8btc Exclusive: Nicolas Cary Talks About Everything from Bitcoin’s Technical Upgrade to Exchange Platforms in China
2017 has been a rocky year for Chinese Bitcoin investor. The Big Three exchanges suspended bitcoin withdrawals. The China Securities Regulatory Commission (CSRC) made it clear that illegal exchanges must be shut down. Plus, it was reported that the Big Three will be facing a penalty with unknown amount and new regulations are expected to be released in June.
But Nicolas Cary decides to leave the bad news in the dust and remains optimistic about the future of bitcoin in China.
Recently we see a lots of debate on bitcoin’s technical upgrade, e.g. SW vs BU, what is your view on the difficulties bitcoin is facing on technical upgrade?
If you just casually pay attention to Bitcoin it will appear that there is always some drama in the industry. There was drama in 2011, 2012, 2013, every year. More unties our community than divides it, we want Bitcoin to be adopted by more people, we want it to be more reliable, and we want it to be affordable to transact with. These are not mutually exclusive goals, but they do have some technical trade-offs which then makes any changes political. Ultimately, once a proposal comes forward that most people can agree to then I expect it to get adopted.
Some people think that bitcoin in China’s region means fake money = they are not real currency, what do you think?
The history of money is quite old, and people have tried lots of different types, including, pears, gold, and paper. Bitcoin is digital currency for the age of the internet. It has value because it is both scarce and useful. Some people use bitcoin because they see it as a good store of value (in fact, bitcoin has been the best performing currency 4 of the past 5 years) — other’s use bitcoin because it’s the fastest way to transact with anyone else in the world. This makes it really convenient to use for payments. Ultimately, all money is based on people’s perceptions and the properties of the money. Bitcoin has all the same properties as other forms of money and more, including the fact that it’s purely digital, there’s a limited supply, just like gold, and anyone in the world can use it.
All the companies are doing ICO now, are you planning to do ICO? What do you think of ICO, have you ever been joined any ICO activities?
ICO’s are a really interesting new way for companies to raise funding. On the one hand I see it as a really exciting way to crowdfund, but I also think it can be limiting, since lots of people still don’t know much about digital currencies like Bitcoin. Also, while ICO’s can help reduce barriers for startups to raise capital, they also pose an extra burden on investors to really do their homework before contributing to a new project. Unfortunately, just like with many investment opportunities, there have been many scams.
People are saying that Bitcoin might be replaced by ETH or other cryptocurrency. What do you think? How can we avoid this situation?
Bitcoin has been steadily growing every years since 2009. In fact, four of the past five years, Bitcoin has been the best performing currency in the world. More people rely and use Bitcoin every day to transact with each other than all the other digital currencies combined, so I think it still represents the strongest and most stable of the cryptocurrencies. It’s really difficult for alternative coins to compete with the strength of the service providers and technologists that are dedicated to building applications to make Bitcoin useful. Finally, because Bitcoin has been around longer, it has the most trust from the largest audience of users. I see Ethereum as solving a completely different use case than Bitcoin, so I expect them to co-exist together; it’s still very early for Ethereum though, with many uncertain outcomes including key changes to their development roadmap.
Blockchain has clarified it is not committed to SW on weibo, so what does Blockchain think of Core v.s. Unlimited? Where do you stand?
We’ve decided to remain as neutral as possible but we do think scaling needs to happen. When the mempool gets backed up some of our users complain about slow confirmation times. This is a big problem, because the vast majority of Bitcoin users today don’t even know there is latency on the network, and they do not care about Core VS. Unlimited — they just want to reliably make transactions with their friends and family members. We need Bitcoin to stay competitive or I do think it’s possible an alternative protocol will start to capture more market share if it proves to be more useful; that would be a shame, because the more people that rely on bitcoin, the more valuable it becomes: it is network effect money.
As I know, your developer team launched a lightning network project called ‘Thunder’, how is it going?
Thunder and layer two protocols for increasing capacity on the blockchain continue to hold much promise, but we’re still a ways away from production. If anyone is interested in our progress they should sign up here to stay in touch: https://www.blockchain.com/thunder/index.html
Are your developer team doing new projects recently?
Our development is busy around the clock working to make all of our applications and core services better. We also have some exciting new features coming out we think people will love, but we can’t talk about them yet! Sorry 🙂
The advantages of Blockchain is very obvious, will you build up an exchange platform to trade altcoins?
At Blockchain our mission is to build an open, fair and accessible financial future, one piece of software at a time. In the past twelve months, we’ve more than doubled the number of wallet sign ups to over 13.5 million, so it’s really important that we continue to make sure we build awesome software and support our core user base. We like to partner with exchanges in each of the markets we move into, so that regional users have access to regional payment channels when buying their digital currencies. At this time, we don’t feel the altcoin market is mature enough. Most of those coins don’t fulfill a value proposition that isn’t already stronger than Bitcoins.
You are doing bitcoin wallet only, will you add over altcoins wallet, such as dash or LTC, ETH?
We really rely on our users and community to help inform our product roadmap. Right now, the vast majority of our users just know about Bitcoin. Would you prefer to have a wallet that includes different alt coins and digital assets? How would you pick which ones to include?
What is your view on that many central banks believe blockchain technology are lower level technology(implying not able to use directly in practice) and still with many flaws?
Based on the public statements made by several central banks they are clearly paying close attention to the developments in blockchain technology. The Bank of England has an open call for FinTech companies to apply to their accelerator to prototype different blockchain applications so the interest in the technology is real. How that interest translates into actual monetary policy is unknown, but what we can be sure of is that digital currencies and blockchain technology are here to stay, and can provide some really compelling benefits to central banks like digital efficiency, transparency, and technical resiliency.
Your bitcoin wallet is free now, do you have a plan to start using it as a payment tool in China? If yes, do you think you will suffer stress from China policy and regulation?
We definitely plan to keep the wallet free for now and hope to find more ways to support our supporters in China in a compliant way.
Bitcoin has entered the sight of mainstream already, what needs to be done to further promote it to general public’s daily life? Or is it still too early to even talk about this?
It’s never too early to talk about this 🙂 For the first few years Bitcoin had a bad branding problem, and many normal people who first heard about it only learned negative things. Our industry and community have come a long way. In my opinion the best way to show people the true power of bitcoin is to encourage them to set up a wallet, and then send them a few bits. If it sounds too good to be true is usually is; so I don’t try to convince anyone to buy Bitcoin because it might be much more valuable in the future (even though I believe this), I think it’s much better to explain why it’s so useful. By showing new users how to be their own bank, and how to transact with whoever else they want, this simple demonstration starts to get people excited. Ultimately, we have to explain why Bitcoin is better form of money to transact with.
As the leading bitcoin wallet provider, what is the plan and strategy of Blockchain on China’s bitcoin market?
We want to be the most useful and recommend wallet in China, so I’m curious to hear your perspective, what do you think we should do to grow our market share? If you were me, what
would you do 🙂 ?
Blockchain has developed matured wallet and explorer products, what will be the focus in terms of new products of Blockchain?
We have plans to expand feature sets on both our wallets and the explorer, making them more useful for new users. Our product roadmap has a lot of exciting things on it over the next 12 months! Sign up on our blog to stay informed of changes and improvements: blog.blockchain.com
When will Blockchain have support service in Chinese? Other China base company in this area provide 24/7 online support, will Blockchain consider similar level support?
Our wonderful teammate Elly helps promote Blockchain in the Chinese community, we’ve also started to create Chinese specific support resources which you can find here: https://support.blockchain.com/hc/zhcn/categories/201320003-%E7%83%AD%E9%97%A8%E8%AF%9D%E9%A2%98
You provide Buy/Sell function in your Wallet in other countries, do you have plan to add this for China users as well?
We would love to have this capability in the future and are always talking to potential partners to find the best and more compliant ways to do this.
It is very difficult to estimate how many bitcoin users in the world. Blockchain is the most successful and biggest Bitcoin wallet so you should have a word on this question. Can you estimate in general how many bitcoin users in the world (not bitcoin wallet)?
The most comprehensive answer I’ve seen to this question was just released by the Center for Alternative Finance at Cambridge. They collected information from the economic majority of the Bitcoin ecosystem and reported the following. As of 2017 it appears there are around 8.7M active users:
Do you think decentralized is an essential element of blockchain? Banking association’s blockchain (e.g. R3) is indeed decentralized or not? Do you think league chain and private chain will be successful?
There will be both public chains and private ledger systems (which have always excited) — in the form of distributed databases. I am not personally excited by the use cases presented by private mutual shared ledgers because ultimately those will be large cost centers, that are walled off to the public. They may serve some really important use cases; I just personally don’t find developing that technology very inspiring.
Some say that “SW is made as a soft fork to reach backwards compatibility, which does go against software engineering principle and will leads to technical debt. Significant changes such as SW should better be applied with a hard fork instead of a more risky soft fork.” Do you agree on this?
I personally think SegWit is good technology and appears to be well tested, but it also appears that it will not get adopted any time soon so at this point, while many of us in the community are still hopeful for a near term scaling solution, it will likely be some time before a compromise or new consensus emerges.
Many worry that in Lightning Network big nodes will have both operational and financial advantage thus make the market an oligopoly with big players like Alipay and Wechat pay, eventually cause centralisation of Bitcoin. How do you see this idea?
It’s really difficult to know how these systems will behave at scale and almost impossible to predict; which is why we need to start testing them now, so we can discover what the negative externalities are and mitigate them.
What do you think of stretch blocks?
I haven’t seen enough research yet to form an opinion. What do you think?
The number of Blockchain’s wallets are increasing rapidly. Can you estimate when the number of wallets will over 50 million?
I think we can get there in the next 24 months.
Bitcoin exchange platforms in China are becoming a problem of bitcoin’s decentralization because they are greatly affected by the Chinese government’s policy and regulation.Do you think it is necessary for exchange platforms to be decentralized?
A lot of teams have tried to build decentralized exchange platforms before and it’s really hard to do it well, especially from a reliability and service perspective. I’m hopeful that a well-designed and robust platform comes around at some point though.
The decentralized ‘localbitcoin’ mechanism, is it a correct way for exchange platforms to developing to?
I’ve always been fan of the LocalBitcoin platform though I think the vast majority of new users will prefer to work through a more familiar user experience with a simple checkout process.
Blockchain’s user experience is good but not very Chinese support friendly. A lot of translations are not updated. Will you optimize the tailor made user experience to Chinese users?
Thanks for this feedback, it’s really important that we make our wallet as friendly as possible. Can you point out where we have a few issues, my colleague Elly and I will get them fixed for you. Is there anything else you would like to see us improve or make better in the wallets? Any new features?
Can you estimate how much 1BTC will be after 10 years?
Hahaha, I don’t think anyone can answer this question predictably, so I’ll just say that Bitcoin is here to stay, and that the more that people learn about it, the more likely it will be here 10 years from now, more successful than ever.
I used your company’s online wallet, I think it’s not very consistent with the Chinese user’s habits, always have to re-enter the key when logging in, I have to search my email all the time. I think you hand over the security responsibility to the user.
There is always a trade off between convenience and security and we hope we strike a good balance between the two. If you want faster access, a lot of our users prefer our iOS or Android apps, which even allow you to login with just a fingerprint, the best part is, you can pair them with your main online wallet.
Will you issue bitcoin payment card to create a diversified bitcoin ecology?
We’ve looked a payment cards and at this time don’t really see them as that exciting of a feature, especially since they require using all the existing payment rails to settle and clear transactions. There are a lot of good options though if you want a bitcoin denominated debit card.
Is it possible to have a interesting rate by deposit certain amount of btc into my wallet?
Blockchain doesn’t support interest bearing accounts because we do not have access to the funds stored on the platform. This is really important though, because it means that you are always in control of your bitcoins. It’s an interesting idea and we know some other companies offer this.
Is it possible to set up my transaction fee once lightning network activate?
As for fees, users at Blockchain can always customize the fees they include in a transaction for make them as economical as you want. We try and provide a fast option for convenience, but anyone can select the advanced mode. As for how fees will behave on next generation transaction networks like Lightning it’s a bit too soon to know. We’re hopeful that the cost will be very minimal to end users though.
Will you provide some hardware wallet like trezor?
At this time, we don’t have any plans to support hardware wallet integration. There just aren’t that many people asking for it and we think it might make using bitcoin more inconvenient.