In this conversation, Dr. Padraig Corcoran discusses his research on Bitcoin as a medium of exchange, focusing on the use of spatial data from OpenStreetMap and BTC Map. He explores the dynamics of merchant adoption, the role of community initiatives, and the implications for policymakers. The conversation highlights the importance of grassroots movements in promoting Bitcoin usage and the potential for growth in merchant acceptance as technology improves.
Takeaways:
🔸Bitcoin serves multiple purposes: unit of account, store of value, medium of exchange.
🔸OpenStreetMap is a crowdsourced geographical data project.
🔸BTC Map helps identify merchants accepting Bitcoin.
🔸Adoption of Bitcoin as a medium of exchange is growing.
🔸Quality of crowdsourced data can vary significantly.
🔸Community initiatives play a crucial role in Bitcoin adoption.
🔸Government policies do not directly influence merchant adoption.
🔸The Lightning Network is vital for facilitating Bitcoin transactions.
🔸Merchants often accept Bitcoin to attract a specific customer base.
🔸Bitcoin can function as both a store of value and a medium of exchange.
Timestamps:
(00:00) – Intro
(01:08) – Dr. Padraig Corcoran’s background & his research on Bitcoin and Spatial Analysis
(02:31) – OpenStreetMap; Pros & Cons of crowdsourced geographical data
(06:19) – How did BTC Map use OpenStreetMap to represent Bitcoin merchants?
(10:08) – What are the insights from analysing the adoption of Bitcoin as a medium of exchange?
(15:25) – Nation level vs. Grassroots Bitcoin adoption; Bitcoin circular economies
(18:37) – Bitcoin adoption in El Salvador vs Berlin
(19:51) – Are merchants accepting Bitcoin without them knowing about it?
(23:14) – What are the factors influencing merchant adoption?; Learnings for policymakers from Dr. Padraig’s research
(25:19) – What kind of Bitcoin businesses are on BTC Map?
(27:49) – Is Bitcoin only for savings?
(32:30) – What should Bitcoin builders focus on?
(33:34) – What is Dr. Padraig’s perception of Bitcoin as money?
(35:23) – Closing thoughts
Links:
- https://x.com/pcorcoran9
- https://x.com/btcmap/status/1993737818271633638
- https://link.springer.com/article/10.1186/s40854-025-00871-z
Stephan Livera links:
- Follow me on X: @stephanlivera
- Subscribe to the podcast
- Subscribe to Substack
Transcript:
Stephan Livera (00:00)
Hi everyone and welcome back to Stephan Livera podcast. We’re going to be chatting about the spatial use of Bitcoin as a medium of exchange and joining me is Dr. Padraig Corcoran. He is a reader and deputy head of school in the School of Computer Science at Cardiff University. Now Padraig, you did some interesting research and tell us a little bit about, you know, just a quick background on yourself and what got you interested in this idea.
Padraig Corcoran (00:28)
Okay, I’m an academic from Cardiff University and my background in terms of research is really geographical information science, spatial algorithms and I’ve done a lot of work on crowdsourcing, crowdsourced geographical information, geographical data.
and in recent years I got quite interested in Bitcoin and I started to pivot my research somewhat into looking at some of the open research questions or problems in the Bitcoin space and to date I’ve written quite a few papers on Lightning Network and more recently I’ve written a paper and published a paper on the analysis of the use of Bitcoin as a medium of exchange using crowd-sourced geographical data so drawing from my previous experience
in our expertise in that space.
Stephan Livera (01:24)
Fantastic. Yeah, and as I was looking through I thought it was really interesting. I think this first came up when I saw the Yeah, like the the BTC map guys, I think tweeted this out or posted this out and And I think I retweeted this and I thought that’s actually kind of interesting that you sort of built this based on the open street map stuff which obviously I’m sure you know that more than I do but for listeners give us a brief overview on that like
OpenStreetMap contrasted with, let’s say, Google Maps.
Padraig Corcoran (01:51)
Okay, okay, so for this analysis I was using data which is from a project known as BTC map. So BTC map, you can kind of think about it as a kind of a social layer on top of OpenStreetMap.
So what is OpenStreetMap? OpenStreetMap is a crowdsourcing project for geographical data and it’s been around for over 20 years. It was founded in 2004 by a British guy called Steve Coast.
And at the time, Steve Coast, he got a bit disillusioned or dissatisfied with the state of open source and free geographical data. So there was lots of good geographical data available at the time, but it was proprietary and not free and open. For example, in the UK, we have a national mapping agency known as the Ordnance Survey, and they’re a very well-funded national mapping agency, and they capture very rich and very good quality geographical data.
but this data is proprietary. Some of it is open, but you have to use it within certain terms and conditions. So.
So Steve Coase decided that it would be a good idea to create an alternative and free and open source geographical data set to rival these proprietary data sets. this this kind of story might sound familiar. The Linux operating system was created by Linus Travals and that was motivated by.
by his dissatisfaction with at the time there wasn’t a free and open source Unix operating system. So he created Linux. So I digress. OpenStreetMap is a free and open source geographical data set and it’s created through the use of crowdsourcing of data. So volunteers mapping their local communities ideally. So this has got some
pros and cons. So it’s crowdsourced. So there are advantages and disadvantages to the use of crowdsourced data. So one of the advantages of geographical crowdsourced data is that the interior and the data, and in practice sometimes, the data can be of very high quality. In the sense, if you’ve got a local region, the best people to map
or create a geographical representation of that region are the local people who live in that region. For example, if you take a feature like a park, the locals will know all the entry and exit points to that park, which somebody who’s just a visitor to the region may not know. So it has, in theory, the potential to be very, very rich data, much richer than other data sources. But…
There are some disadvantages to crowdsourced data in the sense that the quality can vary over space and time as a function of the contributors. so if you have.
a particular geographical region with a lot of enthusiastic and hardworking contributors who are really motivated to map their geographical region, you will have high quality data in that region. While on the other hand, if you have some region which you’ve got no, there is no crowd, there is no contributors in that region, no people contributing to the crowd sourcing process, the data can be very, very weak or of poor quality. So it can be, so,
So traditionally if you have a data set you might have a single metric to say that the data in this data set is good quality or bad quality but for crowd source geographical data it’s difficult to have a single metric of quality that you can apply to the entire data. Instead the quality can vary over space and time. So BTC map was a kind of a social layer.
or a community that came along and they decided that we want to facilitate people to not just save their satoshis but also spend them and in order to facilitate that people need to know or be aware of which merchants accept Bitcoin in exchange for goods and services. So they decided that they would leverage or use OpenStreetMap to represent or store that data.
So they created this initiative to try and social layer on top of our community on top of OpenStreetMap where they would promote and encourage the mapping or representation of merchants that accept Bitcoin payments in OpenStreetMap. So maybe I can talk a little bit about how the data is represented in OpenStreetMap.
Stephan Livera (06:25)
Right, yeah. yeah, so guess for listeners who maybe if you haven’t been around, if you’re a newer listener, you can also check my earlier episode with Nathan from BTCMAP where we spoke a bit about that. But yeah, I think it’s an interesting, definitely a cool project. There’s an app, there’s a website, and people can now use this. Like if you’re traveling to a region and you want to be able to spend your Bitcoin, well then that’s one way. And interestingly, I think it’s also getting used and hooked in even on the square side with their…
thing also. like it’s really kind of becoming an interesting community and Bitcoin ecosystem play in a way that it’s kind of helping the merchants and the spenders find each other. And so that’s kind of really interesting there as well. So yeah, did you want to go on there on what you were going to mention there?
Padraig Corcoran (07:14)
Yeah, so I can talk a little bit about how it’s represented in or how the BTC map community went about representing merchants in OpenStreetMap. So OpenStreetMap is kind of an open platform where, you know, so you have all geographical features will be represented using geometrical features representing the location of the feature, but also somatic information represented using tags, okay?
OpenStreetMap doesn’t limit the tagging conventions that you can use. So you can tag features how you wish. So the BTCMap community came up with a tagging convention of representing merchants in OpenStreetMap. So initially the convention has changed over time, but now there’s a standard convention where you can very easily query the OpenStreetMap data
is to extract all the merchants using a standard tagging convention.
Stephan Livera (08:14)
Great, and so this enables people to understand what type of vendor it is, what type of merchant it is, is it a cafe, is it something else, et cetera.
Padraig Corcoran (08:22)
Yes,
the merchants will be tagged with many different tags describing the different characteristics of the geographical feature or merchant in this case. So merchants will be tagged with, for example, there is a standard convention for representing cafes where we use a key value pair of amenity equals cafe. then you would also signal that merchant accepts Bitcoin as payment. You would also add the BTC
equals yes.
Stephan Livera (08:53)
Right, and as I understand, even on the website, they show things like on-chain only or lightning also, this kind of thing. obviously it’s nowadays in-person commerce generally is being done with lightning, but maybe…
some higher value things, if it’s like thousands and thousands of dollars and maybe it’s online then okay, maybe they just stick to on-chain. I guess these are just different things. But let’s get further into what you found. So as I understand, you went through and you were analyzing this data to try to, I guess, pull out some interesting insights or understand what’s the quality of this data. So can you talk to us a little bit about this particular paper that you wrote? What was your main goal there?
Padraig Corcoran (09:32)
Yeah, so I was interested in doing analysis of the adoption of Bitcoin as a medium of exchange. So money can form, can serve many different purposes, a unit of account, store of value, medium of exchange, and you can measure adoption along all those dimensions. We’re interested in measuring adoption as a medium of exchange. So,
So Bitcoin is based on a blockchain and all transactions are stored in the blockchain. So each transaction basically represents the transfer of ownership of Satoshi’s from one pseudo anonymous address to another pseudo anonymous address. But just examining the blockchain alone, even though the data is unencrypted and it’s open, it doesn’t give you lot of context about the transaction that took place. because you just know the pseudo names.
don’t know where the transaction took place, what context it took place in, was it part of a medium of exchange and if so what type of medium of exchange. So generally to do analysis of the adoption, lots of people have done the analysis of the adoption of Bitcoin along many different mentions but generally you know to do that analysis you can’t just rely solely on the blockchain data. You generally need to augment that data with some external data sources to give you a bit more color or insight into what’s going on.
So
Stephan Livera (10:53)
Gotcha,
so I guess let me just quickly explain that. guess how I understand it just so listeners can, if they’re newer, they can get that. So if you look on the chain or if you look on mempool.space or a block explorer, you can look up the transactions, but really what you’ll see is like inputs and outputs. And you may see, BC1Q, whatever, whatever, whatever, it received this amount of coins and some other one has received that amount of coins.
But what do you actually do with that? How do you actually understand what’s going on there? Now, of course, there’s more analysis and people can look at things like, OK, they’re going to try to cluster those addresses to understand, these are probably an exchange, or this is probably a custodian there, or this looks like maybe it’s a big merchant there. And I guess this looks like it’s an individual or a plebs wallet, per se. And so guess there’s some insights around that, potentially. But I think there are some very powerful insights to be drawn from looking at this.
OpenStreetMap data.
Padraig Corcoran (11:46)
Yeah, so you want to get a greater insight into the actual transactions, what they mean. typically want to, many analysis of different types of adoption, look at kind of what other alternative data sources can we use beyond just the blockchain data. So in the past, people have looked at web traffic data to exchanges to get an insight. So for example, in given country, is there a lot of people visiting this particular exchange which might signal an interest or use or adoption of
of Bitcoin in the past, people have looked at social media data to try to know, to try to, is there a lot of positive sentiment around Bitcoin and also certain exchanges publish reports about the number of users. So there is some other data sources that you can use, before, so before our study, we looked at,
and we wanted to look at or the insight or the idea was to look at merchant data. So could we look at, could we identify merchants that accepted Bitcoin as a medium of exchange and use that as a signal or an indicator of adoption as a medium of exchange? So we just know that the data will tell us whether or not a merchant accepts Bitcoin as a medium of exchange. It will not tell us
the volume of transactions that that merchant is accepting via Bitcoin. So it’s just an indicator. And I sometimes like to think about it as a kind of analogy would be when we’re trying to measure commercial activity in a given urban area, we regularly use football data as an indicator of commercial activity. So here we’re merchant adoption as an indicator of use of the medium of exchange.
So the hypothesis is based on the fact that or the notion or the idea that if in a given geographical region there are a lot of merchants that are accepting Bitcoin as a medium of exchange, that kind of suggests that there is some sort of market factor or something incentivising those merchants to accept it because there is some kind of customer demand for that.
Because if it’s just a single merchant that accepts Bitcoin payments, they may accept it for other reasons beyond commercial demand. Yeah.
Stephan Livera (14:05)
Right, like more ideological reasons, let’s
say, because they believe in the mission of Bitcoin, etc.
Padraig Corcoran (14:11)
Yeah, so if you if so, if you if we believe that if you have a large number of merchants that are Bitcoin payments in a given geographical region, that suggests that it’s it’s that there is a market demand for it, that these merchants are.
Stephan Livera (14:24)
Yeah, and I guess here we’re getting
into like the whole circular economy thing and maybe you want to touch on that because to be fair, there are also like communities of Bitcoin Maxis around who are going around and trying to onboard merchants and try to encourage people to earn and spend in a particular region, whether that’s, know, Elzante or Berlin or Prague or somewhere else. Can you touch on that a little bit of any insights around the circular economies?
Padraig Corcoran (14:50)
Yeah, so we try to identify some of the factors which were maybe driving adoption in some of the regions. And we looked at some of the macro and micro macroeconomic factors to see if there was a correlation between them. So microeconomic factors are more kind of factors which are.
driven by individual choices, while macroeconomic factors are more larger scale factors such as government policies or government interventions. So we try to see was there a correlation, which doesn’t imply causation, but we want to see was there a correlation between some government policies and merchant adoption. So we looked at the US.
So Trump administration has recently proposed the idea of a strategic Bitcoin reserve at the US, at the country level. But some of the states have followed suit. And many states are proposing their own state level strategic Bitcoin reserve. So I just saw on the news recently, Texas passed a bill to have a strategic Bitcoin reserve for their state. And Florida has proposed a bill to have a strategic Bitcoin reserve in their state. So we looked at the US.
we split it into two groups states which had proposed a strategic Bitcoin reserve and those which had not and we wanted to see was there a statistically higher merchant adoption in states where there was kind of this top-down let’s say government support or government strong sentiment coming from the government that they were supportive of Bitcoin adoption and we found that
You know, there wasn’t a significant difference between the number of merchants in states where there was a proposed Bitcoin strategic reserve as opposed to those states which didn’t have a strong, didn’t have a proposal, didn’t make a difference, you know, so that kind of top-down macroeconomic factor did not seem to influence, it seemed to be independent, the adoption by merchants seemed to be independent of that, statistically speaking.
Stephan Livera (16:38)
Gotcha.
So it didn’t make much of a difference.
Interesting. So I wonder, I mean, if we were to kind of speculate a little bit or try to put our heads into the minds of, you know, people on the ground, is it, is it just, you know, it doesn’t matter that much to them? Is it just more like if I think, you know, when I talk to people like, let’s say Francis from bull Bitcoin, and he’s in Costa Rica, and he’s kind of talking about Bitcoin jungle is like this, you know, great bottom up story.
And then maybe on the other side of it, maybe there are people who saying no, you should be in favor of the SPR or favor in favor of top-down adoption because maybe that helps drive some of this local behavior also. I’m curious any reaction on that or any any hypothesis or theory you have there?
Padraig Corcoran (17:35)
Yeah so we looked at El Salvador as well and so obviously they had quite they’re quite pro Bitcoin with making Bitcoin the illegal tender.
Stephan Livera (17:48)
legal tender in 2021, although
it’s taken away, but still a lot of people are using Bitcoin. So it’s kind of a complicated situation. But of course, they are definitely pro Bitcoin.
Padraig Corcoran (17:57)
Yeah, so we looked at different regions in El Salvador and we found that one of the places that had greatest adoption or greater than other areas in El Salvador was the region of Berlin. So we tried to understand why did this have greater adoption than other regions in El Salvador. And we kind of hypothesized that this may be a consequence that they’ve got a lot of kind of
strong social networks, bottom-up grassroots initiatives to promote the adoption of Bitcoin as a medium of exchange in that region. that seemed to be… So what a region, despite the pro-Bitcoin stance in the country, didn’t have that same level of adoption that we witnessed in El Salvador, sorry, in Berlin. So, yeah.
Stephan Livera (18:39)
in Berlin, in El Salvador. Yeah, I
know there’s a pretty strong community there and I know they’ve been really driving hard and it’s maybe a point of pride for them that they’ve got so many merchants who take Bitcoin in that area compared to other areas.
Padraig Corcoran (18:54)
Yeah, so that seems to be the case because we didn’t see that level of adoption in other regions, our urban areas in El Salvador.
Stephan Livera (19:05)
Yeah. Now, one other thing I might ask this also because what about the case where merchants are using or accepting Bitcoin without knowing it? Right? So as an example, in the Czech Republic, there’s this thing, I think it’s called, I don’t know how to pronounce it, Qwerko, Q-E-R-K-O. And so it’s like, you know how when you go to restaurants and you scan a QR to get the menu and you can also pay on that same thing? I think they’ve got a similar system like that in some parts of the world.
Is that, I presume those are also being built into BTC map, but I’m not 100 % sure there.
Padraig Corcoran (19:40)
I’m not ⁓ 100 % sure either.
Stephan Livera (19:42)
Yeah, okay. Because that could be where maybe the shop is not natively taking Bitcoin themselves, but it’s kind of happening in the background through their payment provider. And I guess now in the case of Square in the US, I think there is a hookup there. Like Square is actually hooked up with BTCMAP such that when that merchant turns it on, it will even show in BTCMAP. they’ll even, I think even inside the app, can see, I think, I’m not 100 % sure because I’m not an American, I don’t have cash app, but I believe you can see
on the local map merchants around there who take Bitcoin. So any thought on that?
Padraig Corcoran (20:18)
Yeah, I think that’s good that we have this, we have Square’s system talking directly to BTC map, which definitely improves the quality of the data. So if a merchant turns on their accepting status, then that will hopefully immediately be represented in BTC map. And likewise, when they…
no longer accept Bitcoin if and when then that will immediately be represented in BTCMAP because one of the greatest challenges with BTCMAP is trying to ensure the quality of the data of the data and because
Stephan Livera (20:51)
Right, to keep it up to date. Yeah.
Padraig Corcoran (20:55)
It’s a moving target so merchants are joining and leaving, predominantly joining at the moment. So BTCMAP have a system where they try to verify a merchant frequently at least every 12 months to confirm that it is still accepting Bitcoin payments. So if we had Square’s system talking directly to the BTCMAP or OpenStreetMap dataset,
you know we wouldn’t need that person in the middle to do the manual verification so that would definitely help a lot.
Stephan Livera (21:30)
Yeah, and so I guess, are there any other insights that you see on Bitcoin communities and like circular economy communities or just like the meetup group in that town? Do you see anything there? Like maybe if there’s like a strong meetup group that has got a lot of people in that meetup, that maybe that town is going to have higher quality data because there’s obviously more Bitcoin maxis around.
Padraig Corcoran (21:52)
Yeah, so BTC map has this concept of a community where you can create your own communities and have kind of mapping parties, let’s say, where you try to go out and map the local region. they seem to be really strong.
really kind of very influential in ensuring the quality that you have a large community of individuals so it’s not just falling on the responsibility of one person. So there is that community structure within the BTC map project and think that plays a strong factor in ensuring the quality of the data.
Stephan Livera (22:32)
Yeah. And I guess, is it then also a corollary of the point you were making earlier that, let’s say, whether those states in the US had an SBR bill or not, didn’t really impact on the ground merchant adoption? I guess the corollary would be, does that mean circular economies can exist easily without national, without government national top-down adoption?
Padraig Corcoran (22:58)
I think they can, but we need to ensure that ideally the government is not adversarial with respect to adoption.
Some government top-down support helps but it’s not necessary. Once they’re not putting in roadblocks, I think we can still have adoption as a medium of exchange quite successfully. If we have enough of grassroots social network community-driven initiatives to onboard merchants and educate them on the benefits of using it as a medium of exchange and also
You know, like you mentioned before, it’s very dependent on having good payment systems built on top of Bitcoin, like the Lightning Network. think as that technology, Lightning Network is great, but it has some limitations. I think as that technology continues to improve and develop, it’ll become easier to onboard merchants because the UX will be much easier both for merchants and customers to use.
Stephan Livera (23:56)
What can policymakers learn from your findings if you had to say anything to a policymaker in either a region or a country? Is there anything that they should keep in mind from your research?
Padraig Corcoran (24:10)
Well, I think you can’t legislate adoption. think that that’s important. That’s one finding, because even if you have legislation, which is very pro adoption of Bitcoin, it doesn’t necessarily translate into adoption by merchants and customers. So you need to educate and encourage the bottom up communities.
So it has to be a mixture of top down and bottom up I believe.
Stephan Livera (24:39)
When it comes to the type of business, do you notice any trends there? Like is it typically hospitality? Is it typically cafes and bars and restaurants that you see on Bitcoin map and BTC map? Is there a reason for that? What do you think?
Padraig Corcoran (24:53)
Okay, so we found that predominantly the majority of merchants were in the hospitality sector. like, you mentioned, bars, restaurants, cafes. And we can only kind of hypothesize or speculate why that is the case. So one thing that it tells us is that because these are very customer facing industries, it suggests that the technology is sufficiently developed.
so the UX is sufficiently developed that it can be used quite easily by merchants and customers without creating any roadblocks. We also hypothesize that maybe some merchants are using it as a mechanism because it’s customer facing business. They’re using it as a mechanism to try to attract a different…
persona of customers, those who are interested in Bitcoin. So if they potentially stick a sticker on their business saying that they accept Bitcoin as payment, maybe that attracts a different type of customer to their business.
We also found that there was quite a lot of merchants in the technology industry who were using Bitcoin as a medium of exchange. And we hypothesized that this is because people in the tech industry, they understand the technology and the benefits of Bitcoin and also have the technical expertise to integrate it into their payment systems. Another interesting…
thing that we found is that in the health sector we found that there was a lot of merchants in the alternative health sector who were accepting relatively a lot of merchants in the alternative health sector that were accepting Bitcoin as payment. And that was quite interesting because there has been some previous studies that have found that a correlation between
libertarianism and an interest in the use of bit kind. that seems to be present here because generally accepted that there is a kind of a correlation between alternative medicine and libertarianism.
Stephan Livera (26:55)
Yeah, interesting. It’s kind of like how a bunch of yoga people tend to be into like veganism as an example or whatever. Like there’s just like correlations that you’ll find. So obviously people who more libertarian minded will be more inclined to accept Bitcoin as kind of just an obvious thing. What about this kind of, there seems to be a narrative that Bitcoin is only used for saving. It’s not really used for payments. Is that really true based on your findings or not true?
Padraig Corcoran (27:21)
It’s difficult to say conclusively. So we’ve just, as I said at the start, we’ve just mapped or done analysis of merchants accepting Bitcoin. We don’t know the volume of payments they actually process.
Stephan Livera (27:34)
Gotcha, yeah, because they could just put it up and not actually get that much volume, but on the other hand they might actually get a decent amount of volume. Let’s say if the meetup organizer goes there all the time or they organize their meetups there or things like this.
Padraig Corcoran (27:44)
So we did look at certain, so we looked at a couple of, because the quality of the data varies kind of over space and time, we picked a couple of.
a small a couple of geographical regions where we were confident that the data was of good quality in the sense that there was a large number of merchants in that region and they had all would be mapped in that region and the vast majority of them had been verified in the previous 12 months so we picked them we looked at the regions Prague and also Berlin and El Salvador so we looked at them the number of merchants
in those regions and looked at the percentage of the total number of merchants in those regions. So in Prague we found that in the case of restaurants, 6 % of all restaurants in Prague accepted Bitcoin payments, while in Berlin it was over 75 % of merchants in that region that accepted.
Stephan Livera (28:44)
which is incredible
when you think about it, right? Like the level, the sheer number, the sheer percentage. So I guess the other question that I’d have for you, and I’m not sure if you looked at this, what about merchant drop-off, right? Because this is another thing, historically what we might have seen is sometimes people get really overzealous and they’re out there trying to orange-pill merchants, get them all on boarded, but then there’s not enough people actually spending. So then after a little while, the merchant turns it off, they drop off, let’s say.
⁓ So maybe that’s something that might come out in the data over time of, okay, maybe there was like a burst of activity and then it kind of drops off and then, you people stop or does it sort of sustain?
Padraig Corcoran (29:26)
So we find that adoption is growing over time. this data that I used the data at a fixed time stamp in my paper in 2024, I think was when I cut off there for my analysis. at that time there was 11,000 merchants represented in the BCC map. just as of the 1st of January,
this year there’s closer to almost double that number of merchants represented in BTCMAP. So adoption seems to be growing almost exponentially. If you have plotted the curve, it’s really shooting up, particularly in recent months. I’m not too sure the reasons for that, but that suggests that there might be some merchants that are dropping off, but they are far outweighed by the number of new merchants who are coming in. adoption seems to be growing.
Stephan Livera (30:18)
Gotcha, so there’s
some churn factor, but it’s growing still dramatically. And it kind of makes sense if you just think about the recent news, Like the block with, I think it’s up to four million merchants who could turn it on. I believe that it’s an option, so they may not all turn it on, but still that’s massive. And then the other big one, which I had an episode with Karel from Money Badger in South Africa, he turned on 700,000 locations, which is just incredible when you think about it. And so.
Now some of that is because it’s being turned on in a way that the merchant doesn’t really have to do a lot, right? It’s just kind of, it’s like a small, it’s like one of the payment options that they already had anyway. And then he managed to find a way to sort of plug into that. So it doesn’t require like training that.
receptionist or that staff member on the ground, okay, here’s how you do the Bitcoin payment. Like historically, that’s what it used to be. It used to be like they would have like a separate device that they had to go and get and keep that charged and train them on how to do it and all these other things. Whereas now, you know, with Lightning Network, better systems, better technology, it’s all improving.
Padraig Corcoran (31:19)
Yeah, for sure. And I think we can get kind of these kind of steps. So currently at the moment, it’s kind of gradual, continuous growth over time. But as we have these larger, you know, point of sale organisations coming in, such as Square, we can just get a sudden step change in the number of merchants, you know, you know, very, very quickly. So so so adoption.
Buy merchants doesn’t have to continue the current trend of gradual increase. We can potentially get those step changes when we get these larger organisations coming in.
Stephan Livera (31:55)
So ⁓ if you were advising Bitcoin only builders, where should they focus? Wallets, merchant tools, community building. What do you think?
Padraig Corcoran (32:04)
I think a combination of all. I think, you know, in order to… So Lightning Network has…
really important as a payment system for merchants to accept payments because on-chain transactions, they don’t scale in terms of the latency of the transaction and also the cost of transaction. So these payment systems such as the Lightning Network are really, important. as that, Lightning is great, but there is potential to improvement. There are lots of challenges around liquidity management and so on and so forth. So obviously we need to, if we can improve
the payment systems, improve the lightning network, will be easier to onboard merchants, giving a better UX to everybody. And so we need to improve the technology on one end, but that goes hand in hand with the education and building communities which promote the adoption of Bitcoin as a medium of exchange.
Stephan Livera (33:01)
How has working on this research changed how you personally think about Bitcoin as money?
Padraig Corcoran (33:07)
Yeah, so.
Well, it’s kind of a little bit in reverse. I became very interested in Bitcoin and I would say Bitcoin actually changed my research more than my research changing my perspective on Bitcoin. was very, very pro-Bitcoin and that changed the focus of my research was influenced by that. So kind of the influence flowed in the opposite direction, let’s say.
Stephan Livera (33:38)
Yeah, and I think what we are finding is this people from all walks of life, right? Doctors and lawyers and CEOs and investors and, you know, university, you know, professors like yourself, researchers are finding Bitcoin and they’re making their own contribution in their own way. And then, you know, as these papers that you write and do and research.
get out there, then more people find that and it gives a new level of legitimization and then there’s a whole new round of people who sort of see that and think, okay, well, you know, it must be legit. There are people doing papers about it and you know, there are legit communities and builders and merchants and people using it and so I think it’s all part of the process. So yeah, it’ll be really interesting to see how things develop. I know it is interesting sometimes in the community, people sometimes try to set.
let’s say the store of value against the medium exchange in some ways, but I mean, for me, I’m in favor of both, like let’s do both. And so I really see that as the way it’s going to go. I think the other thing is people sometimes forget that if you’re a merchant, that’s how you can stack Bitcoin, right? So that for them, it could also be the store of value, right? It’s just, that’s just how they’re earning their Bitcoin. So,
I think these are some of the things that we’ll see there. Any final comments or any other bits of research that you have coming up or something else you want to mention?
Padraig Corcoran (34:59)
Yeah, so I’ve been doing a-
As mentioned at the start, I’ve kind of had two research directions in this space. More recently, I’ve been focusing on this analysis of mapping using crowdsourcing data, merchants accepting Bitcoin, but I’ve also done a lot of work on some of the theoretical problems in the Lightning Network and trying to improve the algorithms and systems there. So I’ve done a lot of research on that space as well. But yeah, I think there’s lots of
You mentioned academics working on Bitcoin. think it’s great. I’m a computer scientist working on Bitcoin, I think irrespective of your academic discipline, people from lots of different academic disciplines can contribute to Bitcoin. There’s lots of interesting and open research problems which are very impactful that academics can contribute to.
Stephan Livera (35:50)
Fantastic. Well, I will ⁓ put the links in the show notes and listen as you can follow Porik on xpkokorin9 ⁓ Obviously links will be in the show notes. Porik, thank you for joining me on the show today and sharing your insights
Padraig Corcoran (36:05)
Okay, thanks for having me, Stephan.