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The B Foundation

Speakers: Alena Vranova

Transcript By: Bryan Bishop

Category: Conference

The B Foundation


I think most people here have some idea of who I am. I am a long-term bitcoiner. I’ve been in bitcoin since 2010. I love bitcoin. I am passionate about it. I want to see it grow and prosper. The positive thing about bitcoin is that it has a resilient ecosystem. It doesn’t need any CEO. It doesn’t need any centralized organization and it doesn’t need any central point to direct where it is going. It basically works.

At the same time, I have to say that centralized efforts are much more effective. If you have an Ethereum Foundation with a marketing department and promotions and creates beautiful sleek-looking material and produces materials, it’s much more effective in the short-term. I spent a great deal of time in the last year or year and a half visiting many blockchain events to see what’s really happening and what’s happening outside of our cute little bitcoin bubble that we like because it’s cozy.

I went to those events, it was sad to see, but a lot of market participants are reaching out to nonsense technology that doesn’t really solve their problems or they could easily reach to bitcoin for what they need. There’s a lot of hype around other projects that is undeserved, and bitcoin deserves much more communication, attention and joint efforts.

I tried to think about what all the market participants think. I may be wrong. This is how I feel about the development in bitcoin. After the segwit deployment, I feel like development has skyrocketed and it’s really moving forward although there’s still a lot of things to do. Bitcoin development I feel is not so sexy as for other blockchains because they do ICOs and there’s just more money. Bitcoin is much more complex and it’s not so easy. Can we make it more attractive?

Investors… they want their 50x returns. You have crypto investors going for fast returns. They focus on tokens. There’s the venture capital herd mentality. They are herd VCs. They feel the hype. They go after hype. They have limited understanding of the tech. The strategic investors are the bitcoin allies.

There’s hodlers, but they always wait for the moon. When moon? When SPEDN? And traders are also significant part of the ecosystem because htey create the volume but the economic value they bring is not that huge. There’s als ocorporations- blockchain is probably the thing, but our own. They each want an ERC20 token, and bitcoin is a reputational risk for them, and they consider bitcoin slow and they want smart contracts which they think bitcoin doesn’t have. Merchants not sure how or why to adopt bitcoin, it’s too nerdy, too volatile, how to do accounting, who trains my staff, and nobody spends BTC because nobody has BTC.

There are influencers like the pop stars in social media, are schilling tokens and stablecoins instead of looking into bitcoin. Policymakers are trying to take ownership of bitcoin and other projects and rule it and put in KYC and AML.

The most important part of the ecosystem is “Your Mom”. They believe bitcoin is internet money for criminals and crazy people, it’s not backed by anything and doesn’t have intrinsic value, it consumes too much energy, it’s too volatile to serve as money, it’s too nerdy and unusable, it’s too complex to buy and use and store it. It’s several years of media brainwashing.

I was upset about this. I want to see bitcoin succeed. What can we do about this? What can I do about that? I love decentralization but maybe if we sit down together and a few smart people can pool some money together and direct some efforts towards that. I believe I understand the needs but please if I have misunderstood then please feel free to speak up. For developers, if we get more developers then that would be nice. There is a need not just for Core developers but basically application developers and middleware developers. Investors and corporations just need to understand the capacities of bitcoin. The next year I go to blockchain events, I want these people to say ah we’ve been considering bitcoin because we only need a token or that’s what we need or we only need to do some timestamping. They should use bitcoin because it’s there, maintained, stable and secure. This is sometihng I want to shift the perception to. The hodlers need good security, usable multisig, self-custody and better privacy especially if one day they decide not to hold but to spend. For merchants, I feel like merchants should only have to click one button and have everything done and not have to study anything online or ask people for help. For influencers, they need better reasons to show bitcoin. I don’t know how to go about it, but I hope we will find out. I wish that policymakers would finally understand that bitcoin is not theirs to take. It’s not something that fits into their brackets. We’re so early in this space that we’re still defining bitcoin. They are still trying to put their labels on this and put it into some legal framework. I think that’s a mistake and we should communicate that. And “your mom” should have an amazing experience and not even think about what she’s doing.

I asked a few people from this space to help me with this, including Giacomo Zucco with BHB Network. You know him, please give him applause. First of all, don’t worry. I will be super fast. Since 2013, in the last 5 years, I wanted to find a way to help bitcoin development. Any kind of business I created, was an excuse to allow me to take part in this revolution. It has to be sustainable. But I really wanted to help bitcoin somehow. A big part of this is personal selfish reasons. Maybe in my presentation you see the BHB Network is the same logo as honeybadger. It doesn’t really mean anything. What is BHB? I will tell you about my experiences in one miunte while exploring different models for bitcoin development.

Does bitcoin need any kind of help? Does bitcoin need us to push something, fund something or whatever? In the long run, bitcoin does not need any specific coordinated central effort in order to succeed. You could say, better safe than sorry, so let’s do it anyway. But I put a question mark here because I think bitcoin in the long run could succeed without any kind of concentrated or coordinated effort. But in the short run, we’re witnessing that in the absence of coordination there’s a lot of waste of resources, time, money, brainpower, there’s developers wasting their productive life into ethereum or other projects. There’s a lot of misallocation of resources and this is slowing down bitcoin development and adoption and it’s destroying value in the mean time. Maybe bitcoin doesn’t need us to step in for the long run, but I do think it requires us to take action to prevent misallocation.

The current models for bitcoin are these three– the first is hold and build. You buy bitcoin, and you develop applications or other value-added service. Step 3, profit because the price of bitcoin goes up. You don’t need an organization to do that. This is what I started with in 2013. I quit my job, I started to help meetups with my money hoping that my little bitcoin stash was going to grow into more valuable. It didn’t work out very well, because I spent more bitcoin than the increase in value, but it was an experiment. It’s good for alignment of incentives because you really want bitcoin to succeed if you are holding. But there’s also free riding, like you can just sit and do nothing and get rich with bitcoin. In the long run, it’s not sustainable. If bitcoin reaches a plateau or something, like with hyperbitcoinization, then we’re in trouble with this model.

In 2015, I was trying the Redhat model. This is something that many people in the space are experimenting with. We work on open-source development for free, but since we work on it, we’re the experts, and we can sell consulting or customization and education and support and other value-added services. So this is what I have done with my company. The problem with this is that it may be sustainable, but it’s not scalable in the same way as high-growth tech startups are. It’s very time consuming to add consultancy value. The expert is just you, and it doesn’t scale. There might be some conflicts of interest because maybe you want to keep some of the information from spreading in the open because you want to make it more valuable or the other way around you want to influence the project differently because of your commercial interests. Or the other way around, the desire to help open-source projects can damage your business. Many times, I crippled my own business because I was eager to disclose stuff or get freebies or free lessons, free workshops, a lot of information very valuable just dumped. Also, there’s a huge cognitive dissonance inside the company. Half the company was part-time uncle scrooge and part-time santa clause. It was very schizophrenic– I’m giving everything away for free, but you have to pay, etc. It’s very confusing. The accountants were going crazy because it’s confusing.

The third possible model is the Linux Foundation model where you’re a non-profit company. The for-profit company just donates some of the profit to a separate entity with the specific goal to use the money to boost the development of open-source software. This is nice because it causes less confusion. This also has some cons. It is very centralized because you cannot have 20 Linux Foundations. You can have 20 Redhat style companies but you can’t have 20 Linux Foundations. So then you centralize and this creates fragility, it could lose transparency, it could lose focus, it is corruptible.

This is https://theB.foundation/ - the B foundation. This logo was created 1 hour. I insist to keep this symbol as the official symbol forever. It’s perfect. We have secured the domain already. It’s not the bitcoin foundation, it’s the B foundation. It’s just “the B”. It’s a foundation. It’s “The B”. ((applause))

A few words about the foundation and the effort. It’s about bitcoin and lightning network development are the main focus. We might have some side projects like privacy-related projects like tor, freenet, stuff like that, bittorrent, but mostly bitcoin and lightning network. Simple website to match donors and projects, we want to show projects that could use financial help, and donors that could provide this financial help. This website will be overseen by a board of very knowledgeable and reputable advisors. The advisors will organize the project in a clear way. There will be a hierarchy of specific projects and you can decide to earmark your money to bitcoin marketing & PR or bitcoin usability projects or one-click installation full node or something along the lines like Nicolas Dorier is doing right now, like UX-oriented development. And a lot of bitcoin R&D. I’m schilling these RGB project which has been called a non-profit scam platform, which is a very correct definition. We will need a high-level root donation so that the website can stay online. The higher you donate in the tree, then the more you donate, then the more visibility you receive. We will accept and solicit donations from anonymous donations. Alena is working from the other side to do that.

The B Foundation will be based in Liechtenstein because of the bitcoin support savvy government. The foundation will be mixed charitable and commercial. The governance will be based on a council (for legal), executive team (director, executive assistant, etc), and the board will be non-paid. The donors will be based on no state run funds, early bitcoiners, bitcoin businesses, and based on acknowledgement or allow the donors to have anonymity. Commercial projects to “feed the monster” - long-term sustainability, no dividends for foundation council or advisors. The advisors will make sure that we’re not buying lambos for ourselves. We don’t want to take money from the state because that’s tax money and taxes are a crime. It’s stolen money. We’re happy to accept altcoins as well, although we’re just going to convert them to bitcoin. We can do short-term projects and programming bounties and sponsoring scholarships for students and so on, but it allows us to invest in actual commercial bitcoin businesses. We can create long-term sustainable type of organization.

We have stark, pavol rusnak, adam3us, lopp, petrov, we will have a meeting tonight to advance the project for people who want to take part. The advisory board will be for advisors- not mainly developers. We will have people that try to help coordinate the overview and review the process.

This is the vision for a Bitcoin Foundation that I have wanted to see for a long time. I was never a member of that other foundation. I was actually one of the first people who applied for a developer grant from that foundation. I had learned 3 years later that I had won the grant for statoshi but I had learned that due to internal issues, the grant program had been disbanded and the whole thing fell apart since then.

We’re not bothering kanzure because he’s busy writing, there’s lots of other people involved here. Priorities this year was to establish the advisory board, the donation workflow, have all the technical mechanical turks working. Then raise funds. That’s basically the goal for this year.

Next year, we want to go for with it and start working with the media to start debunking the typical myths, start working on amazing bitcoin UX and one-click lightning nodes for example. Maybe some fun gaming experiences. We want to work on Satoshka, a comic strip character, a bitcoin hero that can be used for any kind of materials like fun games or anything that can bring in people from outside of bitcoin. This has been designed by Alena herself in a few minutes on her ipad. True story.

The next goal is to have at least 500 new developers trained with scholarships. I don’t mean teaching them basic php, but we will probably approach universities that have programming courses and help those young people get some quick courses and scholarships for bitcoin coding because these are typically people who are smart and they want to do cool stuff but they don’t have the money to pay a few thousand dollars for training.

We want to donate at least $1 million of BTC towards R&D around privacy, fungibility, bitcoin’s smart functionality. These are the priorities for the short-term.

How can you help? I hope you want to. You can follow the newly established TheB_Foundation twitter handle. You can also email me at alenasatoshi@protonmail.com and giacomo@bhbnetwork.com … Full disclosure, this is my personal wallet on this slide. I pledge to forward any of these funds to the foundation’s wallet. Please contact us first if you want to donate larger funds. Policymakers still think we need to do KYC, so we will need to do that on larger sums.