On this episode of Bitcoin Magazine’s “Bitcoin In Asia,” Niall Ferguson joins host John Riggins for a wide-ranging conversation about Bitcoin and the evolution of finance.
Ferguson is the Milbank Family Senior Fellow at Stanford University’s Hoover Institution, a senior faculty fellow of the Belfer Center for Science and International Affairs at Harvard University and a visiting professor at Tsinghua University, Beijing. He is also the author of 15 books, including “The Ascent of Money” and writes a regular column for Bloomberg Opinion.
In this episode, Ferguson discussed his recent Bloomberg piece “Bitcoin Is Winning the Covid-19 Monetary Revolution” and discussed the history of financial evolution, including how the current iteration of that evolution is playing out between China and the U.S. and how he views Bitcoin in that context. He also discussed the qualities that make Bitcoin a significant advance and the broader importance of decentralization and sovereignty.
This episode of Bitcoin Magazine’s Bitcoin In Asia featured Lixin Liu, the head of hardware at Cobo and the creator of the Cobo Vault, out of Shanghai.
Lixin’s background in hardware and international product development, most recently in robotics with Hover Camera, made him the preferred choice of F2Pool and Cobo Founder Discus Fish when he decided to get into the Bitcoin hardware and security game.
Lixin and I discussed building out Bitcoin hardware from the ground up and why it is valuable to the Bitcoin network to have increasing competition in the hardware product space, the difference between what Chinese miners and Western retail users want in hardware products, trends he is seeing in institutional custody interest in Asia and more.
The guest for this episode of Bitcoin In Asia is Alejandro De La Torre, vice president at Poolin. De La Torre and Poolin have launched taprootactivation.com to improve on the communication and transparency of the Taproot activation process. Bitcoin Magazine’s Aaron van Wirdum covered the initiative here, and in this Interview, De La Torre and host John Riggins explored additional context around it.
De La Torre has been in the Bitcoin data and mining space since 2014 when he founded SendChat, later acquired by wallet and data service Blocktrail, where he led business development until the company was acquired by Bitmain. Inside of Bitmain, De La Torre co-founded BTC.com and led its European office during the SegWit upgrade process. Now, back with former BTC.com colleagues at Poolin, De La Torre leads its global business development initiatives.
Poolin operates out of Beijing and is currently the second-largest pool in terms of Bitcoin hash power. Their services have expanded over the past year to include facilitating additional financial services products for their miner customers, and they have partnered with BlockFi and Three Arrows Capital, among others, for those expanded services.
In addition to discussing taprootactivation.com, De La Torre talked about lessons learned during the SegWit and blocksize debates, Bitcoin upgrade activations and the changing competitive landscape in the Bitcoin mining pool business.
In this episode of Bitcoin Magazine’s Bitcoin In Asia, some of the godfathers of Bitcoin — Nick Szabo, Adam Back and David Chaum — discuss the history of the technology with host John Riggins. This episode was recorded during a live panel from Seoul at Korea Blockchain Week and is laid out as a history of the ideas and events that led to Bitcoin from their first-person accounts. It also features their current thoughts on the latest experiments in Bitcoin and what excites them about its future.
Szabo is a computer scientist, cryptographer, the designer of BitGold and a smart contracts pioneer. Back is an applied cryptographer with a computer science PhD in distributed systems, the inventor of Hashcash and cofounder and CEO of Blockstream. Chaum is best known for his fundamental innovations in cryptography, including privacy technology and secure election systems, as well as digital cash, and is currently leading Elixxir and Praxxis. Both Back and Chaum are cited in the Bitcoin white paper, while Szabo’s influence has been mentioned by Satoshi on Bitcointalk.org.
From the cryptography and cypherpunk movements to David’s DigiCash, Adam’s Hashcash proof-of-work, Nick’s BitGold and more, their contributions were foundational to the development of Bitcoin, and it was fascinating to have them together and playing off of each other in a discussion of that history.
While the volume and scale may not be huge by current industry standards, venture capital inflows into Indian Bitcoin companies have been hard not to notice this year. Long considered an obviously ripe market for Bitcoin adoption, the regulatory and banking establishments in India have, at times, hamstrung growth of a local commercial Bitcoin ecosystem, leading to frustration for companies building and gaining traction for their services as well as for outside capital looking to take advantage of a brimming opportunity.
But the main shackles hindering this growth came off in March, with the dramatic ruling by India’s Supreme Court just a few weeks before COVID-19 shutdown was implemented, overturning prior action from the Reserve Bank of India (RBI) forbidding Indian banks from touching crypto, resulting in a slew of fresh funding rounds and attack plans.
Unocoin is the latest Indian Bitcoin company to capitalize on the momentum, announcing a new funding round with a Series A in process led by Draper Associates and with participation from Deribit backer XBTO Ventures. Upon completion, the round is expected to value Unocoin at $20 million. To learn more about its progress, as well as the changes happening for Bitcoin-focused projects throughout India, Bitcoin Magazine caught up with Unocoin Co-Founder and CEO Sathvik Vishwanath.
Vishwanath discussed the journey of his Indian Bitcoin exchange over the past seven years and explained that the drama of participating in a case before the Supreme Court was “like being in a movie.”
Tracing The Growth Of India’s Bitcoin Businesses
Between 2012 and 2016, an Indian Bitcoin exchange ecosystem developed and attracted outside capital, with a few players emerging as leaders in the market. Zebpay, Unocoin and Coinsecure each raised more than $1 million in funding and serviced a majority of the Indian market.
The RBI’s action to bar Indian banking institutions from dealing with crypto companies in 2018 — making it impossible to offer Indian Rupee (INR) onramps and trading pairs — threw a wrench into the established exchanges’ growth plans as they scrambled to figure out the best way to continue operations. It also left an opening for a new batch of startups to grab market share. Several members of this new wave used their lack of existing infrastructure to their advantage, building out a local customer base with a novel P2P structure that bypassed the banking ban. This batch included projects like BitBnS, CoinDCX and WazirX.
The Supreme Court’s new ruling, overturning its ban, has made the market a focal point again in terms of large market opportunities around the world, with outside capital and companies figuring out how to best take advantage.
This has included global exchanges putting stakes down via investment or acquisition. BitMEX parent 100x Group and Coinbase Ventures participated in CoinDCX’s Series A and strategic rounds, totaling $5.5 million. Binance acquired WazirX in a deal estimated to be worth between $5 million and $10 million. London-based Cashaa raised strategic funding totaling $5 million for India expansion.
Brand-name VCs are also leading these new rounds: Bain for CoinDCX and Draper Associates for Unocoin; Blume Ventures, with Tim Draper as a limited partner, for Unocoin’s $1.5 million round in 2016 with participation from Digital Currency Group (DCG).
In an announcement of the funding round shared with Bitcoin Magazine, DCG’s Larry Sukernik summarized what all competitors have to look forward to even as momentum builds.
“Running a cryptocurrency exchange is a tough business,” Sukernik said. “Running a cryptocurrency exchange in India is an even tougher business. The fact that Unocoin survived and thrived is a testament to the team’s ability and grit.”
Global Bitcoin product companies with teams in India are also now able to target customers in their backyards. One of these is the lending and borrowing platform Vauld (formerly Bank of Hodlers) whose CEO Darshan Bathija recently spoke with Bitcoin Magazine.
With an entity based in Singapore and customer base spanning North America, Europe and Southeast Asia, but a team concentrated in India, Darshan is “personally excited” that “India as an opportunity only really opened up since the banking ban was reversed… and it was a very positive upside for us.”
He added that “as long as there is regulatory clarity we are in an industry that is going to thrive and Bitcoin is going to be a very attractive opportunity for the 1.4 billion people in India.”
“The potential for widespread crypto adoption in India is massive,” as Unocoin Co-founder and President Sunny Ray stated in the recent DCG funding announcement.
India is the second-largest country by population in a world, with a consumer base that has long valued gold and that has rapidly moved to mobilefirst commerce and digital payments, as well as an education sector that has pushed out engineering talent at scale like no other. Combined, this makes it ripe for massive Bitcoin adoption and the rush to own the market is back on.
Always a sector to watch, the Bitcoin mining space is host to several narratives that are worth a closer look today, as fresh capital and competition enter the market. Among these are the geographic distribution of hash power, mining hardware hierarchy and mining pool offerings.
On this episode of Bitcoin Magazine’s “Bitcoin In Asia,” Nishant Sharma, a long-time bitcoin mining industry insider in China who is now a founder and partner of BlocksBridge Consulting — a communications strategy and advisory firm focused on the bitcoin mining sector that serves some of its largest companies — helped break down these narratives with some additional historical context.
Sharma explained how the negative news around flooding in Sichuan has been overblown and mining dominance from China is not changing anytime soon. He also discussed why the decentralization of mining geographically is still a real event, with North America and Russia as growing markets. He also laid out the landscape of mining pool competition: how it has developed and experienced incredible turnover over the years and what new competition and products are shaping its future.
The mining hardware space has experienced less turnover, with Bitmain taking a dominant position early, and Sharma handicapped MicroBT’s rise and the factors at play for hardware moving forward, including the significance of Digital Currency Group entity Foundry’s partnership with MicroBT and the entrance of additional institutional capital.