Ethereum Co-Founder & Bitcoin Professional Charles Hoskinson at Cointelegraph channel

Hey, from Aspen, Colorado, this is Maria Jones at Cointelegraph. And I have a very special guest for you today, legendary Chaz Hoskinson.

Thanks for having me on.

Thank you so much. We want to know everything, so the first question will be how did you get involved in the world of cryptocurrencies?

That's a good question. So I started as a mathematician, but I always had a love of monetary policy, so I wanted to do something in the cryptocurrency space, but I didn't know anybody. So I remembered an old adage which is those who cannot do, teach. So I decided to create a class called Bitcoin or How I learned to Stop Worrying and Love Crypto. And I ended up getting 50,000 students and over 5,000 emails. And that allowed me to bootstrap and create Bitshares with Dan Larimer, Ethereum with Vitalik and all the other success that I have.

I've heard your TED talk and you said the future is decentralized. So what exactly does it mean?

So if you look at the way society works right now, we live with a collection of silos, all these central repositories, whether they be knowledge, like universities or banks which control the money, or governments which control the moral mandate to do things. And so what decentralization is all about is using this technology to gradually turn these centralized hierarchical organizations into flatter organizations where we actually have a lot more control and autonomy.

So how do you see the digital world, let's say in 30 years?

Well, it's always hard to predict where we're going to be in 30 years and every time one tries it's difficult. Except for R.C. clark. But you know, if I had to say 30, you know, my hope would be that this technology allows a transformation in society where the world gets more transparent and fair and we have a lot more control over our day to day affairs and more democratic institutions.

All our followers, they want to know and we can't keep this question. So tell us about Ethereum and Ethereum Classic.

So Ethereum is kind of an interesting story. I call it the Accidental Project because, because everything about it wasn't supposed to be the way it was. Vitalik was working on Color Coins and Master Coin and these projects were very difficult in that every time they wanted to do something it was very painful to do it with Bitcoin, yet that was the only platform they had. So Vitalik said, could we abstract this and give ourselves a cool programming language where instead of building these very difficult expensive protocols, we can just implement them in a few lines of code. So originally he just thought this idea is like an overlay protocol or something like that. Nothing special, no token or these things. But he brought a lot of people in, myself included, and we said, well, maybe we can actually build something unique from this. So little by little, as the project grew, we went from hey, let's just do a quick six month thing to maybe we have something very significant and real here and we invented concepts like Cody's Law and elegality and so forth. Anyway, I left the project in 2014 and they continued to take it on and build it up into this leviathan. But I always kept the core philosophy of the project, which was that once you write the code and run the code, you can't change the code. Code is law. And so then the Dow event occurred. And this resulted in a situation where a decision had to be made to violate that principle, in their view, for the greater good. And it was not an easy question. On one hand, a huge amount of stake in the ecosystem was locked up and about to go to a criminal. On the other hand, by doing this, it created a precedent to bail out ventures that were too big to fail. So I was on the side that said it was, despite the bad consequences in the short term, better for us to let it clear the market as we did Mount Gox and other events, whereas Vitalik and others were on the side of bail them out. And as a consequence, Ethereum split into two different ecosystems. One is Ethereum Classic and the other is Ethereum.

I know this story, but I want our followers to know it as well. Tell us about your current project. So what are you doing now?

Yeah, so IOHK is kind of the fun company I get to run. I've done two very stressful companies and this one's the fun one. So what I really wanted to do was focus on the science of the cryptocurrency space. So what we wanted to do is say, listen, we have all these great protocols and these great ideas that exist. Unfortunately they're not on solid foundations from an academic and rigorous standpoint. So what we wanted to do was build something that had a marriage with the universities and the professors and to do peer reviewed research, then to take all those capabilities and actually build third generation cryptocurrencies, currencies that focus on interoperability and governance and scalability and so forth. So we've had tremendous success. IOHK has grown from two people, my co founder and I, to over 100 and we operate in 10 countries. And now we're really getting to it. We just submitted a paper, for example, to Eurocrypt. We were just at crypto 17 with a new provably secure proof of stake protocol. We have lots of papers coming out, a lot of good products that we're going to be Building in 2017, 2018.

What's your next destination, by the way?

Next is Scotland. I'm going to our research center up there. And then from Scotland, Japan. So I travel about 200 days a year to 250 days.

Charles, what is your biggest dream?

My hope is that I can finish what we started in this space. If we are able to build the tools that allow us to decentralize banks and decentralize insurance and decentralized voting and governance and get these tools into the hands of as many people as possible, then I think we've built a better world. A world that's not controlled by any one person, but rather by everybody. And we can benefit by the wisdom of the crowds. So that's my goal. That's why we structured IOHK the way we did. We don't pursue intellectual property, we don't pursue patents. Everything we do is open source in a GitHub repo, and we're as decentralized of a company as possible. My other hope is that this technology becomes truly accessible in the developing world. I care very deeply about Africa and South America, Southeast Asia, because it was.

On TED Talk as well.

Sure. So one of the problems with banking, the unbanked, is that it just simply costs too much money to bank them with the legacy infrastructure. So a mental analogy you can carry is the difference between cell phones and copper wire. So in the beginning, we had telephones on copper wire, and they're very expensive because you have to put them in the ground and drag the lines to each and every person's house. So countries like America, you know, it's easy to do this, but you know, it's impossible to do this in Pakistan or Afghanistan. So when we started giving people phones in these countries, did we, oh, let's just put a bunch of copper wires in the ground? No, we created cell phone towers and gave everybody cell phones because it was a better technology. So analogously, the banking industry is the exact same way. You cannot take JPMorgan Chase, replicate it, and put it into Cambodia and expect to be able to bank a substantial amount of the population. The compliance cost alone would be more than the value of the customers. But this technology is becoming so cheap and easy and scalable to use that within Just a generation or two, it'll be on a cell phone, incredibly easy to use, incredibly low cost. And eventually we'll be able to provide equivalent banking services, whether they be lending or insurance or just depository services and payment to everybody in the world and get it all on their cell phones. And that's one of my passions, is to find a way to do that for the 3 billion people who don't have it.

Yeah, Bitcoin is a fraud.

Well, so Jamie Dimon is the guy I believe uttered that one lately. And asking Jamie Dimon what he thinks of bitcoin is like asking a king what he thinks of democracy. You know, I understand why he has reservations for this particular type of system because it kind of makes his business model obsolete. In reality, banks are creatures of necessity. We create them because we recognize that they provide a lot of benefit to society. But in the process of creating them, we endow certain people with powers that give them the ability to manipulate society to our detriment. As most recent example is 2008. But we've had hundreds of financial collapses. So I can understand why Jamie is threatened by a technology that says we can have all the benefits of the banks, but we don't actually put anybody in charge, meaning he gets fired. So I can imagine that he's probably not so thrilled with his technology, which by the way, he's been trading his company. His traders are already trading Bitcoin and have been doing it since 2013 and the exchange rate.

So any predictions?

I always stay out of price predictions because I'm always wrong. I'm one of the world's worst traders. A common thing is if I knew what the price of bitcoin was going to be, I'd probably be in a different industry. I'd probably be a hedge fund manager or something like that.

In light of Chinese ICO banks and government regulators and statements, what do you think? Is it really matters or not?

I don't think banning in China or any other jurisdiction particularly matters to bitcoin in that first, China bans a lot of stuff. Soft cheese has been banned recently in China. So it's important not to draw too much into it. But it's not inconceivable that a government that likes to tightly control every aspect of its citizens lives is a bit scared of something that allows them to control their own money and evade capital controls. So it's entirely predictable that bitcoin would be banned in these types of jurisdictions, just like typewriters were banned in the Soviet Union. You don't want to give people too much freedom. So actually, I think the banning of bitcoin in China, as it might be temporary or permanent, who knows, is actually a very positive sign. It's telling you that we've grown beyond a technological novelty to actually something that could have a real impact on people's lives and society as a whole. Be sure to follow cointelegraphy.