LETS TALK BITCOIN

Episode 95 The Captain and the Keep

Participants:

Adam B. Levine (AL) - Host
Stephanie Murphy (SM) Co-host
Andreas M. Antonopoulos (AA) Co-host
Anthony Di Iorio (ADI) Founder of Ethereum, Executive Director of Bitcoin Alliance of
Canada


AL: Today is March 25
th
2014 and this is Episode 95. This program is intended for
informational and educational purposes only. Cryptocurrency is a new field of study.
Consult your local futurist, lawyer, cartoonist, investment advisor, international
accountability coordinator and ethnobotonist before making any investment decisions for
yourself.

Welcome to Lets Talk Bitcoin, a twice weekly show about the ideas, people and projects
building the digital economy and the future of money. This is a long one so were going to
get right into it.

We talk Ethereum Ive never seen something like this blow up the way it has in
such a short time.
The Toronto Conference This is (??) the work of the (??) and art show thats going
on during the event, where actual artwork will be created during the talks when
theyre going on and then well be having an auction on the last day.
The Bitcoin Foundation, past and future Its bound to happen because these things
dont happen because of technical failures, they dont happen because of bad actors,
they happen because of failures of leadership and the Foundation is the very
definition of a failure of leadership and, therefore, these things will happen to them
eventually.

AL: I like how Andreas waited to say that until after we start recording. (Laughter) [1:17]

SM: What he does in the privacy of his own home is his business. (Laughter) [1:22]

AL: Today Im joined on Lets Talk Bitcoin by Stephanie Murphy. *1:26+

SM: Hello. [1:26]

AL: Andreas M. Antonopoulos. [1:28]

AA: Hey there. [1:28]

AL: ...and special guest host, Anthony Di Iorio, who is the Executive Director of the Bitcoin
Alliance of Canada, Co-founder of KryptoKit, a founder on the Ethereum project, and many,
many others; full disclosure. Anthony is also an individual sponsor of the Lets Talk Bitcoin
show. Anthony thanks for joining us today on Lets Talk Bitcoin. *1:43+

AD: Its an honor to be on with you guys. Thanks a lot. *1:45+

AL: You have a million projects, so weve been trying to get you on to talk about the
conference up in Toronto but again, its just like were starting to do these guest-host things
and Im into this idea that we can just make this one long conversation because those really
seem to be the episodes that people like the most. Pick a project. What do you want to talk
about first because Ive got questions about all of them? [2:05]

ADI: The most recent thing that we launched was the Bitcoin Decentral Accelerate, which is
an accelerator program thats run at a Bitcoin Decentral, which is a 5,500 sq ft building, (??)
building in downtown Toronto. It gets, I think, about 100,000 cars passing every day looking
at a big orange Bitcoin sign right at the front. We house an ATM in there. Its a co-working
facility. Its a space for the Bitcoin Alliance of Canada, which is a non-profit organization in
Canada that Im involved with. We do a meetup every week that gets between 50 and 100
people, every Wednesday, in the space. Weve got some offices for Ethereum out of there.
We have HR, legal counsel (??) Etherum working out of there. Metallics place of business is
out of there. It is offices for KryptoKit; weve got a studio for CoinTalk and a bunch of
activity going on there and its getting busier every day. Its really a lively building and its
really amazing to have these people altogether in a space where ideas are just flowing.
Thats the newest thing that weve started in January. Weve got the Expo thats coming up.
Thats going to be at the Metro Toronto Convention Center. All of you guys are coming and
Im really excited to have you up there. Its going to be great. Its going to be a real
community event. [3:17]

SM: I am so looking forward to that Anthony. Its going to be awesome! *3:21+

ADI: Yeah. Ive done maybe 15 conferences in the last year and a half with Bitcoin and Ive
really learned a lot from them. I think it needs that balance. It needs that community
balance with the business balance. Thats something that I hope we can perfect. [3:35]

AL: Bitcoin Decentral right? Anthony, when was the first time we talked? On Episode 5 or
6, I think, of Lets Talk Bitcoin? *3:44+

ADI: You mean last year? [3:46]

AL: Yeah, last year, last year. It was a really early episode and, at that point, your project
was the Alliance of Canada. That was the thing that we were talking about, at that point.
You were working on... I can count 7 or 8 different projects here. What happened over the
course of that year that could put you in a position where now youre starting an incubator?
Just for all this activity everywhere I look. [4:10]

ADI: What happened was with the Alliance, I had sold a Bitcoin business before that but I
became Executive Director of the Alliance and I had nothing, I had no business interests at
all. I was a full time volunteer doing this Executive Director position and working with the
other directors. Weve got, right now, over a thousand members of the Alliance up here in
Canada. Then, things just started coming at me; with different business ventures and
different ideas. The first one was KryptoKit. My partner Steve, who I had worked with
before, just out of the blue one day said Hey, Ive been working on a Chrome extensional
Bitcoin wallet. Im like - Thats exactly whats needed. I knew that thats whats needed. Id
been dreaming about that for a while. I remember at the conference in New York at Inside
Bitcoins, last year, the Web 3.0 guy saying Thats whats needed. You need to bring it into
the browser. Nobody had done it yet and we were the first to do it and from there, we
started working on that project. Weve now got the instant messaging; weve got a Bitcoin
directory built into there. Then things just kind of snowballed. [5:07]

AL: Anthony, the question that I wanted to ask you was when you got started, did you have
a bunch of resources or was this something where, over time from being involved in the
community and acting opportunistically, you kind of levered up? [5:20]

ADI: When I got involved, I was just coming out of selling some properties. Thats what I
had done previously. I was a landlord; I had student properties and in Toronto, I thought it
was going to be hit hard very soon. I thought that the prices were way overheated. I
decided I to get out fully and just enjoy the six years before that of the housing prices going
up and thats where I came across Bitcoin. It was a perfect time and Id look and was
thinking where am I going to start investing some of this money. This was about the time
when it was about $11. Thats when I made my first purchase and I did it as easy as going to
the bank and just making a bill payment. That was my first foray in and about a month later,
I started the meetup group, and it kind of snowballed from there. With the sale of my first
business, that was a full Bitcoin sale, I did pretty well with that. Thats the thing would be to
continue on doing these type of things and funding them. It has always been the goal for
my first company and my partner to say Hey, lets get involved in something and then
well take that money and do something more meaningful for the community and for
different projects to really spread this out. Thats how it came about. *6:32+

AL: Last year, the first article that I wrote, at the time that you got in actually, at $11, thats
just about the time that I wrote this... was this article based on a bunch of interviews I did
with people who had between a couple of hundred and a couple of thousand Bitcoin. The
question at that point was Well, Bitcoin is this big ponzi scheme because all the who
people got it early and cheap are just going to sell it later and then the price will go down
because no one will want it. There was all this sort of talk. I went and I talked to people
who actually were in the situation where if Bitcoin succeeded, they would find themselves
there. All of them were talking about starting incubators, or launching start-ups. That was
the one commonality in all of the divergent opinions and things that they wanted to do. Ive
been watching your progress for a long time and it really just feels like... I dont know... Im
probably putting some of my own bias on to you here but that is what Ive kind of looked at
you like, is someone who is taking the opportunities given and levering up and then using
that. Instead of being like Alright, well now Im going to take my cash and do something
else, you say OK, now Im going to reinvest it in because it makes more sense to me and
its better just generally speaking. *7:36+

ADI: Yeah, thats exactly it. Its building up relationships. I mean, Etherum is a good
example of this. Ive known Vitalik for a long time. He was actually at the very first meetup
in Toronto that we did. Boy, hes come a long way in the last year and a half. It was
approaching him when we started doing KryptoKit, saying to him Hey, we want you to be
involved in our project here. Wed like to offer you part of our company to just continue
doing what youre doing and help development as a partner and weve got a lot of respect
for you. Its the same thing we did with Roger Ver and Erik Vorhees to bring them on board.
It was like I really love you guys. I look up to you guys a lot and Id love for you to be part
of this team with us to get, what we think is, a really amazing wallet system out there and to
improve it. It was building up those type of relationships that always seem to come back
afterwards. Thats how, I think, Vitalik brought me on board with Ethereum. I was one of
the (??) people with him and then I brought, I think, it was my connections through Charles
Hoskinson and Joseph Lubin, two of the other founders that are involved with us, right now.
Its about building up those connections and people just doing what youre doing and giving
back to the community. It all comes together in the non-profit side of what I do and in the
for profit side of what I do. Im just so passionate about this. Ive told you this before
Adam. I was like a three months guy before getting involved in Bitcoin. I have to do things
for three months then Im out. This has been a year and a half to two years for me and Im
just more excited every day to be working on this stuff. [8:58]

AL: Anthony, the Ethereum project... I think I first read the White paper that Vitalik
circulated right before I was getting on a plane to go and talk about DACS, in Washington at
a retreat that we put on for five days and I read it on the plane. I was like Wow, this is
really cool. I agree with you. I think Vitalik is a really, really interesting guy. Hes one of the
reasons why I actually got into Bitcoin journalism, ironically, because the publication he was
initially involved with had a really innovative... like... were not going to release the next
article until enough people pay us a total of... I think they were going for half of a Bitcoin,
back when they were very, very inexpensive. It was small amounts but the point is that it
was a really innovative model that used this thing. Vitalik, I totally agree with you, hes
really kind of going down this rabbit hole but its an ambitious project. You guys are trying
to do things that are hard. If you look at other projects in the space, theyre not as
ambitious. Do you think that theres a reason there? Do you think that this is like a moon-
shot type of project? Or, are you guys really feeling like this is accomplishable? [10:00]

ADI: Im really confident just because I trust Vitalik so much and Ive gotten to know him
very well. Hes an extremely straight forward, reliable and, in my opinion, genius. Ive
spoken to other people and our other developers working on the project and they are very
confident about what were doing now. That gives me a lot of confidence. Ive never seen
something like this grow so quickly. Weve got 50/60 Skype groups going right now, with
hundreds of people involved. Weve got 25 meetup groups across the world, including one
which just had its first in Tehran, in Iran, yesterday or the day before. Ive never seen
something like this blow up the way it has in such a short time. I mean, we started this in
January, the beginning of January. I got involved in the project at the end of December and
started this, really, in January. What weve been able to accomplish, I think, over a few
short months has been spectacular. The community is really coming behind us and its this
community growth and the excitement that were seeing, which is leading for people to
start up meetup groups just because theyre so enthusiastic about it. *10:59+

SM: Are you talking about meetup groups for Ethereum? [11:03]

ADI: Weve got over 25 now, meetup groups for Ethereum. [11:05]

SM: OK, wow! [11:06]

AA: Yeah, one popped up in my area recently. Its rather interesting. Im going to go visit it
this week, I hope. [11:11]

ADI: Yeah, so were calling in to them on a regular basis. Were just saying Hey, can you
come do a Skype call in to the group. Theyre not just 4 or 5 people, theres meetings of 30-
40 people involved in these things. Thats where you can really tell what people are feeling
about a project. Its also the excitement of other guys. I mean, MasterCoin theyre
thrilled about what were doing. Were going to be doing some work, hopefully, with...
collaborations with Open Transactions. They are one of our partners, actually, our strategic
partners. Weve got even companies like AVG, the anti-virus guys that are excited and
reached out to us and got some ideas for monetization strategies for their virus software
program. Its really touching a lot of different people and its really exciting to be involved in
this. [11:51]

SM: What would go on at an Ethereum meetup? [11:56]

ADI: In general, a representative, or somebody who has reached out to say I want to start
up this meetup. Can you give us some tools? We give them some educational tools. We
usually have one or two of the leadership team call in, answer questions from the people in
the space there and let them know whats going on with the product sale and when we plan
on starting to sell Ether which, of course, is the currency of Ethereum. Its information that
they want to understand better how the project came about, what obstacles were facing, if
we need people to get involved. Were an open source project on one side of things so
theres lot of opportunities for people to start helping and assisting us. Its unique. Its an
extremely unique situation and its being run by a really well organized team. Were just
moving really quickly. In a couple of months, to be able to have this team that we put
together; not have an issue with developers. Like, weve got a plethora of developers
helping us out which seems to be the common problem in the space right now, especially
with the next level of cryptocurrencies. People are just having to struggle to get developers
on board. We just dont have that issue where people are just flocking to it and helping us
out. Most of them are volunteers. [13:05]

AL: You have not sold any Ether yet. That is something that was originally scheduled for the
end of January and has moved a couple of times. Can you share some of the genesis of that
process? [13:18]

ADI: The plan initially, was to launch in Miami. At the time, it was going to be called a
fundraiser and we had to take a step back because there was too much money that we were
being told was going to come into the project. We had to be sure that we had done things
properly, in terms of security regulations. We just had to take a step back and decide which
country we were going to go to and ask to be a jurisdiction for Ethereum. We eventually
decided to go with Switzerland. We were immensely helped by the Open Transaction guys,
who had already set themselves up there. A lot of good connection. It looks like, right now,
were going to be (??) as a currency by the Swiss government. Also to be able to be sold as a
piece of software. Well not have the tax implications that we initially thought we might be
having. Its really forming to be a perfect situation for us. Were setting up there. Weve
got the hub in Toronto and the hub in Switzerland and weve got a bunch of others that
seem to be forming right now. Were setting one up probably in San Francisco, and New
York, and were calling them Wholons. Thats the name for our hubs. I think a Wholon is
like a part of the whole and the whole itself. I think thats the term. I wasnt familiar with it
before but thats what were calling our hubs in different cities. We decided to take a step
back, regroup, make sure that we were doing things properly and also, come up with plans
and strategies for where the money is going to be put for us. It really was the wisest
decision we ever made and were just taking our time right now. Were probably a couple
of weeks away. There will be lots of announcements before we start selling Ether. We
really were able to slow down and Im glad that we did. *14:53+

SM: Anthony, tell me more about this Switzerland thing. What are the specific advantages
of being a company based in Switzerland? Are you saying youre going actually be a
company that is based out of Switzerland for the initial crowd funding with Ethereum? How
did you go about that and do you think Switzerland is going to become like a Mecca for
Bitcoin businesses now? [15:15]

ADI: I think what we have is a great opportunity to lead the way there and actually work
with the Swiss government. A lot of the interaction in Switzerland is directly with the
government and thats what weve been able to do. I think were going be a... were going
to be able to write certain things because they are using us as a test model. Its gone
amazingly with what theyve been able to do for us over there and the connections with the
lawyers and connections with the OT guys who have been able to open the doors for us and
really expedite things. If we were to try to do this in some other place, this would have
taken months or maybe even a year to get all this done. Our main entity is in Switzerland.
Weve got some designers out there. Weve got some employees out there. Charles
Hoskinson has been there for the last many weeks getting things set up. He is also with
Mihai, they are two of our founders there. Weve got eight founders in total; two of them
are operating out of Toronto. Weve got one from Jamaica. Weve got one from Israel.
Thats going to be our main setup there and we have to actually keep infrastructure there.
Its not like were just setting up a shell company. Thats actually part of it and thats going
to be our main focus there. Ive got accounting and Ive got legal going on and out of
Toronto, HR is out of there. Weve got the video production; weve got some of the security
guys. [16:30]

SM: It sounds like with something like Ethereum, obviously, the ultimate goal is to be a
DAC, is to be decentralized and not have a centralized company that is issuing software, or
anything like that. Now, were kind of in this awkward in between phase where were trying
to get to that from where we are now. What is the plan as far as evolving toward being a
completely decentralized organization? [16:55]

ADI: It is definitely our plan, I think, between one or two years to take it to that route.
Thats definitely where we want to go. A large part of what were doing is were going into a
non-profit. Were going to wait to see how much actually comes in before we make that
percentage decision as to whats going to be going into a non-profit and what would be
going into a before profit entity. Our plan, what wed like to do, is to say as much as
possible that we can put into the non-profit. Thats going to be me working with
universities. Weve got two of the top cryptography people from the University of Waterloo
that have joined us and be working with us. We want to set up educational programs. We
want to set up... we think that needs some type of structure. Thats where the non-profits
going to come into play. Before profits stuff is going to go towards building the apps that
are going to be done on top of Ethereum. Its going to go towards funding the accelerator
space in Toronto that were doing. Were trying to set one up in New York, as well. It really
wasnt that we had to do it in that sense, was we had to also have a portion of it as before
profit and I dont know the details much but because of the set up that we have in
Switzerland, thats what we have to do. We are trying to balance the non-profit and before
profit to separate them. Our goal is to have as much going towards the non-profit and really
build up our infrastructure and build up the very low end parts of Ethereum, which is like
the reference client and things like that. Then separate that between the higher level stuff
which are the applications and the more higher level activities that well be doing. [18:20]

SM: Are you concerned that working with a university could slow things down, at all?
[18:25]

ADI: Yes, thats a concern of mine. I think having certain people, like Neal Koblitz are
working for us and some of the people at Metallics we worked with, it is something that I
definitely think might be a little bit more... like were travelling in mud doing that but I think
it will have to be monitored and were actually going to be the ones who are going to be on
top of that. You might be right; it might be an issue and I guess well just have to see what
comes out of it. Its not going to be all our eggs in one basket going to the university.
[18:51]

SM: I want to know more about Switzerland too. What are the specific legal, tax, whatever,
advantages of being in Switzerland for a Bitcoin business? Not that that exactly describes
Ethereum but, why Switzerland? [19:06]

ADI: You know what, I wasnt involved too much in the decision making in that I havent
been to Switzerland to figure that out. Its Charles Hoskinson thats organizing things out
there. All I know is its worked out perfectly in that we dont have any tax events that are
going to happen on the sale, yet we can still sell ourselves like were selling software. That
takes us out of the whole issues of having to deal with SCC, or having to deal with security,
or just having to do IPOs, or any type of prospectus, and things like that. [19:34]

AL: Is it fair to say that that you had lots and lots of options and picked the one that you felt
like, and apparently, have gotten the best deal for what youre trying to do? *19:43+

ADI: Yeah, Id say that. We researched it and thats going to be the best place and then
with the connections and the people that we had to have gone through that before, it was a
perfect fit. [19:52]

AL: Theres an area of the Ethereum project that Ive been highly critical of and it is that the
founders have a special rule set that was designed for them and that only applied to them
and not to anybody else. I know that Ive brought this up in the past and I know you guys
have kind of changed it a couple of times. Do you have any thoughts on that? Can you
share the genesis of why it makes sense for an Ethereum founder to get a special rule set
just for them, when other people starting other types of currencies arent doing that sort of
thing? [20:28]

ADI: The rule set is that its not just the founders. Its actually the whole team of people
that have been working on this since December that will be getting a certain percentage.
Its still getting worked out. What weve seen from the community though is, (and we think
we have a good pulse on the community) that it doesnt seem to be the things that people
are concerned about. I think were doing it in a way that will be very small and doing it in a
way that we think people have to get rewarded. Were taking on positions here; taking on
risks here. Were not creating something and then leaving this project. Its going to be
something that were going to be guiding it through for the next year to two years. Ive had
to now take the focus away from some of the things that Im working on to be working on
this more full time. That is being split between 50-60 people that have been working on the
project and havent had any payment as of yet. Were completely self-funded and
bootstrapped at the point right now. Its hasnt been cheap doing all this stuff with all the
setups, in Switzerland and in Canada here. I think were being fair with what were doing.
We still havent officially decided exactly what percentages that will be done. I think its fair.
I think the team thinks its fair and it seems like from the voice of the community that they
are more excited about what were trying to accomplish than thinking about that. [21:45]

AL: Yeah. I have a lot less problem with it now compared to when I did, when we were
talking about a launch at the end of January when there hadnt been a lot of work done to
that point. It was mostly on paper still. [21:54]

AA: I think theres a valid argument to be made. The bottom line is, this is open source
software. If you really like the idea and the concept and source code and the work thats
been done, but you dont like the teams approach to fundraising, you could always clone
and create Litethereum, build an alternative team around Litethereum, which is silver
contract to Ethereums gold contract... (laughter) and then, you could try and create an alt
contract and see if you can compete in the market. If people think thats a better way to
IPO it, theyll reward that and if people think that the original team that has people like
Vitalik and it is better suited to solve this problem and continue to maintain it, theyll back
that. I understand some peoples concern but, at the same time, Ive heard so much
hyperbole around this that, just because youre using the coin to fundraise for the team
thats developing the coin, somehow thats a scam. I think thats ridiculous because Ive
used the source code, I can go in there and create a clone of Ethereum in about 10 seconds.
Theres already three implementations of it in three different languages and launch my own.
If anybody thinks they can do it better, they have that opportunity. Its not a closed source
system, you have a choice here. [23:14]

AL: That impacts substantially though, people who have invested in it. There are two
arguments to be made here. The first is that; is it a competitive disadvantage to have
special rules for certain groups? Again, like I said, when I was having more of a problem
with this it was going to be five people and they were people who... again, I like all you
guys, its not about that I dont want you to get paid, its just that in a world that is open
source and the only competition that can beat you is the competition that takes your
finished product, forks it and then gives it away for a tenth of the price of what youve done,
it seems like that would matter to people who are buying Ether as a product. [23:49]

ADI: I think what weve got to focus on here is the team that weve got behind it, as well as
the strategic partnerships that were building. I, honestly, am not concerned about
someone else being able to bring together this type of community and this type of team
that weve been able to do. Weve been able to attract a lot of developers; a lot of people
who are realizing that theyre going to be rewarded for what theyre doing. *24:12+

AL: You guys have done a fantastic job. I really dont mean to diminish that, at all. As far as
the projects that are out there, as far as community building, investing stakeholders and...
theres not even a token yet, and the community, for sure... I mean, like Ethereum is a
project that has a ton of buzz and a ton of very good thoughts about it in the community
contrasting with a lot of the other projects. [24:33]

ADI: Its a balance Adam and its been a balance that weve been working with the
community... [24:37]

AL: Sure. [24:37]

ADI: ...and changing. I think were people that... were going to feel confident... and youre
not going to appease everybody. Ive always used, whenever Ive done the Bitcoin space, as
a 90%. I try to do everything, whether it be what I did with the Alliance, what I did... I want
90% plus to approve. If you cant get that kind of approval, youre going to be fighting
uphill. I think weve got that and I think weve got the encouragement from the community.
Youre going to get people that arent onboard but well do the best we can to be fair. I
think thats what were going to do. *25:07+

AL: Im going to continue to press you on this, Anthony, just on a slightly different angle.
The other argument against doing something like this is that you, essentially, again... it
depends on how large this is, so I could be completely out of line here... but the other
concern is that you create a situation where the people who are working on the project
have a situation where, win or lose, with the project... theyre good because they got all this
money up front that they could use as money during this exciting period. I think that thats
the... anyways... Im sorry, I am a squeaky wheel. That is the definition of what I am and I
really do try to bring that to every project that I involve myself with because I complain
about a lot of these things before other people do. [25:45]

ADI: I appreciate you doing that and its you doing that thats going to be better and make
us... if we can appeal to someone like yourself and youve already said you already feel a lot
better on the ways things have gone over the last few months. Thats great. I encourage
that and I think the whole team encourages talks like this. [26:03]

SM: Adam, I was wondering is your issue with the different set of rules for certain people or
is it with the idea that certain people are getting paid? It sounds like youre issue is with the
fact that its built into the code that there are different rules for some individuals. *26:19+

AL: Yes. At the core of my issue here it is that I feel like any time you set up special rule
systems for whoever, and whatever the intention is, it just muddies the water. It just makes
it so that now its not a simple situation. Im doing the same thing with LTBCoin. With
LTBCoin, were figuring out how were going to vest people initially in it and thats probably
going to look a lot like what Ethereum is doing here. I have all these same problems and I
have all these same concerns because, ultimately Anthony, youre one of eight founders and
the team thats going to be getting the distribution is 50, but there are a lot of you making
this decision, whereas with our project, a lot of these core decisions Im trying to outsource
as much as possible but I have to make a lot of these decisions myself. Im very conscious of
the optics issues and really trying to figure out what the best path forward is because
everybody is trying something different and I cant figure out which one is right. You guys
have been really successful at building and vesting stakes and I think the Wholon idea is
fantastic. Again, just the fact that you guys are showing up on conference calls and doing
the outreach stuff is more than... nobody else is doing that. That is the most important
thing here. I just feel like it would be such a shoe in if it wasnt for this one level of added
complexity that makes it so I have to worry about that part. Again, like I said, Im a squeaky
wheel. [27:33]

ADI: I understand where youre coming from and weve had a lot of debates and a lot of
discussions. When youve got eight people on the leadership team, youre going to have
both sides of it. Were at a comfortable point actually. I think the most comfortable weve
ever been as the eight because you have some people on one side (?? Inaudible) and
people on the other (?? Inaudible) to the point where everybody seems to be happy. I think
were pretty comfortable. *27:55+


___________________________________________


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for March 25
th
2014. If youve been into the Bitcoin Talk forums lately, you may have
noticed that the Nxt thread is now more than 2,500 pages long. The Nxt community uses
this thread to discuss everything from Nxt core features, to philosophy, to the true identity
of BCNext. Its a thriving discussion but its a little hard to follow if youre only interested in
one topic. New forums dedicated to Nxt have been set up at www.Nxtforum.org. It looks
and feels a little bit like the Bitcoin Talk forum (thats intentional) but there are now
separate topics there for Nxt features, applications, marketing, tech support and more.
Check it all out at www.Nxtforum.org. For more general information on Nxt, head to
www.Nxtcrypto.org or www.myNxt.org and stay tuned for more news on Nxt on the next
Lets Talk Bitcoin broadcast. *29:08+


___________________________________________



AA: The last week or so, maybe a bit more than a week, Ive been playing around with the
proof of concept test blockchain on Ethereum, been mining Ethereum, I have more than
4,000 Ether right now, which I mined on my laptop. By the way, its testnet Ether so its
worth nothing. It allows me to build contracts, and fund those contracts, and send
payments back and forth, and then try out the code. Im currently playing with the high
level language which is C like. Ive played a bit with Epsilon but Im not a huge fan of
Epsilon. I know thats heretical to say among programers but I prefer procedural languages
for things like this. Ive been playing around with it, and building a few contracts, and doing
fancy things and really enjoying it so far. I think its definitely been a very interesting
learning experience because its just so radically different than everything else weve seen
before. Every other blockchain technology weve seen before is pretty much a clone of
Bitcoin and single focused. Ive found it very, very interesting. Hows progress going
towards a final release? Do you see incremental releases going on for a while up to the
point where you get the final release in Q4? [30:25]

ADI: Yeah, thats the plan. Thats also another reason why we didnt launch a month,
month and a half ago was because we thought it would be a great idea to have something
that someone can actually try and have a proof of concept out there that people could toy
around with and see that we have something tangible, and then take it to market. Were
looking at... I still think Q3 or Q4. Until then, I believe there will be incremental releases.
[30:50]

AA: It sounds good. Im looking forward to continuing to work on Ethereum and, basically,
learning from it. I think, as with the blockchain coins, I think youre going to eventually have
some alts pop up in that space too, which is probably a really good thing for competition,
and feature picking, and testing, as it has been in the altcoin space. Weve learned a lot
from alts against Bitcoin. We certainly will learn even more with Ethereum. Do you find
that a promising potential? Do you find that a scary potential? How do you feel about alt
Ethereums? [31:26]

ADI: I think its great. Yeah, bring it on, I mean, whatever is good. A lot of people are
excited to get their coins put onto Ethereum and Ive got no concerns about other ones
coming out. If there is a competition, then thats fine. Its going to... just like Bitcoin. Im
great with it. I think Ethereum is amazing. I think if something else comes along, thats
great. Its just going to be pushing us forward overall. Thats all I really care about. *31:51+

AA: I would consider it the best form of flattery to have someone validate the idea that we
need a contract platform by building another one. (Laughter) [32:00]

ADI: For us, its about getting more and more people into it. We initially have started with
the product sale that we were going to be capping it at a certain amount. Weve since
decided were not going to do that because we want as many people to be able to purchase
Ether, at the beginning, as possible. I mean, what would happen if a couple of big fish would
go in there and just buy everything right up at the beginning. Weve left the model of the
product sale being uncapped. We just want everybody to be involved and everybody to
have a piece of it because thats where the community grows once you have skin in the
game. [32:30]

AA: Im interested in many of the applications in Ethereum that are simply not possible with
existing coins. I think many of the examples we see, in the early examples for Ethereum, are
things that are possible with other coins. Theyre currency focused, or theyre escrow
focused, or they are simple contracts that could really just be an altcoin instead. Im most
interested in the things that you simply cant do with a coin; that you need a contract
language to do; things like doing title and deed registry for real estate transactions, or will
and estate planning beyond the simple multi-sig and escrow capabilities. Those are things
that are simply radical enough that they cant be done with existing platforms and I think
thats where you start seeing the power of having this approach to contracts. *33:23+

ADI: I completely agree. Its going to open the doors to a lot of things and were confident
were going to be able to take it there. [33:31]

AL: Weve been talking about this for a while, this kind of plan for if you were going to do a
conference, what would you do differently, what would you do right. You are doing an
enormous conference. [33:40]

ADI: The event itself is 11-13
th
April. Its at the Metro Toronto Convention Center, which is
Canadas largest conference center. Weve got two tracks that will be going that can fit
about 500 in each room. Plus, we have an Expo hall which can fit about 1,000 people and
weve got 30 or 40 booths in there. Then we have a fireside chat room which is going to be
a more intimate setting and I hope that, Adam, you want to be involved with that and Kyle
from CoinTalk to be interviewing people on a much more personal nature. Weve got the
banquet dinner on the Friday. We really want this to be a community feel. Weve had some
that are more business oriented with the conferences and we want to be a good mix. Its
being put on by the community up here in Canada. Its a complete 100% volunteer basis
and any money that we do happen to make, if there is anything, will go back to the Alliance
here. Its been something thats been an easy sell for the speakers. I think weve got over
50 that are coming; people from different communities. Im really hoping that we can get
the speakers altogether to get that good community feel that I felt in Argentina, which is...
Im not sure if you concur, Andreas... but my favorite conference so far, in terms of the
community that was involved in that. [34:49]

AA: Yeah, without a doubt. [34:50]

ADI: Thats really the type of feeling I want to have with this. I had an excellent time in
Austin. It was a lot of fun; a lot of the same speakers will be in Toronto that were there. I
had a wonderful time. I think what I like about our venue is that its going to be a much
tighter venue, not in terms of space, but in terms of proximity to the talks. I think
everybody will have more chance to run into each other, which was one thing that I felt a
little bit awkward with in Austin. It was just the way that the rooms were separated and I
didnt get a chance to meet some people that I knew were there. I just couldnt find them a
lot of the time. I hope this is going to have a nice, smaller feel to it but I had an excellent
time in Austin though. [35:27]

SM: Anthony, I saw you once which I was kind of surprised at but I know we were both
there. (Laughter) [35:33]

ADI: I say to Andreas, Andreas, I think I saw you once right at the beginning of your first talk
and then that was it. [35:38]

AA: I was actually looking for you. I wanted to talk a bit more about things and it was
impossible. It was spread out but also very busy. At the same time, I think it was a great
conference. I really enjoyed it. It was up there with Argentina as one of my favorite
conferences of the last twelve months. I can tell you, Im really looking forward to Toronto.
[35:57]

AL: Bitcoins big but its not that big yet. *35:59+

ADI: Yeah and Im hoping that we can deliver on the... weve got Inside Bitcoins, is literally I
think two days before our event but I think weve got a great cast of speakers and I would
encourage you guys to come a day early and we can spend some time together, just in a
more intimate setting than, I think, weve ever been able to do. Im really, really excited
about it. [36:17]

SM: Im coming early and staying late. (Laughter) *36:19+

AL: Yeah, same here. [36:21]

ADI: Alright. [36:21]

AL: Anthony, one of the things that we had talked about last time that I was curious if it
managed to happen... you were talking about doing either a reduced cost... like part of the
conference where new users could come in. Did that ever manage to materialize? [36:35]

ADI: Yeah, were actually doing that. Weve got a free aspect. Everything that we do with
the Alliance has a free aspect to it, whether it be our membership, whether it be a
conference that we put on. On both days, weve had to add a second day just because of
the amount of people that were coming. Weve had, I think, 300-400 people register for the
free sessions, which is in the morning on the Saturday and now on the Sunday, where you
can come and learn about Bitcoin. I think its something similar to what you did, Stephanie,
in Austin. In fact, I want to talk to you about, perhaps, doing the same thing up in Toronto.
[37:01]

SM: Im game for it. *37:02+

ADI: Awesome. Its going to be about getting your first wallet; having experts that can
answer questions and then, theyll be able to go through the Expo hall. Yeah, we are doing
that free session. Weve got different levels of tickets for the events. I think our base price
for the tickets is $200, which gives you access to the two main speaking rooms and the Expo
hall, for the Saturday and Sunday. Then, we have the dinner, which I think is $275, so $75
on top of the initial price. Then, theres the VIP package, which is access to the VIP events,
including the fireside chat area and the speakers banquet dinner on the Friday night.
[37:36]

SM: Is there going to be anything to showcase all the great community spaces, like Bitcoin
Decentral? Is there going to be a tour or anything, or after parties there to show off whats
been going on locally? [37:48]

ADI: Yeah, definitely. Theres also going to be a Hackerthon. Were going to be running
that out of Bitcoin Decentral. Its about a ten minute walk between Bitcoin Decentral and
the Conference Center, so everything is nice and tight there. Well also be doing... there will
be some sponsored event parties on the Saturday night. On the Friday, with the dinner,
well probably be doing something in the afternoon at Bitcoin Decentral, so thats why Id
like you guys to get there early as well be doing cocktails and stuff and then walk over to
the Conference Center. On Sunday, well be doing... (??) artshow thats going on during the
event, where artwork will be created during the talks when theyre going on and then well
be having an auction on the last day. [38:26]

AL: Awesome. [38:26]

ADI: Something similar to what they had with the auction in Argentina. Any artwork thats
left over, well hang around Bitcoin Decentral and people coming to the meetups will have a
chance to buy. It will all be Bitcoin-themed work. Its about doing these little different
things and I hope that were going to accomplish that. *38:42+

AA: I really like what were seeing right now, which is conferences started up by the
community, focused on the community needs and focused on building stronger community
by getting people to network, rather than focused on raising money or discussing the return
on investment based on capital allocation by venture capital firms unless the regulators step
in... Oh my god, Im already falling asleep just talking about it. (Laughter) These
conferences are so much more fun and so much more interesting. You get to talk about the
cool technology, you get to meet the programers, you get to meet the people who are
building new and exciting innovation and, if youre lucky, you dont get to meet any of the
investor class, so its really great. *39:28+

ADI: Its about balance, Andreas. Youve got to have both in these things and, for me, the
more the community part of this, its the better. I think thats what were going to be
attracting. [39:38]

AA: We didnt have balance in some of the recent conferences and I found that very, very
boring. Im not worried because if you have a vibrant community event, the investor class
will show up, if nothing else, just to mooch off the innovation. You cant have an event,
where only the investor class shows up and the community stays at home. Thats a terrible
event to have, so Im really glad that were seeing the spirit of the community being shown
in these events and getting a much more vibrant event as a result. [40:12]

ADI: Its been my goal since day one to do that and thats one of the reasons why I even
travel to global conferences just to really see how we can do things and make a spectacular
event for the community. [40:22]

SM: All the ones Ive been to, so far, have had good things about them and worse things
about them, and sometimes the balance tips more toward the good and sometimes more
towards the worse, but you can learn from of them and make a better event. [40:34]


______________________________________________


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______________________________________________



AL: Anthony, recently the Bitcoin Foundation has been in the news and the news hasnt
been so great. Its kind of been interesting because its not really the Foundation so much
as some of the core members of the Foundation who have been finding themselves in hot
water. Your earliest project was, and continues to be, the Bitcoin Alliance of Canada. Weve
talked about some of the problems with the Foundation before. Im curious do you have
any thoughts or comments on whats going on there now? *42:49+

ADI: I take it as when you are involved in an organization like that is that its representing
something that is disruptive technology. At any time, someone thats involved in that is
having issues, its definitely not a good thing for Bitcoin. I sometimes dont want my phone
to ring because it tends to be the press calling and telling me something I hadnt known yet
and they want to take half my day now to start talking about that. Weve got to move
forward from that and I think theres great people coming into the Foundation. Im always
eager to work with them and I think theyve just announced in Canada that theyve got their
interim board of directors. I think theyre working closely with the Montreal embassy. I
hope to have more discussions with them. There are people that are doing an amazing job
with the Foundation and well get some more people in there and I think its going to be just
fine. [43:46]

AL: You think that over the long term the Bitcoin Foundation, once they restaff up and
recover, is going to be a relevant organization moving forward? [43:54]

ADI: I do. I dont think theyre going to disappear and I think theyve probably made some
moves recently because of whats happened and that is going to strengthen what theyre
trying to do. I hope they succeed. I mean, the better that they can do, the better were all
going to do. Im a member of the Foundation and I want them to succeed. I want to see
more good press coming out. This will, hopefully, push them more to get where they want
it to be. [44:18]

AL: Where they want to be is an interesting question. One of the points of contention
about the Bitcoin Foundation has been what kind of an organization are they, because I also
am a member but that hasnt really mattered too much about being able to understand
what the Bitcoin Foundation really is. There isnt much more clarity when youre a member
than when youre not. Specifically, the Bitcoin Foundation could be a trade organization,
where they represent industry and then theyre only representing the industry members
who are choosing to be members. Thats a pretty standard type of organization. Theres
kind of this broad perception in the community thats been around just forever... I dont
know if anybody has even encouraged it... that the Bitcoin Foundation represents the
Bitcoin community. The Bitcoin Foundation has never really come out and explicitly said...
their website doesnt say We are not the voice of the Bitcoin community. It doesnt say
that so, Im asking what do you think the Bitcoin Foundation wants to be? Also, what do
you consider the Bitcoin Alliance of Canada, relative to those two options? [45:14]

ADI: I think from day one, the Foundation has wanted to represent Bitcoin. I think that was
their goal that they were accepting memberships from around the world. To me, that is
that they wanted to represent Bitcoin and they wanted to do it internationally. I think thats
fine but I think they have made some mistakes initially that has led to an imbalance and
people that felt that they werent included in a lot of things. From that, weve got great
leaders that have got together from other organizations and formed the Global Bitcoin
Alliance, which has just launched in Germany, last month. Its actually a great thing thats
come out of the affiliate plan and structure of the Foundation, is that national organizations
have come together. We want to just share resources, share the best practices, share the
models that weve done and gone through and help facilitate and speed the growth of
communities worldwide. I think the Foundation have wanted to represent Bitcoin from the
start. I think they made some mistakes, initially. I think it can still be fixed and I think it can
work with national organizations too and we can all just work together for the common
goal. [46:19]

AL: Now, you mentioned that we can work with national organizations but I just heard you
mention an international organization that sounded like forming out of Germany that I
actually, have not heard anything about. You said this happened last week? [46:31]

ADI: No, it actually happened last month at the event in, I think... it was in Berlin. [46:36]

AL: Ah, interesting. [46:38]

ADI: Yeah. The Global Bitcoin Alliance came about from national organization leaders, such
as myself, meeting at conferences and we want to set up a very loosely knit organization
that is just sharing resources. Theres no contract between each other. Anybody can be
part of this. You can be at meetup group. Were just going to be a resource for events; well
be a resource for best practices. Actually, at the Expo in Toronto, theres going to be some
tracks for the Global Bitcoin Alliance that will guide people how to set up communities. This
is what weve done and we dont want people to have to reinvent the wheel. We want it to
be nice and easy but we dont need to have a tie to each other with any type of contract.
We can just say Hey, we are going to be open with each other, well be transparent, well
share, well be inclusive of anybody who wants to be there. You dont need one
organization from one country. Its better to have multiple organizations. Lets get
everybody involved. Were very loose; we only basically communicate when were just
sharing Hey, what happened to you guys last week, or do you find that a better process at
the meetup group. Were going to develop processes and best practices to form
communities around the world. Thats our focus. I dont see ourselves as a lobby group or
anything like that. Were just a group that is going to help form larger Bitcoin communities.
[47:53]

AL: Is it safe to describe this as an international alliance of national alliances? [47:58]

ADI: I call it a collaboration of independent groups. [48:02]

AL: OK, I like that. Can you contrast that to the model that the Bitcoin Foundation is
approaching other... because theyre trying to become an international organization too?
[48:12]

ADI: Im one of the founders of the Global Bitcoin Alliance with teams from Argentina, from
Israel, and a bunch of other countries that came together and thought that something like
this should be started. It came about, actually, with the Foundation trying to set up these
contractual agreements with national organizations that are out there and we didnt think
that that was the best way to go about things. Through some discussions, we thought of a
better approach which we liked, which is to be very, very loose and not needing any of these
type of documents and just sharing resources and best practices. Thats where this came
about. I am involved with it. Its not going to have the... I dont think, the effect of the
Foundation, in terms of scale. Were just here to know that were partnering; that we all
agree that just for the better interest of building these communities of Bitcoin. Lets work
together; lets collaborate. Yet, we need as many points of separation as possible. *49:05+

SM: Yeah, I think thats really important because what youre doing, effectively, is
decentralizing something like the Bitcoin Foundation, whereas they are a pretty centralized
organization and sometimes are even, sort of, misunderstood by the public as representing
Bitcoin. I dont think you would claim to be about that, at all. This is just a networking thing
where anybody is welcome to join and well see what comes out of it. I think thats so
important because a lot of the best projects and opportunities come out of those
networking opportunities. Kudos to you for that. [49:42]

ADI: Also, I want to make sure were clear too. The Foundation, if it wasnt for the
Foundation, I would not have been, probably, building the communities that Im doing. Ive
learned from what theyve done and they were first to market. Of course, maybe they
made some mistakes and thats fine but theyve done a great service to me and Ive learned
to be more open with the models that were doing. I really have a lot of respect for the
people that are working there right now. I do communicate with many of them now. I think
theyve learned as well and through communications and the outreach to these different
national organizations and said, perhaps you guys are going about these affiliate programs
isnt right, or it could be done a little bit differently. I think theyve learned from that and
theyre willing to adapt, as well. Ive seen changes. Im really happy that they exist. I really
am. I think they have done a lot of great things for the community. I think that they helped
me to get where I want to be and I look forward to working with them in the future. I am
optimistic for the Foundation. [50:40]

AA: I see the Foundation as two distinct things. One, kind of, as a professional association,
which can coordinate some responses to public policy issues, talk to people and, without
any authority really, just act as a source of information. Then there is the leadership team
and I think on the leadership team, there are some serious, serious problems, conflicts of
interests and some very big issues that need to be fixed. I do see, at the same time, there
are a lot of very, very talented people involved at different levels within the Foundation
doing work within various working groups; whether thats in the Foundations Education
Committee; whether thats in coordinating speakers for conferences, not Bitcoin
conferences necessarily but making sure that conferences are attended by qualified
speakers and providing a contact point for conference organizers, who dont necessarily
know how to navigate the community very well - all of those functions. Recently, I agreed
to join the Foundations working group on dealing with poverty issues through Bitcoin. They
dont have a name for the committee yet. Various names have been suggested but its
basically focused on financial inclusion, economic development, measures against poverty,
dealing with issues such as remittances and micro-lending. Id like to call it the Committee
for the Other Six Billion, which has been a passion of mine since the beginning in Bitcoin and
something Ive talked about a lot. I joined that working group as the Chairman in order to
foster some development of those concepts and see where we can apply some good
thinking among some very talented people who are doing working in that space. There will
be some announcements coming out of that. Im involved with the community now in a
couple of different ways - firstly, because Im a member, secondly, because Im part of this
specific working group and thirdly, because I do sometimes go and speak at conferences at
the invitation of the Foundation. For example, when I went to Greece and did the Disrupt
Conference, that was at the invitation of the Bitcoin Foundation. For that purpose, I think it
serves its goals well but I draw a very bright line between the working group and the
membership and the leadership issues. Ive been asked to join the Board. Ive been
nominated for the Board and I have absolutely no interest in getting involved in that layer of
management or leadership in the Foundation, primarily because I think some of the existing
people and structure of that Board, as well as the by-laws that determine the rules by which
that Board works, are broken very broken. Im focused on working in the parts of the
Foundation that actually work well. Anyway, so thats my contribution to the Foundation.
Ive got mixed feelings but Im trying to keep my work focused on the places where I can
have an impact and stay away from the places that I think are slightly toxic. [53:45]

ADI: I think that name is excellent though Committee for the Other Six Billion; thats
perfect. [53:49]

SM: What exactly are you hoping to accomplish? Do you think that some organizations will
come out of the working group that will actually address these issues... like micro-lending
institutions? What do you see happening from this? [54:04]

AA: Well, thats still up for discussion and part of my job is to get the right people. I think
people who are committed and active in that space, to sit down and talk about these things.
Im working with some of the well known charities in the space and some of the people who
are working on issues such as remittances, and micro-lending, and things like that... things I
think will have an impact. Were trying to discuss what exactly can this working group do. I
can tell you the one thing that has become very apparent is that our focus will be on
decentralized solutions. Were not looking to find some big wealthy NGO and persuade
them to jump on board with Bitcoin. Thats a centralized approach. Were looking for
decentralized solutions and perhaps, at first, all that means is putting together some reading
materials that describe scenarios or use cases, where Bitcoin can be used and say This is
how you would use Bitcoin in a remittances scenario. This is how Bitcoin could help in a
micro-lending scenario. I think, at first, just informational content would be a great first
goal and then well take it from there, with the emphasis always, always on decentralized
solutions to this problem. [55:20]

AL: One of the interesting things about the Foundation though, that Ive kind of noticed, is
that it seems like a lot of their problems kind of revolve around the fact that they are kind of
centralized and that because of that, the Foundation, and specifically the leadership that
youre talking about, can be a bottleneck for actually doing any good work. I think the
reason why the Foundation... [55:37]

AA: Oh yeah. [55:38]

AL: ...is important right now is because they have a bunch of money, right? [55:40]

AA: It was foundationally compromised from the very foundation by being centralized in a
decentralized currency the structure, the by-laws. It is a poorly structured, hierarchical
organization with stifling rules designed for a pre-decentralized era, which has... its almost
antithetical to the very essence of Bitcoin, the way its organized. It completely sucks. The
problem is that it still is there and we have to deal with it. Im hoping that we can see some
changes in leadership and I hope those changes in leadership can go in and radically modify
the by-laws and make it a much more open, much more decentralized, much more member
focused, much more global organization, or simply remove a lot of its activities and allow it
to act more as an umbrella for regional organizations, in a much more decentralized fashion.
Either way, its going to need some radical changes otherwise quite simply, its going to be
pushed into irrelevance and oblivion as other, more effective, more decentralized, more
scalable, more active organizations take root and start producing outputs and producing
value. I think youre going to start seeing that with some of the other... you know, the
Global Bitcoin Alliance and the various associations that are popping up. Those are in direct
response to a need thats not being met and to problems that exist in the existing system.
[57:08]

AL: I think that thats a really interesting point and its one that Ive been very happy to
make about MtGox a number of times, really, at any available opportunity is that this thing
that has companies fail or has... again, talking about MtGox, has companies fail and
sometimes repeatedly. In the case of the Foundation, because again, they have these kind
of core issues that were set up at the beginning, each of these projects has catalyzed its own
eventual competition. Theres always an opportunity to right the ship. Theres always an
opportunity to change things but once youve spurred competition, the competition doesnt
stop just because youve fixed stuff. The situation that we have now, like Anthony was
saying, really is directly because the Foundation had these kind of obvious flaws that
became more obvious as time went on but people figured it out and started working on
solutions. Its very interesting to me. *57:59+

AA: Its the little grain of sand that starts the crystallization of the competition around it but
I love the fact that you pointed out the comparison to Gox. I would say the Foundation is
the empty Gox of professional associations in Bitcoin. (Laughter) Its problems go directly
back to a complete failure of leadership - completely closed, insular, arrogant, sheltered,
uncommunicative leadership, part of which was Carpeles himself but theres another couple
of relics left on that Board that pursue the exact same approach with their leadership. The
Foundation is the Gox of foundations. In fact, Im surprised that it didnt blow up in the
wake of the Gox scandal because there were a lot of significant conflicts within that
environment. Unfortunately, the problem is that the very people who are at the heart of
this problem have the least amount of awareness and are not about to resign and walk off
and allow the Foundation to become a more effective organization, and to revise its rules,
and to reform itself. Thats not going to happen from the inside out. Thats going to require
pressure. Im actually a big fan of getting many of the industrial members... sorry, industry
members... (laughter) of the Foundation to start tugging at the strings because they can do
that. They have the power to do that and to say Look, enough is enough. Step down,
reform, fix yourselves or were just going to take our stuff elsewhere. The Foundation
without its industry members is just the individual members, and theyve ignored them for a
couple of years quite effectively, so theyd walk very happily. *59:51+

SM: I guess this brings up the age old philosophical question of working within the system,
versus just going outside the system, or starting something new. [1:00:05]

AA: Both! [1:00:06]

SM: Mhmm. [1:00:07]

ADI: As many as possible. [1:00:09]

SM: I know that the Foundation has funding, right? Theyve got a certain amount of name
recognition, and so forth, so theres going to be an advantage to working with them there
but it sounds like you dont think that they are irreversibly broken, Andreas. It sounds like
you think they can be reformed and could get on a better track. Is that right? [1:00:30]

AA: I think theres a possibility and I also think that, in the meantime, they do provide a
vehicle for promoting the things I care about, like the working group for the other six billion,
just because of sheer inertia. However, Stephanie, I would say one of the things that are
interesting is, you said theyre funded. They certainly have received many funds. Where
are those funds? Who controls those funds? [1:00:57]

SM: Yeah, thats a great point. [1:00:58]

AA: When were they last audited? Are they actually solvent, or have all of those funds
disappeared into a big, black hole? Just remember who was in the leadership until recently,
who is in the leadership today and what their track record with ethics has been, and I would
suggest that I would be not surprised at all if the Foundation implodes in a giant
embezzlement problem some time down the line, or funds get stolen within quotes, or
without quotes, and something like that. I mean, its bound to happen because these things
dont happen because of technical failures, they dont happen because of bad actors, they
happen because of failures of leadership. The Foundation is the very definition of a failure
of leadership and therefore, these things will happen to them eventually. Its just a matter
of time. I think thats one of the reforms we need to see. If that doesnt happen, youre
going to see a blow-up probably. [1:02:04]

SM: Youre not worried about being associated with that if a blow-up does happen?
[1:02:09]

AA: Again, Im keeping my involvement to a very, very specific thing. Im a member and Im
on a working group an unpaid, volunteer working group thats composed of people who
are not even members of the Foundation, necessarily. It receives no funding and sends no
funding to the Foundation, so the only thing we have is the organizing name. Ive purposely
kept my involvement to that, despite multiple requests to join the Foundation to become...
to be nominated for various positions. Im not interested and part of the reason Im not
interested is because I dont trust the structure that it has today, or the leadership to be
able to deliver ethical leadership and predictable results. I fear that there will be a crisis.
Yeah, Im trying to use the Foundation as much as I can to promote the things that are
important to me and then, beyond that, Im keeping arms length. *1:03:09+

ADI: Yeah, Im in the same position. Ive been approached, as well, to be doing work with
the Foundation but Ive decided not to, I think, for many of the same reasons. Maybe being
on a committee or on a group might make more sense. I think thats something for me to
think about too, Andreas. [1:03:27]

AA: Exactly. Keep in mind, there are a lot of people within the Foundation, who work in the
Foundation, who are ethical, responsible, hard-working, principled people. The problem is
that when you work for an organization thats rotten from the top, they get chewed up.
Theyre going to get tainted by this association, even though theyre not at fault. Already
we saw that, I think probably, Matonis, who came in as a breath of fresh air a while ago, has
now been effectively tainted by the latest scandals and people were calling for his
resignation, even though Matonis had been the answer in the past to the leadership
problems and had provided some reform and fresh approaches. Thats going to continue
happening because until you fix the real problem, its just going to start tainting everybody
else who comes into contact with it. You have to be very careful how much you get
involved. [1:04:33]

AL: OK. (Laughter) [1:04:34]

AA: By next week, Ill probably be fired from the working group. (Laughter) *1:04:38+

AL: I was going to say, itd be like *** Andreas, do you want to just go ahead and insult
Peters mother or something? (Laughter) *1:04:43+

ADI: Yeah, wow! I was really trying to choose my words carefully. [1:04:49]

SM: Thats what people like about it though. *1:04:53+

AA: Youve heard this show before, right? *1:04:55+

ADI: I have, I have. [1:04:57]

AL: Its true. Thats actually the best thing to do, Andreas, in this situation because you are
affiliating yourself. Stephanie is totally right and you, again I think, articulating this stuff at
the beginning, its not going to endear you to them, but theyre not inviting you because you
have endeared yourself to them. They are inviting you because you have legitimacy that
they desperately need, just as Matonis had a ton of legitimacy and had that basically all
leached away from him just through this association. No, I think that again, I also was kind
of concerned. [1:05:23]

AA: I still respect John... and I still respect John and I think... [1:05:26]

AL: I still respect John too... exactly. [1:05:28]

AA: ...hes done a great job but unfortunately, yeah, he got splashed by the effluent.
[1:05:34]

AL: I think that that is very appropriate for you to be very clear about what type of role
youre taking there because, at this point, it has become kind of a toxic organization (I say,
as a member of that organization). [1:05:43]

AA: Lets make it clear. Its not just about individuals. The problem with a foundation is not
just about individuals, although there are some very problematic situations with some of
the individuals. The problem is the structure itself, the rules and by-laws of the Foundation
are broken and they will create concentrations of power and hierarchical stress points in the
Foundation that both attract and reward bad behavior, and then ossify that bad behavior so
that it cant be excised by the members. The members in the Foundation have no power.
The founding members of the Foundation have more power than the Board, and as a result,
it creates tremendously unbalanced, non-responsive, non-representative organization that
is far too concentrated and hierarchical. Its as if you try and you say Here is a
decentralized currency. Whats the worst, most unresponsive, most hierarchical, most
concentrated power structure we could put on top of it. Oh great. Lets do that. *1:06:47+

AL: OK. Why dont we do it better? Again, I know everybody has a billion projects but the
Foundation, last time I checked, had 1,200 or 1,300 members. We have orders of
magnitude beyond that, and 80% of our listeners are based on the US. If there is no US
competition... again, it just seems like youre throwing time behind this anyways. I did, six
months ago, and then I kind of felt like my efforts with the Foundation werent really... it
just didnt feel like anything was being accomplished. Anyways, clearly this is way off topic
for the show but it just seems like this is such an obvious explosion thats coming, such an
obvious problem that appears to be unavoidable, no matter what we do because its just
built into the rules that this thing is going to blow up. [1:07:31]

AA: Yeah, were going to get Goxd by the Foundation eventually, if we dont fix it first and
thats going to be unfortunate for Bitcoin. Im really hopeful that other organizations that
have started evolving will put pressure on this but honestly, I think the only recourse, at the
moment, in this particular organization read the by-laws and the way to address issues in
an organization is to learn the rules better than the people who, supposedly, run by the
rules inside the organization and then, beat them over the head with the by-laws. I think
thats a very effective trick. Read the by-laws. Effectively, at this point, the only group that
has any power are the industry members. [1:08:14]

AL: Well, with that in mind, I think that were going to wrap this episode of Lets Talk
Bitcoin. Thanks to Andreas, Stephanie and Anthony for being on today, guys. This was a lot
of fun and a very interesting, meandering conversation that we had here. [1:08:25]

ADI: I really enjoyed that, thanks a lot. [1:08:27]

SM: Yeah, I think this is important to talk about. I dont disagree that its off topic. I think
its very important. *1:08:32]

AL: I didnt say it was off topic, just meandering. (Laughter) *1:08:35+

AA: Alright. Im going to go take off my snowboots and brush my teeth because my mouth
tastes of snowboot right now. [1:08:44]

ADI: See you guys in three weeks or sooner if anybody is going to CoinSummit? [1:08:47]

AA: Yes, Ill see you in CoinSummit. *1:08:49+

SM: Awesome. [1:08:49]

AL: Yeah, Ill see you in CoinSummit too. *1:08:50+


__________________________________________


CREDITS:

Thanks for listening to Episode 95 of Lets Talk Bitcoin.

Content for todays episode was produced and edited by Adam B. Levine and Denise
Levine, and featured Andreas M. Antonopoulos, Stephanie Murphy, Anthony Di Iorio
and Adam B. Levine.
Music for this episode was provided by Jared Rubens and General Fuzz

Any questions or comments? Email adam@letstalkbitcoin.com

Have a good one! [1:09:16]