The 2020 documentary CRYPTOPIA, one of the feature films at the Cayman Documentary Festival on 19 and 20 March, talks to the big brains and big egos of the crypto and blockchain world.
It investigates how the industry is progressing from building an alternative and decentralised currency system with Bitcoin to decentralising the web and the promise of a new form of the internet with ‘web 3.0’.
The Cayman Compass talked to filmmaker Torsten Hoffmann about the industry.
People often ask and you touch on it in CRYPTOPIA. Tell us why crypto isn’t a scam?
In my two films about the topic I try to give historic examples that show how the knee-jerk reaction against almost any new technology is usually to dismiss it. Too many established players, with vested interests and deep pockets, such as governments and banks, are shaping the narrative. Billions of consumers are pretty satisfied with their existing infrastructure. The often misguided media coverage about the environmental harm of mining crypto currencies and sure, many actual scams in crypto land, make it an uphill battle. In CRYPTOPIA, we also ask the big brains and big egos behind this industry some uncomfortable questions.
However, let me try to convince you that this is a “thing that we should take seriously now” as a Wall Street Journal reporter told me in 2014.
– Almost all financial institutions including the big global banks now offer some crypto services to their private wealth clients. Retail customer offerings are next. That’s remarkable after a decade of ignoring, ridiculing and lobbying against it. Meanwhile, there are an estimated 200 million owners of crypto around the world, mostly using new innovative services provided by start-ups. I recently visited the offices of a company that has had 80 million users transact over a trillion dollars worth of crypto in the past ten years.
– Ask citizens of countries that experience high inflation about the usefulness of this invention, particularly Bitcoin. The price is at an all-time high in Turkey, Venezuela or Argentina. Inflation might be closer than you think; even in developed markets. That’s the cost of printing trillions of fiat dollars out of thin air and that’s why the deflationary economics of Bitcoin’s money supply are so powerful.
– Ask refugees in Ukraine who were unable to access any of their wealth this month, or truckers in Canada who were threatened to get their bank accounts frozen, or the women in Afghanistan that aren’t even allowed to have a bank account as we highlight in CRYPTOPIA. These people now have access to the global financial system thanks to crypto currencies, and they can be truly in control of their assets. But yes, you are right. This technology also enables scammers. That’s why there are now stricter ‘know-your-customer’ regulations for the sector almost anywhere in the world.
CRYPTOPIA follows up on a 2015 documentary you made, ‘Bitcoin: The end of money as we know it’. How has your own view of cryptocurrencies and blockchain technology changed during the making of the films and since then?
During filming of the first film, there really only was Bitcoin. Since then an entire industry with thousands of companies, projects and ‘coins’ have emerged. While I believe that decentralised finance will play a major role in revolutionising the global financial system, and while I believe that there will be many ground-breaking web3 projects coming out of this, I have also come to the conclusion that Bitcoin itself is very different from all the other activities: It might be antifragile.
There were a lot of overpromises and under deliveries related to crypto and blockchain so far. Currently, the industry appears to be in a bit of a lull. Where are we in the evolutionary cycle of these technologies in your view?
Yes, correct. When Bitcoin isn’t at an all-time high, there is that perception… but +800% performance in two years isn’t bad in my books. Plus the first nation state [El Salvador] adopting it as legal tender marks tremendous progress that even the so-called Maximalists did not expect so early.
Yes, Ethereum has been paralysed by scaling issues and the promised network upgrades have been delayed (by years now) but there are thousands of projects being built in the background.
And yes, the most recent hype around “NFTs” has been a crazy cycle indeed. I think it illustrated perfectly how these technologies evolve. Some truly innovative projects made some entrepreneurs, developers and investors very rich and a horde of new investors flooded into lower quality copycat NFTs, which mostly became worthless. I don’t think anyone quite knows where this will take us but I am pretty sure that the experts will use fancy words like “metaverse” and “web3” when they try to sell us the next thing.
What do you hope viewers will take away from watching the documentary?
The first film was all about understanding the history and concept of money and Bitcoin (it has 2.5 million views on YouTube now). CRYPTOPIA is an entertaining and info-dense crash course into the entire industry and all its main narratives. It’s a good way for anyone to get started down the rabbit hole.
‘Cryptopia: Bitcoin, Blockchains and the Future of the Internet’ screens twice at the Cayman Documentary Festival this weekend, on Saturday at 6:30pm and Sunday at 4pm.
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