>> a quick check on the stories we are tracking today. an advisor for the u.k. government says hi covid death rates are history. university professor john bell said the average length of a hospital stay is down to three days. u.k. infections have jumped by more than a quarter million in the past week but the government says it will not tighten restrictions. and the seven day average of new

cases has dropped about 18% from its january high but hospital cases are about half the january peak. the new york city mayor said the city will double pcr testing in schools when students return in january. the pboc governor said china's financial system is stable overall. in an interview, he said market expectations are gradually improving. he did not name any specific developers. he said they will issue the first batch of carbon go funding by year-end. cathie wood is missing out on the urine rally on wall street. -- missing out on the year end rally on wall street. the famous technology fund is now down 23%, heading for the

worst annual performance since its inception in 2014. apple is said to have awarded unusual and significant stock bonuses to some engineers in a bid to retain talent. sources tell us the staff found out last week about the bonuses worth up to $180,000. they're being issued as stock units which vest over four years. let's take a look at markets, starting with the u.s., the s&p up after yesterday's rally. the naz net -- nasdaq down more than .5%. apple dragging the nasdaq lower. commodity related stocks the major driver on the golden dragon index.

the two year yield up another five basis points from the front end of the curve. 10 year yield steady, crude oil continuing higher surging to $76 a barrel. australia and new zealand back online today after a break. this is bloomberg. >> from the heart of where innovation, money, and power collide, in silicon valley and beyond, this is "bloomberg technology." ♪ emily: i'm emily chang in san francisco and this is "bloomberg technology." of the next 30 minutes were on one of the tech topics of the year, that is crypto. we'll talk about it with michael, who now owns more

bitcoin than any other company in the world. plus, the first coin etf, a milestone for the industry. talk to the company behind that move. and non-fungible tokens stage a resurgence after fading from the headlines during bitcoins springtime suite. first, bitcoin, after starting the year at just above 18,000. who better to talk to a bout all -- about all that volatility than michael, who owns the biggest pile of bitcoins yet. take a listen. >> we are getting a lot of attention from investors. we appreciate that. i think microstrategy is a leveraged, long bitcoin play. investors are trying to evaluate

how to separate the two businesses and our growth prospects in either. our strategy with bitcoin is we acquire bitcoin, when we think the market timing is right. it has worked out pretty well for the past 12 months. we've got of -- about 3.1 billion dollars in bitcoin and my position is worth more than $7 billion right now so i'm pretty pleased with the way the macro trend is working. emily: let's talk about the macro bitcoin trend. what do you read into it? michael: it's all bullish. you've got great statements coming out of the senate, great support from congress and great support from the regulators. you've got to etf's coming online. we read today about etf's coming online in australia. the eta -- etf actions, all the regulatory clarity is going to

be really good for bitcoin. emily: there is still no spot etf, and that depends on gary gensler. how much does it matter? michael: i think everybody is perplexed that we're a little late with this, but i think the writing is on the wall. with 40 different etf applications in place, and in time i think over the next 12 months, we will see more and more etf's and more options, if the spot etf comes to the market, it will be really good for bitcoin in general and everybody involved in the bitcoin ecosystem. emily: looking into robinhood results, crypto trading dropped almost 80%. it was kind of astonishing, i spoke with the cfo who told me perhaps crypto trading had normalized. i'm wondering what you make of that huge change in volume. i wonder if it signal something

about broader interest or hype around cryptocurrency. michael: i think we have ebbs and flows and its natural cyclicality of it. i think q1 was a pretty good quarter. it's slow down after the china exodus and their heating up right now, you can tell with all the chatter about the various coins. i don't think we've seen the last of crypto volatility and crypto enthusiasm. i think that in time we are going to see more. emily: so you think more volatility is ahead? michael: i think this is the most exciting thing going on. the entire crypto world is attracting a huge amount of capital. it is attracting a huge amount of talent and a huge amount of attention. on saturday afternoon, what else

is there to talk about? the bond market, the equity market is closed. crypto is moving, crypto is changing, twitter is on fire and youtube is working. i just think it is tailor-made asset class for the 21st century. emily: what do you want to see when it comes to stable coin regulation? michael: i think the united states has the ability to make the u.s. dollar the world reserve digital currency. and there is enormous demand for dollars and south america and asia. there's at least 6 billion people, maybe 8 billion people who like to get their hands on dollars. it's clear that the best chance of that is something like a tether or circle. there's like 100 billion dollars circulating between those two coins right now. i think the entire market is waiting for regulatory clarity. when they get clarity, it's possible for these kind of

private coins to grow by a factor of 10 to 100. we could see -- we could see a trillion dollars up to $10 trillion. it would be good for the united states world reserve currency status and it would move the state of technology forward by leaps and bounds. emily: your thought on chips in particular, people thought it was a joke, and who is laughing now? michael: there's different segments of the market. there is the savers, there's the technology funds, they want to invest in the next nft platform, and then there's the speculators and the entertainers and they will have their meme coin. everybody has got their thing. it's all part of the crypto world right now. it is what makes it so interesting and exciting.

i don't think this will be the last one. emily: how would you compare it to doge? michael: i stay in my lane, emily. [laughter] bitcoin is my lane. emily: let's talk about your bitcoin lane. we've seen a massive crackdown, we're expecting waves from that shock to impact the bitcoin ecosystem here in the united states. one of the interesting things we've been talking about is the talent flow out of cryptocurrency companies because u.s. regulation has remained -- there are draws to big tech and other companies that have potentially more certainty. do you think that will have a negative impact on this industry and the enthusiasm that we've seen over the last couple of years? michael: i think the china

crackdown was the best thing that ever happened to bitcoin because the entire bitcoin mining business moved from china to the u.s. in the u.s. became the world leader in bitcoin mining. so i think that was a good thing. in fact, regulatory certainty became clearer for bitcoin, and the crypto world outside of bitcoin is waiting for clarity on security tokens. on the other hand, the bitcoin world is all about digital property we got that clarity. it was support for bitcoin from the senate and congress and regulators, and the acknowledgment that bitcoin is digital property and part of the western technology stack. it's ongoing -- it's going to be critical to the support and spread of the american values and western technology, just like the english language, just like the u.s. dollar, just like google and amazon and facebook and microsoft.

so that china crackdown was a good thing for bitcoin. emily: michael saylor, cofounder of microstrategy. this is bloomberg. ♪

emily: 2021 march the year the first bitcoin etf and the opening of the floodgates to institutional investors. here is a conversation with my colleague. >> we are really excited to bring the ipo, the first bitcoin linked etf to investors as an important opportunity for them

conveniently to invest in bitcoin in their regular brokerage account. in the regulated futures market and in a plain old etf wrapper. so we think this is fort many people who been waiting for an easy and robust way to do this to now be involved and have it in their portfolios. >> do you think the average investor is going to understand the difference between a cash settled futures etf and etf based on the underlying -- this is going to come with costs. do you think the investor you're talking about, is this the right product for them? >> we want them to understand. we think there are some key advantages. there have been a growing group of experts who have been writing that the futures market is one of the best places for price discovery in bitcoin. in credit default swaps, you

reflect price more quickly than cash bonds. there is tremendous volume here as well. the futures market trades 40% more volume than the largest u.s. bitcoin exchange. it's not a second order choice. some etf futures have gotten into trouble, particularly when you have to roll over some of the futures contracts. did you guys structure it in any way that kind of helped that issue? >> we are focused on the front months because that has historically had very good tracking. to contextualize that, in the month of september, the average between that near month and the next month contract on any given day was about 20 basis points. that would annualize to about 2.5% just favorable to lots of other ways to get exposure.

running the futures-based approach to bitcoin that we launched in july, and through last friday as an example, the bitcoin reference rate that amalgamate's a few exchange prices was up 51%. our mutual fund, running the future strategy was up 52. we really do think this is a first-class way to have exposure to bitcoin in addition to being a convenient way. >> do you think most people that use it are going to be using it for price action? they are traitors rather than investors. a lot of people --traders rather than investors. they like the volatility and price action. you are building a perfect vehicle for them. why do they need bitcoin when they've got you, and if they've

got you, is there a danger that the -- that it becomes negative as a result of that? >> a couple of key points to make. this will absolutely be a vehicle that will will be attractive to folks who will use it longer-term in their portfolio, but also to the trading community. this is an important and valuable feature of the etf market. think about this. you buy and hold this for whatever it may be, 3, 6, 12, 9, 24, 36 months. one day you need to monetize it and you will be really happy there aretraders involved to make sure the trading is really efficient. it's a landmark that will bring even more liquidity to the marketplace in the evolution and maturation of it. emily: not all investors rushed to the new etf. take a listen to why cathie wood

did not buy in, at least not just yet. >> we are looking at this very carefully. we would like to understand more . not yet. emily: they launch their own, they plan to invest in futures contracts for bitcoin and is on the chicago mercantile exchange. coming up, the nft phenomenon. how valuable can they possibly be? we will discuss, next. this is bloomberg. ♪

emily: in 2020 one, bitcoin hit a high of $57,000. all anyone talked about were in fts, or nonfungible tokens. with a college dictionary even declaring nft its word of the year. we spoke to the ceo about it all. >> it's really exciting time for in fts. from our perspective, if you rewind, in fts have been around since 2017. the recent surge is an accumulation of a lot of hard work from a lot of companies in the space, a lot of infrastructure being built around in fts. now there is really a lot more for consumers to go and dig into in the nft space. there's art, collectibles,

gaming, virtual worlds. there's so much activity in so much momentum around it. people are waking up to the fact that there is a whole new digital economy emerging around artists, creators, musicians, that allows them to sell individual assets directly to their fans and directly to the people who want to engage with these products. it's an exciting time for the space. we've seen tremendous growth of the market over the last 12 months. emily: so we are at a point where you can own a piece of a song. do you see owning a piece of a movie, or a popular sports space? do you see that going mainstream on a broad scale? >> i definitely do. there are opportunities for everyone here. gamers know how valuable digital content is within the context of games. artists have been looking for ways to engage more effectively with their fans.

musicians, athletes, there's opportunity for everyone. there are evens spaces for those outside the art space. people are trading event tickets as in fts. it's a broad ranging technology. it is just in the early days being explored, and the sky is the limit. emily: how do we know for sure these are actually going to be worth something someday? >> at the end of the day, it is all supply and demand. if you're buying and nft, you should think about it as something that is a collectible, something you want to own just to own it. you should look at the market dynamics over time, do your own research. there is no guarantee that every nft is going to be worth something.

there's no guarantee the beanie baby you buy is going to be a rare collectible that someone wants to buy in the future. but there is an opportunity to own digital content here and it is early days in the space. emily: meantime the nba and draftkings are launching their own marketplace. talk about the competition and where opensea fits in. >> we think there will be tons of opportunity comment on the blockchain, tons of opportunities and tons of artists. we've envisioned it as the amazon type marketplace. you can find whatever you are looking for and then resell it. there is peer-to-peer trading of a lot of content launch outside ofs openea and there are -- there's really broad coverage. we trade event tickets, domain names, it's a one stop shop and we aim to make it the best user

experience in terms of marketplace and also the best place for new people who are still learning about the space but really want to explore and just get a taste of it before really sinking their teeth in. emily: talk about transit -- transaction costs on the block change. is there more that you would like to see? >> we are seeing an explosion of innovation in the underlying leaders for nft in the blockchain layer's that power the technology. upgrades to ethereum have provided more stability. we've launched our cross blockchain support so we now support it theory on and others like polygon to allow for a lower cost environment. this is supercritical because if you are paying adoption cost to buy something, it limits the types of things you can

purchase. it's hard to buy something for only $10 if you are paying a $30 fee on top of that. moving to new technologies are vital for getting this technology to be adopted by a more mainstream customer. we are excited about the polygon launch we did recently, which is a solid step in that direction. emily: what are your favorite in fts? >> i'm excited about gaming and metaverse. there is a virtual world where you can own virtual land, you can build museums, it's a lot like minecraft. i think it's going to be a weird intersection between gaming, art, and collectibles. we're spending more time in these systems and building out a

really unique experience. i'm excited about projects that take it to the next level and build really engaging environments to display your in fts. -- nfts. i have to give a shout out to some of the collectible projects on the stream. i'm a federal -- i'm a fan of all the interpretations happening in the space. emily: the question now, just how much of a roller coaster will next year and nfts be? >> coming up next, you don't want to miss it. stay with us. ♪

vonnie: daily covid infections in new south wales have soared to 11,000, almost double previous records. australia's second most populous state reported 3700 cases. there are reports some states are considering shorter isolation times as the country focuses on living with the virus. hong kong will mandate three-day hotel quarantines for air cargo crew as it steps up adverts to stop any omicron transmission.

officials did not provide a start date which are being considered for regular aircrew. an advisor to the u.k. government says high covid deaths rates are history because omicron causes less severe history. -- illness. the oxford university professor said the average length of a hospital stay is down to three days. u.s. junk bonds have returned 2% in december beating most other areas of the fixed income market. if the biggest monthly return in over a year for risky u.s. debt. junk bonds are set to fall below 4%, levels not seen in september. new zealand is trading, the benchmark -- australia is pointing to a higher open. japan futures trading down, but slightly. don't forget, 1.4% gain.

the gain in south korea, kospi futures points to a higher future. we will be tracking the market across asia today. this is bloomberg. ♪ ♪ emily: he was born in russia, emigrated to canada with his parents at the age of six, and had already mastered multiple languages, mathematics, and engineering by the time he got to high school. at age 17, his father introduced him to bitcoin. he couldn't afford to buy it, so he wrote about it instead. and while he found bitcoin fascinating, he felt like he had an even better idea. in 2013, vitalik buterin wrote

the original white paper that conceived ethereum, not just a digital currency, but an entire network built on the blockchain. it is now worth more than $300 billion, and the biggest believers claim it will send the rest of the cryptocurrency market into the ether. joining me on this edition of "bloomberg studio 1.0," the inventor of ethereum, vitalik buterin. we are going to talk about ethereum, but i want to start first with how you got here. you were born in russia, you emigrated to canada with your parents when you were just six years old, and you started learning about bitcoin from your father. what was it about bitcoin that hooked you both? vitalik: bitcoin is really interesting because of how interdisciplinary it is. i was very interested in math and computer programming and cryptography and technology. i was also very interested in economics and politics and

philosophy, and bitcoin just happens to be this, like, interesting fusion of all of these things, right? and, at the same time, it is not just a piece of code that is there for fun, it is not even just an app. like, it is something that is really intended to have a very big and meaningful impact on how the world works. and so, i think just having both of those aspects together definitely made bitcoin very interesting for both me and my dad. emily: as i understand it, you did not have enough money to mine, so you wrote about it instead. and in 2013, you wrote the original white paper that became the basis for ethereum. what was it that sparked that original vision? vitalik: so, i joined the bitcoin space in early 2011, and i wrote that ethereum white paper at the end of 2013. that was the time when things first blew up and it was clear that this was something of significance. i remember going to the bitcoin conference in san jose, which had about 1000 people in it, and that was when i realized that, like, hey, this is not just a bunch of weirdos who only exist on the internet, like, this is

real. there are people actually trying to do things, there's people building businesses, a lot of which are actually pretty successful. what started happening then was people started thinking, well, we have bitcoin. what next? so, what else can you do with blockchains? like, what would bitcoin 2.0 or cryptocurrency 2.0 look like? emily: as i understand it, it wants to be a whole new operating system, like a new apple ios, with a ton of apps built on top of the blockchain. in the simplest terms, what is ethereum, and how is it different from bitcoin? vitalik: so, bitcoin is a blockchain that is designed for one application, right, which is maintaining and letting people use bitcoin, the currency. ethereum is a general-purpose blockchain. so, instead of being a blockchain that is designed for one application, ethereum is a blockchain that supports a built-in programming language. and whatever blockchain application you want to build,

you can just write the logic of that application in the programming language, upload that program to the chain, and this becomes what we call a smart contract, and anyone can then interact with your application, and the blockchain interprets the rules of your application for you. so, instead of being something that is designed to do one thing, it is designed to open up space for creativity and to basically let people do whatever thing that they want to do on top of it. emily: so, is the idea then that the next facebook or twitter would not be owned by a jack dorsey or mark zuckerberg, but be built on the blockchain and owned by everyone? vitalik: there are multiple projects already trying to do that, and lots of them are based on ethereum. so, yes. emily: so then, is ethereum a threat to established, centralized companies and social networks like facebook, like twitter, like google? vitalik: i think it can be a

threat, but it can also be an opportunity. like, i think even jack dorsey himself, right, he has a project called blue sky, which is trying to figure out how twitter can incorporate decentralized elements. and i think a lot of these projects want to actually do this, right? because i think a lot of them are realizing that being a kind of centralized focus of power and having control of so much of everyone's data and all of these things, like, it is not just an asset, it can also be a liability as well. emily: now, we still don't know who satoshi nakamoto is, whether that is even a single person or a group of people. what is it like to be a known and visible figure behind such a popular technology? vitalik: i mean, there's definitely times when i want to be less visible, but i guess

that comes with the territory. emily: why do you want to be less visible? i mean, one of the other ethereum co-founders, anthony di lorio, recently announced he is quitting crypto because of safety concerns. i mean, is that part of your concern as well? vitalik: i mean, it is not so much physical safety, per se, as much as wanting the ability to also have a life and not just have like random people running up and saying, "are you the vitalik buterin?" i don't know. there's definitely times when i find such things annoying. i don't know, i am likely to keep wearing my mask in lots of places and that has nothing to do with covid. emily: there was a lot of debate early on about what ethereum could be, would be, should be, for-profit, non-profit.

non-profit won out, and i know that that was really important to you. why did you want ethereum to be a non-profit, and how did you come to that decision? vitalik: it was just very important to me. this is a technology that decentralized infrastructure that is meant to be not controlled or owned by anyone. and it is a platform for the world. and for that platform to be connected to a company that had a very small number of shareholders, i think, is something that could really centralize the ecosystem. and so, something that i thought was very unhealthy and wanted to really avoid. emily: now, nfts in particular have really helped bring new users into the crypto tent. we saw you at ashton kutcher and mila kunis' kitchen table. you also were not happy about kim kardashian getting involved. and i am curious, where do you draw the line when it comes to celebrity endorsements?

vitalik: the thing that i was unhappy with about kim kardashian was that she basically, like, shilled something, ethereum max. i would call it a borderline scam. it seems like this project that is basically just at best a pure money grab that is not really providing much value. emily: ethereum has had some growing pains. why do these problems exist? vitalik: this entire ecosystem has blown up and gotten big fairly quickly. ♪

emily: ethereum has had some growing pains, whether it is high transaction costs, traffic jams, front running. why do these problems exist? vitalik: this is the scalability problem. everyone has been talking about the scalability problem for at least five years now. and basically, it is like a simple supply and demand problem, right? like, if the number of people who want to send transactions

goes up, but the amount of space for transactions on the chain does not go up, then all these people who want to send these transactions are bidding against each other and only the ones that are willing to pay a really high amount can actually get in. the only way to solve this is to improve the technology to increase the number of transactions that the system can process. it is why we have been doing just all kinds of incremental improvements to the blockchain, clients, and the protocol and the code over the last five years. ethereum's scalability has increased by about a factor of five since the project started. and then there are some problems that are not like just scaling problems, per se, but they are still technology problems, right? like, there are problems that have to do with the fact that this entire ecosystem has blown up and gotten big fairly quickly. there are a lot of aspects of it where people are still trying to understand, like, what is the

correct way and what is the safest way to do these things. like, for example, the state of just security auditing for blockchain protocols, like, it has gotten much better since the dow hack back in 2016, right? but at the same time, challenges continue to exist. and that is normal in any space when you have, i guess, usage growing faster than the technology catches up. emily: can you contrast proof-of-stake with proof-of-work? why do you think that is so much better? vitalik: the reason why blockchains need to have proof of something is because these are decentralized systems. so, for example, in proof-of-work, the system actually measures how much computing power is being put into each block. and so, in order for an attacker to take over the network, they actually have to have more computing power than the rest of the network combined. right? like, so you can't just spin up a billion virtual machines on one computer. but the problem is that it

requires a huge number of computers to be constantly running 24/7. so, it works, but it is very expensive. proof-of-stake, it works differently, right? so, proof-of-stake works by instead using coins as an economic resource. so, if you have coins inside a system, then you sign messages with those coins, and for an attacker to take over, they have to basically have more coins than the rest of the network put together. so it does the same thing, but it avoids the need to have these computers running 24/7, and that is where the efficiency comes from. emily: you are planning major upgrades, meantime, and eth 2.0 is well underway. what will that accomplish? what problems will it solve? vitalik: so, i think what people call eth 2.0 has two big parts, right? one big part is the switch to proof-of-stake. so after a full transition to proof-of-stake, there will not be any more mining. ethereum's energy consumption will go down by a factor of more than 1000. so, it will go from being a big problem to basically not a

problem at all. and the chain will become more secure, it will become more efficient. so, after that, the next major milestone is what is called "the merge," which is when basically the proof-of-work chain just stops running, and all the applications on the proof-of-work chain get moved over to the proof-of-stake chain and continue running inside of the proof-of-stake chain from there. emily: now, while you are working on all of this, ethereum has developed an unseemly reputation as a fertile ground for scams. and i wonder how concerned you are about a crackdown like we saw with icos. what are the longer-term consequences? vitalik: there's definitely going to be crackdowns on things happening on blockchains, just like there is crackdowns on things happening on the internet. i do think that the state of the industry and the state of things

is improving. but if you just compare it to the way that the space was five or eight years ago, like 2014, remember, mt. gox just, like, collapsed and half a billion dollars disappeared. i think we still don't know where most of it is. things do continue to happen from time to time. but just, like, as a fraction of the scale of the space, i do think it keeps getting smaller and smaller. one big consequence, of course, is that mining is moving out of china, which, i mean, there is definitely a silver lining there in terms of decentralization. in that you don't have as much hash power located in one country anymore. but at the same time, you know, the mining farms there were real companies with real employees and real people. some degree of regulatory action is happening, but it is not looking like, you know, anything close to, you know, the level of, say, what people feared 10 years ago. emily: there's concerns about russia being behind a spate of cyberattacks, and cryptocurrency being used as a tool of extortion.

how do you think about the intersection of crypto and cyber warfare? vitalik: to me, i think that this is a temporary phase. like, i think what's happened is that just, like, even the internet as a whole grew a huge amount over the last 20 years, and for most of that 20 years, people just did not take security seriously. it is even the wrong thing to do to be doing to try to blame attackers. ultimately, the thing that is at fault is there are these excellent tools within cryptography or like within the technology behind cryptocurrency itself that allow you to be much more secure against these kinds of things. i mean, my personal hope is that people at least see the level of attacks that are happening now as a wake-up call, and so we get a massive effort to just improve the level of security across every industry and across the world, because if that does not

happen, right, like, then, you know, it is not even ransomware attackers that are going to be a problem. like, at some point, you know, whenever the first full-scale cyberwar happens, if people are not prepared, it is something that could end up, you know, being really bad for the world. emily: whether bitcoin, ethereum, or the blockchain really are changing the world seems to be an ongoing debate. is crypto the future, or is it a fad? vitalik: i think it is the future that contains fads. ♪

emily: right now, it is mostly finance apps that are built on ethereum, aside from nfts, and i am wondering, what is a killer app for ethereum that could lead to widespread adoption, much like email was for the internet? vitalik: i think there is a few candidates. so, de-fi is obviously one of them. i think, like, blockchain-based financial things have always been attractive because the traditional financial system just stuck more than traditional centralized tech, right? like, if i send an email to, you know, someone in guatemala, they are going to receive it in one second. with finance, you can not even say that. a lot of people and companies even today use cryptocurrency to send money internationally.

outside of finance, i think one interesting area where i think blockchains might go, if you notice that in order to access your assets in ethereum, you need to have an account. we are getting to the point where there is a lot of work that has been done on making these accounts very secure, and so, instead of just being accounts to hold money, like, these turn into fully-blown profiles, right? and once you have profiles, then you can start doing decentralized social media on top of that. the social and financial things that you can do with that, even working together, is something that i think could be really big. emily: now, whether bitcoin, ethereum, or the blockchain really are changing the world seems to be an ongoing debate. is crypto the future, or is it a fad? vitalik: i think it is the future that contains fads, much like the internet was the future and the internet contained fads. you know, there is definitely specific kinds of applications that do get overhyped from time to time, like icos back in 2017. and then, there are certain

kinds of de-fi right now. but at the same time, there are other de-fi projects that really are valuable. there is a combination of both, right? and figuring out which is which is something that is difficult to see ahead of time. and it is something we, you know, as an ecosystem are going to find out. emily: so, the crypto skeptics, many people that are admired in the financial world -- jamie dimon, warren buffett -- are they just wrong? vitalik: a lot of them have definitely been just wrong already, right? they expected, even back in 2013 to 2015, at least some of them, to see blockchains and cryptocurrencies fail and go to zero in price and not get any more interest completely. and even today, they have already been far more successful

than any of them expected. so, i can see how people in traditional finance, or at least some of them, can be inclined to kind of not see the value of blockchain-based finance immediately, but there are a lot of people even in traditional banks that see the value that blockchains provide and have been trying to come up with things and work with them. emily: one of them is jack dorsey. jack dorsey recently announced square is creating a new business focused on decentralized financial services, based on bitcoin, using bitcoin. what have you learned about jack dorsey's plan? does it seem like he's building something that sounds a lot like ethereum? vitalik: i am skeptical about these decentralized finance on top of bitcoin-type projects. so basically, because, like, the difference between bitcoin and ethereum, right, is that on ethereum, there is native functionality that allows you to essentially directly put either eth or ethereum-based assets

into these smart contracts, into these lockboxes where there is then, like, arbitrary conditions of any kind that can then govern how those assets get released. bitcoin does not have that functionality to the same extent. like, jack is basically going to have to essentially create his own system that enforces those rules, and then, on the bitcoin layer, the bitcoins will just have to be owned by probably a multi-sig wallet controlled by, like, either jack or just the participants in the system. it looks similar, but it will end up being something with a much weaker trust model. right? i really think that, like, this is the whole reason why ethereum started as an independent system in the first place, right? there are technical limits to your ability to kind of graft new functionality onto a system that's not powerful enough to support that new functionality. emily: facebook's mark zuckerberg is also making some big moves behind the metaverse. and, you know, what do you make of them wading into this decentralized world?

could they replicate some of the same problems that we see in facebook and twitter today? vitalik: i think mark is clearly trying to figure out what the next stage after the internet is and like actually get into it and create it, you know, before the rest of the world goes in some different direction and facebook is sort of left in the dust and becomes one of these previous generation, old-world companies. and so, we have seen facebook try to get into the crypto space with libra. so, and i think, in the end, libra did end up being possibly the wrong approach, because, like, the problem that someone like facebook has, right, is that a lot of people mistrust them.

and so, building their own platform, i know they tried really hard to create something that is a consortium with all these different industry participants, but even that was not enough, right? and there is just a huge amount of mistrust of them. but with the metaverse, i guess, the thing that happened during the pandemic is that we've basically very quickly switched from a world where the physical world was people's kind of primary center of experience, and that the internet was this new add-on to a world where the internet really is the center of people's experiences. and so, we basically are spending most of our time in a virtual world. and the question is just, like, what level of quality does that virtual world have? emily: so, ethereum in five years, in 10 years, where is it? vitalik: i mean, hopefully running the metaverse. but i guess we will see how it goes. emily: you have got a lot of people out there, a lot of

people who are trying to understand cryptocurrency, who are placing their bets. what is your prediction for bitcoin? does it replace the dollar? does it exist in 50 years? or is it something else? and then, similarly, what's your prediction for ethereum? because a lot of investors are choosing to hold both, or one, or the other. vitalik: i think replacing the dollar completely is unlikely, just because, like, there are things that the dollar provides, like price stability, for example, that bitcoin is not going to provide. like, i think even in a theoretical world where the u.s. dollar collapses, like even then, i think bitcoin is not going to be able to provide the level of stability that users and businesses expect to be able to set prices in. and in that kind of world, we would need something else. like, it could be decentralized stable coins, it could be something else, but we'll see. so, but at the same time, i think cryptocurrency can still have a very powerful and important role alongside existing currencies. emily: ethereum seems to have this reputation of being a community of creative engineering types who like

rainbows and cats and mythical creatures. i know you have some fun t-shirts yourself. is that a fair depiction of the community? vitalik: i mean, the community is a diverse place and, you know, it has many different kinds of people. you know, it definitely has its fair share of cat-people and dog-people and unicorn-people as well, and i think that's awesome. and i think it is really healthy to not take yourself too seriously. and that is definitely something that the ethereum community tries to do, you know, remember that the world is supposed to be a place to have fun, too. emily: all right, vitalik buterin, inventor of ethereum. thank you so much for joining us. ♪ every day in business brings something new.

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vonnie: it is 6:00 p.m. in new york. one company is said to raise millions of dollars in an ipo after pricing in hong kong dollars per share. the company says its retail offer is more than five times oversubscribed. they were forced to delay the listing after a blacklisting for alleged human rights abuses.