KOL320 | Stephan Livera Podcast # 249–Bitcoin Patents & Open Crypto Alliance

Kinsella on Liberty Podcast, Episode 320. From my recent appearance on Stephan Livera’s bitcoin-focused podcast, SLP249 BITCOIN PATENTS & OPEN CRYPTO ALLIANCE WITH STEPHAN KINSELLA AND JED GRANT (recorded Feb. 2, 2021; released Feb. 5, 2021). [Update: See transcript here, and appended below] From the show notes: Stephan Kinsella and Jed Grant join me to chat about Open Crypto Alliance. We talk: Why IP laws are anti-liberty and anti-progress How progress has been delayed by improper concepts of property rights How Patent laws could hinder the Bitcoin industry The asymmetry of attack vs defense here How to stop overly broad patents How to support OCA Guest links:  Site: https://www.opencryptoalliance.org/ Stephan twitter: @NSKinsella Jed twitter: @JediGrant Prior episodes: SLP15 – Intellectual Property, Bitcoin, and Internet Censorship, with Stephan Kinsella SLP211 Steve Lee – Bitcoin Grants, Design & Crypto Patents (COPA) *** Transcript Podcast Transcript: dcasStephan Livera: Stephan and Jed, welcome to the show. Jed Grant: Thank you. Thanks for having us. Stephan Kinsella: Thanks Stephan. Stephan Livera: Today. We’re going to talk a little bit about intellectual property and what it means in terms of Bitcoin and property rights as well. I think many listeners of the show are libertarians themselves, but not all of them. And so I think it might be good. Well, firstly let’s talk, let’s hear a little bit about each of you just a little bit on your background. Jed, if you want to start? Jed Grant: Sure. Yeah, I’m a technologist I’ve been in tech. Well, since the eighties, when I got my hands on an Apple II and started writing code I’ve always been interested in cryptography. Somewhat of a cypherpunk, ended up at NATO running their deployment of TCP IP in the nineties and been an entrepreneur for the last 20, 22 years, more or less and focused on, on security and crypto and technology in that space. So Bitcoin is something that I’ve been following since basically when the white paper came out as a novelty and really liked the tech and want to see it change the world. So that’s sort of my focus. For my professional side. I run a company called KYC 3 and I set out to change the way we do KYC because it’s fundamentally broken. So somewhat similar to what Stephan’s going to say. I’m not a lawyer, but I’m a KYC guy, but I’m anti KYC. So there you have it. Stephan Livera: And Stephan, just for listeners who maybe they haven’t heard you before. Can you tell us a little bit about yourself? Stephan Kinsella: Sure yeah, I’m a patent attorney in Houston and Texas, I’m from Louisiana originally and I’m a libertarian and I’ve been interested in libertarian theory and intellectual property stuff for a long time now. And got interested in Bitcoin when it came out and started buying it when I lost a bet to Vijay Boyapati, because I thought in 2012 that the government would kill it. So I lost that bet had to buy some Bitcoins to pay them off. So I bought some for me at the same time. So those Bitcoins are now worth 90,000 or now, $120,000 that I gave him. Stephan Livera: Yeah, that’s great. Vijay our mutual friend, he’s a regular guest on my show. And for listeners who aren’t familiar, Stephan is a really leading thinker in the libertarian world especially in the areas of intellectual property. And also just generally in terms of private property theory and explaining some of the thought of some of the leading lights of the Austrian libertarian world, such as Hans Hoppe and others. I think maybe we can start there as well, because I think for some people they might not be as familiar with this way of thinking and they might be thinking, well, hang on. I thought these people put in work to create intellectual property. So why shouldn’t that also be respected as a quote unquote private property, right? Why is that not correct? Stephan Kinsella: Right. And I guess I thought that too at first, like most people do I mean I come at it from a private property point of view, I favour free markets and private property and individual Liberty capitalism and all that. And I still am and innovation and technology. And you hear about this thing called intellectual property, which includes mainly patent and copyright, which covers inventions and artistic works. And you just assume that, well, this is another type of property rights. It was part of capitalism, but the more I studied the issue and when I started practicing, practicing it in the early nineties as a lawyer. I started looking into it more closely understanding the legal system and then understanding libertarian and economic arguments about it more deeply, came to the conclusion that the systems are completely antithetical to private property and free markets and competition, and it should be abolished. Stephan Kinsella: I mean, completely, I think the patent system and the copyright system are completely unjustified and do tons of harm in the world, especially the patent system. Basically it gives people a monopoly from the government, which allows them to prevent people from competing with them. And that’s anti-competitive and against the free market, it violates their property rights. In particular, the patent system allows you to get a license from the government to sell your product that you claim to have come up with on your own for about 17 years, without anyone competing with you on that. So delays innovation because other people don’t bother to innovate with, they can’t sell a product that’s like yours. So it slows down innovation and it lets you rest on your laurels and connect monopoly profits because you’re the only guy you could sell this thing. Stephan Kinsella: So the standard arguments for it that you need it to incentivize innovation are all flawed. There’s no empirical research for it. And in fact, that way of thinking about it is confused because the purpose of law is not to have the government come in and twiddle the leavers in the market and optimize things that are broken. Like that’s the market failure idea of the Chicago school, which I don’t believe in. And I don’t think the government is really their goal is to do that and they’re not equipped to do it. And the patent law system won’t do that anyway. All it does is help monopolies grow larger and help cartels and oligopolies form. Stephan Livera: Right? And so some might believe that, Oh, this business model, it requires intellectual property for it to be viable. And without that, these businesses would just not work and maybe they would say music or art or maybe writers. And, but fundamentally it comes back to, as you were saying, it’s about private property rights and the need for private property rights to be granted or issued only in things that are scarce. Like rivalrous. And I guess as you’re saying, if you, or if the government grants somebody an intellectual property, right then in some way, shape or form, they are giving some people the right to control what other people do with their own private property, whether that be their own piece of paper, that they are writing down a poem or a whatever, or their own computer. Right. And so that you are giving some people the right to control other people’s computers, but we are just in some sense the guns of the government to enforce that. And that is anti private property rights. Stephan Kinsella: Yeah. And there are definitely some business models that won’t work without IP, such as the business model of being a patent attorney. Just like it’s like without a tax system, there wouldn’t be tax attorneys and those types of CPA’s and without a drug war, there wouldn’t be defense attorneys making money, defending people who are facing prison time for doing something that’s a victimless crime. And there are probably some business models in the regular business world that would have a tough time making it without IP law. But by the same token, nothing is for free. So if you make something easier, you’re taking it away from something else. And so other business models are the seen and the unseen, by Bastiat. We see that some companies claim to make profits from their copyrights and their patents, but that’s at the expense of innovations and creativity. Stephan Kinsella: That’s suppressed hands of other people by, by virtue of these laws. So from the empirical point of view, people that just have this thing, like you need it. Well, we’re just used to it. We’re used to these laws. So it’s hard to imagine what it’s like, what it will be like to have a fully free market, just like in most countries outside the U.S. Who are used to socialised medicine, they’re used to thinking of medicine as something the government provides and they can’t imagine what it would be like to live in a free market healthcare. But that doesn’t mean that we shouldn’t move in that direction for anyone interested in looking into this further, there’s a ton of resources on my site C4sif.org. And you can find there, let’s say a link to Boldrin and Levine’s book against intellectual monopoly, which just goes in detail over the empirical arguments, given in favor of patent and copyright and shows how each one of them are just flawed and wrong. Stephan Livera: That’s excellent and for listeners as I would echo that. So definitely go and read. Stephen can sell his against intellectual property. And also that Michele and Boldrin book where basically there are many examples of how society has been slowed down. The progress of society has been slowed down. Arguably the industrial revolution was delayed by I believe, 18 years. And that’s the example from the first chapter in that book. So there’s a really great example, actually.