Episode 47 of Let's Talk Bitcoin Identity & Bitcoin (with Rob Banagale !

!a"ticipants# $da% B& Le'ine ($&L& ( )ost Rob Banagale *o+nde" and ,E- of www&gli&ph $da% B& Le'ine# )i. and welco%e to episode 47 of Let/s Talk Bitcoin fo" -ctobe" 0th 1234& 5isit +s at letstalkbitcoin&co% fo" o+" daily g+est blog. all o+" past episodes and of co+"se. o+" tipping add"ess& 6e a"e at $tlanta fo" the c"yptoc+""ency confe"ence& *o" those of yo+ +nable to attend. 'ideo confe"ence passes a"e a'ailable now f"o% bitcoin'ideopass&co%. and of co+"se. st"ea%ing passes and 757 sets a"e cheape" when yo+ b+y with Bitcoin& 8y na%e is $da% B Le'ine and today. we a"e spending the whole episode with Rob Banagale& In this wide("anging inte"'iew I "ecently sat down with the fo+nde" and ,E- of www&gli&ph at the 9an :ose ,on'ention ,ente" to disc+ss Bitcoin. sec+"e %essaging. identity. g"owth st"ategies. life as a f+nded sta"t(+p. the open so+"ce ;+estion. the passwo"d pa"ado<. if bio%et"ics can fi< it and a b+nch %o"e& If yo+'d like to talk to %e on =li&ph. I'% ,ont"olle"(T"ee(!encil()ea"t& Rob Banagale # It is g"eat to be on Let/s Talk Bitcoin again& I a% so happy to be with yo+ again& It is "ad& $&L&# Let's >+st go with that& Rob Banagle. fo+nde" and ,E- of =li&ph. which is a sec+"e %essaging platfo"%& The last ti%e we spoke. we we"e also not too fa" f"o% whe"e we a"e now. in the city of 9an :ose& ?ot whe"e eithe" of +s +s+ally "eside& It see%s to be the place whe"e we do these inte"'iews& R&B&# @eah. we we"e >+st blocks f"o% he"e& I g+ess it was not long ago& $&L&# It was abo+t 4 %onths I think& R&B&# That is a long ti%e in the Bitcoin wo"ld& $&L&# It has been a long ti%e fo" yo+ too. ce"tainly& The last ti%e we talked to yo+. yo+ had >+st been accepted into Boost 5,'s Bitcoin p"og"a%. basically. with yo+" %essaging p"og"a%& $t that ti%e yo+ we"e fai"ly new. yo+ had >+st integ"ated into yo+" %essaging platfo"%& 9o. fo" those who did not catch that inte"'iew a few %onths back. why don't yo+ gi'e a b"ief o'e"'iew of what =li&ph is& R&B&# 9+"e. yeah& It is aweso%e to be back on the show. let %e begin the"e& 5e"y happy to be in'ited back. it is aweso%e. so thank yo+ 'e"y %+ch& The last ti%e I was on was episode 33. in case anyone wants to go back and check the a"chi'e beca+se I know that is online& Let %e >+st talk abo+t =li&ph b"iefly& =li&ph is a sec+"e %essaging app fo" i!hone and $nd"oid and yo+ can +se the web& (B+t with integ"ated Bitcoin pay%ents in it. which %akes sending bitcoin "eally easy& That is kinda what =li&ph is in a n+tshell& $&L&# @o+ >+st co%pleted this. it was a two(%onth p"og"a%. "ightA R&B&# Th"ee&

$&L&# Th"ee %onth p"og"a% with Boost 5,. and the"e was so%e seed f+nding in'ol'ed. and yo+ ha'e s+ccessf+lly le'e"ed +p that f+nding and now yo+ a"e into the ne<t "o+nd& $s we we"e talking. b+t yo+ said that yo+ co+ld keep painting& R&B&# @eah $&L&# 6hen we talk to people a lot. we find that people a"e inte"ested in sta"t(+ps "athe" than a pa"tic+la" sta"t(+p they want to sta"t& $ lot of ti%es people a"e getting into sta"t(+ps beca+se that see%s like it is getting into tact. 32 yea"s ago. "ight A R&B&# Bh(h+h& $&L&# (Beca+se yo+ %o'ed down f"o% !o"tland. -"egon & @o+ we"e in inc+bato" space. wo"king alongside othe" p"o>ects that we"e in the sa%e space& )ow did that wo"k. what type of en'i"on%ent is this like A R&B&# It is inc"edible& Boost 5, is diffe"ent f"o% a lot of diffe"ent sta"t(+p accele"ato"s& They ha'e set +p a hotel that yo+ li'e on floo". yo+ got a "oo% in a floo" & The li'ing sit+ation is taken ca"e of. which is ( li'ing in the 'alley is a challenging thing. especially fo" ent"ep"ene+"s & That is a big detail. which is taken ca"e of "ight away& @o+ ha'e this s%all "oo%. with these e<ec+ti'e(style b+nk beds& It has these "eally nice b+nk beds. b+t %y co(fo+nde" and I we"e lite"ally sleeping on each othe" fo" the past th"ee %onths in a s%all hotel "oo%. so that is the sta"t(+p life. if anybody was wonde"ing how gla%o"o+s it is& (9o. we wo+ld go down. descend C sto"ies. go ac"oss the st"eet and the"e was an inc+bato" space that was +nde" const"+ction fo" a po"tion of the ti%e we we"e the"e. b+t now it is >+st bea+tif+l. it is a wide open layo+t with desks all o'e" the place and othe" sta"t(+ps in o+" class. cl+ste"ed "ight nea" +s& @o+ go in. yo+ wo"k +ntil yo+ a"e done wo"king fo" the day. and then DEooopF back to yo+" hotel "oo% and get +p and do that the ne<t day& $&L&# 9o. enti"ely foc+sed on >+st wo"king on the p"o>ect& R&B&# @es. I %ean it is 9an 8ateo& I do not know if the listene"s ha'e been to 9an 8ateo. b+t it is a nice s%all town. b+t it is the so%ewhat fo"gotten point between 9an *"ancisco and !alo $lto. whe"e people go D-h. 9an *"ancisco is that tech sta"t(+p placeF and it is. and !alo $lto is like Dthat's whe"e the %oney is at&F That is whe"e the 9and )ill Road ( if yo+ don't know it is. the big 5, "oad that is in !alo $lto. 8enlo !a"k & (9o. 9an 8ateo is this little place in between that. so it is a inte"esting spot& $&L&# 9o. it so+nds like it was a 'e"y positi'e e<pe"ience. going th"o+gh this p"og"a%& R&B&# Talk abo+t the foc+s yo+ >+st %entioned beca+se it is not in 9an *"ancisco. it is a s%all place. the"e is "eally not %+ch to do& 6e fo+nd this inte"esting thing yo+ can do at 9an 8ateo& 6e a"e cat people. %y co( fo+nde" and I. and we a"e doing so%ething cat("elated with Bitcoin Id+nno if I'% going to anno+nce it to yo+" listene"s at this ti%e&&& %aybe so%e ti%e in the f+t+"e& $nyhow. "iding o+" bikes beca+se we ha'e to get e<e"cise when sitting in f"ont of a co%p+te" all day ( we go to the edge of town. and head +p the bike path& The"e is a fe"al cat colony. which a"e taken ca"e of by local cat o"ganiEations& The"e a"e like 72(C2 do%estic cats li'ing in

the wild. so we'd be st"essed o+t f"o% wo"king these long ho+"s. and they co+ld be go like G7o yo+ want to go see the catsAF 6e do not ha'e o+" cats. beca+se they a"e at o+" pa"ents' ho+ses. both of o+" pa"ents a"e looking afte" o+" "espected cats& 6e'd >+st go and see the cats >+st walk a"o+nd. and occasionally so%eone wo+ld co%e by ( a feede" ( who wo+ld feed the cats& That's how gla%o"o+s and f+n it is to be in 9an 8ateo "ight now& @o+ can look at cats& $&L# 9o wo"k. sleep. and fe"al cats& R&B&# I think fe"al is not fai" to these cats& They see% nice $&L& # They a"e ho%eless cats& R&B&# They a"e ho%eless. I g+ess ( they ha'e a colony& I don't know if a colony co+nts as a cat ho%e& I didn't think I'd be talking abo+t this Hina+dibleH& )opef+lly. the"e a"e so%e cat(lo'e"s listening to this& $&L&# $gain. as I said I think the sta"t(+p space is so%ething a lot of people a"e inte"ested in& These inc+bato"s a"e popping +p %o"e and %o"e. not all inc+bato"s a"e c"eated e;+ally& (B+t I think the e<pe"ience is "ele'ant& )ow did the p"od+ct de'elop and %at+"eA 7id yo+ %ake any changes that yo+ did not think yo+ wo+ld %ake o" did yo+ co%e ac"oss anything that %ade yo+ "e(e'al+ate o" take a diffe"ent di"ectionA R&B&# I wo+ld "ewind. and back +p b"iefly to when we last talked& If yo+ listened episode 33 late" in the podcast. yo+ ask what wo+ld we do ne<t& I said we wo+ld do so%e +se" e<pe"ience changes and so%e othe" wallets& $t that ti%e. we had only done ,oinbase& 6e did e<actly what I said on that podcast& If yo+ go back and listen and yo+ look at o+" blog and the +pdates in the app sto"e. then we fi<ed a few things. then we did wallet afte" wallet& $&L&# 6e a"e talking abo+t the Bitcoin integ"ation has ( it's like an instant %essaging application basically. b+t yo+ ha'e othe" options that gi'e yo+ things like delaying deli'e"y of a %essage to a day late". ho+"s late". o" a ce"tain date& @o+ can set it so that a %essage is going to e<pi"e afte" a ce"tain a%o+nt of ti%e if yo+ do not want it to be on "eco"d fo" a long pe"iod of ti%e& Then the"e is a Dsend bitcoinF option. whe"e yo+ can basically. th"o+gh this instant %essaging inte"face. send bitcoin in whate'e" a%o+nt is a'ailable on yo+" wallet. f"o% %e to yo+ o" whate'e"& R&B&# @o+ do a g"eat >ob e<plaining %y p"od+ct. I sho+ld be doing a bette" >ob doing this& =li&ph has a 'e"y sophisticated te<t %essaging capability& It is a hosted. sec+"e %essaging tool. whe"e when I send a %essage to yo+. it goes into the clo+d. it is enc"ypted in "o+te 'ia 99L. it is enc"ypted in the se"'e". it is held between yo+ and I in a p+blic(p"i'ate key fashion in a sec+"e state and it can be accessed in any ti%e f"o% any de'ice. whethe" that be the i!hone. the $nd"oid. the whate'e" ( it s+ppo"ts the web& It has a lot of cool addons to that& Beca+se the syste% is so sophisticated. yo+ can do the thing he %entioned. the delay. yo+ can act+ally delete %essage fo" "eal. instead of %a"king the% as deleted. by "e%o'ing it f"o% the se"'e" and the othe" pe"sons de'ice when they "ef"esh the 'iew& The Bitcoin pa"t is a kille" aspect of it& @o+ can take a ,oinbase acco+nt. so if yo+ a"e on ,oinbase. yo+ can attach it

we call it Dattaching a walletF ( to yo+" =li&ph acco+nt and f"o% the"e on. anyone connected to yo+ on =li&ph ( so. yo+ and I a"e connected. that's how we coo"dinated %eeting +p this %o"ning& Then. I can say Dattach bitcoinsF and hit send. it essentially handles all the details of sending bitcoin. incl+ding fig+"ing o+t which wallet add"esses sho+ld be +sed all of that is taken ca"e o"& $&L&# I cannot think of anything befo"e =li&ph that did this so"t of aliasing of bitcoin add"ess that did this so"t of alias thing. whe"e yo+ can send to an alias and not ha'e to wo""y abo+t gene"ating add"esses o" anything like that& ?ow. we a"e sta"ting to see %o"e options like that pop +p in othe" se"'ices and it see%s like that is a di"ection we a"e going to %o'e in. >+st beca+se it is annoying to deal with inc"edibly lengthy add"esses. b+t this aliases a"e ;+ite helpf+l. b+t I want to take yo+ to a ;+estion of identity& The last ti%e we spoke. we did not ha'e the "e'elations abo+t ?9$ and that all o+" co%%+nication %ethods ha'e been infilt"ated& $nd a lot of this is p"esc"ibed to the fact that these a"e co%panies that a"e p"ess+"ed by sec"et laws and sec"et applications of laws& Is that so%ething that conce"ns yo+A R&B&# $bsol+tely& This is an a%aEing thing that has happened. b+t not in a good way& This happened since we talked. and these "e'elations a"e dist+"bing at the %ost base le'el& The conce"n. I think. is that basically when yo+ a"e talking abo+t ent"ep"ene+"ship and Bitcoin sta"t(+ps. is sta"ting a co%pany whe"e yo+ want to offe" co%%+nication with p"i'acy. and yo+'"e based in the Bnited 9tates. that yo+ co+ld be co%pelled to c"eate a backdoo" into yo+" syste%& I a% happy to open +p and disc+ss this "ight he"e on Let's Talk Bitcoin& This is a "eal challenge fo" a se"'ice like =li&ph. whe"e we''e been offe"ing a sec+"e and p"i'ate syste% since befo"e the =ene"al !et"ae+s scandal hit ( befo"e people we"e thinking of p"i'ate co%%+nication. he"e in the +nited states. as i%po"tant& @es. this is a challenging sit+ation in that we a"e based in the Bnited 9tates& I was bo"n in the Bnited 9tates&I was bo"n in 7es 8oines, Iowa. which is whe"e :ohn 6ayne is f"o%& )e is f"o% Iowa. b+t not&&& ( not 7es 8oines& )e"e. to c"eate a co%pany in the Bnited 9tates at this ti%e. it does %ean yo+ can be co%pelled& I can go on the "eco"d and say that we ha'e not been contacted by any go'e"n%ent agencies. and I think so%e e<ec+ti'es ha'e been able to say this this and ha'e been lying o" so%ething. b+t I'% not fo" what it's wo"th. which I think is a lot& I g+ess. that's what I'd ha'e to say "ight now one. we wo+ld be s+b>ect to the laws of this co+nt"y at this point& ?ow. we offe" so%ething to p"otect people and thei" co%%+nications f"o% any pa"ty. whethe" it be a hacke". an +na+tho"iEed pe"son f"o% obtaining enc"ypted data. incl+ding this Lockdown p"i'acy feat+"e which is +nde" setting on the web app and the i!hone app& This is a si%ila" feat+"e to what La'abit offe"ed. which is if yo+" data is enc"ypted by yo+" passwo"d. if yo+ t+"n this on. yo+ cannot "eset yo+" passwo"d. b+t now yo+" data is p"otected and no one can see yo+" data& $&L&# $nd this is diffe"ent. beca+se no"%ally when yo+ ha'e so%ething like a passwo"d "eco'e"y. that inhe"ently "e;+i"es that yo+" passwo"d be "eset by so%eone who is not yo+& R&B&# This is conf+sing. especially with the enc"yption st+ff. so let's walk th"o+gh this b"iefly& @o+ ha'e enc"ypted data on a se"'ice. b+t yo+ ha'e the ability to "eset yo+" passwo"d with the se"'ice& )ow can they "eset yo+" passwo"d +nless they can fi"st dec"ypt yo+" dataA That %eans the"e %+st be a highe"(le'el passwo"d& @o+ gotta be

at least so%ewhat s+spicio+s. %aybe so%ewhat conce"ned %aybe s+spicio+s is not the "ight wo"d ( that so%ebody wo+ld ha'e access to this highe"(le'el key& 6e offe" this thing& ?ow. that doesn't necessa"ily %ean f"o% the ne<t ;+estion f"o% sophisticated c"ypto(people who a"e +n;+estionably listening to this now. which is Dwhy is yo+" enc"yption not open so+"ceAF This is a co%%on ;+estion that co%es on the s+ppo"t =li&ph. whe"e we talk to people who +se =li&ph "eg+la"ly. which is Dhow co%e this is not open so+"ceAF o" DI don't feel co%fo"table +sing this when it is not open so+"ce&F I co%pletely e%pathiEe with that state%ent and I'd say that so%e of this. whe"e =li&ph is today. is that yo+ need to t"+st Rob Banagale. ?ick $sch. :a%es Lawton. :oaki% *e"nstad. the tea% %e%be"s of =li&ph. that we ha'e i%ple%ented enc"yption co""ectly. and we a"e not doing anything to "o+te info"%ation in an +nenc"ypted way& The"e is a pe"son(t"+st at this le'el with +s& That is ob'io+sly not eno+gh fo" %any people. so fo" those folks. the fi"st thing to say is DLook. this is not fo" e<t"e%ely high sec+"ity sit+ations& @o+ need to be di"ectly in cont"ol of the enc"yption in those things.F so we "eco%%end open so+"ce tools like !=! o" c"yptocat in its e'ol'ed state. whe"e yo+ can pe"sonally inspect the code that yo+'"e "+nning and ens+"e that is "+nning on a co%p+te" that yo+ cont"ol& $&L&# @o+ know. I act+ally did not know that yo+" enc"yption algo"ith%s %ethods we"e not open so+"ce& R&B&# 6ell. the algo"ith%s ( the %ethods that we +se a"e standa"d enc"yption lib"a"ies& 9o the enc"yption %ethods we a"e +sing a"e standa"d lib"a"ies like $E91I0. fo" all the data& 6e a"e not +sing c+sto% enc"yption. b+t the i%ple%entation is what people a"e c+"io+s abo+t& They want to see specific a"eas of code whe"e the enc"yption is done& $&L&# I see. so yo+ a"e talking abo+t why isn't =li&ph as a p"od+ct f+lly open so+"ce& R&B& # @eah. so le%%e >+st go f+"the" on that& (9o why isn't itA The "eason is I think this wo+ld be. so%ething going back to yo+" last podcast. so in yo+" last podcast yo+ we"e talking abo+t ent"ep"ene+"ship. idealis% 'e"s+s e<ec+tion kind of thing& It is 'e"y ha"d to e<ec+te a sta"t(+p. and I don't think e'e"ybody co%pletely sy%pathiEes with this& I desc"ibed the cat getting +p in the hotel "oo% scena"io& It is not a gla%o"o+s social pool in the back ya"d. "ags(to("iches kind of thing& It is %o"e like a g"ind. to be good at c"eating a co%pany than anything else& Befo"e we we"e at Boost. we we"e li'ing in %y %o%'s base%ent. I don't know if I said that in the p"e'io+s podcast& 6e li'ed fo" a yea" with those two cats& It was "eally to+gh. and at ti%es. we we"en't s+"e if we we"e going to %ake it& I ha'e got a p"etty solid ed+cation at this point. I a% 'e"y fo"t+nate in this way& I ha'e wo"ked with a fai" a%o+nt of tech. I co+ld be o+t ea"ning solid do+gh wo"king in tech ?ick. as well& (B+t we''e chosen not to do that. to JinsteadK wo"k on this co%pany& I a% getting back to why this p"od+ct is not open so+"ce yet& In o"de" to %o'e 'e"y ;+ickly ( in o"de" to e'ol'e a p"od+ct as ;+ickly as we ha'e. and also ha'e the p+blic acco+ntability of ha'ing the syste% being open to the point at which yo+ can please open(so+"ce folk. is challenging. I think& It is ha"d to %o'e fo"wa"d ( to %o'e fo"wa"d as well as ha'ing yo+" code open to inspection is "eally to+gh& ?ow does that %ean that we can't get the"eA ?o. I feel that we sho+ld get to a point whe"e we ha'e decent"aliEed the enc"yption of the content and ha'e done it in a way whe"e people can cont"ol how data is enc"ypted as it's flowing th"o+gh o+" se"'ice& 6e ha'e been thinking 'e"y.

'e"y ha"d abo+t this p"oble%& 6e don't ha'e the sol+tion yet. b+t we acknowledge that this e<ists fo" a lot of people and %ay stop the% f"o% +sing =li&ph +ntil then& (B+t what I want to say is that often people want to co%%+nicate in a sec+"e %anne" to e'e"yone they know. so they will t"y to get thei" f"iends to +se c"ypto(cat o" !=!. b+t if thei" e<pe"ience is anything like %ine. they will find that those people fall off ( it is ha"d to get people to consistently +se these sol+tions. beca+se the +se" e<pe"ience is so challenging& That is whe"e we diffe"entiate. that's whe"e =li&ph's diffe"ent ( we ha'e taken a high(sec+"ity syste% and %ade it e<t"e%ely accessible. s+ch that anyone can pick +p and sta"t +sing anyway& That is the opti%iEation point. to take an a%aEing +se" e<pe"ience and sec+"e it with a p"i'ate syste%. and deli'e" it togethe"& 9o that's the thing we'"e t"ying to do& $&L& # I think that the foc+s on +sability is absol+tely "ight& @o+" e<pe"ience with !=! p"etty %+ch %i""o"s %ine& I a% a tech(sa''y g+y. b+t I'% also a g+y who's inhe"ently laEy as a sec+"ity. yo+ knowA :eff"ey !a+l's 9neak's Law states that +se"s eithe" cannot o" will not sec+"ely %anage thei" keys& Is open so+"ce a di"ection yo+ see =li&ph going in the %edi+%( and long(te"%A I %ean. is that a goal fo" yo+ with this p"od+ctA R&B&# The n+%be" one thing is that ( I do not think that the enti"e =li&ph syste% needs to be open so+"ce& I don't think that that's necessa"ily t"+e& I only think it is only 'iable. as a sta"t(+p. to t"y and open so+"ce it& $&L&# Let's talk abo+t that fo" a second& I think I ag"ee with yo+& I think it is definitely ha"de" to %onetiEe so%ething that is open so+"ce. beca+se yo+ a"e in'iting in co%petition it's like Dhe"e it is. we ha'e done se'e"al ha"d yea"s of wo"k. co%pete with +s&F R&B&# Especially at the i-9 le'el& The i-9 is an e<t"e%ely ha"d platfo"% to do a g"eat >ob at& @o+ ha'e seen it beca+se the"e has not been a lot of co%petition on the app sto"e to send and "ecei'e bitcoin ( to deli'e" o+" con'e"sation 'iew. which is tens of tho+sands of lines of codes. >+st to do show a %essage. sent stat+s o" p"og"ess of a pict+"e %essage& These a"e act+ally "eally ha"d challenges. and we spent a yea" and a half fo" >+st that po"tion of the app wo"k& To gi'e that o+t wo+ld be +hh&& $&L&# Right now. to gi'e that o+t wo+ld be a disse"'ice to yo+" in'esto"s& R&B&# Hina+diableH o+" in'esto"s& In o+" talk last podcast. the"e was this idea of people co%ing in. t"ying to %o'e ;+ickly. to deli'e" so%ething "et+"n. a get(in get(o+t I think that one of yo+" co(hosts %entioned like a 1(4 yea"s. and o+t 'e"s+s a 1I yea" 'ision& I wanted to. "ight now %ake it clea" that we a"e not a 1(4 yea" ent"ep"ene+"ship "ight he"e& 6ith )liph o+" goal is "eally beyond Bitcoin& Bitcoin is "eally e<citing to what we a"e doing. b+t we a"e %o"e foc+sed on the idea of identity. and I think I talked abo+t that in episode 33& $&L&# 6e a"e he"e at the ,195 con'e"gence confe"ence. p"etty %+ch all the talks yeste"day. e<cept the bitcoin panel which I pa"ticipated in. was "eally foc+sed on identity and being able to take s%all ch+nks inc"edibly s%all ch+nks of pe"sonaliEed data ( which is "eco'e"ed by all this %y"iad of se"'ices. and abo+t the senso"s in e'e"ything. and how they a"e going to beco%e inc"edibly pe"'asi'e in the

ne<t 3C %onths& $ll of that data is basically wo"thless if yo+ can't tie it to so%eone who yo+ can then t"y to sell things to. so this ;+estion of identity on the Inte"net is going to get to be inc"edibly i%po"tant& Bitcoin is diffe"ent f"o% these technologies. beca+se it does not "e;+i"e that inhe"ent connection between yo+" identity with yo+" bi"th ce"tificate and how yo+ talk on the Inte"net& =li&ph also has g"an+la" cont"ol o'e" yo+" identity and what yo+ "elease f"o% that& 6hy is that a di"ection yo+ chose to take. in a wo"ld which is inc"easingly abo+t ways to not cha"ge yo+" c+sto%e"s and instead %a"ket thei" dataA R&B&# I think fi"st is. I wo+ld get as fa" away f"o%. as a c+sto%e". to be sold to so%eone as a +se of identity& I wo+ld get away f"o% that& I wo+ld say identity is %o"e abo+t yo+ and %e and yo+" tea%, o" people I do not know on the st"eet& 6hat we ha'e. I think is a "eally cool thing& 6hen yo+'"e walking down the st"eet and yo+ see so%eone on the st"eet co"ne". and yo+'"e like Dwho is that g+yAF ( the"e is so%e st"ange" dange" in the Bnited 9tates. I think& 6e e'en ha'e signs that ha'e this neighbo"hood watch g+y with the black silho+ette. and he's got this sneaky look to the side& The"e's that kind of inhe"ent fea" of st"ange"s is p+t into society of people yo+ don't know& Inc"easingly. we a"e finding that the"e a"e a lot of people on the Inte"net who a"e 'e"y %+ch like +s. who think a lot like +s. ca"e abo+t the sa%e things. like obsc+"e pay%ent technologies. and they +nite and fo"% a co%%+nity as a "es+lt& (B+t in the "eal wo"ld. as yo+ walk a"o+nd on the st"eet. the"e is no way to assess if the people a"e of g"eat 'al+e ( not fo" selling so%ething to. b+t >+st to know. to lea"n f"o% ( %aybe they co+ld lend yo+ a lawn(%owe". like if yo+ needed a lawn( %owe"&&& I belie'e that identity and digital identity will beco%e fle<ible to allow yo+ to inte"act with one anothe" in ways that we >+st don't ha'e& The"e is a b"idge between the offline wo"ld and the online wo"ld& The spa"k that allows con'e"sations to occ+" ( so%ething that sepa"ates that %ight be as si%ple as being able to see that this a pe"son has a "ep+tation of so%e type o" t"+st of so%e type& @o+ %ay not see a lot %o"e othe" than a blip that the"e's so%ebody o'e" he"e that's of significance of so%e type& This laye" ( this digital laye" o'e" the people who a"e nea"by and a"o+nd ( wo+ld allow yo+ to inte"act in inn+%e"able ways& 9o%e of those %ay in'ol'e a pay%ent at the end of it down the line afte" yo+''e gotten to know the%. and %aybe that pay%ent wo+ld be handled 'ia Bitcoin& $&L&# I definitely b+y what yo+'"e saying. and that definitely p"o'es t"+e with %e& It is 'e"y diffic+lt to %eet people in "eal(life. it is easie" to fi"st inte"act at an intellect+al le'el befo"e yo+ inte"act on a pe"sonal le'el. befo"e yo+ inte"act at a physical le'el& 9o. how does =li&ph sol'e thatA R&B&# It doesn't& Right now. it does not& I belie'e. and this's why I say that we a"e not in sho"t te"%. I belie'e that this is a long(te"% p"oble%. b+t that it can be sol'ed inc"e%entally ( we can wo"k towa"d it& 6e ha'e the f"a%ewo"k to do that& I think it is 'e"y i%po"tant to begin by allowing anony%ity as a le'el of p"i'acy. which is what we do. and taking that all the way th"o+gh co%pletely 'e"ified identity. whe"e I don't want to "e'eal and I wo+ld >+st say the"e a"e so%e g"eat e<a%ples of it al"eady wo"king& (9o. look at $i"bnb& $i"bnb. when yo+ look at a ho+se. o" a ho%e. o" an apa"t%ent. the pe"son has thei" phone n+%be" 'e"ified. and thei" add"ess 'e"ified. b+t they don't show yo+ the pe"son's phone n+%be". they >+st show the se"'ice has 'alidated that info"%ation& It is ha"d to tell. b+t I think that i%pacts the +se" ( it i%pacts the pe"son. to see this pe"son has so%e so"t of t"+st. so%e le'el of "easonable "ep+tation of

so%e so"t& ?ot that ha'ing a phone n+%be" is %+ch "ep+tation. b+t we a"e still looking fo" anything in the c+""ent conte<t. that life we li'ed th"o+gh f"o% the L2s to now& If yo+ ha'e a phone n+%be" that's 'e"ified. yo+ %+st ha'e so%e "easonable le'el of t"+st. if yo+ ha'e a J'e"ifiedK ho%e add"ess. yo+ %+st ha'e so%e le'el of t"+st& I don't think that it is a co%plete encaps+lation of how "ep+tation sho+ld be dealt. >+st as ob'io+sly as a c"edit sco"e sho+ld not be a encaps+lation of yo+" t"+st. b+t I do belie'e that the"e will be %o"e ways to asse%ble "ep+tation that can be +sed to %eet and inte"act with people& $s a "es+lt. %o"e people will inte"act. and %o"e cool things will happen. with Bitcoin powe"ing the pay%ent po"tion of it& It's a t"ip. h+hA $&L&# @es. and yo+ take that and co%bine it with the =oogle =lass. $I. a+g%ented "eality&&& R&B&# I think it's key to %ake s+"e that this isn't so%ething yo+ need on all the ti%e. this is so%ething that yo+ can selecti'ely "e'eal& $&L& # -ne of the "easons why we don't. I think. t"+st people who we''e >+st %et on the st"eet. fo" e<a%ple. is beca+se we don't know if they a"e good o" bad ( b+t what that %eans is that by effecti'ely identifying the good people. we''e also identified the bad people. and so it c"eates this. I %ean if it's easy to 'is+ally tell who's good and who's bad. this wo+ld c"eate this so"t(of disenf"anchised Dbad peopleF g"o+p& R&B& # This is so%ething that %y co(fo+nde" ?ick is 'e"y conce"ned abo+t& )e plays the side of the sho+lde" fo" this disc+ssion& )e says. Dwo+ld a syste% that offe"s "ep+tation. disenf"anchise so%e peopleA Is it a pa"ticipato"y syste%AF That is a co%pelling. la"ge ;+estion which I do not ha'e an answe" to. yet& B+t the state of things is that is what yo+ ha'e. the c"edit sco"e& (9o we >+st decided to lease a ho+se& I think that is news to sha"e he"e& 6e a"e going to stay in 9an 8ateo. we a"e "elocating f"o% !o"tland. -"egon. so we'll stay nea" the cats (( o+" "eal cats a"e going to co%e he"e. so we don't need to go to the fe"al cat colony to see the fe"al cats any%o"e& (B+t to get the ho+se. I need to check %y c"edit sco"e again& I hadn't done that in a little while. I was kind of sca"ed abo+t it. and b"eathed a sigh of "elief when I finally saw it beca+se it was p"obably eno+gh to get the "ental. and it was& (B+t thank goodness that I had been doing c"edit st+ff in %y life& If not. I wo+ld not ha'e been able to get a ho%e to "ent& (9o. "ight now the syste% is 'e"y %+ch set in pa"ticipation in a way that's linked to fiat c+""ency. the banking syste%. the +se of c"edit ca"ds& I think we can do %+ch bette" than that. b+t the ;+estion yo+ a"e asking is a significant one ( if we a"e doing so%ething bette". how can we do so%ething incl+si'e and allows people who want to establish "ep+tation do so & The f+nny thing is. I sho+ldn't "eally be talking abo+t this. and be d"illing on what we''e done this s+%%e". whe"e =li&ph is b+t this is %o"e f+n. beca+se yo+" last show was abo+t people who a"e in it fo" sho"t te"%. and people who a"e in it to change the wo"ld& I think that is +sed p"etty libe"ally& The"e is a big oppo"t+nity to co%bine ent"ep"ene+"ship a"o+nd technology and bitcoin to do so%ething big. and this is a big thing& HHH$7HHH

:eff"ey T+cke" # )ello. I a% :eff"ey T+cke". host of the ,"ypto c+""ency confe"ence in $tlanta. =eo"gia on -ctobe" Ith& 6e ha'e got a %a"'elo+sly libe"ta"ian(inf+sed day of disc+ssion abo+t what is the f+t+"e of %oney. and yo+ a"e in'ited& *o" those who can't attend. we ha'e pa"tne"ed with Let's Talk Bitcoin to offe" 'ideo confe"ence passes a'ailable fo" go'e"n%ent c+""ency and. of co+"se. bitcoin& *o" %o"e info"%ation ( bitcoin'ideopass&co% Bitcoinsto"e&co% # If I showed yo+ a website whe"e yo+ co+ld easily p+"chase elect"onics f"o% the la"gest s+pplie" with bitcoins at 2M %a"k+p. wo+ld yo+ think it was too good to be t"+eA =ood news. it is "eal. and it's at bitcoinsto"e&co%& ,hoose f"o% o'e" half a %illion p"od+cts. sa'e %oney o'e" $%aEon and ?ewegg. and con'e"t yo+" bitcoins to "eal wo"ld ite%s& @o+ can e'en b+y with p"i'acy& $ll they need is a shipping add"ess& B+t don't take %y wo"d fo" it. see it at bitcoinsto"e&co% HHH$7HHH $&L&# Let's change gea"s he"e and ci"cle back a"o+nd& R&B& # 6ait. befo"e I change gea"s& The last ti%e I was on. I b"o+ght a little thing fo" yo+ ( a f+n %ete"& $&L&# $ f+n %ete"& R&B&# That's "ight& (9o I ha'e got so%ething diffe"ent this ti%e. beca+se I said to ?ick last night. Dwhat can we b"ingAF I was going to b"ing a wei"d 47 p"inted piece of plastic. b+t "ealiEed it is not bitcoin("elated. so we got so%ething f"o% Bitcoin 1234& (so+nd of bag +nEipping( I ha'e a Bitcoin(e%b"oide"ed hoodie& ?ow it's a %edi+% I think I was going to e%ail ,"ystal and ask he" if it was the "ight fit fo" yo+& $&L&# I'% s+"e it'll be g"eat& Thank yo+& @o+ a"e the only pe"son I inte"'iew who "o+tinely b"ings %e gifts& R&B&# $t least I know I wo+ld co%e back if I do that& Thanks fo" the show. I "eally app"eciate it& It is aweso%e. keep doing it& $&L& # It's flatte"ing that yo+ listen. and yo+ clea"ly do listen& R&B&# I do listen& (9o. it's aweso%e. keep it +p& $&L&# Thank yo+ 'e"y %+ch& R&B&# 9o. yes (( switching gea"s& $&L&# 9o. the last ti%e we we"e on. episode 33. as yo+ "e%inded +s ( one of the othe" a"eas that I think we kinda left whe"e the"e wasn't "eally an answe" was. fi"stly the passwo"d p"oble%. and secondly the =li&phs people +se as a +se"na%e& (9o let's talk abo+t the passwo"ds fi"st& ?ow with the new i!hone co%e o+t. finge"p"int ( with big ai"(;+otes ( technology is being integ"ated into %obile de'ices& (9o. it took 4(I days befo"e the syste% had been b"oken +sing low(tech. off(the(shelf %eans& 7o

yo+ think that these bio%et"ic syste%s ha'e a f+t+"eA 7o yo+ think the"e is a sol+tion he"e to the passwo"d p"oble% that we hadn't yet talked abo+tA R&B # I a% not an e<pe"t at bio%et"ic technology& That ca+ght %e by s+"p"ise. as p"obably JwithK a lot of people it did& I think when it co%es down to a lot of sec+"ity. it is abo+t dete""ents. its abo+t t"ying to do a best atte%pt at Jp"e'entingK people Jf"o%K doing the w"ong thing& End(point sec+"ity. the point at which the +se" is accessing the de'ice and %aking s+"e no one had a telescope lens and was capt+"ing yo+" !I? befo"e. and then got yo+" phone. and got onto yo+" phone. and +sed it to access yo+" info"%ation is a challenging thing to take cont"ol of& The finge"p"int thing. I think is anothe" step at it I %ean. yeah. yo+ co+ld get the high "esol+tion finge"p"int and +se the %eans that they show off in the hack to do it. b+t still it is not an easy thing& I %ean. if I want to get yo+" finge"p"ints. how a% I going to do thatA )ow a% I going to get yo+" finge"p"ints. $da%A $&L& # 6ell. I %ean. the"e a"e ways& $nything yo+ to+ch lea'es yo+" finge"p"ints& R&B&# I co+ld. b+t I wo+ld need to be 'e"y dete"%ined(( $&L&# It's wo"k& It's wo"k& I totally ag"ee with yo+ (( R&B&# If yo+ wanted to get %ine. I wo+ld be i%p"essed if yo+ get the%& E'en off this. I a% going to lea'e so%e fo" yo+ "ight he"e. so if yo+ want to t"y and I don't ha'e the I9. so yo+ a"e going to be %o"e t"o+bled to&&& $&L& # That's okay. I don't need it& (B+t the p"oble% abo+t passwo"ds is that. the easie" they a"e to "e%e%be" and +se as passwo"ds. the wo"se they a"e as passwo"ds& I g+ess that's %y inte"est in bio%et"ics I don't "eally ca"e abo+t the specific technology& Is that the sol+tion. o" is it only abo+t passwo"dsA R&B& # I don't know& I do know that %y sol+tion to passwo"ds is that I +se -ne!asswo"d when I want +se a se"'ice (( $&L& # ($nd by Done passwo"d.F yo+ %ean a se"'ice called -ne!asswo"d. not a single passwo"d&&&(( R&B& # @es. I do not +se one passwo"d. I +se a lot of +ni;+e passwo"d of e<t"e%e length with 'a"ying lette"s and n+%be"s. so good l+ck& @o+ sho+ldn't e'en challenge people to do that. so please. act+ally let's not do that& By D-ne!asswo"d.F I do %ean +sing the p"od+ct -ne!asswo"d. which is a passwo"d %anage%ent tool. and it's ha"d to e'en +se that& I +se the app to get %y passwo"ds occasionally ( it is high sec+"ity and a h+ge pain& I don't think the passwo"d thing has been sol'ed yet. e'en with finge"p"ints. beca+se when it co%es down to it yo+ can only +se it to +nlock a phone. yo+ can +se it to b+y st+ff at the app sto"e& They ha'e hinted at the idea that it being +sed elsewhe"e. b+t they a"e still wo"king on it& $&L& # -h. I didn't "ealiEe that it was not a'ailable as an accessible $!I& R&B& # -h no. it is not accessible to app de'elope"s& If it was. it wo+ld definitely be wo"th conside"ing& I think people wo+ld de%and it& This goes down to the c"+< in

sec+"ity and whe"e we'"e at& 9ec+"ity is only good as long as yo+ can get people to +se it & If yo+ cannot get people to +se ( I think 8a""isa 8ayer got +p on stage fo+" weeks ago. and said that she does not ha'e a !I? on he" phone beca+se it takes too %+ch ti%e& 8a"issa 8aye"# G8ike was %aking f+n of %e beca+se I do not ha'e a passcode on %y phone& 8ike was like Da"e yo+ c"aEyAF and I was like. I cannot do this passwo"d thing 3I ti%es a day& 6hen I saw the finge"p"int thing. I was like Dnow I don't ha'e to&G R&B&# $n e<ec+ti'e of a *o"t+ne co%pany is not +sing a pin on thei" phone which is getting Jin ,a%p 9andyK now. that co+ld change the %a"ket& It's kinda a big deal& I think finge"p"ints. so long as they a"e not easily b"oken. can be bette" if it %eans %o"e people wo+ld +se locking& That gets +s back to whe"e I think the a"g+%ent fo" what the p"od+ct we b+ilt so fa" is& It is that Dyeah. it does not pass the e<t"e%e sec+"e checks of open so+"ce and pee" "e'iew.F b+t it does a heck of a lot %o"e than what g"o+p%e. whatsapp and syste%s that a"e sto"ing yo+" data in plainte<t a"e doing and yo+ can get people to +se =li&ph& $&L& # It has been an inte"esting e<pe"ience fo" %e too. since I added %y =li&ph to %y e%ail signat+"e. I ha'e a"o+nd I2 people who I talk to pe"iodically on =li&ph& 9o%e +se it a lot %o"e than othe"s do& That is "eally a p"oble% that we talked abo+t ea"lie". the onboa"ding. getting people to sign +p and +se it& 7id yo+ do anything abo+t that in this pe"iod A R&B& # 9o fa" the"e ha'e been two things. the"e is onboa"ding and the =iphs the%sel'es& I ha'e a whole "ant abo+t the =li&phs thing& I ha'e %ade so%e changes to the onboa"ding & 6hen I say Donboa"ding.F that's kind of gene"ally a sta"t(+p(y te"%. which %eans how do yo+ get so%eone who has not hea"d of yo+" syste% to act+ally +se it and contin+e to +se it so they a"e "etained& $&L& # Beca+se >+st signing +p fo" it isn't that helpf+l (( R&B& # @eah. it isn't that helpf+l& It is like saying. Dwe ha'e a b+nch of +se"s&F It is %o"e i%po"tant that people lo'e yo+" se"'ice. and yo+ know they lo'e yo+" se"'ice beca+se they +se it& I think an inte"'iew of Ti% ,ook was p+blished yeste"day that incl+ded this& I think it was a Bloo%be"g a"ticle& It is wo"th checking it o+t& (B+t the idea is that when yo+ a"e onboa"ding people to =li&ph. it sho+ld be easy to get sta"ted& !"e'io+sly we had this thing whe"e on i!hone. and"oid and the web. yo+ had to choose yo+" =li&ph fi"st& I don't think I ha'e %entioned it in this episode. b+t a =li&ph is %ade +p of sy%bols instead of lette"s o" n+%be"s& (9o instead of being *i"ebi"dI4. yo+ a"e bi"d(lightning(dice o" so%ething like that& The"e a"e 12 of these sy%bols to choose f"o%& *o" so%e people. this is a totally wacky off(p+tting e<pe"ience to choose sy%bols fo" yo+" +se"na%e. we get this feedback occasionally& $&L&# ($nd they ha'e to be +ni;+e R&B&# ($nd it has to be +ni;+e. so %y =li&ph is %y own and no one else can take it at this point& That is to+gh to say so let's get into this pa"t. let's get into the =li&ph thing. now& 9o%e people lo'e it ( they think it is so cool to pick o+t the"e =li&ph and

tell people what thei" =li&ph is& They can pe"sonaliEe thei" identity. in the sense %o"e of e<p"essing the%sel'es th"o+gh the =li&phs they choose& -the" people ( it's >+st ha"d to say it and if anyone wants to %ake a connection "e;+est f"o% Let's Talk Bitcoin. %y =li&ph is dice(hea"t(lighting. so to w"ite that o+t. I lite"ally w"ite it in te<t. o" I ha'e to get this ping and p+t it in the body of e%ail& If I'% sitting opposite to so%eone like "ight now. I'd be like Dhey. he"e it isF and then yo+ ha'e to peck it into yo+" keyboa"d& It's too ha"d& It is too ha"d to do. so we a"e wo"king 'e"y ha"d to %ake this i%p"o'ed f"o% a 'a"iety of diffe"ent ways& -ne is how when yo+ e<p"ess who yo+ a"e. yo+ ha'e a link. so yo+ don't >+st ha'e a =li&ph in the botto% of yo+" e%ail add"ess. b+t a link that is like one(click (snapping so+nd(. and connect with %e& The connection is not like th"ee ti%es back(and(fo"th. it's >+st like (snapping so+nd( Dboo%.F and it's easie" to get "id of one that's +nwanted. so that's one thing we'"e doing& The othe" thing is in(pe"son ( so the"e's so%e "eally cool st+ff happening "ight now& $ct+ally. I feel it's a little ea"ly to say what it is. b+t I can say that we a"e t"ying to sol'e the in(pe"son p"oble%. e<changing and connecting =li&ph in a way that doesn't "e;+i"e yo+ to look +p $&L&# It's a 'e"y %an+al p"ocess& R&B&# Right ( it is a 'e"y %an+al p"ocess& The 'e"y least I can say( we a"e 'e"y. 'e"y ac+tely awa"e that so%e people do not like the =li&phs. and so%e people do not like "e%e%be"ing the =li&phs to type it. and we a"e t"ying to sol'e the%& $&L&# *"o% %y e<pe"ience. a lot of it. is that I a% not +sed to it& -'e" the last&&& I g+ess I''e been +sing =li&ph fo" fo+" o" fi'e %onths now. and %o"e often than not. when so%eone sends %e a =li&ph in'itation. and I know who the pe"son is o" I get to know who the pe"son is. then o'e" a p"etty sho"t a%o+nt of ti%e. I a% like Doh. that's a cool =li&ph.F beca+se I can connect to how the pe"son sees the%sel'es and it's 'e"y st"ange. beca+se it was not like that when I sta"ted +sing the syste%& I didn't "e%e%be" what %y =li&ph was. b+t now I "e%e%be" what it is. %ost of the ti%e& It is co+nte"(int+iti'e. b+t once yo+ get past the lea"ning c+"'e. it "eally gets a lot easie"& R&B&# 9o%e of it is >+st like it's new& $&L&# It is >+st like a new alphabet& R&B& # @eah. it's like a new alphabet& I like to think of the st"angeness of =li&ph. when yo+ fi"st pick it +p. as si%ila" to what yo+ feel when yo+ e<pe"ience Twitte" fo" the fi"st ti%e& If yo+''e ne'e" t"ied twitte". and yo+'"e t"ying to +nde"stand what it is and why it is 'iable. it takes weeks to +nde"stand how to +se it. why it is 'iable and how yo+ can >oin a con'e"sation. to speak when so%eone "eplies to yo+. how yo+ sho+ld beha'e& 6hen yo+ think abo+t Twitte". it's a p"etty co%plicated tool. b+t when yo+ can get yo+" hands positioned on the %achine to t+"n the dials t+"ned "ight at the "ight ti%e. it is an a%aEing. pheno%enal netwo"k& I think that what we ha'e done al"eady has a few of those dials. which can be %o'ed close" togethe" and changed to %ake it a bette" syste% still& Especially. when yo+ a"e b+ilding a co%pany a p"od+ct. "athe". yo+ see coole" things yo+ can do. like g"o+p %essaging& This is one of the %ost "e;+ested things (( $&L&# @eah. I was >+st going to ask ((

R&B& # @eah. this is the %ost "e;+ested thing that's been asked fo" the longest ti%e& The t"ick with integ"ating g"o+p %essaging is that it. in and of itself. can be done in a way that "espects the p"i'acy. that "espects the sec+"ity that we''e al"eady b+ilt into the syste%. and that the +se" e<pe"ience fo" those things is done co""ectly. and how it affects the application& 9o. yo+ kind of ha'e to take two diffe"ent 'iews on it& @o+ can go the *acebook "o+te. and not the *acebook "o+te with how they t"eat p"i'acy. o" anything like that. b+t abo+t the %otto which is Db"eak st+ffF ( I think& D8o'e fast. b"eak st+ffF ( N I don't think I''e got that "ight& D)ackFA (-" so%ething. b+t if yo+ wo"k at *acebook. it is okay to w"ite so%ething and ha'e it b"eak so%ething %a>o"& If yo+ +se *acebook "eg+la"ly. yo+ wo+ld know they b"eak st+ff fai"ly "eg+la"ly. and that's beca+se they a"e %o'ing as ;+ickly as possible&& -ne way to do g"o+p %essaging is to say Dwe'"e >+st going to hack this thing in and see what happens&F The othe" thing wo+ld be to go %o"e of an $pple(type thing. whe"e yo+ only "elease so%ething afte" inspecting e'e"y detail of it and ha'e it as close to pe"fect. if not pe"fect in the eyes of the c"eato" of the p"od+ct. as yo+ can& 6hen yo+ ha'e eno+gh %oney. fo" e<a%ple. and t"action. being the la"gest tech co%pany in the wo"ld. yo+ can gene"ally affo"d to tell the enti"e %a"ket to wait& 6e will do this when we a"e good and "eady. in a way that leapf"ogs e'e"yone else. and we'"e gonna asto+nd yo+ with it& If yo+'"e %o"e of a sc"appie"(type sta"t(+p. yo+ take %o"e of an app"oach whe"e Dwe'"e >+st gonna hack this on&F The p"oble% with doing this hacking(type thing is yo+ "isk lea'ing "o+gh edges on othe" cool pa"ts& The wallet integ"ation. fo" e<a%ple we''e done so fa" ( the"e a"e a so%e "o+gh edges on so%e of the se"'ices& *o" e<a%ple. if yo+ +se two(facto" 989 on ,oinbase. it does not wo"k with =li&ph. b+t if yo+ +se two(facto" =oogle $+thenticato". o" $+thy. which a"e the othe" options on ,oinbase. they wo"ks >+st fine& (B+t we do not e'en say in the app that the 989 does not wo"k. and that conf+ses people& 6e co+ld go back and t"y to w"ite lang+age. o" change the e<pe"ience so that we can wa"n the +se". that this pa"tic+la" thing does not wo"k& E'e"y ti%e yo+ go back and foc+s on fi<ing so%ething like that. yo+ a"e not wo"king on g"o+p %essaging& @o+ a"e not p+shing the p"od+ct ahead& $s a s%all tea%. I %entioned the fo+" people that wo"k on =li&ph "ight now. they cannot do e'e"ything at once as well as %anaging an open so+"ce syste%. whe"e yo+'"e handling all the (( $&L& # 9o. what's the p"io"ity A Is the p"io"ity "ight now ( fo" the ne<t 4 %onths. what's the p"io"ityA R&B # 6ell. the ne<t th"ee %onths. fi"st thing is getting "elocated. getting o+" cats down he"e. getting happy in 9an 8ateo& $&L& # @o+ >+st got yo+" ne<t "o+nd of f+nding& )ow long is that going to take yo+ th"o+ghA R&B& # 6e a"e in the %iddle of a "o+nd& 6ith %ost of these "o+nds. the way it wo"ks and this is %o"e of how s+bsc"ibed that !a+l ="aha%'s st+ff is ( the "o+nds sta"t with an accele"ato". which is a co+ple of tens of tho+sands of dolla"s. yo+ g"ad+ate to type(1 sta"t(+p. I think he calls it. which is when yo+ "aise h+nd"eds of tho+sands of dolla"s of "ange. which is whe"e we'"e at& If yo+ do well. then yo+ get to g"ad+ate to se"ies $ o" se"ies ,. in the 1(I %illion dolla" "ange& 9o. we a"e c+""ently in type(1& 6hat yo+ +s+ally foc+s on is g"owth. being able to p"o'e the concept that yo+''e

done. to %ake it %o"e clea" that the"e's a "e'en+e oppo"t+nity that the"e's a way to kind of %onetiEe this thing yo+''e b+ilt. and then yo+ g"ad+ate to Dokay. now yo+ can "eally blast this thing o+t with $&F 6e a"e foc+sed on g"owth. %aking it easie" to get onto =li&ph. %aking it easie" to get sta"ted. %aking it easie" to get connected with people. and %aking the connections easie" to "esol'e b+ilding netwo"ks in =li&ph& Right now. yo+ and I a"e connected& It's a one(to(one "elationship& If yo+ did not ha'e fifty people. which a%aEes %e. that yo+ ha'e fifty people on =li&ph that's aweso%e ( if nobody sends yo+ a %essage. yo+ ha'e no "eason to +se =li&ph today o" if nobody sends yo+ a bitcoin. yo+ ha'e no "eason to +se =li&ph today& 6e need to ha'e sit+ations whe"e yo+ ha'e netwo"ks b+ilt g"o+p %essaging is a wonde"f+l e<a%ple of that& I know this is wei"d. I ha'e b"o+ght +p cats a h+nd"ed ti%es in this podcast. b+t I'd like to send cat pict+"es to g"o+ps of %y f"iends& I ha'e a g"o+p of people who like to do that& ,at &gifs. especially they'"e f+nny& (9o if I had a g"o+p of people who did that. I wo+ld be checking the app %o"e often than I do "ight now& $&L& # 6ell. to a ce"tain e<tent. it t+"ns into a %ini social netwo"k& R&B& # In so%e sense it kinda does. and it co+ld be a s+pe"(p"i'ate. sec+"e way to co%%+nicate and sha"e things that a"e not >+st te<t %essaging& (9o. the ne<t co+ple %onths a"e a "oad %ap ahead. and we'"e foc+sed on "eally %aking so%ething that is easie" to b+ild netwo"ks a"o+nd and b+ild g"owth a"o+nd& $&L& # 6e a"e al%ost o+t of ti%e he"e& )ow a"e yo+ act+ally going to %onetiEe this. and is this so%ething yo+''e e'en app"oached yet. beca+se it's a f"ee p"od+ctA I know the"e was a 'al+e(add whe"e yo+ had e%ail add"esses that we"e essentially anony%o+s e%ail add"esses people co+ld +se th"o+gh the se"'ice and yo+ got one of those. o" two of those fo" f"ee. b+t then yo+ co+ld b+y %o"e at a no%inal fee. b+t they we"e p"etty ine<pensi'e& 9o is %onetiEation e'en so%ething yo+'"e looking at. o" is it %ostly >+st foc+sed on the g"owth sideA R&B& # It absol+tely sho+ld be so%ething any b+siness sho+ld be foc+sed on. how is it going to %ake %oney& 8ost co%panies don't get to do what Instag"a% did. which is Dwe'"e ne'e" going to co%e +p with anything. we'"e >+st going to b+ild so%ething %assi'e&F In the 5alley. the"e is so%ething to be said fo" b+ilding shee" g"owth fo" g"owth's sake. b+t I don't think that's a good way to b+ild a b+siness& $&L&# It's especially ha"d when yo+ don't ha'e that identity data and yo+'"e not able to gene"ate those st"ea%s& R&B&# Right& I don't think that yo+ ha'e to necessa"ily %onetiEe pe"sonal data in o"de" to %ake %oney. and that's p"obably the w"ong way to be thinking abo+t things. and it's ce"tainly not that we'"e thinking abo+t doing this& 6e don't belie'e in selling peoples' pe"sonal data. so that's al"eady off(the(shelf what's the "ight lang+age. he"e&&&A $&L&# It's o+t of the ;+estion& R&B&# @eah. it's o+t of the ;+estion& Thank yo+& )e"e'"e so%e ;+ick ideas& -ne is ( the"e a"e a lot of feat+"es that people ask fo". that a"e p"o(le'el things& *o" e<a%ple. people want. essentially. what's al"eady offe"ed on so%e othe" se"'ices. which is DI

want %y %essages to be contin+o+sly deleted afte" they'"e "ead&F ?ot e'e"ybody ca"es to do that& In fact. %ost people don't delete %essages& 9o%e people delete the% "eligio+sly. so the we belie'e that between that 'ideo %essaging. so%e othe" "eally cool little p"o feat+"es and also >+st basically s+ppo"ting =li&ph& It's a f"ee thing "ight now& 6e''e p+t I''e p+t a f+ll two yea"s %o"e than a f+ll two yea"s of %y life in this thing "ight now& 6e''e ne'e" cha"ged. e<cept fo" the s%all optional e%ail thing& It wo+ld be a%aEing to ha'e people say Dgosh. we like what yo+'"e doing. we like what yo+''e done with Bitcoin& I'd like to s+ppo"t yo+ by s+bsc"ibing&F (9o. we'd like to offe" the% so%e additional p"o feat+"es. and also >+st ask people to s+ppo"t what we'"e doing by gi'ing %oney to +s& $&L&# @eah. so a *"ee%i+% %odelA R&B&# @eah. a *"ee%i+% %odel& 9o we belie'e the"e's oppo"t+nity the"e& 6e also belie'e the"e's oppo"t+nity in Bitcoin. specifically. so the"e a"e two things I want to talk abo+t. he"e& -ne's p"etty sophisticated. one's %aybe p"etty ob'io+s& (9o =li&ph's now integ"ated with ,oinbase. BI!9. and Blockchain& @o+ can. on ,oinbase and Blockchain these wallets offe" ways to e<change fiat c+""ency fo" bitcoin. so like the "etail e<change on ,oinbase. fo" e<a%ple it's "eally easy& $,) in. bitcoin o+t one of the easiest in the Bnited 9tates. at least& 9ince we talked. we c"eated this thing called DInstant 6allet ,"eation.F and what this thing did. is it allowed anybody new to =li&ph to c"eate a wallet >+st fo" the few tabs& 6hat we''e done is basically c"eating wallets& 02M of new +se"s to =li&ph a"e c"eating thei" Bitcoin acco+nts. and we belie'e a la"ge n+%be" of those a"e people who a"e new to Bitcoin. so we'"e not only int"od+cing people to Bitcoin. we'"e saying Dthis is how easy Bitcoin can be.F so we'"e teaching the% this new way of +sing Bitcoin& 6hen we c"eate a wallet on ,oinbase. o" a wallet on BI!9. we'"e c"eating oppo"t+nity fo" those wallet p"o'ide"s to get people to b+y bitcoin and when they do that. they take fees& (9o. the"e's an oppo"t+nity he"e whe"e we'"e c"eating c+sto%e"s fo" these se"'ices. and al"eady. fo" e<a%ple. if yo+ "efe" so%eone to ,oinbase. yo+ get paid o+t ( and they con'e"t %oney into Bitcoin. yo+ get paid o+t. a s%all thank(yo+ fo" the "efe""al& The"e's oppo"t+nity fo" =li&ph as it c"eates wallets on big wallet p"o'ide"s that se"'e as e<changes to "ecei'e co%pensation fo" the "efe""al& I''e got a diffe"ent %onetiEation. tho+gh. that's kind of o+t the"e& This is fo" yo+" ad'anced listene"s& 9ince we talked. I %entioned we did sta"t with ,oinbase. then we went to BI!9. and then Blockchain& 6hat this %eans is ( $da%. if yo+'"e on BI!9. which is the big wallet p"o'ide" in E+"ope. and I'% on ,oinbase. and we'"e connected on =li&ph. and I want to send yo+ half a bitcoin. I send it to yo+. and it's >+st taken ca"e of& ?ow. let's say I want to send yo+ half a dolla" wo"th of bitcoin so I don't know what that is today. b+t a 'e"y s%all a%o+nt. so%ething that wo+ld be s+b>ect to a netwo"k fee %ic"o(t"ansaction bitcoin& 6e'"e going c"oss(wallet I sho+ld say. the big wallets a"e now offe"ing f"ee. instant %ic"ot"ansactions within thei" wallets. beca+se they'"e doing it off(chain& ?ow. if I want to send it c"oss(wallet. it's not f"ee. so we'"e going to get dinged on that& ?ow. the cool thing abo+t what we''e b+ilt so fa" is that since =li&ph integ"ates th"o+gh the $!Is of these two diffe"ent se"'ices. yo+ want to send %e half a dolla"'s wo"th of bitcoin. so. say. &222I bitcoin& @o+ send it to %e on =li&ph& 6hat we can do. is instead send that to a =li&ph(cont"olled acco+nt on that se"'ice. so it's still within the f"ee %ic"ot"ansaction le'el. beca+se it's in that wallet. and then on the othe" se"'ice on ,oinbase. a =li&ph acco+nt will then send to the "ecipient that &222I& $gain. within the wallet. so it's f"ee of that netwo"k t"ansaction fee&

$&L&# (9o what's happening. o" what co+ld happen in this scena"io. is that yo+''e got two off(chain se"'ices. so =li&ph %aintains acco+nts on both sides. and essentially does a"bit"age between the two. so they'"e both instant t"ansactions. and fee(f"ee t"ansactions. and then yo+ g+ys will collect a s%all po"tion of what fee R&B&# @eah& Theo"etically. we can eli%inate inte"(wallet netwo"k fees by doing this& That's c"aEy. like no one is being able to do this. beca+se we'"e +ni;+ely positioned as a thi"d(pa"ty to these wallets that we can do so%ething like this& ($nd then. what we'd ha'e to do. ob'io+sly. is set +p the books so we late" wo+ld %o'e Bitcoin. b+t $&L&# (9o yo+ can "eckon it& R&B&# Reckon it. yeah. we $&L&# @eah. b+t it can be done at a la"ge. highe"(le'el R&B&# @eah. that doesn't s+b>ect Jthe%K to netwo"k fees& (9o. on 'ol+%e. we can do so%e "eally cool things c"oss(wallet& I don't "eally think anybody's "eally conside"ing things like this& $&L&# 6e "eally a"e o+t of ti%e. b+t that is a 'e"y inte"esting app"oach to it& I "eally look fo"wa"d to seeing how yo+ de'elop these %odels. beca+se it's ha"d to %onetiEe things that a"e f"ee& R&B&# It is 'e"y ha"d. and I >+st ask the listene"s. keep an eye on what we'"e doing& If yo+ don't feel it's at the place that it needs to be. yet I ag"ee with yo+& 6e got a lot of cool wo"k to do. yet& (B+t it's cool to see all the s+ppo"t f"o% the Bitcoin co%%+nity. and I lo'e to see feedback& I "+n the 9+ppo"t =li&ph. so if yo+'"e t"ying =li&ph fo" the fi"st ti%e today. send %e a %essage. say Dhello.F say that yo+ hea"d abo+t it on Let's Talk Bitcoin& I will "eply to yo+& 9o%eti%es it takes %e a few ho+"s& Thank yo+ g+ys fo" ha'ing %e on again& I hope that I co%e back again& I like Let's Talk Bitcoin. it's "eally cool& $&L&# I'% s+"e that yo+ will. Rob& Thanks again fo" being on the show. and keep +p the good wo"k& R&B&# Thank yo+. I will& $&L&# Thanks fo" listening to episode 47 of Let's Talk Bitcoin& ,ontent fo" today's show is p"o'ided by Rob Banagale. with on(location enginee"ing by ,"ystal Le'ine& 8+sic was p"o'ided by :a"ed R+bins and :aEEtown& If yo+ can't get eno+gh o"iginal tho+ght and disc+ssion. "ead o+" daily blog at letstalkbitcoin&co%& 9ign +p fo" o+" weekly newslette" at theweeklybitcoin&co%& To get in to+ch. send %e %ail at $da%Oletstalkbitcoin&co%. o" 'isit letstalkbitcoin&co%Ptalk to be di"ected to o+" listene" s+b(Reddit& 9ee yo+ ne<t ti%e&