Transcript: The Next Digital Revolution | Jan 09, 2017

Steve sits in the studio. He's slim, clean-shaven, in his fifties, with short curly brown hair. He's wearing a gray suit, pink shirt, and striped purple tie.

A caption on screen reads "The next digital revolution. @spaikin, @theagenda."

Steve says THIS PAST AUGUST, THE
WORLD ECONOMIC FORUM RELEASED A
REPORT ARGUING THAT BLOCKCHAIN
TECHNOLOGY WILL BECOME THE
"BEATING HEART" OF THE GLOBAL
FINANCIAL SYSTEM.
WHAT IS IT AND HOW FAR-REACHING
MIGHT ITS AFFECTS BE?
LET'S ASK:
DON TAPSCOTT, AUTHOR AND DIGITAL STRATEGIST...

Don is in his sixties, clean-shaven, with receding gray hair. He's wearing a gray suit, blue shirt, and checkered blue tie.

Steve continues AND HIS SON, ALEX TAPSCOTT...

Alex is in his thirties, clean-shaven, with short side-parted brown hair. He's wearing a brown suit, blue shirt, and purple tie.

Steve continues WHO TOGETHER HAVE
AUTHORED THE NEW BOOK,
"BLOCKCHAIN REVOLUTION: HOW THE
TECHNOLOGY BEHIND BITCOIN IS
CHANGING MONEY, BUSINESS, AND THE WORLD."

A picture of the book appears briefly on screen. The cover is white, with drawings of small colourful blocks.

Steve continues WE WELCOME THIS DYNAMIC
FATHER-SON COMBO BACK HERE TO
TVO.
YOU'VE BEEN HERE BEFORE.
NICE TO MEET YOU FOR THE FIRST
TIME.

Alex says NICE TO MEET YOU TOO.

Steve says WE MENTIONED THE
WORLD ECONOMIC FORUM.
I WANT TO QUOTE A PASSAGE FROM
THEIR REPORT ON THE FUTURE OF
ECONOMIC INFRASTRUCTURE.
SHELDON, IF YOU WOULD, PLEASE.

A quote appears on screen, under the title "Changing the global financial system." The quote reads "Blockchain could redraw the structure of financial institutions and the back-end of services as we know them today. Blockchain could allow consumers to pay less for all kinds of financial activity, from international payments to the trading of stocks and bonds. It could also give regulators new capabilities, allowing them to stop regulatory violations before they start and to watch more effectively for warning signs of financial crises."
Quoted from the World Economic Forum. The future of financial infrastructure. August 12, 2016.

Steve says OKAY.
THAT ALL SOUNDS PRETTY
IMPRESSIVE, BUT FIRST OF ALL, WE
HAVE TO FIND OUT WHAT THIS ALL IS.
SO, DON, BLOCKCHAIN TECHNOLOGY IS WHAT?

The caption changes to "Don Tapscott. Co-Author, 'Blockchain revolution.'"
Then, it changes again to "A digital ledger."

Don says WELL, IT'S
KIND OF INTERESTING.
YOU WENT TO THE WORLD ECONOMIC
FORUM BECAUSE ALEX WAS JUST
THERE.
HE FLEW IN LAST NIGHT.
AND I'M ALSO AN ADVISOR TO THE
FORUM AND WE'RE VERY MUCH
INVOLVED IN THEIR INITIATIVES.
LET ME WIND BACK A LITTLE BIT.
WE'VE HAD THE INTERNET OF
INFORMATION FOR DECADES.
AND WHEN I SEND YOU SOME
INFORMATION, I'M ACTUALLY
SENDING YOU A COPY.
I KEEP THE ORIGINAL, THE PDF OR
eMAIL OR EVEN A WEBSITE.
THAT'S GREAT.
BUT WHEN IT COMES TO THINGS THAT
MAKE THE ECONOMY WORK, ASSETS,
THINGS OF VALUE LIKE MONEY AND
STOCKS AND BONDS AND
INTELLECTUAL PROPERTY AND EVEN
ART AND MUSIC AND VOTES AND
ENERGY AND OUR IDENTITIES AND SO
ON, SENDING A COPY IS A TERRIBLE
IDEA.
IF I SEND YOU 100 dollars, IT'S REALLY
IMPORTANT I DON'T STILL HAVE THE
MONEY AND I CAN'T SEND IT TO
ALEX BECAUSE I OWE HIM A
HUNDRED.
OR TO SOMEBODY ELSE.
THIS HAS BEEN CALLED THE DOUBLE
SPEND PROBLEM FOR A LONG TIME.
AND THE WAY WE MANAGE THIS IN
OUR ECONOMY IS THROUGH BIG
INTERMEDIARIES.
NOW FOR THE FIRST TIME EVER, WE
HAVE A GLOBAL DISTRIBUTED LEDGER
WHERE ANYTHING OF VALUE, FROM
MONEY TO VOTES TO MUSIC, CAN BE
STORED, MANAGED, AND EXCHANGED
PEER TO PEER WITHOUT A POWERFUL
INTERMEDIARY.

Steve says PLAY THAT FORWARD.
HOW DOES THAT ACTUALLY WORK?

The caption changes to "Alex Tapscott. Co-Author, 'Blockchain revolution.'"

Alex says WELL, I
THINK WHAT DON'S DESCRIBING IS
AN EVOLUTION BASICALLY FROM AN
INTERNET OF INFORMATION TO AN
INTERNET OF VALUE, AND WHAT'S
REALLY FASCINATING ABOUT THIS
SECOND GENERATION OF THE
INTERNET IS THAT IT'S LIKELY TO
HAVE, IF NOT AS GREAT, PERHAPS
AN EVEN GREATER IMPACT ON THE
WORLD OF BUSINESS AND ON OUR
INSTITUTIONS.
SO YOU POINT OUT FINANCIAL
SERVICES.
AND THAT'S AN AREA WHERE A LOT
OF PEOPLE WHO HAVE BEEN WRITING
AND TALKING ABOUT THIS HAVE
POINTED TO FIRST.
TO BE SURE, THE INDUSTRY WILL BE
TRANSFORMED, FUNDAMENTALLY.
I'D SAY IT WILL BE PRACTICALLY
UNRECOGNIZABLE IN 5 YEARS.
BUT FINANCIAL SERVICES IS JUST
THE START.
OTHER INDUSTRIES LIKE CREATIVE
INDUSTRIES... MUSIC, FILM, ART,
JOURNALISM... COULD ALSO BE
TRANSFORMED.
LET'S TAKE MUSIC AS AN EXAMPLE.
IN THE MUSIC INDUSTRY TODAY,
ARTISTS DON'T REALLY GET THAT
GREAT OF A DEAL.
IN FACT, SOME LOOK BACK AT THE
'50s AND '60s AS THE GOLDEN
AGE, WHICH IS PRETTY SAD BECAUSE
BACK THEN THEY ALSO GOT A
TERRIBLE DEAL.
TODAY, THOUGH, IF AN ARTIST HAS
A SONG AND IT PLAYS ON SPOTIFY
AND IT GETS A MILLION STREAMS,
THEY'RE NOT MAKING AS MUCH MONEY
AS THEY DID IN THE OLD DAYS.
IN THE OLD DAYS IF A SONG WAS
PURCHASED A MILLION TIMES,
THEY'D MAKE 45,000 dollars IF THEY WERE
THE WRITER ON THAT SONG.
TODAY THEY WOULD MAKE 36 dollars.

Steve says PERIOD, FULL STOP.

Alex says PERIOD, FULL STOP.
THAT'S AN UNSUSTAINABLE MODEL.
THE CREATORS OF CONTENT ARE NOT
GETTING FAIRLY COMPENSATED FOR
THE VALUE THAT THEY CREATE.
THAT'S PROBLEMATIC BECAUSE IT
COULD IMPERIL THE ENTIRE MUSIC
INDUSTRY.
WHAT DOES BLOCKCHAIN HAVE TO DO
WITH THAT?
THERE ARE COMPANIES TODAY THAT
ARE WORKING WITH THIS TECHNOLOGY
TO PROGRAM INTELLIGENCE INTO
MUSIC.
YOU KNOW, MUSIC IS ALREADY
DIGITAL, BUT IT'S ALWAYS BEEN
TREATED AS INFORMATION.
AND THE INTERNET HAS BASICALLY
PUSHED IT THROUGH THIS PRINTING
PRESS THAT'S MADE IT A FREE
COMMODITY.
WITH BLOCKCHAIN WE CAN TAKE
MUSIC AND TURN IT BACK INTO A
DIGITAL ASSET.
EVERY TIME A SONG IS CONSUMED,
IT WILL TRIGGER WHAT'S CALLED A
SMART CONTRACT, WHICH IS
BASICALLY WHAT IT SOUNDS LIKE,
IT'S PROGRAMMING THE IMAGE WITH
GUARANTEED EXECUTION,
ENFORCEMENT, AND PAYMENT.
YOU WANT TO PLAY THAT SONG ON
THE RADIO, YOU WANT TO STREAM
IT, YOU WANT TO BUY IT, YOU WANT
TO SAMPLE IT FOR A MOVIE OR T.V.
SHOW, YOU WANT TO USE THE DRUM
TRACK FOR ANOTHER PIECE OF
MUSIC, THAT WILL TRIGGER A
CONTRACT WHICH WILL ENSURE A
PAYMENT GOES DIRECTLY TO THE
CREATOR OF CONTENT.

Steve says ALL AUTOMATIC.

Alex says ALL AUTOMATICALLY.
TODAY WHAT HAPPENS IS ARTISTS
GET PAID LESS, IF THEY GET PAID
AT ALL.
THEY'RE USUALLY THE 10TH IN LINE
AFTER FINANCIAL INTERMEDIARIES,
LABELS, PERFORMING RIGHTS
ORGANIZATIONS AND A WHOLE BUNCH
OF OTHER THIRD PARTIES WHO GET
PAID FIRST, AND SOMETIMES THEY
MISS GETTING PAID, PERIOD.
SO THIS WOULD BASICALLY TURN
THAT PARADIGM ON ITS HEAD WHERE
ARTISTS WOULD GET FED FIRST AND
FAIRLY AND THEY WOULD DECIDE
WHETHER OR NOT ALL THOSE OTHER
GROUPS ACTUALLY ADDED VALUE.

Steve says SO WE DON'T HAVE TO
TRUST ANYBODY ANYMORE TO MAKE
THIS HAPPEN, RIGHT?
IT'S ALL GOING TO BE PEER TO
PEER IN THE FUTURE; IS THAT RIGHT?

The caption changes to "The trust protocol."

Don says WELL, TRUST
IS ACTUALLY BUILT INTO THE
PLATFORM.
TODAY, TO DO ALL THIS BUSINESS
IN THE ECONOMY, WE HAVE TO COUNT
ON BIG BANKS, GOVERNMENTS,
CREDIT CARD COMPANIES, BIG
SOCIAL MEDIA COMPANIES, AND THEY
ENABLE US TO TRUST EACH OTHER.
THEY IDENTIFY WHO WE ARE.
THEY DO THE CLEARING AND
SETTLING OF TRANSACTIONS.
THEY KEEP RECORDS.
AND OVERALL THEY ENABLE US TO
WORK TOGETHER.
BUT WITH THIS NEW BLOCKCHAIN, A
GLOBAL DISTRIBUTED LEDGER, WE
CAN ALL DO THESE TRANSACTIONS,
AND TRUST IS NOT ESTABLISHED BY
BIG INSTITUTIONS, IT'S
ESTABLISHED BY CRYPTOGRAPHY,
COLLABORATION, AND CLEVER CODE.
THAT'S WHY WE CALL IT THE TRUST
PROTOCOL.
BECAUSE TRUST IS GENERIC.
IT'S PART OF THE PLATFORM.

Steve says LET'S PICK UP ON THE
FINANCIAL SERVICES ANGLE THAT
YOU JUST MENTIONED.
THE IMPLICATIONS OF THIS ARE
ABSOLUTELY ASTONISHING BECAUSE
RIGHT NOW THE CITY THAT WE'RE
SITTING IN RIGHT NOW, TORONTO,
ONTARIO, CANADA, ITS FINANCIAL
DISTRICT WITH ALL OF THOSE
SKYSCRAPERS DEPENDS VERY HEAVILY
NOT ON THE SCENARIO YOU'VE
DESCRIBED IN THIS BOOK BUT ON
THE STATUS QUO.
WHAT'S GOING TO HAPPEN WHEN WE
DON'T NEED THEM TO DO 95 percent OF THE
THINGS WE NOW DO TODAY?

The caption changes to "Changing the finance sector."

Alex says THIS IS THE
MILLION DOLLAR QUESTION.
IT'S DIVIDED THE FINANCIAL
SERVICES INDUSTRY INTO A FEW
DIFFERENT CAMPS AND HOW THEY
THINK ABOUT THIS TECHNOLOGY.
THERE ARE SOME WHO DON'T REALLY
UNDERSTAND IT BUT UNDERSTAND IT
ENOUGH TO KNOW THAT IT WILL BE
DISRUPTIVE.
BECAUSE THEY'RE NOT REALLY FULLY
AWARE OF ITS CAPABILITIES,
THEY'RE AFRAID.
THEY'RE SCARED OF WHAT IT MIGHT
MEAN FOR THEIR BUSINESSES AND
THEY FEEL ENTRENCHED.
I HAD A FIRSTHAND EXPERIENCE OF
THIS IN DUBAI AT THE WORLD
ECONOMIC FORUM EVENT WHERE
SOMEONE FROM AN UNNAMED MONEY
TRANSFER COMPANY TOLD ME THAT
THIS WAS ALL NOT GOING TO HAPPEN
THE WAY THAT I WAS SUGGESTING.
THOSE PEOPLE ARE A MINORITY.
INCREASINGLY MORE FINANCIAL
SERVICES FIRMS FIT INTO BUCKET
NUMBER TWO.
THEY'RE LOOKING AT IT
OPPORTUNISTICALLY.
THEY SEE, LIKE WE DO, AN
OPPORTUNITY TO DISINTERMEDIATE
THIRD PARTIES THAT THEY RELY ON,
WHICH COULD CUT COSTS FOR THEIR
BUSINESS, THE RISK THAT YOUR
TRADING PARTNER DOESN'T HAVE A
CAPITAL TO THE FULFIL THE TRADE
AND THAT CAN BE A BIG SOURCE OF
CONCERN FOR FINANCIAL
INSTITUTIONS AND GENERALLY
SPEAKING INCREASE THE SPEED AND
FUNCTIONALITY OF THE INDUSTRY.
SO THEY SEE IT
OPPORTUNISTICALLY, AS A WAY TO
CUT COSTS AND SAVE MONEY.
THAT'S A FAIR WAY TO LOOK AT IT.
IT'S A WAY THAT'S VERY
BANK-LIKE.
IT'S ONE WHERE IN THIS CURRENT
ENVIRONMENT WHERE FIN TECH
COMPANIES ARE COMPETING WITH
THEM IN EVERY SINGLE MARKET.
IT'S A RATIONAL WAY OF THINKING
BUT THE WRONG WAY.

Steve says I READ IT IN YOUR
BOOK, TOWER RECORDS WAS NOT THE
COMPANY THAT INVENTED THE
IPOD, RIGHT?
IT'S PROBABLY NOT GOING TO BE
THE MAJOR BANKS TODAY THAT
DEVELOP WHATEVER THIS NEW SYSTEM
TO COME IS GOING TO BE?

Don says ALL OF THE
INCUMBENTS, THE BIG BANKS, HAVE
THIS PROBLEM OF PARADIGMS.
WHEN YOU GET A WHOLE NEW
PARADIGM, THE LEADERS OF THE OLD
OFTEN FIND GREAT DIFFICULTY
EMBRACING THE NEW.
IT'S BEEN THUS THROUGHOUT
HISTORY.
BUT THEY SHOULD.
THEY SHOULD GET ALL OVER THIS
AND UNDERSTAND THAT THE WORLD IS
CHANGING.
YOU THINK ABOUT IT.
LIKE, IF YOU TAP YOUR CARD IN
STARBUCKS, WHAT HAPPENS IS A
BUNCH OF MESSAGES GO THROUGH
EIGHT, TEN DIFFERENT COMPANIES,
SOME OF THEM USING MAIN FRAMES
FROM THE 1970s, AND THREE DAYS
LATER, A SETTLEMENT OCCURS.
WELL, IF THE BANKS WERE TO MOVE
TO A BLOCKCHAIN INFRASTRUCTURE
FOR ALL FINANCE, THEN THERE
WOULD BE NO THREE-DAY SETTLEMENT
BECAUSE THE PAYMENT AND THE
SETTLEMENT IS THE SAME ACTIVITY.

Steve says BUT, DON, YOU SAID
IT IN THE BOOK, AND I THINK I
HAVE ANOTHER SIMILE COMING TO
MIND... NOT SIMILE, BUT ANALOGY.
BLOCKBUSTER DIDN'T CREATE
NETFLIX.
ARE THEY CAPABLE OF THIS KIND OF
THINKING?

The caption changes to "Don Tapscott, @dtapscott."

Don says WE'RE MORE
HOPEFUL FOR THE CANADIAN BANKS.
THEY'RE BANKS THAT ARE BIG.
THERE ARE NOT A LOT OF THEM.
THEY'RE RELATIVELY STABLE.
THEY HAVE A GOOD REGULATORY
ENVIRONMENT.
AND THEN EACH OF THESE BANKS
TODAY THERE ARE INNOVATORS
TRYING TO THINK HOW FINANCIAL
SERVICES COULD BE VERY
DIFFERENT.
BUT AS ALEX WAS SAYING, THEY
NEED TO THINK STRATEGICALLY, NOT
JUST ABOUT SAVING MONEY.
NASDAQ, FOR EXAMPLE, OUR BOOK
LAUNCH IN NEW YORK WAS ON WALL
STREET AND IT WAS HOSTED BY
NASDAQ.
AND AT THE END, THEY SAID,
YOU'RE PROBABLY WONDERING WHY
WE'RE HERE HOSTING THIS BECAUSE
STOCK MARKETS CAN GO AWAY AS WE
CAN DO TRADES PEER TO PEER.
AND THEY SAID, BUT WE'RE NOT A
STOCK MARKET COMPANY, WE'RE A
TECHNOLOGY COMPANY.
AND WE'RE REALLY GOOD AT MAKING
MARKETS.
SO THEY SHOWED ON THE STAGE A
DEMONSTRATION OF A NEW
NASDAQ-DELIVERED ELECTRICAL
POWER GRID WHERE SUN SHINES ON A
SOLAR PANEL, ELECTRICITY IS SOLD
BACK INTO THE POWER GRID AT A
PEER-TO-PEER RATE, NOT TO
ONTARIO HYDRO AT WHOLESALE
RATES, SO THAT MOTIVATES ALL OF
US TO USE SOLAR, AND THEN WE
WATCHED ON THE STAGE AS DIGITAL
MONEY CAME INTO THE COMPUTER OF
THE GUY WHO HAD THIS SOLAR
PANEL.
SO THIS IS A COMPANY THINKING
STRATEGICALLY.

The caption changes to "Connect with us: @theagenda, TVO.org, YouTube, Facebook, Instagram."

Steve says I WANT TO PICK UP ON
THAT EXAMPLE.
YOU'RE GOING TO REMIND ME OF THE
PLACE IN THE BOOK WHERE THIS
TOOK PLACE.

Alex says SURE.

Steve says ELECTRICITY
GENERATION POLES ALL OVER THE
PLACE.
ONE OF THEM FALLS DOWN IN THE
MIDDLE OF NOWHERE, SOME REMOTE
LOCATION, IT TAKES THREE DAYS TO
GET GUYS OUT THERE TO FIX THE
POLE.
WAS IT IN NEW ZEALAND?

Alex says AUSTRALIA.

Steve says AUSTRALIA.
THAT'S PRETTY CLOSE.
OKAY.
SMART POLES.
RIGHT?
THIS IS THE FUTURE?
THIS IS WHAT YOU'RE TRYING TO
FIGURE OUT, WHERE A POLE CAN
AUTOMATICALLY IDENTIFY OR SEND A
MESSAGE TO SOMEBODY "I'M DOWN.
HELP FIX ME.
THIS FAMILY DOESN'T HAVE TO GO
THREE DAYS WITHOUT POWER."

The caption changes to "Alex Tapscott, @alextapscott."
Then, it changes again to "Beyond Blockchain."

Alex says THAT'S
ABSOLUTELY RIGHT.
THAT EXAMPLE IS ONE OF MANY IN
WHAT'S CALLED THE INTERNET OF
THINGS.
WE HEAR ABOUT THIS EXPRESSION
FROM TIME TO TIME BASICALLY
DESCRIBING A WORLD WHERE THERE
WILL BE HUNDREDS OF BILLIONS, IF
NOT TRILLIONS OF
INTERNET-ENABLED DEVICES DOING
EVERYTHING FROM DRIVING US
AROUND TO MANAGING OUR AFFAIRS
TO MONITORING OUR HEALTH TO
GENERATING OUR ELECTRICITY.
THESE DIFFERENT DEVICES, FROM
SMART POLES TO SMART WATCHES,
NEED A WAY TO COMMUNICATE VALUE
TO EACH OTHER IN THE SENSE THAT
IS SECURE, PRIVATE, AND
FRICTIONLESS.
YOU CAN IMAGINE AN EXAMPLE WHERE
THERE'S A LIGHT BULB IN YOUR
HOUSE AND GENERATING ELECTRICITY
THROUGH THE NASDAQ SMART GRID
THROUGH YOUR NEIGHBOUR'S SOLAR
PANEL AND METERING IT OUT AT SAY
A PENNY A DAY.
THAT'S NOT GOING TO THE VISA
NETWORKS BECAUSE VISA'S FEE IS
30 CENTS.
YOU'RE NOT GOING TO PUT A
30-CENT FEE ON A 1-CENT PAYMENT.
WE NEED A NEW NATIVE DIGITAL
MEDIUM TO MOVE VALUE BETWEEN
DIFFERENT DEVICES AND WE NEED A
WAY TO DO IT SECURELY.
YOU MAY RECALL A FEW WEEKS AGO
THE U.S. INTERNET WAS DOWN FOR
ABOUT A DAY.
THAT HAPPENED BECAUSE HACKERS
ATTACKED CHEAP INTERNET-ENABLED
DEVICES LIKE BABY MONITORS AND
THROUGH A DISTRIBUTED DENIAL OF
SERVICE ATTACK WERE ABLE TO TAKE
DOWN THE INTERNET.
THOSE DEVICES NEED A WAY TO
SECURE DATA AND TO MOVE DATA AND
TO MOVE VALUE WITHOUT RISK OF IT
BEING ATTACKED.

Don says FOR EXAMPLE,
THAT LIGHT BULB IS GOING TO PAY
THE POWER SOURCE AND THE LIGHT
BULB, USING A BLOCKCHAIN, WILL
HAVE A REPUTATION AND THE NASDAQ
POWER SOURCE WILL SELL ITS LIGHT
BECAUSE IT KNOWS IT'S A LIGHT
BULB THAT ALWAYS PAYS IT BILLS.
THE INTERNET OF EVERYTHING NEEDS
A LEDGER TO MANAGE ALL THIS.

Steve says I GET THAT.
PICK UP ON ALEX'S ANGLE OF
CONFIDENTIALITY, PRIVACY,
SECURITY... CONVINCE US THAT
THIS IS GOING TO PROTECT ALL OF
THOSE THINGS.

Don says THIS IS ONE
OF THE BIGGEST ARGUMENTS TO MOVE
TOWARDS A BLOCKCHAIN WORLD, THAT
THESE NEW PLATFORMS ARE MUCH
MORE SECURE.
TO MAKE A VERY LONG STORY SHORT,
IF A BLOCK IS JUST TYPICALLY,
SAY, A 10-MINUTE PERIOD OF TIME
WHERE ALL THE TRANSACTIONS ARE
CAPTURED.
WHO BOUGHT WHAT, WHO PAID FOR
WHO, WHO BOUGHT WHAT HOUSE, WHO
MARRIES WHO.
THERE'S A GROUP OF MINORS, NOT
YOUNG PEOPLE, BUT GOLD MINERS.
AND THEY OWN MASSIVE COMPUTING
RESOURCES, 10 TO 100 TIMES
BIGGER THAN ALL OF GOOGLE'S
SERVERS IN THE WORLD.
AND THEY COMPETE TO FIND OUT THE
TRUTH EVERY 10 MINUTES.
AND WHOEVER WINS GETS SOME OF
THE DIGITAL CURRENCY FROM THAT
BLOCKCHAIN.
SO IF I WANTED TO GO AND HACK A
BLOCK AND PAY YOU A HUNDRED AND
PAY IT ALSO TO ALEX, I'D HAVE TO
HACK THAT BLOCK, NOT JUST ON ONE
COMPUTER BUT ACROSS MILLIONS OF
COMPUTERS ALL AROUND THE WORLD,
AND IT'S A CHAIN.
SO EACH BLOCK IS CONNECTED TO
THE PREVIOUS BLOCK.
THEY'D HAVE TO HACK THE ENTIRE
HISTORY OF COMMERCE ON THAT
BLOCKCHAIN ALL IN THE LIGHT OF
THE MOST POWERFUL COMPUTING
RESOURCE IN THE WORLD THAT'S
WATCHING ME TO MAKE SURE I DON'T
MESS AROUND.

Steve says THEORETICALLY, IT
SHOULD BE MORE SECURE.

Don says IT'S
INFINITELY MORE SECURE THAN THE
SYSTEMS WE HAVE TODAY.
WE WON'T SAY IT'S UNHACKABLE.

Alex says JUST SHY OF
UNHACKABLE.
IF WE SAY IT'S UNHACKABLE ON
THIS SHOW, TOMORROW MORNING, IT
WILL GET HACKED.

Steve says SO YOU DON'T WANT TO
SAY THAT.
ALEX, I KNOW ONE OF THE THINGS
YOU SAY IN THE BOOK IS YOU HOPE
THIS REVOLUTION WILL BRING A
FLATTER EARTH, WILL BRING A MORE
DEMOCRATIC, A MORE EQUITABLE
SOCIETY FOR ALL.
BUT I DON'T HAVE TO TELL EITHER
OF YOU GUYS THAT WE JUST SAW AN
ELECTION IN THE UNITED STATES
WHERE A LOT OF PEOPLE, MAYBE
60 MILLION, VOTED IN A CERTAIN
WAY BECAUSE THEY ARE TERRIFIED
ABOUT THE PACE OF CHANGE, ABOUT
GLOBALIZATION, ABOUT THINGS
HAPPENING TOO FAST THAT THEY
CAN'T CONTROL OR UNDERSTAND, AND
I'LL TELL YOU SOMETHING.
I HAD A LOT OF SYMPATHY FOR THEM
HAVING READ YOUR BOOK BECAUSE A
LOT OF THIS STUFF IS VERY HARD
TO... YOU'RE EXPLAINING IT VERY
WELL, BUT IT'S VERY HARD TO
GRASP AND, YOU KNOW, IT'S THE
FUTURE AND IT'S MOVING VERY,
VERY QUICKLY.
HOW IS THIS GOING TO MAKE THE
WORLD ACTUALLY FLATTER, MORE
DEMOCRATIC, MORE EQUITABLE, AND
NOT JUST INCREASE THE DISPARITY
THAT TOO MANY PEOPLE IN THIS
WORLD ARE ALREADY FEELING?

The caption changes to "A technology here to stay."

Alex says WELL, WE
DON'T FAIL TO SEE THE IRONY IN
SUGGESTING THAT THIS TECHNOLOGY
COULD CREATE A MORE FAIR AND
PROSPEROUS WORLD WHEN PREVIOUS
TECHNOLOGIES HAVE DONE BASICALLY
THE OPPOSITE.
BUT WE THINK THIS TIME IT'S
DIFFERENT.
THIS TECHNOLOGY HAS THE
POTENTIAL TO SOLVE WHAT WE CALL
IN THE BOOK THE PROSPERITY
PARADOX.
THIS PROBLEM THAT WEALTH IS
BEING CREATED BUT PROSPERITY IS
NOT INCREASING, MEANING THAT THE
RISING TIDE OF TECHNOLOGY IS NO
LONGER LIFTING ALL BOATS IN THE
WAY IT MAY HAVE BEFORE IN THE
PAST.
BUT WHEREAS THE INTERNET WAS
ABOUT INFORMATION, THIS IS ABOUT
VALUE.
AND ESSENTIALLY, IT COULD SOLVE
A LOT OF BIG PROBLEMS.
FOR EXAMPLE, THERE ARE TWO AND A
HALF BILLION IN THE WORLD WHO
DON'T HAVE ACCESS TO BASIC
FINANCIAL SERVICES.
THEY DON'T HAVE A WAY TO STORE
MONEY THAT'S NOT IN, SAY, AN
ANIMAL THAT THEY OWN.
THEY DON'T HAVE A WAY TO MOVE
MONEY THAT ISN'T THROUGH
EGREGIOUSLY PRICED SERVICES.
IT IS CAPTURED IN A GRAY ECONOMY
THAT ISN'T CONNECTED TO THE
WORLD.
EVEN THOUGH GLOBALIZATION HAS
CREATED WEALTH, THEY HAVEN'T
PARTICIPATED.
NOW YOU CAN LOCK THE BARRIERS
FOR FINANCIAL INCLUSION WHERE
THE NUTS AND BOLTS OF RETAIL
BANKING, SAVINGS AND ACCESS TO
CREDIT.
PERHAPS A BIGGER PROBLEM IS LAND
TITLING.
IN THE DEVELOPING WORLD, 70 percent OF
PEOPLE WHO THINK THEY OWN
PROPERTIES ACTUALLY HAVE AN
UNENFORCEABLE CLAIM TO THAT
PROPERTY, MEANING THAT THERE
COULD BE AN INCOMPLETE RECORD IN
A GOVERNMENT OFFICE, THERE COULD
BE A COMPETING CLAIM THAT
SOMEONE ELSE HAS BECAUSE THE
RECORDS ARE JUST PLAIN SHODDY,
OR THEY MAY THINK THEY OWN IT
BUT THEY HAVE NO CLAIM AT ALL.
AND IT TURNS OUT THAT PROPERTY
OWNERSHIP IS BASICALLY A
PRECONDITION FOR ANY KIND OF
UPWARD MOBILITY, PERIOD, FULL
STOP.
IT'S NOT ONLY THE ROOF OVER YOUR
HEAD, IT IS A WAY TO GENERATE
INCOME, IT IS A SOURCE OF CREDIT
IF YOU WANT TO START A BUSINESS
OR PAY FOR AN EDUCATION, IT IS
LITERALLY THE LIFE BLOOD OF SO
MANY PEOPLE'S PERSONAL FINANCES.
SO IF WE HAD PERSONAL PROPERTY
RECORDS LIVING ON A DISTRIBUTED
LEDGER, EVERYONE WOULD KNOW FOR
SURE WHO OWNED WHAT.
IT WOULD ALSO MEAN THAT EITHER A
CORRUPT DICTATOR OR JUST A
CORRUPT LOCAL OFFICIAL IN THE
NEIGHBOURHOOD, YOU KNOW,
GOVERNMENT OFFICE COULDN'T
UNILATERALLY CHANGE A RECORD
WITHOUT IT BEING IMMEDIATELY
SPOTTED AND FIXED BY A NETWORK
OF MILLIONS OF EYEBALLS WHO ARE
MAKING SURE THAT INTEGRITY IS
CODED INTO THE SYSTEM.

Steve says LET ME PURSUE THAT
WITH YOUR DAD A BIT.

Alex says SURE.

Steve says SORRY, I SHOULDN'T
HAVE SAID THAT.
YOU'VE BEEN SO STUDIOUS...

Don says WELL, HE IS MY SON.

Steve says YOU'VE BEEN SO
CAREFUL NOT TO CALL HIM DAD ONCE
IN THIS WHOLE INTERVIEW.

Alex says THAT'S ALL RIGHT.
HE HAS THE ABILITY TO PICK UP
WHERE I LEFT OFF AND VICE VERSA
BECAUSE WE ACTUALLY SHARE A BRAND.

Steve says YOU SHARE A LOT MORE
THAN THAT.
OKAY.
WHERE DID I WANT TO GO NOW?
I REMEMBER WHEN SOMEBODY TRIED
TO TAKE OVER BITCOIN, RIGHT?
SOMEBODY TRIED TO OWN IT ALL.
SOMEBODY TRIED TO CORNER THE
MARKET ON BITCOIN.
AND WHAT'S TO STOP ANYBODY FROM
DOING THAT HERE?
CAN SOMEBODY TAKE IT OVER?

Don says IN THEORY,
YES.
BUT TO DO THAT, YOU'D HAVE TO
DEVELOP A COMPUTING CAPABILITY
THAT'S SIGNIFICANTLY BIGGER THAN
THE EXISTING MINER COMMUNITY
WHICH IS 10 TO 100 TIMES BIGGER
THAN ALL THE GOOGLE'S SERVERS IN
THE WORLD.
SO GOOD LUCK DOING THAT.
WHY WOULD YOU DO IT?
IF YOU TOOK IT OVER, THEN IT
WOULD BE WORTH NOTHING.

Steve says WELL, UNLESS AS A
GATE KEEPER YOU CAN CHARGE
ANYBODY ANYTHING...

Don says NO, YOU
CAN'T.
IF YOU TAKE IT OVER, THEN THE
VALUE OF THE ENTIRE NETWORK GOES
TO ZERO BECAUSE THE TRUST HAS
BEEN DESTROYED AND PEOPLE CAN'T
COUNT ON EACH OTHER TO DO
TRANSACTIONS.
IT WOULD ACTUALLY BECOME WORTH
NOTHING.

Steve says IT REALLY DOES
DEPEND, ON THE FACE OF IT,
BEING AS DEMOCRATIC AS POSSIBLE

Don says THE ONLY
SCENARIO YOU COULD POSSIBLY
IMAGINE WOULD BE LIKE ISIS GETS
STATE POWER SOMEWHERE IN A
SIGNIFICANT COUNTRY AND THEY
DECIDE TO USE MASSIVE RESOURCES
OF THE STATE TO TRY AND JUST
BRING THIS THING DOWN JUST TO
DISRUPT THINGS.
IN THE BOOK, THERE ARE A LOT OF
THESE INTERESTING PROBLEMS THAT
WE TALK ABOUT, AND WE PUT THEM
ALL IN ONE OF TWO CATEGORIES.
THIS IS THE REASON WHY THIS IS A
BAD IDEA.
OR IS THIS AN IMPLEMENTATION
CHALLENGE AND SOMETHING THAT WE
NEED TO MANAGE?
AND THE BENEFITS SO FAR OUTWEIGH
THE DOWNSIDE THAT THEY ALL ENDED
UP IN BUCKET NUMBER 2.
BUT, YOU KNOW, THE FUTURE...
IT'S NOT SOMETHING TO BE
PREDICTED, IT'S SOMETHING TO BE
ACHIEVED AND WE ALL NEED TO GET
INVOLVED IN THIS STUFF AND MAKE
SURE THAT THIS SMALLER WORLD
THAT OUR KIDS INHERIT MIGHT
ACTUALLY BE A BETTER ONE.

The caption changes to "Producer: Katie O'Connor, @KA_OConnor."

Steve says THE TAPSCOTT BOYS
HAVE DONE IT AGAIN.
IT'S GREAT TO HAVE YOU TWO HERE.
NICE TO MEET YOU.
WE'VE HAD HIM HERE BEFORE.
"BLOCKCHAIN REVOLUTION."
HOW THE TECHNOLOGY BEHIND
BITCOIN IS CHANGING MONEY,
BUSINESS AND THE WORLD.
WE THINK YOU'VE LET IN ON SOME
OF IT DURING THE CONVERSATION.
ALEX TAPSCOTT AND DON TAPSCOTT,
THANKS VERY MUCH FOR COMING IN
TONIGHT.

Alex says OUR PLEASURE.

Watch: The Next Digital Revolution