Cryptocurrency as Asymmetric Weapon

besides DC would like to thank all of our sponsors and a special thank you to all of our speakers volunteers and organizers for making 2018 a success cryptocurrency is an asymmetric weapon what the hell is this jackass up at the front of stage talking about anybody know what asymmetric means no I'm serious answer me Wow in terms of warfare try again smartass yes why you're right why okay let me ask you a question back in this in the Revolutionary War okay the American Revolutionary War we had an asymmetric war what happened was the British lined up in ranks because that's what civilized nations do right the Americans were behind trees going eddie --it watch right that's asymmetric

they're not you operating on the same principles does that make sense so the side operating on the principles of we're going to win and we don't care what it looks like they have the advantage don't they when you're going overhead well look they're operating under guerilla warfare the other word for asymmetric is pretty much guerrilla warfare right so that's what we're talking about so that's asymmetric warfare now or an asymmetric weapon in this case but cryptocurrency what's asymmetric about cryptocurrency you know what I'm jumping ahead let's start with the beginnings this is me I'm the CEO of Red Lion what does that mean I'm the chief operating officer of a small consulting company we do compliance we do advisory services we

actually have a subsidiary or a separate company that actually has a blockchain product coming out in the near future I will talk about that under NDA I graduated from Mach 37 I'm a member of several different organizations I run besides Delaware which is in two weeks hint-hint November 9th and 10th if you want to show up in Wilmington you can thank you janitor I sleep occasionally running multiple companies leaves very little time for what's known as these hobby things I do a lot of speaking okay all right so let's start with the basics can you hack as an economic weapon yes or no yes I mean I put it on screen man okay you can hack as an economic weapon

it's really that simple normally I shut everything down before I start speaking I didn't have time bear with me I can hack Sony and send the stock down 10% you can literally and by the way there's there's there's there's research to prove this you can use pump-and-dump tactics on stocks I can throw a lot of effort into social media and and medias a standard media publicist style stuff going this companies awesome this company is amazing this company is sexy the stock price goes up right all right I've bought it before all right or I haven't bought it before you can also do a dump and pump it's it's a bit weird but the point is is that at any point I

can rise the stock price by using my extreme Google foo which also means Google Adwords foo right and raise the price of the stock even just lightly I can also make it go down because I can release that dump of passwords and usernames and the breach that happened maybe two years ago who knows but all of a sudden there's a hundred thousand user accounts hey Mac you want to buy a user account right make sense to everybody I can lower the stock price it will I can raise the stock price it will can I manipulate that stock price doing that well that's kind of what I'm talking about right okay so that's stock that's like crypto what the hell's he talking

about well crypto currency is a hacking weapon all right how many crypto currencies tokens have been deemed scams let's let's do a show of hands how many people believe that out of the roughly thousand it's actually nine hundred and something tokenized crypto currencies that come out in the last couple of years more than fifty percent of them are scams raise your hands or not hold your hands up how many of them think 60% 70% 80% 81% yep 81% of the cryptocurrencies to come out in the last couple of years have been seen to be a scams pump and dumps also of course there's our favorite dark net markets that just suck up your Bitcoin and all your fun kryptos and go away all

that kind of stuff okay exit scams are how common or exit scams on in markets on the darknet like Universal they are literally sites on the darknet that our how to find dark net markets that say right at the top of them all markets are exit scams use them carefully but here's your list of markets okay so we now have crypto currencies as weapons we can manipulate stock prices we can manipulate crypto currencies what does he mean so back up what was the high of Bitcoin entire you know the entire history hi anybody know 19,000 something that's close enough we'll call it 19,000 what's the lowest it's been since it actually ramped up to there six there is mathematics that I

won't get into that says that everything from about eight up was manipulation 8,000 up was manipulation they raised over eleven thousand roughly dollars in value per Bitcoin on manipulation again we're talking pump and dump or in this case just pump and then they dumped it okay when they dump it it drops the value pretty significantly what do we see a ramp up mmm and then it came back up again a little bit right what's it now anybody sixth out 6500 okay 6500 to 9000 okay let me get a little economic here I'm sorry how many dollars sorry how many end is a dollar buy you yes hundred did you look up the price how did you know 100 it's what it's

always been how many dollars does a Canadian dollar get you what's that a Canadian dollar actually gets you about a well okay so I'm an American delegate to about a buck 25 in Canadian the Canadian delegate to about 75 cents okay that's because that's what it's always been there are resting points for currencies are they logical no god no they're not logical it's just what we expect them to be so we make them that way with our collective will after all fiat money is nothing but the collective will and goodwill of the American and various foreign government peoples right okay so now we're talking about the fact that we can actually understand the resting points of various

currencies now you've seen the news story Bitcoin will be a hundred thousand dollars wrong why because if it was going to be it would never have dropped at eighteen it would have kept going it would still be on the rise the resting point of Bitcoin is going to be somewhere around seven to seventy five hundred my prediction call it what you will please feel free to say you know you're an idiot it doesn't matter to me my wife says it all the time I'm kidding she never says that in front of me so so in all seriousness that's what I believe some people think we'll be 8000 still I call it you know right around the same

place do you know what I mean so we've got resting points for currency regular currency fiat currency and cryptocurrency we can manipulate them we can manipulate stock prices can I use all these different manipulations to perform economic weaponry economic warfare the answer is yes now has it been done I have not done this research honestly because I'm a little scared of what I'll find if I can manipulate a cryptocurrency to go up in price and thereby make enough money that I can then buy some stock okay and then I don't care about the cryptocurrency anymore do I but cryptocurrency is so volatile how fast could I make that money a lot faster than if I invest in

18t right so if I can do oh this is the short version okay we might be really fast on this talk sorry if I can use cryptocurrency to build myself a nest egg if you will all right then I can use that nest egg to buy stock I can manipulate the cryptocurrency to build my nest egg I then dump it by my stock nest egg I manipulate it I drop it and to further accentuate the drop as I sell I release breach data how hard is that to do let's be honest how hard is it to find breach data about a company pick a company I don't really care is it hard if you guys

honestly went looking could you pick a company almost at random out of the fortune 5,000 and find breach data about it from the last five years pretty damn close you might want to be a little more specific not just try this at random but you get the idea right if I can find breach yet about a company I don't care if it's a year old I don't care if it's two years old I really don't it's public perception okay let me give you an example we have the TSA who here likes the TSA yeah I didn't expect many how many think the TSA do a good job you are not patriotic you horrible horrible people so how many people think you

could do more damage on Black Friday then the TSA could ever ameliorate or remediate do you know Black Friday is do you realize that if you shut down shopping on Black Friday with some threats and a couple of quickies you'll do more damage than TSA has ever ever ever averted I mean I think it's six percent of GDP are of the entire country for the entire year happens on Black Friday I could be wrong it's single digits but it's single digits of the entire country's economy if I can shut down Black Friday well hell I can do a lot of damage can't I like I said I'm supposed to turn everything off when they tell you you're speaker three

minutes ahead of time it's kind of awkward so the point is that's again asymmetric warfare if I can make some phone calls and cause more damage than the TSA has ever fixed or averted that's asymmetric warfare cryptocurrency can be used for asymmetric warfare but because I can pump it dump it pump a stock sell a stock increase the dump with a breach and walk away with millions of dollars now if any of you are aspiring blackcats come up here I'll get you arrested it's not a problem please don't utilize this technology and I've deliberately left out enough details that it's not easy to do honestly you're smart enough you can figure it out in I'm guessing 15 minutes

okay most of the 15 minutes will be involved with navigating them on the incredible arcane stock market regulations but honestly it's not a big deal so let's talk about this this I said is the short version of the talk I really didn't intend for it to be given for an hour but what I want to do is ask you something now that you understand what asymmetric warfare is how many of you show of hands think that you could potentially figure out give it a year in a year could figure out how to do this how many of you go wow that's interesting I never thought about it that way how many of you're wondering why I'm not

talking about hacking etherium DAPs I'm not that speaker I'm a replacement speaker but you see a lot of times what I do is I don't think about the technology of a system I think about the business logic of a system every system you build everything you build is based on the business if it's not you're not increasing value and remember what's one of the big tenets of cryptocurrency we may not increase Fiat but we increase value right does anybody know what I'm talking about Wow okay when you buy Bitcoin at a thousand bucks and it goes to two thousand you have you increased your u.s. dollars in your pocket no it's not in your pocket it's

potential but you've increased the value in the world it's like when somebody slashes the market cap of a company by half they've reduced the value in the world in this case we're increasing the value so as bitcoiners or etherium or dogecoin or altcoin or dark coin or light point or okay maybe not Manero no I'm just kidding we increase the value of our environment we increase the value of the world and believe it or not but effectively this is all about perception we perceive that we've increased value we believe we've done good even though we've burned more energy than Ireland okay if you perceive that something is breached if you perceive that something is wrong you

have a problem and you can actually lose your job as a security person even if a breach never actually happened there have been times okay I got to tell you a funny story there have been times mmm that a breach didn't happen and dummy data was released deliberately to see who would try to use it and people have been fired because people thought that it was an actual breach honeypot type stuff the honeypot gets seized the data is like well who we sell we stole data from company X they sell the data the data gets out in the in the wild the data gets back and somebody gets fired because we lost data we were breached no

that's our data you're calling me a dummy no that's fake data no it's not it's real data it's happened it's horrifying it's annoying but it happens perception Trump's reality in this case we're talking about the ability of cryptocurrency to trump the perception of a normally logical group of people and actually cause economic harm if I slash the market cap of a company because I send out breach data at the same time that I'm dumping stocking it could you cause a run on the stock yes if I can cause a run on a stock and I close the company down oh cool who here hates their company is it a public company okay again this is a short talk

let me ask you a question what questions do you have about this did I seriously confuse you did it make sense what I said talk to me sorry shortest comment ever okay TL DR makes sense good what's that okay so this is the cool part who knows who the biggest Bitcoin mining farms are where they are for example anybody China why China energy is cheap near the hydroelectric dams right and they've got these weird taxes about energy so it actually reduces the taxes if you concentrate the use of energy I don't know why but okay whatever now they've been outlawing I think I have it on here China author authorities have banned token sales local exchanges are closing

down this is a regulation of cryptocurrency why because they're scared part of it is because they're scared they're losing out on taxes let's be honest taxation is theft but a part of it is because they're scared of how these things can work against them now China is actually closing down Bitcoin mining I'm not sure if they fully outlawed it but I mean can you imagine China going you know what let's not outlaw it but now we own all of it what if China actually said you know what let's drop like you know a few billion yen into more Bitcoin mining does anybody know what the 51% problem is and it seriously does anybody know where it is

okay PW what's the 51% problem rewrite I can unwind and rewind the blockchain because I have the majority of the voters that verify the blockchain that make sense to everybody so they actually happened I think it was Giga hash I don't remember that actually figured out oh my god they were a pooling companies everybody bought into their pool type of thing I have this capacity I'm gonna buy into the pool and then I get a percentage of the any wins they realized they had all worth more than 51% and they voluntarily shed some of their capacity well that was a while ago when everybody was all like you know oh you know singing Kumbaya on crap okay

now China's like um we own 40 I think it's 47% it really isn't hard for them to get to 51 if they wanted to if they could do that and start double spending and reduce all of the trust in Bitcoin would that be a problem only if you own lots of Bitcoin and some people do they might get upset or they might just lose all their money to China what does that mean that

the future of right but do you think China can't let this is a good question good sure so the idea is why is it 51% problem a problem so a 51% the 51% problem is defined as if one entity whether it's a nation-state a person a company or whatever has more than 51% of the mining capacity of the entire Bitcoin mining pool they can effectively rewrite the blockchain so far so good okay at that point whoever owns 51% of the capacity 51 or more percent actually 50.1 but everybody just abbreviate satisfy 1% anything more than half its controlling interest okay make sense to everybody anybody who has controlling interest in the Bitcoin mining pool as PW says they

should have an interest in it which means they shouldn't screw with it because it screws up their investments but in reality it not only can screw up their investments but it can also increase their investments because they can rewrite transactions they get to rewrite history as it happens to be favorable to them oh we don't like that that transaction happened it never happened make sense to everybody now there are things that you cannot undo for example my three and a half month year old back there I can't undo her know what I want to okay oh wow I think this is our first time being mentioned in the talk don't worry they'll be more honey

yes actually she does and I don't control it it's been set up along with the other novelty accounts for me Oh baby Quadling baby Quadling Quadling hat Quadling voice they're all novelty accounts I don't control i interacts with its weirdly enough but anyway so with these kinds of problems oh dear God with these kinds of problems you have an issue with the trust placed into blockchain if you have an issue with the trust placed into blockchain you can't use it again asymmetric warfare I may have to spend money to do that but for China how much money do they actually have to spend I mean let's be honest it's pennies to them and they get to

control hundreds of billions of dollars worth of US Dollars or their equivalent without firing a shot without losing a single life that's another method of asymmetric economic warfare don't you think pretty cool stuff are there other ways well let's talk about the original topic you were here to talk about what if I can find a flaw and etherium smart contracts if I can find a flaw on smart contracts can I make off with millions tens of millions of dollars and force a theorem to do a hard fork oh wait that happened okay who here owns aetherium classic it's classic right I'm not hallucinating am i correct it's aetherium classic and what's the new one just playing the theory I'm right okay

who here owns any aetherium classic is anybody on regular atheria two people and you all hear or talk on smart contracts you might want to get some gas people good pun huh all right there are a lot of ways that you can utilize cryptocurrency in an economic warfare fashion there are a lot of ways that you can utilize cryptocurrency in economics there are a lot of ways that cryptocurrency is upsetting the applecart if you will of economics badly if you understand what those are you can use them and manipulate them there's a gentleman here who has the title self given of information arbitrage or what it means is he takes information cheap that he buys in cheaply

sells dearly sells expensively he's exploiting the arbitrage or the difference in price of information cryptocurrency has a very unique system right now in that there's an arbitrage in value people that don't understand this will pay a lot of money for it people that understand these things might not pay as much you can buy from one solve the other vice versa it's an interesting place in history we lie in right now smart contracts just because I want to give you some value for what you expected to get our way that we can use that value by utilizing machine not machine learning anybody that says that gets immediately dunked and everybody says eh I I'm just gonna defenestrate

but we get to utilize machine rules and machine logic okay to actually manipulate and regulate behavior and activities that's what smart contracts are right okay i know'd apps are not just smart contracts but I love smart contracts I think they're fun and they're interesting and they're exciting think of them as a programming language they are written in a programming language but think of them as a programming language do you know the programming language they are it's called business logic understand what you are writing not in terms of code but in terms of logic let me give you an example every time that I've ever written out a comp plan for a group of salespeople I've written it out to say I

want you to sell these things not these things okay because I want to get rid of these things right I'm gonna put sales on them discounts on them whatever right I want you to sell the hell out of these things they go well I make more Commission on these every time we've spent three months writing a sales comp plan compensation plan for salespeople takes them 15 minutes they can figure how to sell more of these and leave me with these in the warehouse high and dry people do what you pay them to if you pay them to break your smart contract guess what they're gonna do okay don't forget that you want to find flaws

in it yeah do some code review look at your code you really want to find where people are gonna screw with you look at your business logic that makes sense to everybody okay and realistically in a sort of way that actually relates we're talking about business and money and economics here we're not talking about programming we're not talking about mining we're not talking about consensus algorithms we're talking about where do people make a dime where do they make a dollar where do they make $6,000 $18,000 where can they buy things that you cannot trace I don't know how about the dark web how about using the scary cryptocurrency stuff okay so it's awkward what time did I start 2:30

roughly okay I'll go for another minute it's awkward in the law enforcement world by the way I spent I don't know four weeks ago I spent three hours explaining how to trace a single Bitcoin through a transaction note to the highest anti-money laundering society in the country they had no idea they were like how do we check if people are using the stuff to launder money like oh why don't you just trace the transactions I mean at least you can see what they're doing with it right they're like you can do tact well that's the point of course you can do that they had no idea none who here understands about Merkle trees and hashing and things like that anybody

you want to do daps and you don't know what Merkle trees are I got another talk I can give you so let me ask you a question why are you guys here if you're here to talk about smart contracts you here to learn how to program them I'm serious answer me somebody yes it was what was the talk supposed to be oh I'm gonna defenestrate you it was actually an AI talk awesome I'm so glad they left and it no I'm not a I is amazing stuff but it is not the stuff of magic or science fiction machine learning is a much more apt name anyway so they told me was a smart contracts talk

that's hilarious okay anyway so we've gone over business logic as it relates to cryptocurrency we've gone over business logic as it relates to economics we've gone over business logic as it relates to activism and stock prices crypto currency prices fiat prices and we've gone over regulation and how country and nation states can be part of your threat model that's terrifying they literally have a threat model where a nation-state can be part of it and they don't have to lift a finger except make a few suggestions to the people under their rule so that's bad does that worry anybody you're like well what does it matter to me well who here has a 401k or a retirement account

that 401k is invested in what stocks and bonds if those stocks and bonds go does it hurt do you want that to happen amazing does it matter to you now yeah because you'll have all the money to know you won't in all seriousness I mean I'm making a joke out of it but it's not a joke the the volatility of the cryptocurrencies and the subsequent volatility of the stocks to hacktivism is actually worrisome for those of us who and I don't mean to sound this way but for those of us who look at things in a slightly larger scope it actually is incredibly worrisome in that there are single individuals groups of individuals and crews of individuals who

can manipulate our entire world and our net worth that's why so and so that's what this is about any questions yes very cool great question so if I take a small company like tenable just IP owed if I Turk take tenable and turn them into the toilet I'm not picking untenable it's just the first thing I can think of recent IPOs okay is anybody's 401k going to be trashed the people a tenable yes but not very many others do you know I'm saying but if I can take a few companies on the S&P 500 or in the Dow which is a watched by many many more people does that make sense then can I and sorry the question was

what does it matter if a few companies get their stocks trashed how does that translate into an economic recession and the answer is if you pick the right companies and you have the right data which you can find over years and years and years and you can destroy a company on the sp500 yes you can do some nasty things to an entire countries the Dow Jones index if it starts going down even if the markets having a good day or let's say the markets being neutral that day and I can trash one of the big foundational companies of the the sp500 let's say is that gonna bring the sp500 down yes is it enough to really matter

maybe maybe not it depends on how big a component of the S&P 500 that one company was right but what if I do it to five companies or 10 companies okay but that's a lot of planning yeah we're talking about a concerted effort by a group of individuals how many of you think that with the methodology that I've laid out as skeletal as it is my skeletonized it pretty harshly that you could figure this out if I gave you a year fed you clothed you took care of your needs for a year you could end all you did was study how to do this and get the data and build to do this you could

do this after a year or two anybody who thinks they could do it 1 2 3 4 5 maybe let's say 10 I can do it to 10 companies next year investment of about a million dollars I'll probably make about a hundred million on the on the pump part of that you know I'm saying or I could just short it and go on margin right and if I go on margin it costs exactly what does margin cost these days there's a cost for a margin call and I forget how much it is but it's a percentage right so let's say I've got a few hundred thousand dollars in into that and a million dollars to

pay all you guys for the year so you can study to do that to find the breeches to get all the data right that stuff so with a with an investment of a million and a half I can cause and make myself a hundred million dollars and cause about a half a billion dollars in damage that might not be a recession but let's say it happens that week and then three weeks later and then two weeks later and then one week later ten companies at a time ten companies nine companies twelve companies fifteen companies so you get the idea that's going to hurt a country pretty harshly won't it

that is a great question won't people realize yes I won't people are sorry I love this one won't people realize that you know every week I see companies getting short sold and like you know dope there's a pattern there right won't they realize this pattern and track it back to me and find me and so high frequency trading means that I all I got to do is build a high frequency trading bot which by the way there's publicly open source code for this stuff and I don't sell the stock in blocks of fifteen thousand and fifty thousand a hundred thousand shares i buy and sell it in blocks of three five nine one sixteen and a half whatever doesn't

matter do you get the idea that makes sense do you know what high frequency trading is high frequency trading is the idea that we used to do stock with people I would buy 500 shares I would sell 10,000 shares we don't do that anymore most of the time there are still pits what they call pits where they actually do it buy and sell the shares those are mostly futures pits now really most stock is sold by bots and stock is sold an iShare at a time 20 shares at a time 50 shares at a time a hundred is actually a big transaction right now but you do it every three tenths of a second every 14 seconds you

do it in relation the quants the mathematicians have these algorithms and they buy and sell in incredibly fast movements of stock in response to incredibly minut adjustments of stock prices well I can react or I can act and try to force stock price down and high-frequency trading as a matter of fact they run naked high-frequency traders run without fire walls without antivirus without any security whatsoever why because it takes time I know one high-frequency trading company they actually sued their switch vendor because the switches they sold them were for this is not a joke for nano seconds slower than they were promised and that cost them a million dollars a minute now do you understand what I'm saying I

can do this in such tiny increments it's so fast nobody L know what's actually happening I did it in big blocks when I talked about it 10 companies 12 companies one I do 100 companies but in tiny little blocks for the next three months and just dropping breaches one company at a time three companies at time whatever they might see a pattern there but I can put the breaches in so many different places all over the world who's gonna see a pattern it just looks like the I mean come on how many breaches have happened in the past year anybody five or hundreds hundreds you think an extra hundred breaches is gonna get noticed they happen to all be S&P 500 oops that

make sense to everybody am i scaring you a little bit a my terrifying your wallet it's a bit out ray it's a bit out there but it is real any more questions yes it's not that I can figure out no stabilized okay so so the question was other mitigation strategies that I thought of and the answer is I can't think of any because this is a very flexible strategy right we've talked about three or four different varieties of it already somebody said margin sells to sell short you're absolutely right that's a that's a that's a variety of it I can't think of a way to fix that then it was well can't we just say that if you buy a lot

of cryptocurrency and it goes haywire we're just gonna stop it sale or tie it to the dollar like tether I think it is or pacer you said and very and will stabilize it out of the roughly thousand it's like nine hundred and something but we'll call it a thousand crypto currencies that have been put out in the past couple years how many of them are dead coins anybody okay let's start with 100 who thinks 100 or dead coins

820 roughly over 80% of the cryptocurrencies have been put out there are dead actually cool note does anybody know that some of them are alive again does anybody know why nobody knows who's moving these things somebody who sweeps in buys up a crap-ton of this specific dead coin and it starts moving a bit from wallet - wallet does anybody know why no well sort of markers markers what do I mean markers so if I'm laundering money I need to remember that I owe you a million dollars real money you laundered a hundred million I give you what's that a percentage 1% I need to remember that I owe you a million so I issue you a dead coin one dead coin of

this particular variety is a million dollars that's pretty cool money launderers this is my suspicion don't quote me on this are using them as markers for the money they owe people is that sexy or what it's really funny okay sorry just fun fact okay any other questions I realize it's not what you're expecting and I apologize I hope it was interesting and you learned something did anybody learn anything oh thank god okay good thank you very much yes you have a question

Wow is it a good investment to invest in cryptocurrency did I hear you correctly was that is that the right okay so the answer is yes absolutely it's a fantastic investment to invest in cryptocurrency if you're a sophisticated investor with enough money to actually make the market move where you want it to oops I think I screwed that up it's okay we're done but if you're not a sophisticated investor with enough money to make it move to where you want it to it's a horrible idea why because frankly mining is not worth it anymore as far as I can tell two weeks ago the last I looked mining wasn't worth it the I think monaro is worth it to mine a

little bit but it's so expensive and pain in the butt to start up it's not even funny you got an outlay about three to six thousand dollars to do a tiny little mining rig and unless you're getting free if you have a solar plant dude go to town - to buy crypto with fiat with regular US dollars it's volatile if you want to buy some go ahead look think of it as gambling do you go to Vegas and put your mortgage money on the line well some people yes most people go this is money I can afford to lose the free drinks make up for the money I'm good right it's play money if you want to put play money on

the line go ahead there's nothing wrong with that it's kind of interesting and you get to learn go put play money online and put it in with a smart contract go put play money on the line and put it in with a with a machine intelligence and artificial intelligence algorithm to work the markets for you yeah see how far you get with that but if it's more than play money I really don't recommend it yes keep going yeah another question

Segan please I'm sorry of course that's why I said play money if you use your play money to learn something whether it's the probabilities of dice and baccarat whether it's the the ability of a dealer to deal seconds in blackjack and that's fun whether it's how to count cards or whether it's how to learn whether it's how to work cryptocurrency that's a worthwhile exercise and play money if you use play money for anything else to actually invest I mean if you're gonna actually invest great if you're gonna invest in crypto to learn play money is great if you expect to take play money of which we define as I don't care about it money and put it in there expecting to be a

billionaire you really need a time machine to go back to 2010 first okay buy Bitcoin at a quarter each because I wish I'd done it I've got friends that I used to work with they're now billionaires sorry I didn't do it sorry honey but I didn't and right now there are billionaires by the way who were multi billionaires at 16 and 18 thousand who are now only billionaires now my heart bleeds for them of course but I think they'll survive again Andrew Carnegie got a stock tip from his shoeshine boy and immediately sold out of the market that was a week before Black Friday that's a hint any other questions yes [Music]

I mean it's diminished so the by the way I love that I've got to point out the fact that my three and a half month old has amazing lungs just like her dad I'm very proud bye honey so what's that I'm repeating the question so the question was it sounds like this cryptocurrency stuff sounds like zero days what do you mean well as soon as I use a zero day it's now revealed the day of a zero day is the most powerful day you have it right but once you use it who people are gonna start working on patching people gonna start working on building you know hardened systems damn it every day diminishes the power of that zero day

right unless your MSO eight oh six seven because I still find those damn things but you're right to a certain extent the problem is the stock market I can use a zero day on a company and if I use a zero day on a company do you think they release all of those IOC s to everybody else I mean don't every doesn't every company share all their information to every other company right Yeah right okay if I use a zero day in ten different companies on the same day all right I get all 10 companies don't I probably maybe nine maybe ten whatever but I get a majority of them and then I can use

that information two months later three months later four months later five months later six months later ten months later twelve months later or whatever to destroy them in the stock market the information is a time bomb they might not even know they were hacked if I'm careful because I don't use it I don't put it out there in the wild so this strategy is well known I mean like we're talking about okay everybody knows that Sonia got hacked right everybody knows it I mean does does anybody hear surprised that something got hacked a while back okay how come your companies aren't proof against that hack are they is everybody's company here proof against the hacks that they used against Sony

put your hand up if you think you are even if you think you are put your hand up good why because maybe you don't know what hacks were used does it it does anybody know what hacks were used against Sony oh you mean our information-sharing socks

right except that I can have 3,000 wallets with a single Bitcoin in each and all you know is that there's 3,000 wallets with a single Bitcoin in them but I have the power of 3,000 Bitcoin you just don't know that all those wallets are mine with their anonymous by just by default by design unless I interact with other wallets that are identified in which case then you can individually me potentially based on the interaction so sorry I have a talk on that too so my plan that was anti-money laundering talk by the way so the point is is that yes you're right Bitcoin can be tracked and traced and you can watch the transactions but you might not be

able to tell who's doing what or what they're doing because of the anonymous nature of it [Music]

so how long ago was Bitcoin at nineteen thousand or whatever was at the top a year ago it took him a year and by the way it's not well-known to me took them over a year and it's not well-known that Bitcoin was manipulated to that height did anybody here know that before I told you a few of you the rest of you went but Bitcoin was at nineteen thousand yes because people made it to be nineteen thousand you didn't even know and I don't mean any offense I'm not trying to be rude here most the people here didn't know but if you didn't know how can you be expected to protect or see that pattern

I apologize what I'm saying is the basically that we're all overwhelmed with information and finding those patterns as anomalies well there's a lot of systems out there that claim to find every anomaly in a system yeah there's a lot of anomalies out there and some of them aren't related only to technical problems some of them are back to that business logic I need to open the financial papers to see those anomalies not the code tabs and yet does that make sense good question a really good question the answer is it's possible they'd require somebody who's dedicated and believes as a problem and then they go find it they find those patterns they find those anomalies they find those

weirdnesses and sometimes we just don't even realize it until way too late and when we don't share information because we don't it really makes it difficult make sense okay any other yeah

right so target 1 the most famous breaches right what happened to their stock anybody but the minute it happened their stock dropped I think five points or something like that it dropped some right okay and then everybody went oh yeah yeah that was like last week it's cool I'm gonna go use my red card again okay and the stock went back up so yeah you're right and ever since then but every time you get called excuse me sir your card was compromised we're gonna be sending you a new card please don't worry everything's fine none of your data was released and you'll never have a problem with it but we're gonna put you on credit monitoring for a year

because we're not sure every time you get one of those calls you go oh my god and if you own stock in that company might mean to sell it okay if you read about it in the Wall Street Journal what's the thing nobody wants to be read about in the Wall Street Journal you never want to see your name in the Wall Street Journal unless they're interviewing you for a good thing and how rare it it's much more common to be in there for a bad thing right I mean talk to pwh guy so the Jaden part fear is immediate fear is scary you get scared then logic kicks its head back in and you go oh yeah it's not a

big deal it happens all the time what's the big deal all right that's cool but the fear there's the immediate of holy crap I got fact then there's the my data might be compromised then there's the I own stock in that company and they got breached oh my god I should sell it right in a broker bomb of a sell sell sell sell sell in 2008 when the financial crisis hit this country if you held your stocks if you held your money where it was you're okay now how many people didn't most of them they sold and sold they bought high and sold low although wise known as the other way around the wrong way around makes sense

to everybody does that answer your question people get scared it's immediate

these days okay so to be honest the new cycle is getting jaded with breeches but remember breeches are a great great way to do filler content if there's no active shooter let's throw a breech in there sorry I'm not fond of news organizations okay I mean I love them to a certain extent sometimes they do do great work weirdly enough by the way do you know the Christian Science Monitor they are a great news group they have a passcode I think it's called they have a fantastic technology section has nothing to do with religion at all they are a fantastic hard news news group weirdest thing ever love okay anybody else questions comments why scratch the jokes

yes in the back

oh my god so the question was what is my opinion or do I have an opinion forgive me on whether the what will happen if the SEC is the Securities and Exchange Commission regulate Bitcoin the securitization of Bitcoin backed IPOs as well as IC OS which is initial coin offerings I have an opinion most of it is is a profane but I will offer what I can the security is using Bitcoin to back securities is really a sexy idea for idiots while it will in the future use ok I'm sorry back up a step there's cryptocurrency and there's the technology that cryptocurrencies based on this anybody know what's called blockchain ok blockchain is cool now

blockchain is not the only immutable database out there but it is a very good example of a very good immutable database I like blockchain I'm building a company based on blockchain it's cool sexy neat stuff crypto currency it's interesting it has its sexiness monaro has some great privacy initiatives I think they've got some brilliant mathematicians working on Manero ok really I do and it's really cool to see what they're doing to make privacy interesting and useful I love that but cryptocurrency as an investment vehicle is terrifying because of the volatility and because while we rely on the dollar to always be worth roughly a hundred yen or roughly 1.3 Canadian dollars or you get the idea we have not

seen the resting point of cryptocurrency so we see this here's the dollar against the like the N okay here's crypto currency against the dollar you get the idea everybody so when you securitize something in cryptocurrency you have the opportunity to make a billion dollars or lose everything you own your choice now as for the regulation holy God so this slide shows you that these guys these are everywhere that regulation is starting to happen the regulation is happening coinbase is a money services bureau it's a regulated entity okay and that's why it takes you 12 days to get a damn account with coinbase and kyc AML such a pain in the butt but you know what they have these things

called protections for the consumers it's amazing okay that's why exit scams in the dark web are so easy because there's no protection have a nice day so what I think about regulation I think it's gonna cause a lot of bureaucracy I think it's gonna cause a lot of problems a lot of headaches I think it's gonna make a lot of people think that they're crunchy shiny granola things are just not cool anymore and I think it's gonna protect a lot of people who are not sophisticated investors so overall I think it's a good idea how many people would have their money in the bank if it didn't have FDIC insurance well okay you've thought about it most

of you haven't thanks to you or solid if they go to business they each of you a check okay so ladies and gentlemen last call one two three real quick

what would techniques would be used to manipulate the price cryptocurrencies simple buying and selling it's a pump and dump scam watch boiler room it's an old movie but it's great and look up some of the pump and dump scams on Google honestly it's exactly the same okay ladies and gentlemen thank you very much my name is Josh Marquette hit me up on Twitter or email emails better I don't really use Twitter anymore thank you very much have a nice day