In 2009, a person or group of people created Bitcoin, a digital currency. Unlike traditional currencies, which are backed by central governments that regulate their value and supply, Bitcoin is computer-generated and has no overarching authority controlling it. Today, Bitcoin and other "cryptocurrencies" are worth billions. Supporters of these cryptocurrencies argue that they will revolutionize global finance by placing control of currency in the hands of users, not nations, and make financial exchanges more transparent, efficient, and democratic. Bitcoin, they claim, is market-driven and safe. But is it? Critics argue that cryptocurrencies provide a platform for illicit activity, including money laundering, human trafficking, and drug dealing, free from government oversight and regulation. They further contend that Bitcoin has no intrinsic value and could collapse at any time. Is Bitcoin more than a bubble and here to stay?
Bitcoin Debate Introduction (03:26)
Moderator John Donvan introduces Robert Rosenkranz and Allison Mangiero. The organizers discuss using a debate format and Bitcoin.
Debate "Housekeeping" (05:08)
Donvan frames the debate on Bitcoin and introduces the panelists.
Opening Statement For: Tim Draper (07:01)
Venture Capitalist, and Draper Associates and Draper Fisher Juveston Founder, Draper provides a brief history of currencies. Bitcoin uses computers as a third party to ensure transactions are perfect. Draper denounces the term bubble.
Opening Statement Against: Eric Posner (06:29)
Legal scholar and media commentator, Posner quotes from "The Wealth of Nations" and explains bubbles. He provides three reasons to support the idea that Bitcoin is currently a bubble.
Opening Statement For: Patrick Byrne (06:24)
CEO of Overstock.com and tZero, Byrne states that Bitcoin allows trustworthy consensual exchange among strangers; central institutions are no longer necessary. Byrne discounts the need for the United States Federal Reserve to manage the money supply.
Opening Statement Against: Gillian Tett (06:23)
Journalist, author, and "Financial Times" editor Tett cites three things about fiat currency. Bitcoin is not a good medium of exchange and its value fluctuates. Tett questions trust.
Trust in Bitcoin (07:35)
Donvan summarizes opening statements. Byrne explains the mathematics in Bitcoin. The panelists debate security and the Central Bank. Posner explains fiat currency.
Bitcoin Control and Criminality (05:02)
Posner states that programmers and miners control the currency; 51% of hashing power is necessary to change code. Draper argues that it is a fear tactic; a blockchain catches criminal activity. Opponents counter Draper's claims.
Advantages vs. Disadvantages (05:08)
Tett questions why people believe Bitcoin will become more widely used and useful than other alternatives. She and Byrne debate shortcomings of fiat currency and gold. Draper states that people are leaving countries and Bitcoin will become mainstream.
Bitcoin Liberation and Decentralization (05:35)
Posner explains why government control of the money supply is essential. Byrne counters that expanding the money supply results in collapse. Draper and Tett debate Bitcoin's volatility.
Regular Users and Bitcoin (05:14)
Draper believes Bitcoin is viable; Byrne acknowledges crypto-currency is risky. Draper discusses his predictions for Bitcoin and the value of the currency; Donvan infers that Tett and Poser lack vision. Tett compares Bitcoin to Pets.com.
Q/A: Bitcoin Sophistication (01:49)
Byrne does not believe people should be entirely responsible for the security of their transactions; he supports an incremental approach. Posner counters that big companies will act as intermediaries and skim profits.
Q/A: Small Investments (01:54)
Draper believes that over time, Bitcoin ownership should increase; Byrne wants to see how Bitcoin evolves. Posner reiterates that Bitcoin is a speculative investment.
Q/A: Bitcoin Regulation (04:36)
Regulators have had a "hands off" attitude to maintain a competitive edge; they would destroy Bitcoin if it took over national currency. Tett asserts the need not to confuse blockchains with Bitcoin. Draper discusses virtual governments.
Q/A: Financial Crisis with Bitcoin (04:37)
Byrne states that a crisis would not occur; there would be stable, steady growth. Posner counters that booms and busts will continue to exist. Draper argues that governments will perform better if forced to compete for you.
Q/A: Value of Bitcoin (02:13)
Byrne considers whether his business will measure merchandise in terms of Bitcoins. Draper cites examples of products available only in Bitcoin.
Q/A: Crypto-currency Market (03:50)
Byrne states that Bitcoin will have a foundational role in the crypto-economy; transactions are transparent and do not require a leap of faith. Posner cites energy use as the fatal flaw of Bitcoin.
Q/A: Currency Coexistence? (01:38)
Draper states that fiat currencies will try to adapt; Bitcoin is a better currency. Tett compares Bitcoin to travelers' checks and digital gold.
Concluding Statement For: Draper (02:28)
Draper reads several statements from the past that have been proven false in society.
Concluding Statement Against: Posner (02:17)
Bitcoin transactions take 10 minutes during high volume and are not free, few merchants accept Bitcoin, and 25% of Bitcoin users are associated with criminal activity.
Concluding Statement For: Byrne (02:21)
Bitcoin adds value to society and will result in less illegality. The Central Bank is responsible for deflation and inflation.
Concluding Statement Against: Tett (02:20)
Fiat currencies have a promise of the government. Would you rather bet on tangible currency and the government, or Satoshi Nakamoto?
Time to Vote (04:05)
Donvan thanks IQ supporters and panelists for their participation. Panelists consider whether opponent arguments changed their opinion.
Audience Vote Results (01:12)
Pre-Debate - For: 39% - Against: 38% - Undecided: 23% Post-Debate - For: 25% - Against: 68% - Undecided: 7%
Credits: Bitcoin Is More Than a Bubble and Here to Stay: A Debate (00:04)