In glittery surroundings, next to the skyscrapers of London, the financial capital of the world, a packed room of blockchain enthusiasts heard from Edan Yago, CEO of Epiphyte, former employee at Zynga.
We are preparing for a world where “95% of your customers are not human,” he says. The current financial system does not scale for machine to machine transactions, Yago argued, as they address it like a “liberal arts problem” leaving us with a “chain of corresponding banks” which are not interoperable. Visa, for example, does not communicate with mastercard, Yago says.
Public blockchains provide the solution to interoperability, Yago argues. Although there have been a number of companies that have achieved great things in international transfers, especially within Europe, they have reached the limit of optimization. Epiphyte, a three years old company which had only banks as its customers for its first two years, now open to non-banking institutions, is taking it further.
In a seemingly partnership with Visa, they connect the financial systems through bitcoin by using payment channels. In giving a demo after the presentation while surrounded by many interested conference participants, Yago showed a transfer of $1 internationally at a fee of two pence, from bank account to bank account. It uses bitcoin underneath, but the customer sees only fiat.
Gavin Smith from First Global Credit which provides market access to digital currency traders explained that hedging counterparty risks was important because the overall bitcoin system is not trustless. FGC spreads risks across numerous exchanges, he said, with none having more than 15%. They rate exchanges on a number of criteria, such as jurisdiction, the transparency of their management team and length in business with only Kraken and Bitstamp making it to Tier1. He did not name the exchanges in tier 2 or 3, but we do business with even tier 3 exchanges, he said.
Marco Streng, CEO of Genesis Mining, marveled at how much bitcoin has grown, stating his first conference was in some small room. He gave an overview of bitcoin mining, with noteworthy statements more related to Ethereum, such as “rumours” that FPGAs for Ethereum have been created as well as Genesis mining running the largest Eth mining farm.
He further stated that Genesis Mining had recently launched the Logos Fund, “the world’s first bitcoin mining fund” regulated by SEC and BaFin, the German equivalent of SEC. It “enables large investment in a safe and regulated fund structure” the presentation says.
Brian Hoffman, from Open Bazaar, stated that they were “sternly opposed” to criminal uses of Open Bazaar and that decentralized governance is very difficult, “most do it badly”, Hoffman says.
An overview of Augur, which is Ethereum based, was given by Jeremy Gardner. He stated that although prediction markets are more accurate than expert opinion, many such markets have been shut down. Augur provides a decentralized solution. Asked whether it is legal, he stated that it is. “We do software development” Gardner stated, we speak to regulators.
One of the more interesting takeaways from the event, however, was happening outside. Christopher Zaniewski, a bitcoin enthusiast, was sitting next to a sign asking to be hired. “I am currently unemployed,” he told me. “I am learning to code, but have a sales background. I want to work in the bitcoin or cryptocurrency space,” he said, before adding that he had near double digits bitcoins – and dash.
It is very much a sign of how times may be changing. Although the conference had little code development or household brand announcements as in Devcon2, with the emphasis seemingly primarily on bitcoin’s monetary nature, the event was packed on a Sunday afternoon. Making it all feel real, as if there is something here, but besides the super cheap international transfer app, there seemed to be little indication on stage of what exactly that something may be in practice.
Off the stage, however, you can see the brightness some carry, intermixed with the financiers, the opportunists, the rebels, and the man outside. A shift, therefore, where the base does not yet have hierarchies, allowing meritocracy to elevate with little judgment, but the conference, overall, leave one asking even more – where exactly is bitcoin going?
Images from Andrew Quenston for CCN.