The B Word Bitcoin Conference (excerpt)
Questions on ElonsFAQ asked in this interview (1)
Transcript
0:00Elon MuskBeen thinking about money for a long time, and really it's best to think of money as an information system, primarily an information system for labor allocation. And for practical purposes, it exists in a series of heterogeneous databases, like very different databases in bank mainframes around the world.
0:22Elon MuskIt moves quite slowly. In reality, it may seem to move fast sometimes, and it does with PayPal, which is real time. But the vast majority of the systems out there are batch processing.
0:32Elon MuskSo the actual reconciliation may take one to five business days, sometimes longer. And you have the ACH system, which is ancient and still in operation, which allows transfers effectively.
0:48Elon MuskLike a check would be an ACH transfer, but it's not secure. And you've got the credit card systems, which are also. It would be like handing your username and password to a stranger in a restaurant if you buy a meal.
1:02Elon MuskSo there's definitely an opportunity for something that is better from an information theory standpoint. And there you can think of it like data on a network, I think, is the way to view it.
1:16Elon MuskWhat has the most throughput, what has the least error, what drops the fewest packets. Fraud, for example, being a source of error, and government interference in currencies being a source of error.
1:32Elon MuskBut it's fundamentally an information system. So I think it makes sense to support something that improves the quality of information with which we conduct the economy. And Bitcoin is a candidate for that?
1:49Elon MuskIt does, I think, some things well, and it's. Obviously, it's evolving. And there are additional things like lightning being done on top of Bitcoin. But Bitcoin per se is mostly solving for scarcity, or rather solving for essentially having no throat to choke.
2:13Elon MuskDecentralized. So there's no one who can be coerced in any way to empty their Bitcoin account. Well, I guess they could, technically, but on an individual basis. But the system as a whole cannot.
2:29Elon MuskAnd it has an open ledger, which is also quite good. But transaction volume is low, transaction cost is high, and usability for the average person is not yet very good.
2:46Elon MuskBut it has a lot of potential. And I should say that I'm not. I apologize for taking a long time, but there certainly is a lot to say in general.
2:54Elon MuskI'm a supporter of Bitcoin and the idea of proxy in general. But as I said publicly, we do need to watch out for crypto taking, especially Bitcoin, using proof of work to maybe use energy, that's maybe too much and not necessarily good for the environment.
3:20Elon MuskSo. But on balance, I support Bitcoin and I'm not an investor. The only publicly traded stock I own is Tesla, and the only significant thing I own outside of Tesla is my SpaceX stock that helped create both companies.
3:43Elon MuskBut apart from that, I do own Bitcoin, and Tesla owns Bitcoin, SpaceX owns Bitcoin, and I do personally own a bit of Ethereum and Dogecoin, of course.