Premieres Wednesday, Nov. 9, 2022 at 9 p.m. on KPBS TV + Sunday, Nov. 13 at 9 p.m. on KPBS 2 / PBS Video App
NOVA “Crypto Decoded” dives deep into one of the most talked about technologies of the moment — cryptocurrency and the blockchain technology that makes it possible. From Bitcoin to NFTs, cryptocurrencies are making headlines and claiming a slice of global financial activity. But what exactly are they, and how do they work?
NOVA examines how and why cryptocurrency came to be, featuring a wide range of experts that go beyond the hype and the skepticism to unravel the social and technological underpinnings of “crypto,” and explores the possibility that this new technology may change much more than just money.
In order to fully understand the revolution that some say crypto promises, “Crypto Decoded” seeks to answer a deceptively simple question — what is money, anyway? Currency has existed in one form or another for longer than written history, and the film looks to experts like Ellen Feingold, curator of the National Numismatic Collection at the Smithsonian National Museum of American History — home to the world’s largest historical collection of money — to unpack this complex past. Feingold explains that anything can be used as money as long as a community agrees on its value. All money is a necessary fiction — built on shared trust.
While banks and credit card companies are largely trusted to track the flow of payments and keep detailed, centralized records, some believe this gives these financial brokers — and the governments who oversee them — too much power. This lack of trust spurred computer programmers and mathematicians to search for an alternative.
For Mark Miller, a computer science student in the late 1970s, George Orwell’s classic dystopian novel “1984” seemed prophetic, as trust in the government was decreasing in the wake of Watergate and the Vietnam War. The film looks at the invention of public key encryption — one of the fundamental components of cryptocurrency — and its promotion by Mark Miller and others.
Envisioning that this new form of communication could give governments unprecedented power, computer scientists and mathematicians raced to create a way to keep online communications private and secure. What they created is something that had eluded cryptographers for millennia: an almost unbreakable code.
Today, public key encryption is central to digital communication and especially, the electronic transfer of money. It’s what makes it possible for us to shop online with relative confidence that our credit card information won’t be stolen with every transaction.
On Halloween 2008 the game changed yet again, when a paper authored under the name Satoshi Nakamoto appeared on the internet. Satoshi introduced Bitcoin, “a peer-to-peer electronic cash system” that revolutionized the cryptocurrency industry. To this day, no one knows who Satoshi Nakamoto is — one of the most significant technologies in recent human history was created by someone who is still wholly anonymous.
The first of many now-popularized cryptocurrencies, Bitcoin removed the “go-betweens,” replacing them with a technology known as “blockchain,” an immutable record of transactions, distributed among all users and secured by public key algorithms.
The film highlights factors that lead to Bitcoin’s success, such as incentivizing its users to maintain the blockchain. Those who contribute computing power to the system are rewarded in newly minted bitcoin, making it the first truly self-contained system, run entirely by users with no central authority.
Inspired by this innovation, one early Bitcoin user saw a different kind of potential. What if crypto could decentralize not just money, but everything? “Crypto Decoded” highlights the creation of Ethereum — now the largest blockchain in the world, running 10 times more transactions a day than Bitcoin.
Unlike the Bitcoin blockchain, which only maintains a ledger of ownership of coins, Ethereum lets users write “smart contracts,” computer programs that run on the blockchain. Ethereum allows anyone to mint and program coins with additional functionality — doing for the blockchain what the iPhone’s app store did for the cell phone. One type of smart contract has taken the world by storm — NFTs (non-fungible tokens).
A newer smart contract we see in “Crypto Decoded” is EquityCoin. Vernon J, a real-estate investor from Brooklyn, and his partner, computer programmer Akil Ash, hope to use crypto to transform a vacant lot into affordable housing in East New York. This largely lower-income neighborhood is one of the many where banks have long been reluctant to finance development, so Vernon and Akil’s project — EquityCoin — aims to remove banks from the equation.
The goal is to replace the bank with a community — for cryptocurrency to give a group of people the ability to create their own systems. EquityCoin is rooted in this concept of “decentralization” — removing the powerful institutions that dominate many areas of modern life, particularly pertaining to money.
“Crypto Decoded aims to demystify this emerging technology — looking at how and why it was created, and its potential impact on our society,” said Pangloss Films Producer Edna Alburquerque. “I hope viewers will come away with an understanding of why this is important to learn about — whether you are actively engaging with crypto or not, it has the potential to shape your future to some degree.”
“There’s a lot of discussion about the current state of the crypto industry and the market has changed drastically over the course of production of our film,” said Pangloss Films Director Peter Yost. “But the technologies that crypto is built around have the potential to impact far more than just the financial sector.”
As “Crypto Decoded” looks at crypto’s technological underpinnings, utopian dreams, practical promise and potential perils, it attempts to answer the question: Is crypto just hype? Or might it usher in a revolution that goes far beyond money?
Many liken the state of crypto today to the state of the early internet — stark parallels are seen as the film takes us through crypto’s invention and transformation over the last few years. New coins, blockchains and decentralized apps launch with staggering frequency. But in this sparsely regulated and wildly volatile environment, it’s hard to know which projects will crash and burn and which will go, in crypto parlance, “to the moon.”
However, as crypto’s popularity increases, so do its complications. As big business gets in on the action and crypto transactions draw the attention of financial regulators, there’s a risk of crypto’s original promise of independence being compromised. As our lives become increasingly digital, many believe crypto is here to stay. But huge questions remain. “Crypto Decoded” unpacks the major questions: What is the underlying technology? What is it good for? And what might the future for crypto be?
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A NOVA Production by Pangloss Films for GBH. Written, Produced, and Directed by Peter Yost. Produced by Edna Alburquerque. Co-Produced by Alex Clark. Edited by Ralph Avellino. Executive Producers for NOVA are Julia Cort and Chris Schmidt. NOVA is a production of GBH. Distributed internationally by PBS International.