Hi everyone, so the Elon Musk comparison was fun.
Big shoes to fill. I’m gonna take you on a little bit of a journey
through a couple of decades of technology. I started life as a, not life,
but I started kind of as a hardware hacker,
ended up as a venture capitalist. I did, by the way, kiteboard with Elon Musk,
so he’s a friend. I was trained as an electrical engineer
to design computer chips. And I was so drawn to all
the activity in Silicon Valley that I moved out there in this era,
right at the tail end of that era. What you see there is something called
a Homebrew Computer Club and it was basically a community of people
that were interested in electronic stuff. And there were a lot of interesting young people,
a little bit older than me but young people that
you can see up there, Bill Gates, Paul Allen, Steve Jobs, Steve Wozniak,
Alan Shugart that started Seagate, the guys who started Sun Microsystems,
Nolan Bushnell that started Atari all showing up to compare thoughts and ideas
with little, tiny pieces of silicon on pieces of wood with wires that would eventually become what we know today as the modern-day microcomputer. Those silicon chips primarily came
from a handful of companies. Silicon Valley is called Silicon Valley
primarily because of this company. Fairchild Semiconductors is the root
of a lot of these things which you see, there’s sort of a family tree
of a bunch of companies that came out of it. Big companies like Intel,
or National, or AMD. LSI Logic, which is the startup I joined,
that was formed by the CEO of Fairchild when he wanted to
start a new company. I joined him, the company hit, and then, back to Jason Hsu’s talk about Taiwan as a source for innovation that can be important
at world scale. I came back here, at the
startup of this company. I wasn’t there for very long, but I helped the government
basically put together a little bit of a spreadsheet
plan for what became fab 1 at TSMC. I had no idea, honestly, that it would become
what it would become but when Alex, earlier today, asked if anybody
had a phone here, I’ll bet that 30% to 50% of the silicon in every one of your
phones was made at this company. It’s proof that people of Taiwan
can be important at world scale. That company also led to this. So, Alex referred to a time when I helped put together
some internet stuff over here. It was the first industrial scale,
commercial internet provider. There were little academic projects, like Hi-Net
and C-Net that I think are still in existence. I had a project in the USA,
where I funded a silicon company to make a chip you basically
would describe with a digital file a very big thing with a lot of data
and to get it made you would have to put it in a big tin can, like a movie reel,
fly it across the ocean, land at Taoyuan Airport drive a couple hours down the seashore to drop it off,
and at that point in time, which was around ’93,’94 the internet was just
starting to become usable. And there were FTP programs
and it just bothered me that it literally was a two day process
to get this file over on a mag tape. So instead I ended up
buying four routers and I ended up talking to what was then
Ministry of Post and Telecommunications, MPT that had a division called DGT,
which was their data division and over a period of
about a year and a half, convinced them to let me put routers
into the infrastructure of their phone company and setup a back haul to the United States and set up the first commercial, kind of big commercial, internet. And you’ll see I set it up here in Tiawan
its the first one on the list. That became an expansion point
for all the other countries that we set up. So over time, I ended up with a network
and you can see Taiwan is a little bit of regional hub but we set up internet in more than a dozen countries,
and then ended up building data centers in about 10 of them, that went public through
Goldman Sachs, Morgan Stanley, Salomon Brothers in 2000 as a data center company.
Those two things. So one of them was basically, in the silicon world, moving atoms around, physical things, silicon. Internet was about moving bits. Those two pieces together
lead us to where we are today. So Jason talked about this transformative thing,
Blockchain, Bitcoin, what have you, about ten years ago. Ten years ago in a month. Satoshi Nakamoto, if there is such a person, came out with a paper describing a peer to peer currency. Shortly after that, I was mining and being the hardware hacker that I am. This is my dining room. So over a period of time our house literally
became unusable because it was essentially because I had silicon background and data center background part of my house was a data center. That has become this so I thought it would be useful to
just show what a bitcoin mining data center looks like. I ended up funding a
company called Bitfury. It is one of the largest bitcoin mining operations in the world now and this is what a data center looks like. And this is actually what is sounds liked on the inside.
They are very loud. So what you see here is one
of our buildings in Iceland. This particular building burns about
10 million watts of electricity. We have three of those in Iceland and we have similar facilities in Norway, had one in Finland, Azerbaijan Republic of Georgia, and
a few other countries. And these things are basically the machines
that run specifically the bitcoin block chain. So you can think of these a little bit
like routers on the internet. So when you send an email, they basically
pass through a bunch of machines that are carrying that message
from point A to point B. Or when you look on
Google to get to a webpage those bits are basically flowing
going from one spot to another. Those machines there are basically tracking
the movement of every bitcoin. You know, so if Alex
sent a bitcoin to her then as it moves around it’s basically passed along
and written down in multiple places so that there’s a redundant database that can’t be erased.
So that can be used for transactions like a bitcoin. It can also be used for digital cats like CryptoKitties,
or pieces of electricity like Power Ledgers, or other tokens
like AirSwap. So there’s lots of different things that you can encapsulate in a digital envelope. Whether it’s a pieces of value, an identity,
a digital cat, or anything else. So its very transformational. So what were going from basically steering electrons
to steering information to steering assets. So when people talk about the value
of what Blockchain can bring. If you think about a magnificent,
wonderfully big company like Google which is basically organizing
the worlds information. Blockchain has the opportunity to
essentially organize the world’s assets. So if you think about the scale of what’s the value of all the worlds assets versus the pile of electricity it’s quite a large opportunity in front of us.
We’re right at the start. You can think of the transfer of assets
as the same thing that has happened over the entirety of
recorded human history. So if you want a perspective that is kind of interesting
for a look at the past. This is a wonderful book. This is a book by author Niall Ferguson, ‘The Ascent of Money’. And he basically traces the history of value exchange
in humanity back to the beginning. From pebbles and shells and feathers
all the way to credit default swaps. And as you read about
what people have used to transact value for thousands and thousands,
maybe hundreds of thousands of years you’ll find that what’s happening today with Blockchain and cryptocurrency is actually no different. It’s carried a little bit differently,
but it’s not that different. I’m gonna give
you an example. So what you see there is a
map of colonial United States. United States has been around
a couple hundred years. If you think about the
formation of the United States and as people got off their ships and walked
around the land and drew little lines around the forest to define states like New York and Virginia and Vermont or what have you. Typically those states
had some commonalities. Each of the members of the
states had a similar viewpoint. They were either religiously or language identified
and they were willing to trust and transact. Every single one of them came up with their own currency. And over time it united to the U.S. Dollar. but the U.S. Dollar is and interesting thing
because it’s a little bit of an anomaly. The U.S Dollar sort of exists today as a result of
what happened at the end of World War II. So picture the scenario where,
clock back 40-50 years all of the industrial nations
are wiped out except the USA. You have 100 million people milling about with nothing to do. They need to reconstruct, but with what? The nations that define the currencies of the past,
in certain cases like Germany, they didn’t exist anymore. So the Western Nations
basically got together and to give confidence said
“Here’s a piece of gold, you all know what that is.” We’re gonna abstract it, its not a bitcoin, but there’s gonna be 35 U.S. dollars to that ounce of gold. Each of these U.S. dollars you can
reference as a Mark or a Pound or Lira. Gentlemen, start your engines.
So it was all kind of subjective. The dollar got displaced from the
gold standard by the petrodollar. As we move forward into
the Industrial Revolution as productivity became one that
was based on oil because of machinery. Nations that had capital surplus
because they were productive could essentially secure their
productivity future by storing oil. But rather than storing oil
you would just store a dollar. So if you could accumulate U.S. dollars
because oil was transacted with dollars you could secure
your economic future. So we became a world of petrodollars in a very concentrated sense for this very short period of time,
literally of less than 100 years. So lets look at the 100 year
period that were in now, relative to the 400 thousand, 500 thousand, 300 hundred thousand, whatever the period of humanity has been or the civilized
humanity of several thousand years For most of that period humans didn’t live in
top down centralized structures. They didn’t work in top
down centralized structures. If you were a caveman, you might decide
in the morning to go pick berries with five friends. In the mid-morning you might
go fish with six others. In the evening you might
go hunt with seven others. So your job was a function of what you wanted to do,
when you wanted to do it, and it was inspiration based. Only for one and a half generation typically your parents and maybe part of the generation of their parents were companies organized in the
Industrial Revolution high capital intensity model. Where he who controls capital controlled
marginal economic productivity. So those that control the might
of the Industrial Revolution were able to take humans and commoditize them
and make them like little hamsters on wheels doing one function and promise them lifetime employment and promise them pensions for the rest of their lives. That’s turned out to be a fantasy
that maybe shouldn’t have ever existed. So I think we’ve gone through
a couple of generations where we thought civilization was
sort of like this and it step functioned into a new model that might
have just been a blimp. So now were basically going
back because of software where every one of you in the room here is like a molecule sitting on an extended fabric of humanity. You can virtualize, come off the page,
connect with other people of similar interests and become your
own virtual nation. I’ll close out with what Jason
talked about earlier today, about government
as a service, e-service. I think Blockchain is going to be bigger than
the silicon wave or kind of the internet wave. Both in kind of magnitude of what it’s transacting,
but also in the redefinition of society. If you think about what government should be,
it should be a service to the people. You’ll be able to basically have virtual nations
and Taiwan is a perfect example of that. There are so many overseas Chinese,
that are originally from Taiwan. You could effectively create a Blockchain base government system where it’s service to a virtual nation,
border less, independent. I live in America.I could still be a Taiwanese citizen
fully serviced by the E-services here. So I’ll just close with that were on the front
of a big transformational wave. So thank you very much for your time.


  1. Wow, every sentence is riddled with errors on the history of humans, the history of currencies, the history countries etc. Unbelievable number of GROSS mistakes

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