July 23, 2026 • 40 mins
Is Bitcoin dangerous to America? To find the answer, we’ll talk to experts in the crypto arena, and tell the story about the lengths to which the U.S. government has gone to halt the growth of Bitcoin.
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Speaker 1 (00:03):
This is red Pilled America. Bitcoin has been one of
the most fascinating and controversial developments in the history of
monetary technology. When Red Pilled America did our first deep
dive into bitcoin called Crypto in July twenty nineteen, each
bitcoin hovered around nine thousand dollars. When we did our
second deep dive called Crypto Revisited in January twenty twenty three,
(00:24):
it was at about sixteen thousand dollars. Today, as I
record this, it's hovering at almost sixty five thousand dollars
per coin, in almost seven times increase in seven years.
That seems impressive until you realize that over the past
seven months, the value of a bitcoin has been cut
by almost half its all time high of one hundred
and twenty six thousand dollars. Next week, on July twenty ninth,
(00:46):
the FED Chairman is expected to provide big news that
will impact the economy, Wall Street and bitcoin. So to
provide a refresher over the next week, we'll be republishing
both our deep dives on Crypto. Where is Crypto Going?
After listening to these six episodes, tell us what you
think and don't forget to become a Backstage subscriber, where
you get add free access to our entire back catalog
(01:08):
of episodes. Just go to Redpilled America dot com and
click join in the top of the menu. Now on
with the show. If you haven't heard about bitcoin by now,
you must be living under a rock.
Speaker 2 (01:23):
Bitcoin.
Speaker 3 (01:24):
Bitcoin.
Speaker 4 (01:24):
That was the moment that I wanted to use bitcoin.
Speaker 5 (01:27):
I personally I own bitcoin in my hedge fond.
Speaker 6 (01:29):
Do you think this is a currency, a currency that's
really going to work eventually? Well?
Speaker 1 (01:33):
I think it is what this internet. Cash has become
all the buzz, But recently the hype has taken a
different turn. Many powerful people seem to fear digital currencies.
Speaker 6 (01:44):
Hey, look for colleagues to join with me and introducing
a bill to outlaw cryptocurrency.
Speaker 1 (01:50):
With all of these economists, bankers and politicians raising a
red flag about the emergence of digital cash, it got
us to thinking, is bitcoin dangerous to America?
Speaker 7 (02:03):
I'm Patrick CARELCI and I'm Adriana Cortez.
Speaker 1 (02:06):
And this is Red Pilled America, a storytelling show.
Speaker 7 (02:11):
This is not another talk show covering the day's news.
We are all about telling stories.
Speaker 1 (02:16):
Stories Hollywood doesn't want you to hear stories.
Speaker 7 (02:19):
The media marks stories about everyday Americans of the globalist ignore.
Speaker 1 (02:25):
You could think of red Pilled America as audio documentaries,
and we promise only one thing, the truth. Welcome to
red Pilled America. Is Bitcoin dangerous to America. The topic
(02:50):
has been popping up more and more on our screens,
but the speculation was sent into overdrive after President Trump
condemned bitcoin and other new digital currencies.
Speaker 8 (02:59):
A crypto is being talked about. The President actually weighed
in and tweeted about cryptocurrencies last night. He wrote in
part this, I'm not a fan of bitcoin and other cryptocurrencies,
which are not money and whose value is highly volatile
based on thin air. He writes, unregulated crypto assets can
facilitate unlawful behavior, including drug trade and other illegal activity
rights the present.
Speaker 1 (03:20):
To get to the bottom of bitcoin, we'll first look
into the origin of this tech phenomenon. We'll talk to
a few experts on its emergence and impact on America,
and we'll hear a story about the lengths to which
the United States government has gone to halt its growth.
But I want to warn you here before we get started.
At first glance, the topic of bitcoin seems complicated, It
(03:42):
has its own language and challenges the way we think
of money. That said, if you stay with us, you'll
know more about bitcoin than most And today that's vital
because some say the disruptive technology driving this new phenomenon
could even be bigger than the Internet. Understanding bitcoin has
now become mandatory.
Speaker 9 (04:12):
A lot of people say that in bitcoin or internet
terms with it in like the nineteen eighties.
Speaker 10 (04:16):
What would happen, for example, if golf nations, rather than
trading oil and dollars, moved to bitcoin. That would I think,
destroy America as a global empire.
Speaker 3 (04:27):
You know, governments are worried. However, I don't know that
anybody can prevent it.
Speaker 6 (04:31):
They need an escapegoat, and Roster's their scapegoat. And I
think I personally think it was because of the bitcoin.
Speaker 1 (04:38):
Everyone is talking about bitcoin, but what is it? Simply put,
it's a new currency system. When we think of money,
our minds typically conjure up images of greenbacks, US dollars,
that physical paper money we sometimes carry in our wallets.
Speaker 7 (04:54):
Bitcoin is also considered money, but it's a brand new
form of currency that only comes in electronic form. There
is no physical coin or bit bill. This kind of
digital money is called cryptocurrency.
Speaker 3 (05:11):
Yeah.
Speaker 9 (05:12):
I think the simplest way to think about Bitcoin and
other cryptocurrencies, all of which do stem from Bitcoin originally,
is best thought of as Internet cash.
Speaker 7 (05:23):
That's Billy Bambra, a freelance journalist. It's been covering cryptocurrencies
since twenty twelve.
Speaker 9 (05:29):
Just like you have cash that you use in a store,
Bitcoin or other forms of cryptocurrencies are or could be
considered cash that you use on the Internet. So it's
digital cash. It doesn't fit quite into the same definitions
of a traditional currency. It doesn't fit quite the definitions
of a traditional commodity like gold. It's somewhere in between.
(05:50):
The exact use case has not quite been pinned down yet.
Because it is something entirely new.
Speaker 7 (05:56):
Internet cash is a brand new, disruptive development in currency.
The history of money helps illustrate this fact.
Speaker 1 (06:08):
Before we had currency, people had to rely on the
barter system, or you would trade something of value that
you possessed for something of value that someone else possessed.
For example, your stockpile of furs were a form of
currency to purchase, say a bale of wheat that you needed.
But often there was a problem what you had of
value wasn't always what someone else wanted in a barter deal.
(06:30):
Person A may have had a bale of wheat that
you wanted, but they didn't need furs, so the trade
wouldn't happen. You'd have to find out what person A wanted.
Let's say they needed wood. Then you'd have to find
person B that had wood and trade your furs with
that person, assuming they wanted furs. Then you could take
your newly acquired wood and go back to person A
(06:51):
and trade your wood for their wheat, that is, assuming
they still had the wheat. As you can see, bartering
was a bit complicated, and as societies grew it became
even more difficult. Need for currency arose in order to
facilitate trading.
Speaker 7 (07:09):
Throughout history, people have used all kinds of physical currency.
Speaker 2 (07:14):
There's hardly anything that hasn't been used for money.
Speaker 7 (07:17):
That's the latent. Famed economist Milton Friedman.
Speaker 2 (07:20):
Rock salt in Ethiopia, brass rings in West Africa, cowrie
shells in Uganda, crocodile money in Malaysia. I'm sir, it
isn't it. Even a toy cannon. Anything can be used
as money.
Speaker 7 (07:33):
Most pre industrial Revolution, cultures decided on some form of
currency to facilitate trade.
Speaker 11 (07:39):
Look, the most important thing with a currency, for example,
the Indian shell wapam, which would basically beats, is that
it be limited in supply.
Speaker 3 (07:48):
What limited the supply of shell wapam was. It was
difficult to make.
Speaker 7 (07:52):
That's economist Peter Maurice, Professor emeritus at the University of
Maryland Robert H. Smith's School of Business.
Speaker 11 (07:59):
Anybody could make it in the Indian community. However, it
took a lot of time and effort.
Speaker 7 (08:05):
It's that time and effort in creating the shell wampom
that gave it value to the Indian people.
Speaker 1 (08:11):
For thousands of years, gold and silver have been used
as money. We've mined these precious metals and forged them
into coins, each branded with an official stamp by some
trusted third party to guarantee their purity. The work that
went into mining it, refining it, and pressing it into
coins helped establish the value of the coin. Aside from
the few commercial uses, gold and silver didn't necessarily have
(08:34):
any intrinsic value. They had value because everyone agreed that
they had value.
Speaker 3 (08:39):
You know, money is based on face.
Speaker 11 (08:41):
People need to understand that because theft all back in
the days when we use gold would make gold value.
Speaker 3 (08:47):
The answer is people made it valuable.
Speaker 11 (08:48):
They assigned it was valuable and would exchange it for goods.
Speaker 7 (08:52):
But as time passed, the use of gold and silver
coins its currency became inefficient. People needed to trade in
denominations smaller than the value of each coin. They needed
a form of currency that was easier to handle, so,
in part to solve this problem, governments began issuing paper currency.
Speaker 1 (09:11):
In the United States, For many years, our currency, the
US dollar, was backed by gold. This was known as
the gold standard. Our central bank, called the Federal Reserve,
would issue paper money with the total of all US
dollars in circulation representing the physical amount of gold held
by the Treasury Department. The paper itself had no intrinsic value,
(09:32):
but it was a form of accounting that represented an
actual portion of gold. In other words, the dollar was
just an accounting system to keep track of how much
gold everyone owned. The Federal Reserve could not just print
up extra paper money at will. It was generally limited
by the amount of the precious metal held by the Treasury,
but that officially changed in nineteen seventy one.
Speaker 12 (10:01):
I have directed Secretary Connolly and temporarily the convertibility of
the dollar in the gold or other reserve assets accept
in amounts and conditions determined to be in the interest
to monetary stability and in the best interests of the
United States.
Speaker 1 (10:16):
Many believe the United States had unofficially abandoned the gold
standard in the nineteen sixties when our government printed money
to pay for the Vietnam War and President Lyndon B.
Johnson's Great Society programs. But in nineteen seventy one, President
Nixon made leaving the gold standard official.
Speaker 12 (10:33):
Now what does this action, which is very technical, what
does it mean for you? Let me late a rest
the bugaboo of what is called devaluation. If you want
to buy a foreign car or take a trip abroad,
market conditions may cause your dollar to buy slightly less.
But if you are among the overwhelming majority of Americans
(10:58):
who buy American made products in America, your dollar will
be worth just as much tomorrow as it is today.
The effect of this action, in other words, will be
to stabilize the dollar.
Speaker 1 (11:10):
Of course, that wasn't even remotely true. Today the value
of the dollar has plummeted by eighty four percent since
Nixon made that announcement again.
Speaker 9 (11:19):
Billy bambro So, the US system at the moment, and
many other monetary systems around the world, are based on
fractional reserve lending and on central banks deciding how much
money to print went to print at how to manage
the economy.
Speaker 7 (11:37):
From nineteen seventy one on, the US dollar was no
longer backed by gold, but instead it was backed by
a promise from the United States government, its value being
derived by, among other things, how stable the government is
and how much money is in circulation. The US dollar
became just an accounting system of value backed by nothing
(11:57):
but a promise, with the banks acting as a trusted
third party that records the economic transit actions in a
ledger like our bank statements and credit card transaction statements.
With gold no longer restraining how much money was in circulation,
the central bank was free to create US dollars out
of thin air.
Speaker 1 (12:15):
Today every major country has this type of currency system.
Because of the stability of the United States, our currency
became very powerful throughout the world because people trust that
they can safely hold their property in the US dollar
without their assets losing value. Modern Davenezuela, on the other hand,
is unstable, which is why you see their paper currency
(12:36):
littering their streets. It's worthless. But even with the stability
of our government. In the early nineteen eighties, some began
to question our currency system and the government's ability to
monitor almost every financial transaction. At the time, US cryptographer
David Chom expressed the idea of an anonymous electronic money
(12:59):
to avoid Big brother's watchful eye. A cryptographer is someone
that designs safe ways to transfer information electronically without the
information being intercepted or duplicated by a third party.
Speaker 7 (13:11):
A movement began to form around this desire for privacy.
The people drawn to the movement were called cipherpunks, cipher
referring to a secret way of writing what is referred
to in the digital world as encryption.
Speaker 1 (13:24):
In the early nineties, these cipherpunks coalesced around an electronic
mailing list to share their ideas, and the movement slowly grew.
People like wikileak's founder Julian Assange and lesser known names
like US cryptographer Hal Finny were cipher punks by nineteen
ninety seven. The originator of the concept of cryptocurrency. David
(13:45):
Chalm secured some venture capital to start an Internet currency
he called digicash. Other cipher punks also entered the ring,
each attempting to create their own online money that was
as secure and anonymous as cash in the physical world. However,
the idea didn't spread. Rations and merchants weren't so keen
on the concept of anonymous internet cash. They liked capturing
(14:09):
your data from traceable electronic transactions like credit cards, but
perhaps more importantly, consumers weren't lining up to use digital money.
David Choms said at the time, quote As the Web grew,
the average level of sophistication of users dropped. It was
hard to explain the importance of privacy to them end quote.
(14:31):
By the end of nineteen ninety eight, David Chom's digiti
Caash filed for Chapter eleven bankruptcy. The other electronic currency
outfits failed as well. People hadn't yet understood the precious
data they were giving up to big tech companies with
every Internet transaction. And besides, in the late nineties, it
was easy for everyone to open an account with a
(14:52):
bank or a credit card company. They welcomed everyone. No
one was being banned from these financial institutions, so the
demand for a new Internet cash was near zero. Still
by the turn of the millennium, even with the failed
attempts at a cryptocurrency, a few forward thinkers saw the
eventual development of Internet cash that was completely separate from
(15:13):
the US dollar. Again, Milton Friedman.
Speaker 4 (15:16):
So that I think that the Internet is going to
be one of the major forces for reducing the role
of government. The one thing that's missing but that will
soon be developed, is a reliable e cash, a method
whereby on the Internet you can transfer funds from A
to B without a knowing B or B knowing A.
(15:38):
The way in which I can take a twenty dollars
bill and head it over to you, then there's no
record of where it came from, and you may get
that without knowing who I am. That kind of thing
will develop on the Internet.
Speaker 1 (15:53):
The race for a cryptocurrency was largely shelved by the
early two thousands, but little did the cipherpunks know that
their passion was about to be given a rebirth by
a mysterious, anonymous figure, a figure that would develop a
disruptive new technology that could threaten the government's monopoly on
printing money.
Speaker 7 (16:15):
Welcome back, I'm Adriana Coortez. So the race for a
digital cash or cryptocurrency had been largely shelved by the
early two thousands. Corporations and merchants preferred credit card transactions,
where they could capture data on their customers. People also
hadn't yet understood the attack on their online privacy. As
a result, there was no demand for cryptocurrencies. But an
(16:38):
event of global proportions was about to give rise to
a mysterious character that would breathe new life into the idea.
Speaker 13 (16:47):
This was going to be one of the watershed days
in financial market's history.
Speaker 5 (16:50):
It was a manic Monday in the financial markets. The
Dow tumbled more than five hundred points after two pillars
of the Street tumbled over the weekend. Lehman Brothers, a
one hundred and fifty eight year old firm, filed for bankruptcy.
Speaker 4 (17:04):
I don't think anyone really expected a bank as bigg
as Reason to be in a position that it's in.
Speaker 5 (17:09):
Now, brought down by bad mortgage investments. Leman, which has
twenty five thousand employees, will be liquidated.
Speaker 7 (17:16):
With the fall of Lehman Brothers. In the throes of
the two thousand and eight financial crisis, many Americans lost
faith in the United States monetary system. Cipherpunks began revisiting
the idea of a digital currency divorced from the centralized
Federal Reserve, the system that many felt through the global
economy into chaos. On October thirty one, two thousand and eight,
(17:37):
in the midst of the crisis, an unknown web user,
or perhaps a group of users, going by the name
of Satoshi Nakamoto, wrote a white paper entitled Bitcoin a
Peer to Peer Electronic Cash System and published it to
the web address bitcoin dot org. Satoshi then posted a
link to the document on a cryptography mailing list stating quote,
(17:59):
I've been working on a new electronic cash system that's
fully peer to peer with no trusted third party end quote.
Satoshi was proposing a new form of Internet cash. It
was the Napster of currency. The system Satoshi developed was
a decentralized currency system called Bitcoin, one that eliminated the
(18:19):
need for banks as the middleman again, Billy Bambro.
Speaker 9 (18:23):
Because of the two thousand and eight financial crisis in
which Bitcoin was created and can be seen as a
catalyst for interest in bitcoin, people have decided that perhaps
this monetary system is not the best one.
Speaker 7 (18:34):
As we mentioned earlier our US currency, it's just an
accounting system with third parties like banks, credit card companies,
and other financial institutions, all recording transactions and keeping track
of value in one way or another. Each of these
third parties fall under our central bank, the Federal Reserve.
(18:58):
Satoshi designed a system that replaced this centralized banking system
with a decentralized collection of computers that automated the accounting
the banks performed. This automated system, known as the blockchain,
records electronic transactions on a public ledger residing on thousands
of computers all across the world in a way that
(19:20):
is near impossible to hack. The system removed a costly
middleman like Bank of America, Visa, and PayPal that deducts
large fees. This blockchain technology also partially anonymized every transaction,
keeping everyone involved out of the watchful eye of the government.
Satoshi Nakamoto created the first Internet cache. Instead of shells
(19:44):
or gold coins or paper dollars, this new Internet cash
system used bitcoins. The technology was revolutionary. When I send
an email to someone, both I and the person receiving
it have a copy of the email. Satoshi's technology devised
a way to send a digital object, the bitcoin, to
(20:07):
someone without leaving a copy with the sender. So when
I send a Bitcoin to someone to purchase an item
or pay for a service, I no longer have a
copy of the bitcoin. The person I sent it to
now has the possession of that digital coin. It's handed off,
just like cash is. The transaction is recorded into a
public ledger through an automated system of computers throughout the world,
(20:31):
removing the middleman and the fees they may charge. A
key of the system is that the computers that perform
the computation behind these transactions are rewarded with bitcoin. Just
like when people mine mountains in the hopes of finding gold,
These computers compete to perform the computation of bitcoin transactions
in hopes of being rewarded with bitcoins from the system.
(20:54):
As a result, these computers are called miners. Satoshi released
the blockchain computer code that operated this new internet cash
system on January third, two thousand and nine, and the
first transaction was recorded just a few days later, when
Satoshi Nakamoto sent ten bitcoins to a member of the
cipher Punk movement hal Finny. A key feature of this
(21:16):
bitcoin system is that there is a limit to the
amount of bitcoins in circulation. Unlike the US dollar that
can be printed by the Federal Reserve at will, the
maximum number of bitcoins that will ever exist is twenty
one million. Satoshi forced the bitcoin system to mimic the
limits set up by the gold standard, where the number
of US dollars were confined to the amount of gold
(21:38):
in the Treasury Department. This is a very important point today.
As the Federal Reserve continues to print money, the US
dollar loses purchasing power over time because there are more
dollars in circulation. If you think of dollars as shares
of stock in the United States, the more dollars that
there are, the smaller the share of the United States
you own. So the value of a US dollar decreases
(22:00):
from year to year. That's why the price of products
continues to rise every year. It's because your dollars are
losing value. Satoshi wanted to solve this problem of inflation
by limiting the number of bitcoins it could ever be
in circulation to a finite number twenty one million. So
from year to year, the value of bitcoin will not
be diluted like the US dollar. The first known commercial
(22:23):
transaction using bitcoin occurred in twenty ten, when a programmer
named Laslo Hanyax bought two Papa John's pizzas. The price
tag for the two pies ten thousand bitcoins. In December
twenty twenty, the same amount of bitcoin would trade for
roughly two hundred and thirty million dollars. In the first
couple years of bitcoin, few merchants were adopting the cryptocurrency.
(22:45):
It needed a kickstart, one that could prove Bitcoin's ability
to actually serve as digital cash. That would come with
the creation of an online marketplace that would not only
prove the legitimacy of cryptocurrency, but would also show how
much the government feared this new Internet money. The first
brought audience to see the potential of crypto was the Libertarians.
They believed in small government, liberty, and free markets. They
(23:08):
wanted an end to the War on drugs and saw
the Federal Reserve as the key culprit behind the two
thousand and eight financial crisis. One of their leaders, Ron Paul,
called for an end to the FED and a return
to the financial system backed by gold.
Speaker 12 (23:22):
There is no authority in the Constitution authorizing a central bank,
which means there should be no Federal Reserve sess down.
Speaker 7 (23:33):
But even as it became abundantly obvious that our central
banking system played a primary role in the financial crisis,
it also became clear that Washington d c. Was not
going to end the Federal Reserve's reign. The emergence of
bitcoin provided a new revolutionary way forward. If the Federal
Reserve could not be removed, it could just be ignored.
(23:53):
If people adopted cryptocurrency, they could make financial transactions privately
between two consenting adults, without a banking system as the middleman.
Like paper cash, cryptocurrency promised true liberty, a paramount principle
for libertarians.
Speaker 13 (24:17):
I've gone into cryptocurrency very early on.
Speaker 7 (24:20):
That's Curtis Green, author of Silk Road Takedown. After the
financial crisis, Curtis was, like most middle Americans in a
bad financial place. Jobs were not easy to come by.
The Utah native had a bad back, so work options
for Curtis were limited. He began looking for online work
and possible investment opportunities that could produce a quick return.
(24:42):
That's when he ran across a discussion of bitcoin on
a web forum.
Speaker 13 (24:45):
So like that, well this is in our So I
started following a little bit and I wasn't give to
a big time I would and intrigued me and I
Bitcoin talk was up at the time had just started
and that's where ninety nine point nine percent of all
bitcoin discussion was take And so I was on there
quite a bit early on. And as I was reading
(25:08):
the discussion that I learned more of what it can do,
the benefits. I learned about how it's.
Speaker 3 (25:12):
A ledger, and how it I got educated.
Speaker 13 (25:15):
So I saw this bitcoin as being a way of
digital money. They solved a huge problem, the double spend.
Speaker 7 (25:23):
The double spend problem is perhaps the first barrier blocking
most people from taking cryptocurrency seriously. An idea embedded in
all of us is that digital files can easily be copied,
So someone can copy a digital bitcoin. It would allow
a coin to be spent more than once, or the
(25:43):
double spend. So how could internet cash not be counterfeited?
Satoshi Nakamoto solved the double spend problem with bitcoin, but.
Speaker 13 (25:51):
Stoshi, the developer of bitcoin, came up. I don't know
how he figured it out, but he figured out how
to stop this double spend. So if I had one bitcoin,
than it to you. That bitcoin goes to you and
it can't be duplicated. So to me, that was that
was fascinating.
Speaker 7 (26:12):
The more curt Is dug into bitcoin and the blockchain
technology driving it, the more he was sold on the system.
Speaker 13 (26:18):
But as I started learning it intrigued me more and
more and more. I'm like, and this could solve a
lot of problems, and you know, to.
Speaker 3 (26:26):
Be unvan being able to have control of.
Speaker 13 (26:29):
Your own money instead of having one bank or one
person or company being in control, where you can basically
take back that control. And that's why it's revolutionary and
it's going to change the way we do think. I
put blockchain, and that's why I use blockchain as a cryptocurrency,
because blockchain is the technology behind cryptocurrency. That's what I
(26:52):
put blockchain technology up there to the invention of the
cell phone, to the invention of a computer. That's what
it's going to do to help liberate this and help
us with our daily lives in the future.
Speaker 7 (27:05):
To try and make money from this new movement currency,
he set up his computer to become a minor, configuring
his hard drive to help with the computations behind bitcoin transactions.
When his computer performed this computational task successfully, he received
a reward a small amount of bitcoin. As time went on,
he started to generate some income from this, and he
(27:27):
wanted to connect with other enthusiasts of the cryptocurrency.
Speaker 3 (27:30):
And then all of a.
Speaker 13 (27:31):
Sudden, I was looking for more places to talk about bitcoin. Well,
the silk oxite came up.
Speaker 7 (27:39):
But what Curtis didn't know at the time was that
the website's silk Road was about to become a target
of some of the most powerful institutions in the world.
Do you want to hear red Pilled America stories ad free,
then become a backstage subscriber. Just log onto Redpilled America
(28:00):
dot com and click join in the top menu. K
today and help us save America one story at a time.
Speaker 1 (28:07):
Welcome back to Red Pilled America. So as Curtis became
more fascinated by the potential of bitcoin, he began searching
for other places to talk about the cryptocurrency. The website
silk Road began to pop up in online message forms
as the place to be for the Bitcoin revolution. Silk
Road was an anonymous online marketplace located on what's called
(28:29):
the dark Web. As we promised at the onset of
this show, an entirely new language comes with the discussion
of bitcoin. So before getting into Silk Road, you'll need
to understand what exactly is the dark web. The dark
Web is a collection of websites that cannot be found
by searching Google or through normal web browsers. It's actually
(28:51):
even bigger than the regular Internet. The only way to
get to a website on the dark Web is to
use a web browser called the Onion router or tour
for short. Think of the dark web as an alternative
Internet universe, invisible to normal Web telescopes like Google or
browsers like Safari or Chrome on the regular Internet. Anyone
attempting to track you can easily find your real identity,
(29:13):
your physical location, all of the websites you visited, what
kind of computer you using, your operating system, your browser.
They can follow you wherever you go next and gather
information all along the way, including even your weblogins and
credit card info. Your so called private information is typically
out there for anyone to exploit if they are savvy enough. Tour,
(29:35):
on the other hand, allows web users to browse through
an encrypted network, protecting the privacy and identity of all
of its users. It does this with several layers of
encryption around the user, hiding all of the user's private
information and what could be thought of as a digitally
locked box that can only be opened with a key
to add an extra layer of security. When a tour
(29:56):
user punches in an address for a website on the
dark Web, tour does not take them directly to the website.
The browser instead route the user through multiple tour servers
all across the world before reaching the intended website, making
it near impossible for anyone to track the identity and
original address of the user. Websites on the dark Web
(30:16):
only allow the tour browser to connect to their site
to increase the privacy and security of its users. The
dark web allows people to send emails, texts, and other
communications privately and anonymously. This is how many journalists speak
to whistleblowers, and how citizens in countries like China or
Iran communicate safely and avoid the censorship of their governments.
(30:38):
Using the dark Web is how the famed publisher Wikiliks
communicates privately with whistleblowers that give them leaked data. Like
the DNC emails during the twenty sixteen election. This may
lead many people to believe that the dark web is
(31:00):
a network set up by anarchists and outlaws. The Tor
browser was actually designed in the mid nineteen nineties by
the Navy to protect US intelligence communications. Online tour gave journalists,
their sources, dissidents, informants, activists, and others a way to
communicate with intelligence agents without fear of being discovered. The
silk Road website that Curtis had heard about on the
(31:22):
bitcoin forums lived on this dark web, so he decided
to check it out. What he found out was that
silk Road was an e commerce website on the dark web,
like eBay or Amazon, but the site emphasized anonymity and security.
To do this, it married tore and bitcoin. The only
way to visit silk Road was through the Tor browser,
(31:43):
and the only way to purchase products on the site
was with bitcoin, making the entire transaction between the seller, buyer,
and website anonymous. And it was also the first massive
trial for the use of bitcoin as Internet cash, and
it was quickly becoming a phenomenal success. In addition to
the marketplace, silk Road had community forums where people talked
(32:06):
and helped each other solve problems. Curtis was drawn to
these forums.
Speaker 13 (32:10):
They were talking about bitcoin, they were talking about it
was a community, and there was there was the merchant
side where the stuff was sold, and there was also
then there was the community threads and and that's what
is really interesting.
Speaker 1 (32:25):
Community boards like these can be found all across the
regular Internet. Places like Reddit, four chan, and the comment
sections of websites are just message boards where people gathered
to communicate with like minded folks. The boards on Silk
Road were just the dark Web version of those message boards.
Curtis became acclimated with the predominant philosophy behind the core users.
Speaker 13 (32:46):
Of the site, and then obviously I looked and I
saw there's these things that you know, libertarian view, where
you know, we should be able to put into our
own bodies what we want as long as we don't
harm the third person.
Speaker 1 (32:58):
Many on the Silk Road message board were anarcho capitalists,
a form of liberty marianism that has a radical view
on capitalism, free markets, and the role of the state.
They advocate for an elimination of the centralized state that
they view as an oppressor that always rules by force
and diminishes freedom. The silk Road administrator himself would post
(33:18):
on the message board that the site was founded on
libertarian principles. Silk Road users vehemently opposed the war on
drugs and felt they should in fact be legalized because,
in their view, besides the principle that people should be
able to put in their bodies whatever they want. Many
libertarians on these message boards believe that the war on
drugs was unwinnable. They thought legalizing drugs would reduce the
(33:40):
violence associated with the street trade. Because of the anonymous
nature of silk Road and the emergence of the Internet
cash bitcoin, silk Road became an extraordinary petri dish to
experiment with these libertarian free market ideas. People sold all
kinds of items on the site.
Speaker 3 (33:56):
Well, you get.
Speaker 13 (33:57):
Anything on that. You could buy shirts, you could buy computers,
you could buy thought and it was all they yet
because one of the rules is you couldn't lift something
on them that would harm a third person.
Speaker 1 (34:13):
But the items that were most prominent on the site,
the product that would eventually make silk Road and national headline,
were the drugs.
Speaker 13 (34:20):
I think it was seventy seven percent of the drugs
that were on the site was marijuana, and so the
grand majority was the substance of.
Speaker 3 (34:31):
Legal in I don't know how many states now.
Speaker 13 (34:34):
Even in Utah they just legalized the.
Speaker 1 (34:36):
Medical marijuana, But the other twenty three percent included MDMA
or ecstasy, cocaine, heroin, LSD, meth, mushrooms, and other illegal substances.
How much of these were actually being sold was unknown,
but they were no doubt listed for sale on the site.
Enthusiasts of silk Road believed that the portal itself was
helping reduce the violence associated with the procurement of these
(34:58):
substances on the streets because the people would be buying
them with or with out the Silk Road marketplace. Many
believed making the transaction anonymous and shipped rather than hand
it off in some back alley, eliminated the potential of
violence at the point of sale. Drugs have always been
illegally sold online, but the emergence of the dark Web
and bitcoin made silk Road the right idea at the
(35:21):
right time for this type of illegal marketplace. Curtis had
libertarian leanings and believes people should generally be able to
do what they want to do with their body, as
long as it doesn't hurt another person.
Speaker 13 (35:34):
I don't drink, but if I want to drink, I
want to be be able to drink. As long as
I don't get in the car and drive drunk and
kill somebody. Then what I do in my own is
by this.
Speaker 1 (35:45):
But he says drugs weren't the reason why he was
at the site. It was the community board and their
discussions of bitcoin.
Speaker 3 (35:51):
I didn't go there.
Speaker 14 (35:51):
Because the drug, but I'm not I want to drug
you or don't. I've ever taken an illegal street drug
in my life. But when I got there, I noticed
that people they weren't talking about that. They were cockying
more about cryptocurrency.
Speaker 1 (36:04):
But even with illegal drugs being sold, the site oddly
wasn't anything goes. They had their own community rules. The
site administrators didn't allow anything to be sold on the
site that harmed innocent people or was necessary to harm
innocent people to be brought to market. They prohibited counterfeit money,
stolen items, intentional fraud, em pirated software. Hit men were
(36:26):
also not allowed, and neither was child pornography. Anything else
that didn't meet these criteria was fair game. The site's
community believed silk Road helped people avoid the regulation of
the state and their eyes an oppressive entity that attempted
to control every aspect of people's lives. They thought silk
Road was a way to take back control from the government.
(36:48):
While on Silk Road, Curtis obviously saw the drugs for
sale and noticed people talking about them on the community board.
Speaker 13 (36:55):
I saw the people were buying substances that were very questionable,
and so I came.
Speaker 3 (37:02):
Up the idea. It was called a heart reduction.
Speaker 1 (37:05):
He thought starting a harm reduction form on the site
could help addicts and others expressing an interest in self harm.
Years earlier, Curtis earned his AMT license and worked as
a volunteer on an ambulance.
Speaker 13 (37:17):
And I wanted to help people that got you because
I have admit at the background, and to help them
if you know they wanted wanted to cut suicide or
they were wanting to think about doing drive, because I would,
I wouldn't steer them away from it.
Speaker 1 (37:41):
At the time in twenty eleven, the creator of silk
Road wasn't known, but there was a function to send
a message to the site administrator. So Curtis reached out
to the admin and brought up the idea of starting
a harm reduction.
Speaker 13 (37:53):
Form and I said, hey, I think this would be
a great idea, and he thought it was awesome. He thought,
oh yeah, we need definitely need that. So he and
then he said, oh, by the way, you're going to moderate.
So that's basically how why he got pled was still
through it. It was just it was basically to help
people with their issues.
Speaker 1 (38:11):
The Silk Road administrator set up Curtis as the moderator
of this forum, giving him more access to the site
than general visitors. But Curtis couldn't have known that by
taking on this role, his life was about to change forever.
Before it was all done, federal agents would raid his home,
torture him, fake his death, and framed him for a
(38:31):
crime that threatened to put him in prison for life.
And at the bottom of it all was a little
thing called Bitcoin.
Speaker 15 (38:38):
It's a certifiable one stop shop for illegal drugs that
represents the most brazen attempt the pedal drugs online that
we have ever seen. It's more brazen than anything else
by light years.
Speaker 1 (38:51):
Coming up in part two of Crypto and.
Speaker 13 (38:54):
That's the ninety went and stole all the money and
tried to blame me for it. It was twenty five
thousand bitcoins.
Speaker 3 (39:00):
The day that the word hundreds of millions of dollars.
Speaker 10 (39:03):
Road was a marginal company. Why do they target it?
Because Wall Street wanted to shoy Bitcoin before it could
get big enough to compete for them, because a lot
of people don't want to have to deal with central bankers.
Speaker 6 (39:13):
And I think it's political, and I think it's also
about the bitcoin, and in fact that NSA was urgently
targeting bitcoin users a few months before the silk Robe
was taken down and Ross was arrested.
Speaker 11 (39:26):
The Chinese now use bitcoin to get money in and
out of the country, so they can't otherwise get in
and out. The same thing with the Koreans. And the
real question becomes is just like armies. You know it's
illegal to have a private army in the United States,
should it be I legal to.
Speaker 3 (39:40):
Have private money?
Speaker 7 (39:42):
Red Pilled America is an iHeartRadio original podcast. It's owned
and produced by Patrick Carrelci and me Adrianna Cortez of
Informed Ventures. Now you can get ad free access to
our entire archive of episodes by becoming a backstage subscriber.
To subscribe, visit redpilled america dot com and click join
in the top menu. That's red pilled America dot com
(40:03):
and click join in the top menu. Thanks for listening. M.
This is red Pilled America. Bitcoin has been one of
the most fascinating and controversial developments in the history of
monetary technology. When Red Pilled America did our first deep
dive into bitcoin called Crypto in July twenty nineteen, each
bitcoin hovered around nine thousand dollars. When we did our
second deep dive called Crypto Revisited in January twenty twenty three,
(00:24):
it was at about sixteen thousand dollars. Today, as I
record this, it's hovering at almost sixty five thousand dollars
per coin, in almost seven times increase in seven years.
That seems impressive until you realize that over the past
seven months, the value of a bitcoin has been cut
by almost half its all time high of one hundred
and twenty six thousand dollars. Next week, on July twenty ninth,
(00:46):
the FED Chairman is expected to provide big news that
will impact the economy, Wall Street and bitcoin. So to
provide a refresher over the next week, we'll be republishing
both our deep dives on Crypto. Where is Crypto Going?
After listening to these six episodes, tell us what you
think and don't forget to become a Backstage subscriber, where
you get add free access to our entire back catalog
(01:08):
of episodes. Just go to Redpilled America dot com and
click join in the top of the menu. Now on
with the show. If you haven't heard about bitcoin by now,
you must be living under a rock.
Speaker 2 (01:23):
Bitcoin.
Speaker 3 (01:24):
Bitcoin.
Speaker 4 (01:24):
That was the moment that I wanted to use bitcoin.
Speaker 5 (01:27):
I personally I own bitcoin in my hedge fond.
Speaker 6 (01:29):
Do you think this is a currency, a currency that's
really going to work eventually? Well?
Speaker 1 (01:33):
I think it is what this internet. Cash has become
all the buzz, But recently the hype has taken a
different turn. Many powerful people seem to fear digital currencies.
Speaker 6 (01:44):
Hey, look for colleagues to join with me and introducing
a bill to outlaw cryptocurrency.
Speaker 1 (01:50):
With all of these economists, bankers and politicians raising a
red flag about the emergence of digital cash, it got
us to thinking, is bitcoin dangerous to America?
Speaker 7 (02:03):
I'm Patrick CARELCI and I'm Adriana Cortez.
Speaker 1 (02:06):
And this is Red Pilled America, a storytelling show.
Speaker 7 (02:11):
This is not another talk show covering the day's news.
We are all about telling stories.
Speaker 1 (02:16):
Stories Hollywood doesn't want you to hear stories.
Speaker 7 (02:19):
The media marks stories about everyday Americans of the globalist ignore.
Speaker 1 (02:25):
You could think of red Pilled America as audio documentaries,
and we promise only one thing, the truth. Welcome to
red Pilled America. Is Bitcoin dangerous to America. The topic
(02:50):
has been popping up more and more on our screens,
but the speculation was sent into overdrive after President Trump
condemned bitcoin and other new digital currencies.
Speaker 8 (02:59):
A crypto is being talked about. The President actually weighed
in and tweeted about cryptocurrencies last night. He wrote in
part this, I'm not a fan of bitcoin and other cryptocurrencies,
which are not money and whose value is highly volatile
based on thin air. He writes, unregulated crypto assets can
facilitate unlawful behavior, including drug trade and other illegal activity
rights the present.
Speaker 1 (03:20):
To get to the bottom of bitcoin, we'll first look
into the origin of this tech phenomenon. We'll talk to
a few experts on its emergence and impact on America,
and we'll hear a story about the lengths to which
the United States government has gone to halt its growth.
But I want to warn you here before we get started.
At first glance, the topic of bitcoin seems complicated, It
(03:42):
has its own language and challenges the way we think
of money. That said, if you stay with us, you'll
know more about bitcoin than most And today that's vital
because some say the disruptive technology driving this new phenomenon
could even be bigger than the Internet. Understanding bitcoin has
now become mandatory.
Speaker 9 (04:12):
A lot of people say that in bitcoin or internet
terms with it in like the nineteen eighties.
Speaker 10 (04:16):
What would happen, for example, if golf nations, rather than
trading oil and dollars, moved to bitcoin. That would I think,
destroy America as a global empire.
Speaker 3 (04:27):
You know, governments are worried. However, I don't know that
anybody can prevent it.
Speaker 6 (04:31):
They need an escapegoat, and Roster's their scapegoat. And I
think I personally think it was because of the bitcoin.
Speaker 1 (04:38):
Everyone is talking about bitcoin, but what is it? Simply put,
it's a new currency system. When we think of money,
our minds typically conjure up images of greenbacks, US dollars,
that physical paper money we sometimes carry in our wallets.
Speaker 7 (04:54):
Bitcoin is also considered money, but it's a brand new
form of currency that only comes in electronic form. There
is no physical coin or bit bill. This kind of
digital money is called cryptocurrency.
Speaker 3 (05:11):
Yeah.
Speaker 9 (05:12):
I think the simplest way to think about Bitcoin and
other cryptocurrencies, all of which do stem from Bitcoin originally,
is best thought of as Internet cash.
Speaker 7 (05:23):
That's Billy Bambra, a freelance journalist. It's been covering cryptocurrencies
since twenty twelve.
Speaker 9 (05:29):
Just like you have cash that you use in a store,
Bitcoin or other forms of cryptocurrencies are or could be
considered cash that you use on the Internet. So it's
digital cash. It doesn't fit quite into the same definitions
of a traditional currency. It doesn't fit quite the definitions
of a traditional commodity like gold. It's somewhere in between.
(05:50):
The exact use case has not quite been pinned down yet.
Because it is something entirely new.
Speaker 7 (05:56):
Internet cash is a brand new, disruptive development in currency.
The history of money helps illustrate this fact.
Speaker 1 (06:08):
Before we had currency, people had to rely on the
barter system, or you would trade something of value that
you possessed for something of value that someone else possessed.
For example, your stockpile of furs were a form of
currency to purchase, say a bale of wheat that you needed.
But often there was a problem what you had of
value wasn't always what someone else wanted in a barter deal.
(06:30):
Person A may have had a bale of wheat that
you wanted, but they didn't need furs, so the trade
wouldn't happen. You'd have to find out what person A wanted.
Let's say they needed wood. Then you'd have to find
person B that had wood and trade your furs with
that person, assuming they wanted furs. Then you could take
your newly acquired wood and go back to person A
(06:51):
and trade your wood for their wheat, that is, assuming
they still had the wheat. As you can see, bartering
was a bit complicated, and as societies grew it became
even more difficult. Need for currency arose in order to
facilitate trading.
Speaker 7 (07:09):
Throughout history, people have used all kinds of physical currency.
Speaker 2 (07:14):
There's hardly anything that hasn't been used for money.
Speaker 7 (07:17):
That's the latent. Famed economist Milton Friedman.
Speaker 2 (07:20):
Rock salt in Ethiopia, brass rings in West Africa, cowrie
shells in Uganda, crocodile money in Malaysia. I'm sir, it
isn't it. Even a toy cannon. Anything can be used
as money.
Speaker 7 (07:33):
Most pre industrial Revolution, cultures decided on some form of
currency to facilitate trade.
Speaker 11 (07:39):
Look, the most important thing with a currency, for example,
the Indian shell wapam, which would basically beats, is that
it be limited in supply.
Speaker 3 (07:48):
What limited the supply of shell wapam was. It was
difficult to make.
Speaker 7 (07:52):
That's economist Peter Maurice, Professor emeritus at the University of
Maryland Robert H. Smith's School of Business.
Speaker 11 (07:59):
Anybody could make it in the Indian community. However, it
took a lot of time and effort.
Speaker 7 (08:05):
It's that time and effort in creating the shell wampom
that gave it value to the Indian people.
Speaker 1 (08:11):
For thousands of years, gold and silver have been used
as money. We've mined these precious metals and forged them
into coins, each branded with an official stamp by some
trusted third party to guarantee their purity. The work that
went into mining it, refining it, and pressing it into
coins helped establish the value of the coin. Aside from
the few commercial uses, gold and silver didn't necessarily have
(08:34):
any intrinsic value. They had value because everyone agreed that
they had value.
Speaker 3 (08:39):
You know, money is based on face.
Speaker 11 (08:41):
People need to understand that because theft all back in
the days when we use gold would make gold value.
Speaker 3 (08:47):
The answer is people made it valuable.
Speaker 11 (08:48):
They assigned it was valuable and would exchange it for goods.
Speaker 7 (08:52):
But as time passed, the use of gold and silver
coins its currency became inefficient. People needed to trade in
denominations smaller than the value of each coin. They needed
a form of currency that was easier to handle, so,
in part to solve this problem, governments began issuing paper currency.
Speaker 1 (09:11):
In the United States, For many years, our currency, the
US dollar, was backed by gold. This was known as
the gold standard. Our central bank, called the Federal Reserve,
would issue paper money with the total of all US
dollars in circulation representing the physical amount of gold held
by the Treasury Department. The paper itself had no intrinsic value,
(09:32):
but it was a form of accounting that represented an
actual portion of gold. In other words, the dollar was
just an accounting system to keep track of how much
gold everyone owned. The Federal Reserve could not just print
up extra paper money at will. It was generally limited
by the amount of the precious metal held by the Treasury,
but that officially changed in nineteen seventy one.
Speaker 12 (10:01):
I have directed Secretary Connolly and temporarily the convertibility of
the dollar in the gold or other reserve assets accept
in amounts and conditions determined to be in the interest
to monetary stability and in the best interests of the
United States.
Speaker 1 (10:16):
Many believe the United States had unofficially abandoned the gold
standard in the nineteen sixties when our government printed money
to pay for the Vietnam War and President Lyndon B.
Johnson's Great Society programs. But in nineteen seventy one, President
Nixon made leaving the gold standard official.
Speaker 12 (10:33):
Now what does this action, which is very technical, what
does it mean for you? Let me late a rest
the bugaboo of what is called devaluation. If you want
to buy a foreign car or take a trip abroad,
market conditions may cause your dollar to buy slightly less.
But if you are among the overwhelming majority of Americans
(10:58):
who buy American made products in America, your dollar will
be worth just as much tomorrow as it is today.
The effect of this action, in other words, will be
to stabilize the dollar.
Speaker 1 (11:10):
Of course, that wasn't even remotely true. Today the value
of the dollar has plummeted by eighty four percent since
Nixon made that announcement again.
Speaker 9 (11:19):
Billy bambro So, the US system at the moment, and
many other monetary systems around the world, are based on
fractional reserve lending and on central banks deciding how much
money to print went to print at how to manage
the economy.
Speaker 7 (11:37):
From nineteen seventy one on, the US dollar was no
longer backed by gold, but instead it was backed by
a promise from the United States government, its value being
derived by, among other things, how stable the government is
and how much money is in circulation. The US dollar
became just an accounting system of value backed by nothing
(11:57):
but a promise, with the banks acting as a trusted
third party that records the economic transit actions in a
ledger like our bank statements and credit card transaction statements.
With gold no longer restraining how much money was in circulation,
the central bank was free to create US dollars out
of thin air.
Speaker 1 (12:15):
Today every major country has this type of currency system.
Because of the stability of the United States, our currency
became very powerful throughout the world because people trust that
they can safely hold their property in the US dollar
without their assets losing value. Modern Davenezuela, on the other hand,
is unstable, which is why you see their paper currency
(12:36):
littering their streets. It's worthless. But even with the stability
of our government. In the early nineteen eighties, some began
to question our currency system and the government's ability to
monitor almost every financial transaction. At the time, US cryptographer
David Chom expressed the idea of an anonymous electronic money
(12:59):
to avoid Big brother's watchful eye. A cryptographer is someone
that designs safe ways to transfer information electronically without the
information being intercepted or duplicated by a third party.
Speaker 7 (13:11):
A movement began to form around this desire for privacy.
The people drawn to the movement were called cipherpunks, cipher
referring to a secret way of writing what is referred
to in the digital world as encryption.
Speaker 1 (13:24):
In the early nineties, these cipherpunks coalesced around an electronic
mailing list to share their ideas, and the movement slowly grew.
People like wikileak's founder Julian Assange and lesser known names
like US cryptographer Hal Finny were cipher punks by nineteen
ninety seven. The originator of the concept of cryptocurrency. David
(13:45):
Chalm secured some venture capital to start an Internet currency
he called digicash. Other cipher punks also entered the ring,
each attempting to create their own online money that was
as secure and anonymous as cash in the physical world. However,
the idea didn't spread. Rations and merchants weren't so keen
on the concept of anonymous internet cash. They liked capturing
(14:09):
your data from traceable electronic transactions like credit cards, but
perhaps more importantly, consumers weren't lining up to use digital money.
David Choms said at the time, quote As the Web grew,
the average level of sophistication of users dropped. It was
hard to explain the importance of privacy to them end quote.
(14:31):
By the end of nineteen ninety eight, David Chom's digiti
Caash filed for Chapter eleven bankruptcy. The other electronic currency
outfits failed as well. People hadn't yet understood the precious
data they were giving up to big tech companies with
every Internet transaction. And besides, in the late nineties, it
was easy for everyone to open an account with a
(14:52):
bank or a credit card company. They welcomed everyone. No
one was being banned from these financial institutions, so the
demand for a new Internet cash was near zero. Still
by the turn of the millennium, even with the failed
attempts at a cryptocurrency, a few forward thinkers saw the
eventual development of Internet cash that was completely separate from
(15:13):
the US dollar. Again, Milton Friedman.
Speaker 4 (15:16):
So that I think that the Internet is going to
be one of the major forces for reducing the role
of government. The one thing that's missing but that will
soon be developed, is a reliable e cash, a method
whereby on the Internet you can transfer funds from A
to B without a knowing B or B knowing A.
(15:38):
The way in which I can take a twenty dollars
bill and head it over to you, then there's no
record of where it came from, and you may get
that without knowing who I am. That kind of thing
will develop on the Internet.
Speaker 1 (15:53):
The race for a cryptocurrency was largely shelved by the
early two thousands, but little did the cipherpunks know that
their passion was about to be given a rebirth by
a mysterious, anonymous figure, a figure that would develop a
disruptive new technology that could threaten the government's monopoly on
printing money.
Speaker 7 (16:15):
Welcome back, I'm Adriana Coortez. So the race for a
digital cash or cryptocurrency had been largely shelved by the
early two thousands. Corporations and merchants preferred credit card transactions,
where they could capture data on their customers. People also
hadn't yet understood the attack on their online privacy. As
a result, there was no demand for cryptocurrencies. But an
(16:38):
event of global proportions was about to give rise to
a mysterious character that would breathe new life into the idea.
Speaker 13 (16:47):
This was going to be one of the watershed days
in financial market's history.
Speaker 5 (16:50):
It was a manic Monday in the financial markets. The
Dow tumbled more than five hundred points after two pillars
of the Street tumbled over the weekend. Lehman Brothers, a
one hundred and fifty eight year old firm, filed for bankruptcy.
Speaker 4 (17:04):
I don't think anyone really expected a bank as bigg
as Reason to be in a position that it's in.
Speaker 5 (17:09):
Now, brought down by bad mortgage investments. Leman, which has
twenty five thousand employees, will be liquidated.
Speaker 7 (17:16):
With the fall of Lehman Brothers. In the throes of
the two thousand and eight financial crisis, many Americans lost
faith in the United States monetary system. Cipherpunks began revisiting
the idea of a digital currency divorced from the centralized
Federal Reserve, the system that many felt through the global
economy into chaos. On October thirty one, two thousand and eight,
(17:37):
in the midst of the crisis, an unknown web user,
or perhaps a group of users, going by the name
of Satoshi Nakamoto, wrote a white paper entitled Bitcoin a
Peer to Peer Electronic Cash System and published it to
the web address bitcoin dot org. Satoshi then posted a
link to the document on a cryptography mailing list stating quote,
(17:59):
I've been working on a new electronic cash system that's
fully peer to peer with no trusted third party end quote.
Satoshi was proposing a new form of Internet cash. It
was the Napster of currency. The system Satoshi developed was
a decentralized currency system called Bitcoin, one that eliminated the
(18:19):
need for banks as the middleman again, Billy Bambro.
Speaker 9 (18:23):
Because of the two thousand and eight financial crisis in
which Bitcoin was created and can be seen as a
catalyst for interest in bitcoin, people have decided that perhaps
this monetary system is not the best one.
Speaker 7 (18:34):
As we mentioned earlier our US currency, it's just an
accounting system with third parties like banks, credit card companies,
and other financial institutions, all recording transactions and keeping track
of value in one way or another. Each of these
third parties fall under our central bank, the Federal Reserve.
(18:58):
Satoshi designed a system that replaced this centralized banking system
with a decentralized collection of computers that automated the accounting
the banks performed. This automated system, known as the blockchain,
records electronic transactions on a public ledger residing on thousands
of computers all across the world in a way that
(19:20):
is near impossible to hack. The system removed a costly
middleman like Bank of America, Visa, and PayPal that deducts
large fees. This blockchain technology also partially anonymized every transaction,
keeping everyone involved out of the watchful eye of the government.
Satoshi Nakamoto created the first Internet cache. Instead of shells
(19:44):
or gold coins or paper dollars, this new Internet cash
system used bitcoins. The technology was revolutionary. When I send
an email to someone, both I and the person receiving
it have a copy of the email. Satoshi's technology devised
a way to send a digital object, the bitcoin, to
(20:07):
someone without leaving a copy with the sender. So when
I send a Bitcoin to someone to purchase an item
or pay for a service, I no longer have a
copy of the bitcoin. The person I sent it to
now has the possession of that digital coin. It's handed off,
just like cash is. The transaction is recorded into a
public ledger through an automated system of computers throughout the world,
(20:31):
removing the middleman and the fees they may charge. A
key of the system is that the computers that perform
the computation behind these transactions are rewarded with bitcoin. Just
like when people mine mountains in the hopes of finding gold,
These computers compete to perform the computation of bitcoin transactions
in hopes of being rewarded with bitcoins from the system.
(20:54):
As a result, these computers are called miners. Satoshi released
the blockchain computer code that operated this new internet cash
system on January third, two thousand and nine, and the
first transaction was recorded just a few days later, when
Satoshi Nakamoto sent ten bitcoins to a member of the
cipher Punk movement hal Finny. A key feature of this
(21:16):
bitcoin system is that there is a limit to the
amount of bitcoins in circulation. Unlike the US dollar that
can be printed by the Federal Reserve at will, the
maximum number of bitcoins that will ever exist is twenty
one million. Satoshi forced the bitcoin system to mimic the
limits set up by the gold standard, where the number
of US dollars were confined to the amount of gold
(21:38):
in the Treasury Department. This is a very important point today.
As the Federal Reserve continues to print money, the US
dollar loses purchasing power over time because there are more
dollars in circulation. If you think of dollars as shares
of stock in the United States, the more dollars that
there are, the smaller the share of the United States
you own. So the value of a US dollar decreases
(22:00):
from year to year. That's why the price of products
continues to rise every year. It's because your dollars are
losing value. Satoshi wanted to solve this problem of inflation
by limiting the number of bitcoins it could ever be
in circulation to a finite number twenty one million. So
from year to year, the value of bitcoin will not
be diluted like the US dollar. The first known commercial
(22:23):
transaction using bitcoin occurred in twenty ten, when a programmer
named Laslo Hanyax bought two Papa John's pizzas. The price
tag for the two pies ten thousand bitcoins. In December
twenty twenty, the same amount of bitcoin would trade for
roughly two hundred and thirty million dollars. In the first
couple years of bitcoin, few merchants were adopting the cryptocurrency.
(22:45):
It needed a kickstart, one that could prove Bitcoin's ability
to actually serve as digital cash. That would come with
the creation of an online marketplace that would not only
prove the legitimacy of cryptocurrency, but would also show how
much the government feared this new Internet money. The first
brought audience to see the potential of crypto was the Libertarians.
They believed in small government, liberty, and free markets. They
(23:08):
wanted an end to the War on drugs and saw
the Federal Reserve as the key culprit behind the two
thousand and eight financial crisis. One of their leaders, Ron Paul,
called for an end to the FED and a return
to the financial system backed by gold.
Speaker 12 (23:22):
There is no authority in the Constitution authorizing a central bank,
which means there should be no Federal Reserve sess down.
Speaker 7 (23:33):
But even as it became abundantly obvious that our central
banking system played a primary role in the financial crisis,
it also became clear that Washington d c. Was not
going to end the Federal Reserve's reign. The emergence of
bitcoin provided a new revolutionary way forward. If the Federal
Reserve could not be removed, it could just be ignored.
(23:53):
If people adopted cryptocurrency, they could make financial transactions privately
between two consenting adults, without a banking system as the middleman.
Like paper cash, cryptocurrency promised true liberty, a paramount principle
for libertarians.
Speaker 13 (24:17):
I've gone into cryptocurrency very early on.
Speaker 7 (24:20):
That's Curtis Green, author of Silk Road Takedown. After the
financial crisis, Curtis was, like most middle Americans in a
bad financial place. Jobs were not easy to come by.
The Utah native had a bad back, so work options
for Curtis were limited. He began looking for online work
and possible investment opportunities that could produce a quick return.
(24:42):
That's when he ran across a discussion of bitcoin on
a web forum.
Speaker 13 (24:45):
So like that, well this is in our So I
started following a little bit and I wasn't give to
a big time I would and intrigued me and I
Bitcoin talk was up at the time had just started
and that's where ninety nine point nine percent of all
bitcoin discussion was take And so I was on there
quite a bit early on. And as I was reading
(25:08):
the discussion that I learned more of what it can do,
the benefits. I learned about how it's.
Speaker 3 (25:12):
A ledger, and how it I got educated.
Speaker 13 (25:15):
So I saw this bitcoin as being a way of
digital money. They solved a huge problem, the double spend.
Speaker 7 (25:23):
The double spend problem is perhaps the first barrier blocking
most people from taking cryptocurrency seriously. An idea embedded in
all of us is that digital files can easily be copied,
So someone can copy a digital bitcoin. It would allow
a coin to be spent more than once, or the
(25:43):
double spend. So how could internet cash not be counterfeited?
Satoshi Nakamoto solved the double spend problem with bitcoin, but.
Speaker 13 (25:51):
Stoshi, the developer of bitcoin, came up. I don't know
how he figured it out, but he figured out how
to stop this double spend. So if I had one bitcoin,
than it to you. That bitcoin goes to you and
it can't be duplicated. So to me, that was that
was fascinating.
Speaker 7 (26:12):
The more curt Is dug into bitcoin and the blockchain
technology driving it, the more he was sold on the system.
Speaker 13 (26:18):
But as I started learning it intrigued me more and
more and more. I'm like, and this could solve a
lot of problems, and you know, to.
Speaker 3 (26:26):
Be unvan being able to have control of.
Speaker 13 (26:29):
Your own money instead of having one bank or one
person or company being in control, where you can basically
take back that control. And that's why it's revolutionary and
it's going to change the way we do think. I
put blockchain, and that's why I use blockchain as a cryptocurrency,
because blockchain is the technology behind cryptocurrency. That's what I
(26:52):
put blockchain technology up there to the invention of the
cell phone, to the invention of a computer. That's what
it's going to do to help liberate this and help
us with our daily lives in the future.
Speaker 7 (27:05):
To try and make money from this new movement currency,
he set up his computer to become a minor, configuring
his hard drive to help with the computations behind bitcoin transactions.
When his computer performed this computational task successfully, he received
a reward a small amount of bitcoin. As time went on,
he started to generate some income from this, and he
(27:27):
wanted to connect with other enthusiasts of the cryptocurrency.
Speaker 3 (27:30):
And then all of a.
Speaker 13 (27:31):
Sudden, I was looking for more places to talk about bitcoin. Well,
the silk oxite came up.
Speaker 7 (27:39):
But what Curtis didn't know at the time was that
the website's silk Road was about to become a target
of some of the most powerful institutions in the world.
Do you want to hear red Pilled America stories ad free,
then become a backstage subscriber. Just log onto Redpilled America
(28:00):
dot com and click join in the top menu. K
today and help us save America one story at a time.
Speaker 1 (28:07):
Welcome back to Red Pilled America. So as Curtis became
more fascinated by the potential of bitcoin, he began searching
for other places to talk about the cryptocurrency. The website
silk Road began to pop up in online message forms
as the place to be for the Bitcoin revolution. Silk
Road was an anonymous online marketplace located on what's called
(28:29):
the dark Web. As we promised at the onset of
this show, an entirely new language comes with the discussion
of bitcoin. So before getting into Silk Road, you'll need
to understand what exactly is the dark web. The dark
Web is a collection of websites that cannot be found
by searching Google or through normal web browsers. It's actually
(28:51):
even bigger than the regular Internet. The only way to
get to a website on the dark Web is to
use a web browser called the Onion router or tour
for short. Think of the dark web as an alternative
Internet universe, invisible to normal Web telescopes like Google or
browsers like Safari or Chrome on the regular Internet. Anyone
attempting to track you can easily find your real identity,
(29:13):
your physical location, all of the websites you visited, what
kind of computer you using, your operating system, your browser.
They can follow you wherever you go next and gather
information all along the way, including even your weblogins and
credit card info. Your so called private information is typically
out there for anyone to exploit if they are savvy enough. Tour,
(29:35):
on the other hand, allows web users to browse through
an encrypted network, protecting the privacy and identity of all
of its users. It does this with several layers of
encryption around the user, hiding all of the user's private
information and what could be thought of as a digitally
locked box that can only be opened with a key
to add an extra layer of security. When a tour
(29:56):
user punches in an address for a website on the
dark Web, tour does not take them directly to the website.
The browser instead route the user through multiple tour servers
all across the world before reaching the intended website, making
it near impossible for anyone to track the identity and
original address of the user. Websites on the dark Web
(30:16):
only allow the tour browser to connect to their site
to increase the privacy and security of its users. The
dark web allows people to send emails, texts, and other
communications privately and anonymously. This is how many journalists speak
to whistleblowers, and how citizens in countries like China or
Iran communicate safely and avoid the censorship of their governments.
(30:38):
Using the dark Web is how the famed publisher Wikiliks
communicates privately with whistleblowers that give them leaked data. Like
the DNC emails during the twenty sixteen election. This may
lead many people to believe that the dark web is
(31:00):
a network set up by anarchists and outlaws. The Tor
browser was actually designed in the mid nineteen nineties by
the Navy to protect US intelligence communications. Online tour gave journalists,
their sources, dissidents, informants, activists, and others a way to
communicate with intelligence agents without fear of being discovered. The
silk Road website that Curtis had heard about on the
(31:22):
bitcoin forums lived on this dark web, so he decided
to check it out. What he found out was that
silk Road was an e commerce website on the dark web,
like eBay or Amazon, but the site emphasized anonymity and security.
To do this, it married tore and bitcoin. The only
way to visit silk Road was through the Tor browser,
(31:43):
and the only way to purchase products on the site
was with bitcoin, making the entire transaction between the seller, buyer,
and website anonymous. And it was also the first massive
trial for the use of bitcoin as Internet cash, and
it was quickly becoming a phenomenal success. In addition to
the marketplace, silk Road had community forums where people talked
(32:06):
and helped each other solve problems. Curtis was drawn to
these forums.
Speaker 13 (32:10):
They were talking about bitcoin, they were talking about it
was a community, and there was there was the merchant
side where the stuff was sold, and there was also
then there was the community threads and and that's what
is really interesting.
Speaker 1 (32:25):
Community boards like these can be found all across the
regular Internet. Places like Reddit, four chan, and the comment
sections of websites are just message boards where people gathered
to communicate with like minded folks. The boards on Silk
Road were just the dark Web version of those message boards.
Curtis became acclimated with the predominant philosophy behind the core users.
Speaker 13 (32:46):
Of the site, and then obviously I looked and I
saw there's these things that you know, libertarian view, where
you know, we should be able to put into our
own bodies what we want as long as we don't
harm the third person.
Speaker 1 (32:58):
Many on the Silk Road message board were anarcho capitalists,
a form of liberty marianism that has a radical view
on capitalism, free markets, and the role of the state.
They advocate for an elimination of the centralized state that
they view as an oppressor that always rules by force
and diminishes freedom. The silk Road administrator himself would post
(33:18):
on the message board that the site was founded on
libertarian principles. Silk Road users vehemently opposed the war on
drugs and felt they should in fact be legalized because,
in their view, besides the principle that people should be
able to put in their bodies whatever they want. Many
libertarians on these message boards believe that the war on
drugs was unwinnable. They thought legalizing drugs would reduce the
(33:40):
violence associated with the street trade. Because of the anonymous
nature of silk Road and the emergence of the Internet
cash bitcoin, silk Road became an extraordinary petri dish to
experiment with these libertarian free market ideas. People sold all
kinds of items on the site.
Speaker 3 (33:56):
Well, you get.
Speaker 13 (33:57):
Anything on that. You could buy shirts, you could buy computers,
you could buy thought and it was all they yet
because one of the rules is you couldn't lift something
on them that would harm a third person.
Speaker 1 (34:13):
But the items that were most prominent on the site,
the product that would eventually make silk Road and national headline,
were the drugs.
Speaker 13 (34:20):
I think it was seventy seven percent of the drugs
that were on the site was marijuana, and so the
grand majority was the substance of.
Speaker 3 (34:31):
Legal in I don't know how many states now.
Speaker 13 (34:34):
Even in Utah they just legalized the.
Speaker 1 (34:36):
Medical marijuana, But the other twenty three percent included MDMA
or ecstasy, cocaine, heroin, LSD, meth, mushrooms, and other illegal substances.
How much of these were actually being sold was unknown,
but they were no doubt listed for sale on the site.
Enthusiasts of silk Road believed that the portal itself was
helping reduce the violence associated with the procurement of these
(34:58):
substances on the streets because the people would be buying
them with or with out the Silk Road marketplace. Many
believed making the transaction anonymous and shipped rather than hand
it off in some back alley, eliminated the potential of
violence at the point of sale. Drugs have always been
illegally sold online, but the emergence of the dark Web
and bitcoin made silk Road the right idea at the
(35:21):
right time for this type of illegal marketplace. Curtis had
libertarian leanings and believes people should generally be able to
do what they want to do with their body, as
long as it doesn't hurt another person.
Speaker 13 (35:34):
I don't drink, but if I want to drink, I
want to be be able to drink. As long as
I don't get in the car and drive drunk and
kill somebody. Then what I do in my own is
by this.
Speaker 1 (35:45):
But he says drugs weren't the reason why he was
at the site. It was the community board and their
discussions of bitcoin.
Speaker 3 (35:51):
I didn't go there.
Speaker 14 (35:51):
Because the drug, but I'm not I want to drug
you or don't. I've ever taken an illegal street drug
in my life. But when I got there, I noticed
that people they weren't talking about that. They were cockying
more about cryptocurrency.
Speaker 1 (36:04):
But even with illegal drugs being sold, the site oddly
wasn't anything goes. They had their own community rules. The
site administrators didn't allow anything to be sold on the
site that harmed innocent people or was necessary to harm
innocent people to be brought to market. They prohibited counterfeit money,
stolen items, intentional fraud, em pirated software. Hit men were
(36:26):
also not allowed, and neither was child pornography. Anything else
that didn't meet these criteria was fair game. The site's
community believed silk Road helped people avoid the regulation of
the state and their eyes an oppressive entity that attempted
to control every aspect of people's lives. They thought silk
Road was a way to take back control from the government.
(36:48):
While on Silk Road, Curtis obviously saw the drugs for
sale and noticed people talking about them on the community board.
Speaker 13 (36:55):
I saw the people were buying substances that were very questionable,
and so I came.
Speaker 3 (37:02):
Up the idea. It was called a heart reduction.
Speaker 1 (37:05):
He thought starting a harm reduction form on the site
could help addicts and others expressing an interest in self harm.
Years earlier, Curtis earned his AMT license and worked as
a volunteer on an ambulance.
Speaker 13 (37:17):
And I wanted to help people that got you because
I have admit at the background, and to help them
if you know they wanted wanted to cut suicide or
they were wanting to think about doing drive, because I would,
I wouldn't steer them away from it.
Speaker 1 (37:41):
At the time in twenty eleven, the creator of silk
Road wasn't known, but there was a function to send
a message to the site administrator. So Curtis reached out
to the admin and brought up the idea of starting
a harm reduction.
Speaker 13 (37:53):
Form and I said, hey, I think this would be
a great idea, and he thought it was awesome. He thought,
oh yeah, we need definitely need that. So he and
then he said, oh, by the way, you're going to moderate.
So that's basically how why he got pled was still
through it. It was just it was basically to help
people with their issues.
Speaker 1 (38:11):
The Silk Road administrator set up Curtis as the moderator
of this forum, giving him more access to the site
than general visitors. But Curtis couldn't have known that by
taking on this role, his life was about to change forever.
Before it was all done, federal agents would raid his home,
torture him, fake his death, and framed him for a
(38:31):
crime that threatened to put him in prison for life.
And at the bottom of it all was a little
thing called Bitcoin.
Speaker 15 (38:38):
It's a certifiable one stop shop for illegal drugs that
represents the most brazen attempt the pedal drugs online that
we have ever seen. It's more brazen than anything else
by light years.
Speaker 1 (38:51):
Coming up in part two of Crypto and.
Speaker 13 (38:54):
That's the ninety went and stole all the money and
tried to blame me for it. It was twenty five
thousand bitcoins.
Speaker 3 (39:00):
The day that the word hundreds of millions of dollars.
Speaker 10 (39:03):
Road was a marginal company. Why do they target it?
Because Wall Street wanted to shoy Bitcoin before it could
get big enough to compete for them, because a lot
of people don't want to have to deal with central bankers.
Speaker 6 (39:13):
And I think it's political, and I think it's also
about the bitcoin, and in fact that NSA was urgently
targeting bitcoin users a few months before the silk Robe
was taken down and Ross was arrested.
Speaker 11 (39:26):
The Chinese now use bitcoin to get money in and
out of the country, so they can't otherwise get in
and out. The same thing with the Koreans. And the
real question becomes is just like armies. You know it's
illegal to have a private army in the United States,
should it be I legal to.
Speaker 3 (39:40):
Have private money?
Speaker 7 (39:42):
Red Pilled America is an iHeartRadio original podcast. It's owned
and produced by Patrick Carrelci and me Adrianna Cortez of
Informed Ventures. Now you can get ad free access to
our entire archive of episodes by becoming a backstage subscriber.
To subscribe, visit redpilled america dot com and click join
in the top menu. That's red pilled America dot com
(40:03):
and click join in the top menu. Thanks for listening. M.
Hosts And Creators
Adryana Cortez
Patrick Courrielche
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