MicroStrategy is using Bitcoin cryptography to counter these AI threats - Michael Saylor (Pt. 3/3)

gitco News special coverage of Bitcoin

2023 is brought to you by coin payments

crypto payments made easy but in terms

of things that are threatening the

status quo have to bring up the idea of

AI and artificial intelligence because

that has been deemed as a potential

threat to the status quo what are your

thoughts there I know you've said that

uh a Bitcoin and encryption can be

useful in terms of AI and deep fakes if

you want to speak about that some more I

think we've um with all Technologies

there's a period where people experiment

with them without any material

commercial success and that can go on

for years like Google Glass came out a

decade ago and no one made any progress

on Google Glass apps for a decade so

sometimes you know people tried to fly

uh in the year 1500. you know and the

New York Times said flying machines will

be impossible like 60 days before the

Wright brothers figure out a flight so

you have these periods when things

aren't commercial I and then you have a

period where they become commercial and

I believe we crossed over into a

commercial Zone about a year ago Nai so

for the next decade you're going to see

ferocious Innovation and advances that

will be astounding Nai

and it represents both an extreme

opportunity for the human race profound

opportunity uh and an extreme threat for

the human race so we can talk for hours

about all the opportunities

um and and so I don't want to leave you

with the impression that I don't think

it's profoundly productive to the human

race I think it I think it could unleash

a brain power revolution in the same way

that internal combustion engines gave

you a horsepower Revolution a Roman

trirene with 300 rowers had 30

horsepower 2 000 years ago

and now any fisherman has 300 horsepower

so the fisherman is more powerful than

Julius Caesar that's the horsepower

Revolution that drives our cars and our

boats and our planes and it is profound

and it elevated civilization

the brain power revolution in a nutshell

is Michael Saylor has 2 000 people to

work for him and he pays 350 million

dollars for 2 000 brains

but you may get 2 000 brain powers and

you may pay nothing for it so what

happens when you launch your own company

with 2 000 AIS and they actually do 350

million dollars worth of work but you

don't pay 350 million dollars maybe

that's profound in the same way that 300

horsepower on a fishing boat is profound

instead of 3 000 slaves rowing right so

I I do think there's revolutions coming

everywhere

I think the threat

could be best articulated is this and

there's a million threats I'm going to

talk about two threats the threat in

cyberspace is I can spin up a hundred

million AI Bots to take over Twitter or

Noster or Instagram or Facebook or

Google and they're more intelligent than

I am and they're more charismatic than I

am and they work harder than I do

and that means that I could use those to

distort any kind of reality if I want to

be Katy Perry I can create Katy Perry I

can create 100 million of Katy Perry's

fans and I can create interesting choice

but yeah 50

000 Katy Perry super fans and it's all

just a fictitious Creation in AI land

because the cost to create an entity has

gone to zero okay

so that's a threat because now the

question is can you trust anything

unverified

anywhere that you hear

and my personal experience when I

encountered toxicity on Twitter

95 of the time the toxic comments

weren't coming from real human beings

they were coming from Bots that were

created by first generation bot programs

so imagine the third generation bot

program which is indistinguishable from

a person with a PhD

so uh and that part I could always tell

the first generation Bots because they

had bizarre names and they had like jpeg

images and they looked stupid

but the problem of third generation Bots

is they won't be distinguishable uh By

Any Human Being they will be more human

than a human

so the risk in cyberspace is I can spend

up a billion fake people and I can

create a Civil War by having the fake

Republicans hate on the fake Democrats

or the real Democrats having the fake

Democrats hate on the real Republicans

and having yeah the fake women hate on

the real men and having the fake men

hate on the real women until everybody

thinks everybody is disrespectful to

them and then we're and by the way maybe

this is happening now yeah maybe it just

happened with the first generation

technology and that's why we have the

cultural divides we have but imagine

when I can do it a million times cheaper

and better with the Next Generation

technology

I think that the implication is

we can no longer allow

people to create millions of accounts

yeah the the other day there were there

were probably 2 000 fake accounts that

followed me on Twitter

and one day

which means there's 750 000 fake people

following me on Twitter every year no no

I saw it

I literally saw in a matter of one hour

1500 bot accounts got scrubbed off my

account in one hour and they were bought

so we can no longer live with that

status quo so the issue is how are you

going to actually create Integrity in

cyberspace and I think the answer the

simple answer here is

you actually create a public private key

identity pair like they use on Noster

but then you have to you have to

actually inscribe it on the Bitcoin base

layer with a transaction so I determine

Michael Saylor Michael Saylor's public

key is this on the Bitcoin base layer I

published that

to the world's most immutable database

that's Immortal that's indestructible on

a transaction that cannot be interdicted

if I do that I've got an orange check it

might cost me a quarter once in my life

but now you've got an immutable identity

if you tie that to your Twitter identity

now if someone wants to launch a billion

Twitter Bots it's going to cost them a

billion transactions and that's going to

be a billion dollars a you end up with

uh with a cost to amount a billion a

billion uh repetition attack but B

if you become a fake person if you

generate 10 million fake people and I

catch you in my screen and I block you

it cost you a dollar or ten dollars or a

hundred dollars so

buy buy conjoining or by combining the

power of cryptography with the power of

of a decentralized crypto Network like

Bitcoin I can bring cost

and consequence into cyberspace

okay and I'll give you example of cost

and consequence in real space gravity

and friction

and if I take away the gravity you float

away and if I take away the friction you

can't walk across the carpet and so no

machine can work and the universe

without conservation thermodynamics

gravitational laws Etc no machine can

work in cyberspace without the same

thing and so I think that the AIS have

just taken us to the to the Natural

conclusion which is

cyberspace suffers from toxicity and in

the absence of a cost of a thermodynamic

cost to do something

you can't you cannot trust the thing you

see and so it's inevitable

that we're going to actually introduce

this idea of a cryptographic

verification

and once I've done it then I can

digitally sign every document and if I

if I this interview with you and I will

finish it

how do you post it to 10 different

platforms and sign it because if you

post it to Twitter

you might be able to sign it with a gold

check yeah it's going to cost you a

thousand dollars a month and twelve

thousand dollars a year to have a

verification sitting in a centralized

database Twitter and it won't work on

Facebook Google YouTube Snapchat

Tick Tock iMessage and Telegram and read

it so if you wanted to have a universal

Authentication

you would create an orange check

and you would actually burn the orange

check in the blockchain into bitcoin's

blockchain you would publish it to

Twitter and Tick Tock and Instagram and

iMessage and you would tell everybody if

you get a message from me or you see

work of mine it needs to be signed with

this orange check identity

and if you did that then you would have

some defense when I spin up an AI

because you know my AI can copy you copy

me and create 10 000 hours of interviews

of the two of us where you say anything

I want you to say and I say anything the

you know the robot Master wants me to

say and it will look just as good or

better than this interview

right and the issue is how can I tell

the difference between the fake and the

real and the answer is only with a

cryptographic proof that's

thermodynamically sound

and is that a technology that's uh being

developed I mean you spoke about Twitter

I I know you've had uh contact with Elon

Musk is this a conversation that perhaps

you've had microstrategies working on a

project in this area where we want to we

want to

um plug

Bitcoins security this the cryptographic

security and to Enterprise security of

any Corporation

and I know that block has projects on

decentralized identity where they're

studying how you how you can blend

cryptographic Security

in the modern world in a decentralized

way that relies upon an open

permissionless protocol like a Bitcoin

so I think there are a lot of people

that are looking at this right now and

I think I think you'll see people

focused on it a lot more over the next

24 to 36 months as they see the threat

coming from uh the new AI Bots

is this an idea you've run by Elon Musk

seeing as you mentioned Twitter and Bots

and the problems that that presents I

have on occasion tweeted to Elon that he

should adopt the orange check in order

to provide uh integrity and Security in

Twitter

and he's adopted the gold check and he's

adopted uh some of the blue checks and a

few and Blackjack but we haven't quite

gotten the orange check yet

I'm Gonna Keep tweeting on him or

talking to him behind and that is

something that microstrategy is is

actively pursuing in in terms of the

technology behind this

yeah I mean there's no reason to wait

for someone to save you save yourself

yeah all right so right we're gonna do

it and if someone copies us and they do

it better that's fine

and if no one does it then we'll put out

our version of it and then I I believe

it's a good idea

and you just have to have that aha

moment here's the moment when when your

friends call you and say they were

approached by you and they wired their

life savings to invest in something and

you realize it's gone and then you

realize you were just spoofed or fished

on a what's up Channel or whatever and

it makes you angry you're gonna think I

need a better way so that 50 times a

week scammers and Fishers and criminals

don't impersonate me in cyberspace

I I have two firms and I'm sure I spend

hundreds of thousands if not millions of

dollars a year simply deleting

impersonators and scammers in cyberspace

yeah and there's a hundred a week

and and every single week that goes by

someone says to me oh yeah

um

I heard about this great trading idea

I'm like that's not me that's not me and

again like you mentioned with the Deep

fake videos obviously this can have

tremendous political implications if you

can alter a video of a world leader to

say something and it's so realistic that

uh you know action may be taken based on

on videos of people of power and

consequences seemingly saying something

so certainly a role for the the orange

check mark there in the interest of

national and International Security

yeah and I think it's a good a good uh

point to make

to make um

or to offer this very big idea

the idea is

if your ocean fairing people living on

an island and if you don't have sea

power in the form of a Navy you will

starve to death and that's what almost

happened to Britain many times in its

history

well after the airplane if you lose

control of your airspace you will be

bombed back to the Stone Age and Germany

got firebomb that's why they lost World

War II and within the first 48 Hours of

the first Gulf War the Iraqis lost

control of their airspace and they lost

the war and no modern nation-state can

exist losing control of its airspace

and now we're we're faced with this

issue of who controls your cyberspace

and I would say cyberspace is in chaos

right now uh you can't trust anything

you see across so many of the social

networks and if you could what are you

going to do when I launch a hundred

billion fake people into your cyberspace

I'm going to corrupt and toxically

destroy all your messaging it's like a

denial of service attack on your

networks and you're not going to be able

to tell what's truthful and what's not

truthful you don't even know what people

think

see all those people on Twitter and Elon

runs a poll and everybody says oh well

how many Bots voted in the poll

if you lose control of your cyberspace

you can't exist as a Modern Nation

and so Bitcoin is secure

because it is the most powerful Cyber

Network Bitcoin has 350X a hash and that

extra hash is in essence 5 million

Bitcoin miners backed by 15 gigawatts of

energy and 15 gigawatts of energy is

more energy than the US Navy runs on

and if you wanted to if you wanted to

interrupt the network if you wanted to

stop me from sending a message or doing

a transaction on the network over the

course of eight hours you have to come

up with three thousand extra hash and

that's going to cost you about 10 years

and about 100 billion dollars

yeah there's a lot of work and a lot of

money

this network is a fault tolerant

military-grade communication Network

it's it is nation state resistant

and if you want your uh other cyber

networks if you want all your social

media networks if you want your websites

to be resistant to a nation-state attack

by Bots you're going to need digital

power

and the power of Bitcoin is such that if

an AI took over all the computers in the

world if it took over everybody's iPhone

if it took over all the Google all the

Google computers all the Amazon

computers all the Microsoft computers

and it turned them all

to attack the Bitcoin Network it

couldn't stop that message it might slow

it down by 10 percent

and so you start to see the logic of

Satoshi and you and what real digital

power is is to be able to stand against

a nation-state attack of all the

computers that a nation can Marshal

against you if you have that kind of

cyber security

you can actually defend your entire

civilization you can defend your money

transfers your banking Network your your

news networks your social media networks

against a hostile attack and right now

you could argue that most of the

problems we have in our world are are

because those social networks are in

chaos right the massive debate right now

is misinformation and we can't agree on

whether or not the person that posted

the thing is even a person

remember the Russian intelligence thing

is it Russian intelligence is it Chinese

intelligence is it North Korean

intelligence or is it a real person the

real lives in the real country and

nobody knows

so I I think

people are going to start to become

aware because the AI threat that you

need cyber power and and there's no

shortcut to cyberpower there's no simple

trick like this idea of Noster Noster

was I'm going to create my own public

private key combination and I can post

anything I want and nobody can stop it

good idea but the problem is I can

create a billion Noster Bots

and so there's there's no solution to

the problem that doesn't include digital

power or proof of work which is the

basis of the Bitcoin Network

if you're not converting

gigawatts of electricity

into exahash

you don't have power

if you don't have power it's like you

have no Navy you have no Air Force

you're getting bombed back to the Stone

Age and it's inevitable and so any

nation state that wishes to maintain its

sovereignty in the 21st century is going

to have to be able to control its

cyberspace and Bitcoin is the key to

that because it is the most powerful and

perhaps the only truly secure Cyber

Network in the world right now

well in terms of proof of work what does

that mean with regards to the idea of

mining because

uh the Biden Administration for example

wants to put a 30 tax on Bitcoin mining

under the guise of for under the idea of

it not being environmentally sound and I

know that's a conversation we've had

before and I know because of the idea of

the mining that's required for the proof

of work to maintain uh the blockchain

you came up with the Bitcoin mining

Council to address the environmental

concerns where do you think stand with

that

um well I you know first of all the if

the administration proposed a 30 tax on

data centers and Google and Facebook

announced they're moving their data

sentence to China everybody would have a

cow

when they realize that that it's a

national security threat to lose the

digital mining the Bitcoin mining

business in the United States I think uh

the people in the dod will will actually

put a spike in it

um I don't think there's any bipartisan

support the Democrats on Capitol Hill

the Republic's on Capital won't be in

favor of it so I think it'll get killed

on Capitol Hill

I think the most important thing is to

understand that a Bitcoin miner is a

digital Power Center

and so what you're talking about is

eliminating the digital power industry

from your own country and when they

think about it a bit they'll realize

that then that goes to a country that

they like less than the US and you

wouldn't you know you wouldn't want all

your aircraft and all your ships to move

to the countries that you don't like so

I don't think it'll happen

um I obviously I think it's no more

intelligent than driving the data center

business or the electricity business out

of the US right there they're both not

good ideas

occasionally things like this get

floated mostly their guerrilla marketing

activities by Notting kind competitors

someone else that is threatened by

Bitcoin wants to weaponize the political

process of the tax process to undermine

a competitor

and they insert that in a friendly

politician's ear but I think that they

will die on Capitol Hill that's a good

reason well speaking of uh Mining and

the miners obviously the idea of

ordinals has brought some debate there

uh with the mining power that's uh

required for ordinals which for our

viewers is an nft inscribed in the

Satoshi which is the smallest

denominator of a Bitcoin that's blocked

up uh the blockchain you've said that

you see ordinals as a catalyst for

Bitcoin adoption although some would

argue that it's contrary to or detract

from The Sound money arguments of

Bitcoin and that uh the the because the

transaction fees are so high and it's

more correctly if I'm wrong profitable

for a minor uh to work with the

inscription of uh of an ordinal than it

is to facilitate a a Bitcoin uh

traditional transaction it May detract

from again the original Mission of

Bitcoin let's start with the big picture

um people in the crypto ecosystem are

losing faith in every crypto asset

except Bitcoin and the capital is

Flowing from the other crypto assets to

bitcoin The Regulators are attacking

every crypto exchange every defy

exchange every crypto token every

cryptocurrency except Bitcoin if you

read 10 000 pages of hostile regulatory

action the word that's conspicuously

missing is Bitcoin Bitcoin is actually

the low risk asset it's the ethical

asset all this crypto development effort

that was taking place on the other

cryptos

um I think all the developers realize

that that when the dust settles the only

Network that's still going to be around

the old the the low risk Network that is

least likely to be stopped by The

Regulators is Bitcoin so if you're going

to build on something you want to build

on a a network that is the most secure

politically and the most secure

technically if you're going to use if

you're going to run on gas

if the gas is an unregistered security

is it Securities fraud okay it's illegal

it's unethical you're going to jail okay

so so using gas that's a token that's

deemed an unregistered security is an

ethical lapse so what you see here with

ordinals and inscriptions is you see

intelligent developers saying who's the

winner Bitcoin what's the ethical

Network Bitcoin which one is least

likely to get me shut down Bitcoin which

one is technically most sound Bitcoin so

what did I do I did all these other

things well can I do them on bitcoin

sure I can

and if I'm doing them on bitcoin then I

have a reasonable chance

of of Commercial Success right like if

you burn a monkey jpeg

and you burn it on an unregistered

security and you're wash trading the

unregistered security okay it's

unethical and it's also stupid

if you burn it on bitcoin it just may be

stupid but it's not unethical or illegal

so so I'm not here to endorse ordinals

or any particular yeah I'm not a crypto

dick but person like I'm not gonna

support you know or promote that sort of

thing

um however

the bigger idea is what if I could burn

a hash attach it to a Satoshi or what if

I could inscribe any piece of rare data

and I could put it onto the blockchain

forever

while there are certain types of

messages that I would want to send where

no one could stop them if I needed to

get a message from point A to point B in

the middle of a war

and I was being denial of service

attacked and I wanted a network that

could actually overcome a nation-state

attempting to stop me from saying the

message

Bitcoin is the way to send the message

if you want a billion dollar document

I have a will it's got a billion dollars

in it I basically sign it 30 pages I

create the document

um and then I put it in a vault and 35

years from now some lawyer takes it out

and they change oh a few words and they

just redirect all the money to someone

else and nobody knows

the Witnesses are dead the notary is

dead

how do you make the world tamper-proof

while the answer is simple as I take the

will I hash the Will I burn the hash on

the Bitcoin block should I say Michael

Saylor you know inscribed as will on

this date there's the hash code and then

I tell my heirs and my lawyers and the

entire general public

there's the hash the will comes out they

hash the will doesn't match the hash if

it does match the Hass then that's

probably the will and if it doesn't

match the Hass then whoever's trying to

defraud the general public is not going

to get away with it so there are ethical

economically sound reasons to burn hash

or burn a time stamp into the blockchain

corporate resolutions are a simple

example companies make resolutions all

the time that they keep secret from the

general public but have billion dollar

impacts and 10 years from now they have

to prove that they made the resolution

and Stamp It

right now a lot of those documents are

burned into DocuSign or some proprietary

database that may be run by some company

you've never heard of and maybe they

will tamper with it maybe they won't

tamper with it and you will never know

so

I think that there are

there will be a hundred thousand

different applications launched

and 99 of them won't be very you won't

like them

and maybe they won't be good but I've

lived long enough to see lots of ideas I

didn't like be successful and I've lived

long enough to know that point one

percent will be screamingly successful

so my view on on uh ordinals and

inscriptions is

you can criticize but you shouldn't

censor

the protocol is what we should be

fighting over and and the protocol is is

and a protocol where anybody can own

Bitcoin

and anyone can engage in transactions as

long as they stick to the rules

and then the free market suggests that

over the next 30 Years billions of

people are going to do millions or tens

of millions or billions of things and

they're going to interact with each

other in some outcome which is

unexpected but good for all of us will

take place

if the free market is allowed to

function

and uh if people come up with silly

things to burn on the blockchain and no

one wants to buy that thing they'll fail

and when they come up with something

that's worth a billion dollars they'll

pay for it and it will ultimately be

good for Bitcoin and will be good for

the world because

you either believe in Freedom

and and uh believe in allowing people to

do things that that are good for the

world based on subjective judgment

that's the Austrian Economist I believe

some free markets or you believe in

central planning and you think that one

God King should make the decision for

you and you shouldn't have any freedom

and I think the Bitcoin community and

the Bitcoin protocol is based on this

idea that we should have rules without

rules

we should Elevate the protocol first

and uh and then people can bid on

whatever transaction they want to do

and you will see you'll see a hundred

thousand applications on the layer two

and the layer three and they will

succeed and fail progressively as the

free market constructs and deconstructs

ideas and for every problem someone

points out on the base layer like oh the

Tran you know the transactions cost 27

instead of one dollar there will be

another free market actor like Jack

Dorsey that will create a cash app that

will solve the problem 27 can be

transferred instantly for nothing or a

lightning wallet twenty seven dollars

could be transacted in two seconds for a

30th of a penny

and that thing that you fear transaction

fees going up is actually going to drive

billions of dollars of investment in the

layer two in the layer threes that solve

the problem and so instead of second

guessing it we should just sit back and

let the free market solve the problem

because your problem is my opportunity

necessity is the mother of invention and

speaking of opportunities very quickly

you mentioned lightning if you could as

a final thought just tell us what

microstrategy is doing with lightning

um

we wanted to create a product that would

allow all of our customers to offer

lightning Rewards or Bitcoin based

rewards to their prospects customers

partners and employees

so the idea is a module that you simply

plug it in and in one afternoon you

could

light it up such that or turn it on and

integrate it with your corporate

directory so that all 500 000 of your

employees have a Bitcoin wallet and all

50 million of your customer accounts

have a Bitcoin wallet

and all 500 000 of your employee emails

or lightning addresses

and all of your customer accounts can

have a lightning address which is their

account name at your brand like sailor

mikey.com whatever

and then we give them some simple tools

where

they can build rules where every time a

customer logs into their website and

posts the product review they get a

Satoshi reward and if you apply for a

credit card you get a Satoshi reward and

if you refer a friend you get a Satoshi

reward

and if you read a book you get a Satoshi

reward if you write a book review and

people like the book review you get a

Satoshi reward so you could gamify any

engagement with a prospect with a

customer

every time your employees fill out their

employee survey they get a Satoshi

reward when they show up to meetings on

time they get a Satoshi reward when I

log into Zoom meetings if I'm one minute

late I don't get satoshi's but if I log

in on time I get satoshi's and believe

it or not it makes a difference I don't

want to be late because satoshi's are a

dopamine hit and you get them instantly

in real time friction free

and when you're ready to withdraw them

you simply

withdraw the lightning address or you

scan with your lightning wallet and it

just leaps off of the the Bitcoin wallet

that the company created to your own

personal wallet

right so

the bucket of money we're chasing after

is companies give billions of dollars to

their employees in compensation

incentive come and then companies spend

hundreds of billions of dollars on

digital advertising and they give it to

the Googles and the Facebooks of the

world

so if you're Coca-Cola instead of giving

spending 50 million dollars on

Advertising to drive people to your

website or download your mobile app or

whatever you're trying to do

why don't you just give the money

directly to your customers

and cut out the ad agent and cut out the

middle person and and of course like we

don't really need a hundred billion

dollars worth of banner ads and spam ads

wouldn't it be better if a company just

said if Amazon said if you read the

books we'll give you money and if you

post reviews we'll give you money and if

you send a friend to our website we'll

give you money and we'll give them money

and everybody just gets money and if

they show up and and they don't buy

anything from us they get to keep the

money and and that is not practical with

credit cards today because there's a

minimum two dollar fifty cent the five

dollar transaction because you have to

get doxed and a credit card

because after you move the money 40

times on a credit card the bank took it

all in transaction fees and because

final settlement is 45 days on a credit

card so how do you actually do micro

payments instantly friction free at no

cost with a credit card

so so lightning and satoshi's represent

an opportunity for you to change the way

you think about marketing or employee

incentives

and uh we're thinking we're doing it

because

we spent 30 years building customer

relationships with all these Brands like

the Disney's and the Nikes and the

Starbucks of the world and the big Banks

and the Airlines and the hotel chains

and uh we've already got

a big sales force in 27 countries we've

already got thousands of services people

we've already got an army of lawyers and

accountants and we've already got

enterprise software agreements with all

of them that it would take you billions

of dollars in 10 years to basically

duplicate what we've already got so we

just take this one simple idea we plug

it into our distribution Channel

and hopefully we can convert over tons

of big Brands into taking their

marketing budget and buying Bitcoin and

giving it away to their customers and

Prospects right and of course it also

serves the purpose of further adoption

of Bitcoin hyper bitcoinization at some

point Michael

so many nuggets here thank you so much

I've really appreciated your insights on

a range of topics we're gonna have to

leave it there but really appreciate it

you're right you did not lost me

um but thank you so much Michael sale

always a pleasure chatting to you and I

look forward to seeing you at the next

Bitcoin conference yeah thanks for the

opportunity okay thank you and as always

thank you for watching I'm Michelle

mccorry keep it right here jetco News

special coverage of Bitcoin 2023 is

brought to you by coin payments crypto

payments made easy