Episode 102: Disruption Presents Opportunity

After a disruptive year in 2020, there are new challenges in 2021, but also immense opportunities in numerous fields. In a deep and wide-ranging conversation, Mark Maunder and Kathy Zant discuss artificial intelligence, whether or not we’re living in simulation, cryptocurrencies and the opportunities of blockchain technology, open source communities and publishing, avoiding scams and FOMO, as well as what fields are most promising for the next 10 years. 

Here are timestamps in case you’d like to jump around, and a transcript is below.
1:51 Familiarity of disruption growing up in South Africa
5:00 Artificial intelligence
10:34 Are we living in a simulation?
13:54 What is amazing about 2021 from a historical perspective?
20:21 What’s happening with blockchain, cryptocurrency, and Bitcoin
24:16 Blockchain technology
27:12 Blockchains in publishing
28:51 Blockchains and contracts
32:08 Cryptocurrency investments, speculation vs. investing in yourself
36:59 What opportunities exist in WordPress
39:54 Disintermediation and opportunities for content creators
42:38 Opportunities in the next 10 years
42:43 The Robinhood/GameStop incident
47:18 What fields hold the most promise in the next 10 years
52:15 Discernment in the face of scams, sales, news, and managing FOMO

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Episode 102 Transcript

Kathy Zant:
Welcome to Think Like a Hacker. This is the podcast about WordPress, security, and innovation. This is Episode 102. We have a little disclaimer because we’re going to be talking about some interesting topics. So we wanted to let you know that this podcast contains the opinion of the presenters and is for informational and educational purposes only.

The podcast is not intended to provide investment, financial, legal advice and the presenters are not licensed professionals. We suggest you seek a duly licensed professional for investment, financial or legal advice. Sounds pretty scary, Mark?

Mark Maunder:
Yeah, thank you K&L Gates for putting that together. But yeah. Seriously guys, we’re not providing investment advice here. And I certainly hope that we don’t provide you any sort of inspiration to go off and speculate or anything like that.

Kathy and I are going to be chatting about the landscape and the interesting world that we find ourselves in and we may cover some topics that relate to things like cryptocurrencies and so on. Please don’t think of that as any sort of investment advice.

Kathy:
Definitely. You’ve heard the Chinese curse of, “May you live in interesting times,” I’m sure. I think where we are in 2021 after an extremely disruptive year during 2020 with COVID and lockdowns and all of that, where we are now at the start of 2021, it’s the end of January when we’re recording this, there’s been a lot of disruption and with that disruption, there’s a lot of challenges but there’s also a lot of opportunities.

And Mark, we wanted to talk to you and kind of get some of your thoughts about where we’re at and where we’re going. I have some questions for you. Can I ask them?

Mark:
Yeah, for sure. It’s funny, you mentioned the interesting times thing. I was on Twitter the other day, and I tweeted about COVID and 2020. I found it to be somewhat exhilarating. I took a bit of heat for that, as I probably should have. I think that a lot of folks are going through really tough times including some folks that I’m very close to who run restaurants and that sort of thing. And they’ve had a really tough time of it. But for me, I grew up during apartheid in South Africa during a time of huge disruption and uncertainty, economic, political, security, personal safety, that kind of thing.

My sort of young parents at the time were raising a family. My brother was born in an operating room with a doctor who had a gun on his hip, for better or for worse. And then for the next sort of 19 years of my life until South Africa became a democracy and Nelson Mandela became president. There was a lot of uncertainty up until that point. And so I’m used to it. I’m used to this sort of sense of…

When I first moved to a developed country like the UK, I moved there when I was 23 and I was there for five years, I found it to be very different. It was just very stable, predictable. The debates on the television were fine tuning a working system and even though they were… They seemed to be way more passionate than the political debates you saw in South Africa, where they were kind of inventing a political system from the ground up after this sort of awful white supremacist government that was in power.

It’s just interesting, the shift. I’ll just chat about that for a second. It was exciting watching a country being created from scratch in the ’90s with South Africa becoming a democracy, but then that uncertainty consumes a lot of your mental bandwidth as well as concerns for safety and that kind of thing, instability and economic uncertainty and so on.

One of the things I found when I moved to the UK and then ultimately the US, where I’ve been for almost 20 years now, is that I get that mental bandwidth back, where I’m in a stable, predictable system. Even though of course, everyone out there in the US is like, “Oh, everything’s going to fall apart.” But relative to emerging markets and developing countries, the US, the UK, Australia, New Zealand, Canada, countries like that, Germany and so on are just incredibly stable and incredibly safe.

The currency is stable, unemployment is very low. There’s tons of opportunity, there’s easy access to capital and so on. And so in that environment, where you’re not sort of thinking about all these things that provide that uncertainty, that mental bandwidth frees up for creativity whether it’s writing, or writing software, or creating films or whatever it is. That’s the bright side. But I think globally, we’re entering a very… We have entered a very interesting time and a time of great change and a great opportunity. Whenever there’s huge change, there’s huge opportunities that emerge.

Kathy:
There are. Do you think with all of the technology that is… Obviously there’s political change that’s happening all over the globe and uncertainty right now, I think. But technology is bringing a new sort of, new variable to the change. I wanted to ask you, do you think that… Where does artificial intelligence fit into all of this?

Mark:
Well, that’s a phrase that I’ve taken issue with for a long time. I personally don’t think that artificial intelligence is a phrase that should be used. I don’t think… In my opinion and by my definition, I don’t think it exists. I think there’s just some computer scientist, Larry Tesler, who said that artificial intelligence is whatever hasn’t been done yet.

And I think if you look at some things that have been done quite some time ago, like speech recognition, having computers play chess, military simulations, adaptive packet routing on networks, these things were considered artificial intelligence and now they’ve been done, they’re relatively mature and they’re not kind of lumped into the AI camp, and sort of emerging things are like pattern recognition and so on and computer learning and a lot of the development that’s been done in neural networks and so on.

And so, whatever hasn’t been done yet and as emerging is, I think a lot of folks will label that as artificial intelligence. What they’re really doing is they’re describing… They’re just kind of labeling algorithms as emerging or new.

Algorithms have been around since the Babylonians, 2500 BC. Division was being used back then as well as the Egyptians around 1500 BC. And so division is technically a kind of algorithm. 240 BC, the Eratosthenes, I’ve mispronounced his name for years as Eratosthenes. Someone corrected me, but I think it was… I read somewhere that if someone mispronounces a word, it’s probably because they read it rather than heard about it which actually gives them kind of a little bit more street cred.

Kathy:
Yeah. Exactly.

Mark:
Eratosthenes, the Sieve of Eratosthenes was developed around 240 BC, which is a way to find prime numbers. I think computer science students still write that today in code but that’s just an algorithm and that was 240 BC that that showed up and it’s perhaps then they felt that the Sieve of Eratosthenes was artificial intelligence, it’s a magic way to find numbers that are only divisible by themselves and one. Ninth century, Al Kindi an Arabic mathematician, use frequency analysis to break primitive cryptography. Same thing there, right? Oh, that’s the new AI. AI, as Larry Tesler says and in my opinion, is whatever hasn’t been done yet.

Now, General AI which is really a computer emulating human intelligence, there’s been a lot of thinking around that. There’s been a lot of sort of paranoia around that. Or well, generally AI is going to emerge and it’s going to make us all slaves. And I think the trouble with artificial intelligence is it’s really us humans applying our human lens to computers. And computers aren’t human.

In fact, they have capabilities that are far beyond what us humans have, particularly in terms of speed and the ability to repeat operations and that kind of thing. Those capabilities are things that we don’t have and they’re new capabilities that are being added to our human capabilities. And yet what we do is we look at a computer and we were like, “When are you going to become human?” Or, “How can I sort of match you against human intelligence and try to pretend that you do have elements of human intelligence and so on?” And I think it distracts from the incredible capabilities that computers do have and things that they are particularly good at.

I think this idea that general AI is going to emerge and there’s going to be this kind of singularity and that general AI is going to be very similar to human intelligence and also have elements of human maliciousness and vindictiveness and evilness, and so on. It is just utterly absurd. Computers do what you tell them to do. Sure, the counter argument is, well, the general AI is going to write code that will give it new capabilities outside of what we want it to be. But why would it do that? If we haven’t built its motivation in to do that, why on earth would it do that?

Kathy:
Well, you’ve ruined every movie that I’ve enjoyed over the last 20 years. The Matrix is now gone. That’s the story of The Matrix. The machines takeover and we’ve got like Arnold Schwarzenegger and the Terminator, and the machines are taking over and all of these really scary things that are sort of in the movies.

Mark:
The Matrix is interesting because it actually brings those two concepts together. It brings together we’re living in a simulation. And then it also brings together the concept of general AI being potentially evil and enslaving us. You said a lot of the folks that think that we’re living in a simulation, but also think that general AI might emerge, but if you and I are a simulation, then someone or some entity has actually figured out how to create a simulated version of human intelligence.

So by that logic, general AI actually already exists. You can’t believe both, right?

Kathy:
Sure. Sure. Sure. Yeah, there’s a lot of people who talk about whether or not this whole experience is a simulation. I’ve often wondered if the terrible things that I’ve done to The Sims means that I’ve got some negative karma coming to me from an actual simulation because I forgot about my Sims a long time ago. They’re all probably dead by now.

Mark:
You can start an organization against cruelty to simulations.

Kathy:
Yeah, exactly. You don’t think we’re living in a simulation?

Mark:
We might be. I was just pointing out the contradiction of holding those two beliefs that general AI doesn’t exist and it will emerge and that we’re living in a simulation. And I think a certain rocket scientist might have believed both of those at the same time or at least tweeted about them.

But sure. It’s quite possible that… Maybe even probable, that we’re living in a simulation. If you think about our… The capabilities that we’re bringing online, ultimate and the amount of computing power that we’re kind of bringing online, we’re getting better and better at simulating the real world, the physics of the real world, the interactions of materials and gravity and so on of the real world.

It’s plausible to think that we might be able to simulate chunks of universe. If a species is able to do that, well, the sort of logical conclusion is that they’ll do more and more of it with the hope of determining outcomes. Is our sun going to collapse into a black hole? I don’t think it’s actually the right kind of star, but are we going to all die of COVID-27?

Let’s sort of simulate that and kind of see how it plays out. And so I guess the question then is, well, are we the creators of simulations? Or what if we are just part of a simulation and someone’s just waiting for it to play out? We’re part of one of their many grand experiments and this sense of self and self awareness and so on is a side effect that’s part of the predictive model.

Kathy:
If there was anything that could happen in this world that would tell you yes, or no, that you’re definitely or definitely not living in a simulation, what could that be?

Mark:
Well, I think one of the sort of events that might be quite telling is dying. But unfortunately, you’re not going to be around to share your data with everyone else.

Kathy:
Yeah.

Mark:
How does an entity exit the simulation? I think also if the simulator doesn’t have a good QA team, we might observe some bugs or glitches but our laws of physics seem to be remarkably consistent and bug free. At least the ones that we’ve discovered so far.

Kathy:
Yeah, definitely. Why do you think that 2021 is exciting from a historical perspective?

Mark:
Well, for the first time in history, we’re storing history. If you think about the Egyptians and the Romans, we just have these tiny glimpses through very narrow keyholes into what those societies were like. We’ve got Meditations by Marcus Aurelius, which is an amazing piece of writing. But it almost didn’t survive. I think, at one point, there was only two copies of it.

And that gives us a glimpse into Roman society at a certain point in history. We’ve derived so much from that, but we have a really incomplete picture. You watch Gladiator, the film and it’s so rich, but you don’t really know what the heck was going on back then because the records were written on paper, they deteriorated, they decomposed and so on.

What’s happening now, for the first time ever is we are capturing what will be recorded history in high def but more importantly, it’s being captured digitally. And the media doesn’t need to survive for the data or the signal to survive because it’ll just be copied from one medium to the next, particularly the important writings that are of course replicated millions of times that at very, very little cost. And so huge chunks of the media that we’re creating today, whether it’s CNN broadcasts or Fox News, if that’s your poison…

For example, 9/11 obviously extremely important historical event, at least from an American perspective and then there’s been similar events in other countries around the world. Imagine seeing an event like that but during Roman times, 2,000 years later on high definition video. You can really get a sense of exactly what happened. All of that context of individual people’s reactions and so on. And so everything’s being recorded for the first time ever and it’ll last potentially for perpetuity. That really changes things and you’re just beginning to see the effect of that as people’s tweets from 2007 are being dug up.

Folks who have now become politicians and so on. And they’re like, “But you said this.” And then in a lot of cases, the person’s like, “But I changed my mind in the face of new data.” What do you do? But people expect consistency from especially politicians and leaders and so on. They kind of come after them for that. But I think as the decades progressed, that’s going to be the effects of that are going to be more and more profound, and useful in a lot of cases.

I think another thing that’s just happened for the first time in history, and I know, this might feel like ancient history to a lot of folks out there but for the first time in history, everyone has the right and capability to publish their ideas. That happened around 1990 and 2000, but then the audience for those ideas really emerged around sort of 2010 as Twitter began to mature and it wasn’t just the early adopter bloggers that were utilizing platforms like WordPress to get their word out. It’s kind of everyone is on these major platforms like Twitter and Instagram and Medium and WordPress and so on.

Everyone has the right and capability to publish their ideas. They’re distributed instantly and they have a receptive audience. That’s the first time that’s happened in history. Historically, we’ve had gatekeepers, who would control the printing presses and it was all permission based. You had to have permission to write an article in the New York Times and get your idea out there or have permission from a publisher to publish your book. Those were curated. If there were politically distasteful, the ideas were never published. If there was no sort of profit motive or business model around the ideas, then they wouldn’t see the light of day and so on and so forth.

That’s transformative for human society. So you’ve got the storing of history for the first time in history and then everyone able to share their ideas instantly with a global audience. I think the other big thing is that we’ve moved into a permissionless society, that’s sort of where we’re headed. You don’t need permission to publish your ideas. You don’t need permission to learn. So I think you’re seeing massive upheaval and innovation disruption in education where before, you had the universities and the schools were kind of the gatekeepers of knowledge. And now on the internet, you’ve got… I was studying calculus with Khan Academy for free.

It cost me nothing and I decided to go and refresh some math. I think Khan does and he unpacks Black Shoals, which is a options pricing formula. And before, you’d have to go and do your high school education and then get your undergraduate degree and then your sort of masters in finance and math. You probably start diving into Black Shoals and now you have permission. You can learn as fast as you like and go as far ahead as you want. When you feel like you’re getting lost, you can kind of come back. You don’t have those gatekeepers that are firstly requiring that you have permission to study certain things and then also charging you an absolute fortune.

You don’t need permission to create new platforms and applications. Anyone can learn to code because there are guides out there to get you started and get you going. I’m actually a self-taught programmer. I taught myself how to program when I was about nine years old on the Apple IIe. And there were very few books on the Apple. And so I kind of had to just scrounge and get whatever I could. And there was no such thing as computer science at school, at least where I was back in I think, was ’84 or something like that. And so I know that it’s very feasible and quite easy if you’re passionate about the subject to teach yourself to code. So you don’t need permission to learn how to code but more importantly, you don’t need permission to create really revolutionary and transformative applications.

And I think particularly new platforms, new ways of communicating, new ways of transacting and so on are very exciting. And anyone can do that. Anyone can go onto the internet, have access to the global internet, start writing code in an open source language like Python or PHP or whatever and create whatever the heck they want. And then really exciting, money just became permission-less. Before you needed permission from…

When I was growing up in South Africa and I think until relatively recently, I’d say recently, it might have been a decade ago or more. They kind of deregulated this, but you couldn’t move money out of the country. You had like a very limited quota and if you’re taking money overseas for holiday, you have to go and apply to the government to take money offshore because they’re worried about a capital flight, and so they put restrictions on the ability to take your money out of the country. And of course, the US doesn’t have that restriction. And a lot of developed countries don’t, but a lot of other countries do.

With cryptocurrency, money has become permission-less because you can transact on a peer to peer basis. You don’t have these centralized authorities that are providing a sort of a gateway for governments to regulate transactions. And then of course, the banks have traditionally facilitated transactions and transfers and so on. And they are also sort of gatekeeping banking, and cryptocurrency is peer-to-peer. I think that’s… It’s actually one of the sort of core ideas that Satoshi Nakamoto mentions in the original Bitcoin paper, which is really worth reading. If you’re listening to this and you haven’t read it. It’s remarkably accessible especially if you know a little bit about hashing algorithms and how they work.

But the stated intent in that paper for Bitcoin is to disintermediate the banks.

Kathy:
But it came out in, what, 2008 and there was a financial crisis happening at that time worldwide. There were some other things. There was like Hashcash and BitGold and some other digital currencies that were discussed. But nothing encapsulated everything the way the Bitcoin white paper by Satoshi Nakamoto did, right?

Mark:
Yeah, yeah. Yeah. I think Nick Szabo created BitGold and I think that was a predecessor to Bitcoin. And the problem that Nick had not solved was the sort of proof-of-work thing to avoid sort of double spending and so on and Nakamoto or whoever that is, we still don’t know or whichever group they are, solved that so that you had this public ledger with a consensus of what transactions should be accepted as being valid and authorized and so on.

Kathy:
Do you feel that Bitcoin is a disruptive thing? It’s already kind of created its own market, but the majority of commerce in the world isn’t using Bitcoin. Do you think it has the potential to be a disrupter?

Mark:
I think the idea of the blockchain or a blockchain or blockchains, it brings online remarkable capabilities. I think Bitcoin is a specific blockchain that is being used to store value right now and for speculation. I think in the midst of a lot of concern around the debasement of currencies, there’s a lot of folks that are storing value in Bitcoin and then a lot of folks that are kind of riding on top of that, hoping to buy some and watch the number go up and then cash out at some point.

Bitcoin may be with us for a very long time or it could collapse tomorrow as we discover either a weakness in the protocol or our knowledge of algorithms gets to a point where we were able to defeat certain aspects of Bitcoin or our computing capability reaches a certain point that creates a vulnerability in Bitcoin. And so I think there’s a lot of excitement around Bitcoin and so on. But what I’m more excited about is the capabilities that blockchains in general bring online.

I think there’s some stuff that’s emerging that’s really interesting. Most of these cryptocurrencies are being used to speculate or store value, but they’re not being used to exchange value in transactions. I think there’s still some challenges around very small transactions and making those effective and kind of workable and scalable on blockchains like Bitcoin’s blockchain.

But I think that what these technologies may do and what I hope they will do is enable a whole bunch of interesting things. So firstly, transactions that disintermediate the banks. I used to work for an investment bank, and I’m not going to say who it is, but it’s one of the largest investment banks in the world. And it’s a very well known name. I was based at their London head office and the wealth that I was surrounded by while working there was just unbelievable. Incredible artworks on the walls in each of the meeting rooms. Beautiful buildings, the facilities were incredible, bankers wearing the latest sort of Savile Row suits, driving around in these amazing sports cars.

The junior guys, there was a certain banking celebrity who was 23 years old, at the time. I remember hearing about his salary, and it was just off the charts. All of that comes from essentially exploiting the customer. A value transfer from who was supposed to be their customer, whether it’s businesses or individuals or families, it’s a value transfer from them to the bank rather than doing what the bank is supposed to be doing, which is creating new wealth for these customers or storing and managing existing wealth.

It’s all about creating creative financial products to try to exfiltrate as much money as possible. I would certainly be very excited about seeing banks disintermediated. In other words, they are not the… You don’t need them to wire money around the world. We actually wire money for some of our team to pay them around the world. And there’s a lot of… We had to look long and hard to find a service that isn’t gaming the charges involved. Sort of, “Oh, no. We don’t charge you anything.” But then you look at the exchange rates you’re getting and it’s awful.

You look at the other financial products that are out there like mortgage backed securities, of course, responsible for the 2008 collapse, credit default swaps. There’s just this litany of really complicated financial products that are designed to steal your money, essentially. I think that’s one of the things I’m very excited about is banks being disintermediated and the ability for people to transact globally with each other on a peer-to-peer basis.

I also think that there may be some interesting things emerging in publishing where you have a blockchain potentially that folks are publishing to from a identity, which is identified a little bit like a Bitcoin wallet. The content would exist for perpetuity, so there’s no sort of deleting of tweets, which creates a potentially interesting environment.

You have non-repudiation, where the author can never deny that they published the thing. But then you also avoid deplatforming, where you don’t have the risk of your publishing to Medium or to Twitter or wherever. Pressure can be brought on to that platform by governments, activists or whatever to try to de-platform you and prevent you from sharing your ideas. That’s an interesting capability, for better or for worse. I know that a lot of folks will be like, “Well, that’s terrible.” People need to be deplatformable, if that’s a word. But as I’ve already mentioned, growing up in South Africa and I’ve seen the unbelievable harm that the suppression of free speech can cause.

I think the solution to sort of hate speech and so on is more ideas that are better, more lucid, more influential, more clearly the right choice. It’s not about gagging the evil is about counteracting their evil ideas with the good. And I think that that’s the correct approach, because I was actually writing about this on Twitter the other day. When you create a contract with someone, let’s say I’m creating a contract with you, Kathy, the way I think about it is, well, I like you a lot.

We’ve worked together a long time I trust you and so on. So it’s easy to sort of say, “Oh, well… We’ll just create a contract. We’re just checking the contract box,” but a really healthy way to think about it is, well, what if someone you really don’t like inherits that contract?

If anyone is actually creating a contract or getting an investor on board, I would encourage you to think that way. Sometimes investors end up in nasty divorce lawsuits and the former spouse could inherit the stock or something like that. It’s just a healthy way to kind of look at things. I think that laws should be looked at in the same way, where you sort of think, well, I like the current administration, they’re going to put in laws that are going to really get the people that I think are bad guys. But what if an administration that I really don’t like or that is really malicious or bad inherits those laws? Then what? Then what do I think of them?

Then what do I think of their abilities to suppress my free speech, which seemed like a great idea when I liked the government at the time, because all of the people that I didn’t like were getting deplatformed.

Kathy:
A lot of what’s happening in our world is sort of flattening our interactions. So like interacting with someone in Singapore is as easy as interacting with someone in California. On the internet, everybody’s just a keyboard away.

And then you have maybe an agreement with someone in Singapore but those laws change or that contract has to, say there is a problem with the agreement you made with that person. And then there’s all these international laws that have to be considered and that can be extraordinarily expensive and challenging, right?

Mark:
Yeah. And I think that as we’re sort of entering this new world, one of the biggest risks is regulators. Their frame of reference is the existing way of doing things. Change is uncomfortable for a lot of people and entities. They may just be uncomfortable with change, the regulators I mean, they may want to retain control, they may want to retain power, in certain cases. I’ve been on Clubhouse lately thanks to an invite from you. And there’s been a lot of talk about some comments I think Janet Yellen made regarding cryptocurrency kind of framing it.

This is hearsay, but I believe she said something along the lines or maybe she just in back channel communications was saying that she’s worried about it being used by criminals. And so there’s just talk about how to kind of have that conversation with the regulators. I guess one of the interesting points is that, of course, cryptocurrency at least Bitcoin is far more traceable than US dollars.

Kathy:
Right. I’m pretty sure that the $100 bill is used by a lot of criminal enterprises.

Mark:
Yeah. I think the number I heard was 4% of dollars are used in criminal transactions.

Kathy:
Interesting. What do you think about the investments that people are making in the cryptocurrency markets with a reminder that this is not investment advice and…

Mark:
Yeah. I would just point to that disclaimer at the beginning of the show where we’re not licensed, to provide investment advice or anything like that. But I think cryptocurrency in general is going to be massively transformative. There were certain developments in computer science over the years that have been transformative, hashing algorithms when they showed up really transformed our ability to identify huge chunks of data with tiny strings and hashing has been an integral part of cryptography.

I think public key cryptography is a great example of something that was absolutely transformative. And just to kind of illustrate how transformative that was, if you and I are communicating Kathy on an insecure line, before public key crypto came along, it was actually really difficult for us to establish a secure channel for communication. I think it was the ’70s, they developed public key crypto which allowed me to split my cryptography key into a public and a private key, give you the public key and you then use that to encrypt communication which is sent to me which I can decrypt with my private key.

For the first time, you didn’t have this problem of during World War II, let’s say the allies are communicating with their ships and if they didn’t set up cryptography beforehand with a shared key, that the ship kind of takes with them, they can’t establish a communications channel. When public key crypto was developed, that problem was solved mathematically.

That’s been transformative. Other things that I’m… I’ve been in the web space. EAPoL, which was a Linux API call that is… Not many people talk about or even know what it is. But all of a sudden, Linux could handle a massive number, hundreds of thousands, or even millions of concurrent connections with very little CPU load. and EAPoL enabled NGINX, which far outperforms Apache when you have a lot of connections connected to your server.

It also enabled things like WebSockets, where you have persistent connections from clients that are receiving messages in real time as they emerge. And so that was transformative. I think the blockchain, the idea of the blockchain is transformative as well, for value exchange, currently value storing. It’s enabling a lot of speculation, as one generally sees in bubbles. There’s a public ledger of transactions. You’ve got some interesting capabilities that blockchain gives you. For example, when you transact with a bank, they need to authenticate who you are for certain things and so you have to send them a lot of documentation.

What one can do with blockchain is have a bank like let’s say, Chase, do that authentication, have the fact that you’ve been authenticated stored in the public ledger of a blockchain and then if a second bank needs to do similar authentication, you can just authorize them to do that without having to… And maybe just validate it using it on the blockchain. They don’t have to have you send all that data all over again. And then you’ve got non-repudiation, which I’ve already mentioned, which is you don’t get to deny that certain things happened like transactions or even publishing content if it’s stored on the blockchain that it originated from you and if your sort of blockchain identifier or wallet is known to be tied to you and so on.

So I think the capabilities that blockchain brings are very exciting. I think what I would encourage folks to do rather than speculating on a number going up or down is take that money and that time that you’re going to spend checking the price five times a day of Bitcoin and look at ways that you can innovate around Ethereum, and its API or what sort of applications you can create that provide real value to people or join teams of folks that are doing this. Whether it’s as a developer, as a QA engineer, in customer service, in operations joining collectives that are kind of innovating in some of these new spaces is a way to get involved. I think when you say should I invest in Bitcoin, I think the word you’re looking for is speculate to sort of reframe the question. I think if you look at… I’ve lived through various bubbles as have you.

Kathy:
Mm-hmm (affirmative). The thing that is interesting to me with everything that’s happening with the cryptocurrencies is these are all open-source communities. The Bitcoin developers, the Ethereum development community seems to be massive and they have similar patterns that look like the WordPress community, there’s governance discussed, all of these developers who have specific needs. So it reminds me a lot of some of the things we see in the WordPress community.

And all of these, there’s like tons of different cryptocurrencies and all of them seem to have that same open-source ethos of developing something for the good of humanity and make money at it as well, which is in WordPress.

I was wondering with all of the opportunities that are happening within those open-source communities in cryptocurrency and sort of the mature open source community that we have with WordPress, what are some of the exciting opportunities you see in the WordPress space?

Mark:
I think free speech is going to be a very hot topic over the next decade. For the historic reasons that I’ve mentioned, all of a sudden, we all have the ability to publish at zero cost to the entire world instantaneously. I think for regulators in particular, that idea is maybe horrific for some. It used to be completely permission based and they could sort of go after the newspapers as the central dispensers of the truth and so on.

This idea that everyone gets to speak, because w”e don’t know if that should be allowed.” I think enabling free speech and helping to avoid deplatforming so that there continues to be a free flow of ideas is interesting and a good thing. And I think it’s going to be very topical. And like I said, I think there’s people on both sides of the debate there. I think that’s an interesting space. I think that security will continue to be very exciting. And of course, that’s the space that we’re in with Wordfence with our various firewall and malware scanner and our research and so on.

I think that cyber attacks are going to continue to increase in frequency, intensity, sophistication and so on. And so I think that the need for security to protect publishers and their user base across various dimensions is going to continue to increase. There’s going to be plenty of opportunity there. I think that one of the biggest things that’s happening is disintermediation, where content creators used to need a publishing house to publish their books or a film studio to publish their film or some other kind of middle entity that would take a huge amount of value from them, record companies for musicians and so on.

And what you’re seeing now is content creators becoming literally billionaires because they have a following already, they haven’t really had the ability to monetize that following. But that’s now began to emerge. And so a prime example would be Glenn Greenwald, who was with The Guardian, major newspaper. Glenn is, of course, he broke the Snowden story and you can see him in Citizen 4, Laura Poitras’s amazing documentary, but Glenn was with the Guardian at the time, when he broke the Snowden story. Then he went off with a group to start The Intercept, and so he became part of a collective that kind of ditched the big newspaper and created a smaller organization.

More recently, Glenn has gone over to Substack and become an independent publisher. And he can do that, because he’s got a huge number of followers on social media, and Substack has given him a way to monetize that fan base, those followers directly. And I think they keep something like 10% of revenue, and he keeps the rest and he gets to build a community via his paid mailing list. And I think you’re going to see more and more of that and it’s going to be…

Probably the next few years, some of the most exciting startups that you will see are going to be startups that are enabling content creators to become their own kind of executive producer, that essentially keeps the rest of the money. No more need for a record company, no more need for film studio, no more need for book publisher, no need for a newspaper, if you’re a journalist to get your message out there. Even personalities, launching beauty products directly to their fan base and owning the company behind those beauty products and keeping the vast majority of the revenue. I think WordPress can be a big enabler for that. I would say that’s another big opportunity.

Yeah. I think disintermediation is already and will continue to disrupt investment banks. Like I said, film studios, record companies, book publishers and VCs, connecting investors directly with startups. But I think WordPress at its core is a publishing platform and I guess it’s become an eCommerce platform as well. But as a publishing platform, I think it’s very well positioned to take advantage of the wave of disintermediation and sort of content creators taking control of their own content and businesses.

Kathy:
Definitely. I think WordPress, really sets the stage for a lot of that. So many content creators with WordPress is the easiest solution for them to get started with. What are some of the biggest changes that you think we’ll see over the next 10 years?

Mark:
Well, we’ve chatted about banking, but I think in that space, it’s been proven fairly comprehensively that active fund managers are completely obsolete and actually have a hard time beating the indexes. Those folks have been discredited and you’ve got individual investors kind of managing their own portfolios.

Kathy:
The Robinhoods?

Mark:
Yeah. Well, I was just laughing because of this GameStop thing that’s going on as it sort of… Really interesting phenomenon where hedge funds have I think, shorted the stock. And individual investors are taking revenge and being kind of activists. It used to be that activist investors were big hedge funds with sort of big name individuals and now it’s like cancel culture meets banking, right.

Kathy:
Yeah, I saw something today in looking at that, that they had actually… There’s two different hedge funds that have shorted more GameStop stock than there is stock available. It doesn’t make sense. And I guess these individual investors on Reddit got together.

Yeah, so it’s set the stage for an interesting dynamic. But I mean, it’s just what the internet does though. It flattens everything. There’s no centralization of power. Hedge funds don’t have more data than the average investor. The average investor could go look up charts just as easily as a hedge fund manager can.

Mark:
Before, options trading for example, was a fairly sophisticated and exotic financial product that was used by big funds to hedge risk. Now, the ability to trade options is accessible to everyone. And more importantly, the knowledge is also accessible to everyone. Just go and read Options as a Strategic Investment by Larry McMillan, which is like the Bible.

I think the book costs like 50 bucks. And that’s… I think the CEO of Goldman, if I recall, that’s kind of… That was actually how he ended up becoming a successful trader and so he basically talked his way into the job and read the book over a weekend and then became a derivatives trader off that. That knowledge is now available in many forums all over the internet. And so you’ve got these sort of retail folks that are trading the same kinds of financial products that the hedge funds are trading and going up against them in an activist way and as a collective via Reddit.

Kathy:
Yeah. I saw some posts where people were just like, “I only have $50 but I never want to see it again. If we could just do this.” And it’s just historic, I’ve never seen anything like this. So it’s fascinating.

Mark:
It is an interesting time because the regulator’s haven’t caught up. For example, to invest in startups, you have to be an accredited investor, you have to have a net worth of above a certain amount to prove that you can handle the risk of doing that kind of investment, which is absurd, because anyone in this country anyway, can go and become an options trader and the risk of certain kinds of options trades up is potentially infinite.

If you’re writing uncovered calls, you’re giving someone the rights to buy stock from you at a certain price. If that stock price continues to go up, let’s say it goes from 50 bucks to 800 bucks overnight, you’re going to get… That contract is going to be cold on you and you have to go out and buy that stock for 800 bucks and then you’re contractually obligated to sell it to someone for 50 bucks. You’re taking that loss and it’s very easy to get an options trading account that gives you the ability to do that, and overnight clock, potentially infinite losses that will ruin you. And there’s been quite a few stories about folks that have actually been taken out by that.

I think a young man recently committed suicide because he thought that he’d lost big trading options. It turns out, it was just a temporary sort of glitch. I believe that was Robinhood on that particular platform. This idea that, well, you can’t invest in startups, but you can trade options, there’s some sort of recalibration that needs to happen there as they catch up.

Kathy:
Well, what kind of fields or jobs do you think are going to be winners in the future?

Mark:
Well programmers, obviously, if you know how to code, it doesn’t just give you the ability to create things, it lets you have a deeper understanding of how blockchain algorithms work. It lets you make smarter decisions about what to get involved in, who to work for, who to believe and so I think I would encourage folks to at least get a basic understanding of programming.

I will say, though, that working as a programmer is not for everyone. I think a lot of people get into it, because they want prosperity, they want a good income, but they’ve kind of like shoehorned themselves into the job. And it’s not for everyone. And I think that may be one of the big reasons one hears about burnout. I’ve programmed for a very long time. Decades. And I’ve spent probably a decade and a half working incredibly hard before this business was successful. I never got tired of it. I loved it. It was for me, but I’ve been doing it since I was like nine. I was just really, really into it.

Not everyone’s into it. But I don’t think you have to work as a programmer. I think you can learn… I think Python is a great language to learn or PHP as well and it’s a real enabler.

Kathy:
You look at some of our threat intelligence team, they’re not sitting there writing code, but they can read code, they can determine what code is doing. And it engages a different part of their brain and doing some of the malware analysis or doing vulnerability analysis. They’re not coding, but just understanding how that code works opens up so many opportunities for them. They’re not coders, but they’re brilliant at understanding code.

Mark:
Yeah, yeah. Chloe and Ram, Matt Ruznak, who’s in QA, folks like that. And then I think other fields, or just kind of expanding that, if you’re not into being a programmer or learning it, I think joining collectives of software engineers, whether it’s in QA, operations, customer support, so on can kind of give you a path to prosperity. Then one of the fields that is being most quickly transformed is education. You’re seeing the emergence of the celebrity teacher for the first time. You’ve got folks that…

It’s interesting because teachers have historically been terribly underpaid. Whether it’s high school or university level or even professors with doctorates don’t actually earn that much. But if you’re the sort of world expert in a particular field and you have 50,000 people out there who are really passionate about studying this particular beetle and seeking it out in the desert and you happen to be the guy, there’s a very, very lucrative business model in there for you where you’re looking at potentially a seven figure income every year and you’re a beetle expert that was going to earn $80,000 a year at UW as an associate professor in the field.

I think purveyors of knowledge, whether it’s woodworking or more advanced fields like physics or philosophy, I think of Khan from Khan Academy. I forget his first name. Is it Salman? He’s a world celebrity now. I believe he’s running a nonprofit. His salary was something like 800,000 per year, which to be honest, I think, based on the value that he’s giving the rest of the world is quite modest. I think you’ll see a lot of niche players and niche kind of educators emerging.

I think anyone who’s creating IP that has value, in other words, intellectual property, where you can sell the product, an infinite number of times for zero additional marginal cost per unit sold is really exciting. And so that is a real enabler for musicians who used to have to go through the gatekeepers. In other words, the record companies, they can now create a piece of intellectual property, either a song or an album, and sell it an infinite number of times, writers, book publishers, either fiction or nonfiction.

I think the film industry is ripe for disruption and lagging very far behind. Filmmakers are creating IP and again, holding on to the rights of that IP and then selling it millions of times over the next two decades and generating recurring revenue from an intellectual property. I think anyone who’s creating IP, that is also a very exciting field or area.

Kathy:
Yeah, so it really gives us people who have a passion about a particular subject area, they get to really immerse themselves in that and create a living based upon doing that. But on the other side of it, for the people who consume that kind of content, I want to ask about discernment.

How do you tell that you’re getting the best? How do you avoid scams? How do you avoid the fake news or the purveyors of information that is untrue or the speculators who tell you that Bitcoin’s going to be $1 million by the end of 2021. How do you have discernment to know that you’re getting the best information when so many people are throwing their knowledge, opinions or… How do you find the real experts?

Mark:
Well, I think if you find yourself nodding your head vigorously whenever you’re listening to the thing you listen to, you’re probably in the wrong place. You’re just reinforcing your own beliefs. I think one should learn the difference between opinion and data. Perhaps all the major news networks have gotten into editorializing in a big way.

I think you can easily tell that that’s going on when you are being told what to believe rather than being presented with new data or accurate data. I would encourage folks to seek out sources of data rather than sources of the interpretation of that data. In terms of avoiding scams, I think only… And you and I have lived through the dotcom bubble and then the housing bubble. And so those are very instructive for me. I think only getting involved in things you understand is important.

And so I remember in the dotcom days, the phrase was you either get it or you don’t, or so and so it doesn’t get it. And get it was the sort of vague phrase that was used to signal well, there’s something really innovative going on here and you better get on board or you’re going to be left behind and so your FOMO or your fear of missing out kicks in and you quickly invest and hopefully you got out before the bubble burst.

Kathy:
Yes, that time pressure that we see with social engineering attacks. It’s almost the same type of thing, this, “You better do this now.”

Mark:
Yeah, I think FOMO is very, very destructive and it’s also very much exploited. I think another red flag for me is name dropping. If you see name dropping when you’re listening to something, run. Clubhouse is right now, if you happen to have an invite to Clubhouse, it is filled with advice givers and consistently you’ll hear them drop names of “I’m friends with so and so. I was chatting with the other day. He or she said such and such, or I was hanging out with Janet Yellen, we were sipping cocktails at such and such a restaurant and across the way with so and so.”

And you have to ask her why are you giving me that data? How is that useful to me or useful to you? And it’s really useful to the speaker because what it’s doing is through social proof which Cialdini has written about if you don’t know what that is. It kind of seduces you into assuming that they must be an expert. And a prime example of this is, of course, Bernie Madoff, who was head of the NASDAQ at one point and had Kevin Bacon and all of these celebrities investing and I’m sure the sales pitches to invest in that fund was,

“Oh, well Madoff is former head of NASDAQ and so on. Kevin Bacon’s invested. Who are you again? Oh, you only want to invest a million dollars? Well, I guess we can fit you in. But you’re going to have to get in line behind the three other celebrities in front of you. But I guess we can take your money, right?”

And at this point, you’re like, “Oh, my God, let me in. I have to have some of this.” But it was a total scam. It was horrific scam. And then going back further than that, long term capital management, which crashed while I worked at the investment bank that shall not be named was a bit of a similar thing. It was a blackbox hedge fund that almost took down a bunch of banks with it and it had all these PhDs that were involved and they kind of figured out the hedge fund thing and how to make free money and so on. And it ended up collapsing.

And there’s plenty of stories like that. But I think all of those social proof elements that you find certain things packaged in should be red flags for you. Whether it’s the name dropping or we’ve got five PhDs or even, we started off the conversation talking about AI, framing it as, “Oh, well it uses AI.” It’s like well, which AI are you talking about? Are we talking about the Sieve of Eratosthenes which used to be probably considered AI or is it something newer than that that is just new and therefore referred to as AI.

It feels like it’s another form of kind of social proof. “It must be good, then therefore, I must get involved.” And then I also think another red flag is the past performance thing, success stories. Again, I guess I don’t want to get into the details of specific scams or initial coin offerings or whatever. But I think that that combined with fear of missing out is a real killer for a lot of people.

They see the wealth creation stories of someone trading options, writing uncovered calls or it’s free money or the particular cryptocurrency or during the housing bubble, I think it was around 2005. I remember being in Southern California and going to a seminar, where this guy, literally this line of people were getting up and talking about how they’re buying their ninth property that they’re speculating on with a zero-down mortgage and how wealthy they are on paper and how they’re doubling down and so on.

I’d like to think that I felt icky and left, but maybe I just didn’t have the means to invest back then, but I’d like to think that I was smart enough to avoid it. But it was the same thing, right? It’s the past performance sell. If that’s the main pitch, run. And then just managing your own FOMO. If you feel the tingle of why am I wanting to do this thing, get involved in this thing, work for this thing, invest in this thing or whatever? If you feel the tingle, well, maybe it’s because I’m feeling like I’m going to miss out. Just take a break. Just walk away. If you can’t walk away because someone’s telling you there’s time pressure, well, that’s another red flag.

Kathy:
Yeah. I think there’s so much opportunity and so many interesting things happening in the blockchain space, especially that it’s open source and that there’s communities associated. I’m fascinated by it. And I think that the Ethereum project is definitely very fascinating. And there’s a couple of other ones that are really neat. The whole idea of a blockchain that cannot be edited, that is fair, has fairness built into it. There’s so many different applications and I really think that we’re at the precipice of some big changes.

But the idea of like, “Oh, my gosh, I better invest in this.” Rather than, “Oh, my gosh. I can see what could happen with this.” And investing because I can see what can happen from this, those have very different vibes.

Mark:
Yeah, I think the most valuable investment that you can make is in yourself. And then education that adds specific capabilities. I love learning. I’ve learned throughout my entire life, and I’ve self studied everything that I know. I think developing a love of learning and making your learning focused on adding certain capabilities to yourself whether it’s learning how to code, how to write, I’m very passionate about film for example.

And I think finding the sort of world experts in the field and learning from them, there’s a lot of folks out there that are sort of, “Buy my course, buy my YouTube video.” And so on. But there’s certain experts that everything else is derived from. I’ll give you some specific examples. With screenwriting for example, a lot of people will read Save the Cat! by Blake Snyder. Blake, may he rest in peace, I think he died in 2010 suddenly, Save the Cat! is considered a transformative book because it makes screenwriting formulaic and gives you the sort of formula to write film. It just has to have certain elements like a catalyst, a third of the way into the story that kind of sets the protagonist on the course of their adventure.

But no disrespect to Blake, a lot of those ideas are taken from the guy who is the guru and that’s Robert McKee. And he wrote a book called Story in the 1990s. And it’s a thick book that’s very comprehensive. And it’s absolutely wonderful because it turns storytelling into a science or into and sort of an engineering discipline. And he really goes into a lot of depth. And so finding out who the absolute expert is in the field, it saves you a lot of time because you’re not sort of picking up all these little bits and pieces from all these different sources that are all derivative and then trying to somehow string them together.

You get it from the one place. I already mentioned this in our chat, Options As a Strategic Investment by Lawrence McMillan or Larry McMillan. That is considered the Bible of options trading and it’ll take you from zero all the way to Black Shoals, which is a fairly sophisticated formula for options pricing and beyond. And you’re getting it straight from the original source and there is so much derivative content out there. Another example, this is a book I was reading sometime last year.

Internet Routing Architectures by Sam Halabi. That book was written in 2000. There isn’t a newer edition because it is still as relevant today as it was then. I think we’re still on BGP-4. And it’s about BGP-4 and it hasn’t changed which is a little scary from a cybersecurity perspective. But reading that gives it to you straight from the source.
Mark:
You’re not kind of watching the YouTubes and having to watch for five videos and now you’re still missing three sort of core knowledge components. It doesn’t require that you go to university and do a four year degree in internet architectures. Just read the book. It’s the same with screenwriting. Just read the book. It’s going to take you… There’s an audiobook version actually by McKee, and he actually narrates it himself, which is awesome.

So I think the trick is to really get good sources of complete knowledge.

Kathy:
Good point. That’s the dog.

Mark:
Is he’s snorting? He’s like, “You’ve been on this podcast for… Was it an hour and 12 minutes and four seconds. I’m timing you.”

Kathy:
He’s rolling around like an idiot. He knows it’s his walk time pretty soon.

Mark:
All right. Well, I’ll tell you what. Why don’t we wrap it up there? It’s been a wonderful chat as always.

Kathy:
It has.

Mark:
We’re not going to figure it all out on a single hour-long conversation. But-

Kathy:
We got close though, I think.

Mark:
[laughing] Yeah. Maybe. I don’t know.

Kathy:
It’s always good to talk to you Mark. You think big. And that’s one of the things I appreciate most about working with you and working with the team at Wordfence is that if you have an idea at Wordfence, someone else on this team and it’s usually Mark, will take that idea if it’s any good and take it to the next level and make it bigger. And so I’m always appreciative of talking with you about the big ideas and a little future gazing was definitely fun, this go round. Thank you so much.

Mark:
Well, you certainly help. It’s always a pleasure chatting with you. And you sent me a bunch of articles to kind of catch me up on my thinking before we chatted on this podcast. And so I very much appreciate that you definitely contribute to broadening my horizons. Thanks so much.

Kathy:
Oh, thank you. Well, thanks for listening to Think Like a Hacker. If you want more of Mark’s deep thoughts, well, as deep as Twitter will allow you to get find him on Twitter. The link’s in the show notes, but you can find him @mmaunder, M-M-A-U-N-D-E-R. Right.

So anyway, link’s in the show notes. That will make it easier for you and you can find me @kathyzant. And definitely follow the @Wordfence account because that’s where all the fun really happens. And we’ve just put out a report about all the things we saw in security in 2020. You’ll want to check that out. We’ll put that in the show notes as well. And we will talk to you again next week. Thanks for listening.

Mark:
Bye everyone.

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