John McAfee joins LooTz on CryptoCoreRadio.com in an exclusive where we have a great conversation about altcoins, bitgold, bitcoin, BitIndia, Security for users, and much more.
Lootz: Welcome to Crypto Core Radio where we talk all things Crypto!
McAfee: Alright, well thank you for inviting me.
Lootz: I just woke up myself, so I wasn’t really prepared, but, what have you been up to lately?
McAfee: Well, let’s see. I’ve been drinking mostly Scotch, and eating very little. So it’s a good diet.
Lootz: So what about your self, what have you been up to?
McAfee: So what about yourself, what have you been up to, my friend?
Lootz: I’ve eating , I eating no sugar. I’ve been on a no sugar diet. Absolutely no sugar.
Lootz: Yeah , I mean, I’m totally into Ketosis at the moment. And I feel great!
McAfee: Well good. I was on an all sugar diet, I t was a lot of fun.
Lootz: Haha, I bet it is wired fun!
Lootz: So I heard of a phone that you were coming out, did that ever come to fruition? It was a totally secure phone.
McAfee: It’s still in development. It’s a long, involved process building hardware and software for a phone. But It’s coming out early next Year.
McAfee: Basically, It’s going to be the most secure phone that’s been put together yet.
Lootz: Ok, I’m waiting for that. I thought I saw another one come out that said it was a Linux phone. Is it based on Linux, the phone?
McAfee: No, it isn’t. its based on Android.
Lootz: There was another phone I saw had come out, it was based on Linux.
Lootz: What do you think about this Bitcoin Gold?
McAfee: Well, a month ago when Bitcoin was down to almost $3,000, and people were saying “The bubble has burst”! Ignore it, whatever happens in the short term is meaningless, and it will come back. And I predict it 5 grand by the end of the year. I am certain that I will be correct in that.
People get paniced when the media or, like the chairman of JP Morgan says Bitcoin is a fraud and it will crash. So the media creates a frenzy, people start selling, but it doesn’t matter.
Lootz: Did you hear that jerk off (out there), what he said about the media? I bet you when you said that and the price started to go down he buy it
McAfee: Oh, I’m sure he did. He knows the power that he has in the press, so, but again, these things wili disappear . The more people who adobt Bitcoin as their medium of exchange or currency –the price will go up. This is simply a fact of life.
I am very confident in my prediction and you’ll see $5,00 soon. The last I checked it was $4780, what’s at right now?
Lootz: It’s $4,823
McAfee: $4,823, still goin’. Ya’ know, don’t worry about these temporary fluctuations. Even if it drops by half. That has more to do with scare tactics than it does with any sort of reality.
Lootz: About 2 – 3 years ago I was working in the corporate system , which I don’t have to anymore thank you to Bitcoin. But everybody looked at me like I had 3 heads when I mentioned Bitcoion. I was like the weirdest guy in the room.
McAfee: Well, keep in mind that the Bitcoin communinity is divided up into 2 sectors. The miners, and mining is a business. It’s not some galitarian touchy-feely thing, it’s a business. And it is competitive. There are some very large players that are controlling things. Yet the users of Bitcoin still get all the benefits of a purely distributed system.
So the miners will deal with like more efficient machines The utilities that speed up the transaction processing and so on. And the users just use the coins.
The fact that mining is competitive will create a few giants, and ya know, that’s neither here nor there. Neither will it impact the use of Bitcoin. Keep in mind, mining will disappear
Lootz: You think so?
McAfee: It’s just a few years, you know that. We will have mined all the coins. And we’ll be in significant peace. So again, there was a lot of conflict among people with Bitcoin Cash and Bitcoin Classic, I guess just regular Bitcoin
Lootz: You know The Wayback Machine right?
McAfee: Where you can go back and look at websites that have disappeared, yes.
Lootz: I was looking at that BitGPU or that BitGold website. If you go on the Wayback Machine there’s some really strange stuff going on over there. I mean they were talking about an ICO a couple months ago and then they’re talking about a premine. And then I’m thinking, how do you premine a forked coin? There’s something very strange about this BitGold, and now I’m starting to think it’s just an excuse to keep this price low.
McAfee: Oh, absolutely, absolutely. But again, these are all temporary things as well. You cannot manipulate something as it grows larger. The ability to manipulate it grows less and less. So as Bitcoin grows in users and market cap, the ability to manipulate that will disappear.
Lootz: Do you have any favorite AltCoins like NeosCoin or Komodo?
McAfee: I favor coins that give me anonymity. Like, um, Monero.
Lootz: Right, I’ve heard you say that
McAfee: Also, I cruise the DarkWeb a lot. So if you go on to the darkweb. A Year ago, everybody who was selling illegal drugs. Or, you know, contraband. Monkies from the Phillapines or what have you, were using Bitcoins. Now, everybody on the dark web is using Monero. So if that’s an indication of you what will happen in another year when Monero leaks from the dark web in-to general use. Because anonymity and privacy are Number One in my mind. And Monero gives you that.
Lootz: Mine too! I’d say that’s like the most important thing for me. I’ve looked at Monero, I kinda like Komodo a little better, even though it’s not completely developed yet.
Lootz: Monero is pseudonymous, right?
McAfee: No, no. It’s entirely anonymous. There’s simply no way to unwind the transaction
Lootz: Ok, I’ve gotta check it out. I personally haven’t looked too much into it. Theres too many coins out there to keep up with, man, it’s ridiculous
McAfee: Well, right, and many of them started these new ICOs and half of them are scams. The reason that China came down legally on ICOs and exchanges was that a number of companies, most of them coming from America and Canada were doing ICOs in China and promising things like “You’ll get 100% return in two weeks”. You know, things that you simply cannot guarantee.
People were losing money, and they would take the proceeds of the ICOs and buy fancy cars, houses, boats and party. But that would also diminish as people understand crypto-currencies better. And the more people who understand them, the fewer people you will able to fool
So what people are doing now is taking advantage of the lack of knowledge in the general population about cryptocurrencies and ICOs
Lootz: Well, what do you think of the recent ICOs going? I mean, remember back in the day there was maybe one – or two, and then every one in a while it would be something something special.
Now there’s 50 to 100 goin’ on at the same time
McAfee: Yes, absolutely. Mine will be one of those. The McAfee Coin
Lootz: Oh, really?
Macafee: Yeah, just goto macafeecoin.com. We have the whitepaper, we have everything there. And we’ve developed almost all of it already.
It’s a very unique concept, and it has to do with venture funding and how funding is decided today versus the way we will do it using the MacafeeCoin. The consensus of the users of the coin will decide what are invested in.
This makes a lot more sense than someone, yeah, let’s get invested in Monsanto’s new project for gene splicing, which scares a lot of people. I personally would not like it. And yet I’ve got no control over it.
And yet what errors develop by these emerging technologies, our children will have to live with. And we’ll have to live with if they come out soon enough. Many of them are counterproductive, they isolate people. They do nothing for humanity.
Lootz: Is this a Decentralized, ICO, type of technology thing?
McAfee: Yes, absolutely. Just go-to macafeecoin.com It’s a very long discussion, but it will fill you in. But it’s totally unique in the field of tokens and how they are used to benefit the society around you.
Lootz: Very cool, very cool… Do you have any other favorite coins? I’m on your website, it’s very nicely made, did you make your website?
McAfee: Well, India, Full disclosure. I’m one the partners on that project. And we developed a wallet that is also a distributed exchange. China shut down all their exchanges. If we had had, at that time, a wallet. Or any means of having a distributed exchange.
It’s not located anywhere, there’s no central server. But it is distributed among everyone. This is the wave of the future and provide much more power to the people. Where you’re no longer dependent on localization of things like exchanges and governments!
Lootz: I’m all about getting government out of my goddamn business. I’m all about that.
McAfee: Oh, absolutely. I’m all about getting government out, Period. Other than building roads and things of this nature, what has this government done for us? It tells us what to do, it tells us what not to do.
Lootz: Nothing, nothing! I was in a situation a couple years ago. Corporate slavery I call it, right? Where I’m making like $800 a week. It doesn’t help me pay for anything. And at the end of the week, they take 1/3 of my paycheck in taxes. Everywhere I go they’re taxing me, what I pay with the already taxed money. And I’m over there living paycheck to paycheck, barely making it. And these fuckers keep taking my money. I used to be so disgruntled that they took so much money from me, because I was almost on the street. I was on the street at one point. So it’s not fair that they take so much money from us, and they don’t tell us where they spend it. I mean, why don’t you give me an itemized bill, right? Why don’t you tell me what you’re spending my money on? Is that too hard to do?
McAfee: Well, this is the fundamental reason governments are coming down on Bitcoin, all of the Alt-Currencies. Even though the IRS and the FBI can unwind Bitcoin. If they have enough motivation. It’s not easy for them to do it, but they can find out who the sender and receiver of transactions are. But it cannot be done for things like Monero. So as cryptocurreny or tokens become more widespread because of anonymity and privacy. Governments will lose the ability to collect taxes. Because they would have no information whatsoever on what a person’s income is.
Though if you have a an offline wallet. Like Untracor or one of the other hardware wallets. And it’s hidden in a backyard under a coconut shell. There’s simply no way they’re gonna find it. They don’t have enough agents, they don’t have enough enforcement.
Lootz: Even before Bitcoin I was investing in silver and gold. That was my way to “Buck” the system, by buying silver. Like, physical silver.
McAfee: Yeah, still but whoever you buy from, if it’s a legitimate transaction. They have to log who you are and what the transaction us.
But with the alt-currencies, there simply is no way. You’d have to have an “agent” per member of the population. And that’s impossible. So this is why governments are becoming afraid, Because down the road they see themselves losing there revenue stream . If they can’t tax your income, if they cannot tax a transaction because they don’t know about it. What are they gonna do? They’d have to find some other means. Pay for use of the national parks. Charge a tiny amount for every mile that you drive on federal roads Things of this nature.
But it’s terrifying, governments. And yet there’s nothing they can possibly do to stop it. Right now China thinks “we can shut down the exchanges and ICOSs. But you can do an ICO in any country. Mexico and it’s being done in Switzerland. And we cannot sell to certain IP addresses. Like the US, or China, or somewhere else. So, that didn’t do anything to stop or halt the rise of Bitcoin. And in the future as technology becomes more advanced, and users have greater privavy, greater security, and greater anonymity. Then, what are they gonna do. Especially with things like the Bit India law. Where there is no central exchange. How do you shut down an exchange which is scattered all over the world.
Lootz: That’s needed. That’s needed so badly right now. Especially with the doxxing going on. Now they’re auditing, they’re auditing Bittrex right, so Bittrex is kicking coins out of the exchange because they’re giving dividends or they’re burning their own coins. And in the government’s eyes, that’s a no no, right? So decentralized exchanges are very important.
How does BitIndia work? On the backend? I mean, not to go into too much depth, but…
McAfee: There really Is no backend, it really Is a totally distributed system. There Is no central server located anywhere. So there is no backend. The intelligence of the system resides in the distributed nature of the processing. Where every person has their own wallet and processes a piece of every exchange. So it’s a profoundly new concept. How we did it, I’m not likely to tell you today because (the) technology is the value here. This is still a business, we have to keep in mind that this is a business. If it weren’t a business, we wouldn’t have much innovation. This is a fact.
Lootz: Yeah, there are a lot of copycats out there who will just copy your code and claim it as their own, I understand.
Lootz: So do you have any advice you can give my followers. I don’t have a big following, I have about 900 crypto fanatics following me. So yeah, my followers are fully “Crypto Heads”. But any advice you could give them to keep their wallets safe?’
McAfee: Yeah, absolutely - #1, DO NOT keep your wallet on a computer, a laptop, a pad, or your phone phone – because eventually it will be hacked. I promise you. It doesn’t matter how much funds you have, the largest percentage should be offline at all times on some sort of hardware wallet. There are a number of them out them out there now. Ledger has one, Trezor has a number of them. Pick one, use that, unplug it, and you’ll probably be safe. When I say probably, hackers are very clever. And they’re usually a step ahead of everyone else. But I guarantee you. I don’t care how secure someone says their wallet is. If it resides on your phone for example, it’s not secure. If it’s all encrypted, here’s the problem. Hackers can place keystroke loggers and screen captures. So that when you’re in inputting your seed keys for example, the hacker then has your seed keys. So, I don’t care how much encryption you use. If the software is able to see your input prior to being encrypted, what use is encryption?
Lootz: Well, what software do you recommend since McAfee’s not the one we should go with completely?
McAfee: What software? I don’t know, I favor the Mycelium wallet. But I don’ I don’t know why. For a software wallet it’s reasonably secure.
Lootz: How about Firewalls, I use Spy Shelter.
McAfee: Which one?
Lootz: Spy Shelter? It encrypts your keystrokes. Its features are pretty in-depth, if you check it out, it’s called Spy Shelter. It doesn’t let anything get stuck in your clipboard.
McAfee: But see, they get it. It doesn’t even matter. If every keystroke you type is first intercepted by a hacker, then it doesn’t matter what else you do. It has to be typed. And the hacker places in front of all the other software, its own piece – which filters it. You just typed an “A” or “B.I.T.C.O.I.N”, ah this must be a wallet. So trust me, there’s nothing you can do. I mean, my entire life, I’ve dedicated to cyber-security. And I know as well as anyone in the world of software.
Lootz: I’m really excited. I’m really excited to be talking to you right now, and it’s really cool. You’ve been like a hero of mine for a long time. Ever since I watched those videos of you in your pimp outfit
McAfee: That was about 3 years ago.
Lootz: That was great man, I loved it! I listened to your on your other shos as well.
McAfee: That’s when Intel decided to sue me. Because Intel had purchased McAfee by then. Yeah, so. I just settled that lawsuit about 3 months ago.
Lootz: What’s your opinion on proof of stake? In proof of stake you can’t turn off your wallet if you’re staking.
McAfee: I understand Proof of Stake, it sucks up far less electricity. But Proof of Work, I’m sorry, that’s just the way it has to be.
Lootz: And you can see in the price. There hasn’t been a proof of stake coin out there that has done well out there.
McAfee: And they won’t.
Lootz: Have you looked into things like Steemit, you know where they have these decentralized blogs?
McAfee: Yeah, people send me a lot of Steemit posts, mostly about the stuff I’m doing. But I’m really not involved in the Steemit community.
Lootz: I still see the problem with the DNS. If the government wants to shut them down, they could just shut down Steemit.vom So it’s not really decentralized, is it?
McAfee: Yeah, anything centralized can be shut down at any time. In any number of ways. Which is why decentralization is the way to go. It’s the only way to give power back to the people, and away from the power brokers.
Lootz: Gotcha. I’m really interested in the hard drive coins too like FileCoin.
McAfee: Maybe FileCoin, what was the other one?
Lootz: IPFS, It’s a planetary file system. What do you think about that one? Oh, it’s not a coin, it’s a protocol like TCP/IP
McAfee: Right, I understand totally. To be quite frank, I haven’t dug into it. I’ve been spending so much time reading whitepapers for ICOs. I’ve probably read 800 of them in the past 6 moths
Lootz: Ya know, I work for coregroup.info and these ICOs are a dime a dozen, and we’re rejecting them because a lot of them sound like scams to us.
McAfee: Yeah, but so many of them are also fascinating and hold great promise. One company I’m working with is KWHCoin, the kilowatt coin. It’s designed for people who are either fully off the grid or partially. Where they have either hydroelectric, solar or wind power, or what have you. And the problem with these things is that your generating constant amount of electricity. Or whatever electricity the sun will provide or the water will supply. And frequently it’s more than you need, and other times it’s less than you need. Wouldn’t it be great if there were a token, where I’m living in Arizona and someone’s living in Vermont. I’ve got excess power, they need power. We could exchange tokens. And they could be used in any kind of way. They will use those tokens then to buy power from someone close to them.
It’s a tremendous idea, and the facilities are already there. Even in 3rd world countries; I was in Belize. If I wanted I was running my generator. My excess power would go back on the grid, if I had excess power I would paid for that, or even my bill would be reduced. So it’s a very trivial thing to be implemented from a hardware standpoint But that idea captivated me
Lootz: I’ve seen a lot of coins like that. I think was one called Earthtoken or something similar
What’s your opinion on Tokens and actual blockchains, I mean, any Waves, NXT?
McAfee: I think it’s a trememdously good idea. I mean, come on. The blockchain is infinitely flexible. It’s also infinitely secure. And it’s the only ledger system that’s absolutely solid. Can’t changed once, once you’ve made a transaction; once you’ve made a transaction, that’s it. It gets folded into every other transaction that’s happening at the time. You know, once the hash is complete, you cannot unwind it. So it’s secure, completely.
These two things, the flexibility and the security make it an extraordinarily powerful tool, so I’m all for that. Tokenize everything!
Lootz: Ok! Haha. I kind of like the idea of having an original chain, ya know, as compared to having a token because if something happens to let’s say the Waves Platform right? You know, Their mother chain. That’ll kind of cripple everything on their chain, right?
So I would rather go back to the old days when people actually built the chain themselves and made a coin, made a real proof of work coin. Something real instead of these tokens. Which, you know I like tokens, but could the damage that could be done when there’s like 5,000 tokens on one of these platforms?
McAfee: Well, yes I can. And it should not be done on a platform which is absolutely rock solid, or is not dependable. And that is very difficult in software, but not impossible. So, these things will eventually shake themselves out. Those things that are shaky will collapse, and that’s a problem. Nevertheless, it’s the reality (of the situation). But eventually, we will come up with things that are totally reliable and hopefully (be able to) distribute it. You can distribute anything if you think about it.
That’s what people are doing now, that are illegally mining Bitcoin using pieces of software and run in the background of their phone or their laptop. And this is while (machine) is not doing real work, will use those excess cycles to mine Bitcoin. But it’s spread out over thousands different computers, 10s of thousands.
So, I kind of believe in reinvesting in whenever I invest in Bitcoin, I reinvest in the technology again. I may look crazy again in everybody’s eyes, but ya know – I’ve been there before. They can call me crazy, buy in 10 years when SIA coin or maybe any one of these hard drive coins does great they’re gonna be like “Aw man, I should have followed you”.
McAfee: Basically, when you said “should have bought Bitcoin at 50 cents’, right? So, Absolutely!
Lootz: Cool, man. So you don’t recommend any software I guess like as far as firewalls are concerned?
McAfee: Not for a wallet. And I know people who keep Hundreds of Thousands of Dollars in Bitcoin on a phone. Now, eventually that’s just gonna disappear. When hackers get sophisticated enough to plant software of what would be the equivalent of what you see as a flashlight app. Everybody downloaded them, and everyone had malware. So when hackers gets sophisticated enough, they’ll activate their software. And their software will say I’ve got $2,000 on this phone, and I’ve got $50,000 on this phone. They’ll get the low hanging fruit first. So the more money you have in a software wallet, the more likely you’ll be to lose it.
Lootz: I personally have a few proof of stake coins that I watch, so that’s my problem with it. I’m trying to find more protections to secure my atmost coins. There’s a few little junk coins that I like to stake, yaknow?
Lootz: What’s this thing with Jamie Diamond you were talking about?
McAfee: Jamie Diamond, CEO of JP Morgan. Came out, he did a rant about how Bitcoin is a fraud. It was based on nothing, and it would collapse and disappear.
McAfee: So I went on CNN’s Fast Money and countered that Bitcoin is at least based on a piece of work. I’m one of the largest miners in America. We’re running almost 2000 machines. 2000 of the Bitmain S9s. And I know exactly what it costs (to make) 1 Bitcoin. And right now it’s over $1,000. So at least we have proof of something. But what’s the dollar based on? The value of the paper it’s printed on. So which one is the fraud? Clearly, there is no value to the US Dollar that you can point to and say “Here, here is the value”! It’s all based on faith. And bitcoin too is based on faith too, but each coin required a huge amount of processing, electricity, facilities and management in order to create. So surely there has to be some value to that work.
Banks can’t compete with alternatives. It’s easy. So what is happening, is the “product” that banks sell, Is now being done by Bitcoin for example, In a distributed way. Where every person is their own bank. You store your money in your bank. You would write checks, or the equivalent by performing a transfer of funds. It’s simply too easy. So banks are terrified, they see what’s coming. And the head of the IMF said Banks would disappear, within a few years.
Lootz: I closed my back account about 3 months ago and I never looked back.
McAfee: Yeah, see, you are your own bank. So this is why Jamie Demon is freaking out. Because he sees his bank, one of the biggest businesses in America, as being completely marginalized. Like the equivalent of the buggy whips, which was big business when people road horses. But the automobile industry came along and horses were still with us but certainly not in the ubiquitous nature they were before. And banks will be in the same position, they are the buggy whips of this generation.
Lootz: I was over by like 50 Cents (at my bank) and they gave me this $40 overdraft fee and I freaked out. Close my account, I don’t wanna deal with this anymore.
McAfee: Well listen. I’m running out of time, my friend, so let’s have one more question.
Lootz: Alright, are cryptocurrencies viable for payment without buyer protection?
McAfee: Well, first off all. What is buyer protection? Have you ever purchased anything that went south on you where you received your full money back or a new product? It’s really a rare thing. And whatever the warranty says, try to exercise that warranty. To me it’s really a trivial issue. What is buyer protection? You are not going to get the product, that is it’s a scam.
But this is what happens now anyway. Even on Amazon. Not on Amazon itself, but sort of the partners. There are scammers among that crowd. So that will always be with is.
So buyer protection, I would say “Buyer Beware”. This is the way it’s always been. It’s your job to figure out where the person you’re something buying from is a legitimate retailer or seller. So we have many ways of testing that. Ratings for example: Where people who’ve bought from them and prove that they bought from them. Can say “I never got the product from them”, well, if they didn’t get it, you’re probably not going to get it either! use somebody else! Buy from another dealer!