The Rise and Rise of Bitcoin Page #7

as physical carriers

for bitcoins.

But they do something

very important.

They give bitcoin a face.

Come on in.

Sorry, the kids

are sleeping,

so I'm just being quiet

so we don't... you know.

DANIEL:

Each coin has its own bitcoin address.

And the private key

required to spend it

is hidden

underneath the hologram.

This is where you make

the physical bitcoin.

Yeah. It's a random

smattering of things,

but I'm pretty careful

about the way I manage...

you know, the...

basically,

this is the credentials.

This is the hologram

and the private keys.

I'm pretty careful about those

and don't keep them here.

I normally do them

on this mirror

'cause that helps me get

the fronts and backs right.

There's so many things that

cryptography can do for us,

that if the world

just knew,

so many social problems

could be solved.

Cryptography can bring

fairness to elections.

It's too difficult

for people to understand

and someone needs

to bridge the gap.

DANIEL:
Right now we're using

bitcoin to send money.

But many believe it will

revolutionize much more.

The technology

behind bitcoin

can be used to build

decentralized systems

with rules

that can't be cheated.

Now see, this is

my wife and my space.

- This is, you know...

- awesome.

It is what it is.

The more time goes by,

the more legitimate

bitcoin gets

and the more proud I am

to be associated with it.

Now what does

your wife do?

She does crafts.

She's a lot like me.

We just sit around

and make things all day.

It's just our obsession.

No, I'm not a drug dealer.

No, I'm not a criminal.

No, I'm not a terrorist.

I believe

in the rule of law.

I believe in structure

that builds society.

I believe in families.

I believe

in corporations.

I believe in all

the essential elements

that a civilized society

with law and order

need to be able

to function.

Focal length matters.

( WHIRRING )

Cryptography is the basis

for us being able to implement

the values we say we believe in.

CALDWELL:

This idea will never die,

the technology that bitcoin

brought to the forefront.

The genie is

out of the bottle.

DANIEL:
Since the crash,

the bitcoin price

has been hovering

around $100.

Bitcoins seem to have

weathered the storm,

but there's still much controversy

surrounding the currency.

The same cryptography that

insures a user's privacy

also allows it

to be used anonymously.

STEVE:

My father decided to retire

and he had an old

failing print shop.

I basically took it over

and I converted it

into an Internet place.

We're the only place

in L.A.

That supports

bitcoin right now.

This is

my linux system here.

It's a system that

also mines for bitcoins.

Makes about a dollar a day.

I just do it for fun.

I was really really

into the Internet,

literally in 1990,

1991, 1992,

and I had

the hardest time describing

what the Internet was

to people.

I would tell people, "well,

it's like this network of computers.

And the network

of computers

can talk with other

networks of computers

and then you could

exchange information."

And people would have

no idea what it was.

( BEEPS ) - When people

ask me what bitcoin is

I have the hardest time

describing what it is.

And I'd surmise it as,

"it's basically money.

It's basically

an anonymous PayPal.

It's one of those things

that you have to use

before you understand.

Politically, I'm not

a very big fan

of either the banks

or federal reserve,

and bitcoin allows me

to get around that.

One of the programs we support

is a protocol called "Tor."

And basically what Tor does is

it allows you to communicate

to a website anonymously.

Tor is a program that allows

you to get on the silk road.

And this is silk road.

Basically, any drug

you want is available.

There's a lot of weed.

There's a lot of cocaine.

There's a lot of ecstasy.

But there's also

unusual drugs,

like if you want some sort

of anabolic steroid,

you can type "steroid."

You'll get

all the different types

of steroids

that are available.

Silk road itself is

not selling the drugs.

This is basically

a matchmaker

between buyer and seller.

Both the buyer and seller

don't know each other.

Both the buyer

and seller are anonymous.

It goes

on this web of trust.

If you want to, let's say,

buy this testosterone,

you'd click on this.

He has

99.3 positive feedback

from more

than 300 transactions.

So even though the contracts

aren't enforceable by law,

the reputation system

makes it so that

the system works

pretty well.

Oh, there's a fireworks section now.

I didn't know that.

Florida I.D.,

1.88 bitcoins,

which is around $150,

something like that.

A forged

auto insurance card,

forged passport.

There is over

9,000 entries for drugs.

That's a lot.

I would say there's around

maybe five customers

that know about it

and use it.

It's a very small percentage

of the people that come in.

But the people

who do know about it,

specifically

come here to use it.

( ROCK MUSIC PLAYING )

What the customers do

with the computers

is pretty much

their business.

Another day in the office.

You gonna do

drug dealing of any sort,

silk road is

the place to go.

How many people are

selling cannabis right now?

It looks like 2,011 people

are selling cannabis.

They call me

Mr. bitcoin.

I probably been

dealing drugs

since I was like 17.

Right now I'm 26.

I think of it

as a global thing

when I'm on the computer.

I'm doing business

with the world.

Let's see,

they have blue dream,

sour diesel,

pineapple thai,

purple kush, girl scout cookies.

Purple pays.

When I first

heard about it,

I was laughing about it.

It took me a week

to just even think

about this for real.

"I can really make money

off the Internet?

Selling this type of stuff on the Internet?

You sure about that?"

This something I probably

may buy right here.

They have looks like

some good kush.

And some of these things

only take a day to get here

with no harassment

from nobody

instead of just being

on the streets.

Once you get the hang of it,

it's actually kinda fun

just looking through

different things.

"Mr. bitcoin."

I'm running with it.

I like the name.

You know what I mean?

I'm not gonna lie.

I get Booty off this.

I kinda like talking

about this stuff with girls.

Girls like that sh*t hot.

( LAUGHS )

"Oh, you're street, and you got

a little nerd knowledge?

This is great."

I have a lot of bitcoins

saved up already.

My business is doing good.

It's a fun way of doing

hustling these days.

The future brung

a different way to hustle

and I like it.

DANIEL:

With so many people using bitcoin

in so many different ways,

it's becoming apparent

that it can't be ignored.

- Let me see your driver's license.

- Oh sure.

This stays at the desk

until you leave the building.

DANIEL:

Today I'm visiting fincen,

a bureau of the U.S.

department of the treasury.

Despite having released

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