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From Bitcoin To Hedera Hashgraph Documentary Hidden Secrets Of Money Episode 8

pFrom Bitcoin To Hedera Hashgraph Documentary Hidden Secrets Of Money Episode 8 Today mankind stands at a crossroads And the path that humanity chooses may have a greater impact on our freedom and prosperity Than any event in history in 2008 a new Technology was introduced.

From Bitcoin To Hedera Hashgraph Documentary Hidden Secrets Of Money Episode 8

That is so important that hits destiny and the destiny of mankind are Inextricably interlinked, it is so powerful that if captured and controlled It could enslave all of humanity, but if allowed to remain free and flourish it could foster unimaginable levels of peace and prosperity It has the power to replace all financial systems Globally to supplant 90 of Wall Street and to provide some functions of government it has no agenda Its always fair and impartial it cannot be manipulated subverted corrupted or cheated and It inverts the power structure and places control of ones destiny in the hands of the individual in The future when we look back at the 2.6 million year timeline of human Development and the major turning points that led to modern civilization the creation of farming the domestication of animals the invention of the wheel the harnessing of electricity and the splitting of the atom The 60 year development of computers the internet and this new technology will be looked upon as a single event a Turning point that will change the course of human history Its called full consensus distributed ledger technology And so far its major use has been for crypto currencies such as Bitcoin But its potential goes far far beyond that Hi, Im here in Washington DC Across the street from the Federal Reserve because Im really excited about something We could be on the verge of a paradigm shift in Currency and trade that could put places like this the Federal Reserve and other central banks out of business in Our fourth episode of hidden secrets of money we called upon the viewers To join a discussion to develop a new world monetary system and the people that put forth the most logical and compelling Arguments where the cryptocurrency and Bitcoin people? So Im here at a massive Bitcoin conference that has drawn experts from all over the world And Im going to be hanging out with them asking a lot of questions Developing my own opinion. Id like you to develop yours because this could be something that changes the world The most common question I get lately is when are you gonna make an episode of hidden secrets of money about crypto currencies The reason this has taken so long is that I wasnt happy releasing this article until I was comfortable explaining How it works and now I finally can As I said in the intro were gonna start this journey at my first ever Bitcoin conference This was the first time I had done a deep dive into researching Bitcoin and after it finished I kept on learning and Learning some more and it actually became difficult to finish this episode because the speed at which this space is evolving But just a few weeks ago I learned about something new that could change everything and I knew we had to get this article out quickly This really is big Well learn more about this latest Breakthrough later in the article because in order to explain it we need to go right back to the beginning and learn how Bitcoin works Like most people at first I found the whole thing to be very abstract and complicated But now Ive found a way of breaking it down so that you dont have to be a rocket scientist to get it Im going to explain it by using an ancient problem that Bitcoin claims to have solved.

Its called the Byzantine generals Problem and until now its been unsolvable The problem goes like this How do you make absolutely sure that multiple entities which are separated by distance R in absolute? full agreement Before an action is taken in other words How can individual parties find a way to guarantee full consensus? Heres the example Imagine that you are a general in the Byzantine army and youre planning to attack an enemy city You have the city, surrounded by several battalions Each of them camped several miles from the other and each of them. Led by another general a Coordinated attack on the city from all sides at the same time will be successful But an uncoordinated attack will likely end in defeat you have decided to attack at dawn, but you have no walkietalkies or cell phones and Signals from flags torches, or smoke could be seen by the enemy How do you make sure with absolute certainty that all of the other generals reach? consensus and all attack together at dawn You could send messengers on horseback, but what if one of them is captured or killed before delivering the message You would need to have a reply from each of your generals confirming that they have received your message Which means that they would have to send messengers to you on horseback, but what if they are captured or killed? what if a messenger is captured by the enemy and an imposter messenger with a fake reply is sent back to you and How do the other generals know that the messages that they receive from you are genuine and havent been? intercepted and altered by the enemy Worse yet what if some of the other generals are traitors And they send messages back to you confirming that they will attack at dawn When their true intention is to retreat? How can you ever be absolutely certain that all of your battalions will reach consensus and attack simultaneously Like I said this problem has remained unsolved for thousands of years and at its core Its all about individual parties being able to trust each other directly.

No strings attached Bitcoin claims to have conquered this, bro now imagine that the battalions are actually computers on a network and that the generals are copies of a computer program running a ledger a ledger that via some very complex math Records transactions and events in the exact order that they happened The key here is that all of these Ledgers are exactly the same for every one as Soon as a change is made on one copy of a ledger if it is proven to be true by the math all Other copies of the ledger are updated to match What we have here is a distributed ledger that is also always in consensus This is one of the first things to understand about Bitcoin It is the first full consensus distributed ledger mankind has ever seen This network can be expanded across the entire planet It means that individual parties on opposite sides of the world can come to consensus on an event without requiring any third party as an intermediary for trust whether its an order from a general to his troops, or are an order from you for a pizza a Distributed ledger confirms via math whether an event is true and records it permanently Bitcoin the first full consensus distributed ledger is a trust machine But is it 100 percent reliable Thats a question for later in the episode, but for now where did Bitcoin come from and who invented it Well Bitcoin was originally developed by an a pseudo, nonnamous developer, Satoshi, Nakamoto Theres a lot of speculation about who he is and frankly I I work directly with him, but I have no idea but that never really worried me because Bitcoin itself is open source and so any engineer can evaluate the Bitcoin source code evaluate the Bitcoin cryptography and understand and trust the software So you dont have to trust who wrote it you trust the software itself and so that was one of the big reasons why Satoshi chose Opensource for Bitcoin is so you can have trust in the system. You dont have to trust who he is I dont know who Satoshi Nakamoto is I? Also, dont know who Euclid was Might have been some dude in Sicily a few years, BC But we dont really know we have some historical records that tell us that Euclid was someone who invented geometry in the ancient world but It doesnt matter Euclidean geometry works whether I know who you chlid is or not whether Euclid was a nice guy or an evil person Euclidean geometry Simply works. Its completely independent of its creator, and if we didnt know who Invented the electric motor or the radio or any of these core technology developments? electricity So what they still work? You dont have to have any appeal to Authority We dont have to worry about the motives now in a centralized system. Where someone is in control it Matters who is behind the curtains it really matters Who is in control it matters? who invented it because they remain in control or they might have a secret way of controlling it bitcoin is wide open and No, one is in control and everyone can see exactly how it works So how does it work and whats the point? crypto currencies like Bitcoin Allow people to transact with each other using the internet anywhere on earth Instead of having an account number like a checking account or a credit card Crypto currencies are much more secure because they have a public key and a private key Its like having to account numbers one for deposits and another for withdrawals Youll often see them displayed as a string of characters, or a scannable code This level of security means that you could put your public key on a billboard if you wanted to and your funds would Still be secure the only thing other people can do with your public key is send funds to you Its your private key that gives you access to your funds as long as you keep control of your private key Your funds are absolutely safe and theft and fraud are virtually impossible But just like cash in your wallet You need to keep it safe to prevent it from being stolen its security is entirely your responsibility Cryptocurrencies can also give you privacy just like cash You dont have to disclose any personal information when you spend them by contrast a credit card has your name Account number and expiration date these act like a public key But the equivalent of your private key your signature and security code are displayed in plain sight This is just plain stupid.

Ive toured five national money museums and while I was at one of them I saw a group of young students on a school outing I can just imagine that some day in the future a group of kids will be standing around the credit card display Pointing and laughing at the incredible stupidity of the system we once used and this is the point Crypto currencies are lightyears ahead of our current technology since Bitcoin was the first cryptocurrency Im going to use it as our example, and Ill expand on our earlier description of a distributed ledger But first where does Bitcoin get its value Bitcoin is brand new to mankind in that its both a currency and a payment network Simultaneously, and this is where Bitcoin gets its value the immense network of computers all around the world running the Bitcoin distributed ledger every Second of every day these computers are keeping the ledger updated and in full consensus via a system that Incentivizes them to process and confirm transactions the system that Bitcoin runs on is called blockchain Think of it as a modern version of an oldfashioned bookkeeping ledger but instead of a handwritten list of entries and calculations a blockchain is a digital list of entries and Calculations a block is simply a bundle of transactions think of a block as a whole page of transaction in the oldfashioned ledger a Blockchain is just a chain of blocks Its the same as a whole series of pages in the oldfashioned ledger easy, huh? Heres how it works the Bitcoin blockchain Actually exists in every one of the millions of computers on the network as exact copies of each other However for this example so that we can zoom in and you can really see just how a blockchain works Im going to show it as one giant blockchain in the middle of a small network of computers Lets follow a pizza transaction with Bitcoin when the transaction occurs it first appears on the network in a pool of Unconfirmed transactions along with thousands of others from all around the world millions of different computers from the network Then gather some of these transactions and place them in their own blocks the computers are all creating blocks Constantly in the hope that theirs will be the next one added to the official chain a new block is added to the chain Every ten minutes or so when one of the computers wins the right to have its block? Recognized as the next in the chain and is rewarded with a prize of newly created bitcoins The way a computer wins the prize is by trying to guess the answer to an extremely difficult math problem in Fact the problem is so difficult that even with millions of computers making guesses Billions or even trillions of times per second it still takes roughly 10 minutes to find the answer Once one of the computers guesses the correct answer and wins all of the millions of computers on the network that did not win are Instructed to throw away all the work. They have done update their Ledgers with the block from the winning computer and Start again with a new math problem in doing so the computers use an immense amount of power and cost a literal fortune to run So why do they do it because it can be very profitable This is where the term mining for bitcoins comes from instead of striking gold by mining for precious metals in the wilderness These computers are hoping to strike Bitcoin by mining precious numbers on the Chane But when these millions of computers are selecting transactions to go into their blocks They arent all selecting the same transactions and not all the blocks are the same size Some contain more transactions some contain less when blocks are thrown away the transactions they contain go back into the pool of unconfirmed Transactions this means that the probability of a transaction being confirmed and staying in the order it was confirmed in is not Absolute but it becomes more of a certainty every 10 minutes as new blocks are added in fact for very large transactions Its suggested that you wait for six or more blocks about 60 minutes to be absolutely certain that a payment is permanent so Why is it so slow? Why is your pizza cold before you own it interestingly?

The system is slowed down on purpose And heres why? With the insane difficulty of guessing the answer to the math problem you would think that the odds of two or more computers winning at the same time are Extremely improbable, but it actually happens quite often This is called a soft fork and when it occurs all the computers in the network Received both of the winning blocks and are instructed to create a new block that will chain to the block they received first But because of varying internet connection speeds different Computers receive different winning blocks at different times the tie is broken Roughly ten minutes later when one of the computers solves the new math problem And its block is added to the ledger and the longest chain wins but what happens to all of the blocks on the other side of the fork theyre discarded along with all the Transactions they contained which go back into the pool of unconfirmed transactions this soft Forking is the main reason the system must be slowed down on purpose Via the math problem if the system was instant it would be forking everywhere all the time and there would be no consensus No one would have any idea Of which ledger was the correct one and every computer would be busy building a different block to create yet another fork The slowness and immense amount of computing power is required to keep the bitcoin Ledger in full consensus Therefore as more and more computing power is added to the network the system automatically Adjusts to increase the difficulty of solving the math problem Which then requires even more power? If bitcoin is ever going to be widely used it will be using a massive amount of the worlds energy There are other systems for reaching consensus, but well look at those later in the episode For now Bitcoin is working as intended and allows people to transact with each other using the internet anywhere on earth Bitcoin its the first full consensus distributed ledger that mankind has ever seen but its not the last Im here at the conference with Eric grill of coin outlet And I am going to buy some of my very first bitcoins right now And so Erics going to show me how to do this. Hes gonna. Tell me this is a paper wallet Thats correct, so I can put I can load this paper currency.

Thats inside this little ziplock here with bitcoins, and so Im gonna take 100 bill and Hold that for a second, so what am I supposed to do with this now? Youll scan the your public address into the in there. Yes, okay, and pull it out when it beeps okay? Okay, it beeped awesome show your balance and okay, and okay And Aha, so Ive got 0.16 0 7 3 2 9 4 bitcoins, and I just finished this session, and now its sent it and its done and so basically In the blockchain the hundred dollars that I just put in Gave me that 0.16 something bitcoins in the blockchain its been assigned to my account code and Behind here I can peel this open, and theres a code that is my private key that Purchasing power is now protected in the blockchain That is mirrored around the world millions of times, so thank you very much Eric great. Thats great meeting you yeah Wonderful machine and a great advancement forward for and when it comes to convenience yes the people built it.

Theyll start understanding Cryptocurrencies more when they get an exposure thats very similar to an ATM Thats what were married. Yes. Okay. Thanks. Thank you So Ive spent a day at the conference now and I wanted to come and sort of elaborate on some of the things that Ive soaked up and I came here to Washington Circle in Washington DC Behind me as a statue of George Washington a lot of people dont know this But you know the Revolutionary War was a war fought to free themselves from regulation from government intrusion on their lives from too much taxation and The founding fathers were fighting for liberty and freedom and at the end of the war George Washington was in control of the armies of this continent and could have crowned himself Emperor But instead chose to resign his commission and retire to private life Giving us this gift of a free Republic One of the things that Im getting from this conference is that a lot of them are worried about regulation and so its this same revolution being fought all over again Theyre worried about regulation they cant actually stop transactions with crypto currencies but they could come and try and punish us afterwards and make it less likely to be used and This is a tool that could free humanity Its an amazing leap in technology and amazing leap in the potential evolution of mankind And so if this battle is lost and governments do succeed in trying to regulate The crypto currencies it would be like losing the Revolutionary War this stands for everything that the founding fathers stood for the belief in freedom liberty and the individual choice and responsibility for your own actions On day two I Listened to more of the experts and the more I learned the more I realized just how much I needed to know Even once you know all the technical details about Bitcoin.

Theres still a lot to learn about keeping your funds secure in the real world One of the most interesting things I found out is in the early days of the Internet They were actually paving the way for something like Bitcoin before they even knew what it would be So when the first web browser was built There was a 404 error page not found and theres also a 402 error Payment method not specified so back when they originally built the web browser They were thinking about the time when they would eventually Discover the technology create the technology to transfer value over the Internet they didnt have the technology back then But they still had the foresight that eventually we would get there Well now were here Bitcoin is a solution to that You guys its hard to isolate. What in particular about Bitcoin is so amazing, but Ive had to name one thing I would say was a distributed network This is kind of an amazing thing because its essentially immortal it can exist In trillions of copies all over the world what that means essentially is that it cant be destroyed I mean you could apply every regulator every bureaucrat every politician every Central banker in the world assign it to destroy the blockchain and they could spend you know 247 doing this smashing copy after copy after copy and destroy trillions of copies, but so long as theres one left somewhere and there always will be it can reproduce itself instantly and Come into existence of billions and trillions of times over again Virtually instantly what this means is that the blockchain itself is more powerful that all the governments in the world Combined many times over this is huge. Weve never had a tool this powerful to beat back the despot of the Throughout most of the convention I couldnt find anybody that shared a few of the concerns that I have about Bitcoin such as being a Deflationary currency that was until I met Chris Ellis Chris Tell me about the concerns that you have so Bitcoin right now is still an experiment as are most crypto currencies and the price is mostly supported by a Speculative sentiment and thats because markets are forward pricing mechanisms people are looking at the information And theyre buying on the basis of what they believe other people will do in the future with that information And I think that a lot of people having spoken to a lot of merchants as well They are telling me anecdotally that people are not spending their bitcoins, so I am concerned. I think the the economic Side of Bitcoin is probably The weakest, thats why we need a lot of these Alternative crypto currencies to play around with some of the parameters, but we should we should consider this an experiment for now mmhmm one of my concerns is that in a deflation velocity slows down because your currency is going to be worth more tomorrow than it is today and So people have a tendency to hoard currency in a deflation like the Great Depression for instance Bitcoin is going to have So many coins per month released, and then that level drops every is it every year or four years Until it gets to a level where it reaches 21 million coins and it stars When it stops I have two concerns One the Bitcoin mining that people are doing is what encourages Them to leave computers running all over the planet, and thats what makes Bitcoin work now I know theres a small transaction fee, and if velocity the number of transactions picks up enough Then the transaction fee is a reason to leave your computer on but you have a deflationary currency that encourages hoarding and not spending it on transactions and So when it reaches the 21 million What is the reward for leaving the Computers running if velocity? Slows and people tend to hoard it and theres no new coins to be mine Anymore so and plus the cost of power is probably going to go up in the future.

Yeah. Have you got any other concerns? Yeah, one of my concerns in this space is that there are most people here are communications and marketing theyre in the business of persuading people and I think we need more developers we need to inspire younger people there are probably fewer than a thousand people on the planet that actually know how to Code a cryptocurrency and that is a huge form of centralization they become like Congress And then we have to kind of go to them as lay people who dont know how to code and ask for changes or otherwise We end up having to fork the code and produce our own one so I still think theres a lot to do in terms of outreach getting existing programmers into the Bitcoin space onto the github Repository so they can start making their own changes and start experimenting and learning as well So what have I learned in the past few days about Bitcoin and other cryptocurrencies Ive learned that theyre a simple mathematical formula that is fair honest and impartial Ive Learned that this is more than just a digital currency I thought that this was just for sending value from one person to another This is a revolution that will change the world it will tear down borders It will connect the globe it is as important as the internet was But because it connects people because it frees people there will come a day Where there is a call to regulate it stop it shut it down possibly? The people that are calling for those things their motives need to be questioned Because what they are trying to prevent is freedom. Its that simple One of the things that cryptocurrency does is it provides freedom and the people that are will be calling for its?

Regulation or its abandonment will be the financial sector a central banks? governments because It provides for a lot of the things that government does very poorly it will do very well That the financial system currently does very poorly it will do well Its fair honest impartial instant and cannot be subverted The only caveat are that Bitcoin has first mover advantage Its the largest one, but it may not be the one that succeeds Its an experiment at this point But the important thing is that the genie is out of the bottle freedom is on its way to us right now We can all support it or we can let it languish And I think that this cannot be stopped so am I going to sell my gold and silver and convert it all to Bitcoin absolutely not Bitcoin as I said is an experiment There is a possibility that these things could go to zero before theyre fully developed Theres a possibility of some sort of catastrophic failure Right now it has proved very robust and unhackable You dont know what is going to happen in the future so one thing to keep in mind The Germans came up with the Enigma machine in World War two, and it was supposedly uncrackable And then we broke the code And then they added another dial to it to increase the complexity manyfold And it was supposed to be uncrackable and we cracked the code So bitcoin has not been completely proven Its got five years of existence now and robustness This may be the answer to all of mankinds problems when it comes to a simple medium of exchange But its more than that you can make these smart contracts that settle with with a set of rules So somebody doesnt get paid until all of the rules that you have established are fulfilled You can create escrow with yourself where theres a third party that has to sign off that a transaction has been completed Before the payment goes through theyre working on things where you can take delivery of something Continuously and pay for it as you use it It would be like paying for the internet for every second that youre using it only or paying for the gas Thats delivered to your house instead of monthly You are being billed per thermal unit and with no frictional costs involved so this adds up to efficiency Therefore mankind is left over with more prosperity if theres no third party in between bleeding off Economic energy you end up with more prosperity This is a very good thing for all of us and because it is so fair and impartial Theres less of a need for the court system. Theres less need for government, and rules and regulation and People to enforce all of this stuff in the future there will be less need for Wall Street that Wall Street Does not realize it yet? But they are antiquated dinosaurs of the past about to go extinct you can attach stocks and bonds and things such as that to Crypto currencies and companies could now do I POS just on the internet they do not need Wall Street anymore? They dont need a third party like goldman sachs or some other big brokerage house taking a cut Theres no need to worry about corruption because the code cannot be corrupted I do know that I am going to be putting some of my capital into Cryptocurrencies from now on and supporting this movement and helping to push the freedom of mankind Forward and heres something else the reason that people buy bitcoin is the same reason that people buy gold and silver Its an alternative to all of the other currencies the fiat currencies that are being printed into oblivion on this planet right now, and they eliminate the Need for a third party trust you dont have to trust somebody else with your bitcoins You only have to trust yourself.

You dont have to trust somebody else with your gold and silver you have to trust yourself So the reasons are the same and so I would encourage every precious metals investor to investigate Bitcoin and the other cryptocurrencies And I would encourage every Bitcoin and cryptocurrency User and investor to investigate precious metals, Im going to hold both I look at the crypto currencies as a very speculative volatile and Potentially risky play I look at gold and silver Just like savings. I see them as something that has never failed in 5, 000 years they are proven and I see them as extremely undervalued Compared to the morass of fiat currencies on this planet at this point So when I came here I expected to find nothing but a digital payment system and what I found is a technology that can revolutionize The planet if the founding fathers of America were standing here beside me They would be fighting for this revolution Hi, this is an action alert for July 11th 2014 I promised all of the insiders that Id keep them updated on what Im doing financially and Recently Ive done something quite unusual up until now my portfolio is entirely precious metals gold and silver physical but Ive been investigating Bitcoin quite a bit I was in Washington DC Recently at a Bitcoin conference, and I learned a lot about it. I became convinced that this has a tremendous upside potential The downside potential it would be shortterm And there is a downside risk that it could entirely fail So Im not going to put a lot of my portfolio into it but someday I will probably be up to around 10 of my portfolio going into Bitcoin believe it or not The other thing that Im doing is Im buying a bunch of Pegasus 1 ounce Rounds because theyre a bargain, and I recently cut a article about how?

One of the things I didnt get around to during the conference was talking to retailers about their experience of accepting Bitcoin as payment Id become interested in accepting Bitcoin at my own business But I still had some questions so I made a trip to Salt Lake City to see Patrick Byrne now. This is a guy Ive really got respect for because he understands monetary history economics and the frictional nature of our current monetary system and Wall Street So I know that youre in a fairly low profit margin business being an online retailer of discount goods I too, am in a very low profit margin Business youve been taking Bitcoin Youre one of the first large businesses to adopt Bitcoin the first the first large business excellent What is your recommendation for me? well We have Publicly, and you can look at our public filings our gross margins are in the high teens which is quite low For a retailer and our operating margin is A little over 1 1.2 percent and of course to take peoples credit cards Costs about 2 or 3 or 4 for most businesses if you start doing sales in Bitcoin And it saves you say 3 on your expense those those sales instead of being 1 that margin go to 4 net margin so its really especially if youre a tight margin business it makes a lot of sense to accept Bitcoin and Avoid those credit card processing fees those credit card companies and that part of the financial industry really has an amazing ability to sit on your The exchanges youre making with the public and extract theyre basically extracting the entire profit margin for themselves and Bitcoin ends that Cryptocurrency ends that so so its a frictionless system frictionless system, but you can you know the Empire is gonna strike back? No matter what theyre saying. I think the financial industry is quite. Sorry They didnt do more to put a stop to Bitcoin kill it in its cradle now that its getting some momentum.

Theyre not able to You know thats their entire business model is to extract is to be in that position where they can extract the rents through their monopoly or oligopoly and Bitcoin ends that so its really an arrow right at the heart of their business model if you dont trust the financial system anymore Theres basically two ways of checking out you can buy gold physical gold and silver and get it somewhere safe where it cant be taken from you and the other solution is to Get get into the crypto revolution Since starting this episode weve seen a blockchain boom the IPO as I mentioned are happening now but theyre actually called ICO initial coin offerings and The early nonchalance of the financial industry has been replaced by a race to develop their own blockchain payment systems Because of its rate of growth Bitcoin has been stressed to the limits where it was once fast and cheap it is now Slow and expensive in fact the issues Bitcoin has suffered from have led to political infighting Bitcoin forking into multiple versions and alternative cryptocurrencies gaining market share every day Distributed ledger technology has caught fire And theres a speculative mania occurring while the speculation cant go on forever one thing is for sure Blockchain is here to stay or is it? Last week I was in New York City For a meeting that we had scheduled that I thought was going to take a couple of days And it ended up only taking a couple of hours so with all the leftover time I decided to go visit an old friend Demetri Covinas he used to have a one of the best financial shows on television called capital account you might remember him from Episode two of hidden secrets of money where he talked about Greece and the hubris of leaders and empires and how history repeats Anyway, he has a new podcast called hidden forces and when we visited him He was all fired up about this new technology and this podcast you know when I listened to it I got all fired up and he invited us to attend an event so we went home to Los Angeles There for two days and right back to New York again and to the event that he hosted about Hash Graff technology created by Leland Baird that is Probably going to end up replacing blockchain technology I mean This is big. We went to the event we listened to some of the people that are involved with this And we were just absolutely blown away So Im going back To visit with Demetri now and get his take on how the event went last night and where the future of this thing is going Since the advent of Bitcoin there have been many thousands of blockchain based crypto currencies created And now there are more of them being created every single day So whats different about hash graph well it isnt blockchain. Its totally different in fact the way It works is a real Mindbender and not very easy for me to explain that Im gonna give it a try instead of a block in a blockchain Hash graph calls their packages of information Events your computer takes a transaction like a payment or anything else for that matter such as an action in a articlegame an offer to sell merchandise or even sell stocks or bonds a bid on that item a contract or even a law pretty much any Information or transaction you want to record and it puts it in the event for transmitting information quickly hash graph uses a Technology that has been the gold standard in computer science for decades its super fast and its called gossip protocol Your computer randomly tells another computer in the network About the event youve created and that Computer responds by telling your computer about any events it heard about then that computer tells another Computer about your event and the other events it heard about and the computer Its talking to responds by telling all the events it knows about its absolutely the best most efficient way to spread Information, and its exponentially fast But heres the twist Each time a computer tells another computer about an event it also includes the information of the time it heard it And who had heard it from and the time they heard it And who they heard it from and so on and so on its called gossip about gossip And it lets everyone know what everyone else knows and exactly when they knew it in just fractions of a second The other major component is an even older technology And its the most robust secure and certain way of coming to absolute consensus Its called voting protocol, but until now It was so slow that nobody ever used it and the twist that hash graph has given.

It is that theres no voting Instead because everyone already knows what everyone else knows you can mathematically Calculate with 100 certainty how they would vote its virtual voting and it allows hash graph to come to consensus almost instantly So instead of recording things on a block and then adding it to the blockchain once every 10 minutes Hash graph events are added to the system instantly the moment theyre created so they dont have ten minutes worth of Information in them this means that theyre small and they contain far less data so they use very little bandwidth and are much easier to transmit and because its not trying to guess the answer to an incredibly complex math problem trillions of times per second hash graph uses just a Miniscule amount of power from what Ive seen so far Compared to blockchain hash graph is lightningfast more secure and provably fair all events are timestamped the moment Theyre woven into the system so the record of whose event came first in whos came second is instant and theres no such thing as soft forking or Unconfirmed events it can also replace huge portions of the internet that are currently run by Centralized servers by replacing them with the shared computing power of all of our own computers iPads and cell phones It looks like hash graph might just have the potential of fulfilling all the original hopes and dreams I had for blockchain technology the power to decentralize and remove the middlemen from commerce banking stock markets and much of the legal system and government with the speed at which this Technology is evolving the future is looking bright and hash graph is the perfect example of just how fast things are moving in this field Well I think the really amazing innovation that Leemon has made is in the way in which he has made adjustments to the gossip protocol And to the voting system in order to make them compatible at scale right because a voting algorithm can work And you can reach consensus in the in the exact same way but in order to Deploy that in the real world the bandwidth constraints on it would be such that youd never actually be able to practically use it But by incorporating the gossip protocol and creating the hash graph And then being able to use that in conjunction with the local data that you have in memory and running a voting algorithm locally on the computer without having to cast any votes or send any votes over the Youre actually able to get all those strong guarantees that you get with a voting algorithm But youre able to do it at scale and thats whats so remarkable and to be quite honest. Its its hard to imagine How no one thought of it its one of those brilliant ideas that you could have only Looked in retrospect and said how did no one think of this but at the time No one did so one of the challenges I think with any new technology like this is how do you really explain to people? How do you make a compelling case for what makes a technology so compelling right and? One of the things thats so compelling about this technology is the throughput its the speed And its its you know you can tell people that theyve tested over 300, 000 minimum tested Transactions per second versus bitcoins three to seven max, but like how do you kind of get that in your head?

And I sort of did a backoftheenvelope calculation and thats roughly twice the speed of sound relative to a snails pace Bitcoin being a snails pace and This network literally being like a supersonic jet traveling at twice the speed of sound Which is I mean just wrap your head around that for a second? Its its remarkable Its not even like within so you can see the difference Its tremendous and understanding of course that the speed of the network The reason why bitcoin is so slow is because they have to make it slow because if its not slow it would fall apart it Would branch off everywhere you would never have consensus now remember the explanation of the Byzantine generals problem from earlier And how blockchain was built to solve it? Heres something not many people know blockchain systems arent Technically Byzantine fault tolerant they came close, but no cigar So I like many people assume that block chain was Byzantine fault tolerant and in fact I didnt fully appreciate what that even meant I sort of just assumed it and because I saw it as a sort of part of the larger picture of Blockchain being very secure and not having been hacked but in fact it isnt Byzantine fault tolerant and the reason why its not Byzantine is Because in order to be Byzantine you have there has to become a point in time when youve reached consensus You know youve reached consensus, and you know youll never be wrong and youre never going to change your mind And that doesnt happen with blockchain because the nature of the network the the geometrical qualities of the blockchain network require you to always sort of Recognize that youre never entirely sure your probabilistically more confident that youre arriving at consensus But thats also why on the blockchain network.

From Bitcoin To Hedera Hashgraph Documentary Hidden Secrets Of Money Episode 8

You need to keep a entire history of the ledger because you sort of have to have the capacity to do a Forensic analysis in the event that you are mistaken in the event that the network has fork Then you dont know it And so thats something that you dont have to do with hash graph because with hash graph Your your comb coming to consensus every few seconds And you can dump the entire history of the networks data and just keep rolling forward because youre absolutely sure that you reached Consensus and thats the difference. I think the major problem the sort of the big deal in the blockchain community for years ever since The community figured out that they could take this protocol that bitcoin was built on and sort of extrapolate it and use it to build these distributed Systems this distributed architecture around storage and computation etc and building applications on top of it is that theres there was a recognition that it was that it had limitations it had limitations at scale and the communitys been trying to figure out how to address that while at the same time building apps on top of it and Something that LeMans said which really has stuck with me is that while everyone was really busy Building apps they forgot about what the core of distributed technology is all about which is reaching consensus And what hash graph has done is it has revolutionized that process we can agree about the things that were communicating about at Scale and thats a revolution. Its the biggest revolution since the web Right and you were just following your heart to do it. Oh, thanks the thing it wasnt right So weve been looking at this amazing new technology for about a week now and what I find so Incredibly amazing is that it holds the promise to solve all of the problems that the other distributed ledger distributed network ledger systems have Bitcoin once it started to scale up it turned out that it used an immense amount of energy to run the system and Also as it scaled up it became slower and slower and slower to where it was no longer at currency It was basically a speculative Vehicle you people could make some gains in purchasing power on it but it wasnt something that you could stand in line at a Starbucks and pay for a cup of coffee for a Friend of mine just did a transaction that took four hours for confirmation and so this is incredibly fast pretty much Instantaneous the number of transactions that it can process per second is mindboggling compared to Bitcoin And it uses almost no power, so it solves all of the issues that I had with Bitcoin theres a lot of different crypto currencies now and many of them are engineered to either be faster or to be more sound and Robust, but everything has a set of tradeoff And so whatever feature that they want to offer they have to give up something else so the really fast ones if they Want them to still be fast once theyre scaled up?

Theyre More vulnerable to some sort of attack or hacking The ones that are less vulnerable to attack and hacking have the problem of scaling theyre going to be slow So you know speed fairness where the transactions are recorded in the absolute order that they came in some cryptocurrencies offer you the ability to pay extra to have your transaction mine first and that really isnt fair a Distributed ledger should be recording everything at the absolute time of event and then full consensus is reached and theres no argument No going back This is set in stone for ever So now were actually on our way to talk to some of the team at hash graf and learn more about this When I first arrived I was chatting with some of the hash graph team about how much energy the Bitcoin system uses these days it has literally gone through the roof if Bitcoin were to replace the entire world monetary system and financial markets it would use more power than the entire world produces its completely unsustainable This is one of the reasons. Im interested in hash graph Its amazing efficiency the other reason these guys already have commercial customers using their technology at an industrial scale How its being used today is in private enterprises? Its been deployed by the Credit union Association where Cu ledger is a group of 6, 000 credit unions and a consortium that had to make a decision what distributed ledger Technology were theyre going to use it and we beat IBM hyper ledger, and were super proud of that its were a small company no more than six people today and The fact that we could go up against IBM. Its a true David and Goliath story, and were really proud of that its also being used in aetherium based projects where a lot of these ico coin offerings are starting to realize the limitations of the etherium protocol in that today Its five to seven transactions per second Hash graph is again that hundreds of thousands of transactions per second Which opens up a whole new genre of applications that could never run on aetherium our technology speaks for itself Its night and day in true comparison to everything else in the market and everything falls short Especially when it comes to security were asynchronous Byzantine fault tolerant.

Were the strongest form of security you can get in a distributed architecture You dont have to take our word for that. Theres 30 years of academic literature on in the space of voting based systems Ours is a voting based system without the voting we do virtual voting which sounds weird, but it works. Its peerreviewed Mathematically proven, thats what got the credit unions the fact that We have absolutes certainty that when we achieve consensus. This is consensus Its not its not blockchain in that with every additional confirmation We become a little more certain, but were never truly certain and thats the case certainly of blockchain with hash graph you never have that what if Youre a hundred percent certain that this is the way things are this isnt theoretical Were not talking about a white paper or some voodoo idea that is Is not practical because the fact of the matter is this is a tech stack that you can go download today Its been out for a while now We took it to TechCrunch Disrupt to have developers and the hackathon out there build on it We gave a 5, 000 prize to a team that built up the hash graph fair auction ledger and what that is is a distributed auction for the first time ever in the history of mankind where there is no centralized infrastructure, but Distributed parties could submit a bid and we can still decide who won that auction think Sothebys or eBay But without a leader without any vulnerability and with complete fairness, thats never existed before Well for me the most exciting Applications or potential applications for hash graph are in in terms of Internet of Things in terms of identity and In allowing us to be able to control our own identity instead of it being in the hands of corporations or other organizations from our currency or economic standpoint It opens up possibilities in in developing countries You know theres so many possibilities that before hash graph got invented. You know all these possibilities didnt exist, but now they do It really does seem like hash graph has cracked the problem of consensus at scale once again You can see the speed of evolution in this space right in front of your eyes and like I said in Washington DC It may not be Bitcoin that dominates this space it may not be aetherium it may not be hash graph But you need to understand how quickly this thing is moving.

Its a very exciting time The more I found out about this technology the more, I needed to know about it So I headed straight to Texas to meet with lemon Baird hash graft CEO mance Harmon We we both lived in the same town It was actually a suburb of Austin, Texas, Cedar Park, Texas And there is a Starbucks on the corner we would meet there after Kids have gone to bed and would sit at the Starbucks until they would close and very often Until late in the evening after theyve closed we would often watch the people at Starbucks Bag up all the trash and throw it over into the dumpster and leave it And I would be sitting there talking about The latest thought and in the latest evolution of the hash graph that you know whats the latest rabbit hole that? Leeman was going down in terms of exploration of how to solve this problem And so there are great many memories of this process in that particular location Its clearly the case that were wanting to change the face of the internet Were wanting to make the internet what it should have been from the beginning But nobody stopped to figure out Whats the right way to do this and the internet grew up in such a way that there are serious? Architectural flaws and security flaws and and theres a lack of trust at a very real sense And we see the opportunity to fix that problem And theres a general understanding across the community that what were doing today in the world of distributed consensus is sort of equivalent in many ways to what happened in the mid90s with the introduction of the World Wide Web and how that changed Society and fundamental And and so were not alone in this its obvious to the community We just happen to have the best technology in the market at the right moment in time And so weve been given this privilege of being able to be on the leading edge and and perhaps uh sure in this new trust layer on top of the existing Internet and Theres a certain camaraderie that comes along with wanting to Do so your to do something as as bold as say were going to change the internet So its funny the ledger field is very broad and people come to it from different directions some people thirty years ago Were coming to it from making computers not have faults but theyre also concerned about how to Create cryptocurrencies or how to create smart contracts or how to create? Short stared in short information or how to do databases the database world has been doing this for decades my My interest was slightly different What I wanted to do was to enable collaboration My goal is that we should have anyone on earth at any moment can just wave their hand and carve out a chunk of cyberspace Carve out a world of their own without having to pay anything for free create a court world of their own and invite some friends And now we have a shared world Anybody should be able to create this shared world and in this shared world you and I should be able to create Documents and create movies and create 3d objects and we should be able to collaborate with each other and talk to each other We should be able to interact in ways where Im not the dictator of the whole world.

I cant delete everything arbitrarily We should have rules enforced So maybe its a fair world where I cant delete things you create or maybe its a fair world where we vote on things Or maybe its a world in which We have a stock market And you can make sure that the first bid gets matched up with the first acts not the later ones We wont have a world that you and I can trust and that our friends that we have invited and maybe the strangers we have Invited can trust is going to work the way we want And we can trust that if my computer dies and is erased I can get all the data back the data will never disappear But to do it totally for free No server involved just the computer the people involved with complete trust without having to trust any one person in any way and Be able to have this shared world that has the fairness and then the speed I mean I wanna be able to play gains in this world So I want a ledger where Im recording every single time a person moves or shoots or pick something up you want to be able to do a game and Were talking hundreds of thousands of transactions per second, maybe we want huge speed and we want complete security We want privacy we want no one is spying on us this isnt funded by advertisements you want to spy on me So I have better advertisements we want it just to be something that appears out of nothing Thats just living on our computers And then when were able to have a shared world we want to have multiple shared worlds that connect to each other So maybe you and I and a few friends set up a little stock market just for ourselves to send things back and forth The banks do this theyre called dark pools. Its like a little tiny stock market just for a few players that Trust each other sort of but not entirely. I dont entirely trust you and have even the problems with dark pools where maybe Banks are taking advantage of some of the information involved, maybe one banks hosting the server But they can manipulate the timing a little bit, and we have to worry about this I dont want that I want a completely trustworthy stock market that maybe you and I in a few banks set up But then I want to have a different sort stored world that maybe keeps track of a cryptocurrency And I want them to be able to link so that that cryptocurrency is used to buy and sell our stocks.

I Want to be able to have a game world that links to a Wikipedia? World where it appears that pieces of Wikipedia are actually part of our world and as they change in the Wikipedia world they change in Our world you want to have shared worlds that are internet interlocking with each other that allow shared trust even across these things This is the vision for what we want The internet to be it will change the way we even look at what? Cyberspace is what the Internet is what our networks. Even what our computers? This is whats going to happen and 20 years from now when The children who are born, then are growing up.

Theyre not even going to think about websites and Emails as a separate thing and Internet and many of the hacking attack that we have today Theyre just gonna take it as a matter of course that any time. I wont talk and wave my hands I get a shared world. Its free Its easy its trustworthy and reliable I can invite two friends or a million friends and it all just works And it will change the way we think of what the Internet is That is what I? started being interested in building and This is the direction that were going this is what distributed Ledgers do is They will ultimately allow us to do that and theres a lot of rough edges is we have growing pains and distributed ledger technology today but well get over the growing pains we will get to a world that really is fast and secure and fair and We will enable to then have this vision of shared worlds big public ones little private ones everything connected That was the idea that was five years ago so I like playing with math so I kept playing around with how would you do it, and I convinced myself?

Yeah, its impossible. You cant do that. Theres no way that you can have really high throughput because and And also have all these security and fairness properties You just cant do it because ultimately you end up having to tell everybody what you think and then telling people what other people thought And they you can have millions or billions of extra votes and receipts on votes floating around and just doesnt work so I was able to convince myself. Its not possible And I set it aside And it would come back and haunt me, and it would keep nagging at me, and so I would pick it up again And I would spend a couple of days going through it and going through the math and realizing No, I was right.

It really is impossible You cant do that and set it aside again, and this kept going for years I have lots of math problems some Ive been working on for decades they just for whatever reason I dont know why they just latch on to me, and I cant get away from them and eventually I said Wait a second if were all just talking to each other and you include a tiny bit of extra information We could each end up with a complete history of exactly how we talked to each other in what order? But if I had that I would know exactly how information flowed through our community I would know what you know I would know when you learned it I would know what you know about what Alice knows and what you know about what Alice knows about what Bob knows and about when? They learned it. I would know so much that I could take one of those huge impractical impossible to slow voting algorithms and do it with no votes at all I Could just sit here and say oh, I know how you would vote so dont bother voting dont tell me your vote I know it.

Ill just pretend that you voted and Ill just pretend and Ill just get to the conclusion and So all we do is we just talk to e we talk anyway to send out our transactions We had a tiny bit of information and it gives us this entire history the history is called a hash graph You just get this entire hash graph that lets you see such incredible amounts of information about who knows what when That then you get consensus for free But thats where were going and where were at the very early stages I mean the planet is at the early stages of what Ledgers can do and I think whatever you think that Ledgers might be able to do they can do that But they can also do more and we are just as as a as a species beginning to learn what the final limits are and were pushing as fast as we can along that path and so this is the Gateway to the next net this is it this is the next note Technically the geeks will always know well. Theres multiple layers, and the Internets still down there at the bottom Just like it always has been but for the users What they think of when they think in their mind of what the net is is changing and thats whats going to be different and a low energy cost ah Lets talk about energy cost you can run this on your cell phone Am I correct the processor and a cell phone apps is enough to actually run absolutely hash graph absolutely so There are systems that would require you to buy a supercomputer. Its called a mining rig Its a big box full of specially built chips that dont do anything useful humanity They just mind which means they solve math problems that have no inherent use The purpose of them is to slow down the network This isnt this isnt sound good Just on the face of it.

Im going to spend a lot of money on a supercomputer and then Im going to Use a lot of electricity to run my supercomputer and the whole point of the supercomputer is to slow down the network But thats what it is and so proof of work systems work that way Proof of work is really exciting because it was the first to show us all the possibilities of Ledgers But its the first generation. Were clearly need to move beyond that and we will I think over time So with hash breath yeah, you could run a full note on your cell phone Youve accomplished something a tool that is extremely powerful. What are your hopes and dreams?

My hope and dream is that this pushes us forward along this path to an Internet of shared worlds like weve been talking about Where anybody can collaborate with anybody and? The data is stored You dont have to pay for a server to hold it it is secure. It is private where you have the rules enforced We could set up an organization and trust that elections arent being rigged Because the rules are enforced you dont have to trust any one Person we could have money and trust that no ones going to inflate the money supply because the rules are enforced and it is Guaranteed we could store The deed to your house and at any given moment I could know that were all seeing the same answer as to who owns it So that you cant sell it to one person and also sell it to someone else at the same time youll get caught because its a publicly visible thing that everyone knows that everyone else is seeing the same thing I I vision a world where the whole internet works this way or we all know that we can all see the same thing and that rules are enforced that we have collaboration and To do that we need speed we need security we need fairness And I my goal is that what were doing? Pushes us along that path because thats the goal that we need to get to where the nature of the Internet itself is Different because it has a trust layer So this has been my threeyear journey of discovery from Bitcoin to hash graph and all the promise that they contain Now when we make a documentary like this You shoot hours and hours and hours of film and you have to decide what to put in and what to leave out? many of these guests we interviewed for somewhere between a half an hour to more than two hours and they said amazing things and stuff that you really do want to learn and So were going to make all of this available as bonus footage on hidden secrets of money Dotcom and so go there if youre interested in any of this, but especially hash graph You know we wanted to take you on this journey of discovery to show you these stepping stones along the way and My hopes and dreams when I first started on this journey Was that Bitcoin was going to be the technology that was going to help free the world to make a fairer more prosperous freer planet for all of us by helping to change the monetary system and it has Bitcoin is Extremely important, its like the very first automobile Its like the discovery of Electricity its like figuring out how to harness fire Its its a very very important technology, but no man can Design something that is supposed to be a freemarket interaction and predict all of the unintended consequences, and what satoshi nakamoto has done here is beautiful except when he did it figuring out how to Incentivize people he over Incentivized the mining area and what has happened to Bitcoin is it has become this behemoth That is no longer the promise of a currency Its not going to replace the world monetary system or the financial markets nobody is actually using it for transactions theyre using it as a speculation now and So it isnt living up to the original promise of what bitcoin was supposed to be Hash graph might we have yet to see right now none of the blockchain technologies that I know of can run markets where its got to be absolutely instant and Absolutely fair hash graph can provide these things you know The people on Wall Street were sort of like dinosaurs looking up at an asteroid and not realizing What was coming suddenly? everybody in the financial sector is scrambling to try and figure out how they can get a cut of this and One of the things a lot of the Wall Street people dont realize yet, is that a lot of them are already obsolete now hash graph Because its plant patented. Theres theres no token that you can buy right now theres Its a platform.

Its just like the blockchain. Its its something that underlies Applications that will be built on top of it so but this The part that underlies those applications. This is a Revolutionary trust layer that speeds everything up Conserves energy and turns the Internet into something completely different because its completely decentralized As far as government in the financial system We have seen a tremendous change since the founding of the United States of America It was founded on freedom and what weve seen is more and more controlled by government and the financial system inserting themselves more and more and more between Individuals that want to transact with one another now the powers that be are not going to want to go down without a fight and this does have a potential to supplant most of what they do to take away much of the power and Thats really what I would like to see and so this is my great hope and dream, but were not out of the woods yet, we have to keep pushing this forward and Please support it.

This is something that Everybody should get involved with and everybody should spread the news on it if you want it to succeed just like the beginning of this episode These technologies really do have the power to enslave or free mankind Its going to be one or the other there is no middle ground here and right now We have the opportunity to choose. This is a decisive moment in history the future of mankind Depends on what you do so learn as much as you can about this space all of it Visit hidden secrets of money comm and watch the bonus features especially the stuff from Lehmann Baird at hash Graph share this article with Everybody that you can and until next time. Thank you very much for watching good luck, and well see you next time but theyre actually called ICO initial coin offerings andp

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