The Breakdown - The Mass Surveillance Machine, Feat. Maya Zehavi

Episode Date: April 29, 2020

As the COVID-19 crisis rages, it takes on new economic and political dimensions. The frames for many of the most important questions for the next decade are being set now, in this moment.  On this episode of The Breakdown, NLW is joined by Maya Zehavi, a long-time blockchain consultant known for her insightful domain-spanning takes.  They discuss:  How the COVID-19 health crisis overlapped with a political crisis in Zehavi’s home country of Israel  Why governments use times of crisis to take extraordinary powers How contact tracing apps have become a battleground for mass surveillance  Why the shift to localism from globalism creates new challenges  How the problems distributing stimulus are shaping the conversation around central bank digital currencies

Welcome back to The Breakdown, an everyday analysis breaking down the most important stories in Bitcoin, crypto, and beyond, with your host, NLW. The Breakdown is distributed by CoinDesk. Welcome back to The Breakdown. It is Tuesday, April 28th, and today we're exploring a theme which has been recurrent on this show, which is the idea that this coronavirus crisis intersects not just health, but economic and even political. issues. My guest today is Maya Zahavi. Maya has been in the blockchain space since 2014. She is an itinerant consultant who's worked on a number of different projects. But I got to know Maya when I started noticing these brilliant tweets just consistently coming out of this person's account. And so I've followed her for the last couple years. I've watched her observations across a huge number of issues

and really think that she has a unique synthesizer-type perspective. I wanted to bring on Maya, generally because I think she's incredibly smart and has a great perspective, but specifically because Israel, her home country, has served as something of an interesting case study of the overlapping of political crisis with this exogenous health crisis, with serious questions of surveillance. The Israeli apparatus took extraordinary power to surveil citizens that was just unwound by the Supreme Court there, and I think it makes for a very interesting case study and microcosm of the debate going on around contact tracing the world over. We talk about that, but we also get into larger geopolitical issues, how the COVID crisis is or isn't reorienting

countries like Israel vis-a-vis their relationship with China or the relationship with Europe or with the U.S. We talk about the question of domestic supply chains and how people might shift to localism instead of globalism and what the risks in that might be, but also some of the inevitabilities. We talk about Libra and Decept, the Chinese digital currencies, and about what the role of digital currencies is in this post-COVID-19 context. So it's a really interesting conversation. I hope you enjoy it. And with that, let's dive in. As always, quick caveat, when we do long interviews like this, we edit them extremely lightly to keep it as close to the original conversation as possible. All right, I am here with Maya Zahavi Maya. How are you? Good. How are you?

Good. Thank you so much for joining. So I feel like I met you on Twitter basically through noticing over and over and over again that this person that I hadn't interacted with or didn't know anything about was having these like incredibly insightful thoughts on a variety of topics. So my first introduction to you was like a crypto Twitter polymath that quickly became not just about crypto Twitter. But for those of you or for those people who aren't familiar with you or your Twitter, what is your background? What do you spend your time on? Mostly since about 2014 full time in blockchain, mostly emphasis on enterprise blockchain. So I kind of got into this industry really, really early.

My background is in finance and fintech, but I guess, but for the context of this, or how I think of it, I started my career in the Israeli IDF as a SIGN analyst. And that kind of, you know, looking back, that kind of positioned me to connect a lot of different dots throughout finance, technology, and politics in general, I guess. Yeah, you definitely kind of come at the world, it seems, again, just going from your Twitter from this very, synthesizer kind of point of view, right? Like at any given moment, a tweet might be about current geopolitics. It might be about technology. It might be about blockchain specifically. And it feels to me like they all are kind of weaving their way in and out as part of the

same story for you, which I think is super relevant for our conversation about coronavirus and the world produced by coronavirus, right? Yeah. So that's true in many ways. I think in some regard, the story really starts. me in 2008. At the time I was at warden and I thought I had the lecturer of having a front seat, a front row seat to hear the greatest minds explain to me what the hell went wrong. And nobody wanted to talk about it. And the more I started delving into that and doing

recruiting in tech that time, I realized that there's a complete failure in terms of how disconnected finance and the economy are. And that's really when identity and Facebook and the ad market started to be this big red light of like, beware, this is coming at you. And then I, well, I discovered Bitcoin in New York in 2010, but I really went down the rabbit hole at the end of 2013. And then I realized that blockchain on the surface, and this is at the time, there was only Bitcoin, had the potential to be a backbone of identity and data in general, not just a value of cryptocurrency. So it's interesting.

This question of identity is it's almost like the background noise lurking on a lot of our conversations, it feels like, right? It underpins questions about data and personal. identifiable information. It underpins, you know, there's so many pieces of the modern story that come back to this question of identity or, you know, data that identifies that is specifically tied to some person. And it's really interesting. So part of why I wanted to have you on the show is Israel has had, it's gone through basically a full cycle of its relationship with a COVID tracing surveillance mechanism, right, or a contact tracing surveillance mechanism. Yeah, well, well, at least

of a complete cycle compared to everyone else, right, who's still dithering and trying to figure out what the hell they're going to do. And I noticed a tweet from, I guess, last week or maybe it was the weekend that I thought was really apropos. You said, we built a surveillance apparatus in the West for ad optimization, and now it's slowly being converted for COVID. It's going to get a lot more difficult dismantling that after countries start relying on that apparatus. So I guess maybe as a way to kick off the conversation, tell me a little bit about, add some more content. context of that tweet, and then maybe we can go into, you know, what has been happening in Israel around the surveillance mechanism between, you know, the middle of March and now.

So I think actually the story kind of starts in February for Israel and Corona. And the reason it starts February is because the Corona story and Israeli politics go hand in hand in the whole way the government has come at it and civil society has fought back. So around middle, of February, Israel decided that it's basically locking down the flights from China. And I think they were the first country to decide that they're not letting people come in. But on the other side of that, you also have to remember that there was an election on the first week of March. And despite the fact that the Israeli Ministry of Health was very fast to close down the country, the minute it got serious and we entered into real lockdown, the politics of this situation

post the election, which again, this is just a bit of a background. Israel has gone to the polls right now three times in the last year and a half, and the prime minister, B. Netanyahu has failed to form a coalition government every single time. And right before the mandate to who is going to form the new government after the government after the third election was done, they decided to lock down Israel. And it literally happened within 24 hours. Emergency orders were sent in motion. And as part of that, they decided that the Sheenbit, which is like the Israeli FBI,

is going to be collecting all data under a special order in order to be able to, for contact tracing, and to make sure that they can enforce through GPS that the people who were told to quarantine are going to quarantine. And it was, I mean, you have to understand the mindset. They went full paranoid, worst case scenario. The whole country is built for a doomsday. And this is what we're putting into action. But at the same time, the elections, right, they were supposed to reopen parliament.

And as part of the emergency orders, they decided that they're stopping the judiciary and that the Speaker of the Knesset won't reopen Knesset. So suddenly, in the middle of a political mess, you have everyone locked in at home. No one can go and demonstrate. They're not opening the Knesset, and they're telling us that the Sheenbed is following everything that we're doing just so we can keep safe, right? So the backlash was instant. And there were demonstrations literally the next day where people got in their car and drove to Jerusalem. and got stopped by police that were under orders to not let people go on the highway,

drive on the highways. And then for them not to enter the Knesset. And then they ended up arresting some very senior national security people because they dare demonstrate that the parliament has to open the Knesset. So that's where we started with draconian surveillance laws of like we just need to get this under control. And throughout the next seven weeks, I think the emergency orders were under a temporary, they had a time limit and they had to be renewed by the Supreme Court. And the Supreme Court started pushing back and not giving them a carte blanche to just renew and do anything. And over the last week, the Supreme Court has ruled that the police can't use surveillance in order or GPS to find the people who are violating your quarantine.

orders and the other day they said that they're not going to renew the Sheenbet surveillance orders at all unless they go through main legislation of a parliament. Interesting. So it feels like there's like three at least different things going on here. One is there's the way that an exogenous crisis superimposes itself on a current political crisis, right? So that sets the context for any action. The second is, is the question of extraordinary powers, even holding aside that context, right? What is and isn't appropriate for a government to do, which is basically the question that I think every government is wrestling with right now in some ways.

Or citizens of every government are wrestling with. And then third is efficacy. I noticed another tweet of yours that said something like, Israel just pulled back the blanket location surveillance of quarantine COVID contacts. After almost a month, the police successfully used the entire surveillance apparatus at their disposal to track three patients, left their quarantine. So you have these like three very different things, all of which it seems to me

are worth being frustrated or at least having some serious questions about, right? Yeah. I just add one thing that I think is the basic premise to the situation. And that is that a lot of people don't trust the government to actually take care and manage the situation. and it seems more like a political excuse for the negotiations, the coalition negotiations. And instead of putting in motion all the protocols that were put in place ahead of time for exactly these kinds of situations, it's been handed over to bureaucrats and budget people who don't have that much experience with technology or operations, and definitely don't necessarily know how to coordinate with the private sector.

So that was also like a big shadow of how Israel dealt with us. And that goes to the, you know, we had fake news from the Ministry of Health on a daily basis. Yeah. But wait, before I say that, I will say something good. Yeah, yeah. They have been in Night and I, and it's amazing to see compared to other countries, the amount of data that Israeli geeks demanded from the minister, Ministry of Health is like insane. They have a JSON file and a CVS and you can download it and like,

you know, people were asking, we want this little segmentation. How many new patients are you testing every day? And then they publish that. You know, I mean, they really have been transparent on the data. I'll give them that. Yeah, it's, it is interesting. Like, part of what I think makes Israel such a fascinating case study in this is it's this relatively contained place that has a very unique context, but also it has, you know, one of the most, arguably the most technologically literate populations in the world, right? You mean, you pointed this out in another tweet. You said, the state of Israel, also known as cyber nation with some of the best known computer scientists and cryptographers, today submitted a report to the Knesset's Intelligence Committee that the best

contact tracing solution they can come up with is to hand all our data to the NSO. And so there's this, it doesn't surprise me, I guess, that there is this, the pushback is more, is more intense and also more specific, right, in Israel than in other places, because it's a population that actually has the tools to be specific with their critique in some ways. We also have a lot of civil society and institutions that have held firm as the guardians of democracy. And don't forget that the judiciary in Israel is very well-known. both academically and in practice as being one of, as a very activist court, which is a lot of the critique against it, right? And I think it all goes back to like what Israel is and also how he was

built. So Israel for 70 something today is and tomorrow's Independence Day. So for 70 something years, Israel, I'm laughing because I don't remember how many. Israel has looked to the West, right? It was built as a democracy. It wanted to be a Western country. And over the last couple of years, we've looked at Asia, right? If progress is in Asia, if the market is in China, and we were also looking eastward. And you can see that there's a very distinct split in how countries have reacted. You've got Europe, the U.S., and Asia. And Israel has had the opportunity to come out of COVID like Singapore or Taiwan because we're islands, because we're small, because we already have a very resilient food supply chain domestically,

because we have a national logistical operations that the army can do in case of emergency because we know how to improvise and we know how to build fast and so forth. And looking at how we've reacted, it's literally like we left the bureaucrats who are busy sucking up for their next job to lead the operation without them knowing what they necessarily have to do. So that's really where the privacy issue, I think, entered. But I also have to say that the Ministry of Health has also been very conscious of privacy issues and that was a different problem that they had that they wouldn't share data with other

government offices in order not to breach any privacy laws. I'm sorry, I went on a tangent there. No, I think it's super interesting. I guess a follow up to that is kind of from this standpoint of being in a place to view these other kind of spheres of influence, right? You know, America and the West, Europe and China and Asia. how do you think the COVID crisis or the ongoing response to it is recalibrating how Israel thinks about those other places in terms of, you know, not just model emulation, but who they want to do business with, how they want to design the economy? I think most of the world for the first two weeks was waiting for the U.S. to get their shit together and be Uncle Sam that's going to come and rescue everyone.

And then we realize that's not going to happen. And that's not specifically Israel. That's everyone, right? Because every country had to deal with the same issues of the testing and the supply chain and contact tracing and respirators and PPE and so forth. I think Israel has been known to deal to like help itself when it has to, right? When we're up against the wall, we improvise and we get ourselves out of whatever shit is happening. On the other hand, what stands out is how prominent China is both in terms of supplies, that you have private jets that went to Shanghai and Beijing and brought in testing kits

and PTE and masks and so forth. But there's also in corporate public-private partnerships, right? So we have a new testing lab here that's going to open next week that My Heritage and BGI, Chinese company, have built that is supposed to expand our testing capacity. And the whole negotiation was very, was stalled for a long time because of privacy issues again, that they didn't want either My Heritage or BGI to have any access to the personal data or to the genetic data. So you just everywhere we, we start dealing with one issue, geopolitics keeps on coming up. Yeah. Where do you think, and this is all speculation. And just for anyone listening, by the way, the purpose of these conversations is to get lots of opinions and perspectives, right?

It doesn't, these are like we're not claiming expertise here necessarily. It's all subjective because I think everyone's trying to piece it through. But, you know, one of the things that I've been trying to figure out is what the, what the, what the, realignment looks like after. So in America, there are a couple things that stand out as obvious shifts that are coming out of this. One is questions of supply chains as security issues. That's something that has, I think, come home to roost in a big way. And it's kind of bipartisan, right? I think that you see a lot of folks who were, you know, pure globalist kind of mindsets before saying like, hey, maybe we should be able to manufacture drugs here, right? Like, why are there

still testing shortages. This seems insane. And I think that that's going to have a big impact on American geopolitics and American industry, right? Are there other effects like that that you're seeing either in Israel or in kind of immediate like partners that that you think will be byproducts of this conflict or second order effects of it? Yeah. So I have this like running theory that and this is kind of maybe in response to the interesting article that you're seeing which countries have a tech debt and which don't. And by that, I mean, which countries didn't invest in IT infrastructure that can be scaled up fast and can connect to a lot of different entities.

And I think the fact that it takes so long for the SBA loans to come in in the U.S., whereas people in Germany got their money within less than 48 hours is going to have a very direct impact as to how fast these countries are going to get out of this crisis. And that's going to play out, that's going to affect how strong the dollar is going to remain. Because if Europe's going to get out with their consumer demand increasing a lot faster than the U.S., then maybe the dollar won't remain that strong long term. So that's one thing I'm really looking at. And then what's interesting to see is how do the different government entities share data

and what it is that they're really managing? Because it shows you a lot about the social security system and the social net and the welfare system that those governments have put in place. So in Europe, where you do have a lot of bureaucrats in charge, you know what? they did their job and it works right people got the money from the government fast loans were approved as they had fintechs and pstd2 to access that they knew exactly where their privacy uh red line is and they were able to have a very um i thought informative and substantive debate about that um whereas

you see countries where it's not the top of the priority and people aren't discussing who are doing those benefits. It's interesting. This idea of tech debt, I think it's fascinated to take that as a frame of reference for what's going on in the U.S. vis-a-vis bailouts, right? Because so I've had a few guests on who have argued over the last few weeks that we were, we've been in a situation in the U.S. where effectively there's no, there's no more buyer of U.S. debt in the world other than the Fed.

And so we were always going to come to this point where the Fed just had to backstop everything. And especially in the wake of 2008, and especially in the wake of like GM getting bailouts, that all of the corporate sector basically was looking over and saying, well, something bad happens. Of course, you know, why I get a bailout too. And I think that you can be really concerned about the knock-on effects of this while also kind of seeing the inevitability of it once the train has left the state. of the Fed backstopping everything and going to unlimited QE. But going back to your point about tech debt, one of the interesting ways that that has played out

is that in the context of being unable to efficiently distribute whatever that support is, you actually have the interesting impact of keeping people more reliant on you, because instead of people getting back to normal industry and whatever it is that they're doing, they're just kind of waiting endlessly on a bureaucratic process, which only serves to reinforce the dependency that they have, which I think is a fascinating kind of unintended or hopefully unintended consequence.

Yeah, but I'm also thinking about how fast they get the money and how that's going to impact their personal finance. You have to remember that 6% of the U.S. economy is consumer-based, right? The amount of consumer debt has spiked is like almost at the highest, it's been since 2008. The corporate leverage loan is really high. So what's interesting about the tech debt is that the government knows how to give money to the corporates. It doesn't know how to distribute the money to small businesses and directly to people.

So what you have is a disconnect that's becoming more and more jarring between the financial markets and the real economy. and because the Fed is just pumping all that money. And we don't necessarily know where every new U.S. dollars more effective long term. Is it to give it for people to pay their rent or is it to put more money into the repo markets or maybe buy some corporate debts? It feels like they're trying a lot of different tools at the same time. going to eventually just keep on having the U.S. Treasury as the lender of last resort. And that's okay. I think for now. Yeah. So this is a super loaded and ridiculous question. So I apologize

in advance. But as a representative of the world looking in, right, or at least, you know, one part of the world looking in, what is your perception of how people are looking at the Fed intervention in the markets? I guess for an informed audience, right, for people who are paying attention, Is it seen as something that's like, well, that's just what you have to do right now? Or are there questions of what are the knock-on effects to the dollar? What are the impacts for the world economy that relies on the U.S.? You mean outside the crypto circle? Yeah, exactly, yeah.

I think people understand that the U.S. had no other option and that they were very fast to act this time. And they made it very clear that they see their mandate as a blank check. They're going to pump whatever money they need to make sure that the market works. And the byproduct of that is that the dollar is very strong, whereas different other foreign exchanges have fallen. And I think we're going to see more and more defaults. Lebanon today, I saw that there were some riots there. I mean, in the backdrop of Corona and everything, they also defaulted on their loans, right? So we might see more emerging economies in that circle.

I think the credit risk in the MSCI and the emerging markets is going to spike again. I don't know if you remember there used to be this thing called the brick. And if you look at where the brick is Brazil, Russia, India, and China. And if you look where they are right now, it's not necessarily the place you want to invest in. When I talk to investors right now, most of them are just long, very few and specific assets, and the rest they're keeping it to cash. Because it just seems like we haven't bottomed yet. And at the beginning of this, it was very obvious to me that this was going to be both the demand talk and supply shock. And I looked how long on average it took the market to bottom.

And it's usually more than a year. It took us about almost 500 days in 2008. Now, considering that we live our life on speed right now, right? It still doesn't seem like we've reached the bottom. It seems like it's just like this very optimistic exuberance that's pushing the markets up and the Fed. But at some times we're going to see earnings. We're going to see the revenues.

We're going to see how many people are actually on the payroll. and I don't see how the market can retain its current prices. So speaking of this kind of back-to-back supply and demand shock, you tweeted, we need to start defending digital globalism before rapid de-globalization becomes the third shock to our economy. What did you mean by that? I think de-globalization already started a lot before Corona ever met that bat. But just like we were talking about earlier, the first thing, when a government sees the economic impact of people being under lockdown and understand that they need to send for themselves. And one, and two, they need to make sure that they have a resilient domestic supply to them so that if they lock down, they don't have to get on the phone and beg China to let them have some masks, right?

or some active ingredients for their drugs. So countries are going to make sure that the next stimulus money that comes out of their treasury is designated to build up the domestic supply chain and the domestic economy. I mean, why would you buy something foreign if you can buy USA and with that support the meatpacking industry, right? because it's going to be for the benefit of everyone if they survive. And I see that impulse starting to gain grounds. Don't forget that Europe, Germany and the beginning didn't even wasn't willing to release any of the supplies for Italy initially. So that's one side of it. The other side is I just don't think that we're going to be able to overcome Corona without a global coordination process.

And I think Corona also highlighted how hollow some of these international organizations like the WEF or the G20 are. Because the fact of the matter is that we ended up for a couple of weeks with the black market of PPE, instead of having a real system of how can we optimize the global supply chain. So I think there's a dance there between the two that different governments are trying to figure out and alliances might change, right? Yeah, I think it's a really salient point that there's going to be competing forces for some time. And this might be actually kind of a defining economic and political factor of the next decade, which is, on the one hand, this return to kind of local national thinking or even more acute localism in the case of the U.S., which we're experiencing now, certainly, while also needing to not throw the baby out with the bathwater of these abilities to coordinate when situations require it, right?

Which is certainly in the case of something like a pandemic. That's a great example. Yeah, but you also see it in the policies. Like there was, I don't remember which bank it was, but several, I think it was JP Morgan, but I could be wrong. Several multinational American banks have decided that they're reducing the credit to European companies. Why? Because they'd rather have their balance sheet full of loans to American companies if they're going to get another stimulus or if they're going to need some more liquidity from the U.S. government, right? it's just going to look good. It's more patriotic. So I think that's a trend that we're just in the beginning of that. But it'll be interesting. That's for sure. Yeah, I think you're right. And

speaking of policies on the fact, you know, Japan in one of its stimulus bills actually put in incentives for companies to repatriate from China, you know? They were basically like, if you come back from China to Japan, you'll get X amount of additional resources or whatever. And I think that's something that you're going to see pretty significantly incentivized, certainly in the U.S. too, you know. I don't think we'll see mandating it. But it's not sustainable. That's another thing. Like, let's be honest, right? We're not, like, the U.S. can compete with Bangladesh for, like, apparel. For some electronics, the U.S. can compete with Vietnam or Mexico. It's like it's too big and the salary gaps are just too significant for the U.S. to be able to fund everything.

So that's something that I'm actually, I actually think a lot of the global supply chain will remain where it is, but it might. But just the essential stuff that we need for the lockdown would probably be repatriated. But I could be wrong on that. Yeah, I think it's, no, I think it's an interesting, it's an interesting nuance. take to this where right now everyone's like, holy shit, supply chains, localism and stuff. But really, there's a huge difference between, I mean, everything will involve some amount of consumer behavior shift likely, right? Like, if you bring, I mean, people have been trying to figure out how much it would cost to build an iPhone in the U.S. currently, right? Obviously, that would change if the system was

reoptimized for it. But it's a huge, huge amount more, obviously, than the, you know, $700 or $1,000 or whatever that people pay for it now. And it may be, that where groups land, where places land, is that there are certain things that have now moved over and fallen under the banner of security, right? So, you know, reagents for drug tests and things like that. Whereas other things are fine, you know, these are whatever, these are consumer goods that they don't care about as much. But it'll be weird to see. I don't think anyone quite knows exactly, but there will be some pretty interesting pressures on that going forward. For sure. So anecdotally, we in Israel, we already have a domestic manufacturer for swabs,

and they're trying to find an alternative for the Chinese reagents for the testing. So they moved really fast on those things domestically. But I also think the other side of the domestic is going to be CBDC. Like there's no way, if you're going to print money and you want people to buy locally and you want to encourage the local economy, the domestic economy, there's no way you're not going to be, you're not going to, sorry, one of your requirements is going to be able to, is going to be to track every single purchase and make sure that this money was used for domestic products. So that's a linkage that I thought will be, um, um, broadened going forward in, in the West and CBDC. Yeah, well, it's, it's interesting. You literally

actually guessed at the next thing I was going to ask you about because, you know, before we were talking about the difficulty that the U.S. has had distributing stimulus. And at one point, one of the proposals during the stimulus debates was, it was from Pelosi, included a digital dollar. Now, it was, you know, kind of half-baked from a previously proposed plan from a bunch of academics, and it triggered a huge amount of questions about, you know, there's obviously a huge number of issues that have not been resolved in the U.S. vis-a-vis the relationship between commercial and central banks and consumers and all this sort of stuff. But it was fascinating that it showed up there.

Now, simultaneously, we've seen, you know, China step up its push for the DSEP. You know, over the last couple weeks, we've seen a bunch of new announcements around the National Blockchain Coalition and the National Blockchain Service Network, the blockchain service network. We've also seen these first screenshots of apps for actually interacting with and testing the digital currency. How are you, do you think that this, the COVID crisis is going to be a catalytic force for governments as it relates to digital currencies? I think it's a huge catalyst for surveillance.

Suddenly everyone wants surveillance and you have the biggest privacy advocates around the world saying, hey, maybe we do need this. So I think that is going to be the driving force in the West. But the CBDC, from my conversation with the central bankers, both in Europe and in the U.S., it doesn't necessarily function the way we, or our necessities aren't necessarily the same as China. What do I mean by that? From how I understand the BSN, the blockchain service network, is essentially across banks, settlement network for data and digital value. But at the same time, you can say that an RTGS system, which is real-time growth settlement system, as modern economies have, basically serves the same function, only it's open

just to banks and some fintechs, right? So the nuance of what it is that makes it a blockchain or digital or consensus becomes much more significant on one hand to make sure that you're not in buzzword salad air zones. On the other hand, there is a need, and we've seen this with Corona,

to have a data network, an identity network, so that we can transfer data about either our finances, personally, in terms of retail, not a wholesale solution, so that we can communicate information about

people's identity, about their commerce, about their actual assets without necessarily disclosing everything. And I think that nuance is going to be much more specific as we go forward with the CBDC. It feels amazing how kind of far behind that conversation we are in the US relative to the rest of the world in some ways. But I was going to say, I don't think the U.S. is that far behind because you can say the Libra was going to be the private enterprise solution to resolve that, right? That's how Facebook basically positioned themselves. It's either the Chinese Communist Party or it's just. So I think that drove a lot of the conversation in the U.S.

And there's been a lot of catching up in terms of central bank digital currencies across. American regulators and banks, in my view. Yeah, that's a fair point. What did you think of Libra's recent announcement, which felt kind of inevitable, but this shift from this basket of currencies model to a group of individually fiat-pegged staple coins? Where to begin?

Obviously, we all realize now that the use base is not the altruistic banked, the unbanked, that they initially pointed to. I think it's an obvious step. They realize that they needed regulation, and they've responded to a lot of those issues, not all of them. And the fact that it's commissioned and not permissionless

and that there's going to be full regulation on every end basically doesn't make it that compelling on one hand. On the other hand, how many governments right now want to network where they know that all their citizens can just sign up and they can get money helicoptered directly to them. So it's a give and take. I don't think a Facebook initiative should be the backbone of any network going forward. Let's put it this way.

And that's my own bias and my prejudice against the Facebook. machine. Yeah. I mean, I don't think that bias comes unwarranted and certainly you're not alone in that feeling. But it is interesting to see this shift from, I think that you're right, right? We went from Bank the Unbank to let us do this because if you don't China will to, all right, central banks, you're ready for those digital currencies? We got you. We're the consultant on this one, you know? Yeah. And we get to decide who that value-added services are. And we get to decide who the wallets. And you know what? Maybe we'll do the KYC.

I mean, in some ways, initially, Libra was genius. Why? Because you realized that Facebook needed to be able to close the loop on the actual purchases for their ad optimization, right? And instead of saying, hey, we're going to go in and get an e-money license or start a payment network, because they failed in their previous attempt to do that. they said you know what because of antitrust because of privacy we're just going to outsource everything to other partners and then we can say it's not us so they you know they just pushed out accountability to other to who was it and initially PayPal and Uber and it was like I can't fault them for that it was pretty brilliant but it seems to me that in the current form they actually actually

have to contend with regulations no matter where they fit in the different stack of Libra. And that's a net positive. Interesting. Well, I really appreciate you taking some time to give your perspective, to share this case study of Israel, to just talk through so many different aspects of what's going on right now. But I'd love to leave on a question that I've been asking a lot of folks, which is, as you're sitting, from where you're sitting, what's one thing that's causing you to be pessimistic right now, cause for concern.

And what's one thing that you're finding optimism within? The mass surveillance apparatus that's being deployed right now in every single country, just for contact tracing and making sure that people are following the guidelines. I think that's going to be, it's almost detrimental trying to scale that back in a couple of years. And we know after every big geopolitical event that, the residue of what's been built throughout the war stays with us for a very long time. And that's my big concern. The reason for optimism, civil society.

I think you look at how many places are having a very serious debate about the cost-benefit of every action. And it's engaging more people within their community and not necessarily across different sectors to come in and even be just be cognizant of the other. So that's definitely optimistic. I agree. I think that the rise in consciousness of these issues, right? Like it was highly possible that we were going to get this sort of creeping frog in the pot mass surveillance regardless of any factor.

But the fact that there's at least more eyes on that, more attention being paid, I think, is a positive thing. And sort of for me, the question is, you know, what we can do about it and how fast we can move, given what's already happening and the wheels in motion. But Maya, thank you so much for hanging out today and spending some time with us. Anytime. Thanks for having me. I think one of Maya's most salient points in that conversation was the identification that there is an inherent tension between, on the one hand, supply chains returning to, within national borders, a physical localism, and on the other hand, a need for globalism

when it comes to fighting shared threats. I think that tension between the unwinding of globalism and globalization and the return and resurgence of localism, be it in the context of domestic manufacturing or finance, is going to define a lot of the next decade. I wonder, And I also worry that we won't be able to have the nuanced conversation that says, it's okay for these supply chains to be globalized while these shouldn't be. And to make this not always an inherently political issue vis-a-vis America first or Israel first or whichever nation first. I don't know that that's possible or pragmatic.

It may be that our political structures just preclude that sort of nuance. Whatever the case, I think we are at a sea-change moment. And perhaps these forces were already there. In fact, it's for sure that they were already there. But as an accelerant, I think this was a major, major moment that we will study forever. But that's all for today. I hope you guys enjoyed that conversation. And as always, I appreciate you hanging out and listening.

Until tomorrow, be safe and take care of each other. Peace.