Forbes interviews Blockstream founder: Satoshi Nakamoto's first collaborator reveals the future of Bitcoin

By Steven Ehrlich, Forbes

Compiled by: Luffy, Foresight News

Blockstream co-founder and CEO Dr. Adam Back is a British cryptographer and computer scientist best known for inventing Hashcash in 1997, which later became the basis for Bitcoin's proof-of-work system.

As CEO of Blockstream, Back plays a central role in developing infrastructure and scaling solutions that shape the future of Bitcoin finance. Blockstream’s major innovations include the Liquid Network, Bitcoin’s first sidechain designed to enable faster and more private transactions, as well as stablecoins andTokenSeamless issuance of digital assets such as real-world assets (RWA). BackCommunityHe is widely known because he interacted with anonymous Bitcoin creator Satoshi Nakamoto before he wrote his seminal white paper in 2008.

In this interview, we briefly touch on some of Back’s early work on Bitcoin, much of which relates to his work at Blockstream, which just completed a $210 million convertible bond offering and aims to create more functionality on top of Bitcoin.

Forbes: How did you first start working with Satoshi Nakamoto?

Adam Back: I was the first person to receive an email from Satoshi before Bitcoin was launched. The conversation was not very detailed. I believe that by then he had developed the Bitcoin software and the next thing he did was to write the white paper to describe how it worked. He asked about the correct way to reference Hashcash. Later in the conversation, he told me that he had published the white paper and asked if I would like to download the source code for Bitcoin. This was around January 2009.

Forbes: Do you think it’s important to find out who Satoshi Nakamoto is right now?

Back: I think this question is less and less important because Bitcoin has been around for many years and is a decentralized product. I think Bitcoin is more of a discovery because it is decentralized and has no CEO or founder, unlike some other projects. Humans discovered that physical gold is a good currency, and now we have discovered an even better currency: digital gold. We have experienced a lot of dramatic changes, such as the block size war, and the market ultimately prevailed, so even if Satoshi Nakamoto returns, it is no big deal. If you think about it, this is a pretty positive result, and the market is a manifestation of users' desire for electronic cash.

Forbes: Let's talk about Blockstream. Bitcoin's biggest use case right now is as a store of value. How do you reconcile that with the goal of making Bitcoin a widespread payment system?

Back: We have two options. We have one of the main implementations of Lightning, which is all about scalability and retail payments. Then we have Liquid, which is more focused on trustless transactions, smart contracts, and the like.contract, assets, stablecoins and securities. Although I have a computer science background, I was a fairly enthusiastic day trader and investor in the mid-90s and I was curious about the Bitcoin technology (Blockchain) can do to improve trading infrastructure.

Events like the Mt. Gox collapse taught us that we should have a technology that allows you to do atomic transactions in a non-custodial manner. In fact, everyone gives custody toexchange, which means you need to trust someone. Liquid is doing a lot of things, it is also used for stablecoins and retail payments. Now there is a new thing: cross-lightningwalletThere are three or four teams working on this right now. They look like lightning.wallet，但实际上，它们是 Liquid wallet，当你想要付款时，它们使用无需信任的交易将 Liquid 比特币换成 Lightning 上的比特币，反之亦然。

We built a block explorer for Liquid, and now there's an ecosystem around Liquid. A startup called SideSwap offers a trustless central order book where you can place limit orders. We also made our own hardware wallet to innovate faster. You can approve transactions directly on the hardware wallet. That's very innovative and very exciting because you're not giving up custody.

Regarding the question of value storage, people have been thinking about inflation since the COVID-19 pandemic. In the short term,cryptocurrencyIt feels a little unstable. But remember, about 50% of the world's working population is in the informal economy, they get paid in cash and don't have any government ID. These people don't have direct access to the global economic system. This is very interesting because although Bitcoin is very volatile, it's not as volatile as some of the emerging market currencies. So, we see the payment scenario of Bitcoin. Of course, some gray markets in the West also use Bitcoin, where industries may be legal but banks don't support them, such as marijuana sales in certain states and countries, etc. Bitcoin does have these uses.

Forbes: I know that the usage of Lightning and Liquid platforms is growing, but it is still a relatively small percentage in terms of Bitcoin transaction volume. What is your comment on this? What can be done to accelerate the adoption of these networks? In addition, I see the same interest in stablecoins as the emerging markets you mentioned. What are the pros and cons of Bitcoin and stablecoins when trying to reduce inflation risk?

Back: In some ways, stablecoins are very convenient, while Bitcoin is a bit volatile, which is a side effect of rapid adoption. For those who don't have a lot of savings and have to make retail payments every week, this can be a bit troublesome. Stablecoins are very popular and there are a few on Liquid, the main one is USDT, as well as new issuers launching stablecoins pegged to the Mexican peso, the euro, and the yen. The yen stablecoin is a bit special in that it is limited to over-the-counter trading with Bitcoin. So far, the market capitalization is not very large, about $35 million or so. But it's still early days for this type of wallet. We are working on some projects that may gain mass adoption and will promote retail payment use.

We've seen other types of bonds issued on Liquid. One of them was a $1.5 billion promissory note issued by Mifiel. Several large U.S. public companies funded the promissory note. The promissory note was then a small business loan issued to Mexico. There were hundreds of loans, ranging from about $25,000 to $100,000 per company or individual. These activities used to be recorded on paper, which was prone to errors. With this new source of funding, they have been using Liquid to track debt instruments, which are resaleable. When a lender issues a loan, they get a DocuSign, and when it's linked to the borrower, they get a DocuSign, and the issuer gets a transferable certificate of the loan so they can resell it to other lenders.

Forbes: Let’s talk about your recent fundraising. Do you think it’s easier for a Bitcoin-centric company to raise money from investors than toTokenWhat are the differences between companies issuing financing?

Back: I think the market has shifted. A venture capital firm called Trammell Venture Partners released an annual report looking at crypto market investments and otherBlockchain相关的比特币资金分配情况。由于Token化现象，风险投资公司过去严重偏向其他网络，他们不必制造出符合市场需求的成功产品，只要有流动性，他们就可以出售代币。但这种情况在去年发生了一些转变。

I also think the altcoin market is saturated. There used to be 20,000 altcoins, but now there are over 3 million, including memecoin. Another phenomenon I see is the growing interest in Bitcoin Layer 2. We are the oldest and largest company in this field. We also provide hardware and software wallets for consumers, and do R&D work on privacy technology, etc.

It's a good time for us to expand into that. There's also a way to handle securities on Liquid in a properly licensed way. There are a few different companies doing this, one of which is Stockr, which is a securitized fund manager based in Luxembourg. We did something similar in 2021. One was a Bitcoin mining note. We had a mining farm, and at the time, we hosted a lot of large corporate miners, like Fidelity's, and we got a lot of retail interest. There's even MicroStrategy (MSTR) stock on Liquid now. You can trade it, and it has some interesting advantages over trading it on Interactive Brokers. For example, it can be traded 24/7.

Another novel thing about our round is that a large portion of the money that the lead investor paid was actually in Bitcoin, which we will keep. We did this back in our 2021 seed round, when we raised $21 million. In a way, we are the original MicroStrategy because we have Bitcoin on our balance sheet. Of course, many Bitcoin startups now do some of this, but we have been around longer than most companies, since 2014.

Forbes: What is the biggest risk facing Bitcoin or Blockstream?

Back: I think a lot of the initial risks of Bitcoin have subsided. The focus we had initially was on whether a major country or economic zone, like Europe, China or the United States, would ban Bitcoin, which was very uncertain. That created a lot of perceived regulatory risk. But I think Bitcoin is now well-guided. Now, ETFs mean that the financial institutions that issue these products are interested in expanding these products and keeping them in the market. So I think the bank or financial institution lobby now wants to do that. And you have other allies, some sovereign wealth funds and countries that bought Bitcoin or Bitcoin-related products and instruments at an early stage. So I think a lot of the risks have subsided. In addition, a lot of the technical risks have also subsided. Of course,BlockchainScaling is still challenging, and there is still room for innovation and improvement in how to do this. The Lightning Network is very reliable for point-of-sale and person-to-person payments, but there is still room for improvement.

The article comes from the Internet:Forbes interviews BlockXiaobai NavigationStream founder: Satoshi Nakamoto's first collaborator reveals the future of Bitcoin

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