{"id":9338,"date":"2022-05-18T22:06:50","date_gmt":"2022-05-18T22:06:50","guid":{"rendered":"http:\/\/ci02a1828a1000253b"},"modified":"2022-05-18T22:06:50","modified_gmt":"2022-05-18T22:06:50","slug":"block-investor-day-2022-talks-bitcoin","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/business\/block-investor-day-2022-talks-bitcoin","title":{"rendered":"Jack Dorsey\u2019s Block Wants To Create Economic Empowerment With Bitcoin"},"content":{"rendered":"
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Block\u2019s overarching purpose is to drive economic empowerment in the world and Bitcoin plays a central role in that mission, its chief executives said during the firm\u2019s first Investor Day since 2017 on Wednesday.<\/p>\n

\u201cWe believe Bitcoin is going to have a profound impact on financial services, particularly as a tool for economic empowerment and as a global currency for the internet,\u201d Block\u2019s finance lead Amrita Ahuja said during the online event following a statement that the company has \u201cjust scratched the surface\u201d for driving further adoption of bitcoin in the U.S. and globally.<\/p>\n

Ahuja shared her thoughts after Block chief Jack Dorsey opened the event with an introductory panel explaining the broader goal of the company and how it plans to achieve it.<\/p>\n

Dorsey, a long-time Bitcoin proponent<\/a>, said that Block\u2019s approach is to create \u201can ecosystem of ecosystems\u201d \u2013 with each business sector being dedicated to building an ecosystem on itself that can not only scale but feed back into other ecosystems across the organization.<\/p>\n

Cash App And Spiral \u2013 A Case Study<\/h2>\n

Cash App\u2019s recent integration of the Lightning Network<\/a>, Bitcoin\u2019s overlay protocol for faster and cheaper payments, is an example of how Block seeks to have different business units producing products that can feed back on each other.<\/p>\n

The money transmitting app added support for Lightning payments through the Lightning Development Kit<\/a> (LDK), software developed by Spiral<\/a>, an independent subsidiary of Block focused on developing and funding open-source Bitcoin projects.<\/p>\n

\u201cBitcoin is the best version of money,\u201d said Spiral lead Steve Lee. \u201cWith our help, we believe it can become the world’s preferred currency.\u201d<\/p>\n

Cash App was one of the first business units of the company that was then Square to integrate Bitcoin. The application added bitcoin buying and selling capabilities along with a custody solution for customer funds back in 2018<\/a>, its lead Brian Grassadonia said in the event. <\/p>\n

Since launching the feature, Cash App has had more than 10 million monthly active users buying bitcoin in the app and the spread fees charged by Block on such purchases have become one of the main revenue drivers for Block. Cash App\u2019s gross profit has grown by 44x since 2017, Ahuja showed in the event.<\/p>\n

The integration of Bitcoin into Block\u2019s business model has become more widespread since Dorsey left his post as Twitter CEO \u2013 and now goes beyond a bitcoin exchange in-app.<\/p>\n

The Bitcoin Ecosystem<\/h2>\n

A core aspect of Block\u2019s business is what it calls the Bitcoin ecosystem, which falls under the \u201cemerging initiatives\u201d of the company that are not as established as Square or Cash App \u2013 which have both found product-market fit and managed to scale their business model, according to Ahuja.<\/p>\n

In addition to previously-mentioned Spiral, Block\u2019s Bitcoin ecosystem is composed of an open-source business called TBD, and the company\u2019s Bitcoin wallet and mining initiatives.<\/p>\n

Bitcoin Wallet<\/h3>\n

Block seeks to create a Bitcoin wallet for the masses<\/a>, uniting security and ease of use to make self-custody accessible to those new to Bitcoin. <\/p>\n

The product aims to encourage regular folks to hold the keys to their bitcoin funds as opposed to resorting to custodians amidst more complicated self-custody setups that are popular today. In the same way that Spiral\u2019s LDK helps developers and businesses more easily integrate Lightning to their applications, Block wants to facilitate self-custody for end users, explained Block\u2019s Bitcoin hardware wallet lead Jesse Dorogusker.<\/p>\n

\u201cIf you don\u2019t have the key, you don\u2019t have the money,\u201d said Dorogusker. \u201cWe want to build a safe and easy way for people to custody their own bitcoin. Our wallet breaks up the secret key into three pieces: mobile app, hardware device and a self-service recovery tool.\u201d<\/p>\n

The company seeks to avoid single points of failure with this approach, which it claims could improve the user experience around bitcoin self-custody \u2013 which currently revolves around 12 or 24 seed words.<\/p>\n

Bitcoin Mining ASIC<\/h3>\n

Block\u2019s Bitcoin ventures also extend to the mining industry. <\/p>\n

The company said it is focused on creating an open system that would cut back on the concentration around Chinese manufacturers of bitcoin mining ASIC chips. The approach \u2013 an open-source setup \u2013 has the potential to reduce risks and increase competition, Dorogusker said.<\/p>\n

\u201cWe want to build our own bitcoin ASIC,\u201d Dorogusker, who also leads the mining initiative, explained. \u201cOur ASICs will be available for sale and will all be open source.\u201d<\/p>\n

The company had previously stated that it would develop an open bitcoin mining system<\/a>, and a job post by Block was spotted in January<\/a> seeking a team to produce a \u201cnext-generation\u201d bitcoin mining ASIC. However, this was the first time that the company shared that it would be producing an actual bitcoin ASIC which would be open source.<\/p>\n

Decentralized Bitcoin Exchange<\/h3>\n

In addition to a bitcoin wallet and a bitcoin miner, Block is also tip-toeing into bridging the traditional finance world with the burgeoning system through the cryptic TBD unit<\/a>.<\/p>\n

\u201cTBD\u2019s mission is to bridge the old to the new,\u201d TBD lead Mike Brock said. \u201cWe are building a new open-source company from the ground up focused on open protocols and open standards that all participants in the economy can benefit from. What Red Hat did for Linux, TBD can do for money, payments and identity.\u201d<\/p>\n

Brock went on to explain that under the \u201cold\u201d model as he calls it, which relies on centralized entities, 1.1 billion people are unable to prove their identities. TBD wants to bring a secure, decentralized identity standard to enable not only such customers to benefit from a more accessible and fair protocol but also for businesses to lower their costs.<\/p>\n

\u201cUnder the new financial system, you can create your own digital identity and use all of those services that require identity verification,\u201d Brock said. \u201cYou can also create a digital wallet to hold bitcoin or stablecoins, and you can convert stablecoins into bitcoin directly without leaving the app because it is integrated to tbDEX.\u201d<\/p>\n

\u201cIf we’re going to have an internet-native currency, we need trust, and trust comes from time, openness and transparency which are principles that are embodied in the Bitcoin system,\u201d Brock said when asked by Dorsey why he believed in Bitcoin in the first place.<\/p>\n

\u201cWe are building a network that provides better experiences for financial access around the world,\u201d Brock said in closing thoughts.<\/p>\n

From Businesses To Consumers<\/h2>\n

Just as Square caters to businesses and Cash App targets consumers, so Block\u2019s Bitcoin ventures seek to provide a round-up of solutions that collectively empower retail and institutional investors in the decentralized and digital economy.<\/p>\n

Amidst a sea of early-stage Bitcoin initiatives, most of the details remain unknown as the company takes steps toward building its products by iterating between ideation and feedback-gathering from the community. It remains to be seen whether Dorsey will be able to stir the corporate ship to enhance economic empowerment with open Bitcoin systems beyond the independent work of Spiral.<\/p>\n","protected":false},"excerpt":{"rendered":"

Among Block\u2019s initiatives to further the Bitcoin ecosystem shared in its 2022 Investor Day is the development of an open-source bitcoin mining ASIC chip.<\/p>\n","protected":false},"author":2572,"featured_media":8890,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[198,189,286,313,750,681,93,1087,749,1586,1587],"class_list":{"0":"post-9338","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-asic","9":"tag-bitcoin-mining","10":"tag-bitcoin-wallets","11":"tag-block","12":"tag-cash-app","13":"tag-jack-dorsey","14":"tag-news","15":"tag-spiral","16":"tag-square","17":"tag-tbd","18":"tag-tbdex"},"author_data":{"id":2572,"name":"Namcios","nicename":"namcios","avatar_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/12\/pfp-96x96.png"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/11\/block_film_stills_block_chain.png","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/9338","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2572"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=9338"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/9338\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/8890"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=9338"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=9338"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=9338"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}