It was the last hour of the final day at Paris Blockchain Week Summit. The charismatic Binance CFO Wei Zhao had been speaking back to back. Yet, despite the time and the fact that he must have repeated himself over and over for two solid days, he seemed undeterred. Wearing jeans and a Binance hoodie, he bounded up to meet me, vigorously shaking my hand, clearly enjoying being the man of the moment.
If this were a celebrity party, Binance would be the VIP guest. Changpeng Zhao (CZ)’s creation seems unstoppable. Every project wants to be on Binance, from regular token listings to holding IEOs on the Binance LaunchPad. The Binance Chain has just launched, its native BNB token is climbing in price, and the company has the power to influence the entire community and delist tokens at will.
Binance Won’t Be Leaving Malta Any Time Soon
Minister for Digital Affairs Cedric O later said in a press conference that one of their goals was attracting Binance to France. Yet Zhao confessed to me that he had no idea the French had pushed forward new regulation until now.
With a rather high taxation rate for crypto companies at 30 percent, regulations around ICOs (that no one’s doing anymore) and a lot less flexibility than Malta, it looks unlikely that Binance will move to France anytime soon. Although I wasn’t privy to any backroom chats.
My interview was with Wei Zhao, the man partially responsible for Binance’s epic growth. “I help companies to scale and to grow,” he tells me. Binance now has over 400 people in 30 countries. That’s “a decent sized organization.”
One thing that I have helped to launch is our fiat to crypto offering. In January, we launched our fiat to crypto, pound to BTC. We’re also doing Singapore. Last year, we launched in Uganda… My approach has been basically to build up our presence in the regulated world and build up more fiat.
Bridging the Traditional Financial World with Crypto
With a background of working in traditional finance, and grooming companies to go public, it’s unsurprising that another major focus of Zhao is institutional investors.
“I worked in Hong Kong, so I’ve been CFO for about four different companies, two of which went public. So, I am quite adept in dealing with bankers, and working with bankers, I am a banker myself. I helped to launch our OTC trading services, Binance off-exchange services. I help bring people from traditional bond traders and that type of trader to cryptocurrency.”
Indeed, the surge in Binance’s OTC trading drove the company’s near $80 million first-quarter profits.
What It’s Like Working at Binance
I ask why he made the leap from traditional finance to crypto. He says he would not have done it for any other company than Binance.
I think we are really different from other companies. Most are just exchanges, but we really fiercely want to make an impact in the world… The journey has been awesome so far and I’m in it for the long haul.
One of the best things about his job? Traveling to different places. “I flew around the world four or five times already,” he laughs.
It does speak to the borderless nature of cryptocurrencies. Yes, it’s a digital business but at the end of the day, it’s still a human business, it’s a very human business. The reason this industry is growing so much is that people in this industry travel so much. Like 10 times more than in any other industry.
There’s nothing like human interaction, face to face human talking about things, that’s how you can really impact change.
Does the Recent Leap in Bitcoin Mean the Bear Market Is Over?
It’s not a decisive “yes” when I ask if the bear market is over. Zhao pauses and leans back in his chair. There’s a short silence before he forms his answer, leading me to believe the opposite may be true. But with the most profitable exchange in crypto, bear market or no, nothing’s stopping Binance. He says:
I think there’s generally a lot more interest across the board despite adverse regulation and other adversities. You see general interest in bitcoin from traditional industries, and the rest of the world is showing interest in projects and I think all of it will contribute to the continued growth of the market. The fact that people are thinking “how is this going to impact my business?” Facebook JPMorgan… it lends credibility to the space.
I ask if companies like JPMorgan and Facebook lending “credibility” is rather ironic, considering how Bitcoin was born. He replies:
You need a push which is driven by guys like Facebook and JPMorgan, that gets people thinking about how that’s going to impact institutions and the market. It lends credibility, mindshare, and shows that our actions are getting noticed, that’s what it takes.
What It’s Like Working with CZ
So, what’s it like working with one of crypto’s biggest personalities? “Awesome, it really is awesome!” he enthuses, “he’s extremely transparent, diligent and extremely honest, he’s also extremely intelligent, and very patient.”
I ask if he was in complete agreement about the recent delisting of Bitcoin SV, to which he nods his head. Presumably, he’s been fielding questions on the subject all day long and his answer is extremely diplomatic.
“We have a very rigorous delisting process, and we also have a regular quarterly review. This quarter a lot of the comments we’ve written out our rationality… I don’t have any other comments on that.”
Finally then, who does Zhao believe that Satoshi Nakamoto is? Clearly, not Craig Wright.
“I think its a community,” he replies. “It’s like ‘I am Bitcoin’, you know that movie? ‘I am bah, blah blah’? It’s like that with Bitcoin. It’s a community. And we’re surviving… I believe that every day that you survive extends your survival… There is a reason why he or she wants to remain anonymous, because it’s not important, it’s a community.”
What do you think of Zhao’s comments? Let us know your thoughts below!
Max Keiser shares his thoughts with Bitcoinist on JPM Coin, Warren Buffet’s anti-Bitcoin comments, and what ‘permanent QE’ means for BTC price in the future.
Max Keiser: JPM Coin a ‘Hot Steaming Pile of Dog Crap’
Bitcoinist: Are your surprised that JPMorgan revealed its JPM Coin after bashing Bitcoin for years?
Max Keiser: JP Morgan is years behind and may never catch up in the cryptocurrency space. It’s laughable Jamie Dimon has been very vocal criticizing Bitcoin as a way to try and stop it and that didn’t work. Honey Badger don’t care. Now he’s trying to compete with his insecure, centralized, hot steaming pile of dog crap called JPM Coin. LOL.
Warren Buffet recently called Bitcoin a “delusion” that attracts charlatans. Why are top execs like Dimon and Buffet so vehemently opposed to Bitcoin (but not ‘blockchain)?
Buffett’s returns are tied directly to the Ponzi-economics of fractional reserve, illicit money printing by banks and central banks, market rigging and accounting fraud – all made easy – thanks to the absence of Hard Money in our economy.
Of course, Buffett hates Bitcoin and Gold for the same reason thieves hate locks and bacteria hate antibiotics. Buffett is a scammer who prints money via the banks he’s involved with to buy monopoly positions in large American companies that he then rips apart with mass-layoffs and stock buybacks. He’s the Charles Manson of Wall Street.
In our past interview, you said that the 2018 Bitcoin bear market was the result of the USD strengthening amid expected rate hikes. How will bitcoin react to the Fed now going into ‘permanent QE’ in 2019?
The trend in Bitcoin’s price flipped from bear to bull once the Fed said it would ease-off tightening and engage in permanent money printing (‘permanent QE’). This, by the way, is the definition of debt-monetization, which means the door has been opened to a hyperinflationary currency collapse of the USD.
Since you always say “you can’t taper a Ponzi” are negative interest rates inevitable? What does this mean for cash and how will it affect bitcoin?
Nine trillion in global sovereign debt has been issued with a negative interest rate (buyers lock in a loss if held to maturity). Negative rates are coming to retail bank accounts. This is wealth confiscation by the bank cartels to keep their insolvent balance sheets from imploding. The impact on Bitcoin and Gold will be moving to new ATH as safe-haven money pours in.
Bitcoin isn’t like a commodity since it’s production (of blocks) is constant regardless of demand. It’s not really like a stock either since its supply is hard-capped. Even Satoshi called it “bloody hard” to write a description for it since there’s “nothing to relate it to.” How would you classify Bitcoin? Is an entirely new definition needed?
Correct. Bitcoin is an entirely new asset class that so far has eluded definition by anyone. I could expand on this more, but for the purpose of this interview, suffice to say, that some surprises are still to come in terms of how Bitcoin interacts with the global economy and how every definition of money, economics and finance will have to be rewritten.
You also believe that hard money like Bitcoin discourages starting wars. Can you talk a little bit more on this considering the latest tensions in Venezuela and Kashmir?
Fairtrade using Hard Money is peaceful. Unfair trade using unsound money, like fiat money, causes tension, resentments, violence, and wars.
Venezuela is a money printing basket case that is printing its way into the loss of sovereignty. If they switched to Bitcoin and/or Gold they could keep their sovereignty. The same can be said for India and Pakistan. The only country in the world that seems to understand this is Russia. They are aggressively stockpiling Gold and I’m hearing from Kremlin sources they will be adding Bitcoin later this year.
What are your thoughts on the ‘bitcoin mining is wasteful and bad for the planet’ argument?
It’s a dumb, non-starter argument. If anything, bitcoin mining is an incredible reduction in energy usage:
It promotes renewables for efficiency, bitcoin miners are portable, they go wherever there’s excess energy that is going to waste.
As the USD (and other paper money) collapses – energy usage by these fiat schemes, bigger than Bitcoin by a huge factor – will also collapse, resulting in a net reduction in energy use by 90% globally. I predict that eventually, Bitcoin’s carbon footprint will be zero and fiat money will disappear.
Wyoming is quickly becoming a ‘blockchain-friendly’ US state that has been in the headlines lately for its pro-cryptocurrency business legislation. Where do you stand on regulating Bitcoin?
Wyoming sees an opportunity to steal some thunder from Delaware and Nevada and become the go-to state for Bitcoin incorporation. This is fantastic news for Bitcoin and Bitcoin businesses. Caitlin Long and Trace Mayer are doing an amazing job.
Bitcoinist spoke with Shelly Hod Moyal, Founding Partner and Co-CEO of iAngels, on why the ICO market popped and where the cryptocurrency industry is headed next.
A Hunter College and Kellogg MBA graduate, Shelly is a recognized expert in the areas of Fintech and Blockchain, and is a sought-after expert at international conferences about Israeli tech investing. She serves as a board member of multiple iAngels portfolio companies.
Bitcoinist: Why did the ICO market experience such hype in 2017?
Shelly Moyal: This is a loaded question and there are a few things to unpack. First, most emerging technologies experience hype cycles in which excitement gets ahead of the technology but there are a few things that make the ICO boom and bust unique.
The two most important differentiators were, 1) the participation of retail investors, and 2) liquidity of the assets (i.e. the ability trade these assets on exchanges). Most hype cycles go unnoticed as they are experienced primarily by venture capitalists and due to illiquidity, implode gradually over several years vs. several months as VCs more easily hide behind book values when market pricing information I unavailable.
Before I go into the hype which was driven by a lot of BS and speculation I think it’s important to give the idealistic background that drives the interest in the technology.
There is a growing disenchantment of consumers with traditional institutions which are centrally controlled and therefore vulnerable to mismanagement, exploitation, failure and moral hazard.
Bitcoin has shown the world that it is possible for a group of strangers to reach consensus without anyone controlling the system. This unique feature “programmable trust” has sparked the interest of several academics and entrepreneurs who imagined the possibility of creating numerous applications based on this feature.
The most popular project set out to build an infrastructure for such applications is Ethereum. Similar to Bitcoin, the infrastructure is an open source protocol and it is possible to buy into the project by buying its access token Ether. Bitcoin and Ethereum are both early examples where technology meets capital in the sense that you can buy a token both as a user and as an investor, virtually enabling anyone to invest without restrictions.
The way protocols (like Ethereum and Bitcoin) incentivize adoption is through their access token which has speculative value. As the network grows, the token appreciates in value.
During 2017, the generated wealth of the early Bitcoin and Ethereum investors was readily allocated into additional startups (mostly ICOs) set out to build the ecosystem in pursuit of further capital gains. In turn, hundreds of thousands of people worldwide witnessed how early investors in Bitcoin and Ethereum realized incredible 1,000x+ profits and wanted a piece of it as well.
Entrepreneurs started creating protocols and adopted the ICO crowdfunding vehicle to raise millions of dollars of nondilutive capital for their “token” startups. With the lack of regulatory guidance and oversight around these tokens as well as the lack of institutional investors balancing price levels around fundamentals, prices were getting way ahead of themselves resulting in a large boom and subsequent bust.
Why did it subsequently crash in 2018? Regulatory clampdown? Lower Bitcoin price? Or a combination of factors?
The “crash” was the result of 1) the disillusionment of investors, and 2) the regulatory clampdown.
Most of the investment activity was driven by speculation and price movements were influenced by illiquidity and at times, market manipulation. As these projects were all early-stage startups that have not yet created value (a product and network) it was impossible to justify multi-billion dollar valuations.
The fact that many projects also turned out to be fraudulent didn’t help, and the high demand for these assets gradually evaporated over the course of 2018.
Furthermore, there is no coherent business model for these token investments. In other words, it was (and still is) unclear how value will be captured by the early investors of these networks. Most of the projects today do not have a token model which effectively aligns incentives between users and investors. There is an inverse relationship between velocity and network value.
Meaning that the more hands the currency changes, the lower the valuation of the network because if all demand is met by supply there is less scarcity. So a successful product could still result in little value captured by token holders. Many projects today are experimenting with different token models like mint and burn, governance, work tokens, TCRs etc expected to drive appreciation in the token but these are still unproven.
Furthermore, as regulators, specifically the SEC, made it clear that most token sales are considered security offerings (according to the Howey test and Hinman’s guidance) and started investigating projects that conducted an ICO, more and more entrepreneurs decided not to pursue the ICO path as they realized their tokens would be considered uncompliant securities.
What kind of lessons were learned during the past year?
There are no shortcuts to building a startup even if it’s decentralized. It takes time and for that reason, venture capital cannot be entirely replaced. The idea of startups trading in a liquid market is very nice theoretically but there is no reason for any startup that doesn’t have anything aside from a team and an idea to trade at something much more than zero.
Even today when startups raise money at a certain valuation, it doesn’t mean that the next day someone would be willing to buy the startup at that price. This pricing is just a mechanism for building partnerships between entrepreneurs and investors, not an indication of real fundamental value.
This brings me to another lesson regarding the importance of governance. The lack of self-governance of these startups requires regulation and corporate governance to protect investors and consumers until these networks can truly and fairly govern themselves.
During the period between 2017 and 2018, the ability of entrepreneurs to raise money with no strings attached led to massive abuse, which damaged the industry in many ways.
Ironically, this created a bad perception of the movement largely set out to build a better world with financial inclusion and more aligned businesses built on the values of fairness, transparency, and decentralization.
Why do you believe that the STO can replace the ICO?
We don’t believe STOs will replace all ICOs. STO is a broader category. Indeed, decentralized/utility token projects can take advantage of this route too but broadly speaking, STOs are simply an evolution of capital markets allowing us to tokenize any kind of asset. STOs will play an important role in the future economy as they provide infrastructure for trade and reduce inefficiencies in the current financial markets through disintermediation.
STOs are exclusively based on their regulatory compliance and vetting. How can this crowdfunding model attract the same amount of people that the relatively permissionless ICO model did?
It can not and should not. STOs, by definition, are subject to national securities laws and are thus treated like issuances of traditional securities such as equities and bonds. As a result, the investor universe is restricted and those that choose to market to the general public will be required to comply with heavy and expensive regulation similar to those required by companies wishing to raise an IPO.
STOs will thus more likely follow the trends and cycles of the financial instruments underlying tokens rather than those experienced in the recent ICO bubble.
How does your company iAngels help these projects to manage their capital?
We help them just like we help our other startups across various areas. Investing in startups is a long term partnership and we strive to give our entrepreneurs any support they need whether it’s in business development, fundraising, marketing, finance and/or strategy.
What projects have you invested in recently?
One interesting project is Spacemesh, which tries to create more fairness through a consensus mechanism: Proof-of-spacetime (PoST). Within PoST, storage space is utilized as proof for the verifier (as opposed to computational power in Proof-of-Work).
While nothing stops someone from buying huge amounts of storage space to increase their influence on the consensus, these actors face diseconomies of scale and such behavior is thus not economical. As a result, unused storage space on home computers can contribute to the consensus and if the technology works, the degree of decentralization can be high with low energy costs.
Like you mentioned, most of these projects experiment with new token models, building apps on unproven blockchains. Wouldn’t it makes sense to harness the biggest network effect, i.e. Bitcoin rather than try to build their base layer digital value networks from scratch?
Yes, definitely. Bitcoin and Ethereum have indeed managed to build strong networks over the years with large developer communities, and there is a lot of room to innovate on the layers above these blockchains. And indeed, over the last year, we have already seen several projects build promising applications on these blockchains, especially Ethereum, for example, Maker Dao and its stablecoin Dai.
However, as there are different types of applications, we believe there is no one size fits all blockchain and so there is room for other innovative and novel blockchains (e.g. faster, more secure, more decentralized) that can also emerge as leaders for certain applications.
What is the biggest barrier to cryptocurrency adoption right now?
We believe that the main barriers are technology and regulation. In terms of technology, the stack is not developed enough to build scalable and user-friendly decentralized applications (dApps). And currently, only tech-savvy people interact with them.
Interaction with a dApp, for example, requires you to download the Metamask browser extension, to create a wallet and to fund it with Ether bought through an exchange or broker. This is a lengthy process before you can even interact with a dApp. In order to achieve adoption, the blockchain must operate in a way that is just as seamless as the applications we use today and this will take some time.
We are still at a point in which entrepreneurs need to create breakthroughs at the first infrastructure levels of the technology.
It will take time until crypto will feel like Visa or Mastercard, which are much higher up in the technology stack. Think of the internet before broadband and mobile, much less useful.
In terms of regulation, it is important for entrepreneurs and users to have clarity about the regulatory treatment of these assets, which they don’t have today. As a result, participants in the technology are exposed to potential legal and regulatory proceedings. This veil of uncertainty deters most risk-averse people and institutions from adopting the technology.
What are the opportunities in the industry?
Today the market has changed and what was possible in 2017 isn’t possible today, so what we are left with is actually what might be the biggest opportunity for the industry today.
Talented entrepreneurs and groups are sitting on piles of cash with a lot of time to work and focus on shipping rather than the next VC round. This is a significant advantage given that in VC, entrepreneurs typically raise money for 18 months and if they don’t hit their milestones they’re often out of business.
By removing this “timing risk,” theoretically, a team of talented people has a higher chance of succeeding. If even a few blockchain projects emerge as value adding from this wave, it will be a great win for the industry.
What do you think about Shelly’s view on digital token regulations? Share your thoughts below!
Bitcoinist spoke with Bitcoin Cash advocate and owner of Bitcoin.com, Roger Ver, about the BCH ‘hash war,’ his controversial website branding of Bitcoin (BTC) as ‘Bitcoin Core,’ and why he believes Bitcoin developers are “economically illiterate.”
Bitcoinist: Bitcoin Cash just went thru a ‘hash war’ with Craig Wright/Ayre splitting off to a new chain called Bitcoin Cash SV. Can you share your reflections on the recent hard fork?
Roger Ver: Craig and I don’t have any disagreement. It seems strange that the media is trying to frame it that way.
What developments does Bitcoin Cash have in the pipeline now? What are you most excited about?
I’m most excited about oracle.bitcoin.com that will be launching in full soon. It will result in censorship resistant exchanges, sports betting and much more. I’m also very excited about our Coin Shuffle privacy tool coming to the Bitcoin.com wallet very soon.
Is Bitcoin Cash open to a Lightning Network type of scaling solution, sidechains etc. in the future?
I’ve never been opposed to any of those things. In fact, I’ve provided more funding for both Lightning and Side Chains than just about anyone else. I’m only opposed to the insane BTC block space production quota still being advocated for by a bunch of economically ignorant software engineers who need to pick up an economics book.
Given your commerce adoption focus, how interested are merchants in accepting BCH right now? Why? How many currently accept BCH worldwide?
Obviously, they are very interested as shown by the fact that Bitpay has provided full support for BCH on their platform. More than 100,000 websites are currently accepting BCH, and likely more physical shops are accepting BCH than BTC now.
Many Bitcoin proponents argue that Satoshi’s anonymity and disappearance give it an advantage over other coins that have known founders or de facto community leaders. Do you agree? In this sense, is Bitcoin Cash at a disadvantage since many would consider Roger Ver a leader of sorts given your popularity?
I reject the premise. I didn’t start BCH, and I’m not the leader. I’m just one of many users although I may be louder than most.
Bitcoin Core believes that Bitcoin’s goal is to become digital gold.
Bitcoin Cash believes that Bitcoin’s goal is to become a global currency.
You recently stated that “Bitcoin Core believes that Bitcoin’s goal is to become digital gold. Bitcoin Cash believes that Bitcoin’s goal is to become a global currency.“ But Satoshi wrote that Bitcoin is “more typical of a precious metal.” Why do you prioritize adoption in commerce over SoV? Doesn’t this also run counter to the evolution of money stages as a collectible->store of value->currency->unit of account?
I reject the evolution of money cycle that you have laid out. Money is simply the most commonly accepted barter good. The dollar is the world’s most popular store of value because you can spend it anywhere. If Bitcoin had been allowed to continue to be spendable anywhere, it could have become the world’s most popular store of value.
Instead, the economically ignorant BTC camp have intentionally undermined BTC’s usefulness in commerce and unwittingly undermined its usefulness as a store of value.
I laid it out in detail very clearly in this video that has aged very well.
Your website Bitcoin dot com states: “Buy Bitcoin Cash (BCH) and Bitcoin Core (BTC) with a credit card.” Critics say you are intentionally mislabeling BTC as Bitcoin Core, the name of the Bitcoin software client, to get new users to buy BCH. There have also been reports of people wanting to buy BTC but mistakenly buying BCH instead. How do you respond?
BCH has more Bitcoin-ness about it than BTC, so it doesn’t make sense to call BTC Bitcoin. The website is labeled very clearly, and we have never had a single report from an actual customer making a mistake.
BTC fees have been at the lowest in years this year. Moreover, on October 16, a Bitcoin user moved 29,999 BTC worth $194 million with a $0.1 fee. Why do you state, based on your recent tweets, that Bitcoin (BTC) has “full blocks” and “high fees”?
By intentional design of the “Core Developers”, they want Bitcoin to have high fees and full blocks. If the fees are currently low, then they are failing at what they have set out to accomplish. Either way, they are incompetent.
BCH price is currently at record-lows in USD and BTC terms and down over 96% from all-time highs. What’s the reason? Hash war? Lack of adoption? Overall bearish crypto market? A combination of factors?
Obviously, it is a combination of factors. The market is made up of millions of participants with their own needs, desires, and goals.
Do you hold more BCH than BTC?
Of course. BTC’s future is dim with the misguided economic code being promoted.
What’s your BCH price prediction for 2019?
I don’t know, and neither does anyone else.
What are your thoughts on Roger Ver’s comments? Share them below!
Bitcoinist recently caught up with Roel Wolfert, co-founder of WHIRL, a socially driven crowdfunding platform built on the blockchain.
Roel Wolfert is an expert in digital payments and serves as the COO at Transtrack International, which provides software to banks, governments, and organizations to manage their cash supply chain. Wolfert is also an advisor to the Bancor Foundation, which manages the largest decentralized liquidity network in the world, BeamWallet, the UAE’s largest mobile wallet, and Genexi, a biochain blockchain startup. Furthermore, he is Senior Vice President Consulting & Analytics services at Visa Europe.
Wolfert is actively involved in tech mentoring and diversity initiatives — so we decided to pick his brain on WHIRL and the future of the blockchain and cryptocurrency markets.
Bitcoinist: WHIRL is a socially driven, pay-it-forward crowdfunding platform that’s built on the blockchain. What differentiates WHIRL from other crowdfunding platforms?
Several factors. Firstly, you only get to launch a campaign if you have already contributed to others. The number you have supported and the funds you have pledged increase your Karma, which makes you eligible to start a campaign of your own. So you know that anyone who asks for funding has already ‘paid their dues’ upfront.
Secondly, there’s only a limited number of campaigns that are active at any given time. That means there’s limited competition for supporters’ funds, rather than the normal situation where a large number of campaigns compete for the same pool of money – frequently meaning that none are adequately backed.
Add to this the fact we’re a crypto-based platform that operates across the world, the dramatically lower fees our users enjoy compared to those of conventional platforms like Kickstarter (fees from the platform itself, payment processor and withdrawals, taxes etc can easily total 20% of the money raised), and the large number of cryptocurrencies we accept, and that makes WHIRL absolutely unique and a very powerful proposition.
Bitcoinist: WHIRL brings the entire community’s attention on only a few active campaigns at once. Does this mean that the WHIRL platform isn’t decentralized? Who determines which campaigns are focused on?
Campaigns go into a transparent queue, based on the order in which they are submitted. Only community members who have enough Karma – i.e., who have supported enough campaigns in the past – can launch their own project. So the process is very straightforward, programmatic even. There isn’t a way to game it, since you have to prove your ‘worth’ by backing other campaigns before you start your own. Ultimately this makes WHIRL very different, both in terms of the dynamics of the platform but, more importantly, the kind of community and ethos we are seeking to cultivate.
Bitcoinist: By using blockchain technology, we may assume that all crowdfunding on the platform is transparent and accounted for? Who moderates everything?
We do have a moderation process that is intended to filter out projects that would be illegal in many jurisdictions, or otherwise problematic in some way – for example, we don’t allow members to launch drug or adult-themed campaigns, or those with a political or religious goal. But other than that, eligible projects go straight into the transparent queue, so everyone knows where they stand and which campaigns are coming up next for funding.
Bitcoinist: Which cryptocurrencies does WHIRL support for crowdfunding campaigns? Do you have plans to add more in the future? If so, which ones?
We currently support 12 cryptocurrencies: ADA, BCH, BTC, DASH, EOS, ETH, KICK, LTC, USDT, XRP, XML, and WRL (our own WHIRL token). This alone sets us apart from other crypto crowdfunding platforms, and integrating this many currencies is a testament to our developers’ talent and experience. We’re looking to add more soon, and we’ll also be including fiat deposits as soon as possible.
Bitcoinist: Tell us how the WRL token fits into the platform. What is the benefit for WRL investors or holders? What’s the difference between WRL and Karma points?
Karma is an internal scoring mechanism. It’s not a currency: you can’t transfer or exchange it. It’s tied inextricably to your user account, and you earn more of it when you back a campaign based on the dollar value of your contribution and other factors.
WRL is a crypto token, initially hosted on Ethereum but with the intention that we’ll move to EOS in due course. As our internal token, contributions made with WRL will be worth more in terms of Karma than other currencies – you’ll get a ‘WRL premium’ on your Karma score. As a result, we expect greater liquidity and velocity for WRL, and our most active platform users will probably use WRL exclusively or predominantly.
For investors, WRL will be in demand as that desirable currency. Additionally, we will be taking a small fee in WRL for each campaign, and some or all of those tokens will be burned – decreasing supply and helping to increase value over the long term.
Bitcoinist: WRL was built using the Ethereum ERC-20 standard but will migrate to the EOS blockchain later. Why EOS? Are you concerned at all with recent claims that EOS is too centralized?
Ethereum is the right choice for now since it’s the most mature smart contracts platform: it has the functionality we need and has been battle tested for years and with millions of developer-hours.
However, Ethereum has some drawbacks, including its throughput limit and transaction fees, and so we are looking to move to another blockchain in the future. At the moment, EOS looks like the best option for various reasons – speed, capacity, functionality, cost and so on. Of course we monitor relevant developments in the crypto space and will make a final decision based on the information available at the time. Many platforms have teething troubles or a bootstrap phase where they are not as decentralised as is ultimately desirable – including even Bitcoin, in its early days – so we look forward to seeing positive developments in the coming months.
Bitcoinist: What is, ultimately, the goal of WHIRL?
This is what it all comes down to, and is the key difference between WHIRL and other crowdfunding platforms. Other platforms are solely about money: getting funded is the simple goal. And that leads to unintended consequences, because everyone is competing for funding and unfortunately, some people have figured out how to compete dishonestly. Capitalism, the free market – they’re great, but they are by nature amoral. When you make getting funded the highest goal, you necessarily push into second place every other factor, including the overall wellbeing of the community. We wanted to structure things in such a way that the free market works in favour of everyone.
WHIRL ensures that projects get funded – in fact, we’ve designed our platform so that campaigns have a 100% probability of getting the money they need. But instead of it being a dog-eat-dog world where anything goes to get the funding in the door, we flip the model on its head. You only get to ask for money if you’ve previously backed other campaigns. In our case, money is being used as a kind of social ‘glue’ that strengthens the community. And that’s essentially what we’re trying to build: a real community of like-minded people who will genuinely help each other, with financial incentives to help make it a reality. A genuine community, then, rather than the hollow way the term ‘community’ is generally used in the online world.
Bitcoinist: Where do you see the cryptocurrency marketplace in 10 years?
Cryptocurrency will just be a normal part of life, integrated into everything we do just as regular fiat money is today. The user experience will be much better, and most people won’t know or care what’s going on behind the scenes – much like they don’t care how their iPhone works or how TCP/IP powers the web. It will just be another form of cash. Most likely we’ll have lots of different currencies, and they will be easily exchangeable against each other. They’ll be used for different things and we’ll no doubt have many use cases across online and offline services. Overall market cap will probably be one or two orders of magnitude larger than it is today.
Bitcoinist: Where do you see blockchain technology in 10 years?
Blockchain will evolve rapidly, just like other cutting-edge technologies have done. When you think of where the internet and email were in 1995 – poor user experience, slow, awful interfaces – and then you look at the situation ten years later, you realise how fast things are going to change. By the mid-2000s we had fully-fledged e-commerce – and just a few years after that, almost all of us carry powerful computers, capable of accessing any information on the web and connecting with thousands or even millions of people via social media, in our pockets.
The foundations have been laid but blockchain will change hugely. We’ll see new systems that will support speeds and throughput that are out of reach today. We’ll see new decentralised protocols that build on the same principles but that can’t be considered blockchain. At the same time, it seems likely that some of the first blockchain platforms – including Bitcoin and others – will still be around. It’s an exciting time to be alive, and it’s great to be playing a part in the revolution!
Bitcoinist: What is your favorite part about working for WHIRL?
The great thing of WHIRL is that we give people an opportunity to do good in a transparent blockchain-driven environment. We’re using new technology to implement a new idea. None of this has ever been done before and it wouldn’t even have been possible ten years ago, or even five. And that’s pretty cool 🙂