Co-Founder of the investment platform cyber•Fund shares with CoinFox where it is cheaper to register bitcoin startups, how his kitchen became a mining farm and why he does not care what Russian authorities have to say about bitcoin.
CoinFox: How did you get interested in bitcoin and blockchain in the first place?
DS: First I took an interest in the technology in April 2011. I am a real bitcoin pioneer of a kind: at some point mining rigs in my kitchen and on the balcony were powering 0.5% of the whole bitcoin network. I wanted to experiment with it since I immediately saw its potential: the money uncontrollable by the state. When my friends first told me about bitcoin I was lost for five days, I started digging this stuff trying to find the answer. I could not believe it was truly controlled by no one.
CoinFox: But yet many projects seek to get registered in particular jurisdictions. Do you have any preferences in that respect?
DS: We constantly work on it. We have considered Singapour, London, Isle of Man, Luxemburg. There are no preferences yet, but we do want to find a place to launch a project cheap and seamless in terms of accountability and taxation. Say, we want private keys to be treated as software licences, not as currencies, shares, money or anything directly connected with finances and all hassle associated with it.
Basically, so far we do not really need any registration in any particular jurisdiction. In fact, it is not just one project that we are doing, there is a number of them: an Ethereum-based decentralised investment platform, also Blockchain Asset Management, a company that will create trust investment products of the kind of ETF and open-end funds. These open-end funds can be both based on blockchain, that is, on personal trust to us, or registered in some jurisdiction. The great advantage of blockchain is the possibility to have everything virtually for free. Let’s say, we have a private fund that uses tokens as an equivalent of shares, and blockchain accounts to keep money in. Everything is verified with cryptography. In this case, there is no technical necessity to be attached to any jurisdiction.
We are building a decentralised autonomous organisation which is not bound to seek approval from any jurisdiction in the world. The intrinsic value of its stocks will be generated by their use to create smart contracts for investment. Say, to launch a private investment fund and carry out reporting for it, to create an ETF based on indexes provided by us. Or, another example, to do price feeds, which are a big problem for smart contracts today.
This is not to say that we won’t need jurisdictions at all. First of all, we need them just because people are used to it, for them, it is not easy to accept that legal person is no longer necessary. Meanwhile, blockchain makes the classic idea of legal person obsolete. Secondly, we have to consider jurisdictions when our customers want to convert fiat money into blockchain assets or vice versa. In this case to build the whole cycle of relationships with the client we will have to register the company in an appropriate jurisdiction because fiat money still cannot work in any other way.
CoinFox: What do you think about the initiatives of Russian regulators as regards to cryptocurrency? In particular, to the recent statements of the Ministry of Finance and the Investigative Committee demanding criminalisation of bitcoin circulation and exchange to rubles and vice versa?
DS: I don’t think about it at all. I’m serious. I don’t have to think about it because I don’t exchange bitcoins to rubles, that’s all. Despite all these initiatives, there are a lot of very important people in Russia who does not advertise their position towards cryptocurrency, but still have serious interest and investments in bitcoin. I guess these initiatives only mean that the adoption of bitcoin in Russia may take a certain dramatic turn, let’s put it this way.
CoinFox: Why, in your opinion, regulators in many countries are so uneasy about blockchain technologies?
DS: A decentralised system works on the supranational level, it doesn’t have to obey a regulator the way a legal person does. We came to a truly supranational economy – this is bitcoin. It has already proven its case, but it is not alone. We should not be scared to admit it and call it by its proper name. The real Internet economy is already here, and it’s only a matter of short time when it overgrows and overpowers any national economy in existence.
Svetlana Nosova
