CoinGeek Conversations

The history of Bitcoin began long before Satoshi Nakamoto’s White Paper appeared on an obscure online messageboard. Many of the ideas that Satoshi used had been part of previous cryptocurrencies. But Satoshi combined them in an original way and added his own brilliant solution to problems that had dogged previous attempts at digital currencies.

Around 2008, Ian Grigg was a financial cryptographer on the fringes of a loosely-defined group known as the cypherpunks. They anticipated a blending of cryptography with the ever-growing Internet: “if you put the two together,” Ian said, ”you created the possibility of having, if you like, a new trade space, a new privacy space, new monetary systems.”

There was a distinctly libertarian - if not anarchistic - flavour to the cypherpunks’ aspirations: “they were looking for ways to create a space where people could do things without having to be necessarily controlled by the big governments, the old governments, the crusty institutions that would stop you from doing certain things.”

In the first of a two-part interview for CoinGeek Conversations, Ian Grigg talks about the early days of Bitcoin and how he came to believe, before it had been suggested in the media, that Dr Craig Wright was Satoshi Nakamoto (or at least, the leader of what Ian calls “the Satoshi team”). 

When Ian first saw Satoshi’s proposal on the Cryptography Mailing List, he was sceptical: “I thought, this is never going to work. The notion of spending energy to create consensus, that'll never work. Nobody will do that.”

Nevertheless, being already well-versed in the field, Ian recognised the originality of the ideas: “it was coupling this ‘proof of work’ to the economic incentives in the sense that when you won your lottery ...that caused the generation of money or Bitcoin, and that gave people an economic incentive to do that process.” 

It was this “monetary feedback loop” that was the key to Bitcoin’s ingenious design: “this was quite a stunning notion because up until then, everybody was talking about, ‘oh well, somebody would issue some money and then manually we would pay for stuff’. But nobody had advanced the idea that the machine itself would generate its own money and distribute it.”

Ian followed what was happening in Bitcoin for a few years, until about 2014 when the search for the identity of Satoshi was hotting up. He felt strongly that Satoshi should be allowed to stay hidden: “​​we come from the privacy sector ...And all we're trying to do is take away his privacy. This caused me to be very disquieted.”

Ian began spreading this view, and eventually had some effect on his peers. But it didn’t stop Satoshi being unmasked in December 2015. Ian’s role in trying to protect Dr Craig Wright during that episode is the subject of next week’s episode of CoinGeek Conversations.  

Dr Maximilian Sinan Korkmaz is a civil engineer who has been working in the construction industry for 16 years. He founded Stabilwerk Bau, a construction company based in Frankfurt, Germany. Stabilwerk Bau now accepts his BSV blockchain-based credit tokens as payment for its services. On this episode of CoinGeek Conversations, Dr Korkmaz discusses some of the obstacles experienced in the construction industry today and how blockchain can offer solutions. 

Dr Korkmaz first caught wind of Bitcoin while studying for his PhD in 2010 but it wasn’t until 2017 that he took a liking to it, specifically the Bitcoin SV blockchain. “I chose Bitcoin SV because the promises were all about industries and applications and businesses so I thought it was the right one for me.”  

As he tells Charles Miller in this week’s podcast, there is a lack of digitization in the construction industry. He notes that issues often arise from communication problems between participants involved in a construction project. To address those concerns, Dr Korkmaz found a solution in blockchain. “I thought I might be able to make these processes more efficient using blockchain,” he notes. 

Furthermore, Dr Korkmaz says Stabilwerk Bau is the first construction company in the world to accept credit tokens as payment for services. As he explains, Stabilwerk Credits, which run on the BSV blockchain, offer his clients the chance to pay the company in fiat in exchange for credit tokens. The incentive for those who choose this payment option is to receive a ten per cent reduction in cost. In addition, Dr Korkmaz, says Stabilwerk Bau plans to “tokenize the entire relationship among the actors of construction projects,” to provide for a smoother, swifter and more efficient communication process. 

Also in the pipeline is the P2P software company he has founded, to offer blockchain solutions to the construction industry and others. Dr Korkmaz plans to produce an app that will connect clients to general contractors and general contractors to subcontractors within an area. The app, which will work exclusively with Bitcoin SV, will be made available to users worldwide.

Governments and legacy financial systems all over the world are discovering that it’s not easy being green. And Bitcoin is no exception. Elon Musk famously reversed his decision to accept Bitcoin as payment for Tesla in May, citing environmental concerns as the reason. But many in the Bitcoin SV world are confident that it can and will be eco-friendly.

Zach Resnick, Managing Partner of venture capital fund Unbounded Capital is one of many unconcerned BSVers. “We would argue that Bitcoin is perhaps one of the most eco-friendly technologies ever created,” he says. 

 Zach argues that Bitcoin’s design incentivises miners to find cheap energy to maximise their profits. As renewables are cheaper, they are encouraged to find or create clean, renewable sources of energy. 

 He also points out that because Bitcoin miners can be located anywhere, they can make use of renewable energy in places that conventional energy customers couldn’t otherwise use. 

 “You can start up a mining operation with one hundred per cent renewable energy anywhere, really far from any grid and still be able to utilise all the energy efficiently.” 

 This means that poorer countries can use natural resources, like hydropower, to mine Bitcoin and make money. This was a central argument in Stone Ridge’s annual shareholder letter, which outlines the economic benefits Bitcoin will bring to the world.  

 On this week’s episode of CoinGeek Conversations, Zach stresses that he thinks we should measure Bitcoin’s energy consumption against the value it brings to the world.

The founder of Zurich’s MoneyMuseum, Dr. Jurg Conzett discusses the history and evolution of money on this episode of CoinGeek Conversations. 

As Dr. Conzett tells Charles Miller, money creation today is unlike the coins of the Middle Ages in the sense that its value remains the same after a historical event has taken place. “If there was a pandemic, you close shop, put the coins on the shelf, waited six months then opened again, the coins still have the same value.” he said. “Not so with our money, a pandemic hits and the next minute the money begins to disappear.” 

Dr. Conzett believes that money creation is changing right in front of our eyes with the digitization of central bank money to make CBDCs – central bank digital currencies. According to him, the digitization of central bank money was governments’ response to fear and uncertainty triggered by the rise of Bitcoin. “Governments around the world were frightened because when Bitcoin has risen substantially, they say, ‘what do we do if people go to an exchange and transact with Bitcoin? What happens to taxes?’ They must be in horror and say ‘we have to do something’, so what they decided is to tokenize.” 

Dr. Conzett describes a future where most of the banking money will be replaced by digitized central bank money under the control of governments, giving politicians power over the money supply. “They [politicians] have a tremendous responsibility and we will see how they go about fiscal responsibility.” 

For his part, Dr. Conzett sees no direct or necessary relation between the digitization of money and Bitcoin and blockchain, citing China as an example. “China has digitized their currency, but not with Bitcoin, not on blockchain.” He notes that Bitcoin and blockchain will only surface if and when politicians decide to incorporate blockchain technology into the digitized money system. “There will be pressure to bring all the money onto the blockchain, because once it's on blockchain, at least in BSV, it will be public knowledge.” But in order to get there, he believes people must increase the token economy. 

As for the future of blockchain, Dr. Conzett believes only one Bitcoin ecosystem will prevail. “In my opinion, there will be one blockchain which attracts most because it will be the most efficient, and the most efficient, I think will win.”

There is “no doubt that blockchain technology is here to stay,” says IBM’s Tatjana Meier. 

 Tatjana, Blockchain Practice Leader at IBM Services Switzerland, admits that it’s still early days for the technology. But she is confident it will prove beneficial for businesses and consumers alike and “can do a lot of good.” 

 She is particularly excited about the value blockchain brings to supply chain management. Traditionally, she explains, “you only have information one tier back, but you don’t have the visibility along the supply chain.” 

 This is not the case when companies use blockchains. Blockchains helps participants record price, quality, and other relevant information to help manage a supply chain. This improves the traceability and sustainability of products by making it easier for companies to detect unethical suppliers or counterfeit products. 

 During a panel discussion at CoinGeek Zurich, Tatjana argued that this will ease regulatory and consumer pressure. On this week’s episode of CoinGeek Conversations, she explained further, citing a new law on human rights in supply chains that has recently been adopted by the German Parliament. 

 The law will require large companies to regularly identify and address human rights and environmental concerns in their supply chains. Businesses will be expected to publish reports outlining what they are doing to tackle any risks and are liable to fines if they do not show that they have addressed abuses. 

 The immutability of blockchain will make it much easier for companies to do their due diligence, says Tatjana. Indeed, the transparency of the technology has even earned it the nickname of the ‘trust machine’ from the Economist.

 This transparency will allow big companies to win points with increasingly ethically aware customers, as well as regulators. 

Entrepreneurs Joe De Pinto and Dan Wagner have created a unique use for microtransactions through Haste, an online games arcade with what they call Instant Leaderboard Payout or ILP games. The idea is that the top players in a game at any time receive payouts from the small entry fees paid by the rest of the players. Everyone’s trying to get to the top of the leaderboard where they’ll be earning money instead of spending it.

Joe explains how he and Dan were inspired by the possibilities created by the micropayment capabilities of Bitcoin SV (BSV): “It’s really simple to understand. You take a quarter, a dime, a nickel, you play a simple game and you split that money hundreds of ways.” 

On this week’s CoinGeek Conversations, Charles Miller and the two business partners from Los Angeles discuss all the possible ways a player – or even non-players - can earn money with Haste.

And, as Dan explains, unlike with traditional payment systems, the use of BSV allows players to receive payouts in real time. “It doesn't matter where you're at anywhere in the world, if you're on the leaderboard, your wallet gets pinged immediately, instantly, without the platform ever touching anything.”

Alongside the game play, there are now Haste tokens, which, similar to a traditional arcade, can be redeemed. But instead of being rewarded with a stuffed animal and the like, they get BSV. “The tokens do a good job of representing a way to reward people simply for playing without even having to make the leaderboard.”

Finally, in Haste, users can also create their own NFT player card, which in turn rewards the owner with a 10 percent rebate each time they play. In addition, all players can also buy and trade cards.

Joe and Dan, who are also co-founders of a popular app called Barpay, a platform that allows customers to order and pay for their drinks at bars and restaurants, bring their previous experience in business into Haste. Barpay has been successful in helping customers make payment transactions in establishments, especially in crowded places. In the past year, Dan said Barpay saw a sudden growth in demand. With the pandemic, he points out that more establishments wanted their customers to be able to access their menus online - a need Barpay could address.

“Before Covid, we were in several dozen restaurants with just an app that you could use to order and pay for drinks during the busy times. At this point, we have over eleven thousand digital menu type accounts, several hundred order and pay accounts that are allowing people to scan a QR code to place an order and pay for it.”  

Dan sees Bitcoin being used as a form of payment on Barpay in the future. “We can take that [Bitcoin] to the rest of the market, telling these owners, we just figured out how to save you three percent on every transaction. That is going to be an absolute game changer for these merchants.”

What’s next for Haste? Expect new features in the near future as two senior developers will be joining the team very soon.    

Digital currencies can survive if they embrace the rule of law, says leading economist and professor at New York University’s Stern School of Business, Nouriel Roubini.

The economist, who is known as “Dr. Doom” for his pessimistic predictions about the economy, including in 2008 when he famously predicted the housing bubble crash, believes that legal institutions will help bring reliability to cryptocurrencies. 

Nouriel says AML and KYC legislation will be crucial to the acceptance of Bitcoin by legacy financial systems. “You need regulation, you need that credibility, but you build it by having institutions,” he says.

 The importance he places on the rule of law is one subject which he and Dr. Craig Wright, the inventor of Bitcoin, agree on. The two men shared a stage together at CoinGeek Zurich last week, where they discussed the role of Bitcoin in our financial system and the digital asset market. 

During his combative keynote speech, Nouriel argued that cryptocurrencies are weakened by a lack of regulation. He explains further to Charles Miller, on this week’s episode of CoinGeek Conversations, that he thinks there needs to be an international agreement on the regulation of cryptocurrencies to ensure we don’t end up with a “law of the jungle.” 

Nouriel also agrees with Dr. Craig Wright on the legal benefits of Bitcoin being a pseudonymous currency, rather than an anonymous one, saying “law enforcement prefers people using Bitcoin rather than an offshore financial centre for a variety of criminal activities.” 

This is because every Bitcoin transaction is recorded on the blockchain, a permanent and public ledger, which anyone can access. This means transactions are traceable, public keys can be identified and criminals can be connected to digital wallets, bursting with ill-gotten gains. 

This was proven last week in the United States, when the FBI traced $2.3 million worth of Bitcoins, extorted by a criminal hacking group known as DarkSide. The money, paid in ransom by Colonial Pipeline, was not only found but seized by federal investigators. 

This will help to prove the legitimacy of digital currencies and shift the image of Bitcoin as the currency of choice for criminals, especially when combined with regulation. 

While Nouriel is no convert to Bitcoin SV just yet, it seems that the attractive regulatory framework BSV is building, the proven traceability of digital assets and the contempt for BTC that he shares with those working in the BSV ecosystem, could lead to a change of perspective from “Dr. Doom” in the future.  

How do you attract the attention of young people in 2021? By offering them cryptocurrency, says Phuong Dinh, entrepreneur and founder of Mijem Inc. 

 That’s why he has decided to integrate a Bitcoin SV cashback reward scheme into the online community he has created. Mijem is a free app aimed at college students in the United States and Canada, that allows members to buy and sell items, like eBay, but for Gen Z.   

 According to Phuong, a high proportion of the student demographic “have never owned cryptocurrency but would like to own one.” Indeed, a Coinbase survey conducted in 2018, found that 18% of US students said they own (or have owned) cryptocurrency, twice the rate of the general population.

 The platform will be introducing a loyalty program, built on the BSV blockchain, where students who buy items using Mijem’s payment system are rewarded with points that they can redeem or convert to BSV.

 Phuong explains to Charles Miller, on this week’s episode of CoinGeek Conversations, that he believes the integration of digital currency into the app will “incentivise” students to use it more.

 This unique scheme, which will be rolled out later in the year, will be created in partnership with Fabriik, so users can transfer the BSV that they have earned directly into their own wallets.

 Picking BSV as the app’s digital currency of choice was a no-brainer for Phuong; “it’s what the original Satoshi envisioned,” he says. He praises BSV for its technological advantages and the efforts within the ecosystem to find solutions to Bitcoin’s environmental footprint. 

 Mijem connects students with their peers so they can efficiently buy, sell and trade goods and services, meeting a need for those in secondary education who are keen to engage with each other.

 Phuong tells Charles that when he first pitched the idea, there was immediate interest as students all need similar things and are all based in the same place (on campus) where they can exchange items easily.

 He says, “they have collections of furniture that other students may need because they’re all in a similar phase in life, so they all need a mini fridge, they all need a couch, they all need similar things.”

 Central to the platform’s ethos is transparency: users can see who members are, who their friends are, what ratings they have and message them, if needed. 

 Mijem has partnered with over 70 universities in the United States and Canada so far, but Phuong says he has plans to venture further afield in the future. With the global student population expected to reach 380 million by 2030, Mijem has a wealth of potential customers. Phoung plans to offer them BSV as Gen Z’s coin of choice.

Bitcoin SV needs to put more emphasis on connecting its experts and developers with potential business users, according to Patrick Prinz of the Bitcoin Association. Talking on CoinGeek Conversations, Patrick stressed the importance of creating a ‘distribution arm’ to introduce  businesses to the new world of digital transformation. He cites Salesforce, an American cloud-based software company that provides a customer relationship management service as a company that “built an army of outside distributors by incentivizing them”. 

He views this kind of business model as a particular opportunity for BSV because of its own technical capabilities. “I think we have a unique tool that allows us to incentivize people like never before: it's microtransactions. You can let people contribute and then reward them in real time as revenue comes in.”

But he also envisages a job that has much in common with existing marketing and consultancy practices. “This is relationship management work,” Patrick asserts. “You can buy the services or become a distribution partner. This is the opportunity that I'm looking at.” 

Patrick comes from a financial services and consulting background. He notes that there is a disconnect between the BSV ecosystem and most of the industries it could serve. “In order to bridge this gap,” he says “it requires people who can translate the technical terminology... who can guide the companies within the growing ecosystem.”

As Europe and Operations Manager for Bitcoin Association, a non-profit that promotes Bitcoin SV, Patrick is also one of the organizers for the upcoming CoinGeek conference to be held in Zurich, Switzerland for three days from June 6. 

Staying aligned with the theme of the conference, “Ignite the power of data”, data-driven business models will be highlighted in Zurich. Patrick believes that putting people’s focus on data as opposed to Bitcoin as a digital currency, serves BSV well. As he tells CoinGeek Conversations’ host Charles Miller, the strategy is very clear. “We are building businesses. We're not doing a marketing pump and dump so it takes longer and naturally people have to be more patient. But once the foundation has been laid, it's unstoppable.” 

On this episode, Charles and Patrick also discussed Elon Musk’s recent remarks in reference to Bitcoin mining being environmentally unfriendly, on which Patrick comments: “The ecological aspects is a very trendy topic... it requires education on why proof of work is superior... there's clear incentives and a certain visibility and transparency of the players that is extremely important to the security of the network.”