Bitcoin Foundation’s chief scientist Gavin Andresen addressed the subject of bitcoin regulation as part of the US Council on Foreign Relations’ (CFR) latest ‘Voices of the Next Generation’ discussion in Washington, DC today.
During the 60-minute question-and-answer session, attendees and moderator Douglas Rediker asked Andresen probing and sometimes pointed questions about the emerging virtual currency, as well as its implications for governments and the world economy.
Perhaps most notably, Andresen stated that the bitcoin community would welcome smart regulations that enhance the safety of the ecosystem:
“Consumer protection makes sense. You should have some idea of who you’re interacting with if you’re trusting them with money,” Andresen said.
Furthermore, Andresen suggested that democratic governments won’t be likely to have success if they try to control bitcoin.
“For other more liberal countries, it’s going to be tough to say don’t buy shoes from someone in this country because we don’t like that country.”
Overall, Andresen said he did his best to “stay humble” while building a rapport between bitcoin and an audience that was not yet familiar with the goals and concepts driving the currency.
“I think people love to think that there’s somebody that does have all the answers, I just try to be careful to not pretend that I have some knowledge that I don’t,” Andresen told CoinDesk after the meeting.
Despite, or perhaps because of, the open nature of the discussion, the majority of the questions focused on what could be perceived as potential weak points in Bitcoin’s design.
These included queries about how much control Bitcoin Foundation members have over the Bitcoin protocol, whether bitcoin users viewed any regulation as beneficial, and whether bitcoin’s deflationary nature could inhibit spending when used on a mass scale.
As a result, the tone seemed more indicative of the growing public concern over bitcoin than the tenor of the CFR’s original email suggested.
“Bitcoin is still in its early adopter phase. It’s so young still, it doesn’t surprise me that people don’t grasp the basics,” Andresen said.
If those asking questions were seeking more direct answers, Andresen did his best to frame bitcoin the currency as a work in progress that is seeking larger shared benefits for the world, and bitcoin the community as one where questions are always welcomed, if not yet answerable.
“All moneys are this shared delusion. They’re valuable because they say we have value. Money doesn’t grow on trees,” Andresen commented.
Like witnesses at the NYDFS hearings last month, Andresen chose to compare bitcoin to the Internet, focusing on how it could improve pain points shared by all consumers and lead to cheaper, faster and better ways of payment that promote the common good.
“If you think about the payment systems we have today, it was created in the paper days. It’s evolved, although if you try to pay somebody, it may take three to four to five days, that’s kind of crazy,” Andresen said.
A successful failure
The chief scientist also emphasized that bitcoin could still fail, and that certain unforeseeable events – such as errors with coding, or a new and improved system – could ultimately render it useless.
The problem with the current payment system, Andresen postured, is bigger than bitcoin, and may prove beyond its capabilities. He added:
“If Bitcoin turns out to be a miserable failure, but it does encourage some government to realize that our payment systems are broken and archaic, and some country decides we’re going to make a payment system for this century, I think that would be a huge success.”
“Voices of the Next Generation” series
Andresen’s invitation to the noted CFR series inspired mixed reactions on bitcoin forums, with some viewing the invitation as a promising sign of bitcoin’s increasing mainstream acceptance, and others suggesting the CFR’s decision could potentially harbor more hostile motives.
Andresen has been an outspoken thought leader in the burgeoning industry, and joins other distinguished alumni of the series, including New Republic editor Peter Beinart and Eurasia Group president Ian Bremmer, on the list of those who have given talks to the CFR.
Andresen’s bitcoin history
Andresen began the CFR discussion by introducing himself and his past work on bitcoin, which began in 2010. He notably mentioned Bitcoin Faucet, a now defunct project that over the course of its run “gave away 10,000 BTC,” which Andresen estimated to be worth $8m by today’s standards.
“Since then, my life has been endlessly fascinating,” he remarked.
In May, Andresen sat down with CoinDesk to reveal his views on where the currency was headed. Andresen described himself as conservative – and, unsurprisingly given the day’s comments, suggested that he sees government playing an increasing role in regulating virtual currency.