Are Bitcoins and Unusual Hats the Future of Currency? | Idea Channel | PBS Digital Studios
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Are Bitcoins and Unusual Hats the Future of Currency? | Idea Channel | PBS Digital Studios


Here’s an idea. Bitcoins and unusual hats
are changing currency. [THEME MUSIC] In the way the US has the
buck, Brazil has the conto, and Canada has the loonie,
the internet has the bitcoin. The bitcoin is a decentralized
digital peer-to-peer cryptocurrency. It doesn’t rely on
any physical note. And it isn’t
regulated, controlled, or anythinged, really,
by a central issuing authority, like the Federal
Reserve or Uncle Moneybags. But because no one
is in charge, that doesn’t mean you can
just make infinite money. Free money! In order for a currency to
have value, it has to be scarce. You can only print, mine,
or mint a certain amount. Bitcoins are generated
by networked computers solving complex
cryptographic puzzles. It’s sort of like you’re
asking your computer to solve a Rubik’s Cube
with a side for every color of the visual spectrum. This hard work makes bitcoins
and maintains not only scarcity, but market stability. I know, it’s pretty cray, and a
little hard to explain quickly. So if you want to
know more, we’ll put some links in the
place where links go. Now, state currencies,
even Loonies, can be exchanged for
bitcoins and back again, making it fully convertible. So you can spend your bitcoins
on all kinds of stuff. I mean, mostly internet
stuff, like hosting and backup services, but also
candy and cupcakes. Who doesn’t love cupcakes? And you can do this
even though they’re just ones and zeroes
generated by a computer on a network somewhere. Bitcoins are traded
by people who have all agreed that they have a value. And so– ta-dah! They do. Which actually makes
them a lot like hats. Well, sort of. Bear with me for a second. About two years ago,
an analyst estimated that Valve’s online first-person
shooter “Team Fortress 2” was worth about $22 million, not
in revenue, not in terms of IP, but in hats. Digital tradable hats. You see, in 2009, Valve
introduced one hat for each of the “TF2” player classes. You know, spruce up your
character, give him some style. But since then, they’ve
introduced over 250 more hat types, ranging from pretty
mundane hat-type hats to some really weird–
and more importantly, rare– digital headgear. The rarest of the rare head
gear is called as unusual, and as is normally the case
with rare and unusual things, people want them. A lot. And so where do they get them? Good question. They get them from crates. Crates can only be
opened if you have a key, a key which you have to–
ready?– pay real money for. So about 1% of the time you
use your it-costs-money key to open your crate, you
will get an unusual hat. Now, if it wasn’t already
interesting and complicated, here’s where it gets really
interesting and complicated. Hey, hey, hey, hey! What is going on here? Players can trade hats, and all
other items, for that matter. But we’re talking about
rare and valuable hats which no one’s going to
want to just give away. It’s gonna cost you. Trades are paid for with PayPal
and sometimes even Bitcoin, but many trades are paid for
with an in-game material called refined metal. Remember those crates? The other 99% of
the time that there isn’t an unusual hat in there,
you get weapons, or a sandwich, or socks. This stuff can be
scrapped and combined to create refined metal. But remember, you paid
money to open your crate. This gives refined
metal a value. And because it’s tradable
between players in game, it becomes a peer-to-peer
digital currency for buying hats. $22 million worth of hats. Yeah, I found this
backstage, a oversized hat. Funny. The really great
part, though, is that the source of
that value, the crates, are dropped at a rate
determined by the amount of time a player is in game. Sounds a little
familiar, doesn’t it? Add to this the fact that
items, much like bitcoins, can be tracked and timestamped,
and that while they are generated by
a central network, they are effectively traded
freely between players, and we’ve maybe made the case
for a second hugely successful alternate digital currency. Now this whole thing
really indicates some mind-blowing
stuff about money. Let’s not mince words. Bitcoins and refined
metal, and, I’m sorry, hats, no matter how
unusual, are worthless. Don’t get me wrong. The dollar and the
euro and the yen might also be worthless, in that
they have no intrinsic value, like gold. But they are the fuel
for global exchanges and markets and economies with
widely traded and accepted physical manifestations. No one will refuse a
dollar because it’s “not worth anything.” But really, weirdly, it’s not. This is just some
cloth with ink on it. And debit cards and credit cards
are just further abstractions. The gold standard was
abandoned long ago, replaced by an artificial
scarcity maintained by some very smart people
in some very tall buildings somewhere important. But we have this weird ingrained
cultural make-believe time where we all pretend that
this thing has some value. Which it does, but it’s because
we pretend, not because it has any intrinsic value. Dollars are one
kind of worthless. Bitcoins and refined metal are
a different kind of worthless. They’re like baseball
cards, or the stuff that they find on
“Storage Wars.” They can only be
converted into lunch money after finding someone who
agrees, yes, the Blizzardy Stately Steel Toe is worth $30. But that doesn’t change
the fact that two years ago, the equivalent
of 60% of Tuvalu’s GDP was wrapped up in America’s
number one war-themed hat simulator, and that Bitcoin
is the world’s most popular alternative currency, worth over
$200 million US and growing. But you’re right. No one is going to be buying
dinner or a car with hats, or even bitcoins, for that
matter, any time soon. But these currencies,
especially bitcoins, prove something,
both about the growth of Internet Culture
with a capital C. I mean, if Tuvalu gets a
currency, why not the internet? And also about our
willingness to take matters into our own hands. The DIY mentality has
gone from desks and cars to computers, biology,
chemistry, and now currency. If our currency and
our credit system is already ones and zeroes, but
unreliable and confusing ones and zeroes after years
of tinkering and turmoil, why not design a new currency
with all of the benefits but none of the baggage? And yeah, maybe this is just
a flash-in-the-pan reaction to the global economic sad
party and a growing distrust of government bodies to
maintain a stable currency. But even if it is,
it seems to work. And as Daniel Webster said,
“A disorganized currency is one of the greatest
political evils.” Which means maybe this sound– [CREAKING HINGES] Is the sound of
orderly progress. What do you guys think? Do alternative currencies
have real world worth? Or should they just
stay in video games? Let us know in the comments. And if you subscribe, I
might send you a Sandvich. More good news, everyone. Comments. Let’s see what you had
to say about “Futurama” and transhumanism. So first and foremost,
SuperheroEnthusiast, That One Guy Named X, and a
bunch of other people pointed out that
throughout the episode, we sort of conflated
abolitionism and transhumanism, and we should have made
it a lot clearer that not all transhumanists
are abolitionists, and not all abolitionists
are transhumanists, and that like any
label or belief system, there are people within
those groups that differ from each other. So thank you for correcting us. Thanks for letting us know. To hejcoze, no joke, I have
been saving bottle caps for the nuclear post-apocalypse. So I think we’re
on the same page. SonofSetholtae Dalton Loney,
and a couple other people point out that you can’t really
discount parts of transhumanism for messing with human
nature, because human nature is such a weird fluid
concept anyways, and that if we are evolving,
the thing that we turn into might be so different
that human nature isn’t even really a thing anymore. Ethan Quinn makes the
really solid point that not all ambition is
towards the goal of being happy, and that the netural
planet itself, even as neutral as they are,
still has goals and ambitions. Kyle Munkittrick points out that
“Futurama” and transhumanism are not mutually exclusive, and
that “Futurama” actually paints a picture that most
transhumanists would be totally on-board with. In response to WCPointy60’s
response to jayne deis, this, I think, is a
really interesting thing. Because like if I have
a headache, I’m in pain. And then if I don’t
have a headache anymore, I’m not experiencing pleasure. I’m just in not-pain. So pain and pleasure
or pain and joy are not necessarily
opposites, in that sense. But the way we think
about pain and pleasure, our emotional experience of
it is usually we want pleasure and we do not want pain,
and so in some sense, they are opposites
of one another. And maybe what
we’re running into is a kind of cognitive
difficulty related to not being able to describe
those feelings appropriately. Elaine Scarry
actually wrote a book about this called
“The Body in Pain.” It’s about this
whole phenomenon, and it’s really good. You should check it out. To ILIKECEREALX, I have not
yet evolved past the point of having human emotions. So yes, it most certainly did. [THEME MUSIC]

100 Comments

  • Gurobear

    Gold is just as made up value as a dollar, we give everything value. And gold is just as worthless as bit coins, it just a matter of what we pretend. 

  • Knarta

    How did it take you 6min to come up with this? You could have wrap this up in 2min without the complicated talk, and explore the topic further

  • Karl Vega

    Sell $500 worth backpack of TF2 Hats rewarded on playing a game. Use credit on Steam Sale for more games. Steam rewards more games for playing and enjoying games. If only life.

  • nimtra

    please no, this destroys the whole purpose of tf2, it's a shooter game. its a GAME, not a money maker. i mean like, yeah it kinda already is, but honestly you shouldn't really make tf2 a complete money maker, i've seen people with 10 unusuals, yet suck at the game. i do not want this to happen but, ya know it's the internet. can't do anything about it… :/

  • Crevan Embrust

    TF2 creator Valve = No bosses + Fair, peer reviewed pay system. Every individual employee has as much power as any other one. Gabe is a founder and a driving force in the company, but with no ability to buy stock in Valve he's as much in control as anyone else.

  • 25KnightOwl

    I did find it really interesting recently to see artists on Tumblr offering TF2 fanart commissions in exchange for either a fixed payment through paypal, or a set number of crate keys for the game 🙂

  • chrisgosselin92

    In case anyone is curious, Bitcoin is now worth 8 billion dollars, which is a massive increase compared to when this was initially published.

  • Carzeyday

    Well considering how code works. Yes and no. It depends on many things. In games It is supply/demand/ and rarity.

    Rarity is sometimes not needed.

    But, the Demand is always.

    It is like Card game eco. They are based on how much on how many people are willing to throw money at something.

    For example. If a character everyone really likes or class gets a item everyone wants. It sky rockets.

    If a class or character few or less likes gets a item. It will be cheaper. 

    If a character or class is played by a streamer or pro. Price for items go up for that time.

    If they rag on a character or class. Price goes down.

    Basically, It is like stock market. Where people are told but do not really know.

  • Unbound

    What about somebody like Joker in the Dark Knight? When he burned money? Someone who doesn't value anything or just changes values to bring about destruction – some men who just want to see the world burn.

  • VentionMGTOW

    Well, you can get a lot more lunch money for a bitcoin than you could back when you made this video. Back in Febuary of 2013 they were worth about 16 dollars. Now they're 600, and the adoption rate is increasing dramatically and the rate of the increase is increasing. Overstock, dish network, expedia, and Dell all take them now (among many many others).

  • Shotgun9009

    TF2 is the best way to acquire games on steam think about it u find items u buy keys with items u use keys to trade for games or sell them for money and buy the game on steam and at the end you have spent absolutely none of ur own money sure it might take some time but its free

  • François Joly

    This doesnt make much economics sense…the creation of money isnt some simple thing you can let computer regulate…..(unless you are a monetarist and therefore believe monetary regulation is a fraud)…money is not neutral and if you dont believe me just looks how wall street freaks out when the FED just starts thinking about increasing interest rates (which would reduce the amount of currency generated in the US).

  • Eva A

    Since you mentioned that no-one can buy dinner with bitcoins, one of my favourite cafe's actually accepts them now. Why, I don't know (since i doubt pretty much anyone is using them to buy food), but its an option.

  • Cule Chick

    Just for the record, there ARE places where you CAN buy dinner with bitcoins. Not cars though…. still waiting on that one.

  • Jeff Rosenbury

    A dollar's value is not nothing. Most Americans have debt denominated in dollars. We need them to pay mortgages and the like. So long as there is more debt than there are dollars to pay the debt, the dollar have real value beyond any fictional agreed upon value like Bit Coin. 

    Of course this value is generated by historical decisions (to take on debt) and in that respect it is "fictional". But now that those decisions have been made, the value becomes real. 

  • marko vrtunic

    Oh hello! Have you heard the talk about – Brians Bitcoin Big Bang (do a Google search)? In case you are intent on making money with Bitcoin, I have heard some great things about it and my GF got excellent rewards with it. 

  • Dan Fielding

    With the way he's saying it, one Rec (Reclaimed metal) is equal to one weapon. This is NOT the case. there are three main types of TF2 currency:
    * Scrap (one scrapped weapon)
    * Rec/Reclaimed metal (3 scraps put together, or 3 scrapped weapons)
    * Ref/Refined metal (3 Recs put together, or 9 weapons)
    Depending on how long you play for, weapons (and hats if you're not Free-to-play) by themselves (with no need to uncrate them, since they're already ready to use) will drop as well, so you don't need to use real money on them. In fact, more weapons drop than crates in my experience.

  • Creative Boy

    Oh hey! Have you heard the talk about – Brians Bitcoin Big Bang (Have a quick look on google cant remember the place now)? Should you be serious about making money with Bitcoin, I have heard some pretty good things about it and my auntie got cool benefits with it.

  • Nighthawk

    the difference being, a bitcoin can be bought with money,…. which stands against the point of the bitcoin which is to replace the monetary system.
    hats and weapons are self-generating, over the course of regular game play….. they're not 'owned' by the system generating them.

  • abinaderus

    Bitcoin is just a much higher-tech currency that was created to forcibly move the world faster (with warp speed) toward a computerized one world currency, which will also be controlled the same way (with RFID), in an absolute foolproof way in its final form.

    That is why bitcoin was created anonymously. No individual created bitcoin, rest assured on that. It is amazing that in people's greed, nobody (like with 9-11) seems to know or care what the truth is concerning the origin of the issue. They just jumped in headfirst, like rats, because there were big profits to make with the invention of bitcoin.

    Tools for moving currencies – like credit/debit cards, wire transfers, PayPal, will all give way to RFID. Bitcoin represents a much closer step toward computer-controlled world currency, and RFID the same as the means to control the flow/stock of the one-world currency.

    RFID is the final tool for the financial future, just as a single, one-world currency is the final currency. They are now RFID chipping 100s of people in Sweden for medical reasons, they have chipped some of the US military, but eventually RFID will include all your basic info, including a unique ID, your financial info, your education and work history, and so on, at which time RFID will become the final "debit card," implanted in your right hand or forehead. A few years ago, even the US Congress quietly passed a law making taking the RFID chip "voluntary," once it comes into being! By then, of course, it will be a choice of taking the RFID chip, or else no buying or selling of any kind.

    Everything is in place via the five-story-tall EC "Big Brother" supercomputer in Brussels to do this right now (every person alive is in their database right now!), as is the banking system now capable of implementing both RFID and a world currency. All that is missing is the man who puts it all together.

    And what will bring in RFID?

    The US has been the oil reserve currency, ever since Kissinger made the deal with the Saudis in 1970. Meaning, all purchases in oil anywhere are made in US dollars. The US is also the world reserve currency. Both of these create false demand for the dollar, but the world is sick of our $125 trillion in unfunded liabilities, and our $17 trillion in national debt, and US imperialism, and today as a result (as you know) the dollar is being bypassed more and more in world trade. These black markets will soon become white markets, as world approval grows.

    Last year, China bought 90% of the world output of gold, and now has over half the gold needed to begin minting a gold-backed yuan. A gold-backed yuan would destroy the dollar overnight, because once major nations no longer accept the dollar as world oil/reserve currency, the US balance sheet will INSTANTLY dictate the value of our worthless fiat currency.

    Add to that, China is not interested in the UN's proposed world "basket" of currencies becoming the international standard (dollar, ruble, yuan, euro), because China has the only truly growing economy, the only significant surpluses, and also the goal of world domination. If the dollar crashed, the US would have no choice but to comply to China's every demand.

    As countries (like Syria, North Korea, Russia, China) bypass/eliminate the dollar in their trade, the need for a universally-accepted one-world currency escalates, and RFID is the one foolproof tool to support such an international currency. If you want to know for sure that this is going to happen, and who will implement RFID and the world currency, open your bible and read Revelation, chapter 13, especially verses 16-18. As things develop, people will finally realize that the bible is exact, and easy to understand

    Everyone, read John 3:16. Accept Jesus as your savior. It will change your life forever!

  • macsnafu

    All value is subjective, i.e. determined by what people think about it.  This includes not just Bitcoin or U.S. dollars, but also gold, cars, and water.  It's not fictitious, it's merely subjective.  Money was originally created spontaneosly by society, not governments, to solve the problems of bartering, and it's worked remarkably well.  Governments have taken over and monopolized the production of money, thus making money subject to political control, and that's not really good for an economy.  Efforts like Bitcoin are privatizing money production, taking money back out of the political sphere, and once again making it subject only to economic forces, and I think this is good.  Privatized money is the only way to really prevent inflation and the evils of the business cycle (See Austrian Business Cycle Theory).

  • TheCommunistGamer

    I know I'm way late to this party, but Marx covered this in Capital Vol. 1 150 years ago.
    Money is nothing more than an expression of value. I could write pages about this (and indeed I have), but money is simply a way to express value to expedite trade. If I need a pair of jeans I don't have to go either work directly for them, nor do I have to make something that my local Macy's will find valuable; I just give them money. As such, anything can take the place of a dollar and serve the same function, be it BitCoins or hats.

  • Lee Henderson

    If anything couldn't a virtual currency that's existence has a value based on how difficult it is to create be more stable than what we currently use? It would be like going back to the gold standard, but that is too complex for me to understand confidently enough to comment on.

  • chad deffler

    Heres an idea, without a realist ontology to base a metaphysical truth or value on, all thats left are enforceable power-structures and ideologies grounded in psychological fantasies, each wrangling to organize culture. That the post modern freedom from a universal truth also removes any possibility for a rational democracy,( as opposed to a irrational democracy where politics manipulates irrational energies ie, libido, racism, fear,ect)  That a plurality of groups can not possibly have a common ground discourse about much of anything rational, due to a plurality of splintering paradigms forming tribal linguistic traditions, nor give public expressions that are universally meaningful beyond emotional expressions of i feel, ie i feel this is just, good, beautiful, true (See Mcintyre) That when there is not an establish metaphysical reality to ground a shared discourse, all thats left is a vacuum for constructed meanings to battle out dominance by means of will, manipulative tactics,cunning and soft forms of totalitarian control (see zizek).

  • Epicsurvivor !

    i play tf2 and everything has a value couse u can sell it on the market so u can sell one item and get a few centce or dollars soz ya

  • redneckhippiefreak

    This is an old vid an update would be nice..So, Bitcoin is now regulated and recognized by the Fed. as a currency. Go bitcoin yeay..well, . untill another bitcoin gild member decides to run off with the cash again. LOL BTW the amount STOLEN by mitgox was estimated at 500 million and that was only 1/5th the total amount in circulation at the time. As of today 1/14/2016 we have over 15 million bitcoin in circulation. My math isn't great when messing with big numbers but $450.00 X 15.7 million is around 6.75 billion? I may have missed a decimal point..

  • Jordan Pohl

    Well this is very similar to the early introduction of standardized currency in various countries through out history. Early metals like iron had value because they could be used to produce a useful product, while gold was beautiful and hard to extract it making it scarce it had very little useful product value. Yet large nations such as Rome gave gold a productive use, by saying that a bag or rice/wheat/barely, was valued at x coinage to help facilitate a stronger economic trade structure. While gold has a value given by people it alone can not satisfy any human need for survival as say a bag of wheat does and should by assumption be worthless. So this is probably not the introduction of a looser currency, but regression to an old progressive medium where we are defining something to have some sort of value of similar exchange in a different medium.

    The loss of the gold standard came from the improved extraction of materials that devalued the material being sought after a long with an economy that rapidly out paced the government backed gold stores that could have potentially broken the gold standard in a similar manner as if too many people try and extract water from a well. While countries still trade gold to maintain currency value this is a totally vestigial process since there is not proper backing of paper currency. So do I think it will be a future currency probably yes, but it won't be this magical thing instead it will do what gold coinage did to bartering and what paper currency did to the gold standard. However as computer get increasingly powerful I believe that we will see a collapse in bitcoins as computer become faster and faster at solving such algorithms and visual puzzles at a rate that will devalue the bitcoin much like the improved extraction rates devaluing gold.

  • Caelen Tigris

    I'd guess someone brought it up already, since I just saw this episode over three years after it was made, but watching made me think of bottlecaps from the Fallout series. Caps don't have much intrinsic value, much like paper, but they work as a medium of exchange.

  • Yatukih001

    In the future all currencies will be either cash and coins or transfer of money via cards. There will be no such thing as Bitcoin or PayPal. That will be illegal. Just like it will eventually be illegal to advertise for programs as if they are being antivirus software.

  • Im Tabe

    Basic economics 101: There is no "intrinsic" value, all value is subjective. Try selling gold to a man dying of thirst.

  • Sollertia_

    You got the ref thingy wrong. But that's not that important. Yes, I think "alternate currencies" have real world worth. After all, current global currencies are basically papers that the majority accepts have value.

  • Propop pop

    Cs .go skins are used more like currency I.e give me a skin and I will give you a hack
    Also you can trade it in for money so It's like a iou

  • Sparrow

    I'm not too familiar with bitcoin, but in the game Team Fortress 2, the gold standard still exists as keys. Keys are always worth $2.50 and as a result it is the 'gold' of that video game. Refined metal serves to represent a certain amount of keys you have. Which can be bought or sold for actual money.

  • M-Ting-a-ling-ding

    Well there's something else important about TF2 trading and hats. While they are just digital, worthless items when it comes down to it they still serve a function in game. To some they are a marker of skill or experience. A sign of wealth or luck. TF2 hats ( and unusuals) are the same as when we buy a really expensive hand bag just because it's Gucci when a five dollar bag from Walmart would have been good enough. Unusuals also have a MASSIVE range in values from ~$18 (quicksell low tier) to $15,000+usd (Burning Flames Team Captain). It is also certainly possible to "buy dinner" with your hats. People can sell their hats or keys with PayPal. Take the TheVirtualEconomist here on YouTube for example. If it's possible to profit from a virtual game while taking advantage of the same economic concepts used in our stock markets, why not?

  • Fabian Deijle

    5:07 "or a car anytime soon" lol a hightier trader friend of mine bought his first car with his trading money, i think he currently has a 10 thousand dollar inventory

  • Jay Bingham

    "…has intrinsic value like gold"? huh? not quite. gold is heavy and malleable..generally not what you look for in a metal or an active currency. a dollar is a great source of kindling. and if you spent enough in marketing you could convince people that jewelry or clothing made from it actually has real value..same as gold…or binary code that generates a digital hat. there are no things which have true intrinsic value. it is all ultimately conditional.

  • Follow Your Dreams Just Like Hitler

    This guy is unoriginal and speaks as if I am a child and he overuses unfunny memes to compensate.

  • Q.Q6x6CW

    "Ehi, see this barbeque hi-tech table? I want it"
    "Hold up Cowboy, give me money."
    "I won't give you money. I'll give you a cowboy hat for this"
    "(T_  T )"
    "With a flying skulls on it"
    "O (0) O it's yours, cowboy!"

    I want this world NOW

  • Liam Keough

    you also get free cheap items, giving everyone about 1 ref (refined metal) every month of regular play, without paying anything

  • Fernando Rolon

    the problem with the hats is that the real currency are keys and the price of keys is really high and it keeps getting higher and higher making de refined metal lose its value because the metal doesn't have any other use

  • Aaron S

    Id be interested to see who would make the regulations to secure internet currencys as a stable/trustable currency, for example: imagine the unusual hat becomes the universal currency, every one uses unusual hats to pay for things, whats to stop the Tf2 team from giving unusual hats to itself or, more interestingly, what if anarchist hacker manages to get in and destroy all unusual hats? what happens when all currency disapers?

  • username 10000

    its funny because the burning flames team captain its now around 13 000 $. and someone sold his tf2 backpack to buy a car.

  • Patrick Dempsey

    I know this is a troll-y comment, so sorry in advance: Steve Martin & Talking Heads? This guy stole my childhood.

  • sypen1

    Gold doesn’t have intrinsic value besides jewelry what’s it good for I can tell you if there’s a zombie apocalypse it would be worthless only things that have real intrinsic value is things that humans need such as water food medicine these are the only things that have intrinsic value not a shiny piece of metal.

  • Helix

    I know this video is really old but I wanted to point out that he is like a Vsauce for everything but science and other cool stuff.

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