SLP345 Danny Brewster – Bitcoin Needs Builders

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Danny Brewster, Founder & CEO of FastBitcoins joins me on the show to chat: 

  • Dealing with regulation as a bitcoin business
  • Products and services for bitcoiners
  • Expanding into new markets around the world
  • Challenges and rewards of being bitcoin only
  • Bitcoin builders and why we need them

Links:

Sponsors: 

Stephan Livera links:

Podcast Transcript:

Stephan Livera:

Danny, welcome to the show.

Danny Brewster:

Thank you. It’s been a long time coming.

Stephan Livera:

Yeah, it has.

New Speaker:

Long time listener—and [supporter] on Patreon.

Stephan Livera:

Yes, that’s right. Thank you for your support, Danny. I know you’ve got a lot of things on—you’ve been in and around the Bitcoin world for a while now. So do you want to just give a bit of a background for yourself for any of listeners who don’t know you?

Danny Brewster:

I’ve been in Bitcoin far too long. I discovered Bitcoin end of ’11, early ’12. The price was much, much lower. I should have bought far more. I lived in Cyprus during the bail-ins. I had a crazy, stupid idea that was far too early, to give the local Cypriots an option to be able to use Bitcoin in their daily lives. It exploded in a great of fire, that the media ran with lots of incorrect narratives, but ultimately it was my fault through a whole bunch of and series of mistakes. But a lot of the ideas that I had have eventually played out in the market, and we have multisignature wallets and people have point-of-sale devices where they can now spend Bitcoin in stores—obviously everything with Lightning has been an amazing development. And I have been Bitcoin-only since I sold the last of the Litecoin that I mined in the peak of 2013, I think. And since that point in time, I’ve been purely Bitcoin-only. I think it’s the only one that we have any chance with changing the world with, really. I just continued to build whilst also sorting out the mess from Cyprus, and built what eventually became Fast Bitcoins. And ultimately as everything got cleared up, it’s gone from strength to strength, and life has changed a lot over the years. Bitcoin’s changed tremendously. A lot of the mistakes have been rehashed over and over—the same frustrations remain. There’s still a whole bunch of misinformation out there that gets parroted every day, but ultimately we just keep trying to build and bring more people into Bitcoin. I think that’s the only way that we can achieve critical mass, and that’s just trying to be a builder and to get more people into using Bitcoin.

Stephan Livera:

Sure. And so with Fast Bitcoins, do you want to just give us a bit of an overview? How long has the business been around now, and what are the main products and services Fast Bitcoins offers now?

Danny Brewster:

So to start with, I looked at the Bitcoin ATM business model for cash-to-Bitcoin transactions, and just watching people pay 25%-30% was infuriating. So initially I started off before the 5th money laundering directive was a thing, so we could do small transactions with little to no KYC, and things like that, for cash. And then COVID came along. At this point we launched officially in November or December, 2018. We had Lightning deliveries enabled. It was the first to offer Lightning deliveries as well. So from the outset we had that platform available, and we’ve watched other people make that possible now, which is great to see. And then when COVID hit, we had this chain of retail locations around the world in the UK, in some countries in Europe, in Canada, where people could go into a store and use cash to buy Bitcoin through us. But then unfortunately, when I was planning the business, I didn’t foresee the whole world going crazy and all of the retail locations closing down and things. And then also around the same time, we had some challenges with the 5th money laundering directive from the European Union, so we had to introduce customer accounts and we had to start doing KYC and things like that, which, as frustrating as it is as a business, we’ve tried to always maintain that we’ll have as light a touch as possible. We don’t do massive volumes of transactions per customer. Not with Fast Bitcoins anyway, like huge transactions. And we have added additional payment mechanisms so people can pay via bank transfer in Australia, can pay by Interac E-Transfer in Canada. We’ve launched recently in Brazil, where people can pay using Pix or the Boleto them. We also have about 50,000 locations where people in Brazil can take cash into the Lotericas stand and buy, or deposit to their Fast Bitcoins account through these lottery stores. And we’ve now taken the model of, We’re going to try and make it just possible to onboard more and more Bitcoiners in a platform that doesn’t promote shitcoinery, that doesn’t promote gambling. We want to help people use Bitcoin more as a savings technology or as a vehicle on to Lightning to actually use Bitcoin in their day-to-day life. We’ve got a whole bunch of plans. The future will just enable us to amalgamate and create even more of a bridge between the old and the new. So that’s where we’re heading. So we just want to make Bitcoin accessible. We have a bit of a tagline internally because we don’t like HSBC for the amount of shit talk they do about Bitcoin. And one of their marketing lines is, The World’s Local Bank. So we want to create The World’s Local Bitcoin Company to make them irrelevant.

Stephan Livera:

Right. And so it’s a range of services there. So I think as you were saying, starting out in the early days, it was around vouchers and ATMs, but now it’s more—there is an online service aspect of it, but also still offering different payment mechanisms there for people. And you mentioned as well around 5AMLD or 5th AMLD: so for listeners who aren’t familiar, that’s a big regulation that came in the EU and unfortunately caused a lot of problems for a lot of Bitcoin companies. So do you want to just outline a little bit about the challenges there and what the scene was like pre-5AMLD, and now what it’s like in the 5AMLD era?

Danny Brewster:

Yeah. So before the 5th money laundering directive came into effect, in some countries and some jurisdictions where they didn’t have local registrations or local guidance, you could do transactions under local laws or below a certain threshold without having to obtain your customers’ information and verify that information or, take much of a detailed in-depth view as to who your customers are. You didn’t have to treat everybody like a criminal or anything like that, or assume that every single customer—because they were buying Bitcoin—they were trying to fund some terrorist organization somewhere. And then when the 5th money laundering directive came into effect, basically what they said was, Each of the countries have to enact their own registration requirements for companies or people that are undertaking commercial activity, offering the exchange VASP, is the term they use, the Virtual Asset Service Provider. So if you are commercially offering an exchange, you have to be registered. And the UK took that guidance and went overkill, in my opinion. And we’re also seeing this in Australia now for new registrants. Chainalysis, the company, have run around and put their feet under the table with all of the regulators. So the regulators want your companys’ hot and cold wallet IDs. They’ve done it with payment processes as well. So if you’re trying to engage with new payment processes to create competition to drive down your fees and things for your customers, the language is always the same of what they’re requesting. We as a company openly, with the Australian Bitcoin Industry Association Body with Ethan from Bitaroo, and a whole bunch of other Bitcoin-only operators in Australia, we’re pushing back against it, because it’s just a massive overreach that’s practically impossible to actually implement because, as we know, we can create wallet addresses ad infinitum. So it is bonkers, it’s a massive overreach, and they’ve taken this guidance, and each of the countries that did it have taken their own approach. So some are much better than others, and then some have gotten into bed with private actors, like Chainalysis and stuff. So it’s been bit of a headache trying to navigate it all whilst also being out to continue providing a real good level of service to the customer. And I think we’re finding a balance of trying to not be too invasive where we don’t have to be, without it actually impacting the customer, and giving them the smoothest way of getting involved in Bitcoin. That’s all we can do. It’s either that, or we can create maybe ten Bitcoiners a month doing it personally, which isn’t going to help us reach the goals that we want to see in the world when it comes to Bitcoin—we need billions of people using Bitcoin, in my opinion. Others may disagree, I’m sure.

Stephan Livera:

Of course. Yeah, and I think it’s really interesting that you were pointing out the efforts there around at least trying to push back on government over-regulation. As my friend, Matt Odell is often saying, Bitcoin companies are maybe more [compliant] like the big “crypto” companies, that they should be fighting back against the government. Now that is a difficult thing because obviously, as you know, I’m a Libertarian. I’m anti-government regulation. I just also think it’s extremely difficult to do that when the government is basically holding that regulatory Sword of Damocles over your head if you don’t comply. And so that’s a real challenge, because what happens then is some of these Chainalysis and the like—other surveillance companies like CipherTrace and so on—that they are basically running around and trying to tell the regulators that this is the way Bitcoin is, and this is what should be done. But really it’s their own business model, which is quite frustrating.

Danny Brewster:

They’re literally trying to hoover up all of the data because it’s the only way they can have a semi-informed system to be a able to sell to other regulators and other providers. And if you’re not a client of theirs, then they don’t have your wallet information. It’s a best guess that that’s your set of wallets. If you are a client of theirs, you have to provide them inform, which helps improve their product. But what they’re doing is they’re just going, Screw actually doing the business side—let’s just go straight into the government and get them to do it all for us, which is extremely frustrating. But we are 100% pushing back. I even moved out of the UK to this little rock in the middle of the Irish Sea. If I disagree with the government’s decision, I can literally walk across the street, knock on the door, and tell them how wrong they are. And you can have a conversation about it. So it’s a completely different business environment. And I think Bitcoin, and probably it’s only Bitcoin, that gives you that freedom and that mobility to be able to migrate to where you’re going to get treated best. I think you’ve done it yourself escaping Australia when they were going insane with the power-hungry strictures during the COVID lockdowns and stuff. If it probably wasn’t for Bitcoin, you had a fiat-based job that was stuck in a city. Or if you’re stuck in London and you don’t have that freedom—building on Bitcoin has enabled me to come over here. The government here have been more than welcoming. They want to help create jobs locally. They’re all for Bitcoin companies coming here. And they have opened the door for some shitcoiners, but we’re working on that. We are actively orange-pilling the government and making it hostile for the shitcoin casinos. But yeah, it’s much better, and Bitcoin’s given us this freedom to be able to move and build elsewhere, while still accessing those same markets, which is magnificent.

Stephan Livera:

Yeah. It’s interesting you say that, because that’s actually part of this whole global jurisdictional competition aspect, because as we’re seeing, there are some up and coming countries that really want to create opportunities. And on the other hand, you’ve got these other nations that are perhaps starting to stagnate a little bit. And so that’s an interesting game, in some sense, that people can try to look for better opportunities in other countries as you are doing, and as many Bitcoin people are doing. But I suppose at the end of the day, though, you’re still trying to serve customers all around the world. So that’s an interesting balance that you’re trying to meet, because there are many customers all around the world who are in some of those countries that are very authoritarian or in other ways not ideal for them. But maybe if you could just share a little bit about some of the markets that you’re operating in and what it’s been like, just expanding out into new markets around the world?

Danny Brewster:

So when I set out, I didn’t want to create a company that was just based in one jurisdiction where we could get rug-pulled by the local government or the banking partners, or anything like that. So from the outset it’s been, Let’s create this wide footprint so we can become somewhat—dare I say—anti-fragile. It’s also—now that the regulatory environment is changing and shifting around the world, we actually find it much more conducive to a better relationship with the regulators because we don’t offer—sorry for the language—any bullshit shitcoins. We’re not looking to create a casino. We’re not wanting people to come and trade with leverage and degenerate gambling or anything like that. We speak to regulators all over the world. We’ve got FinCEN registration now for the US, but I’m not actually overly concerned with running with that too much just yet, because we’re in Brazil and the initial conversations that we’ve had in Brazil with our customers that have signed up from there—it’s just a population that get it so much more than what our customers in, say, the UK that have lived throughout their entire lives with a stable financial system. They’ve got instant bank settlements between banks. There’s no charges for using another bank’s ATM machine to get cash out. They have contactless payments in the stores and things. And inflation—although now is becoming an issue—in Brazil the headline numbers are already far higher than what they are across the US or the UK or the Eurozone. As much as I don’t trust the numbers coming out of the governments, the numbers in Brazil are probably far higher than what the government’s coming out with there. But as a population, they just get it. They are concerned around privacy and what information can be shared with the government and stuff like that, so we as a company are pretty adamant. I can sit here and say it, and people will say, Oh, you won’t say that until the police come knocking on your door or things. But I sit on this rock in the middle of the Irish Sea. So the Brazilian government have a long way to come and visit me for things like that. But then, even though we take that attitude and that approach, we still operate within the framework of their laws, so we have limits and things in place. So we don’t have mandatory reporting—if they change those limits, we’ll probably change them. Or if we ever have mandatory reporting to any government of every transaction or anything like that, I’d rather not be in that market because it’s not something that I’d ever endorse. I’d rather take the business out of the market than sell my soul for revenue, even though as a Bitcoin-only company—again, conducive to a better relationship [with regulators]. And they listen to us because we do deal with like AUSTRAC in Australia, we’ve dealt with the FSA here on the island, we’ve previously dealt with the FCA in London, FINTRAC in Canada, FinCEN and everybody. So having those conversations and being able to do it with a worldly view is actually kind of eye-opening. And I can tell you now, there’s more and more people in these departments becoming orange-pilled. And they see the crap that comes through the door from shitcoiners. And that’s what makes them so defensive. But when you actually go in and you have a level conversation with them, and honest about the good parts about Bitcoin, the bad parts—because believe it or not, they are some bad parts about Bitcoin, it’s not perfect, Twitter is probably going to kill me again for saying that—but yeah, it’s just having conversations. Like with anything, it’s all about communication. And if you run into regulators going, This is going to replace every central bank and it’s going to happen overnight and the financial world’s going to collapse—I don’t want to live in that world because that world is hell. If we get to that state suddenly overnight, I’d much rather take a slowly, slowly approach to replacing them, or replacing the people in these institutions with well orange-pilled, educated people.

Stephan Livera:

Right. And so I’m curious as well: are there places in the world that you see as being better from a Bitcoin point of view? Or maybe the regulators are taking more of a light touch versus the heavy touch?

Danny Brewster:

Just point to El Salvador. So here it’s a small island—so smaller places with smaller populations—this is like a double-edged sword. In Cyprus, it was really good to start with, and then it got used against me. And this includes marketing, the media, the government, the regulations, people’s access to police departments, and the corruptibility of local people. So when it’s working for you, it’s amazing. But it can also be flipped and used against you, and you can be targeted. And it’s amazing what writers will syndicate from some small press in a foreign language to label you as one of the worst people in the world. But ignoring my bitterness from the past, being able to move to these smaller locations and jurisdictions where you can have these conversations where people are much more accessible, I would say it’s definitely those types of jurisdictions—all the places where the president is buying the dip on his mobile whilst meeting other government leaders and stuff. To think this is where we are in the whole cycle of things—I’m still waiting for El Salvador to get a big dose of freedom from the US, courtesy of the IMF. But we’ll see how that plays out. So yeah, smaller jurisdictions where they’ve got the flexibility to be able to just have the conversations with the people that make the power, make the rules, that control the biggest gang on the island—which is obviously the police—they have the most guns and stuff like that. So yeah, the places where you can have the dialogue, I would say.

Stephan Livera:

Yeah, that makes a lot of sense. And now the way I see it and hear it and understand it as well, is that sometimes there are supra-governmental or supra-national organizations such as FATF, financial action task force, where they try to leverage pressure against other countries and say, Hey, if you’re not doing “enough” against AML, we’re going to blacklist you and we’re going to make you look like a tax haven and blah, blah, blah. And that’s really bad for you and your little country. You better obey our money laundering diktats. So that’s the counter-argument there. But the point you’re making though is broadly right, at least from what I understand. That perhaps some of the smaller nations tend to be a bit more nimble and more able to turn a little faster. Whereas obviously the big Western nations are like trying to turn this big cruise liner ship. So that’s at least how I’m seeing it.

Danny Brewster:

In the UK I know the FCA were internally celebrating companies dropping their applications. The applications that should have taken six months have now taken two years and they’ve got temporary lists and approvals and things. So yeah, it’s a bit of a shitshow from them. And as you say with FATF and stuff, here it’s labeled a low tax jurisdiction. It’s a British crown dependency. There’s zero corporation tax, zero capital gains tax—which is the big one for Bitcoiners—but the government here can’t create debt. So they have to live within their means. And my message and pushback from the government is, Sorry if you consider we’re a low tax jurisdiction, we live within our means, but sorry your government can’t live within theirs and they spend recklessly. That’s not our fault. What are we gonna do? Where should we spend this excess revenue if you want us to tax people more? People here are happy. Every cow on this island is grass fed, our milk tastes better, our meat tastes better, the air is fresh. What more do you want us to do? Like just take money off people? Because you want to spend more, we should tax people higher? Yeah, it’s insane. But I see your point with the [blacklists], because they did it to Malta. We were looking for a European subsidiary, because there’s some more legislation coming in into Europe called MiCA. So we’ve gone with Ireland for structural purposes. Plus it’s also 20 minutes over the water to us. We were looking at Malta as well, because all of the accountant-friendly money left Cyprus before the bail-ins and moved to Malta, so it became the accounting capital of Europe. And now they’ve been added to this [blacklist] for the time being, which would’ve just caused headaches trying to do business in other of the world for us. Because, like you say, they have this stick they can use to beat the jurisdictions like that.

Stephan Livera:

Yeah. Nevertheless, I still believe getting more people invested in Bitcoin in general is going to help overall. And now I understand that there are people in the Bitcoin broader world who don’t necessarily share that view, that you have to go no-KYC because they’re going come for everyone anyway, eventually. But I think there are different approaches to that. I think there might be some who think that, longer term, if Bitcoin becomes legal tender, then some of those concerns will wash away over time. And it obviously depends on what the focus is: those who are more focused on privacy, versus those who are more about the wealth creation or savings aspect of it. But I want to go back to what you were saying just around inflation and the understanding around it, because as you were saying with Brazil, people understand inflation a lot more intuitively than in some of the Western world nations. So one thing I’ve seen or heard of is that a lot of people end up—even in the Western world—going and gambling. They’re gambling on random meme coins or meme stocks or things like that. JPEGs is the latest one. So how are you finding that there in terms of trying get the message out and the education out there as well on the Bitcoin side?

Danny Brewster:

It’s difficult because most people are being educated through sales material, and that sales material is geared towards pushing them into speculating. And when all of the noise around the whole industry is about that, it’s purely educational—and you’ve also been through this with Ministry of Nodes and trying to create an educational platform. And we’re going to be doing some work with the Ministry of Nodes in Australia—really looking forward to that—to be able to try and actually speak to people. And through advertising—we’re literally going to have to market in an educational fashion. So we’ll be doing exactly the same thing, but we’re just going to make sure that our message is as pure as can be. There is always this purism/product trade-off. Ultimately, we are a business and we think that we’re doing things the right way. I’m pretty sure that people will disagree as they always do, especially on Twitter. All we can do is just try and remain pure to what we think is right. And so far, we’ve got a common message that we’ve been putting out—from the very beginning—is: we do what we have to do. We do as much as we have to do. We won’t step over that, but I’m not going to go to jail for anybody. And I want to also help create as many Bitcoiners as we can, but educated Bitcoiners that understand why Bitcoin exists. And if people want to use it for privacy reasons, or to move themselves and their family across borders, things like that, we still the philosophy that everybody is open to using Bitcoin, even your worst enemies. So you just have to accept that, even if you are the most privacy-focused person in the world, or you just want to see the number go up and you are using it as an investment. You have to be accepting that both of these entities will be able to use Bitcoin, including the people that you hate the most on the planet. So I’m little bit on the fence with it. I don’t have the time. I just want to give more people access to something that’s useful—period—these days.

Stephan Livera:

Yeah. So with the different products out there, I know as you mentioned with the POS terminal, can you tell us a little bit about that and how you’re seeing that going in some of those countries like Brazil, as you mentioned?

Danny Brewster:

So we haven’t actually put our own hardware into Brazil, but the one time—the biggest humbling moment for me—was watching a guy that created a random video in a store in Vancouver buying a protein bar and some chocolate using Lightning a couple of years ago, just randomly getting tagged in that video. It was just insane. It was like, I built that in my loft whilst I was fighting extradition. And then things like BTCPay Server came along when Nicolas Dorier obviously got fed up with BitPay, which is amazing. And just even here on the island, there’s CoinCorner, which is literally in the office next door. People might say, Oh, you’re a competitor. I don’t think anybody with the same philosophy anywhere in the world, be that Swan, River, Amber, Bitaroo—anybody that is saying the same messages about being Bitcoin-only and trying to educate people—I think we’re all trying to grow the market of educated Bitcoiners, as opposed to competing for the same business. So I cheerlead them all and I tell them like, Corey, everybody, that I love what they’re doing. And we’re borrowing—like I literally look and go, this is what they do great. How can we do that and incorporate those things? Swan has amazing content marketing that they’ve done in the harsh environment of the regulations around marketing and stuff. So hat tips to everybody. But on the island, like CoinCorner, I’ve got loads of stores where you can go and pay at the point-of-sale using Lightning. I’m probably the most prolific shopper on the island using sats. I got my hair cut yesterday and then my lunch the day before using Lightning. And being here and seeing people do it all over the world—Bitcoin for payments is still very, very early. So we’re not really focusing on that as a business. It’s more of a—I literally built the ability to pay with Lightning in 2018 as a weekend thing. Oh, this will be cool if we did this on devices as well. I had the ideas in Cyprus back in 2013-2014, but it was far too early, really. And it’s still probably for me a bit early for payments on Bitcoin. We haven’t got enough users of Bitcoin, if you will, in the world just yet. But stage one of our vision is to create that mass of Bitcoiners so we can start using it more for payments and stuff.

Stephan Livera:

Yeah. And I think the other aspect that makes it difficult operating in so many different countries is dealing with the fiat side of it. Obviously the Bitcoin side is the easy side, but having to have fiat banks—and as I’m sure you’re aware, and some listeners might be aware—is that there are a lot of bank shutdowns for Bitcoin companies. So they often get their accounts shut down. I know of colleagues all over the industry who have dealt with this. What has that been like for you with trying to operate across different countries and still trying to keep the fiat rails working? Because obviously you want to be able to sell Bitcoin to people—they need to be able to get the fiat into you.

Danny Brewster:

Yeah. So back in 2013, we used to get e-mails from the banks with everybody CC’d into the same e-mails, be that us, Bitcoin Suisse, BTC-e, Mt. Gox was still around at the end. Everybody that was trying to speak to banks at that time to get bank accounts were literally copied into the same rejection e-mail. It was laughable, my data protection. It just doesn’t really count if you’re a Bitcoin service provider or anything. You’re trying to do anything around Bitcoin. BitInstant was on that e-mail—Charlie Shrem’s company. There was a whole bunch of—like Bitstamp and stuff like that. It was like, No, we can’t do it. And then things have changed. It’s still ridiculously difficult, especially if you’re an individual and you’re acting like a sole trader and things, or just an independent trader. If you’re doing large payment volumes through your accounts and stuff, they’re all over it. And as soon as you mention Bitcoin, they jump on it and they close you down. The freedom to do business with whoever you want should be a thing, but they have this moat that is protected. So there’s been some pushback in Australia around deplatforming and stuff, but again, because of our footprint around the world, we get to have these conversations, and we’ve been talking to banks about integrating, providing them the infrastructure to offer their customers access to Bitcoin through our infrastructure that we’ve built. And just speaking to the compliance departments and they’re so anti-Bitcoin, because the sad fact is: 95% of payment fraud issues that they have touches crypto at some point along the chain, because it’s the best way for the fraudster to get an exit because it’s irreversible. And it’s much easier than getting cash out of an ATM, to get irreversible funds. So I see why they have so many issues with Bitcoin as a whole, because when your day job is literally just dealing with this shit, it is the bad end of the stick. And they’re dealing with people that have being ripped off or scammed or coerced into sending somebody Bitcoin or some other garbage coin as a means of separating them fraudulently from their cash. Then yeah, those people are the ones that are making decisions to close peoples’ accounts. So I get it as to why they would feel that way, but being able to have those conversations, again, just communication with the right people, enables you to build and maintain a relationship. And we do a whole bunch of safeguarding with our customers to make sure they’re not being coerced into buying Bitcoin to send it to some guy that tells them that they’re mining diamonds in Zimbabwe. They’ve never met this person, but they think they’re engaged. You’d be absolutely astounded to hear some of the stories, and if we can stop those from happening just by, again, communication, talking with customers as they’re using us for the first time, then I think that’s a positive thing. And we communicate this with the banks and the financial service providers, and the payment platforms may get it. But again, it’s all just about communication.

Stephan Livera:

Yeah. And I think the other angle with that, as you say with communication, is that: as things scale, as a lot of people come—and so the Bitcoin industry as you are very well aware is not just like a linear sort of thing. There will be moments where it just comes like a massive wave, and then it’s doldrums for a little while. I guess that’s something you would’ve seen in your Bitcoin career, haven’t you?

Danny Brewster:

Yeah. And every time we go through these insane cycles where we get this mass influx of people, I get pretty tired pretty quick. There was a conversation yesterday, I think it was Bitcoin Magazine that hosted it between Alex Svetski and BitBoy Crypto. [And BitBoy Crypto,] what a clown. These people have platforms and people listen to them and they sit there talking about all of the people they’ve helped make money. Everybody’s a genius in the bull market when money’s being created like it is being, across every asset class. He fails to mention that on the back end of every trade, there’s two parties. So if one person’s winning, the other person’s losing in that trade, ultimately. So somebody’s either selling too early or someone’s buying too late. So they can talk about how much money they’re creating for their followers and stuff, but these people disappear the minute everything goes to shit. And we go through the winters. That’s when all the best conversations happen, that’s when Bitcoin seems to move forward the most, where the most innovation seems to occur. We hash out the problems amongst ourselves, the people that actually have been around and understanding it. And don’t get me wrong: there’s people that could discover Bitcoin today that would know far more than me in three months time and just get it even better. There’s just so much to know and understand. And they could very much surpass what I know. I’ve been through the cycles and I’ve seen the people come and go, and it’s the same salespeople and marketing departments that are just wishy-washy. They’re only here when the times are great. There’s a guy that always does courses, quite like the influencer type, isn’t it. But when he comes around, I know we’re hitting peak. He’s the guy on YouTube—

Stephan Livera:

James Altucher and Tai Lopez—when those guys show up.

Danny Brewster:

Tai Lopez, Tai Lopez—when they’re around, and when they’re mentioning Bitcoin or whatever, it’s like, Yeah, we’ve hit peak. Soon it’ll be the winter again—can’t wait—so we can get back on with some business and actually continue building the good stuff. Instead of having to field a hundred calls a day from people that you went to school with, asking if you should buy this or you should sell that—it’s actually building stuff.

Stephan Livera:

Yeah. And so then one thing that I’ve noticed, even for me personally—and for me, that’s because I’m a content creator, so I can just point people to this episode when I get the question and be like, Hey, this episode, or Hey, read this article, and things like that—so I guess that’s a similar thing. But just generally, even when you’re trying to scale a business, not everything can be done person-to-person. There are times where you need to automate things, where you need to have systems. But I guess the challenge for you is around finding that right balance of building and automating things, versus what things are just done person-to-person because we’re not at that point yet. So bringing that back then to the Bitcoin ethos and building usable products and services: what does it look like for you guys when you’re thinking about products and services that you want to offer? Do you workshop them? Do you play around and then see what’s the feedback from the market?

Danny Brewster:

If it’s me that comes up with an idea it’s probably at stupid o’clock in the morning before most of the people are awake. I’m either in the gym, on the treadmill, listening to a podcast thinking, Oh, this is a [fantastic idea,] how could we use this for—I listen to your podcast and a couple of others, but I try to listen to things outside of the echo chamber. I think you definitely have the most educational [podcast] because you’ve got the technical side down far more than what you’d probably even give yourself credit for, but you’ve got obviously the economic background and things like that. Plus you’re now traveled and you’re experienced in the market. I remember when you first went full-time with the podcast, and I was like, Yes, you’ve got some great content here—but that’s enough smoke up your back. So yeah, just listening to content outside, like other business leaders, things like that, to try and just gauge what other businesses are doing, what they’re working on, how that would impact us. Anything that we can take from them and how we can apply that. I just listened to The Innovation Stack from the co-founder of Square, with Jack. Listening to that was great. There’s no experts in innovation. So it’s just trying to pull ideas from other places and things like that to see how we can apply those lessons to what we’re building. And then I will pitch any of my ideas to the team, the team can do the same back to me and everybody else. We just hash them out. And then if we can build a prototype, we’ll do that. We’ll work on that and see, and then we’ll test it into the different markets where we can get it signed off, and we’re happy that it’s not going to cause us too many problems or anything like that. The most fun project was probably Heartbeat, which allows customers to dollar cost average on every new block. So they’re literally buying on the heartbeat of Bitcoin, a tiny piece of demand for the new blocks that are created. But that’s definitely like a hardcore maxi-type focus product. But just good things like that. And it also educates new customers into like, What is Heartbeat? And what is the heartbeat of Bitcoin? And for me, it’s that every new block that’s created—it means Bitcoin’s still alive and we’re moving forward.

Stephan Livera:

I’m curious as well your thoughts on where stablecoins are going? Because one thing that I’ve noticed, at least from my travels as well even in South America or Central America, it seems that there is a bit of a demand for them, even though those of us from the Western world think, Ah, what’s the point? I’m just HODLing Bitcoin. But it does come across the radar a little bit when you’re talking to people from those parts of the world, where there seems to be a very strong demand for it. And I guess the question then is, Do you see a role for that as part of Bitcoin companies? Should Bitcoin companies interface with stablecoins? Or should they just stick to not even touching stablecoins?

Danny Brewster:

Strike has recently had a bit of flak for this. I would say that their sales pitch, or their pitch to the world, is Bitcoin, but it’s actually stablecoins behind it. And they use Bitcoin for the transfer mechanism. Just looking at the way they position it you wouldn’t think that from the outset, so I can see why people are pushing back on that. Especially where these people want purism versus product and they’re more on the purism side. As for other Bitcoin companies, I think stablecoins will probably solve a problem for some companies, companies that don’t have local banking infrastructure that they can fall back on like Tether, or any of the other places. But I think they all require a level of education for the customer to understand that, Yes, this digital representation of the dollar is held here, not here. These are the risks, because you are introducing additional risks, and Bitcoin carries risks as well. But I think as long as the customer knows what they’ve got and where they actually stand with it, I think, yeah, there’s probably going to be space—both will exist, whilst arguably the dollar is a little bit more day-to-day stable against Bitcoin. Ultimately that’s what it is, even though it’s slowly dying.

Stephan Livera:

Yeah. And it could also just be the legal privilege aspects of it. There’s no capital gains when you spend fiat money.

Danny Brewster:

Yeah, it’s a very difficult problem with an imperfect solution. So maybe there’s somebody much smarter than me out there that will come out with a solution to that problem. But I look forward to that day, and I’ll probably use it. And I would say to other people, Yeah, you should probably use this as a product, but like everything in life there’s trade offs. Just try and be as informed about them as possible. And even with that statement, I think most people don’t care in their life. They just use whatever is easy, and they have no concern for privacy, inflation, until it’s too late. They just go with whatever is easy or whatever the crowd’s doing.

Stephan Livera:

Yeah. And I think that comes to the conversation as well around is the goal mass adoption? And maybe people have their own views on this about mass adoption: is mass adoption the goal? There’s some segment of the Bitcoin world who’s out there saying, No, the focus should be the Remnant. So I’m wondering where you stand on that idea. Should the focus be the mass adoption or should the focus be the remnant or is there something else?

Danny Brewster:

I probably stand in a very different position to Alex Svetski on this. I’m pretty sure that’s where the Remnant idea [came from]—

Stephan Livera:

Oh it was around well before, but Svetski was recently writing about it and speaking about it.

Danny Brewster:

Yeah. He’s ran with it. I think Bitcoin has the potential to make the world a better place, but to do that, I think we need as many people exposed to the ideas as possible, and also educated to actually understand. I think Bitcoin needs it, to be able to carry on into the future in the next couple of generations, that understand why there’s a hard limit on the issuance, and not people that have just existed in a world where that’s just the thing and then they don’t take it seriously anymore. I think there’s a multi-generational approach to the whole Bitcoin position in the world. I’m quite happy to say that I don’t want mass adoption overnight, because that would mean that so much has collapsed elsewhere in the world that a lot of people in the world are living in a shit situation, well, beyond garbage. I wouldn’t want to live in that world. And I wouldn’t want to be one of the haves in a world of have nots, because you’re pretty easy to find. The privacy people will be like, Ha, I told you. So let’s build, let’s make improvements. Bitcoin’s flawed. Remember there’s bugs in Bitcoin that need fixing. Let’s get all of that done, and then we can discuss if it’s going to be for the few or for the many.

Stephan Livera:

For sure. And so any final tips or words out there for people who are looking to become builders in the space? Do you have any tips or thoughts for them?

Danny Brewster:

Talk to others. If your idea is great, people won’t necessarily steal it. It takes a lot. It’s not easy. Like any startup, it can fail, but if you look to others and you get guidance—even in Bitcoin now, there’s Bitcoin-only investors and things like that. If VC money is what you’re looking to do and you’re willing to take those trade-offs, there’s Ten31, Fulgur, Stillmark, Sats Standard. There’s the Bitcoiner Ventures which you’re involved with, obviously. All of these people are working to back the long-term view instead of the quick flip—let’s look to exit as soon as possible with a massive multiplier. All of these funds are now here and there’s going to be more—I’m pretty sure of it—to be able to get backing and capital to build your ideas. Bitcoin needs builders. If people don’t back the companies or use the companies that are trying to set the right standards and create these ideas that align with, with your needs—if somebody turns around to me and says, Oh, Binance is a fraction of a percent cheaper, I’ll use there, then we’re not really aligned. But they’ll get there eventually, hopefully. So we need more builders. And with more builders, we get more power in markets—the size of the market will grow. People will be exposed to your materials and messaging that you’re putting out, which is only going to orange pill more people if you’re doing it from a position of what a lot of people say are core Bitcoin values. So yeah, we need more people, and I’m always open to talking to people, but just remember: it’s not easy, long days, hard work. But when you see somebody using what you’ve created on the other side of the planet, it makes it absolutely worth it.

Stephan Livera:

That’s fantastic, Danny. I think that’s a great message to finish the show with, and maybe we’ll call this episode that: it’s Bitcoin Needs Builders. So Danny, thanks for joining me today.

Danny Brewster:

Thank you. An absolute pleasure as always. We hope to see in London soon at the conference.

Stephan Livera:

I hope to see you soon.

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