CoinGeek Conversations

There are more problems that Bitcoin could solve than Craig Wright, nChain’s Chief Scientist, can ever deal with: “I have an infinite amount of things that I would happily have people doing. I just don't have the resources to have an infinite number of people working for me. But the reality is there are so many different problems.”

Dr Wright was answering questions from the audience at the Cambrian SV developers conference in Lisbon in February, in a session chaired by Money Button’s CEO, Ryan X. Charles. 

He criticised some of the big companies backed by Silicon Valley investors, such as Uber and WeWork - the latter for its self-image as a tech company at all (“I mean, 'we're a technology company because we put sensors on the doors'. I mean, really?) Some tech companies pick non-problems, he said: “problems that are being created so that they can raise money. And what you should be doing is problems that are real problems - and the world is full of them.” 

For Craig, there’s too much emphasis on winning venture capital: “ignore the Silicon Valley idea of you just raise money. What you really need to do is find a way of making something profitable.”

As to where he was putting his own research efforts, in answer to a question about the use of blockchain to design secure voting systems, Craig talked about ways of establishing pseudonymous identities and did admit that “there are some areas that I'm working on at the moment doing all these things. So I know a little bit about it. But because I'm a nasty person who patents everything, I'm not going to actually tell you all the solutions we've got until they're ready.”

Getting down to the basics about the way he, as Satoshi Nakamoto, had designed Bitcoin, Craig talked about SPV - Simple Payment Verification -, the system that allows transactions between Bitcoin users to be made directly, peer to peer, as set out in the original White Paper. Whilst blockchain nodes record every transaction on every block, that’s not practical for every user: the system wouldn’t scale if that was required. 

Instead, the individual user has “a lightweight client that doesn't have the full node, doesn't keep all the blocks, just maintains block headers and its own information. So it scales a lot better because rather than having to have petabytes of information for every phone in the future, then all you need is the block information, because the reality is that you don't need to or want to validate every single transaction on earth.” 

Originally, this kind of peer to peer transaction was thought of in terms of IP to IP address, but Craig said there are other systems that could also be used. He mentioned, as an example, a distributed Bluetooth network called Bridgefy, which he said could be useful if a government was trying to close down the Internet: “what do you do? You just turn on Bridgefy and you hop between phones. And you end up with a wide distributed peer network and SPV could be built on something like that as well. So I said IP to IP, but I'd like to see Bridgefy. And I'd like to see all these other protocols as well.”

Craig explained that it wasn’t just financial transactions that could use such a network. Messages could also be attached to transactions and “no one on chain will ever know. So we can privately maintain information as well as publicly exchanging.”

In 2003, Jeff Chen single-handedly built his own web browser, Maxthon. With its customizable interface, the fast, secure and ad-free web browser drew the attention of investors and Jeff turned it into a profitable business. Today it serves 100 million monthly users in over 140 countries.  

Now Jeff has discovered the capabilities of Bitcoin SV and is building the latest version of his browser on the BSV blockchain, as well as creating a revolutionary internet domain-name system where all the information will be stored on the chain.  

Speaking to Charles Miller in this week’s CoinGeek Conversations, Jeff explained what drew him to Bitcoin SV. “With BTC, it’s not possible to do it because it cannot scale. I observed and learned BSV for around 6 months; I understand its technology and the potential. I started thinking about how to integrate the browser with blockchain and to present that in a very user-friendly way.” Jeff hopes to create a global public data storage service which is “transparent and traceable.” In turn, the browser can be a platform for other developers to create more innovative products on blockchain. 

One of the key advantages Jeff sees in using the blockchain is that money can be fully embedded into online activities. So, how will micro-payments on the new browser work? “We’ll integrate traditional wallets. People don’t have to remember a private key or a public key, all those kinds of scary terms. You use it as normal, as you use Facebook or Twitter using an account and password to log in. And you can top up some money [using fiat currencies or cryptocurrencies] to get points ...to consume all the blockchain features.” Jeff is keen to allow those who aren’t into cryptocurrency to also “get value from blockchain. We want to embrace them”. By providing payment access to BSV applications, such as Twetch, Jeff hopes to make it “very easy for people to enter this blockchain world”.  

In 2005, after securing its first investment, Maxthon was “the world’s first browser that had cloud service integrated into it.” This enabled bookmarks to be saved to the cloud and to be shared with various systems, which is now commonly available on the world’s biggest browsers. Once Maxthon hit 7 to 8 million users, it piqued the interest of businesses and investors resulting in contracts with Google and Yahoo allowing Jeff to grow his team of developers. That was the story of Maxthon: from personal project to a business with bases in Hong Kong, Beijing and later in San Francisco.  

Alongside replacing the current mx5 browser (as well as subsequent versions of the software) on blockchain, Jeff is developing a new system for domain names, which he sees as an area ripe for updating. “The domain system was designed in the nineteen eighties. …It’s a very centralised system controlled by thirteen route servers, mostly in the US, with some in Europe.” Jeff points to the inefficiencies in the domain resolving capabilities, using this chain of DNS (domain name system) servers. Regardless of an individual’s internet speed, if there’s any issue with the route server, everyone’s website access slows down. By using blockchain to de-centralise the system, each node would be capable of storing all of the information - effectively redesigning the domain name system on blockchain, making it faster and more secure. “That’s the design of BSV and that’s why we want to create big blocks” says Jeff.

Recognizing the scaling power that exists on Bitcoin SV and its ability to resolve the issues with the current internet “I think the vision of Dr. Craig [Wright], that in the future there will be only one chain, I actually believe it. It’s the rule of the internet.” 

Jeff Chen is a true innovator. Today, the stage is set to use blockchain to improve the internet user experience and the domain name system. Watch this space.

Jerry Chan’s new job as CEO of the Canadian technology company TAAL is not just a great opportunity for him, but also a kind of liberation. Jerry’s career has included spells at big investment banks Goldman Sachs and J.P.Morgan. Since he got interested in Bitcoin, around 2015, he has championed financial and technological innovation in the corporate world. But it’s been an uphill struggle: 

“It's always been a very big drain on my time and resources, having to convince upper management of building prototypes to do something new,” he says. “It's not really politically easy to start a new business line which will cannibalize your old ones, the ones that have been producing for you over decades. So therefore it's always gonna be a challenge politically.”

Now at last, at TAAL, he doesn't need to persuade a conservative boss that it’s worth pursuing radical new ideas: “the thing which immediately made me jump at this role was the chance to have the reins of a company in the space that has the right vision.”

So what is the vision for TAAL? Well, the company formerly known as Squire Mining is making a major pivot, away from mining and towards transaction processing on the Bitcoin SV blockchain. That means adopting a business model which looks to transaction fees for income instead of the traditional miner’s income from block rewards, which Jerry calls “a subsidy model”. Block rewards are currently going through one of their occasional step-change halvings, because of the way Bitcoin was originally programmed, making all miners of the Bitcoin blockchain suddenly less profitable and any alternative therefore more attractive.

As befits a former member of the financial establishment like Jerry, TAAL Distributed Information Technologies Inc., to give it its full name, is very much a play-by-the-rules company. It’s publicly listed on the Canadian stock exchange for instance. 

Jerry believes that TAAL’s very conventionality is showing the way to other mining businesses: “the miners are going to have to come out of the dark. Come out of the mines, as it were, and be transparent, be above board ...they have to come out of the woodwork and actually run a legitimate business very much in the open”.

But does TAAL want competition from other, equally forward-looking transaction processors? “I honestly welcome more players that jump in,” Jerry insists, “this is an industry where I do believe that the more players there are, the bigger the pie grows, the more profitable we all become. And so I don't intend to drive a strategy with a goal of monopoly, for instance. Because growing the ecosystem and the market is more important than growing any one company.”

Nevertheless, TAAL is positioned well to defend itself against competitors. It’s just signed a “strategic deal” with nChain, the London blockchain research and development business, which, Jerry says, “gives us access to licence some of the patents that they have, which are very, very applicable to the transaction processing business.”

One aspect of TAAL’s business model that is largely out of its hands is the size of the market for transaction processing. That depends on the development of the Bitcoin SV ecosystem. “We're definitely at the mercy of the actual ecosystem producing the amount of transactions that are required in order for transaction processors to remain profitable.” Jerry sees a four-year window in which that must happen, starting this year.

There are hopeful signs, with the US healthcare company EHR Data, for instance, talking about the possibility of generating up to 32 billion transactions a year if they can put America’s prescriptions on chain. It sounds a huge job, but Jerry is confident it can be done: “totally possible, totally&

For Stephan Nilsson, CEO of Unisot, the Bitcoin SV supply chain business in Norway, these unusual times are providing a chance to explain to potential customers the benefits of tracking their products on the blockchain. 

With industries and consumers nervous about the supply of products that they need, people want to know more, says Stephan: “where does it come from? How secure is it? How safe is it? And that’s exactly what we deliver to them.”

Unisot is using fish, a traditional Norwegian business, as a demonstration of the potential of its Bitcoin SV-based system, but “most of our customers in the seafood industry have been hit rather hard because all the restaurants are not buying any fish any more.” That has made some time for deeper understanding of their needs: “we are very fortunate that now we can have a dialogue with our customers.” 

Stephan was talking to CoinGeek producer and presenter Natalie Mason in the second of CoinGeek Conversations’ catch-ups with BSV professionals around the world, to see how they are coping with anti-Coronavirus measures in their country. Also, Charles Miller spoke to Brendan Lee, Training and Development Manager of the Bitcoin Association, in his home outside Brisbane, Australia.  

“Most of Australia is in quite a severe lockdown,” said Brendan - but actually a little less strict than in the UK, Charles noted. Brendan’s family are allowed two visitors from another household, which isn’t the case in the UK. 

And “I’m eating better at the moment than I normally do because we’re cooking all of our food,” Brendan said, “we’re not going to be starving any time soon”. After a couple of years of intense work, Brendan is looking forward to spending more time with his family. There are plans for a camping trip to the bottom of the garden. Until now, any free time has been devoted to home schooling their two children, aged four and seven. It’s been something of a revelation: “my hat goes off to primary school teachers,” Brendan admits.

Coming back to Bitcoin, there is an overlap between Brendan’s educational role at the Bitcoin Association and his time with his children. “My four-year old uses Handcash. She can send money to her brother.” It’s made Brendan think more about Bitcoin education at all levels: “I’d love to be trying to have this material being taught even at high school - because I think Bitcoin is going to become crucial in the IT industry. Any project that uses the Internet and is exchanging information is going to be making use of the ledger ..so the sooner we can teach those young, up-and-coming kids…”

It’s said that you should never waste a good crisis. Nobody could accuse Stephan or Brendan of that. 

Today, when people ask “how are you doing?”, they expect an answer. The question is now more than just a polite alternative to clearing your throat before the conversation begins. 

And everyone’s answer is different. At best, you may find yourself in a physically cut-off world, except from those you live with - who you may be getting to know even better than you thought possible. But you may also be more in touch with long-lost friends and family members around the world, just to ask them “how are you doing?”.

This week and next, CoinGeek Conversations is putting that question to some of our friends near and far, starting with Ryan X. Charles, the founder and CEO of Money Button in California, and Lise Li, China Manager of the Bitcoin Association, in Beijing. Podcast host Charles Miller is joined by CoinGeek’s new producer Natalie Mason, to compare their calls to Ryan and Lise. 

Ryan spoke to us from San Francisco. Having been under lockdown for a month, California being the first state government to enforce restrictions of movement, he talks about the effect that has had in comparison with other states and what permanent shifts may happen to the world of work.

Looking at the long-term implications worldwide, Ryan shared his view on the importance of regular testing and authentication to combat future pandemics. To be able to open up global travel again, he says, “we’re going to need to know if you’ve had a virus or not. This will not be the last pandemic and we need global infrastructure to be prepared for the next one”. How may this look in the future? “Your ID card may end up telling you whether you have been tested for and whether you have or have had viruses in the past.”

From Beijing, Lise provides a note of optimism since the city, and indeed the whole of China, is gradually easing the virus lockdown, although ordinary life is still far from normal: “if you want to dine in a restaurant, at every table there should be no more than two people,” Lise says. And the tables themselves need to be separated by two metres.  

Lise is still only leaving home if there’s something she has to do. Nothing is back to how it was but “it’s much better than it was one or two months ago”.

Daniel Diemers started out as a coder in the Eighties. Interested in the interactions between international gamers in the earliest stages of online multiplayer gaming, he studied trust-building among virtual communities as his PhD subject. Digital native Daniel was able to grab the attention of big corporations, even back then during the first dot-com era.   

Fast forward to today, and as a business strategy consultant, Daniel makes the world of blockchain accessible to the world’s biggest corporate players. “Digitalization for corporations is quite a complex thing,” he says. “It’s not just blockchain; they're looking at other technologies depending on the industry - drones or robots or augmented reality, virtual reality. So, in the boardrooms today the heat is rising because the exponential technologies are coming with full force.”

The “fascinating thing about the blockchain ecosystem” is the high levels of engagement and communication online. “They interact almost like tribes”, says Daniel, “and of course, now it touches the borders of the large corporates. And they're looking at this and they see it. It's a different language. It's different values.” 

In this week’s CoinGeek Conversations podcast, Charles Miller asked how Daniel’s discussions of blockchain play out in the boardroom. They involve dispelling the hype, myths and negative perceptions, Daniel replied, whilst also showing the opportunities. “Ignore all the Silk Road stories. Topics like criminals and fraud; this has been riddling our industry now for the past years. It's no secret. I mean, that was in the past. We’re going into the future …As a strategy consultant, when I work with clients, I always look at the opportunities. I look at growth …I try to take a fair and square look at it, saying these are the opportunities. You can either wait or you can dive in now and give them the options.”   

For Daniel, the most important sell is also the hardest one: a global logistics solution that exists on chain. “I see a risk in that most pilots are not that spectacular. Because if you don't pursue the big vision but you go after a very small little tiny use case, then they jump on a permission blockchain for that and they don't see the benefit of doing this on a large scalable one …And of course, results can’t be that spectacular because it's just a little thing. You're not swimming out in the ocean. You're just dipping in the hotel pool. And that's just not the real thing.” 

Looking to a future world, in 10 to 15 years, that may be shaped by self-driving, Daniel lays out a compelling example of why the system would require a public blockchain, relying on large scalable micro-transactions, rather than a private, permission-based one. 

“Imagine in just the city of London, if all cars were moving in sync using AIs. How do you do all these micro-transactions? How do they communicate with each other? If there's going to be a master database sitting here somewhere in the city, I mean, that's a recipe for disaster. The database goes down. Hackers can penetrate it. So then probably it will be a large, scalable, microtransaction-enabled blockchain required. And this is probably where, of course, BSV comes in. But to get there, that is a big step because you need to convince the car makers, the road toll, the government, the city of London, responsible for the traffic lights. The ecosystem needs to be complete and to build that; that's a very bold vision.”

So how do we get there and what do corporates need to see when it comes to choosing a blockchain? Daniel points to solid regulations and legalities “and then they want to see how big the ecosystem is. I think this is also very important, and that's something where BSV has to grow …They want to know there's a steward of the protocol or there's mechanism built or there's companies like nChain where I can go in and find qualified people that can help m

Venture capital funding has played a huge role in the success of high growth businesses over the past decades. Instagram, Uber and Snapchat are just three relatively recent venture capital (VC) winners, with earlier examples Amazon, Facebook and Google rolling off the tongue as easy as ABC. 

But will venture capital be as relevant to the Bitcoin economy as it has been to the giants of Silicon Valley?

In the second instalment of the CambrianSV debate series, CoinGeek’s Charles Miller pitted two brains from the Bitcoin bootcamp in Lisbon against each other to argue their cases and share their views on the topic. Aaron Burns, CFO of social media platform Twetch and Jackson Laskey, a venture capitalist for Unbounded Capital, went head to head in a heated session. 

Favouring a return to angel investors over VCs, Aaron was adamant from the start that venture capital would be of “very little importance” in the Bitcoin world. He pointed to the sour taste felt by many in Silicon Valley when start-ups put in the hard work, only to have “three fat cats come in with some smooth talk and get you to sign a contract and give away 35% of your company for peanuts”. Then if the company fails, it’s burdened with returning the cash. 

Jackson prefaced his opening argument by noting that the room was rightfully critical of the way some venture capitalists have operated, particularly in Silicon Valley, up to this point. Nevertheless, he was adamant that leaving VCs out of the equation would be a mistake, “akin to the ‘full node’ fallacy of everyone needs to run their own node, or the ‘decentralised everything’ fallacy that has sort of destroyed Ethereum.”      

The heat turned up when Jackson attempted to squash Aaron’s argument outright, by stating that angel investors are the same as venture capitalists. Aaron was quick to fire back at this, calling out the VC industry as wolves in sheep clothing; or as he put it, VC’s “place bets on a million horses and they’ve rigged the entire game in favour of themselves”.

Charles brought the debaters back to the central issue of whether the Bitcoin economy will allow start-ups to liberate themselves from needing VCs. Aaron pointed to the number of millionaires in the Bitcoin world and thus the option of finding investors with an actual interest in the futures of those that they put their money behind. And whilst Jackson acknowledged that the lower development costs associated with building businesses on chain may allow people to make revenue quicker, this was a far cry from the realities of turning into profit-making entities. 

Jackson explained that the job of VCs is to identify ventures that are less risky than the market perceives. Speaking to a room of people who have chosen to build on BSV, Jackson said: “don’t you think everyone in the world is going to say, that’s crazy. That’s incredibly risky. You’re building on an industry that’s not established. You’re not building on the major chain. But I’m here and I know there’s no risk on building on BSV... I can give you guys money at a more favourable rate than almost anyone else can.”

The recent Cambrian SV Bootcamp in Lisbon brought together about 30 developers and entrepreneurs from around the world. As well as writing code to make their businesses more interoperable, there was time for wider discussion, some of which took place in two debates where issues were aired in front of the rest of the attendees.

The first of those debates makes up this week’s CoinGeek Conversations podcast. It’s between Ryan X. Charles of Money Button and Jimmy Odom of Bittboard (right and left, above). Their subject: how different are Bitcoin businesses from any other kind?

For Jimmy, Bitcoin businesses are different because of their being able to link data and money: “I think that this is the first time that we've had the ability in human history to truly associate the value of information. Before, there would always be guardrails or gatekeepers or intermediaries who would assign the value of information. But Bitcoin being the open protocol that it is, gives not only the ability to assign that value, but to evenly distribute the information behind the assigning of that value.”

Ryan was less inclined to see Bitcoin businesses as fundamentally different because “it's actually the same rules of business and the same rules of economics that it's always been”. He warned that where Bitcoin entrepreneurs (or those in the wider crypto sector) had seen themselves as outside of the ordinary rules of business, it had resulted in dodgy ICOs and scams and that “some of those people have actually gone to prison”.

Although the tech giants have come in for plenty of criticism from the crypto world and elsewhere, Ryan said that “although I think that Google and Facebook has done a lot of things wrong, a lot of businesses in crypto have done things way worse than Google and Facebook, at least on a smaller scale.”

For Jimmy, “neither Google nor Facebook were ever propositioning themselves as moral standard bearers”. Ryan saw the basic problem as being that they “sort of slyly cover up some of the things that they're doing ...I think they don't quite get the morality right. I think that has a lot to do with the fact that they can continue with business models that are ultimately, I think - I hate to be extreme - but I think will ultimately fail. They can't just sell other people's private data and have that be the way things work forever”.

Jimmy sees Bitcoin as more like a natural phenomenon than an ingenious piece of technology, describing it as “this really fascinating discovery - because I don't think it was invented”. The morality that Bitcoin promotes through the way it works relates to his strong Christian faith, with Bitcoin and Christian morality in sync and relating to “the higher power”. 

More than once in the debate, Ryan said that he wanted to “both agree and disagree” with Jimmy’s view, but he went along with the idea that Bitcoin promotes better behaviour by businesses: “I think it actually does encourage a better morality because companies basically have to be more transparent and accountable than they used to be. So it encourages the right thing.”

Brad Jasper is an American developer with a track record of creating interesting projects - everything from an app to turn videos into podcasts to a website to help remote workers. Now he’s focussing on Bitcoin SV with his latest project, Bit.sv, a platform for every kind of digital content creator, including coaches, journalists, artists or traders, allowing them to offer premium content, monetized with Bitcoin SV.

Bit.sv is Brad’s second BSV project, the first being Open Directory, where you can earn money for submitting useful or popular links. He says it’s “Reddit on the blockchain”. Although Open Directory is still active, Brad says he’s now committed to making Bit.sv a success, because it’s “the big one”. After working on many different projects, he thinks he’s found the sweet spot between what he wants to make and what people would pay for: 

“If I could work on one idea for the rest of my life it would be this one. I really care about getting creators independent ...I think the most impactful thing I can do is to work on my best idea, which is to get as many people as possible working on their best ideas. And that's just about the longest lever I think I can pull. I've got other projects but this is the top of the mountain. This is the mission.”

The idea of Bit.sv is to provide a way for the makers of specialist content to reach niche audiences and be paid for their work. As Brad explains: “with advertising, you need relatively large audiences. And that's actually pretty difficult to grow for most creators. So the kind of niche content that a lot of people are interested in, the long tail content where a lot of the stuff kind of bubbles up into the mainstream, it's really difficult to make a living doing that kind of thing. Bit.SV is really a platform to incentivise the kind of interesting, weird, fun, cool content that we all really want, but it's difficult to make the time for.”

It’s easy to see why creators would like a chance to be paid. But will customers be willing to pay for things they might otherwise expect to see for free? Brad is confident: “the content just has to be better. It has to be better than anything you can get anywhere online for free.” Finding those niche markets is going to be key:  “so if you're a yoga teacher, not just doing yoga, but yoga for programmers who spend ten hours a day at the computer. Putting things in people's language adds value for them and people I think are willing to pay for that.”

As for the business model of Bit.sv, the creators can decide how much, if any, of their content they want to offer for free and then set up a paywall at whatever price they choose. “We take a 10 percent cut from the paywalls and there's going to be some other services on the site that we'll take a similar cut for.”

Brad doesn’t only want to be the business owner, but plans to contribute content to the site too: “I'd also just like to be a creator on Bit.sv, to be kind of Creator Zero and show people how it's done and make an independent living from it myself. I think there's a lot of really interesting opportunities for creators that I'm excited to kind of burst open the doors and let people start playing with it and see what they do.”

Encyclopaedias once came as expensive books in many volumes - until the 1990s, when they moved to CD-ROMs, which were smaller, cheaper and included more pictures, and video. 

But putting an encyclopedia online was better still, because it could be constantly updated. That was the vision of a former Chicago day trader Jimmy Wales when, in  I999, he created - Nupedia. But Nupedia’s software and its editorial processes were so complex - that he started again, with Wikipedia. 

This time, anyone could contribute articles and edit them. Jimmy rejected the idea of supporting the business with ads, and Wikipedia.com became the not-for-profit Wikipedia.org. Today Wikipedia is far bigger than any traditional encyclopedia has ever been, with more than 52 million articles in more than 300 languages, attracting one and half billion unique visitors a month. They are also its editors, and pay for it through voluntary donations. 

Jimmy Wales spoke at CoinGeek’s London conference, where he reflected on what Bitcoin SV supporters have in common with the early proponents of a free, online encyclopedia - since Wikipedia’s feasibility was just as much of a challenge to conventional wisdom as the notion of a global Bitcoin economy is today.

“I think that there's definitely parallels and there's differences as well. So one of the huge parallels has to do with the idea of decentralization generally,” Jimmy said. When you think of an accounting ledger, you might imagine that would involve “one big server somewhere with a big bank looking after it”. But with the design of Bitcoin, “we can do that in a completely new way, in a decentralized way, in public. That's pretty cool. That's pretty fascinating. And I think a lot of those kinds of vibes around decentralization are something that are held in common.”

Jimmy is adamant that blockchain would not be a good idea for Wikipedia. That’s partly because he’s sceptical that there is a demand for a micropayments technology: “the consumers don't want it. They don't like it. It feels funny to them. One of the great things about, say, Netflix is you pay your monthly fee, which is quite nominal, really ...And there's something nice about that it's already paid for. And I just watch as much as I want.. A lot of Amazon services could be implemented on a micropayment level because they've already got our credit cards. They can sum it all up and bill us at the end of the month for our usage on Kindle or something like this… It seems to me that by and large, consumers are sceptical of that model. It doesn't feel right to them.”