We spoke with John McAfee, founder of McAfee Security (which sold to Intel for 7.68Bn in 2011), who is currently chief analyst and developer at MGT Capital Investments, a Bitcoin mining operation based out of the United States, to get a sense of how governments in the Middle East and elsewhere are responding to emerging blockchain technologies.
According to McAfee, there are three broad reasons why crypto-currency will enjoy a successful future.
1. Legislating Won't Work
“This time next year there will be no government anywhere in the world that can ever shut down and exchange because with BitIndia we have now a wallet that has its own exchange in it. There is no central exchange, the function of the exchange has been distributed like the function of the banks has already been distributed.”
According to McAfee, shutting down the blockchain is a bit like shutting down the internet, or any other networked system. This is why attempts to legislate against crypto-currencies will be very difficult.
2. Shutting Down BlockChain is Not Going To Happen
Next, governments may try to restrict or shut down blockchain using technology.
“Ok, so laws don’t work, let’s see if we can physically shut it down. There is no way that we can shutdown a distributed system beyond shutting down the internet itself. What are you going to do if you are in America and the internet is shut down, and the cables are cut?”
McAfee summarizes the situation like this. “So it can’t be shut down with legislation and it can’t be shut down via technology and it may take them years to figure this out.”
3. Governments Will Figure Out How to Use BlockChain Technology
Instead of figuring out how to control blockchain based technologies, governments are going to figure out how they can use it.
“The smart countries are going to have people who understand the technology, and they will say 'you can’t shut it down, there is nothing you can ever do, get used to it. So why don’t you start today figuring out how to collect tax. So you’re going to have to charge people for the use they place on the roads, or charge them a large amount of money to visit a national park.'”
The taxation issue aside. The key point here is that individual entrepreneurs and policy makers can help shape whether governments take a combative or enabling approach towards the technology.
A Promising Future?
The Middle East is often used to thinking of itself as different to every other part of the world. McAfee is not so sure.
“As for activists, every new technology that comes out is going to be grabbed by everybody with common sense and forward thinking to be applied to their own needs. If for example when we didn’t have the printing press, activists in the Middle East and America would be using the printing press to print flyers to post on the streets. Now we’ve got the internet, we’ve got blogs, we’ve got encryption of all of these facilities. They will all be used by activists and nonactivists alike.”
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From digital surveillance, to the activism of the Arab Spring, to the startup parks popping-up in many Arab capitals, it’s clear that different groups utilize technology for their own reasons. The best application of a technology, is usually the one that wins.
“Technology is always, always, more advantageous to the intelligent because they will understand it first. They will understand it more thoroughly, and they will apply it more efficiently.”
For the alt-currency community in the Middle East, McAfee has the following advice. “Stick with it. It will not matter how smart your government is. They will still not be able to control crypto-currencies. If they are smart they will realize that and won’t even attempt it. If they do attempt it, they will not succeed. So stick with it.
Interview by John Lillywhite
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