Bitcoin Q&A: How is fungibility tied to privacy?


What do you think about the fungibility of a bitcoin? Yes, somebody suggested that I should end my my talk with Liberté égalité a fungibility That’s an insider joke for us bitcoiners Fungibility so first of all does anybody okay? Who does not understand the word fungibility or hasn’t is not familiar with it great? Let’s talk about fungibility So one Euro is one Euro is one Euro if you receive a Euro it Doesn’t matter where it came from it doesn’t matter if two people before you it was stolen It doesn’t matter if two people before you it was robbed from a bank It’s a euro upon presentation that Euro is the same as every other Euro And no one can say I’ll take this euro but I won’t take that euro and and that is not simply a matter of Practice that is a matter of law, and this law was settled in the 16th century Where someone said actually? That’s my Euro It was stolen And they took someone to court Who was not the person who stole it who was person who received it several times later and said that is stolen property Okay, wasn’t a euro. It was a franc or something like that. I think it was a pound sterling actually And it was taken to court and the Court said you can’t do that So money is the one type of property that cannot be stolen and then recovered by the original owner if you steal money Right you can’t say that’s my money Give it back to people later. You can say it to the person who stole it But you can’t just walk into a shop and say I’m gonna. Sue you because you have the money that was stolen from me That’s fungibility The reason we have fungibility in the currency is very very simple otherwise it wouldn’t work if every time you received a euro you had to open a list or database and say okay serial number 1 3 1 3 3 7 7 – is that a good euro or a bad euro is it a medium here all the kind of naughty Euro? Is it a bit cocaine eeeeh? Is it a bit terrorist II? Because then it’s not one hero it’s 0.72 euros it’s 0.76 euros now this one’s a bit too. Cocaine is 0.53 euros in value, right? Oh this one was touched by Elton John it’s 1.6. Euros We don’t accept that as a model for using currency and the reason we don’t accept it is because it wouldn’t work if you had To check the provenance of every system of money that you receive You couldn’t make currency work and the reason you couldn’t make it work is not Just because you would have to track a database that had to be perfect and always updated with every coin in it But the most important thing is that no euro would be worth one hero Every Euro would be worth a different value weighted by how liquid it is how circular Bowl it is Whether you could use it, right? So if you can use it but some places and not use it other places Automatically its value drops and now you have to keep track of what the value of one hero is in here. Oh, right? That’s fungibility. It’s the understanding by law understanding by practice and Technological fact that every unit of currency is indistinguishable Or is treated as indistinguishable from every other unit of currency Bitcoin is fungible ish Somewhat fungible in Bitcoin you can trace the provenance of every coin by practice By custom. We don’t do that We are beginning to see some companies do that that is a problem if you go to Bitstamp coinbase Zappo, and you say here’s my bitcoin, and they say well three bitcoins ago Or three transactions ago this came from Bitfenix And we’re gonna freeze your account You have a problem right? So that’s fungibility being destroyed right now in Bitcoin however at the same time We’re seeing a lot of technologies being developed to improve function t. Because fungibility also has to do with privacy and Anonymity which are really important characteristics that we’re trying to strengthen and at the same time preserve within bitcoin and that means ensuring that Transactions are private that you don’t know who is who in a transaction that you don’t know what value is being transmitted There’s a number of technologies being developed for that which make bitcoin extremely private Where you can’t even see the value of the transactions being made you can’t tell who is the Sender and who is the recipient? You can’t tell how much money is being paid and it? really fixes Fungibility because you simply can’t track coins from one to another and This is the point where most people go, but what about criminals, but what about drug dealers, but what about? Terrorists aren’t they going to use this to do that? Yes They’re going to use this to do that and if you didn’t do it in bitcoin They’re going to use another cryptocurrency that already does that there’s half a dozen Available that already do that. And if you say you can’t use those I’ll invent two. I’ll write one this weekend this weekend that can do that The bottom line is that criminals will use technology even if it’s illegal Incredible idea and so banning Technology Only effects the people who aren’t criminals Is this me this is Wild Philosophy I know So you can’t actually ban technology? especially open-source technology because the only people who will be affected by the ban are the innocent and the idiots The people who couldn’t figure out how to use the technology that actually allowed them to hide the sources of their money So fungibility is something we’re fixing in bitcoin because what it does is It helps everybody the innocent the well-meaning the people who pay taxes and want to educate their children and feed their children and buy homes and cars and operate in society protect their privacy from predators from corporations from Tyrannical governments from Oppressive governments, and so we need to do privacy for them and criminals will also use it that’s my answer for fungibility. Thank you so much. That was a good last question. It’s been a pleasure Thank you, everyone

26 thoughts on “Bitcoin Q&A: How is fungibility tied to privacy?”

  1. The only people who want Bitcoin tracking and fungibility paths are tyrannical regulators who want to ban this new technology because their corporate, globalist masters said so.

  2. I learn so much not just about Bitcoin but the whole mechanics behind money. Very good content. Always thought provoking

  3. Que es lo que pasa con los videos antes podia configurar al español, ahora no sale la opcion de traducir, podrías ver la forma de corregir.

  4. The Rothschilds banks have funded wars and terrorism for centuries. The Vatican bank laundered drug money in South America. American banks built Nazi Germany and Saddam's Iraq, and then subsequently tore those institutions down. No form of money has ever evaded politics, corruption, and all the other trappings of power. Cryptos will not avoid those either.

  5. Nobody knows more about bitcoin and the crypto space as a whole than you Andreas so Thank You. I watch every video you post and I have learned so much from you. I am but a humble neophyte in this space and I also watch videos from most people in crypto both on the bitcoin side and the alt side and what strikes me most about you is…you speak the truth. No more…no less.You don't post videos that entice mental uncertainty or promotes panic. You simply tell it like it is in a way us non-geniuses can relate to. If you ever come back to my home, Las Vegas NV., I will definitely pay whatever amount of bitcoin I have to to hear you speak.

  6. It's ironic how one of the best explainers of the nascent revolution in world finance comes from a native of one of the most economically dysfunctional countries in the world. But Greeks are brilliant people even if their political class is full of idiots.

  7. What about this? IMF Publishes Report Detailing Regulatory Recommendations for the Cryptocurrency Industries: https://news.bitcoin.com/imf-publishes-report-detailing-regulatory-recommendations-for-the-cryptocurrency-industries/?utm_source=OneSignal%20Push&utm_medium=notification&utm_campaign=Push%20Notifications

  8. Fun fact : This is not true for a 500€ note. Most (95%) of sellers won't accept it in France, even if you buy something costing exactly 500€.

  9. I always like to use the example below for fungibility.

    Fungible:
    You lend your crisp new dollar bill to your buddy. Later in the day he returns a crumpled dollar bill with a different serial number. All okay!

    Not Fungible:
    You drop your white 2nd grader at elementary school. Later in the day the teacher returns an asian 2nd grader. Not okay!

  10. @aantonop +aantonop ….. What technologies are you talking about that will hide recipient and sender? I'm familiar with maxwells CT, but that only hides amounts.

  11. Very simple way of describing, though- a broad viewpoint- much love to you aantonop for this passionate way of talking, much pleasure

  12. Do you think people should be out of cryptocoins before Aug 1st? BIP148 change that could impact Bitcoin (and when Bitcoin is impacted all others seem to be impacted as well)

  13. Question… if bitcoin hardforks and I have BTC in cold storage once I get it out what bitcoin will I have? everyone says cold storage is the answer but no one says why….

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