Thanks to those of you who have contributed to the Bit. I was ~$2,700 in the hole last week, and I’m now down to only $1,525. When I get down to zero, I’ll delete this banner. I’ve cut down the losses by 1/3; now I just need some corporate love…
Monster news cycle for bitcoin this week. Some comments / reactions.
1) 21e6 raises a record round of funding for a bitcoin company; $116mm for whatever it is that they actually do. (I kid…I’ve got a pretty good idea what they are up to, but confidentiality, yada, yada.) If you look at their investor list, you can probably triangulate. The news about the news there is that another serious bitcoin media company nearly broke the story over the WSJ. Would have been a great get, and I’m sure they are going to scoop a bunch of other big stories in the future. (And no, I’m not referring to myself in the abstract. No scoops here.)
2) Jamie Dimon might dismiss bitcoin, but I’m counting at least three former JPMorgan managing directors who have switched to bitcoin executive roles in the past six months. The big news, of course, was that Blythe Masters, the original creator of the infamous credit default swap (aka the financial product that ruined our global economy for a few years) joined stealthy Chicago bitcoin startup, Digital Asset Holdings, as the CEO. Masters was one of the top dogs at JPM (even her name sounds powerful), and her migration into the space puts her up around the top of my already obsolete “most powerful women execs in bitcoin” list.
Masters joins Paul Camp (CFO at Circle) and one of our entrepreneurs-in-residence (still in stealth) as JPMorgan executive alumni who have broken ranks with Dimon on bitcoin.
3) Erik Voorhees revealed himself as the CEO of altcoin exchange, ShapeShift. [We’re investors.] I loved everything about this story. Love that the company is outstanding (easy, fast decentralized alt-coin trading), growing like crazy even though most alt-coin volumes are way down along with bitcoin, and well positioned from a regulatory (don’t touch fiat) and product (would work with any kind of digital asset transfer in the future) perspective. Love that its CEO, who is one of the most popular guys in the industry, says, “Actually, I don’t want people to know this is me at first. Let’s see if the product is good enough with Beorn as the CEO” and it doesn’t backfire! Oh, and love the fact that Erik punked everyone with the Beorn Gonthier LOTR shapeshifter pseudonym. Well played across the board.
4) Probably the subject for a standalone post, but for those playing the home game: the euro is down about 35% since last May vs. the dollar. The Ruble is down 50%+ and the Yen is down 20%. There is very likely going to be a point in early April when we can say that bitcoin has “outperformed the Euro” over the past twelve months even if bitcoin hovers around $300. That’s incredible to me given how sideways the price has been, and goes to show how real bitcoin’s solution is to the global currency wars that are ramping up.
The MIT E-Lab is a well established (20+ year) program that helps startups by matching them with MIT & Harvard business school students for a semester. The E-Lab is now looking for cryptocurrency related startups at various stages, so apply if you think this could help your efforts. (You don’t need to be local, but a c-level exec has to be in Cambridge frequently.) To apply, or for more info on E-Lab visit http://elab.mit.edu/.
The 2015 Texas Bitcoin Conference will highlight how Bitcoin 2.0 and the blockchain will impact tomorrow’s ultra-connected and decentralized world of business and society — “changing the way we do everything.” The event will feature a thought-provoking keynote delivered by celebrated economist, technologist and author George Gilder, who will discuss themes from his upcoming book, Bitcoin & Gold: Information Theory of Money. Other panelists include Steven Stockman, former U.S. Representative for Texas’s ninth congressional district, Sumabala P. Nair, IBM business analytics and strategy architect and a leading member of IBM’s Project ADEPT, as well as sponsors such as Rivetz, Factom, GoCoin, Cryptocurrency Partners, The Dapps Fund, Lighthouse Partners, PeerTracks, Tally Capital, Transform Public Relations, and the Digital Currency Council. Conference registration is $150 for a full pass. Discounts for students are available. Hackathon registration is free.
Inside Bitcoins is the largest bitcoin and blockchain technology focused event series worldwide. Join Inside Bitcoins when it returns to New York for the third year. Speakers include Barry Silbert, Marc Hochstein, Brian Kelly, Dan Morehead, Perianne Boring, Gil Luria, and more. Plus, TBI Daily readers get 10% OFF any pass with code TBIDAILY. See you there!
Jobs, Jobs, Jobs
Bolt, San Francisco (VC-backed)
-Stealth startup focused on consumer applications of Bitcoin.
-Open positions: Security Engineer, Ruby Engineer, UI/UX Designer, Executive Assistant.
-Check out Bolt (bolt.com) and email email@example.com.
Elliptic, London (VC-backed)
-Full-service bitcoin custodian.
-Open positions: Data Scientists and Front-end developers.
-Learn more and apply at elliptic.workable.com
Today’s Tid Bits
Former JPMorgan Executive Blythe Masters Joins Bitcoin-Related Start-Up
Blythe Masters, a prominent former executive at JPMorgan Chase, has left JPMorgan’s commodities unit and is joining Digital Assets Holdings, a Bitcoin-related start-up that is looking to use Bitcoin’s underlying technology to streamline financial transactions. Ms. Masters, a star at JPMogran, has already had talks with the Federal Reserve, New York State’s Department of Financial Services and the Bank of England as Digital Assets Holdings works to navigate bitcoin’s pending regulatory environment.
BitPay Inks Partnership Deal to “Decentralize 3D Printing”
3D Hubs, the “AirBnB of 3D printers,” has partnered with BitPay, the popular Bitcoin payment processor. The two are working together on 3D Hub’s global network of 3D printers to decentralize their printing network. 3D Labs will now, “make it possible for everyone to manufacture and purchase products without traditional centralized institutions in between.”
Bitcoin Exchange itBit Revealed as US Marshals Auction Winner
itBit, a New York-based bitcoin exchange, has revealed that it was one of the three participants in the latest US Marshals Service (USMS) bitcoin auction. itBit secured 3,000 BTC ($888,000), which was the smallest total accumulated among the three winners. The other two bidders, whom are not yet public at this time, won 27,000 BTC ($7.9m) and 20,000 BTC ($5.9m) during the auction.
ShapeShift Raises £525k, Reveals Erik Voorhees as Creator
ShapeShift, the instant bitcoin and altcoin exchange, has received £525,000 in seed funding from Barry Silbert and Roger Ver. The Swiss-based platform allows users to swap between 25 digital currencies and tokens without user accounts or registration. Erik Voorhes has also come forward as ShapeShift’s creator and CEO, after operating under the alias, Beorn Gonthier. According to Voorhees, the funding will go towards improving the exchange’s engine as well as marketing and legal work.
Coinbase Joins Facebook and Uber in Internet Lobbying Group
Coinbase has joined the Internet Association (IA), a Washington D.C. based public policy group that lobbies regulators on Internet freedom and innovation. Amazon, eBay, Facebook and Google are also members of the IA. The group was founded in 2012, and Coinbase in the first bitcoin company to join the IA.
Secretive Bitcoin Startup 21 Reveals Record Funds, Hints at Mass Consumer Play
A stealth bitcoin startup, 21 Inc, has been quietly convinced some of the biggest names in venture capital for the past year and a half to invest $116 million in firm, which hopes to turn the technology behind Bitcoin into a mass-marketed phenomenon. 21 has raised the most ever by a startup in the digital-currency sector. However, the precise nature of the company has not yet been revealed. The lead investors in the startup include Andreessen Horowitz, RRE Ventures, Yuan Capital, and Qualcomm Inc.’s venture-capital unit.
Reddit Adds Bitcoin Payments to Merchandise Store
RedditMarket, Reddit’s merchandise store that sells a variety of Reddit platform, is now accepting bitcoin. Coinbase will process users’ payments. It remains unclear whether the popular website will pursue bitcoin payments on its main platform at a later date.
Bitcoin Scam MyCoin Investigation Yields Multiple Arrests in Hong Kong
Last month, the bitcoin exchange MyCoin collapsed and was revealed as a pyramid scheme, defrauding investors of an estimated $400 million. An investigation is now underway in Hong Kong and five arrests of “mid-level hustlers,” have already been made. All five suspects were women who handled the face-to-face fraud and fundraising for the site.
Could Bitcoin Ease the Pain of Africa’s Migrant Workforce?
In 2014, almost $40 billion was sent to Africa from Africans living abroad, with the cost of sending money remaining high. On average, a fee of 12.3% was charged to money transmitters to send $200 home, with the total fees amounting to $1.4 billion. Western Union and MoneyGram control 50% or more of the remittance market in most Sub-Saharan African countries. Bitcoin could be the solution to this problem, with companies like BitPesa, which allow workers to send money from overseas to Kenya and Ghana for a flat 3% fee, growing quickly. So far, bitcoin has run in to regulation in Africa, but it is already proving to be more cost efficient than the traditional border remittance services.
Bitcoin Social Network ZapChain Launches Micropayments Tool
ZapChain, a Bitcoin-centric social network, is once again enabling micropayments with the launch of a new in-house tipping mechanism. The site will now feature a green “Tip” button beside both questions and comments. ZapChain is not attempting to make a profit from the tool, but instead just expose more of its users to bitcoin.
Ross Ulbricht Defense Asks for Re-Trial
Ross Ulbricht, the mastermind behind the illicit online marketplace, was found guilty by a federal jury in New York on seven charges. His sentencing will take place in May, where people are speculating that he could receive the maximum penalty of life in prison. Ulbricht and his defense team are requesting a re-trial, based on a miscarriage of justice that is detailed with the prosecution and the judge conspiring to deny Ulbricht’s fifth amendment right to due process.
Opinion: Bitcoin May Be What Gets Us Real Net Neutrality
Peter Van Valkenburgh of WIRED believes that Bitcoin could provide more competition to Internet providers, giving internet users more control over their own networks. Users could lease out their superior broadband connection and in return receive Bitcoin. Valkenburgh also argues that encryption would play a major role in managing one’s network traffic, but at the same time provide a shared infrastructure that will allow for a better connection. Overall, he believes Bitcoin and the low-transaction-costs involved can provide the tools to better build these networks, and ultimately unlock net neutrality.
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