Why Bitcoin will change everything Tom Ding, Founder

@Koinify

Me

Religion: Cryptocurrency

Founder @KoinifySr. Manager @eBay U.S. and ChinaMarketing @ Alibaba, @Trilogy

https://www.youtube.com/watch?v=Vd19SboRhVY

Part I - Bitcoin is Dollar 2.0

Bitcoin is a Digital Cash, without central authority for issuance nor exchange

Blockchain Explained

Transaction amount

Input & Output address

A unique private key controls the fund

Block 101

Block 102

Block 103

Blockchain

Public key, Private Key & Address

2^160 address space for Bitcoin

Private Key

Public Key

(SHA256)

(RIPEMD160) Bitcoin address (160 bit)

Shark attack: 2^24PowerBall: 2^28

Banking system: Centralized Ledger

Bank of America

Private Server

Hai $500

$600Yu

Decentralized Ledger

Hai $500

$600Yu

Hai $500

$600Yu

Hai $500

$600Yu

Computer NComputer 2 Computer 1

…..

Synchronize Synchronize

Double spending problem

Hai $500

$1000Amazon

Hai $500$600Yu

Hai $500

$600Yu

Computer N

Computer 2 Computer 1

…..

-$15 => $485

-$20=> $480

Solution: Proof of Work

Hai $500

$600Yu

Hai $500$600Yu

Hai $500

$600Yu

Computer 1

…..

-$20 => $480

Computer 2 Computer N

…Hashing

…

…Hashing

…

…Hashing

…

Found correct solve

Broadcast

Adopt new chain

1

2

Adopt longest chain Adopt longest chain

Quiz

❖ Explain what is a bitcoin wallet?

❖ Guess how large is the total bitcoin blockchain since genesis block in 2009?

But where does Money and Bitcoins come from?

Money = Debt = Economy Lubrication

❖ Barter

❖ Commodity money

❖ Precious metal / Gold

❖ Fiat money (11AD)

❖ 1944 - 1971: Bretton Woods agreement

❖ 1971: Nixon shock

❖ Bitcoin (2009)

Transaction cost

Standardization

Divisible

Bernanke: Let there be money

Treasury Bonds

USD

1

2+1,000,000 T-

Bills- 1,000,000 USD

Lend

3

+1,000,000 USD

+1,000,000 USD

Sad story of Zimbabwe

• First Dollar: ZWD (1980)

1.47 USD: 1 ZWD

…….

• Third Dollar

1 ZWR = 10 billion ZWN

• Fourth dollar: We’re really screwed!

A 100-trillion-dollar bill, it turns out, is worth about $5.

Worldwide inflation

Satoshi: Let there be coins

Transaction 1

Transaction 1

Transaction N

25 reward

Block 100

Transaction 1

Transaction 1

Transaction N

Block 101

25 reward

+25 Bitcoins!

+25 Bitcoins!

Max 21,000,000

…

Bitcoin Miner/Processor

Bitcoin Miner/Processor

Recap

- Money = debt

- Dollar is a product (produced by government)

- Cryptocurrency is Dollar 2.0: Solving for Principal-Agent risk

Bitcoin / Cryptocurrency

Predefined supply algorithm

Vote by money

Central Bank

- Create money

- Set interest rate & reserve requirement

- NO opt-out

VS

Quiz

❖ Assuming transaction fee is zero, Is Bitcoin transaction free? Why?

Part II - Permission less innovation & Social

contract

Innovation accelerates with decentralization

1430s:

Press

1980s:

Personal

Compute

r

1984: 3D

Printing -

manufact

uring

1989:

Web

2000s:

Blog/Twit

ter

2009 :

Bitcoin –

finance

How can cryptocurrency help?

❖ 5th protocol: Value exchange layer (e.g. Uber)

❖ Decentralized financial innovations - e.g. pool insurance

❖ MaidSafe: Decentralizing Internet

Story in Uganda

❖ https://www.youtube.com/watch?v=BrRXP1tp6Kw

- Thomas Hobbes <Social Contract>

“… that a man be willing, when others are so too, … , to lay down

this right to all things; and be contented with so much liberty

against other men as he would allow other men against himself.”

Constitution

Laws

Sovereign

Corp

Business Contracts

Non-profit LLP

Cryptocurrency enabling new org structure

❖ Why: Principal-Agent-Customer

❖ Distributed software foundations

❖ Charity / Investment Vehicle

❖ Autonomous public service

❖ Crowd Jury

Yes, it’s all happening

PayPal for Bitcoin: Coinbase

❖ One of the most popular wallet/ exchange

❖ Serving 31,000+ merchants

❖ $30m+ funding form A16Z, Union square, YCombinator, etc.

❖ Daily volume $20m +++

Derivative: ICBIT

Ethereum❖ Turing complete scripting language

❖ Contract, storage and fuel (Ether)

❖ Financial contracts, Decentralized Autonomous Organization, Voting, etc.Vitalik

Decentralizing Internet: MaidSafe

http://maidsafe.net

AWS DistributedRaised $6mil in 5hours

Most exciting crypto startup ever

❖ Traditional: Angel - VC - IPO

❖ Koinify: IPO on Day 1

❖ Coin Products:

❖ Game, Apps

❖ Financial assets

❖ Celebrity / Personal Coins

Sponsored Ads

What’s Success for Koinify

❖ US Annual Tax income: $3.3 trillion

❖ Crowdfund HyperLoop - $7 billion

❖ Government projects modularized - medical research, space projects, even university

Life: powered by blockchain

Birth StartupFinance for College IPO WillLawsuit

Powered by Blockchain

Bye

Recap – 3 layers of innovation

Money as a service: Bitcoin & Altcoins

Permission-less innovation

Social contracts: Ethereum

–Steve Jobs

“Life can be much broader once you discover …Everything around you that you call life was made up by people that were no smarter than you and you can change it, …”

Quiz / Open discussion

❖ Most exciting crypto use case for you

❖ Implications for a world with abundant currencies

Questions?

Email: tom@koinify.comTwitter: @tom_ding

WeChat: tomding1987

Koinify is hiring! www.koinify.com

CTO, Founding Engineer#full-stack #distributed#cryptography #security

We Pay cash, equity & Koins!

Sponsored Ads

Thought Experiment 2If X never invented, given X and Y, would Y be a no brainer?

Appendix: Evaluating Disruptive Technology

Often disguised as cheaper but inferior, or better but too expensive

Thought Experiment 1Assuming 100% adoption,, would it be a better world?

Thought Experiment 3: What if it becomes 100x cheaper, AND 100x faster?

Appendix: Bitcoin price

❖ Miners selling bitcoin

❖ Merchant cash out

❖ Tax

❖ Stronger regulation / Decreased liquidity

❖ User adoption growth

❖ Hoarding

❖ Fiat currency inflation / Economy conditions worsen

❖ Cross-border remittance

❖ Institutional involvement

Appendix: Further Resources

❖ Bitcoin-Dev Mailing List

❖ JayWSalon BitCoin SIG

❖ Sillicon Valley Bitcoin Meetup : Every Tue @ Plug n Play

❖ Stanford Bitcoin Meetup (Palo Alto)

❖ Ethereum Meetup

❖ SV Counterparty Meetup (In progress)