I'm Ben Davenport, co-founder & CTO of BitGo. Ask me anything!

[bpd]

Hi all!

I'm Ben Davenport, co-founder and CTO of BitGo. I discovered Bitcoin in 2011 by reading about it on a blog and rapidly got sucked down the rabbit hole. What got me excited was the creation of the world's first scarce digital commodity, designed specifically to be a better form of money than gold. Like most people, it took a good bit longer to really understand the ins and outs of the protocol -- every time I thought I understood it all, I found some new aspect I hadn't yet fully understood.

In 2012, I started what became SVBitcoin, a Bitcoin discussion group centered on Silicon Valley and also began actively angel investing in Bitcoin companies, later starting a Bitcoin syndicate on AngelList. In mid-2014, I joined BitGo as co-founder and CPO (now CTO). The core mission that brought me to BitGo was to help solve the fundamental security problems of the ecosystem, which had demonstrated with hack after hack that single points of failure are a bad idea. At BitGo, our multi-sig wallets are now powering many Bitcoin businesses, including the two leading western exchanges, Bitfinex and Bitstamp, and we have north of $1B per quarter running through our systems.

Prior to BitGo, I co-founded Beluga, which Facebook acquired, subsequently becoming Facebook Messenger. Previously in my career, I worked as an engineer at Microsoft and Google, as well as doing a stint of algorithmic trading on Wall Street.

AMA!

Ben

[rogerver]

Hi Ben,

Thank you so much for all your involvement in Bitcoin.

I'm glad you pointed it out, because many people may not of realized that in addition to being the CTO of BitGo, you are also one of the most active angel investors in the space.

1. What future developments in the Bitcoin space have you the most excited?
2. Other than BitGo, which startup is the most interesting to you?
3. How many more years do you see yourself working in the bitcoin industry full time?

Thanks so much for getting involved!

[Serona]

I am not a tech guy... but really interested in the online world. After travelling around the world as a media consultant .. I am no changing career and want to be involved in the bitcoin world... how to start in order to make a living with the online world of bitcoin?

[MartyBent]

Hi Ben,

Thanks for taking some time to participate in this AMA.

In your opinion, does Bitcoin have a "branding problem"? And if so, what do you think needs to be done to fix it/change perceptions.

Thanks!

[elijahkleinsimth.com]

Good morning, Ben!

Thanks for the AMA! I also found out about Bitcoin back in 2011 and I even set up a couple mining applications on some computers I owned. I lost access to those wallets, unfortunately. After that, I really have not done much other than read about it. All the while, you are a successful (perhaps the most successful) Bitcoin CTO. My background is in digital advertising, branding, marketing, pr, etc., and I am desperately trying to find my fit in the Bitcoin community. I, like Roger Ver, believe in its power to reduce government's ability to wage war – my primary driving interest in block chain technology.

My questions are:

• – With the current difficulty, is it worth even looking into mining anymore?
  – Is there a place for marketing professionals in the Bitcoin world yet? Or do I have to become a technology/block chain expert to consult with businesses properly? I am always looking to work really hard, learn a lot, and apply my knowledge and work toward a greater good, so I feel as though there is opportunity in Bitcoin, but I am just struggling to find my niché, I suppose.
  – What would you do if you were about to graduate college and have been hesitating to get into Bitcoin since 2011 despite its wild growth since then?

Thanks so much for your time!

Elijah

[bpd]

Thank you so much for all your involvement in Bitcoin.

I'm glad you pointed it out, because many people may not of realized that in addition to being the CTO of BitGo, you are also one of the most active angel investors in the space.

1. What future developments in the Bitcoin space have you the most excited?
2. Other than BitGo, which startup is the most interesting to you?
3. How many more years do you see yourself working in the bitcoin industry full time?

Thanks Roger, and thank YOU for all you have done for Bitcoin!

I'm most excited by improvements to the core protocol or additional layers which improve the basic scalability and functionality of Bitcoin. Things like sidechains, Lightning, and just core protocol improvements. I think, despite statements to the contrary, Bitcoin already has its first killer app, simply as a means of inflation-free savings and uncensorable value transfer. But we need to do lots of work to actually make that killer app usable by billions of people.

Pursuant to my prior answer, I'm really excited about the aggregation of strong technical talent at Blockstream. I think we've seen the beginning of some great stuff come out of there, and will continue to see more. On the applications side, I love what Abra is doing -- basically Uber for remittance.

I hope to work the rest of my career in Bitcoin, assuming there is a Bitcoin industry to work in!

Ben

[bpd]

I am not a tech guy... but really interested in the online world. After travelling around the world as a media consultant .. I am no changing career and want to be involved in the bitcoin world... how to start in order to make a living with the online world of bitcoin?

I'd say figure out what you're great at, whether involving Bitcoin or not, and pursue that, in exchange for Bitcoin. Or even in exchange for boring old dollars, which as of 2015 at least, are still exchangeable for bitcoins.

[bpd]

Hi Ben,

Thanks for taking some time to participate in this AMA.

In your opinion, does Bitcoin have a "branding problem"? And if so, what do you think needs to be done to fix it/change perceptions.

Thanks!

That's one way to look at it, I suppose. But another way to look at it is: it's really difficult to create a brand even half as valuable as what Bitcoin has already created today. The brand that turns some people off is what gets others so excited. Many fundamental new technologies often get early-adopters from "unsavory" businesses or individuals -- that doesn't generally doom the technology itself, and I don't believe it will for Bitcoin. No one ultimately really owns the brand for Bitcoin -- anyone who cares about Bitcoin can take a stab at some new marketing directions for it. But I think it'd be a mistake to dismiss the core brand equity that has already been built.

[bpd]

Good morning, Ben!

Thanks for the AMA! I also found out about Bitcoin back in 2011 and I even set up a couple mining applications on some computers I owned. I lost access to those wallets, unfortunately. After that, I really have not done much other than read about it. All the while, you are a successful (perhaps the most successful) Bitcoin CTO. My background is in digital advertising, branding, marketing, pr, etc., and I am desperately trying to find my fit in the Bitcoin community. I, like Roger Ver, believe in its power to reduce government's ability to wage war – my primary driving interest in block chain technology.

My questions are:

• – With the current difficulty, is it worth even looking into mining anymore?
  – Is there a place for marketing professionals in the Bitcoin world yet? Or do I have to become a technology/block chain expert to consult with businesses properly? I am always looking to work really hard, learn a lot, and apply my knowledge and work toward a greater good, so I feel as though there is opportunity in Bitcoin, but I am just struggling to find my niché, I suppose.
  – What would you do if you were about to graduate college and have been hesitating to get into Bitcoin since 2011 despite its wild growth since then?

Thanks so much for your time!

Elijah

1. I have never been involved in mining. It has always seemed like a very specialized, perfectly competitive business. At the stage of specialization we have today, I think it makes no sense whatsoever to get involved on a small scale.

2. ABSOLUTELY we need more marketing geniuses involved with Bitcoin! We need more people who can help explain the benefits of Bitcoin to non-technical people, and find ways of messaging that resonate more broadly.

3. Assuming you're talking about buying bitcoin, as always, I tell people they should never invest more than they can afford to lose completely. However, for someone that is just out of college, that might represent a larger share of financial assets, since your savings are likely low compared to your human capital (future lifetime earnings). Bitcoin is still a very asymmetric bet in my opinion. It will either go to zero, or go much higher.

[elijahkleinsimth.com]

Thanks for your helpful reply, Ben!

As a quick follow-up, if you don't mind: at this point, would venturing to create new messaging campaigns to help translate the benefits of BTC to the unaware public be an individual mission? Or are there openings for positions like this that I am unaware of? I assume, like any job, I would have to get my foot in the door and prove my worth first. I am just not sure if there are entities in a place to hire marketing professionals or not.

Thanks again!

All the best,

Elijah

[kristovatlas]

There's been a steady influx of companies and funding for blockchain analytics in the last year or two. Meanwhile, the data trail that software is leaving on the blockchain hasn't changed much in the last few years -- the only advancement has been the introduction of HD wallets to help avoid address reuse, but this hasn't made much of a dent. (Citation)

As blockchain analytics software becomes more advanced and more widely available, what's your view on how this will impact Bitcoin wallets and other service providers?

Do you think people will be turned off from Bitcoin if it becomes trivial for their friends and business partners to track their finances?

Thanks!

[bpd]

Thanks for your helpful reply, Ben!

As a quick follow-up, if you don't mind: at this point, would venturing to create new messaging campaigns to help translate the benefits of BTC to the unaware public be an individual mission? Or are there openings for positions like this that I am unaware of? I assume, like any job, I would have to get my foot in the door and prove my worth first. I am just not sure if there are entities in a place to hire marketing professionals or not.

Thanks again!

All the best,

Elijah

My advice to you, early in your career, is to find a position wherever you can learn the most, whether in Bitcoin or elsewhere. If that's at a Bitcoin company, all the better, but I wouldn't limit yourself so much, early in your career. Develop your human capital as much as you can, and stay involved with Bitcoin however you can.

[bpd]

There's been a steady influx of companies and funding for blockchain analytics in the last year or two. Meanwhile, the data trail that software is leaving on the blockchain hasn't changed much in the last few years -- the only advancement has been the introduction of HD wallets to help avoid address reuse, but this hasn't made much of a dent. (Citation)

As blockchain analytics software becomes more advanced and more widely available, what's your view on how this will impact Bitcoin wallets and other service providers?

Do you think people will be turned off from Bitcoin if it becomes trivial for their friends and business partners to track their finances?

Thanks!

I don't think this is the biggest problem holding the average user back from Bitcoin. But, aside from scalability, I think lack of privacy (and even more so, the associated loss of fungibility) is Bitcoin's biggest technical challenge. Fungibility is the one attribute where Bitcoin really falls down compared to gold. I'm pretty convinced that no matter how carefully you construct a wallet, it is very difficult to maintain full privacy. If you mess up once, the record is there forever. What we need are fundamental technological improvements which give privacy to everyone by default, not just those who take extreme measures to preserve it. There are some really promising developments in this regard, most notably, Greg Maxwell's confidential transactions (with real working code!) and slightly further out, developments such as Zerocash.

[TheKuja]

I saw your recent blog. Is a 1% fee for buying and selling too high? Should I switch to Bitgo? Is it easy to switch my wallet over?
Also, if crypto-currency takes off more then it already has worldwide, do you think Bitcoin will always be number one or do you think another digital currency will eventually surpass it?

[bpd]

I saw your recent blog. Is a 1% fee for buying and selling too high? Should I switch to Bitgo? Is it easy to switch my wallet over?
Also, if crypto-currency takes off more then it already has worldwide, do you think Bitcoin will always be number one or do you think another digital currency will eventually surpass it?

1. To clarify, my recent blog post was regarding blockchain (mining) fees, not fees for buying/selling bitcoin. A 1% fee (such as Coinbase offers) is not too bad for a long term buy and hold strategy, but is much too high if you were planning to actively trade.

2. I'd encourage you to try out our wallet and see if it meets your needs. It's ultimately as easy as doing a transaction to move from one wallet to another. You're never really locked in to one particular piece of software.

3. I think the network effects of Bitcoin give it a very very strong lead. But, if a new fundamental technology improvement comes along that is extremely in-demand, and Bitcoin fails to adopt it, it could be disrupted in that way.

[kristovatlas]

Thanks for your thoughts, Ben! With someone with your deep technical background and experience in Bitcoin, I'm really interested in your take on this. A few follow-up questions:

I don't think this is the biggest problem holding the average user back from Bitcoin. But, aside from scalability, I think lack of privacy (and even more so, the associated loss of fungibility) is Bitcoin's biggest technical challenge. Fungibility is the one attribute where Bitcoin really falls down compared to gold. I'm pretty convinced that no matter how carefully you construct a wallet, it is very difficult to maintain full privacy. If you mess up once, the record is there forever.

This is true. If privacy and fungibility are important, why do you think software providers have not at least implemented basic best practices?

There are some really promising developments in this regard, most notably, Greg Maxwell's confidential transactions (with real working code!) and slightly further out, developments such as Zerocash.

In your mind, what's the backup plan if protocol-level proposals like Confidential Transactions, Zerocash, and the Lightning Network don't bail us out of this privacy and fungibility hole? I'm excited about all of these technologies, but have taken note of the following trends:

• It seems like the recent scalability debate has proven that even slightly contentious changes to the protocol are extremely difficult to deploy, even when there is near universal agreement that a change needs to be made.
• Zerocash is going to be launched as an altcoin. To date, 100% of the many privacy-centric altcoins have failed to influence Bitcoin's privacy.

[bpd]

Thanks for your thoughts, Ben! With someone with your deep technical background and experience in Bitcoin, I'm really interested in your take on this. A few follow-up questions:

This is true. If privacy and fungibility are important, why do you think software providers have not at least implemented basic best practices?

Because doing it right is hard, as well as difficult to explain to the average user when they try to send a certain payment and it's impossible to do so without compromising privacy. Most software providers still haven't even solved much simpler basic problems like attaching dynamic fees to transactions.

In your mind, what's the backup plan if protocol-level proposals like Confidential Transactions, Zerocash, and the Lightning Network don't bail us out of this privacy and fungibility hole? I'm excited about all of these technologies, but have taken note of the following trends:

• It seems like the recent scalability debate has proven that even slightly contentious changes to the protocol are extremely difficult to deploy, even when there is near universal agreement that a change needs to be made.
• Zerocash is going to be launched as an altcoin. To date, 100% of the many privacy-centric altcoins have failed to influence Bitcoin's privacy.

Backup plan? We have a backup plan? I think we're still trying to figure out plan A. While you're correct, that privacy-oriented coins haven't caused Bitcoin to adopt any particular privacy technology yet, I will also note that none of them has really developed any serious user traction either. So, thus far, people are not voting with their feet. I think a measured approach makes sense when you have $6B stored in the chain -- we need privacy, but we need to make sure we do it in the best way we can, with the least risk.

[timryan]

HI Ben thanks for participating!

How important is the tradeoff between security and simplicity?

One of the things difficult about new technology adoption is making new users comfortable trying it out, layer that with the psychological and financial aspect of Bitcoin and it makes it very complicated for many people to grasp.

How would you explain Bitcoin technology at this current moment to your six year old daughter and to your eighty-five year old grandfather?

Thanks again,
Tim

[bpd]

HI Ben thanks for participating!

How important is the tradeoff between security and simplicity?

It's obviously one of the biggest usability challenges when you move beyond a highly technical set of users. Fortunately, there have many improvements that have reduced this as a straight trade-off. For instance, it's possible to use a multi-sig wallet that's just as easy as any other wallet, but dramatically improves security. And the development of multiple hardware wallets such as Trezor, Keepkey, Ledger, etc. makes following good security practices much easier for the average user.

One of the things difficult about new technology adoption is making new users comfortable trying it out, layer that with the psychological and financial aspect of Bitcoin and it makes it very complicated for many people to grasp.

How would you explain Bitcoin technology at this current moment to your six year old daughter and to your eighty-five year old grandfather?

Thanks again,
Tim

To an 85 year old (who still remembers the gold standard):

Bitcoin is like a digital version of gold. No government can print it. It can't be counterfeited. It can't be seized from you. And you can send it anywhere in the world in an instant. Like gold, it has value because other people value it, and because of its special properties that make it a good money.

To a 6 year old:

Bitcoin is the real money. For some reason, you mostly still have to earn this paper monopoly money first in order to get your real money. But that will change.

[glambeth]

Hi Ben, I've been a huge bitcoin enthusiast the past 2 years and couldn't imagine working in another industry. However, I'm having difficulties finding an internship at a Bitcoin/Crypto startup. Is there a possibility that BitGo will offer any software engineering internships for summer '16?

Feel free to contact me at glambeth (at) umich (dot) edu if there's a possibility.

-George

[Deloren]

Hi Ben,
Thanks for the AMA.


Currently, multisignature is vastly adopted by businesses/exchanges etc... not by end users. How do we create/promote user friendly multisig solutions? Is it an awareness or business model problem?

Thanks!

[bpd]

Hi Ben,
Thanks for the AMA.


Currently, multisignature is vastly adopted by businesses/exchanges etc... not by end users. How do we create/promote user friendly multisig solutions? Is it an awareness or business model problem?

Thanks!

I think probably it's because these businesses & exchanges are subject to much harsher operating conditions than a typical user. For an exchange operating a hot wallet, which constantly has funds flowing through it, multi-sig is absolutely essential. The reason is, if the exchange's hot wallet keys are compromised they MUST be able to hit a panic button to stop all co-signing, or the losses will continue to mount, as users continue to deposit funds to old, compromised deposit addresses. There is NO WAY to revoke a bitcoin deposit address once issued, and in our experience a large percentage of the losses can come after the breach is first discovered.

The other thing multi-sig helps do very well is to allow you to layer on access controls for multiple people within an organization, set spending limits and approval policies and so forth -- a problem most end-users don't have.

On the end-user side, I think people tend to buy and hold most of their bitcoin for the long term, and for that, cold storage and/or hardware wallets can do a really good job of security because the transactional volume requirements are not very high. And meanwhile, they can happily put a small amount of bitcoin on a phone for transactional purposes in a single-sig wallet, and here, security is not a huge concern because the value is not very much.

I do think that as people start to think longer term about questions like: "How do I ensure my heirs retain access to my bitcoin after I die, but ONLY if I die?", they will find advantages to using a multi-sig approach.

[BTCLuke]

Hi Ben, thanks for doing this.

I've been fascinated by 3rd-party exchange multisig wallet services like yours and Gem's since I first heard of them. -I wish they'd become the absolute minimum in security that any bitcoin trader would accept, but I know that people won't always be informed enough to look for things that are good for them.

Has BitGo, or perhaps even a consortium of wallet providers, ever considered doing some kind of massive public education push to show people why they should only accept multisig account-offering exchanges?

Also, about the technical side of the issue for exchanges: If an old-style exchange wants to upgrade to accept multisig accounts like you offer, how difficult is that upgrade? I imagine they go from just having a trading wallet to having some sort of 2-tiered wallet plan... Is that very difficult for exchanges to implement?

Thanks!
-Luke

[szwu]

你好：）Ben

I'm an early bitgo user come from china since 2014.At that time i can not withdraw my bitcoins from btcchina (now btcc) to bitgo wallet because the address was started as "3" ...don't know why but p2sh address was born in 2012 afaik.
Now I'm also use Blocktrail. When i knew patent news i was surprised after that news I transferred my coins to the Blocktrail. Because i am not convinced why a patent is needed in the Bitcoin space.

Sorry for my bad english.


szwu

[danster82]

Hi Ben

Whats your opinion on blocksize, do you support any proposed BIPS?