In this episode, Pavlenex joins Stephan to discuss the strategic importance of funding open source in the Bitcoin ecosystem. They explore how open source support benefits companies, the stages of open source project development, and recent updates on Stratum V2 and BTCPay Server.
Timestamps:
(00:00) – Intro
(01:09) – Open source is not philanthropy
(05:07) – Reaction to MARA Foundation’s initiative
(06:40) – Stages of open source projects
(11:51) – The necessity of economic incentives
(16:42) – AI’s impact on open source contributions
(19:48) – “Upstream decisions, downstream impact”
(24:33) – Open source as a complement to R&D
(28:46) – Navigating corporate funding & control
(31:14) – Identifying & supporting the right projects
(35:56) – Directed grants vs Open grants
(39:55) – The importance of supporting open source
(42:41) – Updates on Stratum V2
(47:02) – Updates on BTCPay Server
(48:47) – What is the Samrock protocol for BTCPay?
Links:
Stephan Livera links:
- Follow me on X: @stephanlivera
- Subscribe to the podcast
- Subscribe to Substack
Transcript:
Stephan Livera (00:00.708)
Hi everyone and welcome back to Stephan Livera Podcast. Today I have my friend Pavlenex rejoining me on the show. Many of you will know him for his work on BTCPay. Of course he is working on SV2, Stratum V2, a lot nowadays also. And yeah, welcome back to the show Pavleniks.
Pavlenex (00:16.832)
Hey Stephan, it’s a pleasure to be here. I believe this is my fourth time on the show, breaking my own personal records.
Stephan Livera (00:22.928)
Yeah, it’s been a few. That’s right. Yeah. Well, I saw you wrote an article recently, so I thought it would be good to chat about it. Obviously, it’s related to open source and Bitcoin and building in this in this industry, let’s say. And I guess there is this maybe there’s this mindset that
open source is philanthropy. as I understand your article is challenging that idea. So give us give us the pitch. Why is it not philanthropy?
Pavlenex (00:52.878)
Right. So my article isn’t really challenging it. I do believe there is a little bit philanthropy involved in open source. Maybe when we speak about open source, all of us Bitcoiners immediately think how funding works in Bitcoin and then we try to project them to broader open source and how funding works there. But yeah, my main problem with that article that I wrote, it was inspired by, we can talk about it in a moment, what inspired me. But what I’m arguing there is that
that companies actually can benefit from supporting open source on a strategic level. So they can even gain profitability out of it in the long term. And there is like multiple benefits that a lot of companies don’t really think of when they think.
about supporting open source. So my main goal there was to try to explain to corporations or even to people in general who think that open source is just or rather supporting open source is marketing stunt or, you know, goodwill or just like, you know,
Let’s just do it because it’s a good for community. So philanthropy. So yeah, I outlined some of the talking points that I personally use when I speak about open source funding and try to pitch it to corporations. So yeah, hopefully it motivates people and corporations to, it motivates maybe.
contributors to better pitch their own work when they speak about their work publicly or try to get funding or it helps corporations understand.
Stephan Livera (02:26.263)
that’s interesting.
Because you’re saying it’s also like, put it this way, on the fundee recipient side, maybe there’s an angle of how they pitch it also, that maybe they’re not pitching it in the right way, so that the funder side of it doesn’t understand the value, because they’re not pitching it in the right way. So I guess in a sense, you’re not only pitching, you’re not only speaking to companies or wealthy individuals who might be engaging in FOSS funding, you’re also kind of helping people understand where is the value here.
Pavlenex (02:56.138)
Yes, and I also want to give context on like, why am I the person that can speak about this? So I worked in free and open source software for nine years now. Seven of those years I would, I was funded through grants, but like I worked two, two and a half years without any support early on in my career.
So I’ve been on the receiving side of free and open source funding, but also I try to help others build career in Bitcoin, get funding, get jobs in the companies. And I try to pitch free and open source funding to the various companies. So I’ve been involved in this ecosystem for quite a while. And I think I’ve seen ins and outs in both sides. Like I see arguments that corporations have against. see how
Individual contributors may be undermined their own contributions and work because I often hear like, maybe why would somebody pay me to play around and just do what I like? So they don’t really see that their work actually benefits a wider ecosystem. So yeah.
Just to be also transparent, I’m currently funded by Spiral. So just to give clarity, like when I speak about things, I’m also personally funded by a grant. So just want to be transparent there. So I have a pretty practical perspective of how things work. And I’ve seen maybe some incentives being broken as well on how things shouldn’t work. So we can also talk about that. But maybe the best way we can start discussing this a little bit more concretely is like why I was triggered to even write this article.
Stephan Livera (04:30.424)
Right, yeah. Because you saw some reactions, I believe it was to Mara’s announcement, right?
Pavlenex (04:31.797)
So.
Yeah. Yes. Correct. So Mara announced Mara Foundation, I think, a few days ago. They described this as an initiative to support Bitcoin security, open source development, education. And while it was greeted with a lot of, you know, optimism and open source community was cheering for it, great. Another, you know, way for people to get funding.
I started reading comments and I saw a bunch of Mara shareholders there saying, wow, they are diluting us again. How does this bring value? Like why is this philanthropy now needed? So I then remembered, wait, I have a bunch of talking points that I wrote for quite a few years. Maybe I can put it in public and maybe it helps people understand that.
Supporting open source if done properly can be very strategic and it can be an investment in my opinion for the entity supporting open source and there are various reasons Why that can happen, right? So just to be clear when we speak now about open source funding. We will not be speaking specifically about Mara or this specific situation. We will be speaking
about open source funding a bit broader and just using Mara as an example of why I was triggered basically to write all of this.
Stephan Livera (05:50.285)
in general,
Stephan Livera (05:56.293)
Yeah, gotcha. So let’s start with the start. in your article, the first one you mentioned is this idea of upstream decisions, downstream impact.
Pavlenex (06:03.968)
Yeah, just before we jump a little bit into those specific talking points, I think we just need to cover a little bit more of the stages in which open source project is. Because my talking points are not really for all of the stages or like, yeah, it’s not the same for every stage in which open source project is. So.
My colleague, Connor Ocas from Spiral wrote a great article a couple of years ago about, I don’t know how exactly he called it, but it was a framework for open source funding. And he outlined a couple of stages there on how Spiral sees these stages. I personally see them a little bit different because I approach them from maybe project perspective, not like entity who is funding a project perspective. So there are, think…
a couple of phases. First one is maybe we can call it baby or early stage, where actually philanthropy and grant funding and community funding is extremely important. This is early stage where projects may not even have users. They have some technical idea of how they want to solve a problem maintainer maybe has a vision. But for outsiders, it’s not really obvious like what they’re doing, why they should support it. They don’t really understand it yet.
So that’s where I think organizations like Spiral, OpenSats, HRF, Tether, a bunch of other entities that currently support, for example, Bitcoin ecosystem specifically bring a tremendous amount of value because they have experts who understand in and out of the ecosystem and they can recognize if idea is basically valuable or not. So this early stage is somewhere where potentially corporate funding may not make
fully sense for, you know, just from the broader perspective, but I think it does make a ton of sense for like donation wise and just like companies supporting, sorry, not companies, these organizations giving early support to the project. Then there is like a stage where community, this is the second stage, maybe we can call it community formation, where community gathers, starts to form, somebody is using a project.
Pavlenex (08:19.81)
Maybe they’re getting some community donations already, but what they lack is often, and this is what I personally see a lot of projects in this stage, they lack strategic support. So they are doing something, they are getting some donations, making users happy, but maybe they’re having troubles holistically thinking how their project can grow. So at this stage, they’re not really missing money. There is some money, but…
What would be also ideal besides money is strategic support or somebody just to listen to maintainer and try to help them out. Whether that’s drafting a roadmap, documentation, thinking about adoption or how adoption should look like. I don’t know, in my experience, Pyro does that well. They don’t really throw money at the organization or individual. threw a bunch of people in the organization. They try to reach out.
learn about obstacles you’re facing. They’re trying to help you think strategically. They are trying to have you think about ecosystem at a wider scale, about Bitcoin ethos when you make decisions and all these other things. And I think this is a stage where this kind of support is also important. And then we hit maturity stage. Let’s say we are out of baby stage. We hit this early adoption community formation stage. Now the project is in a maturity stage.
So this is where we have a lot of contributors joining. Most of them are not funded. They are providing tremendous amount of value. There is maybe one or two big, we call them power users maybe. So things are starting to scale. And this is usually where community donations or smaller donations don’t really help projects scale from that because it’s not enough to have a couple of folks just.
And I speak this from personal perspective on multiple projects. Like I’ve seen this on BTCPay server, on Bitcoin design, on Stratov2. I’ve seen projects hitting this stage where users maybe don’t even understand the value of supporting the project. And this is the stage where I actually think that companies can really help the project and that all of these corporations that I speak about can really provide tremendous amount of value for themselves and for the project.
Stephan Livera (10:41.186)
Interesting. Yeah, I guess I’m curious there because it’s like, I mean, many things in life, you know, they kind of follow like a power law distribution. And sometimes they’re just very large user usually like a big company or a very, you know, wealthy individual like, you know, like a Jack Dorsey, who can fund things at that larger scale, right, that it’s kind of just beyond just small, you know, smooth few community donations and things like that. And so I guess
What you’re talking about there is once the project has reached a certain level of maturity, it may require larger forms of funding, but I guess you’re going to try to make the case that it’s not just philanthropy. So can you spell that out for us?
Pavlenex (11:20.14)
Yeah, exactly.
What I will try to make a case of is like up until this stage, philanthropy is helpful. After the maturity phase, actually it can be counterproductive because you need economical interest, you need incentives, you need entities funding projects who are thriving on the project. You need users who are making money out of the project creating. So project is generating value for them and they see support not as a philanthropy, but necessity. And there is like multiple reasons why.
it’s a necessity. But yeah, I argue that once the project hits the stage, starts getting the users, starts being used, because to be fair, corporations are not going to use some small project that somebody just wrote. They usually look at the code base, they see if it’s regularly maintained, if it’s something that they can rely on, and then you can get adoption. So it’s not really like just some… It happens, but I haven’t seen many convincing cases of when a company wants to adopt open source software, they will just adopt a random repository.
restart building of it. Usually there needs to be certain credibility behind the project for them to look into it. And then, yeah, I guess just the fourth stage, I will very quickly speak about this one because I don’t think it makes a lot of sense. It’s like more sustainability phase where a company reaches the point where they would actually, it would be counterproductive to have like a single source of funding.
because there can be corporate control over the project or all of these different other things. So in the sustainability phase,
Pavlenex (12:54.496)
I think it would be great if there are multiple entities supporting the project. Of course, this depends on the size of the project as well. But ideally, you want to diversify funding and you want that funding to be based on meritocracy. I want to literally talk about this as well. I have a lot of topics I want to rant about. Meritocracy is one, but let’s first stick to maybe these talking points that I already outlined. I mean, does it make sense what I’m trying to say? All of this, yeah.
Stephan Livera (13:20.975)
Yeah, I’ve got you. So like, mean, my mental picture and many people might have seen there’s like a famous XKCD meme of like these building blocks. I’m sure you know the one I’m talking about where there’s like all these building blocks and they’re like profitable companies at the top. And at the end, this is one little small block that’s being maintained by some random developer in Alabama or something like that. And he’s doing it out of his own just, you know, cause he’s a hobbyist or he loves it or whatever. And
people don’t realize how much of the web and how much of the modern, you know, technological world is sort of like that, that there are projects like this that are just being maintained for open source, but actually they may not necessarily be getting that much monetary funding because maybe the money is being made somewhere else in the stack per se.
Pavlenex (14:07.98)
Yes, so that’s, think, one of the talking points everybody knows about. It’s pretty obvious. People say our company depends on this. We should support it. And what I wanted to clarify there is that the…
companies are already paying for open source. So they just often pay late. You pay through outages, workarounds, breaking changes in your own software. So you do pay eventually for…
for the open source one way or another, whether it’s like to supporting project and being informed on the changes and the direction and you are aligned with like strategic decisions that project is making, or you will pay later in hours and hours of engineering time of your own employees having to go through breaking changes basically or patch vulnerability they were not aware of and things like that.
Main, I think, argument there is that majority of these businesses depend on the open source software and often there are, well, decisions and things happening outside of their line of sight, right? You notice things only when they break, basically. And by the time you discover it, it’s already probably too late and you have to spend a lot of resources to patch those things.
by being more strategically connected to these projects you depend on.
Pavlenex (15:35.534)
you will get earlier visibility on the changes. Developers may even reach out to you because they are aware of you, you’re supporting the project. And it’s not just from financial perspective, they will support you as a power users project is incentivized to notify users on these changes and consult with them before they make such a change, for example. yeah, basically supporting contributors is one way to close that gap of not having visibility.
of what’s going on on the project.
Stephan Livera (16:07.718)
Yeah, I’m also, think another obviously big thing nowadays, massive is AI, right? And there was a famous example, I’m sure you might be familiar with it. I think it was Tailwind CSS. Did you hear about this example? Where basically they, I think what happened is they ended up laying off a bunch of their engineering team. Now this is a company, but I guess the point is more like the advent of AI had sort of taken away parts of their business model such that they couldn’t.
like have the same level of engineering talent. I’m curious if you’re seeing any of this in open source world, like the impacts of AI in terms of like, I guess there’s a few. So one I’ve heard is like you’re seeing a lot of this kind of AI drive-by contribution, like slop contributions, and then that’s like a thing of like the contribute, the maintainers have to sort of deal with that. And then I guess that’s one aspect of it. Any comment you wanna make on those?
Pavlenex (17:03.522)
Right, so it’s interesting. It’s AI and how it impacts open source.
a whole other topic we can discuss, but I’m sure you also recently saw open source projects, projects close sourcing themselves like cal.com saying that, you know, with AI tooling, it’s now way easier to find security vulnerabilities because if a software is open, you can find security vulnerabilities and exploit it. You know, I’m not really, that argument for me doesn’t make any sense, but I’m sure they had other strategic decisions on why they went that direction.
Stephan Livera (17:30.693)
Yeah.
Pavlenex (17:38.51)
In terms of contributions, it’s pretty exciting. In the past, we always struggled with getting contributions and people to contribute. Now we are like, oh man, there is so many PRs and all of them are AI driven, which is great. Like people are starting to learn how to contribute. It is definitely adding burden to maintainers, but what we can do is we can have our own agents trying to be a gatekeeper in a way. Yes, just help with…
Stephan Livera (18:02.821)
to help you with the workload.
Pavlenex (18:06.338)
basic things like test your own things or, you know, make sure to address these comments by AI before actual human can take a look at your. But I’ve never been more excited. I’ve met so many new people these days, like that I’ve never even did or not even Bitcoiners. Like we have people that don’t know what I’m sure they don’t know what mining is, but they’re helping us improve Strathum V2 website, for example, and things like that. So and then through that, they become interested. They’re like, I’m a contributor now. Wait, I need to learn a little bit about these projects, what it is.
start asking questions. So open source is a great filter, I think, for talent these days, and it provides visibility of high agency people basically as well. And I guess that’s it.
Stephan Livera (18:36.528)
Yeah.
Yeah.
Stephan Livera (18:48.569)
Interesting. Yeah, so in a way, it lowers the bar.
for people being able to become contributors, whereas previously maybe they weren’t able to or not willing to and I guess, yeah, but as you said, the hurdle still is on having, let’s say, personal agency, like being willing to go out there and actually do something. Anyway, I’ve sidetracked you a little bit. Let’s get back to our main arguments around, so you said you’ve got, so think on your article you’ve got four talking points and listeners it’ll be in the show notes, of course. So do you wanna just talk us through some of those? So the first one there is,
Pavlenex (19:19.693)
Yeah.
Stephan Livera (19:20.915)
decisions downstream impact.
Pavlenex (19:23.606)
Yeah, so we covered that one pretty much. think we kind of can talk a little bit about this talent pipeline. Like first one, everybody knows about it. You depend on open source software. You should support it because it’s great and it helps your company build and make money.
I think this second one is something that I’ve been tinkering for a while now because for a very long time, yeah, yeah. So for quite a while I was just thinking like, yeah, why would people support us? Like we will just help them do their business. But actually if done smart way companies can benefit from…
Stephan Livera (19:44.369)
All right, so the talent pipeline, yeah?
Pavlenex (20:01.034)
supporting open source software and being closely involved with people in open source because it can help them get access to global talent. And why am I saying that? Well, corporations are currently limited in where they can hire, most of them. Like you cannot hire in every country. But what you can do is give grant to any person on the planet basically. And that’s how you can support talent. So…
Stephan Livera (20:22.929)
Got it.
Pavlenex (20:26.166)
And yeah, also open source for corporations gives a great signal on, you know, high agency people. Basically, it gives them a way to better look at the future hires through
maybe through contributions in open source. So like you can go to the GitHub and you can see like, wait, this guy is taking ownership. He ships, he reviews carefully, he engages with people. So everything is open. Like you can get a sense of who somebody is just by how they engage in the open source community. And I think it’s way better signal for hiring than a resume because everybody can write anything, but this is like you can,
by example, go to GitHub and see who somebody is basically, how they work in a team or alone and how they solve problems. And I think this openness really helps get high quality, signal employees. Basically, open source makes all of these people more visible in a way that maybe traditional hiring or resumes never would. Because you know,
Stephan Livera (21:37.498)
I see. So let’s put that in company terms. In a way, your search costs to find your to hire new employees might be lower because of because of the work that you’ve done on the open source side of it. So maybe that’s like one angle of like you can offset some other costs that you would have otherwise paid just like what you were saying with you pay for the open source either in the outages and dealing with that or upfront paying for the maintenance and the support development work.
Pavlenex (22:04.427)
Yeah, and like…
Stephan Livera (22:04.719)
Yeah, so that’s the talent side. And then you mentioned the of the regulatory aspect of maybe it’s easy in certain cases, I guess you’re saying it’s easier in certain cases to provide a grant than it would be to actually hire that person full all the way. And then that’s a way of kind of having them at a not fully arm’s length, but like somewhat in the middle before you take them on fully as an actual in-house employee.
Pavlenex (22:17.207)
Yes, exactly.
Pavlenex (22:28.554)
Exactly, exactly. If you even want to, like maybe that person doesn’t want, that doesn’t mean that every open source contributor should start working at a corporation, but maybe you know that there are people that through open source, even though they are very valuable and provide incredible amount of like value, at certain stage they just feel that they can no longer…
work in that chaos. They need peace, they need more structure, and this is where I usually suggest them to go find a job in like a company. Because if that’s what you need, more structure, more instructions, you’re not that self-driven, getting a job at a company maybe is a better idea for you than trying to, you know, constantly swim in this chaos of open source. So…
Stephan Livera (23:15.151)
Yeah, okay, gotcha.
Pavlenex (23:15.328)
I think people in open source are, know, mission aligned. They push themselves more in public. They are more ethos driven as well. So this is what companies that look that need that type of people can get them in open source easily. And through grants or through donations, you have relationship built with these people. You have trust built. So, you know,
What I’ve seen is a lot of, you know, grantees of certain entities later after like several years, they start and they take a job at this organization that originally provided entity, provided a grant, sorry. And the reason why they did it is because they simply enjoyed working with people or having conversations or having, you know, back and forth with people from organization. Exactly, exactly. Yeah, exactly, exactly.
Stephan Livera (23:57.991)
Hey, everyone wants to belong. People want to be part of something, so…
Yeah, okay. So let’s go to the next one. You’ve got complement to R &D.
Pavlenex (24:08.139)
Yeah, this one is very interesting and this is something that I don’t think anybody has maybe thought a lot about it. But what I wanted to argue there is that…
Free and open source funding can extend your R &D. So if you’re a company, you may consider throwing or setting a budget for free and open source and give grants and through that you can get access same way you would through R &D. By funding a small number of independent open source contributors, you can have access to very wide area of people or like wide technical area, which you probably wouldn’t get with just hiring one engineer.
So what I’m trying to say there is like you can have, I don’t know, $50,000 per annual grant to somebody and…
you can give it to multiple contributors and you can try from their work as well. You can give them money to experiment with the ideas that maybe your company is not prioritizing, maybe they don’t see value yet, maybe it’s costly because hiring five full-time engineers to do a prototype on an idea or to ED8 takes…
just takes more time. So what I’m arguing there is not that open source replaces internal R &D, but it like extends it. It gives you just another way for your company to basically get access to innovation.
Stephan Livera (25:35.772)
Got it, so you can think of it like maybe a low cost or lower investment ways of dipping your toe in a certain area without having a full in-house R &D team on that particular research or development question.
Pavlenex (25:46.092)
Yeah, yeah. Because, you know, yeah, a company may not have capacity to work on protocol engineering, research and all these other stuff. But if you’re, you know, supporting these people that do work there, you can get ideas and you can get some prototypes that they build that they maybe don’t have interest resources to push on. So I was arguing there that, yeah.
by supporting free and open source, are in a way extending R &D ecosystem. And actually this pitch went pretty well with a lot of corporations. They didn’t really see it as that.
But if you think about it, it really can be like you can set a small budget and just support people to experiment or you can maybe your company cannot focus on certain like problems to solve, but you can give small grants and allow people and in open source to try to solve those problems and then you can support them further or you know, maybe your company will end up adopting the product that they built on.
Stephan Livera (26:50.258)
Okay, number four, small operational and legal overhead.
Pavlenex (26:55.586)
Yeah, so there, what I noticed is that giving a grant is pretty easy. So it doesn’t require a huge bureaucratical overhead because.
You just can sponsor somebody and it’s pretty easy. Like there are already open source. I think Spiral, HRF, OpenSATS, all of these entities actually would help companies with their own internal documents so they can share templates on how they provide grants. And they’ve been, I for sure know that Spiral has shared with several entities that I tried to help.
Stephan Livera (27:20.496)
templates and things. Yeah.
Pavlenex (27:27.85)
adopt open source spiral was always happy to share these documents and I’m sure other entities would. it’s a very, one more thing like grant is a time bound. There is no like this HRF, sorry, HR, HRF. was meant to say HRF also supports, yeah, HR doesn’t really, it’s not involved in this process. like bureaucracy there is reduced. So.
It’s not a huge operational burden for a company to do this. And it doesn’t cost them much, but the benefits of it overall can be pretty big.
Stephan Livera (28:06.322)
Yeah, gotcha. Okay, yeah. And that’s, guess we kind of covered some of that in the earlier points as well, a little bit about lower cost or lower investment ways of getting things. Now, another point is around this notion of corporate funding and corporate control. Right now, obviously, we’re in Bitcoin, that’s kind of a that can be a contentious point, depending on what you’re talking about. Like if it’s, you know, you know, people talking about
influence on the protocol and things like that versus, well, developers still have to eat too. So how do you balance that? How do you assess that?
Pavlenex (28:41.45)
Yeah, so I think the best way to kill an open source project is to undermine the meritocracy that powers it. And in Bitcoin, we are already seeing this happening on certain projects, right? You found one person, you found one project that is closely related to this, and then all of these like pyramid of meritocracy starts crashing. So what…
I personally am advocating there is that all of these things can be solved if more entities acted in their own self-interest, selfish interest basically. So more corporate participation does not mean that the corporations have more control. It means that we now have more.
corporations, so it’s like not concentrations of these entities that support the project. So I know that like a lot of my open source friends may now listen to this podcast and maybe they will say, Bob is arguing that corporations need to take control of free and open source. Somebody may end up with this idea that we are now debating here that corporations should, in a way, take over and there is like all of these benefits for them. But actually it’s quite opposite.
we are trying to do here is set a case on why companies should support. The more companies support, the harder it is to centralize funding, the harder it is to gain control of the project if you have multiple entities. What we have in Bitcoin right now is concentrated funding and it’s something that we need to solve long term as well. And that’s why we need to help other…
Entities understand the value of funding open source if we want more companies to act in a self interest. Maybe I’ve been working with miners for too long that I now look at things through this lens, but I do feel like if we are able to speak their own language, we will be able to have them understand that there is a lot of value that a company can get from supporting an open source.
Stephan Livera (30:42.439)
Gotcha. So I guess the other questions will be sort of what about the pitfalls of maybe funding the wrong thing, funding the wrong project, the wrong person or wasting money because you structured it wrong. What are some of the ways that a company can do this the right way and avoid those pitfalls?
Pavlenex (31:00.886)
Yeah. So I think the best way is just
So if you’re considering like who you should support, always reach out to the people on that project and learn like who they feel should provide value to the project the most and maybe is not funded or needs help. That’s one way to do it. So there is always some research you as an entity need to do and certain take certain steps in order to do it properly. Because I don’t think anybody would like to provide funding for somebody not to do anything or do poor job or just do something that can undermine
the ethos and the structure of an open source project. And it happens. Like we are all humans, we make mistakes. I think there are definitely examples maybe of wrong people being funded or maybe those people that were funded didn’t really understand how things work in open source. So it’s critical that meritocracy is the pillar there when giving a funding.
Otherwise we will end up in situations that can cause chaos on open source project. And that’s why I think it’s important to have diversity in funding more completely unrelated entities trying and even acting in like very selfish ways to get to provide funding because it benefits them. And this is how the network becomes resilient. More economically rational actors versus a single philanthropist that thinks
you know, open source should try and provide support for it. And that’s literally what, why I wrote this is like to motivate companies to see the value and not for corporations to take control.
Stephan Livera (32:39.004)
Okay.
And so inside the company, who is typically the best person to manage this process, monitor this process in your experience, like you’ve been in this ecosystem now for years, who is normally the best person in the company to manage that kind of thing? Like to have the right expertise, but also the right level of maybe budget to be able to fund this kind of thing. How should it be managed?
Pavlenex (33:04.844)
Yeah, usually a person who likes open source understands open source and its values is usually a very good candidate for this. And somebody who doesn’t mind doing operational things, who doesn’t mind doing like talking to a bunch of people, doing a lot of research, trying to get the good understanding of
Because like, I don’t expect companies to have when they give grants, it’s very hard to expect that all of these companies will have technical understanding or like, to be able to, to evaluate certain applications. Right. So what you need to do there instead of trying to maybe just give a grant because like better not give it, then give it just for the sake of giving it. That’s also something that I think is very unpopular opinion maybe, but that’s what I always try to do is like motivate.
people to really understand like first when you are writing a grant you really need to understand key areas where you can help and like value you can provide and then
entity reviewing it should reach out to all of your colleagues, should review your work prior to giving a grant. And this is maybe that that part can be a bottleneck, but I don’t think it’s a huge amount of time because you can just ask people and you the more people you’re connected to, the easier you have access to information to learn if somebody doing work is the right candidate.
Stephan Livera (34:25.521)
Yeah. But I mean, typically, who will it be? Will it be like somebody in? Will it be like an engineering manager inside the company who is kind of managing this? Is it a CTO? Is it a, you know, CEO? Like who’s normally
Pavlenex (34:39.182)
I don’t think CTOs would enjoy doing this kind of work. Maybe they can help with evaluating the application. But yeah, as you said, maybe somebody as a PM, engineering manager, somebody who also cares about open source and understand it is usually very good high quality candidate to do this type of work.
Stephan Livera (34:56.221)
that they would be like a typical person inside these large companies who is, let’s say, interfacing with the open source aspect of it. Because as we were talking about before, there is maybe also an element of maybe some of these companies they want to, but they just don’t know who’s the right person to fund or they’re not close enough to sort of know who’s good. But as you said, part of the answer there is to look at some of these open source projects and ask the people who already working on them or maintainers there who is good, who is actually doing useful things. The other question, I guess that might be interesting,
is just like tied grants versus open grants, which is the right tool for the job? When should they be used? Like should the companies be thinking, no, I’m gonna fund Pavlonex for six months or for one year to do X, Y, and Z, and he has to achieve X, and Z, or no, it’s just an open grant. I’m funding Pavlonex to just kind of work on Stroud and V2 generally or whatever.
Pavlenex (35:49.31)
Yeah, that’s a very good and tricky question and I’m not sure I will have the answer completely. What I personally believe is that companies should have good understanding of like what areas they benefit from. So like in their selfish interest, they want to these areas of, we can talk about Bitcoin for example, I want to see more privacy or I want to see, you know, better scaling solutions or whatnot. I want to see more layers. I want to see Bitcoin being used as a payments.
because it benefits my business. So they usually have like these areas that they like to fund. So I think entities shouldn’t really direct people on like what should be done.
But they should fund people who have good and clear understanding on how they can contribute to certain areas. self-driven, self-motivated people who already understood pretty well how their work can provide value in open source. Of course, think maybe corporations can engage and check with the grantee, for example, on how the progress is going and stuff like that. But I don’t think they have capacity, or in most cases, even the knowledge to understand
like specifically how certain work impacts certain areas. So they also need to have a little bit of trust in this person. Entities that I worked with in Bitcoin and all of the contributors that I helped.
get funding or help them structure their grants basically. Yeah, I don’t think any of the entity, I really don’t recall a single conversation where entity reached out and tried to direct in a way to open source contributor to do something. I think it can be pretty counterproductive. So if they can keep it a little bit more open, I think that’s better way to approach. I guess that’s what you meant, right?
Stephan Livera (37:45.684)
Yeah, yeah, and I mean, because it’s kind of a genuine like
Because there is a tension there, because on one side, a company feels like they don’t want to just find people to just sit around and do nothing or do useless things. But at the same time, and the people, recipients of grants may also not want to be too tightly constricted, right? Even if they’re genuine, they’re not like trying to just be lazy and get money for nothing. They might just feel too constricted by that or maybe not as motivated. So I guess it is, there is a bit of a genuine tension there, but obviously people find a way, they manage it.
through some form of structuring of the agreement. Yeah.
Pavlenex (38:21.67)
Yeah. Well, personally, I’ve never met a contributor in open source who is not productive or doesn’t work on, like, I’m sure there are examples. There are always like rotten apples that we can, you know, maybe point out too, but like, I’m trying to remember, but I can’t remember like, there is a person who is like,
Stephan Livera (38:40.657)
Yeah, but maybe it’s like a selection bias, you know, the only ones you know would be the good ones, you know what mean? So… But anyway, yeah.
Pavlenex (38:45.102)
Could be. I try to work with very highly productive people, that’s true. But yeah, because your work is in public, like anybody can inspect your quality of work and like I think it gives pressure. What I saw is actually pretty the opposite. I saw contributors having so much pressure from having funding that they start…
Stephan Livera (39:07.291)
Right, like they’re over delivering or they’re really trying to work really hard to make sure, yeah.
Pavlenex (39:09.608)
Yeah, they like have a need to like over deliver and provide like more value, which is probably always great, but sometimes can also likely be counterproductive as well.
Stephan Livera (39:22.087)
Gotcha. Okay, so I guess kind of closing thoughts on this topic, FOSS support programs, supporting open source infrastructure. What’s your sort of summary of the main points there?
Pavlenex (39:39.148)
Yeah, so the summary is that you should, if you’re a company that in any way depends on open source software.
Even if you’re a small one, like I think maybe we framed this conversation too much as like corporate entities. What I actually meant is like you can even set the 5K annual budget and just give donations to the projects, try to build relationships, try to like there is a bunch of companies doing that. So it doesn’t mean that you need to have like hundreds of thousands of dollars in budget to do this. Like I think with even small budgets, you can make impact and you can start small and then maybe grow from there and see if…
Open source provides value and maybe the talking points that Pavleniks gave on Stephanie Levera podcast that motivated you to do this are bullshit and they don’t work and then you’re like, no, this doesn’t work. But if you’re a business that depends on open source, supporting open source, it’s not a charity. It maintains infrastructure you rely on. It provides access to people worldwide. It helps you get a better hiring pipeline.
It helps you get access to talent. It helps you innovate because you will earlier see…
decisions and you will earlier have visibility into changes on like certain protocol and you will always get this excited open source people telling you about the latest things that showed up. I think all of us working with open source are pretty enthusiastic and work on bleeding edge. So like you will get access to people who work freely, who collaborate with multiple entities, multiple companies. think when you work in a company competition is high, so you don’t really get to engage with that many people. You’re usually, you know,
Pavlenex (41:21.04)
in a way, you know, put in a group and this is where you work. But in open source, if I need something, I don’t know, from Blue Wallet, I’m gonna go and ask them and go to their support group and learn a bunch of things and I’m gonna go to this other project and like we engage with each other even like you will see like companies are more open to talk to open source than they are to their competitors. And this is where innovation can happen. Like open source people get
this access to all of these crazy bleeding edge ideas that are happening. And I think that can be very, very valuable for you as a company to just be up to speed with what is happening.
Stephan Livera (42:01.501)
Got it, yeah, makes a lot of sense to me. And I guess we’ve got to also while we’ve got you here, we’ve got to get some updates from you on SV2 and BTC pay. So let’s start with Strata V2. Any updates you want to share for people?
Pavlenex (42:16.588)
Yeah, so Stratov2, we shipped several major releases recently. We shipped the first time for years. We now have a UI. So we shipped something that we call SV2UI, which is a front-end application that…
puts together a bunch of complexities and just allows miners to have this very nice looking monitoring dashboard. While in the behind the scenes, we have something that connects to their own node to construct templates. We have something that allows them to run stratum v1 legacy firmware basically and connect to stratum v2 pool. So all of these complexities are abstracted from them. Main point there is that we are now at a stage of adoption. We are connected with several
major pools, smaller pools, bigger pools. We are seeing people putting SV2 on hardware, on a firmware as well. So we are seeing a lot of progress and I think we are at that stage when it’s a snowball effect. So I think things are going to start rolling out for Stratham V2 as an independent protocol for public good for entire industry to adopt. And I know I read a lot of, I read all the Stratham V2 comments, by the way, even the haters.
So recently somebody compared it with COVID. So like COVID was bad. So expert told me that COVID is good and people are telling me Stratov2 is good. So like people somehow managed to put these two together and say Stratov2 is bad.
why it is taking so much time to adopt is something that I really want to address now because working on a protocol that has a lot of entities that are in a highly competitive environment takes a lot of time to build credibility, to put all these people together to learn about actual problems in mining that we need to address versus
Pavlenex (44:08.908)
theoretical engineering problems that we might have thought five years ago we wanted to address. So all of these things take time. Things move a little bit slower, but I think we are doing them properly. Stratovitu now is a public good. There are multiple entities first and foremost funding it. None of them are miners. By the way, all of the contributors are funded by different entities, which is something that we really wanted to make sure that all of us are funded by different entities.
very important when we speak with the mining community. And then, yeah, UX is now easier, I guess, and that will be another step towards adoption. So I’ve never been more bullish, to be honest. We are finally seeing these technical things that we’ve been working on in the behind the scenes. Finally, there are users interacting, playing around. And now we finally have these early adopters that provide us crucial feedback.
And all these people, honestly, working on Stratham V2, a phenomenal team, really, really high agency, very hardworking guys has been working on all of this for years. So if you’re a miner, go to stratamprotocol.org, just click start mining and you can already start using Stratham V2. And we are hoping very soon we get more entities to deploy it on the pool level, hardware level, and that Stratham V2 becomes the protocol it was meant to be for entire industry as a public good to adopt.
Stephan Livera (45:36.124)
I see, yeah, and as I understand, is Demand Pool, they’re the main, like, one who is already doing fully SV2. Who else is, like, who else is at least publicly talking about it or doing something with SV2?
Pavlenex (45:50.476)
Yeah, one thing I always cannot speak about because it’s a highly competitive industries. We as an open source community are in a way this interoperability layer between multiple companies. So yes, yes, because it’s a highly competitive industry, but I hope very soon we will see progress on that. And I would say we already have
Stephan Livera (46:00.533)
Right, so there are people talking to you, but they’re not willing to be public yet, basically.
Stephan Livera (46:12.478)
Gotcha. Yeah, yeah.
Well, yeah, I mean, as you said, it’s been years and years and years everyone’s been talking about SV2 and it’s good to see some of it finally landing. Let’s switch now to BTC Pay. Let’s get some updates from you there. BTC Pay server, obviously, long time, free and open source, payment processor. What are the big updates you’ve got there?
Pavlenex (46:36.43)
We are in the like few weeks away from shipping a major release which will give users a lot of UX improvements a little bit multi-seq we’ve been working hard on that end as well We’re working on the plugin ecosystem So what we did with BTC pay in a way was like we tried to push innovation through plugins so everybody wants to so a certain level or scale at an open source project you get
people wanting features. And if you really want that to scale, you need to say no to a lot of things. We, through plugins, try to say yes to everybody. So like, yeah, you can build it in a plugin and you can use it on your own without being bottleneck for all the other users and for the core project. So what we are seeing now is a lot of…
very talented developers building like telegram bots with BTCPay server so you can buy things from telegram without ever having to interact with like what you know as BTCPay server. We are seeing a bunch of companies building their own second layer solutions. We have Stripe integration now so merchants can accept payments with credit cards through BTCPay. And then there is a plugin that allows you to convert this and buy Bitcoin on Stripe. So there is a really insane amount of innovation happening with plugins.
and I’m so bullish for plugins on BTCPay. And I think the most important thing, all of this, we will speak about it in Prague on BTCPay Day. So you can go to day.btcpacerver.org and get your free spot to join us. And other contributors will speak way better about all these updates than I can.
Stephan Livera (48:14.416)
Excellent, yeah. look, one other thing, I think a lot of people still aren’t familiar with what Samrock protocol is. Do want to just give people an overview on that? Because I think maybe there’s a lot of people out there sleeping on that and they don’t actually understand that, even people in the industry, just because look, there’s so many things happening. So can you just explain for people what is the Samrock protocol? What does it mean for BTC pay? What can a typical user do with that now?
Pavlenex (48:37.782)
Samrock is such a fantastic UX improvement and I will try to give example like so BTC pace server was always made for you to Initially to add your public key
to the instance and then you can receive payments without ever having to give us, you know, not us, the server, the private key. Over the years, lightning started and all these other things and it became very difficult to maintain that level of security, right? Because then now we need hot wallets and like there is a bunch of wallets being made, different protocols. It’s very hard for user to understand how, which wallet to basically use with BTCPay server these days. And onboarding them is very difficult. So the
the problem that Rockstar Dev and team at Aqua, Samsung Mao and all these other engineers tried to solve is like, how can we allow users to receive payments through their own wallet while BTCPay server is just front-end?
A website where they, you we show an invoice, somebody scans it and that payment ends up directly in your wallet. So what they made is a protocol which allows you to scan a QR code on the BTCPay server side and you connect your Aqua right away. You connect all of the payment methods that Aqua has.
Liquid lightning and on chain are all three set up in a single click for the user and then end user can just sit back and see the payments Arriving at their own wallet and for them It’s powerful because you know when they had a walk when they have a wallet in their hand They feel like it’s theirs, right? So they don’t give control to anybody else and they’re like wait How can you guys make all this magic that I can now receive and I can use this money right away here? So yeah What we are
Pavlenex (50:24.772)
trying to solve long-term is like how to have more wallets have UX like this, where a user simply scans and connects and doesn’t have to tinker about keys on the server or anything else. So it’s more secure, it’s better UX for them and, Samrock definitely there is specifications so wallets can go and incorporate this protocol as well.
Stephan Livera (50:46.546)
Fantastic. Yeah, because I think it’s it’s a maybe under known or underappreciated. So think it’s really cool
Pavlenex (50:51.698)
It’s such an underappreciated feature, I agree.
Stephan Livera (50:54.032)
Yeah, so because like you can think of it as like you’re just kind of sharing your viewing key or watch watching only and then the BTC pay server instance is kind of in a way helping route those payments and then you can just be like everyday person on your phone with your aqua wallet or whatever and it can just the payments can just hit your wallet and then off you go. So I think that’s really useful. Maybe a lot of people maybe just aren’t familiar with that because to be fair, there’s so many things happening in Bitcoin. So yeah, thanks for sharing all the updates today.
Pavlenex (50:59.009)
Yeah.
Stephan Livera (51:23.926)
Pavlonex. Listeners go and check it out. I will put the link in the show notes and of course follow Pavlonex on X at Pavlonex. And yeah, thanks for joining me today.
Pavlenex (51:34.626)
Thanks Stephan, it was a pleasure as always.