Early in June, Pieter Wulle, one of the core developers working on Bitcoin visited the Bitcoin meetup in Switzerland. After the meetup I caught up with both Pieter and Stefan Thomas, the creator of WeUseCoins and BitcoinJS. Below they share - while mildly inebriated - their wisdom, thoughts, and fears about Bitcoin.
Jon: Let’s start with the easy questions! Pieter, where are you from? What’s your background?
Pieter: I am Pieter Wuille, I’m from Belgium, I studied computer science. How did I start into computers? When I was like 5 years old. I must have been talking to my dad at the time and I said something like “daddy numbers are pretty cool, you can do things like adding them together. You can’t do that with letters.”. Then he wrote a small program that concatenated two characters strings and printed them out. I guess a few years later I started writing my own programs around age ten or eleven, in GW-BASIC. Then QBasic and Visual basic followed. At around age 16 I started writing in C. Later at the university I also learned learned Java and a few other languages. Eventually I also did a PhD there, though I was glad when that was over.
Stefan: Gotta love Pieter’s modesty! He learned some java, got a PhD - you know, nothing special!
Pieter: I heard about Bitcoin in an IRC channel about Haskell. Apparently my graphics card was good enough to do mining at the time. After a few months, I was trying to get Bitcoin to import private keys and export private keys and play around with it. I wrote a patch for that. I encountered some problems so I emailed Gavin Andresen about it. I offered some improvements, and Gavin asked me if I was interested in joining the Dev Team.
Stefan: How was the process of joining the Dev Team?
Pieter: I got an email from Gavin asking hey, are you interested. And uh, he gave me write access to the repository.
Stefan: Did you ever considered changing the client to send all the Bitcoins to you?
Pieter: No… well. Yes.
Stefan: That’s why I can never join the dev team, because that’s the first thing I’d do. (I’m kidding!)
Jon: Do you plan on continuing to be involved in Bitcoin?
Pieter: For now, sure. Will depend of course on how much time I find in the future. For now it’s not a problem. But it might change.
Pieter: I’ve been involved since the middle of December, 2010.
Stefan: You’re such a noob, I first used Bitcoin in June of 2010! Then again, guys like Mike [Hearn, creator of Bitcoin’s Java implementation] already used it back in ‘09. So I guess we’re both noobs.
Pieter: I think your work is not known well enough! BitcoinJS is just not well known.
Stefan: I’m actually okay with it not being well known. It’s still pretty young, so it’s good to have some time where I can fix bugs, rewrite stuff and generally let it mature while it isn’t used too widely.
Stefan: The original client is used to handle quite a lot of money. How is it to work on something that sensitive?
Pieter: At times when I realize that a patch does the exact opposite of what it’s supposed to do, I feel responsible and try and fix it right away. On the other hand, we are a team of several people, no one is going to point to one person and say, you broke this, take the blame. Eventually, Gavin has the largest say in what gets merged.
Stefan: Just like other projects stand on the shoulders of giants, we stand on the shoulders of Gavin.
Pieter: I don’t think Gavin wants to be Mr. Bitcoin, he was just chosen.
Stefan: I think there is a good interplay between Gavin and the other developers. Everyone keeps trying to push responsibilities onto him, but he does a great job at including them in the decision making process anyway.
Jon: You are both deeply involved in Bitcoin’s development. What do you think are the most pressing issues that need to be solved?
Pieter: Most pressing issues…
Stefan: Nothing. It’s done.
[They both laugh]
Pieter: I think it depends on what timescale you’re looking at. If the goal you’re trying to reach is that your grandma can use bitcoin from her smart phone, I think that requires not much development of the client, but infrastructure being built around the Bitcoin protocol. Where you have payment processors and all the things peoples are able to do with money right now, which they should be able to do with Bitcoin much easier. We really need services that are useful for paying, instead of gambling, exchanging and betting against currencies.
Stefan: A lot of people know of Multibit, which doesn’t download the blockchain upfront. Will that concept ever be applied to the Bitcoin client?
Pieter: One of our main plans is to have our client start up in headers-only mode and then gradually download the blockchain in the background and then at some point turn that mode off and become fully synchronized. This will be ready in a few months maybe. Matt has already implemented this halfway. This is a most substantial change.
Jon: Are there any huge threats to Bitcoin that people should be concerned about?
Stefan: Other than Pieter?
Pieter: Oh yeah, no. I shouldn’t be talking about this one. No don’t write that down… I think, probably scaling issues… Not scaling in the sense of getting too big, but if things get unwieldy big before more legitimate users appear… If there were a very sudden growth of a particular side.
Stefan: I have something I’m scared about: A couple of months ago people were able to exploit some weakness with public keys on Github. We’ve seen hacks on Linode, we’ve seen a hack on Github, what if there was a hack on SourceForge*?
*The downloads for the Bitcoin client are currently hosted on SourceForge.
Pieter: Yes, that’s a problem. But there is an advantage hidden inside a disadvantage. The amount of people who upgrade their clients when there is a new update is frighteningly small. It’s nothing critical, nothing to worry about, just the fact that people are not upgrading that quickly, I guess if someone hacked into SourceForge and put fake binaries up, it wouldn’t be signed by Gavin’s key, it’d be noticed very quickly. But yes, there’s certain infrastructure that we need to trust until there are alternatives.
Pieter: People need to remember that Bitcoin is still an experiment.
Stefan: It’s easy to forget that we’re still on version number 0. When will version one come along?
Pieter: As Gavin has stated, “when my grandmother is ready to use it.” I think we’re getting close, the multisignature needs to be there, the blockchain shouldn’t be getting corrupted, these are the kind of bugs we don’t want to have. But we’re slowly getting there. There has been an increase in the number of patches. So development is getting faster.
Jon: Stefan, since you run WeUseCoins, you’ve probably helped tens of thousands of Bitcoin newbies, what type of marketing do you think needs to be done to push Bitcoin into the mainstream? Do you think it’s even ready for average consumer?
Stefan: Well, as Pieter just said, we’re still a ways away from what could be considered a 1.0 version release. At WeUseCoins, we found our audience. There are now significantly more Bitcoin users than there were a year ago. But most of them are geeks, so I’m not looking at mainstream marketing, but at what other niches could use Bitcoin.
Pieter: I think if Bitcoin was to survive, it should focus not on replacing worldwide currencies, but on small niches.
Stefan: Take for example, GirlsGoneBitcoin (NSFW). Which is basically a place where girls can strip for bitcoins. I think niches like that, as awkward as it sounds, are what we need to be looking for. Use cases for smart contracts, privacy, stuff like that. The mainstream is way off. The more established Bitcoin becomes in smaller niches, the better it will do. If you have a critical mass in some core markets, you can use those markets to expand. That’s how you capture the mainstream. From WeUseCoins we learned to avoid going after the mainstream directly.
Jon: What do you two think about Silkroad? Do you think it is the biggest driving force behind Bitcoin?
Pieter: I’d say it’s inevitable. I’d say Bitcoin offers relative privacy, but I don’t think it’s not only useful for them. There are other ways that Bitcoin can benefit other niches.
Stefan: When I say focus on niches, I’m talking about legal niches. Most drug deals are done in dollars, not in Bitcoin, because dollars offer unconditional anonymity. To the extent that people do use Bitcoin for illegal deals - we don’t condone it, we don’t promote it, we don’t want to help it in any way, but it’s going to happen.
Stefan: However, to say a technology shouldn’t be pursued because of some abuse, historically, has never been a good argument. Most technologies have some negative side-effect, but at scale it turns out to be less of an issue than people expected and eventually they stop talking about it. Cars, nuclear technology, etc. If we put a moratorium on anything that might have negative side effects, no substantial technological advances would be possible. We look for the positive stuff, the positive usage and with Bitcoin there are plenty of reasons to say it’s worth doing.
Pieter: Bitcoin enables certain uses that are very unique. I think it offers possibilities that no other currency allows. For example the ability to spend a coin that only occurs when two separate parties agree to spend the coin; with a third party that couldn’t run away with the coin itself.
Stefan: I found it interesting that this point is never picked up in the media. Assassination markets and that kind of stuff always gets a mention but never any mention of smart contracts.
Pieter: Never in all the interviews I gave did they ever write about it. It’s a pity. It’s still so early right now, even we don’t know what it’s going to be used for.
At this point the clock strikes midnight in Central European Standard Time and Stefan turns 25. Pleasantries are briefly exchanged, then Pieter continues:
Pieter: Smart Contracts… In its basic form… Contract is a wrong name. It’s a lower level than that. The idea that you have a coin, which more than a single person needs to give their approval for. One of the easiest things you could do with it, is have a bitcoin client on your desktop system, but to actually send money you’d need to get approval from your cellphone. This would add another level of security really. Since an attacker would need access to both devices.
Another usage is for large sites with automatic payouts. This could have helped against attacks that have occurred on websites on the past. You use two servers, where the second server would verify the transaction. The second server would request human approval for large transfers and would freeze the system until it got approval. This sort of security gets Bitcoin much closer to banks and other institutions that are handling money.
Another application is escrow. You could create a low-trust escrow service which decides if the money goes to the destination or goes back to the sender. This means the escrow can never run away with the money. It decreases the trust needed between parties and escrow services/
Stefan: Escrow is fairly expensive, because you have a small selection of trustworthy providers. With Bitcoin it could be essentially free, because when there is less trust you need to build up, the barrier to becoming a provider is dramatically lower.
Jon: What’s your favorite Bitcoin business?
Pieter: Clearly Alpaca socks.
Stefan: Haha, my heart says Alpaca socks, but the most useful or practical to me is probably premiumize.me. It’s a little service where for a small amount of bitcoin they let you proxy around country restrictions on sites like Pandora. They also give you the ability to download as a premium user from various cyberlockers..
Pieter: Oh, I didn’t know about that one.
Stefan: I’ll show it to you later. I quite like Bitcoin for that use case. One thing about Bitcoin that isn’t mentioned enough is that it’s good for plain old online payments. You press one button and it’s done.
Pieter: It’s good for transferring value across the internet. There is too little infrastructure to say Bitcoin can be used to make payments.
Stefan: I’m thinking about a few bitcoin businesses I want to mention. I went paragliding with Bitcoin awhile ago. I want to highlight that Bitcoin is a community… I don’t know about there being a PayPal community. Bitcoin has a trade page which I browsed and came across a paragliding business a couple of miles from my house. I would have never gone paragliding if I hadn’t found it through BItcoin. So there’s a community aspect to Bitcoin. There are so many liberty minded, geeky minded… how else would you meet all these people! We want to build more of these communities. We don’t want mainstream.
Pieter: I don’t want mainstream yet.
Stefan: There is so much growth potential in certain communities that are already heavily Internet-based, like the online gaming community. Think of esports tournaments, betting with Bitcoin, trade with virtual items and online matches, it might be a niche that could very well adopt bitcoin at some point.
Stefan: I also like the Bitcoin conferences. And they’re Bitcoin businesses technically. Bitmit is also awesome; it’s Bitcoin’s very own eBay. The thing with Bitmit though, is that there are not enough users, not enough offers. There is a massive network effect with auction sites. Paypal got big because they were used with eBay. We just need a niche like that. Auctions are already done reasonably well by eBay and PayPal, but maybe we’ll find our own niche at some point.
Stefan: Another site, Coindl is like iTunes basically, there is already some interesting content on there. I already bought one single and two albums so far. It’s great, I really want more artists to put their work on there!
Jon: Pieter, you work with Gavin quite closely I presume, do you think he’s a CIA spy? (There have been rumours!)
Stefan: I’ve heard he is actually a space lizard!
Pieter: Uhm, no. At the time he was invited to the CIA on the conference on money. They offered him some money for the conference, I like the fact he was so upfront about it posted on the forums.
Stefan: But that’s exactly what he would do if he *was* a spy!
Pieter: If you want me to be honest about this question, no. But I don’t know.
Jon: What are some common misconceptions people have about Bitcoin?
Pieter: Okay, I think, some core misconceptions, that money is created by computer cycles… That’s like saying gold is created by digging machines. I suppose there is a misconception as well that Bitcoin is only being used for illegal purposes. I sometime see people assume that it’s dead. The fact that people see news reports about hack sites and people think Bitcoin has a problem when in reality it is third party services that have the problems. I think it reflects poorly on Bitcoin itself and its growth pains.
Jon: Thank you both for your time and your insights!
That’s all for this week’s interview, if you have a suggestion for next week’s interview, let me know!
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