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When Square’s boss Jack Dorsey talks about hyperinflation, the world listens. And Twitter reacts. Since so-called developed economies are now feeling the pain that inflation brings, the concept is in everyone’s mind. Every human has a front-row seat to witness the consequences of the United State’s relentless money printing. And, since the Dollar is still the reserve currency of the world, they’re all feeling it too.
Related Reading | Bullish For Bitcoin: US Inflation Expectation Breaks Out From Decade Long Downtrend
This is Jack Dorsey’s tweet:
Hyperinflation is going to change everything. It’s happening.
— jack⚡️ (@jack) October 23, 2021
As you can see, he doesn’t merely talk about inflation. He goes for “hyperinflation,” which caused adverse reactions in the replies and the quoted tweets. They accused him of fear-mongering and quoted official numbers at him. And the nay-sayers probably have a point here, because the US is far removed from the reality that word implies. However, one thing’s for sure: money printer goes brrrrrrrr… and it hasn’t stopped working since Covid hit.
This is an example of an unnecessarily insulting response from a traditional finance person.
2/ step back and it’s disturbing that a lot of most powerful financial figures/oligarchs are invested, literally and figuratively, in various huckster schemes and libertarianish fantasies of state and civilizations collapse.
— Josh Marshall (@joshtpm) October 23, 2021
This man has obviously not done his homework regarding Bitcoin, so his argument is invalid. And doesn’t require a response. Plus, he’s being insulting to get attention, which he got. So, good for him and his dopamine levels. Let’s hope he has fun staying poor.
This is a Venezuelan economist with a moderate answer to Jack Dorsey.
I don’t think it will. But it doesn’t need to happen for things to get ugly. https://t.co/Cj85mJ8o7x
— Eduardo Gavotti (@EduardoGavotti) October 23, 2021
Since Venezuelans have first-hand experience with hyperinflation, let’s take what he says into account. The US is just feeling what inflation does. So-called developing economies live with that concept on their backs every second of every day.
BTC price chart for 10/23/2021 on Bitstamp | Source: BTC/USD on TradingView.com
The Human Rights Foundation’s Alex Gladstein, a notorious Bitcoin maximalist, had this to say to Jack Dorsey.
Those shocked by this tweet live in a bubble of financial privilege.
*1.3 billion* live under double, triple, or quadruple-digit inflation: Turkey, Nigeria, Ethiopia, Iran, Lebanon, Venezuela, Cuba, Sudan, and beyond.
It’s already one of the world’s biggest humanitarian crises. https://t.co/P83opDagdu
— Alex Gladstein 🌋 ⚡ (@gladstein) October 23, 2021
He’s not lying. Hyperinflation is “already one of the world’s biggest humanitarian crises.” However, the US is far away from “Turkey, Nigeria, Ethiopia, Iran, Lebanon, Venezuela, Cuba”, and Sudan’s situation. And, since the Dollar is still the reserve currency of the world, they have a comfortable cushion to resist the constant money printing’s effects.
Serial entrepreneur and former Coinbase CTO, Balaji Srinivasan, answered Jack Dorsey with a fully-fledged idea. A “censorship-resistant inflation index.”
I wrote a spec for a censorship-resistant inflation index. It’s framed for a startup, but Square could easily do this. In a crisis, accurate inflation info would be something people checked Twitter for every day. @milessuter @moneyball @jack https://t.co/SYb2mfxjex
— Balaji Srinivasan (@balajis) October 23, 2021
In the project, he brings forth some hard truths:
“If inflation is a government-caused problem, we can’t necessarily rely on government statistics like the CPI to diagnose it or remediate it. Indeed, in places with high inflation, censorship and denial is the rule rather than the exception.”
If you are technically capable, there’s still time to send your proposal and earn “A $100k Prize for a Decentralized Inflation Dashboard.” Be aware that “if you use Chainlink’s oracle tech in your project, the best dashboard will be eligible to receive a $100k grant in LINK tokens.” Those tokens are in addition to the main prize.
In a Twitter Spaces room specifically dedicated to Jack Dorsey’s tweet, notorious podcaster Preston Pysh concluded.
“I think people’s understanding of the terminology, deflation, inflation, is just grossly misunderstood. And so, when you say we’re going to have these deflationary events that are then going to lead to more QE, which is then going to result in more inflationary events. I completely agree with you, but we’re talking that there’s so much information loss in such a simple word as deflation and inflation. So the deflationary event is that this whole system is constructed as credit.”
When he says QE, Preston refers to Quantitative Easing, which Investopedia defines as:
“A form of unconventional monetary policy in which a central bank purchases longer-term securities from the open market in order to increase the money supply and encourage lending and investment. Buying these securities adds new money to the economy, and also serves to lower interest rates by bidding up fixed-income securities.”
Related Reading | Jack Dorsey Plans to Build A Decentralized Exchange For Bitcoin
That being said, Preston asks:
“How many people in the US, or in the world, have that context when that’s not their expertise, right? They didn’t get a major in macroeconomics, or finance, or whatever. So, it’s just all buzzwords that people throw around. And, in the meantime, no one really even understands what those definitions even represent.”
For more information about inflation, check out the Bitcoinist Book Club analysis of Saifedean Ammous’ “The Bitcoin Standard.”
Featured Image by Gerd Altmann from Pixabay - Charts by TradingView
Watch This Episode On YouTube
Listen To This Episode:
The government of El Salvador recently made a historic move by declaring bitcoin as legal tender, but the implementation of this new monetary network on the nation-state level hasn’t come without its fair share of obstacles. Alex Gladstein, chief strategy officer of the Human Rights Foundation, recently wrote an outstanding piece called “The Village And The Strongman” detailing the state of Bitcoin in El Salvador, and he joined a Twitter Spaces hosted by Bitcoin Magazine to discuss exactly what’s been going down.
One of the main issues with the government implementation has been a lack of privacy and transparency surrounding the Chivo app. By moving toward a cashless society, there is potential for citizens’ financial behavior to be surveilled and restricted if they don’t learn Bitcoin best practices for privacy and self custody.
“There’s a bit of a concern here that you could have a lot of users flock to the government wallet, because it gives you free money, and it’s easiest to use,” said Matt Odell, Bitcoiner and privacy advocate, during the Spaces conversation. “As a result, they end up having no financial privacy, and their funds can get seized at will, which is the current situation if users are using the Chivo wallet, the government wallet.”
Complications have also arisen from new users being introduced to bitcoin’s inherent short-term volatility. Bitcoin’s price suffered heavily on the day of launch, which was likely jarring for people who don’t understand why their purchasing power may be decreasing.
“They see their balances going down and they feel that the money has been stolen” said Enzo Rubio, owner of Point Break Café in El Zonte. “It’s difficult when you don’t have the right education. I think education is one big part that the government is not doing right now. Possibly, because they are trying to fix the technical difficulties a bit more than the education part.”
Ultimately, the benefits of adopting a monetary network that can grant people unseizable property rights outweigh the turmoil that has occurred during the rollout. Bitcoin represents hope and opportunity, especially for the younger generation that is embracing this new technology and all that it has to offer.
Gerson Martinez, a Salvadoran Bitcoiner whose father had to leave El Salvador at 19 years old because of civil unrest and corruption, is excited and hopeful for the next generation of Salvadorans.
“It gives me so much joy and pride in my heritage to know that there’s young people, in particular, young people, who are so hopeful about their country now, and that the first thought isn’t, ‘Let me get out of here. Let me figure out how and when I can get out of here to go look for a better life,’” Martinez said. “Rather, ‘I can build the life that I want here.’ In my view, having adopted this monetary network is a gigantic step in that direction towards freedom and sovereignty. I’ll leave it at that.”
Gladstein reinforced his position that this move by El Salvador is unprecedented and will likely incite action from other world leaders around the globe.
“I want to be clear that from my perspective, this is a historic thing. It is the march of open-source software,” Gladstein said. “It is remarkable that this government chose Bitcoin. They could have banned Bitcoin. It really puts the pressure on a lot of institutions internationally and corporations to get with the program.”
The full recording of this Spaces conversation includes many more details and discussion. To read the whole conversation, check out the unedited transcript below:
[00:00:06] CK: Welcome, welcome, welcome everyone. This is ck_snarks with Bitcoin Magazine. Got a good Twitter Spaces all set up for you. Really excited for this one. It’s going to be with Alex Gladstein. we’re going to be talking about what is happening in El Salvador. Bitcoin is obviously happening in El Salvador, but a lot else is happening there. Alex wrote an article for Bitcoin magazine titled The village and the Strong Man, really diving into the unlikely story and talking about how Bitcoin in El Salvador became a thing to begin with. Also, the character of Bukele, what’s happening around human rights there, what’s happening around democracy there, etc.
It’s a nuanced, complicated subject. We’ve been talking about El Salvador a lot here on Bitcoin Magazine. Obviously, something that is very, very pertinent to Bitcoin and very big news. Want to continue to continue covering this. We are a little early here getting the room started, but waiting and excited for Matt Odell, for Aaron Van Wirdum, for several other folks to join in and lead the conversation along with Mr. Gladstein. What’s up Aaron? Hey, just for everyone who is unfamiliar with Aaron, he is our lead technical writer, and he is on the ground in El Salvador and pretty much has been since before the news of the Bitcoin law.
[00:01:35] AVW: Hey, hey.
[00:01:36] CK: Aaron, in between the Bitcoin legal tender law became official at Bitcoin 2021, you went to El Salvador, just because it was starting to really become a place, El Zonte in particular, for folks to make a pilgrimage. Can you talk a little bit about how El Salvador has really changed from before the law and after the law? As well as Bitcoin 2021 and that experience?
[00:02:05] AVW: Well, you mentioned that it has become a cool spot for Bitcoiners to visit El Zonte in particular. I’ve spent some time in El Zonte. I spend more time in San Salvador. I’m in San Salvador now. I’ve described it as like a rolling Bitcoin conference almost. You can go there, and more often than not, there will be other Bitcoiners in town that you can have a beer and just the types of conversations you’ll find at Bitcoin meetups. That’s cool. I don’t know what you mean with the last question. In fact, I don’t remember what your last question was.
[00:02:38] CK: No. Just saying, what was the experience at Bitcoin 2021, seeing that news, and how that shifted how you thought about El Salvador before?
[00:02:48] AVW: I’ll answer a different question. Because I don’t know how to answer that question. It was interesting. I mean, so for us at Bitcoin 2021, this announcement came in, and it was a huge surprise for everyone. You had a standing ovation in the crowd, and everyone was cheering, and everyone was happy.
Then you get to El Salvador, and you learn that it was equally a surprise here, but the reaction was a little bit different, I would say. A lot of people here had a feeling like, “What the fuck is going on? What is this Bitcoin thing? Why do we have to deal with this?” I did feel there was a conference. It was a surprise for everyone. Bitcoiners, of course, were very happy with this surprise. People here were mostly just a little bit confused about this surprise.
I had mixed reactions, I think. I mean, it’s definitely put Bitcoin on the map. A lot of people are thinking about it, talking about it. That’s a good thing. At the same time, a lot of people aren’t necessarily very happy with the way the law is being implemented, and the way it’s being rolled out without any public debate before the law was implemented.
[00:03:51] CK: Awesome. Thanks for that insight. Alex, welcome.
[00:03:55] AG: I’ll just give an overview first, and I really want to hear from Matt Odell as well. Then we can get Enzo and Gerson’s take. I wanted to do this article for two reasons. One was to show the mainstream media who have reached out to me about this article, people from the New York Times and elsewhere have been reading this article and interpreting it and digesting it. I wanted them to understand that yes, on its face, this seems quite contradictory to have a government that clearly is heading in an authoritarian direction.
What is the contradiction there between that and then the fact that they’re adopting a nation state currency that’s decentralized, and beyond their power to manipulate at a root level, this is a fascinating geopolitical contribution that’s going to have a lot of human impact, not just in El Salvador, but beyond?
I wanted to create something that showed some nuance with regard to the fact that yes, this is historic. Yeah, it’s incredible that this government chose Bitcoin and not some central bank, digital currency, or some Chinese surveillance coin, or they chose Bitcoin as the legal tender for the nation. It’s still stunning to think about. On the other hand, what are the goals of this government? How will this serve them? I think, at the end of the day, it comes down to the idea of self-custody, and the idea of like, is it going to be 2 million people using Chivo, which is really promises to pay Bitcoin that are confiscateable? Or is there really going to be an organic movement of Salvadorans who actually, like starting in El Zonte, who actually learn how to use Bitcoin the proper way, and then it grows organically from there.
These are two very contradictory and paradoxical themes. Matt Odell, obviously, talks a lot about privacy and surveillance, but also, about government adoption of Bitcoin and the game theory of that. I’d love to hear Matt and his take on this so far. Then we’ll get into Gerson and Enzo.
[00:05:50] MO: Hey, guys. it’s an honor to be here. First of all, Gladstein, really, really appreciate you going down there firsthand, and writing such a nuanced and comprehensive write-up on the current situation. It was really helpful from my point of view as someone who has not been able to get down there yet. One thing I mean, I would definitely highlight that you mentioned in the piece, I think a lot of Americans aren’t really aware of, is how much harm we’ve done in that country, intervening and forcing our will upon the Salvadoran people.
I want to be very conscious that I’m not being an American trope over here and giving my opinions on something that I have not been on the ground firsthand. In general, my concern stems mostly from a skepticism of government and the skepticism of large corporations who often neglect their user base’s privacy, and abuse the relationship that they have with those users and the control they have over those users.
There’s a lot of things that I’m very optimistic about with the new Salvadoran Bitcoin law. Specifically, when you mentioned the fact that they can use any wallet is massive. I think, something that I did not expect to happen in any country for maybe even a decade, way ahead of the curve on that.
One of the things you really highlighted in the piece that I think is key here is there’s a huge education element. I think, Bitcoiners from around the world, as a community, that’s something that’s really actionable that we can get around, just in educating people in the best practices when using Bitcoin, because there is so many nuances when you’re trying to use it privately, and when you’re trying to use it as an individual, that is not necessarily as simple as just installing the government wallet.
There’s a bit of a concern here that you could have a lot of users flock to the government wallet, because it gives you free money, and it’s easiest to use. As a result, they end up having no financial privacy, and their funds can get seized at will, which is the current situation if users are using the Chivo wallet, the government wallet.
[00:08:07] AG: Yeah. Something you brought up, which I think is very important to point out is that currently, in many countries, including El Salvador, the cash economy is very important for a lot of people. This is the same case in Palestine and many other places around the world, obviously. It provides a level of not just privacy, but actually, disconnection from the regime and the government. It provides a place that the government doesn’t have a lot of control or oversight over in a good way. It allows people to actually conduct business in a peer-to-peer way that’s much more within their control.
Now, if this is part of a government strategy to basically get people to move from the cash economy to the Chivo economy, then we’re concerned. Because then, all these little transactions that are done using cash, which is of course, it can be debased. With the dollar, the Salvadorans are less worried about that. The problem is with cash, you have privacy, and you have a bearer asset that can’t be confiscated remotely.
Now, we’re shifting potentially, to people using a government digital dollarized wallet, that can be remotely confiscated and frozen, and has a lot more surveillance restrictions. One of the concerns is that this is part of a general global movement of moving from a cash economy to maybe a Chivo economy. Now, obviously, using things like, self-custodial Bitcoin wallets, and developing a peer-to-peer economy, that’s how we’re going to fight that trend. It just seems unclear across the country of El Salvador, like how that’s going to play out. Matt, do you want to weigh in on that?
[00:09:37] MO: Yeah. I mean, I just wanted to agree that I mean, that’s absolutely a trend we’re seeing globally. We’re seeing cash get phased out, not only by governments intentionally trying to phase out its usage and discourage its usage, but also, by individuals who are choosing more convenient digital options. I think, personally, President Bukele is a very savvy politician. He’s a populist. He’s very good at using Twitter. He probably has, like most people, many motives for implementing this. I think, it would be pretty naive to assume that one of the motives isn’t discouragement of the cash economy, which he has no insight into. The government has pretty much no insight into this cash economy that is supposedly a pretty major aspect of Salvadoran economy.
I would be very surprised that that isn’t one of his incentives, and one of his goals is to try and people – move people over to this more digital surveilled economy. At the same time, if you are going to do that, obviously, it’s strictly better that it’s being done on an open monetary network, like Bitcoin, where you can use other applications that are not run by the government, as opposed to a lot of these so-called central bank digital currency plans we see coming out of China and even the United States.
[00:10:49] AG: Right. Obviously, as long as the Chivo app still connects to the Bitcoin network, meaning that you can still withdraw funds into Bitcoin, and receive Bitcoin and Lightning payments from abroad, it’s a powerful tool, and it’s one that obviously, no other government has dared to implement. I don’t want to underestimate the power, the humanitarian upgrade that Bitcoin presents. This is what the mainstream totally misses. They might be accurate in their criticisms of Bukele from a political point of view.
You have to really understand what a massive upgrade this does present for people, when they can receive a payment, perhaps a remittance $50, a $100, $500 from anyone to their phone instantly. Then they can keep that in dollars without a bank account, or withdraw it into cash, or withdraw it to their own Bitcoin wallet. I mean, that’s just such an incredible tool.
Again, I have two guest speakers here. One was initially at least more positive about the law, and one was more negative about the law. We’ll hear from Gerson first, because he was more positive. Then we’ll hear from Enzo and then we can go back and forth. Gerson, go ahead. Tell us about your perspective on this as it’s unfolded over the last three months.
[00:12:01] GM: Sure. Yeah. First of all, thanks, Alex. First of all, for writing that article, and getting the story of El Salvador a pretty dense analysis of El Salvador’s history in front of so many eyeballs. I think, that’s really, really important. I want to agree with a lot of what you and Matt just said, with respect to the importance of this law, from the perspective of the human rights aspect, of giving people access to the Bitcoin network, and particular, in a country where 70% of the country is unbanked and doesn’t have the resources, or documentation necessary to open up a traditional financial instruments.
As you said, I’ve been very, very optimistic about this whole endeavor. Look, I don’t discount the possibility that a president with a supermajority in the legislative body who’s wildly popular, almost like, cultishly popular in some pockets of the country, I don’t discount the possibility that this man could also become corrupt, or have absolute power corrupts absolutely. I don’t discount that possibility. However, I think we’re all highlighting here that the monetary network that he’s opting the country into is one that he can’t control.
I cannot stress how, I think, meaningful that is to me as a Bitcoiner. Because at the end of the day, he’s not saying we’re going to go back on to the Colon standard, from pre-2001. I actually wanted to just, if you give me just a second, I wanted to touch on my own family’s history. My parents are both from El Salvador. They emigrated to the US about 40 years ago, in the middle of the Civil War, that was being fought by basically, a really bifurcated political system. A far, far right party against the guerrillas that turned out to be the far-left party in the country.
I would want to rewind the clock even further than that. About five or six generations ago in my family, on my dad’s side, they were coffee cultivators in a part of the country called [inaudible 00:13:55], where they owned the land that they cultivated, that they grew coffee on. Then somewhere in the early 1900s, a subsidiary of United Fruit Company comes by and effectively, doesn’t give anyone an option, and begins to buy up all the land. You can obviously, a lot of folks in this space can imagine, these are multinational interests, bedfellows with political leaders who give them the right of way in their country, start buying up all this land and then telling all the farmers, “You’re still going to work here, but now we’re going to pay you. Now, we’re going to pay you whatever wage we deem is profitable for us.”
That happened to my dad’s grandparents. Fast forward to 1957 when my dad is born in El Salvador, into abject poverty. Because their ability to build wealth had been taken from them, and so he was born into abject poverty. Further down the line when he was 19-years-old, because of that civil unrest and poverty and corruption in the country, you get a civil war, where if you’re 19-years-old, you have no option but to walk out the door and pick a side. You have to pick a side. What does my dad do? He comes to America, because that’s a rational actor’s best choice is just to leave, because those were bad options down there.
I’m going through this here, because I think my experience here in America has been one that we and I come. I’m just as American as I am Salvadoran. We as Americans look at Salvadoran immigrants and just look at the, “Oh, my God. What are you doing here?” We are unable to peel back the layers of history and understand what propels people to come to this country. At least in my family’s history, these are the dynamics, the underlying dynamics that drove our family into poverty and thus, up toward the United States.
For me, this is coming full circle now. I went down to El Zonte in July, and I can’t – I know, Jim Beda’s on here. It gives me so much joy and pride in my heritage to know that there’s young people, in particular, young people, who are so hopeful about their country now, and that the first thought isn’t, “Let me get out of here. Let me figure out how and when I can get out of here to go look for a better life.” Rather, “I can build the life that I want here.” In my view, having adopted this monetary network is a gigantic step in that direction towards freedom and sovereignty. I’ll leave it at that.
[00:16:24] AG: Thanks. Could you also just briefly comment on the remittance structure? How you would normally send money and what new opportunities this presents here?
[00:16:33] GM: Absolutely. Yeah. I mean, it’s very simple. Folks like my mom who routinely send a couple $100 a month to different folks, they are 100% accustomed to paying 6% fees on a remittance payment of a $100, something like that. This is presuming that that is to a person who has a bank account in El Salvador. There’s just the 6% transactional costs. My mom and every other person who sends remittances, they’re just used to it. That’s the way of the world.
Well, Strike comes along, well, more specifically, the Lightning Network comes along, suddenly, all of us are able to send those payments, first of all, and have them settle instantly. Meaning, the person can receive and use that money instantly, and with 0.3% fees. It’s absolutely game-changing. Most specifically, of course, for the folks on the receiving end of the remittance, not only is there not a financial cost. More of the money is actually arriving.
Not only that, but to the folks who are unbanked and who have to go to their commercial center in their town to go collect the cash, there’s far less risk. I’m sure everybody on this call already understands that. You don’t have to take three hours of time off of work, to go to the place to collect your cash, to stick it in your pocket and then go back home. The ability to send remittances over the Lightning Network is game-changing, I think, for the country.
Now to something that Matt said earlier, there’s a huge learning curve for anyone. When any of us came into this space, there’s so much – the topic is so dense. There’s a huge learning curve necessary both in El Salvador and also, I would offer here in the US. Because there’s 2 million of us here in the US, who are the ones who send the remittances. We need the education here in the US as well, and for all those Salvadoran, the diaspora, who’s up here sending the remittances down.
[00:18:29] AG: Okay, great. Yeah. Look, and there’s obviously, look, there’s attention in the Bitcoin space, I felt, between really strict freedom maximalists, libertarians who say Strike is a betrayal, because it has KYC. Chivo wallet, we should – I agree, we should protest Chivo wallet. This idea of even something like Strike, which is a private company, that it’s somehow is this betrayal.
Then on the other hand, there are people who are like, “Okay, let’s be practical about this. From a humanitarian perspective, this is a really useful tool.” In the same way that a lot of Americans find cash up very useful to convert fiat, maybe their income into Bitcoin, even though they make the trade off to KYC. Salvadorans are making that same decision. I think that’s an interesting tension I’ve noticed here in the Bitcoin space.
All right, so now we’ll go to Enzo, who has a different perspective. Enzo, welcome.
[00:19:22] ER: Thank you very much for inviting me. My name is Enzo Rubio. I’m owner of Point Break Café in El Zonte. I’ve been taking Bitcoin since November 2020. I’m very happy about it. My kudos to Gerson. He has explained in five minutes perfectly what is going on and basically, our views. I have changed from the last time we talked, Alex, I think I’ve changed my mind. I’ve been doing more research and stuff. I think, it’s a very positive thing that can come out of Bitcoin. Obviously, it cannot be the silver bullet to get out of poverty and stuff, but it can help at the end of the day.
What I think we’re missing here, everybody is complaining about the Chivo wallet. I’ve been playing with it a little bit. Just today, only today, I was able to download it. I had my employees downloaded it. We have been testing it. Basically, we need two things from the government. The main thing is education. If we don’t have the right education to know what is going on, what an on-chain transaction is, what a Lightning transaction is, how the market moves and stuff, you’re going to have a lot of people really pissed off.
They see their balances going down and they feel that the money has been stolen. It’s difficult when you don’t have the right education. I think, education is one big part that the government is not doing right now. Possibly, because they are trying to fix the technical difficulties a bit more than the education part.
The other part that I think the government should improve is transparency. Beyond the use of everything, Chivo wallet, or any other wallet we want to use here in Salvador, I think the transparency of how the government is using Bitcoin is going to be key. As you know, the Chivo wallet has two balances on it. Has a US dollar balance and a Bitcoin balance. It’s not the same. It’s two wallets. It is different than a Strike. Strike, you have a USDT balance and that’s it. Bitcoin Beach, for example, has a Bitcoin balance that you can see in in a dollar value
Chivo wallet has a Bitcoin wallet, and you can see the dollar value of it. There’s another wallet, or another balance in the same app that is US dollars. It’s not USDTs. It’s not USDCs. We don’t know what it is. Possibly, it is US dollars. Chivo as we know it is not a bank. Transparency for me is important. If it is not the bank, where is the money? Who has it? That is not clear to me.
[00:22:19] AG: You also mentioned, Enzo, that it’s not still clear who owns the Chico company, and people have a lot of questions about that right?
[00:22:26] ER: Well, it’s actually very clear. We know that Chivo wallet is owned by [inaudible 00:22:31], which is basically an LLC, and is not the government. It is indirect run by the government. It’s a private company. That another private company created that is related to the government. It’s like a second layer, beyond the government. So far, it’s not declared as a bank. It is an enterprise, basically. It’s not the bank. It’s not even a financial corporation. It’s just a company, more like a regular business.
[00:23:06] AG: Some people are afraid of, Enzo, is if Chivo becomes popular among let’s say, several 100,000 people, they’re using it all the time, whether it be the Bitcoin, or the dollar balance as displayed in the app, really, these are just promises to pay, that at the end of the day, need to be liquidated into cash, or Bitcoin, if the user just tries to withdraw the cash at a ATM, if they try to make a bank wire to their bank, or if they try to withdraw the Bitcoin to their self-custody wallet.
The question is going to be, what happens if everybody tries to withdraw their money at the same time? Do they have the liquidity to settle that? That’s, I guess, another question people have, right?
[00:23:45] ER: Absolutely. That’s my main question. This is a private company, that is not a bank, is not a financial institution, is not under the vigilance of the institutions that also check all the banks and all the other financial institutions, then how do we know the money is there? I think, Bitcoin is a little more difficult to fake. Let’s say, that the balance, because we now know that we can transact Bitcoin from Chivo.
[00:24:14] AG: They could freeze it. I mean, it’s like your Bitcoin balance on your cash app in America. You don’t have the keys to it, so they could easily just freeze that. As I’m sure people will find out when they no longer can log into their account one day, maybe it’s down for maintenance or something.
I think, one thing Enzo is working on, just education to help people understand that, at best, the Chivo is like your checking account, and you really need to be withdrawing any Bitcoin that’s meaningful amounts onto your own wallet, whether it be the Bitcoin Beach wallet, or a Muun wallet, or a BlueWallet, or whatever. That’s quite clear. When I was a customer at your cafe, the barista was extremely adept at taking my Bitcoin payment. I mean, way more so than probably anybody in Silicon Valley.
The question is, how long does it take for staff to become comfortable taking Bitcoin payments? I mean, how many months did that take you guys? You said that when Jack Mallers visited, you got a lot of exercise, because he was coming three times a day, right? How long did that take you out to get familiar with this?
[00:25:17] ER: It was pretty quick. Kudos to the Bitcoin Beach guys, they did a pretty good job. I think, it is just excellent how things were working before the law. In El Zonte, it was just easy. I think, the Lightning Network makes it that possible. Without the Lightning Network, I’m pretty sure it wouldn’t work, because nobody’s going to wait 10 minutes, or even a day, and pay up to 24, 25. You never know how much fees to pay for a cafe.
With the Lightning Network, the thing is that you can see it instantly. It was pretty quick, actually. It took us maybe two days. I wouldn’t say, no more than 10 transactions to understand at least how to create the invoice.
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[00:29:26] GM: We have this phrase, Enzo, in America called ‘the bigotry of low expectations’. Basically, you have a lot of people in New York City working at the New York Times, or whatever and they say, “Bitcoin’s too complicated. No one will ever be able to figure it out.” Okay. This is basically, in a way, racist. It’s basically saying like, “Oh, people in emerging markets won’t be able to figure it out.” I would just urge people when they’re reading the media, and the newspapers to understand that that’s not the case and that in fact, forget the Bitcoin law in El Salvador. I mean, they’re probably close to 10 million, if not more, if you include India, probably close to 20 million people in emerging markets using Bitcoin right now, whether it be in Argentina, Turkey, Nigeria, I could go on and on, and they figured it out just fine, probably faster than the people in Silicon Valley, because they actually understand what it is. I just wanted to make that comment. I’m not sure if you have a reaction to that, Enzo.
[00:30:25] ER: Yeah, absolutely. I think, we have to make to separate what is for regular people, people working in industry, you see the Lightning Network, or Chivo wallet, whatever using Bitcoin, and what the government can do, by using Bitcoin. I think, on the day-to-day transactions, all the pedestrians, it’s going to be easy to understand at the end of the day, if they just use one wallet, and they do Lightning payments. I think, it’s going to be really easy to understand.
If you give the proper education and the proper education. I am not saying that you need to send these people back to college. Everybody gets a smile when its related to money. Once they understand and they feel safe having money in their phones, in these apps, it’s going to work. What they do in El Zonte, the Bitcoin Beach guy was the right way to do it. It was a circular economy. They were hiring people, paying in with SATs and then convincing other businesses to take those SATs. For me, that was a key. Everybody understood. As I said, as a pedestrian, like someone working on the street, it was really important to have instant payments, and it was all value in dollars. I don’t see any difficulty in that part.
[00:31:42] AG: Aaron, awesome that you’re here. A lot of us saw your video that you made of operating one of these ATM, Chivo ATM, and then having a friend abroad pay the invoice. Have you thought about that some more and zoomed out and thought about what that could mean moving forward? What are the possibilities here around the idea that anyone in the world could pay an invoice in El Salvador instantly, versus the legacy economy?
[00:32:09] AVW: First of all, it wasn’t even a friend. It was someone on Twitter that I have no idea who it was, or what his real name is, so that – Even cooler if you ask me. Yeah. Well, as you saw, that went smooth. That went even smoother than I expected. Because usually, well, this is maybe a tiny one, but usually, you get a printed out thing. Then you have to come back when there’s a confirmation. This time, it was instant. Yeah, that was super cool that someone was able to send me 20 bucks from I don’t know where in the world, almost instantly. I think, it cost 20 cents, just the transaction fee.
Now, of course, one of the reasons it is cheap, and that’s a more complex topic is because the government is subsidizing the conversion. There is some cost, there is some friction behind the screen, that the government is paying for that, it’s subsidizing, and getting back to, I think this was one of – was it Gerson who made this point, or maybe it was Enzo. Sorry, I don’t remember. There’s not a lot of transparency on anything from the government.
The fact that it’s working, it is obvious. What was even cooler, in my view, is that I went through the McDonald’s and took a photo of the QR codes on the payment terminal. Then someone paid for my Big Mac, instantly over Lightning for a fraction of a cent. The whole concept of remittances is like a [inaudible 00:33:33] concept at this point. It’s like, talking about long-distance goals. No one has long-distance calls anywhere. We just use Skype, and that space for payments. If you don’t recognize that, you’re not paying attention.
[00:33:47] AG: Aaron, what about the thought around people who believe that Twitter is about to add in the near future? I mean, we have confirmation from the product head. They’re going to add Lightning. It looks like, it’ll be through Strike. There’s some Bitcoiners that are like, “This is bad. This is a betrayal.” There’s others like me, who are like, “Oh, that’s a really useful functionality for people who already are KYC’d, or maybe are a non-profit, or a business, and they want to receive payments from anywhere in the world instantly.” What’s your take on this tension here?
[00:34:21] AVW: You’re basically asking if I see a problem with building closed systems on top of an open system.
[00:34:27] AG: Exactly. Is it –
[00:34:28] AVW: Like, it comes to demographics.
[00:34:31] AG: We’re going to be recreating a lot of traditional systems. They’re just going to be connected with Lightning instead of with Swift. I mean, I guess, I find it hard to see why that’s a downgrade, but I mean, Matt, I’m sure you have thoughts, too, Odell. I’d love to hear either of you on this.
[00:34:45] AVW: Yeah. I mean, it’s obviously not ideal, but it’s also better than nothing, so it’s hard to complain about it. I mean, as a European, I cannot use Strike, or at least not right now. For me, something like this wouldn’t be accessible. I guess, you’re seeing a similar problem with the Internet itself, where the internet itself is maybe at least has the potential to use it apparently anonymously. Then on top of the Internet, we – or take email for an example. You could run your own email server and be very anonymous, but in reality, everyone’s using Gmail, or Outlook, so everyone’s emails are being read.
Yeah, I can definitely see the arguments that it would be a problem if we’re moving in that direction with Bitcoin as a whole, and we have this flow services on top of Bitcoin that everyone’s just using, instead of running your own node and instead of having their own Lightning wallet on the phone that’s on it.
[00:35:38] AG: Matt, what’s your take on that?
[00:35:40] MO: Gerson, you want to jump in real quick before I go?
[00:35:42] AG: Go ahead.
[00:35:43] GM: Sorry. Thanks, man. Yeah. No, I was just going to offer that I think about it as a continuum. Many of us would never have known how to buy Bitcoin, if Coinbase didn’t exist. We all agree that there’s gigantic risks involved with holding any coin, or any exchange. It was the on-ramp for huge swaths of adoption. While we know there are these closed systems are problematic, I tend to think of them as part of the learning continuum for everyone that’s coming into the space.
I am not a technician. I’m not a person who could physically technically buy Bitcoin back in 2012. I just didn’t know how to do it, nor have the skills to. Similarly, I think of it as a continuum. I don’t know if that makes sense.
[00:36:29] MO: I mean, Gerson, I tend to agree with you. In general, I think that we really want as many options available to Bitcoiners as possible. Alex mentioned Twitter adding Strike functionality. I think, it’s important for people to realize. It’s a bit tangential, but it’s important for people to realize that it’s not really them adding Lightning. They’re adding Strike. They already support Cash App and Venmo, and I believe, PayPal, so they’re adding another payment processor there. Hopefully, they add more native Lightning support in the future.
In general, these ideas, Lightning is very new technology. Hopefully, we have easier self-sovereign tools that protect your privacy that are open source, that make it more convenient to use Bitcoin in a more sovereign way. Unfortunately, we’re not fully there yet. A lot of these band-aids are being put on in terms of custodial services. The biggest issue with custodial services is twofold.
One is custodial risk. They can steal your money, or they can lose your money, which is historically throughout Bitcoin, there’s been many cases of custodians losing your Bitcoin and people having less money because of it. Then the second reason, which I think is almost even a bigger reason today, in America, and in a lot of places in the Western world, these custodians because they’re trusted third parties, they’re forced to implement KYC and regulations on their products by the governments that hosts them. As a result, there’s little to no privacy. If anything, it’s the opposite of a private wallet. It’s a surveillance wallet as a result.
Because El Salvador is going full on into Bitcoin, it could end up in a situation where custodians are necessarily obligated to have these very inconvenient and poor privacy regulations attached to them, where they have to accept all this personal information. It’s a little bit early to know if that’s going to be the case. I mean, it seems with Chivo, it’s mostly a phone number is my understanding. Correct me if I’m wrong on that. One of my big concerns here is, in general with people, we live our lives choosing decisions based on convenience versus privacy, security tradeoff.
We oftentimes will choose something that’s more convenient, that is less private and less secure for us. If Chivo gets to play by different rules than other projects in the space in El Salvador, it is going to be the most convenient option, because it has the government’s blessing. As a result, more people will use it and its ability to abuse the privacy and the sovereignty of their users grows as they have market share dominance.
I mean, Enzo mentioned that Chivo LLC, that is the company behind the wallet. I’m pretty sure we don’t even know who the owners of that LLC are. Who is the controlling interest behind that LLC? Are they going to get favorable treatment over other projects? For me that’s a thing that we should all be watching to make sure there’s no abuse there.
[00:39:27] AVW: Just to be clear, the ATM is phone number only, but the actual application is just full name and everything.
[00:39:36] ER: I can give my opinion here. Yes, a Chivo wallet, you need your ID, so they take the pictures of your ID. I believe, the US dollars balance is related to your ID number. The Bitcoin is the Lightning address. That’s what I have to say.
[00:39:56] MO: Yeah, again. Just look, I was talking with Aaron a few days before the implementation. I think, a lot of us is we’re very skeptical that the wallet would even ship with Lightning. It is remarkable. Look, from a different perspective, there’s no way my government would ever roll out some social service for its people that had Lightning on it. That is not obviously not going to happen. Or in fact, our government is openly hostile to such an idea.
I think, we have to think a little bit here. One thing that I will point out and Enzo can help color this is that Bitcoin is not the silver bullet right now. There are two quite important functions that it does not fulfill natively in a self-custodial, non-KYC way. Now, it might fulfill these in the next few years. There’s things on the roadmap that might get us there, which would be amazing, which I’m paying attention to. The first one is that at the end of the day, people need dollarized balances for now. We’re not there to the point where Bitcoin is less risky than the dollar for most people. They need dollars.
Something like Strike, even though they make the trade-off to KYC, or something like the Chivo wallet, the fact that they can have the Bitcoin value pegged to the dollar is very, very important. Now, it’s possible that in the next few years, you’ll be able to have a non-KYC, non-custodial Bitcoin wallet that can actually peg natively to a dollar This is something that people are working on, but it’s not here yet. Until that is here, we need to be open-minded to the fact that people, especially in emerging markets, it’s very important for them to have dollars. This is demonstrated by the fact that many countries tethers very, very popular, like Lebanon, Palestine, etc.
The reason why tether is very popular, is because it’s a less regulated dollar that people can get their hands on without a US bank account. This is something we just need to pay attention to. The second feature is a tip page. Obviously, when Carla who works with Enzo was able to receive a lot of tips from the video I made, that was only because I was able to paste the tip page in my tweet. We’re not there yet, but with what are called offers, I guess, is what the industry is coalescing the jargon around.
Soon enough, you’ll be able to pin a QR to your Twitter profile and receive Lightning payments from anybody, without hurting your privacy, but we’re not there yet. I think, we’re actually fairly close. If Enzo, if you can think about it this way. Imagine if you can go into your Muun wallet, or Bitcoin Beach wallet or BlueWallet, forget something that’s even custodial, like Strike, and generate a QR from inside of it and then paste it onto your Twitter page, or put out in front of your store, you can just be receiving Lightning payments in a way that’s totally self-custodial and protects your privacy.
I think, offers are huge. They’re just not here yet, though. Until we have offers and until we have stabilized non-custodial lightning accounts that can be pegged to fiat, people need these partial solutions. I think, that it’s naive to – you live in a bubble if you don’t think that’s the case. That’s just something I feel quite strongly about after doing a lot of research in emerging markets. I don’t know, Enzo, what’s your reaction to that?
[00:43:02] ER: Well, I’ll tell you the story of Carla is great. It’s amazing to see her. You posted that video and then sent a link and then she received lots of money from different people. We even have visitors just wanted to meet her, to know who she was. They were so happy about the Bitcoin barista now. She is the Bitcoin barista. Now Point Break Café is not even Point Break Café. It’s Carla’s Café. It was great. It was fine.
I do agree. I don’t know how to stress this enough. Without Lightning, things wouldn’t work the way they are working right now. Day-to-day transactions. If you’re working on the street and you want to buy something, you need the Lightning Network. They need instant payments. Some people will say, we need another blockchain, or another cryptocurrency or whatever. I believe, what we have with Lightning right now works. I know, it has some deficiencies. It is better to focus on how to fix those deficiencies, than to think on a whole new solution afterwards.
[00:44:01] MO: Well, I guess, what I’m pointing at Enzo, is that there is a technology potentially on the horizon, where someone could go up on their phone, and they could type in the amount for their coffee and then just scan a static QR code that you guys would just have sitting on your counter. You wouldn’t have to even prepare an invoice. That’s coming, which would be very interesting, right?
[00:44:21] ER: No, it’s right here. It’s right here. Bitcoin Beach, they can generate a QR and I can post it on my Twitter account and people could actually send me some payment.
[00:44:29] MO: Right, but that’s on-chain.
[00:44:32] ER: No, no. It’s Lightning.
[00:44:34] AVW: URL that will take you to a website, and there Lightning invoices then already.
[00:44:39] MO: I’m saying in the future, we’re even going to be able to cut out all those other steps, but we’re not quite there yet, which is why the Strike tip page is helpful for now. The fact that Strike obviously keeps your balance in dollars, you were telling me that people prefer that for now. Maybe they want their tips in Bitcoin, but not everybody’s comfortable going all the way over to Bitcoin for now.
[00:45:01] ER: Yes. I can tell you my experience for this morning. I was working in Puerto La Libertad. It’s the biggest town near the beach. There’s a huge line of people on the Chivo ATM, cashing up. I think, it’s going to take a few months for people to get used to have money on their app, and not wanting to cash it out. Right now, there’s a lot of people in all the ATMs and the Chivo ATMs around, just trying to cash out the money.
[00:45:28] CK: Hey, we have our friends here from OpenNode. If he wants to weigh in, that’d be great.
[00:45:33] ER: I’m going to just add one thing. I’m going to try to pass my QR code. Because I’m pretty sure you can send some SATs there. I’m pretty sure. I’ll post you in that.
[00:45:45] CK: Sounds good.
[00:45:46] JA: Hey, I was just listening to you guys. I’m not sure if I listened correctly. Were you guys talking about the McDonald’s user experience, where you got redirected to the website?
[00:45:55] AVW: No, we were not. We were talking about the Lightning – the Strike tip page and the Bitcoin Beach wallet tip pages.
[00:46:02] JA: Oh, I see. Because on that, they’re testing right now to print actual, the Lightning invoice. Any wallet will just scan and be able to read. That’s pretty cool.
[00:46:13] CK: Awesome. What’s your take on this? You guys were involved in some of the integration with some of the merchants. What’s your take so far?
[00:46:21] JA: Honestly, this happened very fast, to be honest with you. We were not even pursuing the market. These big companies came naturally organically to us, because there was no other solution at this point with our track record. Then, we started investing more in the market. As you guys probably saw, we have pretty big corporations there using our products. There is a lot of stuff that we can’t talk about, because they don’t want to be tied to us. That’s the only issue here.
[00:46:59] AVW: Have you got any insight in how many people are paying with Bitcoin over here?
[00:47:03] JA: Yeah. I can say, our biggest client is definitely a telecom there. The biggest use case is remittances. What I can say, is that the number of payments in LN in general, real six times since we added them.
[00:47:20] AVW: Do you have any absolute numbers by any chance?
[00:47:23] JA: I have, but I can’t disclose.
[00:47:25] AVW: Too bad.
[00:47:29] AG: Your take is, if you had to say now, would you say that things are moving more smoothly than you thought? Or what’s your take in general on how things have been going?
[00:47:38] JA: I think, the initially when we started talking with these big companies, they had no idea what Bitcoin was. There was definitely some education part there, understanding how the system works, especially on the fraud part. They don’t understand this is not like a bank account, where you can tie your identity, etc. It was hard in the beginning to make sure that everything was according to their procedures.
It was forced. We all know that. Eventually, they had to comply, and especially the big companies had to have Bitcoin, since day one, which most of them did, but they just didn’t announce.
[00:48:14] MO: Cool. Thank you.
[00:48:16] JA: Regarding the wallet, honestly, the most problems appeared when based on Chivo wallets, right? Things were not working in the beginning. These big companies were pissed off, because Chivo wallet couldn’t pay our invoice. That’s when things starting to escalate a little bit. Because they wanted in their mind, they want to get the biggest pie possible from the 180 million. As a company, you’re trying to get down money. That was definitely an issue in the beginning. Eventually, we understood that Chivo wallet was not reading the codes correctly, so we adopted on our side and so did other companies. There are is still problems with Chivo wallet.
[00:48:56] AVW: There was also the issue that the third $30 in the Chivo wallet could only be spend to out a Chivo wallet, right?
[00:49:02] JA: Correct. Yes. We even had a couple of the companies saying we are integrating now with the Chivo immersion thing. Because we want those $30. That’s your goal.
[00:49:12] AVW: For context, just to make this clear for people that don’t know this, so everyone got $30. Every Salvadoran got $30 in their Chivo wallet if they downloaded the Chivo wallets. Then, the restriction was and this was the goal was to incentivize people to actually use the Chivo wallet for payments, rather than just walking through an ATM and cashing it out, or whatever. The restriction that the first payments could only go to other Chivo wallets, the first $30 could only be spent to other Chivo wallets.
Once it was spent one time, so after one hop, then it was free to be spent to other Bitcoin wallets, or to cash out, or whatever, but the first hop could only happen between Chivo. This caused a huge mess, because a lot of people, like that walked over to McDonald’s to buy a burger and then they found out that they couldn’t. Meanwhile, McDonald’s put in all of this effort to get these $30 from people. They knew everyone’s getting $30 to spend. Let’s make sure we’re ready on day one, so everyone’s going to come to us to spend these $30.
Then because of this restriction, which was not announced ahead of time, as far as I know, the McDonald’s was pissed off, apparently, and rightfully so, because people couldn’t spend their $30 there. People were confused, because they thought they were going to be able to spend the $30, but they couldn’t. They had a bad first experience with Bitcoin. It was just a complete mess that they put this restriction on. In my opinion, it did more harm than good.
[00:50:33] AG: I know that the government said the other day that you’d be able to start topping up your Chivo balance with a credit card. Is that possible now or not yet?
[00:50:42] AVW: What I can tell you, maybe someone else can answer that specific question. I’ve been playing around with the Chivo wallet quite a bit. It’s basically not working, I would say. Maybe Chivo to Chivo works. If you want to spend – I’ve been trying to make Lightning payments, or on-chain. Either the wallet is too buggy to do anything with it, or it won’t even start. If it does start, then the payment won’t work. I mean, they released unfinished software. I don’t know about topping up. I don’t know. Maybe someone else has a answer for that.
[00:51:15] MO: Yeah. I’m not sure about the topping up, regarding the reliability of the wallets. I mean, our payment volume is definitely increasing day by day. I think, that’s because there is more people joining, or getting the $30. It’s definitely better than before, I can assure you that. There are still issues. The problem is, we don’t know who’s in charge. We can’t talk with anyone from their technical team. It’s like, everything is a secret, so that doesn’t really help.
[00:51:43] AVW: It’s not like I have a GitHub page, or anything like that. It’s very contradictory to the open source spirit of Bitcoin.
[00:51:50] GM: For what it’s worth, I know if you go to chivowallet.com, there is a page dedicated to basically, it seems like a remittance flow, where you can pay with credit card to any Chivo user. I haven’t tested it myself.
[00:52:05] AG: Yeah. Again, I think you have the traditional modernization remittance alongside open Bitcoin experimentation. This is a good moment to just reflect also on the fact of the lack of transparency, and the fact that the government is doing this very secretly. I brought Simon up here, because I wanted to hear from him. He’s been as well. Obviously, he saw his government go through a very sad erosion of democracy. I was actually down in El Salvador with him, and he saw some of the things, same things that I saw. It was just interesting to hear him from a Venezuelan perspective comment on what’s happening. We’ve talked a lot about the village, but let’s talk about the strong man for a second. What’s your perspective from a regional perspective of what’s going on with Bukele and his political opponents and things like that?
[00:52:53] SL: Yeah. Thanks, Alex. Hey, everyone. It’s interesting, right? His party’s name is Nuevas Ideas, which means new ideas. He’s following the exact same playbook that your typical, what ends up in a right-wing dictatorship looking like. I think, you posted a thread, or you shared a thread in the previous days, but it took Bukele two years to dismantle most of the country’s institutions. That Chavez in Venezuela, I think, six to eight years.
When we were there, you and I were together in El Salvador, we were seeing the erosion of these institutions in a place that I’ve never seen, or experienced before, in the sense that, from one day, he published a lot, basically saying that any judge above 60 should be removed, which was one-third of the country’s judges. Then, two days before the Bitcoin law, and the government combined with the Supreme Court, which he had taken control of a few months prior, basically posted a position that said that Bukele could get reelected.
Not only is he going through the same erosion of institutions, but now, he’s already able to be reelected. This is changing from the single-term to two terms. We know where this is going. Every change is a minor change, little by little. When you look at it in the addition, it’s very clear that there’s an authoritarian government that is –
[00:54:16] AG: Yeah. It’s worth pointing out, Simon, that it’s not – he’s not going to be nationalized and stuff as much, it seems. It’s not really a [inaudible 00:54:23] nationalizer.
[00:54:27] SL: It doesn’t seem like he is, but he’s also been in different parties on his life. Yes, he’s acting right now, like what you would call right-wing authoritarian, which eventually ends up, usually ends up in a militarized economy with significant reduction in freedom of speech and freedom of expression. What ends up happening, and I think we were discussing this, which is an interesting clash of when that ends up happening, and he is, let’s say, freezing his opposition’s bank accounts and trying to jail everyone that is in opposition of him. What happens then when the opposition has access to Bitcoin?
Because now, you can control them through the Chivo wallet, which is I think, part of the government’s plan is controlling the financial movements of the people through the Chivo wallet. You actually instantiated legal tender of a free and open source money. Now, the opposition can get donations, and they can pay the merchants as of right now, and pay people in the country with open source wallets. It’ll be interesting to see if and when that happens, whether the government closes in on only the use of the Chivo wallet as official.
[00:55:36] AG: Right. This is why it’s so important to spread knowledge about Bitcoin self-custody. I spoke on the phone with the editor of El Faro, which is one of the fierce independent newspapers exposing government corruption in El Salvador. Not just Bukele, but his two predecessors were helped. El Faro was helpful in getting rid of two previous presidents who are very corrupt. They’re always just trying to figure out what the government is doing. I think, they share a similar stance in some ways as what Matt Odell said earlier, just general skepticism of government.
Here, you have a situation where they don’t have any good knowledge about Bitcoin itself. I’m sure, Enzo has seen this in the local media, but what’s sad is that the opposition doesn’t have a lot of resources and doesn’t really understand what Bitcoin is. One of my goals is to try and make myself available to help run workshops, or seminars, or do things for civil society groups, or the local independent newspapers. I’d like for them to actually understand how to use this tool, just in case they need it. I mean, look, the writing’s on the wall. This government has expelled journalists, and it is not out of the question that they start going after the media in a more aggressive way. We’ll see.
[00:56:54] CK: Bitcoiners, I am so excited to tell you about the Bitcoin 2022 Conference. You guys, Bitcoin 2021 was absolutely a smash hit success. It was over 13,000 Bitcoiners coming together, breaking the barriers on who can come together and celebrate freedom, celebrate Bitcoin. The energy was absolutely electric.
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[01:00:50] CK: One of the most interesting things here is that what the freedom opposition, what they need to do is actually lean into Bitcoin, rather than stand-off it, or oppose it, which is what they’re doing. That’s really counter-intuitive. To add to that, I want to give a shout out to you, because before this even happened, you wrote Bitcoin as a Trojan Horse for freedom. That seems very prophetic now that we are six months after that, the actual article.
[01:01:19] GM: Yeah, well, I mean, the meme has always been that some dictator is going to adopt Bitcoin for selfish reasons. Then as it turns out over the years, it backfires, because it gives more power to the people. That’s what I thought. Honestly, I thought the first government to adopt Bitcoin was going to be a rogue regime or something. A US ally that was a partial democracy and a dollarized nation was not on my shortlist, but it is what it is. Matt, do you have something to say?
[01:01:44] MO: I mean, we might have had one of them start using Bitcoin already. They just don’t talk about it. One of the things I wanted to talk about, and I don’t know if this is too tangential, because we haven’t discussed it yet. One of the controversial things here is this Bitcoin wallet was is forced legal tender, where everyone needs to accept Bitcoin. I think, you and Simon made an interesting point, that a lot of our work that, at least a lot of the work that I’ve been doing, helping activists in different parts of the world, one of the major issues with them harnessing the power of Bitcoin and accepting Bitcoin donations globally, is what do they do with the Bitcoin once they get it?
Whether or not it was Bukele’s intention, the fact of the matter is his opposition in El Salvador now can easily spend that Bitcoin on goods and services at any merchant throughout the country. They can use those ATMs to get dollars out with only a phone number, which can be a burner that they paid for with cash. That is a massive improvement for opposition, that is the single biggest pain point when we see other opposition groups around the world trying to use Bitcoin.
[01:02:58] SL: Similarly, with remittances too. It’s exciting what you’re saying, and Alex has been harping on this point. Now, because as far as in the sense of the law, the law gives a work around whether you’re not technology ready to accept it. That’s been happening. From the remittances and from the spending, this is actually solving the last mile problem, which is usually, like you’re saying, Matt, it’s the biggest problem with Bitcoin so far. Whether or not the ATMs are working fully or not, just the fact that they exist, and they’re going to get better and better, yes, I don’t particularly that they’re government provided.
Of course, they should work and they do with more than just a Chivo wallet, but it’s a huge improvement for the citizens and eventually, for the opposition, as the government starts cracking down, which for me, it’s a when, not an if.
[01:03:47] CK: Gerson, do you want to – Go ahead.
[01:03:49] GM: Yeah. Just a quick comment, and I think Enzo would probably have even better perspective on this. I think, we’re seeing a lot and just in my own family and friend group in El Salvador. A lot of the opposition, you see the no out of Bitcoin symbol everywhere, and the notion of protests against Bitcoin itself, I think is misdirected anger and frustration at the strong armedness of the government, then being turned around and directed at Bitcoin itself out of a lack of education.
Going back to the point about awareness and education in El Salvador, about this freedom money, about the ability that you now have to custody your property, I think, boils down to a lack of education. Of course, I understand, there’s so much opposition to Bukele’s administration and his tactics and the direction that he seems to be going in. I just think that then gets redirected, or gets branded as anti-Bitcoin.
[01:04:45] AG: Just real quick. I think that to be clear, whenever you talk to informed opposition, they will say, “Well, look. We’re not against the software. We’re against the way it’s being rolled out and the government.” I think that they’re going to learn about it. I mean, I was talking to a journalist who’s in El Salvador, who reports against the government, as any good journalist should do. He was like, “Yeah. I mean, look, we are realizing that this is not going to go away anytime soon, and we need to learn more about it.” Hopefully, the Bitcoin community is willing to reach out and be a resource for people that may need to learn about how to use Bitcoin to achieve financial freedom in a difficult environment.
[01:05:23] GM: Right, right. Agreed, agreed. No. Yeah. I think, I was just speaking more to the regular person on the street, who isn’t, as you put it, a super informed person about the technology. They just tend to tether to their traditional, if they’re [inaudible 01:05:39], they’ll go with the party line there, with respect to being anti-Bitcoin.
[01:05:44] AG: I was also talking with a friend of mine who was in one of the chats. There’s spaces every day almost with some of the opposite – let’s say, informed opposition in El Salvador, like educated technical people. It seems like, there’s a little bit of a shift from very intensely negative everything about Bitcoin, to more acknowledgment that, “Oh, my God. It’s going to be around. Maybe we should learn how to use it properly.” I think, that’s a really good opportunity for those of us who can to get in and help where we can.
One other just take I had that I’d love to get this panel’s input on was, maybe it’s a galaxy take. When I was down there looking at the Chivo ATMs in the airport, and thinking about, well, who is actually going to be buying Bitcoin, right? I’m thinking about, “Okay, there might be remittances coming in and Bitcoin, and tourists might be coming in with Bitcoin. Is there going to be a demand for Bitcoin, from inside the country?” For now, it takes months or years probably for people to get comfortable converting their fiat and large amounts to Bitcoin.
One of my concerns in a way is that essentially, what you’re going to have is the government is going to be taking the Bitcoin, whether it be from remittances to Chivo, or through spending from people like us when we go visit, or whatever. Some people like the convenience of being able to withdraw cash without having a bank account, etc., etc. They’re going to be stacking SATs, basically.
Meanwhile, they have the people using this app, which is a promise to pay Bitcoin or dollars. I don’t know. There’s something interesting in that. I’m not sure if someone has a take on that. It’s like what the Cuban government does. The Cuban government prints this peso, which is a worthless, depreciating currency. They pay all their public sector workers and their pensioners with it. Then, they force people to buy things in stores with hard currency from abroad. My suspicion is that in the next few years, they’ll actually allow you to buy with Bitcoin as well, because they’re going to want to stack that too. I’m just curious what people have thoughts around this idea.
[01:07:41] GM: I’ve noticed that governments tend to like to scam, and it’s a very convenient scam you can do on the Internet.
[01:07:48] MO: It’s definitely an interesting dynamic that you mentioned this last thing, because if you look at worldwide Bitcoin ATM usage, usually governments make it extremely hard for you to sell Bitcoin at an ATM. Athena, Athena Bitcoin, who’s running the Chivo ATMs is my understanding. The majority of their business is buy Bitcoin only. I tend to agree with you that in El Salvador, it will be the opposite.
[01:08:14] AG: Yeah. I mean to Gerson or Enzo, I mean, do you have thoughts on – I mean, don’t you think that most of the usage at first is going to be people probably selling some of the Bitcoin that they get?
[01:08:23] ER: Yeah. As I said, people are making huge lines in front of the ATM just to cash it out. I think it’s, as you say, like Gerson say, the key word is my direct anger against Bitcoin? I think, the more people will search for what Bitcoin is and how to use it, the less barriers you will have. I think, it’s restricted, guys. It means, direct anger and poor education so far. The fact that it has been imposed, and has been adopted is a different, different situation.
[01:08:56] AG: Right. Gerson, before you go, I guess let me just boil this down. What I’m describing is a new state attack that I think we’ll see in the future, which is government’s printing fiat as salaries, or some credits for the population in exchange, that they’re stockpiling Bitcoin, but we’ll see. We’ll see. That’s maybe down the road.
[01:09:14] AVW: They can print dollar. They can print dollars, right?
[01:09:18] AG: They can print Chivo balance. A 100%. What if Chivo balances become the way they do fractional reserve?
[01:09:26] AVW: They can if people hold their balances in Chivo balances and trusted equally to the dollar, which I think are two ifs.
[01:09:35] AG: I mean, yes. I mean, if the governments do it, I mean, that gives them a way to print dollars.
[01:09:39] ER: Yes. That’s why I was telling you about the two balances that Chivo wallet has, that one balance is Bitcoin and the other balance is in USD. Not meant that the Bitcoin balance is expressed in dollars. It’s just a different wallet. It’s like having two pockets in the same wallet. Yes, it could happen that maybe tomorrow, and Bukele can say that he’s paying all the teachers on their Chivo wallet on US dollars.
[01:10:08] AG: Exactly. Instead of via [inaudible 01:10:09] or in cash. Exactly.
[01:10:11] ER: Exactly. People would say, “Well, at least it’s dollars.” Because we don’t have the transparency, we wouldn’t know where those dollars are, if they back it up with real dollars. We wouldn’t know.
[01:10:23] AG: Meanwhile, just to complete the thought. He’s taking the money that you normally would pay them, or the state would take the money it’s normally paying workers and is buying Bitcoin with it. I mean, he just bought the dip today. Does anyone know where that money comes from? I mean, it’s not even clear whether it came from the initial loan that they got earlier. I don’t know. Go ahead. Sorry.
[01:10:42] JA: Which by the way, this is exactly what the Venezuelan government is doing with the Petro, in a much sketchier way, but still doing that. The way Venezuelan government’s paying engineers, and other government workers in Petro, which is not even a cryptocurrency. It’s just a way for them to print any form of money that is in –
[01:11:02] AG: That’s what the Chivo dollar balance is. It’s not a cryptocurrency. It’s just a promise to pay dollars.
[01:11:07] AVW: Alex, you’re essentially tapping into one of the – maybe you don’t realize that, or maybe you do, but you’re tapping into one of the big debates within the Austrian School of Economics, which is, is fractional reserve banking even possible? Because one side of that school will say, it’s not possible, because once something like that would happen, and people learn that it’s happening, or suspect that it’s happening, then the digital currency will start to trade at a discount, versus the actual dollar. Then the other side says, “No, it’s actually possible.” That’s beside your supporting here, it sounds like.
[01:11:45] AG: I’d like to hear, Joao, from you as well. I mean, look, the fact is a lot of money gets created by private corporations. That’s how banking works today, in many ways. That’s what you’ll be seeing here. The idea that the government could essentially – the real difference from before, though, Aaron, would be that the government could say, “Now, if you are a public sector worker, we’re going to be paying you in Chivo.”
As opposed to the banking system, which is more regulated, and more tied in to the Fed, and to this life flow of dollars from the US. This would be a parallel system that they’ve created, that they could pay people into, that isn’t necessarily backed by anything.
[01:12:23] AVW: Right. The point is, that would only work if people actually trust –
[01:12:27] AG: A 100%. A 100%. I agree.
[01:12:28] AVW: – residual dollar equally. They would have to value with equally to the regular dollar, which I suspect they won’t, if this will actually happen. Like I said, this is one of the open debates –
[01:12:38] AG: Well, what’s happened in [inaudible 01:12:39]. What’s happening with one of these pensioners in Venezuela were being paid in Petro. What’s the black market rate for the Petro, versus what they’re supposed to be being paid?
[01:12:47] SL: That’s an interesting question. I need to know more about it. I don’t know. Yeah.
[01:12:53] GM: I’ll tell you, Aaron, to your point. You’re right. In Cuba, the government is still paying people in pesos, and they’re claiming that the value of the peso is 24 to the dollar. You go out to the street, and it’s 70 to 75 per dollar.
[01:13:06] AVW: Right. Exactly.
[01:13:07] AG: We will see. Anyway, go ahead.
[01:13:10] ER: I have two comments here. One is that people is suffering. On the street, you can sell your $30 in Chivo for $25 in cash on the street. You don’t need to go to the ATM. There’s already people around the city centers and doing that.
[01:13:26] AVW: Right. I think, the reason for that is mostly that it’s just –
[01:13:31] AG: That’s also, partly an educational, I think, arbitration, which will disappear. As soon as people realize they can withdraw that into Bitcoin, it gives it more power than – or into cash at a Chivo ATM. I think once those things start looking. Maybe they don’t work right now, but it’s an educational [inaudible 01:13:48].
[01:13:50] AVW: Yeah, it has a lot to do also with that first hop you need to make, which I mentioned earlier. This is a way for people to not have to bother with that and just get cash in their hands. For the convenience, they’re basically paying five bucks. That’s why we –
[01:14:04] AG: For sure, but it’s creating a behavior, I think, is what where Enzo is going for, which is – Joao, did you have something to say as well?
[01:14:15] JA: I was just saying regarding the fractional reserve, I feel they’re already doing it right now. They’re giving the $30 worth of Bitcoin, but they don’t own all the Bitcoin for that.
[01:14:25] AG: Right. I think, they’re assuming that, again, this seems like this could be a scheme. Look, this is why we’re here to be critical. Again, I think we’re going to wrap soon and we want to get some final reflections from everybody. I want to be clear that from my perspective, this is a historic thing. It is the march of open source software. It is remarkable that this government chose Bitcoin and not Bitcoin. They could have banned Bitcoin. It really puts the pressure on a lot of institutions internationally and corporations to get with the program. Now that Starbucks in San Salvador can accept Lightning, why can’t one on Dallas?
I mean, there are network effects here that we can’t fathom, that are going to change the world. The fact that it all came from a small village in El Salvador, that doesn’t even have paved roads, or bank accounts is really just extraordinary. I don’t want to distract too much from that. It’s really just such a powerful thing. Really an inspiring, unlikely story. That’s what I tried to capture in my piece.
At the same time, we have a government trying to take advantage of it in different ways. I’m glad you all joined for this conversation. I think we should just keep having it. Hopefully, we can help Salvadorans understand that if it’s not your keys, it’s not your coins. Maybe we’ll start with Matt, then we’ll go around and each share some concluding thoughts here.
[01:15:43] MO: I just wanted to thank Alex, and the rest of the panelists for joining for this conversation. I truly enjoyed it. It’s a very important topic. I want to thank the audience for also joining and listening. This is a very important moment for El Salvador. It’s a very important moment for Bitcoin. It’s a very important moment for the world. I think, we should all step up and try and do our part to help make this process as smooth as possible, as positive as possible.
To any Salvadorans listening to this right now, if I can do anything to help, don’t hesitate to reach out via Twitter DM, Telegram, Keybase. All my contact information is on my website, mattodell.com. Cheers. Thanks, Matt.
[01:16:27] AG: Aaron, do you want to go?
[01:16:29] AVW: Yeah. I mean, as far as final thoughts go, I would definitely encourage any Salvadorans to not use their Chivo wallets. Use it as the free 30 bucks app, if you can get it out and start using an actual Bitcoin wallet, both for ideological – well, it’s not even ideological. It’s the actual important reasons, like privacy and holding your keys. Also, because it actually works –
[01:16:51] GM: Uptime.
[01:16:51] AVW: Uptime. Yeah. Because it actually works, the regular Bitcoin wallets as opposed to the Chivo one. Yeah, in general, very interesting to see what will happen. The success of this story will at this point really depend on Salvadorans, actually using Bitcoin or not, or just getting the $30 out and never look back. That will be interesting to see. That’s something we’re going to see play out over the next couple of years.
[01:17:15] AG: Great. Joao, do you want to say a little something here as we conclude?
[01:17:19] JA: Yeah. Just keeping earns words try to move from Chivo. They’re getting better recently, but are your keys not your coins? What I can say from our side, from what we’re seeing, people are using Bitcoin, specifically for remittances. McDonald’s is cool. We’re seeing most of the traffic coming from remittances. We’re talking about values over a $100. We know they’re coming from Chivo or out, because when Chivo was down, base payments stopped mostly.
People are using Bitcoin, maybe not with the same value of the dollar, but they’re starting to learn about it. I think, it’s definitely keep growing. Hopefully, it’s a new inbound of money possibility for El Salvador people.
[01:18:02] AG: Thank you. Simon, maybe you want to say something?
[01:18:05] SL: Sure. Thank you for having me on. I think, it comes down to two things. It’s about education first with Bitcoin and education then of non-custodial. First if you can’t get to the non-custodial part of the of the explanation of what is Bitcoin, until you really understand Bitcoin first, I think. I see Roman here and Chimbera who was a Bitcoin Beach community organizer, and leader, and the work that he’s been doing for the past four years, educating people. You can clearly see that people at Bitcoin Beach now get it, and they’re empowered to now spread that knowledge.
This is a marathon, not a sprint. We can expect that things will work out as we want them to on day one. Yes, this is an authoritarian government forcing it down to people. In my mind, this is already a success in the Bitcoin story, in that they just helped spread the Bitcoin virus in a way, and it’s working on its own. It doesn’t follow anyone’s control, and will continue to see its growth as we educate more and educate more on the non-custodial aspect of it.
If you can, support what Roman and Bitcoin Beach and other types of educational activities are doing. Let’s scale those initiatives. Then, let’s spread awareness on non-custodial once that initial work has been done.
[01:19:23] AG: Gerson?
[01:19:24] GM: Yeah. Thanks, Alex, again, for hosting this space and for giving me the opportunity to come in and share some thoughts. I would just say that, just from my perspective, this is a country that has been ravaged for 250 years, first by an empire north of it and then next by a bifurcated political system. I know that this new administration is not optimal. It’s not perfect. Nobody is. I know that everyone on this call can fully appreciate how important this step is. Not only for people who have been stolen from and had their resources siphoned out of the country, but for the rest of the world.
In particular for those folks who have been subject to that financial impression. Again, thanks so much for this space. Let’s keep a close eye on the administration. Let’s continue to educate folks on non-custodial ways to hold your coins. Myself also, if I can be of any help to anyone in any way, both here in America or in El Salvador, please shoot me a DM.
[01:20:23] AG: Great. Enzo, you get the last word.
[01:20:26] ER: Oh, thank you all. Thank you for having me here. I think it’s very important that we spread the word. Definitely, I agree with everybody. Education is key. I think education at the end of the day is going to be peer-to-peer. The more we use it, the more people will learn and be confident about it. Then Salvadorians, we need to ask for more transparency, what’s going on behind Chivo? Where’s the money? As you say, not your keys, not your coins, I wonder where are those 700 coins. Who has those keys? How do they decide where to where to tip it, how to move it?
[01:21:02] AG: They could make it public, and they could actually have a proof of reserve thing, which would be even more transparent than any other government in the world. They could do that, and you should press them to do so. That would be interesting.
[01:21:13] ER: I think, that’s for Salvadorians to push, to have more transparency. I think, it’s really interesting. Then any of that future, we can see, or we can predict can be avoided by Bitcoin. Us at this point, we if we have enough education on how to use it, any outcome that will be happening in the future can be avoided. If we all use open technology. We don’t need to stay with Chivo. The law have some advantage over Chivo. Chivo have some advantages on law. I think, the more we know about it, the more we can avoid it.
[01:21:47] AG: Excellent. Thank you all for coming. My last word would just be that you should check out the incredible work that Jorge and Chimbera and Mike Peterson have done in El Zonte. It’s extraordinary. You should definitely go visit and see how you can contribute. It’s an incredible community that existed long before Satoshi Nakamoto came onto the scene and built exist actor, if anything bad happens to Bitcoin. They’ll continue to keep building what they’re building.
As a last thought, I just thought it was so interesting as someone who doesn’t speak Spanish natively, that we’re all talking about this country, that’s the first country to adopt Bitcoin and it literally means The Savior. It’s just something that I’ll leave for your food of thought as we continue on our Monday and thanks to Bitcoin Magazine for hosting us. Take care, everybody.
[01:22:34] CK: Yeah. No, absolutely. Thank you, Alex, for writing. Everyone who has not read Alex’s amazing article, just going over all this in detail and chronicling, I highly recommend you check out the pinned tweet at the top. Go check it out. Read the full article on bitcoinmagazine.com. Go and look up Bitcoin Beach and Bitcoin Magazine. We’ve been chronicling it for several years now as well. It’s been an absolute amazing story.
Then finally, I encourage everyone to go check out Bitcoin 2022, b.tc/conference. We have four different tickets. We have a lot of announcements come in. It’s happening in Miami. Alex will be there. Odell will be there. All the OpenNode guys will be there. Several people who are huge in implementing Bitcoin in El Salvador will be there. I encourage you check that out. Get your tickets while they’re still cheap. Be a part of Bitcoin history. That’s where obviously, the announcement from Jack Maller has happened as part of El Salvador’s history. That was amazing to be part of.
Everyone, check it out. Again, thank you so much to everyone listening and who joined. Follow everyone on stage. Read Alex’s article. Peace.
[01:23:42] AG: Thanks, everybody.
[01:23:44] AVW: Cheers. Thanks, guys.
Today, the Human Rights Foundation announced its most recent round of Bitcoin Development Fund grants, per a press release sent to Bitcoin Magazine. The money is being gifted to 10 developers who will work on improving privacy tools, strengthening developer education in emerging markets, making bitcoin onboarding a better experience for new users, and continued Bitcoin Core development.
This round of developer funds totals 3.75 BTC (375 million sats) which at the time of writing is worth $167,540.62. The funds will be distributed to the recipients with half of them receiving 0.25 BTC (25 million sats) and the other half getting 0.50 BTC (50 million sats) each. Below are the talented developers who will be receiving the funds, with some backstory on each of them.
Starting off the 0.25 BTC recipients is Lili and Richard Myers, who will initiate an open-source research project focusing on bitcoin in low-bandwidth environments. The research report the couple will be creating will be centered around technologies that facilitate the use of bitcoin in hostile environments. The aim of this project is to identify any pain points and improve user experience for individuals in developing countries and emerging markets. Kraken’s Dan Held was instrumental in making this grant happen.
The second round of 0.25 BTC is being gifted to Chaincase, a mobile and open-source iOS bitcoin wallet that allows users to use features such as CoinJoin, coin control, and Tor. The money received will be spent on supporting the addition of PayJoin, which is a peer-to-peer (P2P) CoinJoin transaction that helps restrain Bitcoin surveillance even for users who do not use PayJoin.
The third round of 0.25 BTC is awarded to SeedSigner who will use the money to upgrade their user interface, as well as add support for other languages and add new user optimizations. SeedSigner was gifted this grant for their great work taking advantage of Raspberry Pi Zeroes to create inexpensive open-source hardware wallets.
The fourth round of 0.25 BTC is given to LNBits for their user-friendly, lightweight, open-source Lightning wallet. LNBits currently supports LND, c-lightning, OpenNode, lntxbot, LNPay, and itself, LNBits. The HRF has stated that they will support the integration of LNURL.
The fifth and final recipient of the 0.25 BTC grant will go towards a bounty for developers to add a JoinMarket app to the Umbrel full-node platform. The reasoning for this will be to increase the privacy and fungibility of their bitcoin transactions for Umbrel users. This is estimated to increase JoinMarket usage which will result in bitcoin privacy being much more accessible.
BTCPay is receiving 0.50 BTC with the objective of writing an open-source design guide that can help merchant and donation recipient onboarding for bitcoin payments and gifts. The release also stated that they will use some of the funds to add a merchant section to the Bitcoin Design Guide, which is a resource for designing new bitcoin products, that will improve the bitcoin onboarding experience, targeting new companies, foundations, and donation-receiving organizations.
The second recipient of 0.50 BTC is Fodé Diop who will be creating a bitcoin programming course, Bitcoin Developers Academy, which aims to allow just about anyone around the world to learn how to program Bitcoin. The initial target will be individuals in West Africa and countries like Senegal who still use the CFA franc. A special shoutout and thanks to Manuel Stotz for making this happen.
The third recipient of 0.50 BTC is Bitcoin Core developer Vasil Dimov, who is known for implementing Tor v3, BIP155, and I2P support in Bitcoin Core. The money will be used on implementing CJDNS support, which will improve privacy and the security of the network against partitioning attacks. In addition to this Dimov will work on code review which will improve the testability of the networking code.
The fourth 0.50 BTC recipient is being awarded to another Bitcoin Core developer, Fanquake (Michael Ford). Fanquake has been contributing to Bitcoin Core since 2012 and has since then become a Bitcoin Core maintainer in 2019. The funds will be used to help him continue his work and make sure everything runs smoothly.
The fifth and final recipient of 0.50 BTC is a group of Bitcoiners organizing a program called Qala fellowship to find and grow local Nigerian talent, starting with developers to build careers in Bitcoin. The developers establishing this program are Bernard Parah, Carla Kirk-Cohen, Tim Akinbo, and Abubakar Nur Khalil. The program will consist of a six-month-long bootcamp on how to build on top of Bitcoin. Shout out to Bitcoin exchange Paxful for making this happen.
The Human Rights Foundation (HRF) is a nonpartisan, nonprofit 501(c)3 organization that promotes and protects human rights globally, with a focus on closed societies. Since June 2020 the HRF has allocated more than $900,000 to more than 25 developers and educators across the world. The HRF continues to raise support for the Bitcoin Development Fund, with the next round of gifts to be announced in Q4 of 2021.
They have previously given grants to top Bitcoin developers such as Gloria Zhao for Package Memepool Accept, Chris Belcher for Coinswap, Abubakar Nur Khalil for Nigerian Bitcoin user experience improvements, Muun Wallet for their mobile Lightning wallet, Sphinx for their Lightning-powered decentralized social media work, Janine for her Bitcoin privacy newsletter, Blockchain Commons for their Bitcoin internship program, and Arabic Hodl for his work translating important Bitcoin texts into Arabic.
The 2021 Oslo Freedom Forum, October 4 and 5 in Miami, will host a Bitcoin Academy to bring Bitcoin education to human rights activists.
The 2021 Oslo Freedom Forum, an international events series highlighting human rights activism, will host a Bitcoin Academy as one of its three programming tracks on October 4 and 5 in Miami, emphasizing the potential that this technology has for enabling freedom and sovereignty around the world.
A dedicated Bitcoin room at the event’s New World Theater venue will gather Bitcoin educators and promoters with attending human rights activists, policymakers and philanthropists, providing overviews and hands-on workshops to demonstrate how anyone in the world can access financial freedom through Bitcoin.
“The goal of the Bitcoin Academy is to put 100-plus dissidents and human rights activists from more than 40 countries in the same room as the world’s top Bitcoin educators and builders for two days,” explained Alex Gladstein, the chief strategy officer for Human Rights Foundation, which organizes the forum. “We’ll make meaningful strides towards teaching global communities how to achieve financial freedom and privacy in an increasingly controlled and surveilled world, and we’ll also get fresh ideas into the Bitcoin community from some of the most creative and brave individuals on the planet, who work daily under incredibly adversarial environments.”
As a free and open-source software, the Bitcoin network can be accessed by anyone, in any part of the world with an internet connection. It has proven to be a powerful tool for protest groups seeking to collect donations in the face of financial services bans, such as those supporting Nigeria’s #EndSARS movement. And it can provide a lifeline of financial savings for people whose fiat currency is unduly manipulated and devalued by authoritarian governments.
Through the Bitcoin Academy programming, the Oslo Freedom Forum seeks to enable more groups in need of such a permissionless, decentralized financial network to access it by demystifying its history, operations and practicality.
“Programming will focus on global Bitcoin adoption, the political history of Bitcoin, getting hands-on with the Lightning Network, learning how to receive donations and income in bitcoin, learning how to spend your bitcoin, learning how to sell bitcoin for fiat currency, learning how to use Bitcoin privately, learning about leveling up your security with multi-sig, discussing who controls Bitcoin, why Bitcoin mining is important, and sharing lessons from El Zonte about how to build a Bitcoin community,” per the Oslo Freedom Forum website.
Bitcoin Academy presenters and instructors include Elizabeth Stark, the CEO and founder of Lightning Network development firm Lightning Labs; Rockstar Dev, developer for open-source bitcoin payment processor BTCPay Server and Lightning Network platform Strike; Ray Youssef, the CEO of global Bitcoin exchange Paxful; and many more high-profile Bitcoin experts.
The Oslo Freedom Forum is currently accepting applications to apply.
On Friday, June 4, at Bitcoin 2021 in Miami, I had the opportunity to interview Square and Twitter CEO Jack Dorsey on the global adoption of Bitcoin and the future of money and social media. Here’s an edited transcript of our conversation.
Alex Gladstein: Hello Miami! And welcome Jack. We have 12,000 Bitcoiners here.
Jack Dorsey: [To the audience] You’re incredible.
A: And I think there’s 20,000 out there listening. We are happy to see this phenomenon grow. I wanted to start with the big question that most people are probably asking: Why are you on stage with a human rights activist? What does Bitcoin have anything to do with human rights? Isn’t it just about investment?
J: Not for me. For me Bitcoin changes absolutely everything. What I’m drawn to the most about it is the ethos, is what it represents, are the conditions that created it, which are so rare and so special and so precious. I don’t think there’s anything more important in my lifetime to work on and I don’t think there’s anything more enabling for people around the world.
A: We often hear in our community this mantra that Bitcoin is for everybody. That it’s non-discriminatory, that it’s open and opening for many people around the world who are walled off from transactions, saving, connecting with the world. What is your perspective on this idea that Bitcoin is for everybody?
J: That’s what I’m focused on making sure that I help with. Whatever I can do, whatever my companies can do to make Bitcoin accessible to everyone is how I’m going to spend the rest of my life. If I were not at Square or Twitter, I’d be working on Bitcoin. If it needed more help than Square and Twitter, I would leave them for Bitcoin. But I believe both companies have a role to play and I think anything we can do as companies to help find the right intersection between a corporate narrative and a community open narrative is for the best.
A: The theme for today is banking the unbanked. As you all probably know, there are billions of people around the world who are completely unbanked, or they are underbanked. Yet, the mobile phone is growing at a remarkable pace. Even in countries like Ethiopia and Sudan, you now have 20 or 25% of the population with a mobile phone, and in the next five years that’s going to pass 50%. So we are now in a position where the increase of technology is going to allow more people to come online and with Bitcoin it doesn’t matter what passport you have, or what nationality you are, or what ethnicity you are, or what you believe in, you can connect to this network. So when we think about banking the unbanked, what’s your vision for what is most important for helping onboard people into this new system?
J: Well, we don’t need the banks anymore. There’s so much work to do around accessibility, there’s so much work to do around education so that people can own the idea themselves. And I want to thank you by the way — I appreciate you so much for all the work you do to take away a bunch of the myths that people have in their head and give a strong case for why Bitcoin can be used by everyone — but we don’t need the financial institutions that we have today. We have one that is thriving, that is sound, that is owned by the community, that is driven by the community, and that has this incredible and amazing consensus that always manages to do the right thing over time. It’s noble. And it’s so rare and so unique. So anything we can do to build it and protect it, we’re down to do.
A: You recently personally launched a new fund with Jay-Z, where you guys dedicated 500 BTC to help the Bitcoin ecosystem in Africa and India. Can you talk a little bit more about the vision for that fund and what you all hope to do over the coming years?
J: I spent November of 2019 roaming around the continent of Africa, I went to Nigeria, I went to Ethiopia, I went to Ghana. And I saw that the number one problem that entrepreneurs were working on there — and I only met the entrepreneurs, I didn’t meet anyone in the government or the media — they are all working on payments and the most interesting of them were working on Bitcoin. And when I saw the reports of Nigeria considering banning Bitcoin, when I saw the reports of India considering banning Bitcoin, it was a reminder that we could use a lot more help developing around the world. Finding developers on the continent on Africa, enabling them to do their work without having to think about taking another job, is important. So, I talked to Jay about it. Jay loves Bitcoin, he goes very deep in what he loves, he believes in it, and he also believes in this idea of making sure that if we’re going to create a money for the world, it has to be developed around the world. And anywhere there are gaps, we should try to fill. So, right now we’re trying to find the right board for it. It’s going to be a completely separate entity. I have no control or say or direction over it. Once we find that board, we’ll hire a lead, and they’ll start making grants denominated in bitcoin.
A: So Jay might have 99 problems but being his own bank won’t be one.
J: [Laughs] He’s more than a bank.
A: Let’s speak a little more about that. Nigeria is a country of more than 200 million people. They have a 15% inflation rate. They are in many ways closed off from the outside world in terms of fintech and payments. How has traveling the world and going to different countries like this opened your eyes to the global impact of Bitcoin that maybe people in Wall Street or in Silicon Valley or in London may not be seeing? What are people missing when they say there is no social value to Bitcoin?
J: I mean they are missing everything. They’re not getting out of New York. Go to Nigeria for one day and see the struggle that people have to put up with, with their government and with their money. And go to Ghana that has a bunch of transplants from all over the continent and you witness the same thing every single day. Go to India and you see the same.
A: My advice is that they should try living on the Sudanese pound for six months and then come back and tell us that Bitcoin is not useful. And I think they’ll get a little reality check there. Today we’ve got maybe — and estimates vary — anywhere from 150 million to 200 million people have used Bitcoin in some way. So we’re at maybe 2% or 2.5% of the world population. I believe we’re going to a billion people by 2025, certainly by the end of the decade. When you have so many more people on-ramping into this system, we’re probably going to have a situation where fees on the main chain are going to get pretty high in fiat terms. So can you talk about — for people who like in Nigeria or Sudan who are going to need micropayments, who are going to want to send $5 or $10, can you talk a little bit about your commitment at Square to Lightning, how you understood how Bitcoin will scale in layers perhaps instead of on the main chain, and why you are so committed to Lighting in a time where we are going to get a lot more users?
J: That’s why I’m committed to Lightning, because this is going to be used by more and more people. My belief in bitcoin is that it’s an amazing asset, but my belief is that the internet needs a native currency, and we need to be able to transact with this every single day. And everyone around the world needs to transact with it every single day. So the only reason Square got into Bitcoin is to that end. It’s not just to be an exchange. And that’s why we don’t deal with any other “currencies” or “coins” because we’re so focused on making bitcoin the native currency for the internet.
Author’s note: at this point, political activist Laura Loomer came to the front of the stage and asked Dorsey how he could say this when Twitter is censoring users like her. She said “How can you say that bitcoin is a currency for everyone in the world, when you are the king of censorship? Bitcoin is about decentralization, and you have no right to be here today… censorship is a human rights violation.”
Dorsey responded by saying, “We’re working on that.” After a minute, Loomer was removed from the front stage area, and we continued the interview.
A: Why don’t we just go right to that issue? We hear a lot about censorship. Can social media be more like Bitcoin? Bitcoin is censorship resistant. Nobody controls it. What’s your thought on this? It’s a thorny problem.
J: Yes, I do believe it can. I know that there’s a lot of you out there who disagree with a lot of actions that Twitter has taken. I know there’s a lot of you out there who disagree with our policies and the way we have evolved them. I appreciate that and recognize it. I also recognize the fact that there is an incentive and a corporate incentive and a business incentive that is different than what might be needed for global communication and for a public conversation. And my goal in my life in this moment is to remove as much as I can the corporateness of our companies and find better intersections with the open-source community. Certainly, Bitcoin has taught me that with Square, and we’re doing everything in our power to do that. And we’re trying to do the same thing with Twitter, by creating a new platform, a new open-source standard called Blue Sky, we’re just starting it. And it will have none of the restrictions that you see on Twitter. Inspired entirely by Bitcoin. We want to do the same thing for social media. And again, I know you aren’t going to believe me. I know you’re saying “liar.” I’m going to prove it to you. And then we can have another conversation later.
A: When you look at something like Lightning, it’s not just a payments network, it can also be a censorship-resistant social media platform. There’s folks out there building stuff like Sphinx.
J: Sphinx is amazing.
A: Sphinx is really cool, basically what you can do is you can follow your favorite creators. Maybe your favorite podcast. Maybe you’re following what Marty and Matt are doing, and you can go into a “tribe” on Sphinx and you can stream them censorship-resistant private money on Lightning and nobody can stop you. And that’s happening. It’s inevitable. It’s coming. This vision to stream money to people that you care about, in a way that the government cannot stop, I know that’s what Laura wants, and that’s what you all want where you are upset with Twitter. Well guess what, it’s coming, and nobody can stop it. Maybe that’s a good segue to get back to the idea of Lightning and why you at Square and especially Square Crypto have focused so heavily on it as opposed to any number of other things. Why the focus on Lightning?
J: Again it goes back to the currency. Square Crypto and Steve and team and Matt have been focused on making sure that any wallet can easily turn on Lightning and to make this accessible to everyone. The more people we have considering using Bitcoin for payments, for tips, for streaming money, the stronger this ecosystem is and the more we achieve our goal.
A: We’re really building out a parallel economy here that is not controlled by governments or corporations. And I just wanted to show you how this works and then Jack and I can reflect on it. Our friend Jack Mallers has created a company called Strike, with a lot of help from a lot of other people — an amazing Bitcoin company — and he started a campaign recently to help Bitcoin development. So I’m on the Strike page right here. And I’m going to go ahead and donate $2 of bitcoin to Strike. I’m going to copy that Lightning invoice, I’m going to go to my Muun wallet — created by an awesome team in Argentina — and I’m going to send that Bitcoin right now and it’s going to go and it’s gone. That’s a bearer asset that has just moved instantly around the world. And I didn’t ask permission from anybody. So again we get back to this conflict about how are we going to build social media and communicate with each other without censorship and surveillance? It’s through Bitcoin. I just want to underline why I think Jack is so persistent in this. Because it must be such a struggle to watch the entire world criticize everything you do and I think that’s fair. We should do that and hold you to a higher standard.
J: You should definitely do that.
A: But this is not some magic fairy dust. This is real. Lightning is real. And I just sent a bearer asset around the world and nobody could stop me. I didn’t have to ask any permission, I didn’t have to prove my identification. This is an actual revolution. So when we talk about Bitcoin and Lightning, if we’re going to build it the right way, it has to be non-custodial. Now, minutes before you walked on stage, you announced something pretty big that you are going to do at Square. Do you want to talk about your vision for non-custodial Bitcoin use?
J: Yeah we’re considering building a non-custodial hardware wallet. The thing we want to do is make it completely in the open. From all of our software to all of our hardware design will be open source and will be on Github. We want to build it in collaboration with the community. So we started a thread today asking some questions about our design principles. We don’t want to compete with the hardware wallets out there. We just want to take it to the next level and take it to 100 million more people who have non-custodial solutions. And we’re likely to do it sometime very soon. But we wanted to make sure that we’re thinking about this in the correct way and that we’re reaching out to the right folks in the community to build it.
A: I think that non-custodial use of Bitcoin is so important. And Satoshi, the creator of Bitcoin, knew this. Satoshi chose his or her birthday as April 5. This was the day that the U.S. government basically banned private ownership of gold in 1933. So when Satoshi was designing Bitcoin he or she was thinking about how the U.S. government centralized and confiscated gold away from the people and how they could make a system that could prevent that. They chose the year for their birthday of 1973 which is when gold was made available for the American people again. So non-custodial use of Bitcoin is built into Satoshi’s vision for the project. So it’s really exciting to see Square support this. I think a lot of the custodians in the space won’t be very happy, but as you said earlier in your thread, as inspired by Isaiah, not your keys, not your cheese.
J: As a custodial exchange we need to push more companies like us to make sure that more people have non-custodial solutions. And we’re going to show up.
A: Earlier you brought up a point that you are Bitcoin only. Let’s talk a little bit more about that. There’s a lot of discussion about proof of stake and other coins. What are your thoughts on Bitcoin and its proof of work and full nodes model versus other models?
J: Again, the conditions that created Bitcoin — everything that went into it from the proof-of-work model to the development model — no single points of failure — everything about it is why we’re into it. There’s nothing else that compares to it. And we have no interest other than making sure that we are building a native currency for the internet and helping in every way that we can. So all the other coins to me don’t factor in at all.
A: Bitcoin is about user control. Users control the monetary policy. You control it, you control it, I control it. There’s not a small group of people controlling the monetary policy. And that’s really what we are here for. We’re here to create an alternative to the fiat system where a small group of people can basically determine the rules. I was in a meeting yesterday with an amazing guy named Fodé Diop from Senegal, and he’s telling me this story from the late 1990s. Where he is living in a country that uses the CFA. It’s a French colonial currency so the French in Paris control these people and they make decisions on behalf of them. His father had saved up all this money for him to go to college and the French just decided to devalue the currency overnight. And he could no longer pursue his dreams. That’s why when he saw Bitcoin later he was so open to it and excited and he said, this is my ticket out of here. At the end of the day the difference between Bitcoin and all the other coins is that with Bitcoin, we control the monetary policy, it’s not going to change, and with every single other coin, it’s up to some small group of people who are going to, best case, do their best.
J: Until they don’t. Until they get corrupted in some other way.
A: The track record for this globally is not so great. There’s always this temptation to print more to fix the problems. Well, you can’t do that with Bitcoin.
Now, when we talk about other digital currencies, there is a digital currency phenomenon that I did want to talk to you about and that’s central bank digital currencies. So it appears that around the world there’s this drive to move beyond paper cash and bring us to a system where citizens actually may have a liability of the central bank on their phone, as opposed to using paper money. This obviously presents a lot of civil liberties concerns. Even Christine Lagarde has said that the digital euro won’t really have full privacy. Obviously the Chinese government is pursuing an aggressive CBDC. These things are likely to lead to forced spending, negative interest rates, confiscation, blacklists. This is all happening, there’s this war on cash. What are your thoughts on this idea of financial freedom and privacy in a world that is moving beyond paper money?
J: I think all of the things that you mentioned in terms of what central banks are trying to do are just bumps in the road and they are bullshit. We have a much better alternative in Bitcoin. We have designs for that privacy and that freedom within it. The more that we — and especially our governments — can realize that and get in the boat sooner, the better we all are.
A: A lot of people say Bitcoin is just for bad people. It’s just for bad actors. What’s your response to that — that it’s just for criminals, the same sort of stuff that they said in the early ’90s about encryption. Right, they said it’s going to be for bad people, we don’t want Americans to have privacy. Well thankfully the cypherpunks make it possible for us to have tools like Signal. What is your response when you talk to regulators or government officials and when they say this is just too risky or it’s going to hurt people?
J: It feels like it’s a cover for something else going on. I don’t actually hear that a lot from regulators. Square was one of the first companies that was public that talked to the SEC [U.S. Securities and Exchange Commission] about Bitcoin and that never came up. So it feels like there’s probably something a little bit deeper when you’re hearing any of these excuses and it’s just about trying to understand what that really is. I think it’s just about losing power, effectively.
A: One of the interesting things about Bitcoin is how the incentives align. Recently there was a little bit of a controversy with some of the companies that are doing Bitcoin mining, and a software upgrade that’s going to bring new privacy to Bitcoin called Taproot, which is in the process of activating right now, which is very exciting, but one of these companies, they weren’t signaling for Taproot. And then there was this huge community backlash and the company was actually forced to come out with a video message and say ‘sorry, we’re definitely going to signal.’ They basically bent the knee to the community. Have you seen that unique phenomenon before?
J: It was awesome.
A: Where a corporation is virtue signaling for censorship-resistance and privacy? What do you see when you look at stuff like that?
J: It was awesome the community could change the path and the mindset. I think it’s incredible. I don’t know why it didn’t happen sooner but it’s just another lesson for any company trying to get into the space.
A: There’s a lot of people who say Wall Street’s just going to control Bitcoin. They are just going to make it a tool for themselves. This is a nice example of how that’s probably not the case.
J: It can’t and it never will, it never will. And the more companies, small, big, that try to demonstrate that and try to offset their corporateness by doing things that are more supportive of the community such as creating a Square Crypto-like thing, such as creating a [Cryptocurrency Open Patent Alliance] COPA-like thing to give up Bitcoin patents to protect the community, it becomes more and more resilient every single day.
A: I often think about how the world is focused on the micro-movements of the bitcoin exchange rate versus the dollar. And meanwhile this incredible foundational upgrade has essentially been transformed into reality by the users and nobody is paying attention to this. It’s kind of interesting, right, it’s almost like running interference for the real revolution.
J: It’s working, it’s incredible.
A: I wanted to hit another topic. We hear a lot about Bitcoin’s energy use. And you all at Square just put out a paper with Ark that described how actually, Bitcoin mining might incentivize the adoption of renewable energy and it may actually help unlock renewable sources that are stranded or otherwise unused around the world. Can you talk to us a little bit about why you have this belief or philosophy that Bitcoin mining is actually helpful for our species and our planet?
J: You just look at the economics of it and ultimately miners have to make a profit. And getting cheap renewable energy maximizes their potential for profit. It’s really that simple. And I thought I had an agreement with some notable figures out there, and that seemed to change in a matter of weeks and now it’s in a weird kind of place. But I believe fully that Bitcoin over time and today does incentivize more renewable energy. And I think it does incentivize more awareness around how we’re getting that power and gives people more freedom to convert unused, wasted power into something that provides value for billions of people around the world.
A: Just a couple facts I’d throw out to the audience. The U.S. government this year is decommissioning for political reasons more nuclear power than is necessary to essentially power the entire Bitcoin network. We need to think carefully about energy and waste and the environment but there’s more than meets the eye here and I’d encourage all of you to dig in and learn more about Bitcoin mining.
I also wanted to share briefly this example of how it could benefit people in emerging markets. So a lot of philanthropists and outside investors have been trying to help Virunga National Park in the DRC, in the Congo. And they’ve been building some hydro facilities there, they have this mighty river, and incredible natural resources, but the problem is when they build the dam it takes time to connect the transmission lines to the dam, so the project remains fairly inert for awhile, and it’s not that exciting of a development project for that reason. But about a year and half ago, the people who run the park — which, by the way, is an incredible park that supports an area of five million people and some of the most amazing wildlife on the planet — they decided to start Bitcoin mining. And it gave them a source of revenue that can allow them to bootstrap the rest of their operations. And more of this is coming online across the country. This is going to happen in so many countries that can start unlocking solar, wind, renewable, you name it. They are going to start realizing that this can help bootstrap them into some energy independence. I think that’s important for you to consider when you are reading these headlines about how Bitcoin is boiling the oceans, you need to think deeper.
J: 100%. Well said.
A: We’re going to wrap up. I have one more thing to say. 32 years ago today, these incredibly brave students in Tiananmen Square stood up for freedom. The Chinese people are still fighting that fight today, especially the Uyghur people, especially the Tibetan people, especially people in Hong Kong. We often hear that Bitcoin is a threat to America and is a threat to our values. But is it really? Isn’t Bitcoin’s free speech and property rights and sovereignty, don’t you think that vibes better with us than a closed, Communist police state? Don’t you think that we’re going to benefit a little more than some other countries? Could you even say that Bitcoin is patriotic?
J: 100%. But I think Bitcoin benefits the entire world. That’s what makes it incredible. Is that every single person in the world will benefit and get value from utilizing this. And the more accessible we can make it — just that realization that we finally have a currency that can be traded to any single point on the planet — is pretty incredible and what that enables going forward is mind-blowing. And I’m going to do everything in my power to make sure that happens.
A: This concept that Bitcoin is for everyone is I think what I want you to go home with. Bitcoin is non-discriminatory, it cannot choose who uses it, and none of you can block our access or her access, or his access, it is something that is open for all of us, and it’s open source, and as a human rights activist I am grateful that companies like Square are supporting the open-source side of Bitcoin, are supporting non-custodial use, are supporting Lightning — these are things that I don’t think may have been possible before Bitcoin’s incentive structure. So I really wanted to thank you Jack for coming out and sharing your thoughts. It’s obviously a tricky political situation out there but I think we agree that Bitcoin is the way forward.
J: 100%. It’s the only way out.
This is a guest post by Alex Gladstein. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
Six Bitcoin projects will receive funds from the Human Rights Foundation (HRF) to propel their growth. The Bitcoin Development Fund’s latest round totals $210,000 and is directed to three Bitcoin Core contributors, two Lightning Network wallet teams, and an Arabic translator.
The donations for this round, including the support from Anthony Pompliano’s Bitcoin Pizza Day sales and Cygni Capital, were led by Jaewoo Cho, assistant professor at Hansung University and an anonymous crypto investor, RenoHQ.
Calvin Kim, Dhruv Mehta, and Abubakar Nur Kahlil, Bitcoin core contributors, will each be awarded $50,000; $25,000 will be picked up by the Breez and Sphinx wallet teams, and Arabic_HODL will get $10,000.
Kim will make use of the funds for Utreexo, a node-scaling project that takes Bitcoin’s history of transactions and displays them in a kilobyte of data, lowering the time and effort required to bootstrap the Bitcoin’s backbone node software.
Based on Bitcoin Improvement Proposal 318, Mehta will keep working on security for Bitcoin to limit vectors for Sybil attacks on Bitcoin nodes. In his home country Nigeria, where Bitcoin’s acceptance is growing in response to policy bribery and capital restriction, Kahlil will work on a wallet purpose-built.
Sphinx Chat, a wallet and encrypted message service for Lightning Network users that enables them to chat through the network, will utilize its grants to create a directory for its users to connect with humanitarian activists.
Breez, another Lightning Network wallet, will utilize its money to develop its encrypted chat capabilities and improve node backup support.
Meanwhile, Arabic _HODL will keep up its work of translating Bitcoin content into Arabic.
It may be the HRF’s diversified and worldwide round with recipients from Korea, Nigeria, the Middle East, and others. Bitcoin developers, journalists, and other community members were given grants last year, and over $800,000 has been granted in Bitcoin to 18 beneficiaries and projects since its start in May last year.
Also heavily donated to bitcoin developers and other community members in the past year were Square Crypto, BitMEX, Kraken, Gemini, and other Bitcoin and crypto companies. These grants can be a financial lifeline for coders that previously have been free to work on Bitcoin’s software for an open-source ecosystem, like Bitcoin.
In March this year, HRF received a wave of donations for the Bitcoin Development Fund. These donations supported Bitcoin development, a privacy newsletter, an open-source wallet, new user education, and internships for students.
Notably, all funds to the Bitcoin Development Fund in USD or BTC are used to improve the Bitcoin network. 95% of the funds go directly to the chosen developers, while the remaining 5% support HRF’s human rights advocacy mission.
Popular crypto derivatives exchange BitMEX has announced a $150,000 grant for Calvin Kim — a Korean-based Bitcoin scaling researcher.
The grant comprises the second instance in which BitMEX has backed Kim’s research, with the exchange donating $30,000 to Kim in August 2020.
For his current research, Kim plans to implement Utreexo into Bitcoin deployments using the Go and Rust programming languages respectively, while also working on “improving the initial block download time in Bitcoin.”
Utreexo is a Bitcoin scaling solution and hash accumulator that Kim has been working on since mid-2019, with the protocol’s design having first been proposed by MIT Digital Currency Initiative researcher Thaddeus Dryja — who also co-authored the Lightning Network whitepaper.
The new grant was issued by BitMEX in collaboration with the non-profit Human Rights Foundation, or HRF — an organization that supports human rights activism globally — with the HRF contributing $50,000 on top of BitMEX’s $100,000 one-year grant for Kim. The researcher stated:
“This year, with the financial support of BitMEX and the Human Rights Foundation, I intend to continue what I was doing last year and continue moving the Utreexo project to something a user can download and use.”
In a May 31 announcement published BitMEX’s research branch, the HRF noted that it has long “worked to promote human rights on the Korean peninsula through technology,” and that it hopes to inspire others from the region to get involved with Bitcoin.
“It is exciting for HRF to have the opportunity to bolster Calvin’s efforts and we hope that his work can inspire others from the region to get involved with Bitcoin and contribute to its mission to provide open-source freedom money for the world,” HRF said.
According to the organization’s website, the HRF support Bitcoin because it “can be a tool of freedom for human rights defenders facing hyperinflation or financial surveillance.”
The HRF’s $50,000 grant to Kim is part of the organization’s $210,000 Bitcoin Development Fund, which also included collaborations with Gemini exchange and Square Crypto in support of developer, Dhruv Mehta.
Mehta received $50,000 to work on increasing Bitcoin’s censorship-resistance through BIP324 — a peer-to-peer message transport protocol that aims to protect Bitcoin peers against man-in-the-middle attacks on seed nodes.
The fund also included $50,000 of support to Nur Khalil, a Nigerian Bitcoin developer who develops Bitcoin wallet software for the Nigerian context.
The Human Rights Foundation has awarded $210,000 in grants to propel six Bitcoin projects, including developers and Lightning apps.
The Human Rights Foundation (HRF) Bitcoin Development Fund’s latest round will award a total of $210,000 to three Bitcoin Core contributors, two Lightning Network wallet teams and an Arabic translator.
“This round of gifts will focus on: Bitcoin core development, making it easier to run nodes and making it harder to Sybil attack nodes, wallet optimization for emerging markets, privacy improvements for Lightning apps, [and] expanding arabic language Bitcoin education and translation,” announced HRF Chief Strategy Officer Alex Gladstein.
HRF will award the largest sum to the Bitcoin Core developers Calvin Kim, Dhruv Mehta and Abubakar Nur Khalil –– who will receive $50,000 each.
Kim currently researches ways to scale the Bitcoin base layer with the Utreexo client and has recently shown promising results. With this new grant, Kim will take it a step further and work “towards making Utreexo usable by an end user,” he shared on Twitter.
Meanwhile, Mehta will continue working on Bitcoin Core’s security, while Khalil will be working on wallet optimization for his home country of Nigeria.
The Lightning Network app ecosystem will receive two grants, each totaling $25,000. According to the announcement, Sphinx Chat, a Lightning wallet and encrypted messaging service that allows for chatting over Lightning, will use its grant for a new donation interface for humanitarians and activists. And Breez, another Lightning wallet, will dedicate its funding towards bounties to add Tor and NextCloud to its platform and integrate Lightning with Matrix.
Finally, Arabic HODL will use its $10,000 grant to continue translating Bitcoin content into Arabic.
BitMEX and the Human Rights Foundation have partnered to award Bitcoin Developer Calvin Kim $150,000 to further his work on Utreexo.
Bitcoin exchange and derivatives platform BitMEX has announced that it has renewed a developer grant awarded to Calvin Kim until June 2022, giving him an additional $100,000 one-year grant. BitMEX awarded Kim a $30,000 grant in August 2020.
The announcement also indicated that the Human Rights Foundation (HRF) is granting Kim an additional $50,000 in bitcoin.
Kim was focused on prototyping an Utreexo Bitcoin full node, which can help users conduct the Initial Block Download 62% faster than through Bitcoin Core alone, according to recent BitMEX research.
“This year, with the financial support of BitMEX and the Human Rights Foundation, I intend to continue what I was doing last year and continue moving the Utreexo project to something a user can download and use,” Kim said, per the announcement. “I’m excited for the upcoming year of development for the Utreexo project and am confident that the project will have a positive impact on the Bitcoin ecosystem.”
BitMEX and HRF have been active in donating to Bitcoin development. BitMEX parent company 100x Group has donated $250,000 to Bitcoin Core maintainer Michael Ford (aka Fanquake). And the firm has previously given a $150,000 grant to Core developer Amiti Uttarwar.
HRF’s donation efforts have focused on supporting privacy development for Bitcoin.