

So if they don't do anything, the dust attack would work. If they have a little bit of intelligence, they could make sure that they're not, like, dosed by dusting. Okay, interesting. Okay, interesting. Great questions, like always, Gabriel. Really appreciate it. All right. I think. I think we've gone for a while now. Gabriel, do you have one more? Doctor K, you up for it? No, no, I was just saying thank you for the opportunity.

Concluding Remarks and Gratitude

I think I have asked all my questions. Yeah, I appreciate it, Gabriel, like, getting new, intelligent. We're going to turn you into a quimaxy here. Pretty quick. It's already happening. Well, go check out the light paper that just dropped today. Golden age is awesome. Awesome. Looking forward to your thoughts on that as you turn through it. I know it's not the shortest, but it's a great read. We're also looking forward to golden age getting launched here right around the corner next Tuesday.

Upcoming Developments and Summary

So keep your eyes peeled on this account, doctor K's account. And you guys should be hearing more from us soon. I think we're going to wrap it up here. What do you say, doctor K? Yeah, let's call it a night. Appreciate for everybody coming that made it through the 2 hours and looking forward to golden age. Hear, hear. Let's go. All right. Thanks, folks. Have a great night, and we'll see you all soon.