Hi, this is Charles Hoskinson broadcasting live from warm, sunny Las Vegas. I wanted to make a quick video because a momentous, amazing thing has happened for our industry and for a very particular person. As many of you know, I’ve been in the cryptocurrency industry for a very long time. When I was in the industry in the very early days, there was an anomaly called The Silk Road that was started. When it first began, we didn’t know who was running it, and then it became clear that the person running it was Ross Ulbricht. Eventually, the government prosecuted him and gave him an incredibly unfair, onerous sentence of multiple life sentences plus 40 years. Unfortunately, this meant that a very young man who made a mistake was sentenced to spend the rest of his natural life behind bars.
Many presidents completely ignored this vast injustice, and over the past decade, we as a society have come to recognize that it was an egregious mistake. Today, I am pleased to report that Donald Trump has signed a full, unconditional pardon for Ross. So, Ross is going home now. Eight years ago, I wrote an article about this on Steemit, and I wanted to read this off to you guys. I actually mentioned something that I’ve never mentioned before, so let me go ahead and share my screen. You may remember Steemit from back in the day. Here we go. I was a bit of a pompous writer back then, but this was originally written in May of 2015.
From time to time, I enjoy investing in and considering politics in the state of affairs here in the United States. Our country is the first hyperpower, forcing all other nations to consider us in whatever policy happens to be the day’s topic. This reality is divorced from ethical or moral metrics, and the War on Drugs is no different. For whatever reason—religious, practical, dystopian, etc.—policymakers in the United States have continuously decided to label a behavior of substance as dangerous to the social fabric of our society. Prohibition is the standard example, and its spectacular failure is somehow forgotten. We saw and acknowledged the rise of the modern Mafia. We saw the decentralized nature of resistance through bootleggers, some say whose kid became president, and the FBI to stop the bootleggers, empowering J. Edgar Hoover to terrorize two generations of Americans via legal spying and blackmail, including Martin Luther King. Yet, why have no lessons been learned?
The War on Drugs is a leviathan that has imprisoned millions of Americans, vastly disproportionate for minorities, formed massive bureaucracies such as the DEA and their state equivalents, and like Hoover’s FBI, solely transformed society to both militarize the police and make their actions somehow acceptable. In this process, we have asked what the goal exactly is. Why are we as a country destroying families, imprisoning millions, and treating addicts as hardened criminals? Why have we created an industry that robs us of our constitutional rights and turns our police force into something resembling a state?
I was referring to this with all the abuses of the War on Drugs, which are numerous and well-documented. I honestly don’t have a good answer. There is perhaps a historical context that could be explored to synthetically explain why we are somehow comfortable as a nation using a Plato-like ideal of social fabric to justify incarcerating millions for nonviolent crimes. Yet, this leaves a putrid taste in my mouth. The United States drug policy is, simply put, immoral to the core. If drug use results in damage to one’s relationships, we should hold people accountable for their actions. But instead, we see that heroin is somehow more damaging than alcohol, and marijuana is a gateway to personal destruction—except for when our president smokes it, I guess. Colorado is doomed then.
Now enter Ross Ulbricht, the Dread Pirate Roberts. He isn’t a very nice person. I’ll get to that comment in a second because I wrote this eight years ago. No one running a drug cartel really is a nice person, but he is an Aztec cartel kingpin proudly displaying the heads of his enemies. He is a programmer who saw an opportunity to use emerging technology to enrich himself without regard to the current egregious laws. He believed that he could stay hidden thanks to the nature of Tor and Bitcoin. He also believed that a decentralized marketplace could reduce the violence associated with the drug trade, which is fair considering that violence comes from prohibition, not the other way around. The fruits of his labor were a modest marketplace that was the safest and lowest-violence drug exchange in the world. It also allowed suppliers to directly sell to consumers, cutting out the middlemen, who usually end up being pure evil.
Compared to the Golden Triangle, a relatively small amount of funds changed hands, and consumers got their substances. The vast majority didn’t go crazy and grab chainsaws for some Tony Montana action. The vast majority didn’t destroy their families and social networks. The vast majority are still living their lives amongst us, going to work, church, or vacation. Somehow, the social fabric the government must protect hasn’t been torn. Now, Ross gets to spend the rest of his life living as a living symbol of the War on Drugs. He has effectively become its Nelson Mandela. The Silk Road won’t go away. Those who are knowledgeable about cryptography and the nature of the internet will cite technology like OpenBazaar and other systems such as BitTorrent as the moment of the online drug trade. Ross’s imprisonment will send no message contrary to what the prosecutor suggests; it just increases the stakes for anonymity and the amount of potential profit from the trade. The countermeasures will inevitably be a war on cryptography—I should trademark that one—and internet anonymity. To protect the social fabric, the United States must rob us of our privacy and autonomy. We must accept that all packets need to be inspected. Secrets are illegal, and no doubt massive government budgets must be increased. Think of your children.
I’m really done with this madness. We supposedly have a republic and have the right to change things. At this moment, I’ll divide the Bitcoin space into two groups: those who complain about the injustice of Ross’s sentence and those that do something about it. I’m going to do something about it. My company is going to build some great tools to preserve personal privacy—something we have a constitutional right to—and make sure they are open source and well distributed. I’m also going to ask everyone in this space to be in the second bucket: do something about this injustice. Think about the software you could write, organize meetups, and spread the word. We didn’t like our money or the banks, so we made new money. Is it inconceivable that we can make a new society with a social fabric that’s actually worth protecting?
I was pretty angry when I wrote that eight years ago, and it’s pretty hopeless and cynical. Since that time, I’ve actually had a chance to meet Ross’s mom, Lynn. She’s a wonderful person. Ross’s family are great people and strong advocates for him. They pushed for his pardon for over eight years, and I never believed that a U.S. president would care. I never believed that would actually happen—that he’d actually get a pardon. I thought he was going to be a political prisoner for decades to come. It’s an incredible moment that I was wrong, not only about the pardon but also about him as a person. Since the time I wrote that, I’ve come to the conclusion that while he was misguided, I do believe he’s a good person. I believe that deep down inside, he wants to be a good person and now has a chance to prove himself as he reintegrates into society.
That was also the moment that I decided to start working on Midnight. I started thinking about privacy at a very deep level and asking questions about how the freedom of association, commerce, and expression should work. At the time, I had no idea how all these SNARKs worked or any of these other things. I knew about them as concepts, and I had a rough understanding of what the limits were. That began a six-year journey that we’ve all been on at Input Output to build the technology behind Midnight that creates a concept of rational privacy—something that’s a bit of a middle ground and a little different between the total anonymity of Zcash and Monero, but very different from the total transparency of the blockchain space. It’s been an amazing journey, and I want to thank Ross for inspiring the beginnings of that journey and getting me really interested in this topic.
I believe that systems have to exist in a state of "can’t be evil" instead of "don’t be evil" because humans are flawed. No matter how good they are, how nice they are, they will let you down at some point because incentives change, personalities change, people die, people get replaced, and institutions may forget their purpose and become corrupted over time. The reason why Ross’s sentence was so harsh was that people in the U.S. government, like Chuck Schumer and others, decided to make it harsh to prove a point. He was the victim of the heavy hand of politics, not justice, and it’s great to see that that’s been undone. It’s the beginning, not the end, of a new tale, a new story. We as an industry can’t forget where we came from, and we can’t forget why we exist.
Over the coming ten years, cryptocurrency is going to enter the mainstream. When it enters the mainstream, we have to ask ourselves: what’s the point of it? Why are we here? What are we doing? Where are we going? If the point is just simply to build a slightly better Wall Street and make tokens go up, then we have stepped away from the most significant economic, political, and social technology in human history. For me, it has always been the same: the point of this industry is to liberate us and take us to a state where systems don’t fail by design and every single person is held equal under the law and accountable. We simply don’t live in that world right now, but we could. So let’s never forget about that, and let’s never forget about where we can go from here.
I am incredibly glad that every now and then the good guys win, and every now and then injustices are corrected. It gives me hope that the future will be brighter. We have a lot to do, and we’ve all grown quite a bit—some for better and some for worse. For myself, it’s been better. I was a lot more idealistic back then and a little less jaded and a little less tired than I am now. On the other hand, I have a lot more wisdom, a lot more resources and capability, and a much larger following—a bigger pulpit to speak from. But I’ve never forgotten the cause, and I’ve never forgotten why I’m here. I’ve never forgotten the people that got us where we are, for better or worse. Ross is one of the biggest and most significant parts of the history of the cryptocurrency industry, and if you start taking these Jenga bricks out of the tower, not many have to be pulled before it falls.
We, who are beneficiaries of this industry that has been so good to us, can’t forget where we came from and to venerate all the things—good and bad—that have been done and understand them for what they are. So allow me to be one of the first, having been around as long as I have, to welcome Ross back. Welcome home. You always have a place here, you always have a job here, and you will always be in our hearts. We as an industry have to remember the lesson of Ross: unrestrained power and political processes that are not accountable to us will eventually lash out and cause harm to us.
It’s very simple. We have to take a step back and realize that the systems must be retuned into a state where they can’t be evil instead of "don’t be evil." We can’t trust people; we have to trust algorithms for certain things. We have to ask how we rebuild our economic, political, and social systems so they’re a lot more fair. I will always be an opponent of the War on Drugs. I always will be—not endorsing drugs and saying they’re great for you and you should take them. But let’s be clear here: we live in a society where it’s ridiculously easy to go to a physician and get a prescription drug that, in many cases, if it’s overprescribed or carelessly prescribed, can cause profound harm, which is where the majority of the opioid epidemic came from that has killed so many and harmed so many—not to mention so many other substances.
But then somehow, some other way, plant medicine is illegal. Somehow, some other way, psychedelics are illegal, even though they are profoundly beneficial to people with PTSD and depression, among other things. This has enabled cartels to gain enormous amounts of power by taking advantage of the market anomalies created. As I wrote eight years ago, this is on the back of us living through prohibition, which led to the rise of the modern Mafia. We just simply don’t learn lessons because the incentives are misaligned. These are moments for us to take a step back and ask ourselves why. Why do we keep doing the same thing again and again? It’s because the economic, political, and social systems need an update.
We also need to treat each other with a bit more empathy and compassion and a bit more understanding when people make mistakes. There are times we have to punish them, but you don’t sentence people who make such mistakes for the rest of their lives with no hope. It took the election of a very unorthodox and unusual president, Donald Trump, to undo that profound damage. We got lucky on this one. No normal U.S. president would have the courage to do what was done today, and I’m very glad that promises were made and promises were kept. I remember watching when Trump spoke at Bitcoin 2015, and he said, “I’m going to pardon him.” I took him at his word, and he honored that commitment. That’s an incredible thing, and I’m happy about that.
But that is the exception to the rule; it’s not the rule. The system will not naturally exist this way; it’s going to regress back to the mean unless we change the system. So the very next step is we have to reevaluate these things that we do and our relationship with the government and how they treat us and how we treat each other. This time around, we have one of the best tools ever: blockchain technology. It’s there to keep us all honest, even when we don’t want to be honest. It’s there to keep us all equal, even when we don’t have incentives to be equal. That’s the real lesson here.
We also have to protect and preserve our basic human rights, and some of our rights to privacy are fundamental and absolute. Because the minute we do violate them, they will be exploited and used against us when it’s politically convenient. You should never forget that. So welcome home, Ross. It was pretty cool that I got to dig up an article from eight years ago. It’s kind of fun to read things that you wrote nearly a decade ago and say, “Man, do I still think that?” or “Is that still there?” It’s nice to evolve a little bit.
To Ross’s mom, Lynn, I’m glad we got it done, and I’m glad that you get your son back. It was real tough seeing you there, I think it was at the Litecoin Foundation Summit in Vegas, seven or eight years ago. I saw a grieving mother who just wanted her son to come home, and it’s incredible that she gets to have that moment, and we as an industry get to have that moment. Let’s not forget the people who got us where we are today, and let’s not forget the good things. So let’s all enjoy this one. Thanks, everybody.
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