Peter Thiel and Reid Hoffman: Crypto is Libertarian and AI is Communist

Peter Thiel and Reid Hoffman, the two original members of the PayPal Mafia, engaged in a rigorous debate at Stanford University in early 2018 concerning the relationship between technology and politics. The discussion was focussed on decentralized and centralized technologies like cryptocurrencies and artificial intelligence, and how their underlying technical frameworks are implemented in different political regimes.

Technologies Don’t Map Precisely

While Thiel, the former chief executive officer of PayPal and Hoffman, the former CEO of LinkedIn are big supporters of the emerging technology sector, they have supported opposing sides when it comes to the field of politics. Thiel strongly supported President Trump during the 2016 election while Hoffman, like many others in the technology community, sided with Hillary Clinton. Hoffman even acted as Clinton’s advisor and even funded part of her campaign and causes.

In the conversation moderated by Niall Ferguson, he opened the discussion to question the existing political landscape and whether it will remain on the same trajectory.

He wondered if the U.S. is still “going to be having a left-right debate or is it going to be a different kind of politics? Is it going to be authoritarian v.s. democratic, establishment v.s. populist, growth believers v.s stagnationists?”

Thiel noted that technologies don’t map in a precise manner that Ferguson described. He also commented that it’s a “treacherous business” as it’s relatively hard to predict the trajectory of future tech and politics. Thiel, however, noted that while predictions are difficult, he remains curious about the decentralization v.s centralization movement that’s occurring today.

Cryptocurrency is Decentralized while AI is More Centralized

The decentralization Vs centralization movement focuses on two areas of technology that have gained great interest and popularity in Silicon Valley. These two areas of technology include the cryptocurrency industry and the artificial intelligence (AI) sector. Thiel drew significant parallels between the cryptocurrency industry and its decentralized state and AI’s centralizing tendencies.

Thiel declared that “Crypto is libertarian, AI is communist,” pointing to two extremes of the technological and political ideological ends.

According to Inc, when Thiel commented on cryptocurrencies, he was looking more at its underlying blockchain technology and how it has the potential to change the way society operates and functions.

Unlike existing technologies and centralized entities, cryptocurrencies are generally open-source and therefore allow anyone who can code to contribute and become and a member of the community.

Even those in the community who are disgruntled by the cryptocurrency’s future direction can choose to create a new coin by forking it from the original. For example, Bitcoin Cash is a fork from Bitcoin, and Ethereum Classic is a fork from Ethereum. Furthermore, when these tokens are purchased or earned, no one in the community or system can confiscate the tokens unless they have access to or have compromised the user’s private keys.

Cryptocurrencies were, therefore, also originally designed to bypass regulations and governmental control even though some countries like China have banned its use.

Artificial intelligence, on the other hand, is dependent on big data which is often collected by large centralized entities. A great example is Google. The search engine giant is a large centralized entity that can leverage off machine learning because of the sheer amount of data concerning user behavior, search, images that have been collected over the years.

The Relationship between Technologies and Politics

By understanding how these emerging technologies function, Thiel also mentioned in the debate that these trends and patterns are also mirrored in politics. Throughout history, communist nations like Maoist China and the Soviet Union also seek to create very centralized dominating economies.

Technically, a very powerful and clever A.I. could even assist the state by predicting the growth, yield and production of resources like potatoes way ahead of its time from very far distances away. Since communist countries love the control the political system provides, it is no surprise that “the Chinese Communist Partry hates crypto and loves A.I.”

While Hoffman agreed with Thiel, he also provided another metaphor, stating that cryptocurrencies are “anarchy” and artificial intelligence is “the rule of law.” Thiel provided many key insights, yet Hoffman was much more positive and optimistic about Silicon Valley’s ability to create products for the greater good of humanity.

Hoffman noted that large technology companies like Airbnb have enabled people to become microentrepreneurs, and used it as a critical example of tech providing more good and opportunities for everyday people. However, despite Hoffman’s optimism, he was also showed great concern about the impact of technology on politics.

He stated:

“We need to commit to Spiderman ethics with power comes responsibility we’re not convinced that this future is going to be good for us, for our future.”

When it comes to America, however, Thiel believes that the economy is only prosperous when it comes to technology.