WEBVTT
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Welcome to Drilling into Crypto. I'm your host, Mohammed al Masri.
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Every week I speak to the leaders that are driving
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the global financial revolution. Drilling into Crypto puts the spotlight
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on the importance of crypto assets on energy markets and
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on global monetary policy.
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Great we have Owen with us from Bitroots. Thank you
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for joining Drilling into Crypto. Owen, how are you today?
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Yes, very good, Mo, how are you?
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I'm very well. Thank you.
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I'd like to start off, as every episode that to
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ask you about yourself, mainly about your journey you what
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you were doing before bitroots and before finding bitcoin, and
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how you ventured into the space.
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Yeah.
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I love this question because I think everyone has their
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own journey into bitcoin and it's all unique and use
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it from a very wide variety of industries. In my case,
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it was from academia, so specifically mathematics. I studied a
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PhD in mathematics, and I wanted to be a professor,
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you know, with like the tweet jacket and leather arm patches.
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But that future wasn't looking so great when you look
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at the hours you have to work and the conditions
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you have to work in. So I was looking to
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switch to something different. And I had a friend who
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was working for a bitcoin R and D company and
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he said, oh, I think you might be well placed
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to come and join us here. And that was two
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thousand and eighteen, and I didn't know anything about bitcoin
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at the time. I mean, i'd heard of it. I
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was curious about it at that time. It had both
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a positive and quite a negative reputation, but I thought,
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why not give it a go? And some of the
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geometry I'd studied is actually relevant to bitcoin, And this
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was actually a surprise to me. I didn't realize that.
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But the cryptography in bitcoin, in the signature scheme is
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based on something called elliptic curves, and these are a
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geometrical construction that I studied well on the pure mathematics side,
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So that that was my kind of technical link to
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bitcoin and cryptography. And I spent seven years leading an
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R and D team there doing research in how to
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scale the technology, how to use it in a way
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that's both user friendly and private, a lot of cryptography.
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So published a lot of papers in cryptography. But around
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a year ago I was looking to buy some bitcoin,
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and I knew the I know the industry very well
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and I knew that a lot of miners were now
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using renewable energy, primarily because it's just the cheapest form
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of energy and it's intermittent, and bitcoin mining couples very
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well with that because you can turn it off and
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on very quickly, you can co locate to the mining source,
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and so on. So I wanted to buy some sustainably
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mind bitcoin directly from these miners, but it just wasn't possible.
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It wasn't although I knew who the miners were, they
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were just selling their coins on exchanges and the coins
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weren't in any way linked to them after they were sold.
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So I thought, this is this isn't right. You know,
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I would really be very I want these coins directly
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from them. I'd be very proud to own them knowing
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that my purchase had gone to help renewable infrastructure financing
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and other forms of sustainable development. So that's why I
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founded bitroots, which is to really our mission is to
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transform bitcoin mining into an ESG tool. I mean, many
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miners are doing this already, but it's allowing additional revenue
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streams for them by matching them with the people who
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want these coins. So you might be a family office
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who have certain ESG principles. You might be a fund
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or a treasury who wants to make sure your assets
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are sustainable, or you might be a defied platform. You
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might want to do lending and staking using bitcoin and
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you want to have that powered by something that is sustainable.
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So what we do is match those buyers with the
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miners who are using sustainable energy so that you know
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your coin has come from one of these sources. And
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what we do at bit roots we provide the assurance
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of that. So we have a certification scheme that tells you, yes,
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this coin was mined by this miner using this energy.
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And you can really think of this as the world's
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first provenance platform for bitcoin, so we can tell you
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where your bitcoin comes from.
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That's beautiful. So definitely.
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A concept that's been around for some time, but I
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haven't seen anyone actually adopted in a formal certification fashion
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on the blockchain that is mutable, transparent, and that follows
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through with the mind bitcoin from its stage of minting
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up until the and throughout the process of it going
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onto the market. Now, after it goes onto the market,
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in that coin starts treating, does that certificate continue to
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follow that coin on the Ledger.
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Yeah, that's exactly right, MO. So I call that the
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secondary market. So the primary market is the miners selling
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their coins directly to the first buyer, and this does
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happen in an ad hoc way, like I do know
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some large buyers who are getting these sustainabley Mind coins,
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but the problem comes when they want to sell them onwards,
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they have no proof that they went to all these
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lengths to get these sustainable coins. That's where our certification
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tracking software really comes into play, so that when if
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you purchase one of these coins and you want to
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sell it on in the future, you have that continuous
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record of provenance from a sustainable minor. So you can
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think of what we're trying to do as and make
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this a mature secondary market.
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And that's interesting because then you can find an alternative
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to voluntary carbon credits.
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Yes, so.
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My limited understanding on carbon credit markets, but I know
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there are two markets, right, the official one which is
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trillions of dollars in volume and then or maybe close
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to a trillion, and then the other one which is
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a few billion dollars in right, so that that the
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the two or three billion dollar voluntary carbon credit market.
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Is what they call it. I believe I think that
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that is a niche that or that is a market
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that I that this solution could tap into and provide
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more credibility, more returns from a financial perspective, and real
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world ESG use cases that actually adopt real technology, physical
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infrastructure for compute that ultimately not just benefits the energy
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asset itself, but.
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The the community around on it.
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Right, Yep, that's a social part of the ESG.
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Yes, that that monetary aspect or that financial aspect of
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the mining operation could then be invested back into these
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communities with and if it were to be sold, then
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you might be able to get a premium on it.
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So all these things linger in my mind when you're
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when you're explaining that if you can touch on some
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of these things that I mentioned, that would be really
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interesting for us to understand.
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I can give you a very concrete example about how
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this is providing a social benefit. But first I've just
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mentioned carbon credits. So I love carbon credits, especially the
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voluntary ones, because I see this as you know, a
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lot of people, a lot of organizations trying really hard
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to make sure that they are carbon neutral by purchasing
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these credits. But what we can do is actually go
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one step further and say, okay, instead of purchasing an
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asset and then buying a carbon credit to off the
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impact of that, we can give you assets that didn't
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cause any emissions to begin with. So we can say
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to you, these bitcoins did not cause any emissions in
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the process. Because it's worth always remembering bitcoin mining is
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a completely clean technology. So the mining operations themselves, they're
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just data centers. They take electricity and the only output
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you get is bitcoins and heat. That's it. There's absolutely
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zero pollution involved in that. And then if your energy
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source is sustainable, is renewable, then that whole process is
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emission free. So what we can say to people is,
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here are some bitcoins that didn't cause any emissions to
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begin with, so no need to purchase carbon credits. So
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that's quite a compelling value proposition if you want to
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help directly incentivize emission reduction before you.
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Move on that. As that reminds me of.
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I do work on the Financial Advisory Site or Energy
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to Cope projects, and we do work on the renewable
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side as well. Some of the discussions that came up
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from external bonders.
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Were who's going to off take this energy?
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Right?
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And our business revolves around energy to compute, so trying
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to monetize renewable energy sources or subsidized power or idle
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and wasted energy. And when you bring up the point
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that bitcoin minors will be the off takers of first
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and last resort for the purpose of early monetization on
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the asset until there's a grid tie and austral or
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commercial use case. But they start to ask questions like,
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but this doesn't benefit the country of origin, right or
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the community where this project is being built. But I
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think what you just mentioned about, you know, the is
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angle is a good rebuttal how would you answer such
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a question.
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Oh, I'll answer that with a very concrete example in
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that's operational right now in Ethiopia. So you may be
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aware of the Grand Renaissance Dam. It's the largest hydro
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dam in Africa. It's only just been finished when operational
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last year. And in Ethiopia they have a grid that's fragmented,
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so not every community, particularly the rural communities, can get
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access to the electricity generated by this dam, which has
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twice as much as the country you will ever need.
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So what they did is they were quite progressive. They
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invited the bitcoin mining community to come along and to
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purchase this energy, to off take this energy that would
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otherwise be wasted. And in twenty twenty five, the Ethiopia
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Electric Authority generated over two hundred million dollars by selling
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their excess, completely excess electricity to bitcoin miners. And they
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use this directly to install power lines to connect these
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rural communities, which ultimately lifted people out of fuel poverty.
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So this is where when I heard about this, I
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was just blown away and I thought I have to
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get involved. So I personally invested in a mining operation
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in Ethiopia. And I'm really proud of this, of the
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story behind these coins. So when I mind my coins,
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I'm not only happy because there are one hundred percent
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sustainable from a hydro dam, but they are also helping
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lift people out of fuel poverty, and I just think
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that's such a great story that I'm really proud of.
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And I want other people to be able to get
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access to these type of coins if they want to
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invest in bitcoin, but choose to do so in something
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that has an ESG impact. That's what I want to enable,
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and that's ultimately what I'm trying to achieve at bit roots.
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That's beautiful.
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So that's very concrete.
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Yeah, I love I love it, and it's just you know,
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exactly where where this is going. And when I mean this,
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I mean the bitcoin mining industry. The energy to compute
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transition is you know, it comes with a purpose, and
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I believe there are at least, you know, I'd like
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to believe that there are still quite a few of
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us that are mission driven and purpose driven and still
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want to do this for the betterment of society.
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Uh.
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But living in a globalized capitalistic world or a globalized
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world that does adopt you know, the essence of capitalism,
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which could be a good thing if put to good use,
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there's still that angle of you know, above average it's
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a don't usually like to use that word when speaking
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about investments, but above average returns or never sometimes never
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before seeing returns depending on what the network effects are
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at the time and how the market is performing.
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So you know, it does capture the entire esg.
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Essence, and there is that alternative investment asset class that's
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still widely untapped by you know, institutions and investors. So yeah,
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really interesting stuff this bitcoin, if certified in that fashion,
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could have a premium at some point in time once
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this market is adopted.
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Yes, it does have a premium. So it's similar to
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this concept already exists in many markets, for example the
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gold market and diamond markets. So nowadays with diamonds, you
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can't buy a diamond anymore at a retail outlet that
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doesn't come with a certificate assuring you that this diamond
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was mined ethically, and there are a scheme called I
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think it's called Sustainable Mind diamonds. And in the gold
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industry another scheme exists. It's called fair Mind Gold. So
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if you are a gold mine and you have very
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good ethical and environmental standards, then you invite fair Mind
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to come along and inspect your facility and they will
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give you a certificate, and your gold trades at a
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premium that's around two to four percent premium. Now, I
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suspect we'll see something similar, possibly a bit more for bitcoin.
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At the moment and in the future, we just don't
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know what that will be priced at. I happen to
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think it might be priced a much higher premium because
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we have the assurance of where this has come from
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and when I talk to people particularly, you know, for example,
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I has had a very nice conference in London last
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week called Crypto for Good, and I explained to them,
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citing the example in Ethiopia. People just haven't heard this,
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and when they do, their eyes light up. This is
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this is fantastic, this is yes, I want these bitcoins,
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you know, I now no longer just want to buy
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them off in exchange.
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Makes you think that it's such an obvious thing to know,
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but you realize there are so many people that don't
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know about it. That's when the light bulb comes out. Okay,
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there's still a lot of work to do, there's still
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a market there.
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Don't lose hope.
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But because you're in the industry, sometimes you feel like
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it's it's so obvious, everyone knows it, so it seems
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like no one's interested.
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But actually a lot of people with the interested. You
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just got to get in front of them.
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And Yeah, I believe that premium will eventually catch on because.
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It just from my perspective, it would.
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Make more sense to buy a certified or e is
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she certified bitcoin versus just a standalone carbon credit.
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Yeah, and it might. You might look at it in
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terms of risk if you're in an industry that has
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strong regulations on this type of thing, it's just less
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risky asset. Also from the perspective of risk from previous
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coin holders. So for example, there are certain funds well
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actually I think a lot of them, a lot of
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the like the ETFs, they have a policy of transparently
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disclosing their their assets. Usually you have to be at
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a high enough level of investment to get that information.
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And they whenever they purchase a bitcoin, they they screen it,
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they check it a certain amount of hops of previous
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owners because if that was ever associated with the proceeds
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of crime, then that bitcoin will there's a there's a
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risk to them that they would have to could be confiscated.
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There's not just bitcoin. Of course, this happens in the
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art world. Having with a Picasso painting at Christie's last year,
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that was a really interesting one where the person who
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purchased it sued Christie's because they said, you you you did,
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you could have told us more information about the previous
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owner of this painting and we could have avoided doing
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something untoward there. So it's not just big going that.
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This effects is every asset and if you get it
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directly from the source, from the miners. You know, there's
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no there's this less risk because there's less history involved.
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So not only that's the kind of governance aspect of it.
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So these coins are particularly valuable to to people who
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are trying to sell exposure to them, like funds, like
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lending and staking platforms.
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Yeah, I see a wider adoption even on regulatory compliance
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level for environmental relators and environmental authorities. Right for example,
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in Alberta, we have the carbon tax right a certain
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extent based on certain emissions thresholds for for for power plants.
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And energy producers.
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And you know, you're you're you can offset your carbon
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tax with carbon credits, buy them off the market. And
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you know, some of these energy producers that have excess
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energy or enough energy to mine their own bitcoin, you know,
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whether it's capturing flare gas and and and you know,
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instead of flaring then you're generating power mining bitcoin and
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having a certified ESG certified bitcoin on your books. If
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only we were in a position or there maybe there
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must be some work you and I will need to
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do to convince the you know, federal and or provincial
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governments and the regulatory authorities to accept ESG certified bitcoin
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just as they would carbon credits for the purpose of
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offsetting carbon tax.
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Right absolutely, I think I.
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Think there's a much wider adoption for this.
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That is, and and you know, as as as mature
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we might think it is, it's still very early.
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Well, so I love the use case of flare gas
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because this is where bitcoin mining is not only carbon neutral,
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it's carbon negative. So this is preventing wasted methane being
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released into the atmosphere by instead turning that into energy
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to mine bitcoin, which reduces the amount that is released.
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So you know, not only is it carbon are those
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coins carbon neutral? They're carbon negative. You just give me
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a kind of a great idea there. You could think
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of them as a carbon credit. If you own these bitcoin,
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you have offset this amount of carbon. So there you go.
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That is a problem that exists today in certain countries
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and the provinces and states. It's a burden on investors
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or actually it's not a it's a burden on the
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operators and also a it it it turns away investors
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like foreign direct investments because of carbon tax could really
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kill a project's economics. So so these are these are
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things that I think you know, bitcoin could optimize assets,
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could optimize treasury.
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Uh.
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It just transforms your energy asset if it were stranded
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or wasted, into.
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A valuable.
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Produce cash flow producing asset which which just goes a
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long way. So this is really amazing. Yeah. I want
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to learn more about this, uh and and and apply
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real world use cases to it. But tell me more
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about you know, how did that certification of bitcoin come
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to mind? But when was that Eureka moment for you?
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When was that.
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Aha moment that allowed you to Yeah, this.
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Was I was thinking about, as I say, purchase these
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coins directly from a minor, and then I was I
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thought to myself, well, when I come to sell these coins,
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I want a record by a certificate of where I
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got them from and the power that was used.
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And why did you think about wanting that record? Is
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it because of your own values or something sparked that
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thought that my bitcoin should be clean.
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I it was my own values. So I thought, if
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everything being equal, I would prefer a bitcoin that I
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knew had come from renewable. And then I thought, well,
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I would also like to show that to people. You know,
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I want to be proud of it. I want to
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show it off. How can I do that, you know,
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other than how I let people into the research that
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I've done into acquiring this coin, and you can capture
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that in a document which is essentially a certificate. And
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because I've done a lot of R and D about
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the you know, the protocol transactions to how they're linked together,
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I knew how that tracking element would work. So you've
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got to be careful if I have, like, let's say,
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a certify coin, not to mix that with an uncertified coin.
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Because we know that bitcoin is fungible on a stical level.
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These still are, so we don't we wouldn't write any
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data to the chain. You know, a bitcoin is still
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a bitcoin on the ledger, so you could mix these up,
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So you have to be careful not to do that
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if you want to easily trick it. But I actually
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I knew more sophisticated methods to track the provenance of
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your bitcoins. So there's a protocol called ordinals, and some
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people know this through an nft craze called Ordinal inscriptions.
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I don't have any comment on that, but ordinals as
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a concept is simply a way to identify every stoce
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when it was minted onto the ledger and to track
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it throughout its lifetime as it's traded on the ledger.
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And that was a missing piece of the puzzle. It
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meant that, well, okay, once I can identify the coins
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when they were first minute, once I can associate them
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with this particular sustainable mining operation, I then also have
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a method to track them throughout their whole lifetime as
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they're traded on the ledger. And you put those things
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together and you get a very strong process of a
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method for establishing the provenance of every single cetoce.
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Are attached to the coin that's mine right now.
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I'm not No, I'm not attaching any NFTs because I'm
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not using the I'm not using ordinal inscriptions, which is
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an NFT protocol. But ordinal theory is simply a method
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to order every satoshi. That's why they're called ordinals. So
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I'm using that methodology to track Satoce's nothing to do
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with NFT. So it's kind of using the same underlying theory.
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See so on the ledger, and what does it show
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certified coins.
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On the ledger? You will not see anything. You will
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just see nor bitcoins being traded. So ordinals don't require
401
00:24:00.599 --> 00:24:04.000
ordinar theory doesn't require you to write any data to
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the chain. That's why it's such a cool and useful.
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How can someone identify that this is a certified.
404
00:24:12.839 --> 00:24:15.880
Oh by additional data. So let's say I was to
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say to you this utxo is a certified coin. I
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will also give you the certificate that says so. And
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if you trade that with someone else, then everything is
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linked together because every transaction is linked to the previous transaction,
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so you can just go back until you find the
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certificate of origin. So it's almost like a birth certificate.
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I kind of think of it.
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Sometimes data sets better access, like via API.
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Yes, yeah, we have an API to certify, also a
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manual verification if you want to go on our website
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as well.
416
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Is that propriet theory or is that.
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That's proprietary big software?
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YEA very nice, but I must say the the fascinating stuff.
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This is a thank you very much and I'd love
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to follow up with you about it as well, because
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we are we are now rolling out this and we're
422
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looking for miners who want to be on boarded, who
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are very proud of what they do and want to
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get access to these premium markets and similarly to the
425
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people who want these coins. You know, our order book
426
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is open. So if you are individual fund the DeFi
427
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platform that wants to be powered by sustainable bitcoin, please
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come and talk to us and we will put you
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in touch with the miners.
430
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Yeah, I love it.
431
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Anything else you'd like to touch on, you know, because
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we we we look that environmental, we look at social
433
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governance pretty much, you know, presented real world use cases
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that some you've been part of and have skin in
435
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the game, mum.
436
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And you know how important is it for minors?
437
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You know, because not all miners are adopting you know,
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these values within their operations or these principles within within
439
00:26:14.680 --> 00:26:15.880
their business in general?
440
00:26:16.839 --> 00:26:18.000
How important is it.
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For minors too A certify their bitcoin and ensure that
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bitcoin operates on clean and or you know, renewable slash
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alternative energy you know, where carbons either emitted prevented, it's
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it's either captured, prevented AH or mitigated.
445
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Uh.
446
00:26:44.000 --> 00:26:47.039
You know, so how important is it for for these
447
00:26:47.079 --> 00:26:50.920
miners to do that? I know you're your answers. It's
448
00:26:51.000 --> 00:26:54.599
very important, and you know there's an obvious reason why,
449
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but I want to look at it more from a
450
00:27:00.480 --> 00:27:04.920
community standpoint, and I'd like to know your perspective, you know,
451
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politically about this, because bitcoin miners are not just bitcoin
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miners in my perspective, they're they're operating a new monetary
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system or new monetary network HM new compared to the
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Fiat one that we have. But and and they're contributing
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to a network that's widely adopted by hundreds of millions
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of people, with over two trillion dollars in market cap.
457
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And it's no longer a game played by developers' basement, right,
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It's it's it's worldwide, it's institutional, it's backed by sovereigns,
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by governments, by state backed corporations, all adopting bitcoin mining
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as infrastructure for energy monetization and power grid stability and
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load balancing. In addition to you know, their their their
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own FX reasons right or foreign currencies.
463
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All that makes it, you know, much more.
464
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Important to have a proper proper governance around around bitcoins
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ESG compliance so in you know, within sixty seconds or more,
466
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if you want to just give us your perspective on
467
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the political importance of bitcoin minors, mainly mainly and you know,
468
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I want to put them on the spot public miners.
469
00:28:48.240 --> 00:28:53.440
Yeah, yeah, okay, I would say it's we're what we're
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talking really is about responsible mining.
471
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I think.
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So, I think we're seeing already a shure.
473
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You're so eloquent in simplifying what I'm trying to say.
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00:29:02.119 --> 00:29:05.200
I'm just chaos in my brain, actually, but thank you.
475
00:29:05.519 --> 00:29:08.119
Yeah, no problem. Well, well you're very clear to me,
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so and I'm enjoying the conversation. So here's a I
477
00:29:12.319 --> 00:29:15.079
think very soon or already we're seeing a shift into
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a right to play for miners is to be responsible
479
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within the community you're in placed. And there's a great
480
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example that's just happened last week. So there were severe
481
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winter storms in the US, and as such, there was
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a severe demand on the grid, and a huge portion
483
00:29:36.079 --> 00:29:40.559
of miners in the US voluntarily curtailed their operations. I
484
00:29:40.640 --> 00:29:45.200
say voluntarily, but it's kind of was an obligation and
485
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in some cases a contractual requirement for them. And this
486
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is because you know, the US is very developed jurisdiction
487
00:29:55.079 --> 00:29:56.680
for this type of thing, and they said, look, yeah,
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very welcome to set up your operation here, but if
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there is ever a a natural disaster that requires this power,
490
00:30:02.799 --> 00:30:05.559
we're going to divert it to domestic and civil use,
491
00:30:06.000 --> 00:30:08.920
and that is exactly what's happened. So these miners are
492
00:30:08.920 --> 00:30:13.359
acting responsibly and in a way that is expected of them.
493
00:30:13.960 --> 00:30:17.119
And if you're this will be the norm, you know,
494
00:30:17.599 --> 00:30:21.160
as everything we're talking about is really integrating these mining
495
00:30:21.200 --> 00:30:24.920
operations into the local community and working in harmony with it.
496
00:30:25.839 --> 00:30:29.400
And it be quite It's very easy to regulate, you know,
497
00:30:30.599 --> 00:30:32.720
Like you say, they're big businesses. They're not small little
498
00:30:32.799 --> 00:30:36.039
shops anymore. They are like they're you know, data centers
499
00:30:36.079 --> 00:30:39.640
that that's easy to identify and pinpoint and to oblige
500
00:30:39.680 --> 00:30:44.640
them to act harmlessly. And if you're going to do that,
501
00:30:44.720 --> 00:30:46.440
why not shout about it? You know, I think these
502
00:30:46.440 --> 00:30:48.920
miners should be very proud of what they're doing. Whether
503
00:30:48.920 --> 00:30:52.359
they're using renewables or not, they're still working with the
504
00:30:52.400 --> 00:30:56.480
community to provide disaster relief and yet and if you're
505
00:30:56.480 --> 00:30:58.920
doing that, let's shout about it. Let's get certified and
506
00:30:59.359 --> 00:31:03.319
let everyone everyone be part of that. The other the
507
00:31:03.400 --> 00:31:05.960
kind of final note I would end on is investment.
508
00:31:06.519 --> 00:31:08.759
So if you're wanting to attract more investment in your
509
00:31:08.759 --> 00:31:11.079
mining operation, this is a great way to do it.
510
00:31:11.119 --> 00:31:14.160
Because you can say, look, we are going to, for example,
511
00:31:14.839 --> 00:31:19.960
set up a new bitcoin mining operation in a poorly
512
00:31:20.119 --> 00:31:26.599
served power community in Sub Saharan Africa, and by investing
513
00:31:26.599 --> 00:31:30.200
in this bitcoin mind you're going to help pour money
514
00:31:30.200 --> 00:31:33.839
into the local energy supplier and help regulate the grid
515
00:31:34.119 --> 00:31:36.839
and bring power to these communities. And there's a company
516
00:31:36.839 --> 00:31:40.359
that specializes this called Gridless in Sub Saharan Africa, and
517
00:31:40.400 --> 00:31:44.480
they've estimated they've they've lifted over twenty eight thousand people
518
00:31:44.480 --> 00:31:48.160
out of fuel poverty by doing this. So I'd say
519
00:31:48.240 --> 00:31:50.279
it's also a way to attract investment.
520
00:31:51.160 --> 00:31:54.720
Yeah, it is definitely an investment attraction program within in itself,
521
00:31:55.119 --> 00:32:00.000
and I think it is also it's the onely controversial
522
00:32:00.079 --> 00:32:05.039
by saying that, But they didn't just lift people out
523
00:32:05.079 --> 00:32:09.359
of fuel and energy poverty, but prevented further energy colonialism
524
00:32:10.000 --> 00:32:13.799
because you know, you set up bitcoin mining on your
525
00:32:13.880 --> 00:32:19.000
natural resources in an indigenous area or in a local community,
526
00:32:19.359 --> 00:32:24.359
then you know you're consuming that resource, you're preventing from
527
00:32:24.400 --> 00:32:28.200
further exploitation. No longer are you desperate for external funding
528
00:32:29.920 --> 00:32:34.519
or external powers to come and exploit your resources off
529
00:32:34.559 --> 00:32:37.000
the backs of your people. So I think bitcoin is
530
00:32:37.039 --> 00:32:40.359
a real bitcoin mining. It's a real case for you know,
531
00:32:40.440 --> 00:32:45.839
preventing energy poverty and nearly eliminating and eliminating it in
532
00:32:45.920 --> 00:32:50.319
certain countries where they can now build natural wealth again,
533
00:32:50.839 --> 00:32:55.200
right and not have to exploit natural resources to external
534
00:32:55.240 --> 00:32:59.440
powers or ex or be desperate for external funding for
535
00:32:59.519 --> 00:33:02.359
the purpose of building their local economy because now there's
536
00:33:02.359 --> 00:33:05.279
a way to monetize that natural resource without having to
537
00:33:05.319 --> 00:33:10.680
build expensive infrastructures and relying on all that you know, external.
538
00:33:10.240 --> 00:33:11.200
Debt to make it happen.
539
00:33:11.519 --> 00:33:15.240
Then you and debt your country for you know, tens
540
00:33:15.359 --> 00:33:19.200
or hundreds of years two third parties and never get
541
00:33:19.200 --> 00:33:19.559
out of it.
542
00:33:21.039 --> 00:33:23.079
And I'm hoping that.
543
00:33:23.039 --> 00:33:28.359
One day, you know, large institutions start, you know, there are,
544
00:33:28.960 --> 00:33:31.759
but I think not enough on a on a on
545
00:33:31.799 --> 00:33:35.279
a government scale to fund this infrastructure, you know, this
546
00:33:35.319 --> 00:33:38.880
bitcoin mining infrastructure, not just for the sake of bitcoin mining,
547
00:33:38.920 --> 00:33:40.240
but for the sake of everything.
548
00:33:39.920 --> 00:33:43.960
We discussed on on on this episode. You know.
549
00:33:44.000 --> 00:33:47.119
Oh, and if you have any last words, please go ahead,
550
00:33:47.160 --> 00:33:49.200
But I really thank you for being on the show,
551
00:33:49.920 --> 00:33:54.119
for supporting us, you know, in in in this in
552
00:33:54.160 --> 00:33:58.440
this segment, and uh, you know, being part of the
553
00:33:58.480 --> 00:34:00.559
growth that we're experiencing right now.
554
00:34:01.960 --> 00:34:03.559
Thank you very much, Mo, It's been a pleasure to
555
00:34:03.599 --> 00:34:05.839
talk with you. And yeah, please, if you're interested to
556
00:34:05.880 --> 00:34:08.679
learn more, come visit us at bitroots dot io. You
557
00:34:08.719 --> 00:34:10.599
can message me directly as well. I love to talk
558
00:34:10.639 --> 00:34:13.199
about this and I hope it will st interest to
559
00:34:13.239 --> 00:34:14.159
your audience as well.
560
00:34:14.400 --> 00:34:16.960
Thank you, Owen, thanks for drilling into crypto with us.
561
00:34:17.079 --> 00:34:19.360
If you enjoyed our discussion, please give us a like
562
00:34:19.400 --> 00:34:22.320
on your podcast app or social media, and don't forget
563
00:34:22.320 --> 00:34:25.320
to subscribe. Join us next time, when we will deliver
564
00:34:25.599 --> 00:34:29.360
more perspectives on crypto, asset mining, energy markets, and the
565
00:34:29.400 --> 00:34:30.840
global financial revolution.
1
00:00:00.120 --> 00:00:03.480
Welcome to Drilling into Crypto. I'm your host, Mohammed al Masri.
2
00:00:03.919 --> 00:00:06.040
Every week I speak to the leaders that are driving
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00:00:06.040 --> 00:00:09.960
the global financial revolution. Drilling into Crypto puts the spotlight
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00:00:10.000 --> 00:00:13.359
on the importance of crypto assets on energy markets and
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on global monetary policy.
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00:00:15.679 --> 00:00:18.320
Great we have Owen with us from Bitroots. Thank you
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00:00:18.399 --> 00:00:21.359
for joining Drilling into Crypto. Owen, how are you today?
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00:00:22.320 --> 00:00:24.079
Yes, very good, Mo, how are you?
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00:00:24.600 --> 00:00:25.640
I'm very well. Thank you.
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00:00:26.760 --> 00:00:29.760
I'd like to start off, as every episode that to
11
00:00:31.000 --> 00:00:36.880
ask you about yourself, mainly about your journey you what
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00:00:36.920 --> 00:00:41.200
you were doing before bitroots and before finding bitcoin, and
13
00:00:41.560 --> 00:00:42.920
how you ventured into the space.
14
00:00:44.520 --> 00:00:44.719
Yeah.
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I love this question because I think everyone has their
16
00:00:47.719 --> 00:00:50.679
own journey into bitcoin and it's all unique and use
17
00:00:50.719 --> 00:00:55.399
it from a very wide variety of industries. In my case,
18
00:00:55.479 --> 00:00:59.560
it was from academia, so specifically mathematics. I studied a
19
00:00:59.640 --> 00:01:02.520
PhD in mathematics, and I wanted to be a professor,
20
00:01:02.560 --> 00:01:05.480
you know, with like the tweet jacket and leather arm patches.
21
00:01:05.560 --> 00:01:09.959
But that future wasn't looking so great when you look
22
00:01:10.000 --> 00:01:12.799
at the hours you have to work and the conditions
23
00:01:12.840 --> 00:01:15.000
you have to work in. So I was looking to
24
00:01:15.040 --> 00:01:18.400
switch to something different. And I had a friend who
25
00:01:18.439 --> 00:01:20.959
was working for a bitcoin R and D company and
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00:01:21.040 --> 00:01:24.239
he said, oh, I think you might be well placed
27
00:01:24.280 --> 00:01:26.799
to come and join us here. And that was two
28
00:01:26.879 --> 00:01:30.439
thousand and eighteen, and I didn't know anything about bitcoin
29
00:01:30.480 --> 00:01:32.640
at the time. I mean, i'd heard of it. I
30
00:01:32.680 --> 00:01:36.000
was curious about it at that time. It had both
31
00:01:36.000 --> 00:01:39.280
a positive and quite a negative reputation, but I thought,
32
00:01:39.280 --> 00:01:41.959
why not give it a go? And some of the
33
00:01:42.560 --> 00:01:46.120
geometry I'd studied is actually relevant to bitcoin, And this
34
00:01:46.560 --> 00:01:48.359
was actually a surprise to me. I didn't realize that.
35
00:01:48.480 --> 00:01:52.159
But the cryptography in bitcoin, in the signature scheme is
36
00:01:52.159 --> 00:01:55.280
based on something called elliptic curves, and these are a
37
00:01:55.280 --> 00:01:59.560
geometrical construction that I studied well on the pure mathematics side,
38
00:01:59.719 --> 00:02:01.799
So that that was my kind of technical link to
39
00:02:02.719 --> 00:02:07.000
bitcoin and cryptography. And I spent seven years leading an
40
00:02:07.079 --> 00:02:09.680
R and D team there doing research in how to
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00:02:11.000 --> 00:02:13.479
scale the technology, how to use it in a way
42
00:02:13.520 --> 00:02:16.199
that's both user friendly and private, a lot of cryptography.
43
00:02:16.240 --> 00:02:20.120
So published a lot of papers in cryptography. But around
44
00:02:20.159 --> 00:02:22.919
a year ago I was looking to buy some bitcoin,
45
00:02:23.120 --> 00:02:26.520
and I knew the I know the industry very well
46
00:02:26.560 --> 00:02:28.240
and I knew that a lot of miners were now
47
00:02:28.319 --> 00:02:32.280
using renewable energy, primarily because it's just the cheapest form
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00:02:32.319 --> 00:02:36.520
of energy and it's intermittent, and bitcoin mining couples very
49
00:02:36.560 --> 00:02:38.280
well with that because you can turn it off and
50
00:02:38.319 --> 00:02:40.960
on very quickly, you can co locate to the mining source,
51
00:02:41.039 --> 00:02:44.759
and so on. So I wanted to buy some sustainably
52
00:02:44.759 --> 00:02:48.439
mind bitcoin directly from these miners, but it just wasn't possible.
53
00:02:48.560 --> 00:02:51.759
It wasn't although I knew who the miners were, they
54
00:02:51.759 --> 00:02:55.120
were just selling their coins on exchanges and the coins
55
00:02:55.120 --> 00:02:57.960
weren't in any way linked to them after they were sold.
56
00:02:58.560 --> 00:03:01.199
So I thought, this is this isn't right. You know,
57
00:03:01.240 --> 00:03:04.199
I would really be very I want these coins directly
58
00:03:04.240 --> 00:03:06.879
from them. I'd be very proud to own them knowing
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00:03:06.919 --> 00:03:12.840
that my purchase had gone to help renewable infrastructure financing
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00:03:13.360 --> 00:03:16.919
and other forms of sustainable development. So that's why I
61
00:03:17.240 --> 00:03:21.080
founded bitroots, which is to really our mission is to
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00:03:21.120 --> 00:03:25.159
transform bitcoin mining into an ESG tool. I mean, many
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miners are doing this already, but it's allowing additional revenue
64
00:03:29.800 --> 00:03:32.479
streams for them by matching them with the people who
65
00:03:32.520 --> 00:03:36.000
want these coins. So you might be a family office
66
00:03:36.000 --> 00:03:40.199
who have certain ESG principles. You might be a fund
67
00:03:40.240 --> 00:03:42.680
or a treasury who wants to make sure your assets
68
00:03:42.680 --> 00:03:45.240
are sustainable, or you might be a defied platform. You
69
00:03:45.319 --> 00:03:48.280
might want to do lending and staking using bitcoin and
70
00:03:48.319 --> 00:03:51.199
you want to have that powered by something that is sustainable.
71
00:03:51.560 --> 00:03:53.919
So what we do is match those buyers with the
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00:03:54.599 --> 00:03:57.560
miners who are using sustainable energy so that you know
73
00:03:57.919 --> 00:04:00.479
your coin has come from one of these sources. And
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00:04:00.560 --> 00:04:02.719
what we do at bit roots we provide the assurance
75
00:04:02.719 --> 00:04:06.840
of that. So we have a certification scheme that tells you, yes,
76
00:04:06.879 --> 00:04:09.840
this coin was mined by this miner using this energy.
77
00:04:10.199 --> 00:04:11.919
And you can really think of this as the world's
78
00:04:11.960 --> 00:04:16.040
first provenance platform for bitcoin, so we can tell you
79
00:04:16.040 --> 00:04:17.279
where your bitcoin comes from.
80
00:04:21.279 --> 00:04:24.079
That's beautiful. So definitely.
81
00:04:25.360 --> 00:04:29.759
A concept that's been around for some time, but I
82
00:04:29.759 --> 00:04:36.680
haven't seen anyone actually adopted in a formal certification fashion
83
00:04:37.199 --> 00:04:42.959
on the blockchain that is mutable, transparent, and that follows
84
00:04:43.120 --> 00:04:50.920
through with the mind bitcoin from its stage of minting
85
00:04:51.040 --> 00:04:56.519
up until the and throughout the process of it going
86
00:04:56.560 --> 00:04:59.319
onto the market. Now, after it goes onto the market,
87
00:05:00.319 --> 00:05:04.560
in that coin starts treating, does that certificate continue to
88
00:05:04.600 --> 00:05:06.120
follow that coin on the Ledger.
89
00:05:07.279 --> 00:05:09.360
Yeah, that's exactly right, MO. So I call that the
90
00:05:09.360 --> 00:05:12.639
secondary market. So the primary market is the miners selling
91
00:05:12.639 --> 00:05:16.519
their coins directly to the first buyer, and this does
92
00:05:16.600 --> 00:05:18.480
happen in an ad hoc way, like I do know
93
00:05:18.959 --> 00:05:22.800
some large buyers who are getting these sustainabley Mind coins,
94
00:05:23.319 --> 00:05:25.800
but the problem comes when they want to sell them onwards,
95
00:05:25.879 --> 00:05:29.279
they have no proof that they went to all these
96
00:05:29.399 --> 00:05:33.639
lengths to get these sustainable coins. That's where our certification
97
00:05:33.839 --> 00:05:37.759
tracking software really comes into play, so that when if
98
00:05:37.800 --> 00:05:40.000
you purchase one of these coins and you want to
99
00:05:40.040 --> 00:05:42.800
sell it on in the future, you have that continuous
100
00:05:42.839 --> 00:05:46.519
record of provenance from a sustainable minor. So you can
101
00:05:46.560 --> 00:05:48.639
think of what we're trying to do as and make
102
00:05:48.639 --> 00:05:50.240
this a mature secondary market.
103
00:05:52.160 --> 00:05:55.800
And that's interesting because then you can find an alternative
104
00:05:55.839 --> 00:05:57.720
to voluntary carbon credits.
105
00:05:58.839 --> 00:05:59.639
Yes, so.
106
00:06:01.879 --> 00:06:04.680
My limited understanding on carbon credit markets, but I know
107
00:06:04.720 --> 00:06:08.319
there are two markets, right, the official one which is
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trillions of dollars in volume and then or maybe close
109
00:06:12.920 --> 00:06:15.199
to a trillion, and then the other one which is
110
00:06:15.240 --> 00:06:20.120
a few billion dollars in right, so that that the
111
00:06:22.079 --> 00:06:26.560
the two or three billion dollar voluntary carbon credit market.
112
00:06:27.240 --> 00:06:29.720
Is what they call it. I believe I think that
113
00:06:29.720 --> 00:06:31.959
that is a niche that or that is a market
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00:06:32.000 --> 00:06:36.839
that I that this solution could tap into and provide
115
00:06:37.240 --> 00:06:44.279
more credibility, more returns from a financial perspective, and real
116
00:06:44.319 --> 00:06:49.560
world ESG use cases that actually adopt real technology, physical
117
00:06:50.120 --> 00:06:55.319
infrastructure for compute that ultimately not just benefits the energy
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00:06:55.360 --> 00:06:56.319
asset itself, but.
119
00:06:57.959 --> 00:07:00.399
The the community around on it.
120
00:07:00.879 --> 00:07:03.759
Right, Yep, that's a social part of the ESG.
121
00:07:04.120 --> 00:07:09.720
Yes, that that monetary aspect or that financial aspect of
122
00:07:10.439 --> 00:07:13.920
the mining operation could then be invested back into these
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00:07:13.959 --> 00:07:18.759
communities with and if it were to be sold, then
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you might be able to get a premium on it.
125
00:07:20.519 --> 00:07:22.759
So all these things linger in my mind when you're
126
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when you're explaining that if you can touch on some
127
00:07:26.040 --> 00:07:27.839
of these things that I mentioned, that would be really
128
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interesting for us to understand.
129
00:07:32.000 --> 00:07:34.199
I can give you a very concrete example about how
130
00:07:34.240 --> 00:07:37.079
this is providing a social benefit. But first I've just
131
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mentioned carbon credits. So I love carbon credits, especially the
132
00:07:39.920 --> 00:07:43.000
voluntary ones, because I see this as you know, a
133
00:07:43.040 --> 00:07:46.759
lot of people, a lot of organizations trying really hard
134
00:07:46.920 --> 00:07:51.079
to make sure that they are carbon neutral by purchasing
135
00:07:51.079 --> 00:07:54.040
these credits. But what we can do is actually go
136
00:07:54.120 --> 00:07:57.639
one step further and say, okay, instead of purchasing an
137
00:07:57.639 --> 00:08:00.399
asset and then buying a carbon credit to off the
138
00:08:00.839 --> 00:08:04.399
impact of that, we can give you assets that didn't
139
00:08:04.439 --> 00:08:07.160
cause any emissions to begin with. So we can say
140
00:08:07.160 --> 00:08:10.920
to you, these bitcoins did not cause any emissions in
141
00:08:10.920 --> 00:08:14.920
the process. Because it's worth always remembering bitcoin mining is
142
00:08:14.959 --> 00:08:19.759
a completely clean technology. So the mining operations themselves, they're
143
00:08:19.800 --> 00:08:23.680
just data centers. They take electricity and the only output
144
00:08:23.800 --> 00:08:27.920
you get is bitcoins and heat. That's it. There's absolutely
145
00:08:28.000 --> 00:08:31.360
zero pollution involved in that. And then if your energy
146
00:08:31.399 --> 00:08:36.120
source is sustainable, is renewable, then that whole process is
147
00:08:36.240 --> 00:08:38.639
emission free. So what we can say to people is,
148
00:08:39.039 --> 00:08:41.240
here are some bitcoins that didn't cause any emissions to
149
00:08:41.279 --> 00:08:44.480
begin with, so no need to purchase carbon credits. So
150
00:08:44.519 --> 00:08:47.279
that's quite a compelling value proposition if you want to
151
00:08:47.279 --> 00:08:51.159
help directly incentivize emission reduction before you.
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Move on that. As that reminds me of.
153
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I do work on the Financial Advisory Site or Energy
154
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to Cope projects, and we do work on the renewable
155
00:09:03.639 --> 00:09:06.519
side as well. Some of the discussions that came up
156
00:09:06.519 --> 00:09:08.799
from external bonders.
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Were who's going to off take this energy?
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Right?
159
00:09:14.480 --> 00:09:18.960
And our business revolves around energy to compute, so trying
160
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to monetize renewable energy sources or subsidized power or idle
161
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and wasted energy. And when you bring up the point
162
00:09:29.120 --> 00:09:32.200
that bitcoin minors will be the off takers of first
163
00:09:32.240 --> 00:09:37.000
and last resort for the purpose of early monetization on
164
00:09:37.080 --> 00:09:42.440
the asset until there's a grid tie and austral or
165
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commercial use case. But they start to ask questions like,
166
00:09:49.919 --> 00:09:53.720
but this doesn't benefit the country of origin, right or
167
00:09:53.799 --> 00:09:57.159
the community where this project is being built. But I
168
00:09:57.159 --> 00:09:59.919
think what you just mentioned about, you know, the is
169
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angle is a good rebuttal how would you answer such
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a question.
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Oh, I'll answer that with a very concrete example in
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that's operational right now in Ethiopia. So you may be
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aware of the Grand Renaissance Dam. It's the largest hydro
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dam in Africa. It's only just been finished when operational
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last year. And in Ethiopia they have a grid that's fragmented,
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so not every community, particularly the rural communities, can get
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access to the electricity generated by this dam, which has
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twice as much as the country you will ever need.
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So what they did is they were quite progressive. They
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invited the bitcoin mining community to come along and to
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purchase this energy, to off take this energy that would
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otherwise be wasted. And in twenty twenty five, the Ethiopia
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Electric Authority generated over two hundred million dollars by selling
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their excess, completely excess electricity to bitcoin miners. And they
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use this directly to install power lines to connect these
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rural communities, which ultimately lifted people out of fuel poverty.
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So this is where when I heard about this, I
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was just blown away and I thought I have to
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get involved. So I personally invested in a mining operation
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in Ethiopia. And I'm really proud of this, of the
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story behind these coins. So when I mind my coins,
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I'm not only happy because there are one hundred percent
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sustainable from a hydro dam, but they are also helping
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lift people out of fuel poverty, and I just think
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that's such a great story that I'm really proud of.
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And I want other people to be able to get
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access to these type of coins if they want to
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invest in bitcoin, but choose to do so in something
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that has an ESG impact. That's what I want to enable,
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and that's ultimately what I'm trying to achieve at bit roots.
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That's beautiful.
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So that's very concrete.
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Yeah, I love I love it, and it's just you know,
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exactly where where this is going. And when I mean this,
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I mean the bitcoin mining industry. The energy to compute
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transition is you know, it comes with a purpose, and
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I believe there are at least, you know, I'd like
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to believe that there are still quite a few of
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us that are mission driven and purpose driven and still
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want to do this for the betterment of society.
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Uh.
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But living in a globalized capitalistic world or a globalized
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world that does adopt you know, the essence of capitalism,
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which could be a good thing if put to good use,
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there's still that angle of you know, above average it's
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a don't usually like to use that word when speaking
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about investments, but above average returns or never sometimes never
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before seeing returns depending on what the network effects are
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at the time and how the market is performing.
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So you know, it does capture the entire esg.
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Essence, and there is that alternative investment asset class that's
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still widely untapped by you know, institutions and investors. So yeah,
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really interesting stuff this bitcoin, if certified in that fashion,
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could have a premium at some point in time once
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this market is adopted.
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Yes, it does have a premium. So it's similar to
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this concept already exists in many markets, for example the
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gold market and diamond markets. So nowadays with diamonds, you
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can't buy a diamond anymore at a retail outlet that
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doesn't come with a certificate assuring you that this diamond
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was mined ethically, and there are a scheme called I
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think it's called Sustainable Mind diamonds. And in the gold
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industry another scheme exists. It's called fair Mind Gold. So
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if you are a gold mine and you have very
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good ethical and environmental standards, then you invite fair Mind
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to come along and inspect your facility and they will
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give you a certificate, and your gold trades at a
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premium that's around two to four percent premium. Now, I
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suspect we'll see something similar, possibly a bit more for bitcoin.
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At the moment and in the future, we just don't
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know what that will be priced at. I happen to
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think it might be priced a much higher premium because
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we have the assurance of where this has come from
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and when I talk to people particularly, you know, for example,
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I has had a very nice conference in London last
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week called Crypto for Good, and I explained to them,
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citing the example in Ethiopia. People just haven't heard this,
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and when they do, their eyes light up. This is
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this is fantastic, this is yes, I want these bitcoins,
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you know, I now no longer just want to buy
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them off in exchange.
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Makes you think that it's such an obvious thing to know,
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but you realize there are so many people that don't
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know about it. That's when the light bulb comes out. Okay,
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there's still a lot of work to do, there's still
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a market there.
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Don't lose hope.
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But because you're in the industry, sometimes you feel like
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it's it's so obvious, everyone knows it, so it seems
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like no one's interested.
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But actually a lot of people with the interested. You
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just got to get in front of them.
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And Yeah, I believe that premium will eventually catch on because.
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It just from my perspective, it would.
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Make more sense to buy a certified or e is
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she certified bitcoin versus just a standalone carbon credit.
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Yeah, and it might. You might look at it in
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terms of risk if you're in an industry that has
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strong regulations on this type of thing, it's just less
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risky asset. Also from the perspective of risk from previous
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coin holders. So for example, there are certain funds well
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actually I think a lot of them, a lot of
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the like the ETFs, they have a policy of transparently
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disclosing their their assets. Usually you have to be at
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a high enough level of investment to get that information.
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And they whenever they purchase a bitcoin, they they screen it,
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they check it a certain amount of hops of previous
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owners because if that was ever associated with the proceeds
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of crime, then that bitcoin will there's a there's a
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risk to them that they would have to could be confiscated.
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There's not just bitcoin. Of course, this happens in the
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art world. Having with a Picasso painting at Christie's last year,
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that was a really interesting one where the person who
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purchased it sued Christie's because they said, you you you did,
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you could have told us more information about the previous
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owner of this painting and we could have avoided doing
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something untoward there. So it's not just big going that.
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This effects is every asset and if you get it
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directly from the source, from the miners. You know, there's
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no there's this less risk because there's less history involved.
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So not only that's the kind of governance aspect of it.
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So these coins are particularly valuable to to people who
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are trying to sell exposure to them, like funds, like
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lending and staking platforms.
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Yeah, I see a wider adoption even on regulatory compliance
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level for environmental relators and environmental authorities. Right for example,
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in Alberta, we have the carbon tax right a certain
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extent based on certain emissions thresholds for for for power plants.
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And energy producers.
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And you know, you're you're you can offset your carbon
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tax with carbon credits, buy them off the market. And
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you know, some of these energy producers that have excess
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energy or enough energy to mine their own bitcoin, you know,
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whether it's capturing flare gas and and and you know,
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instead of flaring then you're generating power mining bitcoin and
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having a certified ESG certified bitcoin on your books. If
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only we were in a position or there maybe there
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must be some work you and I will need to
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do to convince the you know, federal and or provincial
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governments and the regulatory authorities to accept ESG certified bitcoin
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just as they would carbon credits for the purpose of
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offsetting carbon tax.
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Right absolutely, I think I.
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Think there's a much wider adoption for this.
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That is, and and you know, as as as mature
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we might think it is, it's still very early.
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Well, so I love the use case of flare gas
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because this is where bitcoin mining is not only carbon neutral,
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it's carbon negative. So this is preventing wasted methane being
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released into the atmosphere by instead turning that into energy
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to mine bitcoin, which reduces the amount that is released.
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So you know, not only is it carbon are those
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coins carbon neutral? They're carbon negative. You just give me
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a kind of a great idea there. You could think
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of them as a carbon credit. If you own these bitcoin,
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you have offset this amount of carbon. So there you go.
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That is a problem that exists today in certain countries
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and the provinces and states. It's a burden on investors
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or actually it's not a it's a burden on the
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operators and also a it it it turns away investors
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like foreign direct investments because of carbon tax could really
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kill a project's economics. So so these are these are
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things that I think you know, bitcoin could optimize assets,
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could optimize treasury.
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Uh.
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It just transforms your energy asset if it were stranded
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or wasted, into.
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A valuable.
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Produce cash flow producing asset which which just goes a
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long way. So this is really amazing. Yeah. I want
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to learn more about this, uh and and and apply
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real world use cases to it. But tell me more
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about you know, how did that certification of bitcoin come
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to mind? But when was that Eureka moment for you?
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When was that.
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Aha moment that allowed you to Yeah, this.
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Was I was thinking about, as I say, purchase these
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coins directly from a minor, and then I was I
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thought to myself, well, when I come to sell these coins,
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I want a record by a certificate of where I
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got them from and the power that was used.
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And why did you think about wanting that record? Is
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it because of your own values or something sparked that
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thought that my bitcoin should be clean.
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I it was my own values. So I thought, if
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everything being equal, I would prefer a bitcoin that I
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knew had come from renewable. And then I thought, well,
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I would also like to show that to people. You know,
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I want to be proud of it. I want to
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show it off. How can I do that, you know,
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other than how I let people into the research that
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I've done into acquiring this coin, and you can capture
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that in a document which is essentially a certificate. And
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because I've done a lot of R and D about
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the you know, the protocol transactions to how they're linked together,
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I knew how that tracking element would work. So you've
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got to be careful if I have, like, let's say,
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a certify coin, not to mix that with an uncertified coin.
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Because we know that bitcoin is fungible on a stical level.
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These still are, so we don't we wouldn't write any
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data to the chain. You know, a bitcoin is still
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a bitcoin on the ledger, so you could mix these up,
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So you have to be careful not to do that
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if you want to easily trick it. But I actually
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I knew more sophisticated methods to track the provenance of
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your bitcoins. So there's a protocol called ordinals, and some
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people know this through an nft craze called Ordinal inscriptions.
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I don't have any comment on that, but ordinals as
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a concept is simply a way to identify every stoce
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when it was minted onto the ledger and to track
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it throughout its lifetime as it's traded on the ledger.
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And that was a missing piece of the puzzle. It
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meant that, well, okay, once I can identify the coins
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when they were first minute, once I can associate them
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with this particular sustainable mining operation, I then also have
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a method to track them throughout their whole lifetime as
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they're traded on the ledger. And you put those things
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together and you get a very strong process of a
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method for establishing the provenance of every single cetoce.
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Are attached to the coin that's mine right now.
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I'm not No, I'm not attaching any NFTs because I'm
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not using the I'm not using ordinal inscriptions, which is
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an NFT protocol. But ordinal theory is simply a method
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to order every satoshi. That's why they're called ordinals. So
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I'm using that methodology to track Satoce's nothing to do
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with NFT. So it's kind of using the same underlying theory.
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See so on the ledger, and what does it show
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certified coins.
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On the ledger? You will not see anything. You will
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just see nor bitcoins being traded. So ordinals don't require
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ordinar theory doesn't require you to write any data to
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the chain. That's why it's such a cool and useful.
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How can someone identify that this is a certified.
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Oh by additional data. So let's say I was to
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say to you this utxo is a certified coin. I
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will also give you the certificate that says so. And
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if you trade that with someone else, then everything is
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linked together because every transaction is linked to the previous transaction,
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so you can just go back until you find the
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certificate of origin. So it's almost like a birth certificate.
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I kind of think of it.
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Sometimes data sets better access, like via API.
413
00:24:41.359 --> 00:24:44.359
Yes, yeah, we have an API to certify, also a
414
00:24:44.400 --> 00:24:46.880
manual verification if you want to go on our website
415
00:24:46.880 --> 00:24:47.160
as well.
416
00:24:47.240 --> 00:24:51.880
Is that propriet theory or is that.
417
00:24:50.480 --> 00:24:52.240
That's proprietary big software?
418
00:24:52.279 --> 00:24:58.759
YEA very nice, but I must say the the fascinating stuff.
419
00:24:59.440 --> 00:25:02.480
This is a thank you very much and I'd love
420
00:25:02.519 --> 00:25:04.880
to follow up with you about it as well, because
421
00:25:04.920 --> 00:25:09.440
we are we are now rolling out this and we're
422
00:25:09.440 --> 00:25:12.519
looking for miners who want to be on boarded, who
423
00:25:12.519 --> 00:25:14.160
are very proud of what they do and want to
424
00:25:14.200 --> 00:25:17.640
get access to these premium markets and similarly to the
425
00:25:17.720 --> 00:25:20.240
people who want these coins. You know, our order book
426
00:25:20.319 --> 00:25:25.279
is open. So if you are individual fund the DeFi
427
00:25:25.400 --> 00:25:28.839
platform that wants to be powered by sustainable bitcoin, please
428
00:25:28.880 --> 00:25:30.240
come and talk to us and we will put you
429
00:25:30.279 --> 00:25:32.880
in touch with the miners.
430
00:25:33.680 --> 00:25:34.359
Yeah, I love it.
431
00:25:35.960 --> 00:25:41.480
Anything else you'd like to touch on, you know, because
432
00:25:41.519 --> 00:25:44.559
we we we look that environmental, we look at social
433
00:25:45.079 --> 00:25:52.200
governance pretty much, you know, presented real world use cases
434
00:25:52.319 --> 00:25:56.359
that some you've been part of and have skin in
435
00:25:56.400 --> 00:25:57.559
the game, mum.
436
00:25:59.039 --> 00:26:05.119
And you know how important is it for minors?
437
00:26:05.559 --> 00:26:09.880
You know, because not all miners are adopting you know,
438
00:26:09.960 --> 00:26:14.640
these values within their operations or these principles within within
439
00:26:14.680 --> 00:26:15.880
their business in general?
440
00:26:16.839 --> 00:26:18.000
How important is it.
441
00:26:17.960 --> 00:26:24.440
For minors too A certify their bitcoin and ensure that
442
00:26:24.599 --> 00:26:31.079
bitcoin operates on clean and or you know, renewable slash
443
00:26:31.160 --> 00:26:37.960
alternative energy you know, where carbons either emitted prevented, it's
444
00:26:37.960 --> 00:26:42.640
it's either captured, prevented AH or mitigated.
445
00:26:42.799 --> 00:26:43.160
Uh.
446
00:26:44.000 --> 00:26:47.039
You know, so how important is it for for these
447
00:26:47.079 --> 00:26:50.920
miners to do that? I know you're your answers. It's
448
00:26:51.000 --> 00:26:54.599
very important, and you know there's an obvious reason why,
449
00:26:55.119 --> 00:27:00.440
but I want to look at it more from a
450
00:27:00.480 --> 00:27:04.920
community standpoint, and I'd like to know your perspective, you know,
451
00:27:05.599 --> 00:27:10.720
politically about this, because bitcoin miners are not just bitcoin
452
00:27:10.839 --> 00:27:17.400
miners in my perspective, they're they're operating a new monetary
453
00:27:18.200 --> 00:27:22.720
system or new monetary network HM new compared to the
454
00:27:22.720 --> 00:27:26.880
Fiat one that we have. But and and they're contributing
455
00:27:26.920 --> 00:27:31.640
to a network that's widely adopted by hundreds of millions
456
00:27:31.640 --> 00:27:37.119
of people, with over two trillion dollars in market cap.
457
00:27:37.720 --> 00:27:46.119
And it's no longer a game played by developers' basement, right,
458
00:27:46.200 --> 00:27:51.160
It's it's it's worldwide, it's institutional, it's backed by sovereigns,
459
00:27:51.480 --> 00:27:57.839
by governments, by state backed corporations, all adopting bitcoin mining
460
00:27:57.920 --> 00:28:03.119
as infrastructure for energy monetization and power grid stability and
461
00:28:03.200 --> 00:28:08.359
load balancing. In addition to you know, their their their
462
00:28:08.359 --> 00:28:12.119
own FX reasons right or foreign currencies.
463
00:28:15.680 --> 00:28:19.160
All that makes it, you know, much more.
464
00:28:19.000 --> 00:28:25.079
Important to have a proper proper governance around around bitcoins
465
00:28:25.759 --> 00:28:33.839
ESG compliance so in you know, within sixty seconds or more,
466
00:28:33.880 --> 00:28:37.160
if you want to just give us your perspective on
467
00:28:37.759 --> 00:28:44.119
the political importance of bitcoin minors, mainly mainly and you know,
468
00:28:44.559 --> 00:28:47.759
I want to put them on the spot public miners.
469
00:28:48.240 --> 00:28:53.440
Yeah, yeah, okay, I would say it's we're what we're
470
00:28:53.440 --> 00:28:55.440
talking really is about responsible mining.
471
00:28:55.480 --> 00:28:55.799
I think.
472
00:28:56.279 --> 00:28:58.519
So, I think we're seeing already a shure.
473
00:28:58.559 --> 00:29:02.079
You're so eloquent in simplifying what I'm trying to say.
474
00:29:02.119 --> 00:29:05.200
I'm just chaos in my brain, actually, but thank you.
475
00:29:05.519 --> 00:29:08.119
Yeah, no problem. Well, well you're very clear to me,
476
00:29:08.240 --> 00:29:12.279
so and I'm enjoying the conversation. So here's a I
477
00:29:12.319 --> 00:29:15.079
think very soon or already we're seeing a shift into
478
00:29:15.640 --> 00:29:20.400
a right to play for miners is to be responsible
479
00:29:20.640 --> 00:29:24.440
within the community you're in placed. And there's a great
480
00:29:24.480 --> 00:29:28.160
example that's just happened last week. So there were severe
481
00:29:28.160 --> 00:29:31.839
winter storms in the US, and as such, there was
482
00:29:32.000 --> 00:29:35.960
a severe demand on the grid, and a huge portion
483
00:29:36.079 --> 00:29:40.559
of miners in the US voluntarily curtailed their operations. I
484
00:29:40.640 --> 00:29:45.200
say voluntarily, but it's kind of was an obligation and
485
00:29:45.720 --> 00:29:51.200
in some cases a contractual requirement for them. And this
486
00:29:51.240 --> 00:29:55.000
is because you know, the US is very developed jurisdiction
487
00:29:55.079 --> 00:29:56.680
for this type of thing, and they said, look, yeah,
488
00:29:56.960 --> 00:29:59.119
very welcome to set up your operation here, but if
489
00:29:59.119 --> 00:30:02.640
there is ever a a natural disaster that requires this power,
490
00:30:02.799 --> 00:30:05.559
we're going to divert it to domestic and civil use,
491
00:30:06.000 --> 00:30:08.920
and that is exactly what's happened. So these miners are
492
00:30:08.920 --> 00:30:13.359
acting responsibly and in a way that is expected of them.
493
00:30:13.960 --> 00:30:17.119
And if you're this will be the norm, you know,
494
00:30:17.599 --> 00:30:21.160
as everything we're talking about is really integrating these mining
495
00:30:21.200 --> 00:30:24.920
operations into the local community and working in harmony with it.
496
00:30:25.839 --> 00:30:29.400
And it be quite It's very easy to regulate, you know,
497
00:30:30.599 --> 00:30:32.720
Like you say, they're big businesses. They're not small little
498
00:30:32.799 --> 00:30:36.039
shops anymore. They are like they're you know, data centers
499
00:30:36.079 --> 00:30:39.640
that that's easy to identify and pinpoint and to oblige
500
00:30:39.680 --> 00:30:44.640
them to act harmlessly. And if you're going to do that,
501
00:30:44.720 --> 00:30:46.440
why not shout about it? You know, I think these
502
00:30:46.440 --> 00:30:48.920
miners should be very proud of what they're doing. Whether
503
00:30:48.920 --> 00:30:52.359
they're using renewables or not, they're still working with the
504
00:30:52.400 --> 00:30:56.480
community to provide disaster relief and yet and if you're
505
00:30:56.480 --> 00:30:58.920
doing that, let's shout about it. Let's get certified and
506
00:30:59.359 --> 00:31:03.319
let everyone everyone be part of that. The other the
507
00:31:03.400 --> 00:31:05.960
kind of final note I would end on is investment.
508
00:31:06.519 --> 00:31:08.759
So if you're wanting to attract more investment in your
509
00:31:08.759 --> 00:31:11.079
mining operation, this is a great way to do it.
510
00:31:11.119 --> 00:31:14.160
Because you can say, look, we are going to, for example,
511
00:31:14.839 --> 00:31:19.960
set up a new bitcoin mining operation in a poorly
512
00:31:20.119 --> 00:31:26.599
served power community in Sub Saharan Africa, and by investing
513
00:31:26.599 --> 00:31:30.200
in this bitcoin mind you're going to help pour money
514
00:31:30.200 --> 00:31:33.839
into the local energy supplier and help regulate the grid
515
00:31:34.119 --> 00:31:36.839
and bring power to these communities. And there's a company
516
00:31:36.839 --> 00:31:40.359
that specializes this called Gridless in Sub Saharan Africa, and
517
00:31:40.400 --> 00:31:44.480
they've estimated they've they've lifted over twenty eight thousand people
518
00:31:44.480 --> 00:31:48.160
out of fuel poverty by doing this. So I'd say
519
00:31:48.240 --> 00:31:50.279
it's also a way to attract investment.
520
00:31:51.160 --> 00:31:54.720
Yeah, it is definitely an investment attraction program within in itself,
521
00:31:55.119 --> 00:32:00.000
and I think it is also it's the onely controversial
522
00:32:00.079 --> 00:32:05.039
by saying that, But they didn't just lift people out
523
00:32:05.079 --> 00:32:09.359
of fuel and energy poverty, but prevented further energy colonialism
524
00:32:10.000 --> 00:32:13.799
because you know, you set up bitcoin mining on your
525
00:32:13.880 --> 00:32:19.000
natural resources in an indigenous area or in a local community,
526
00:32:19.359 --> 00:32:24.359
then you know you're consuming that resource, you're preventing from
527
00:32:24.400 --> 00:32:28.200
further exploitation. No longer are you desperate for external funding
528
00:32:29.920 --> 00:32:34.519
or external powers to come and exploit your resources off
529
00:32:34.559 --> 00:32:37.000
the backs of your people. So I think bitcoin is
530
00:32:37.039 --> 00:32:40.359
a real bitcoin mining. It's a real case for you know,
531
00:32:40.440 --> 00:32:45.839
preventing energy poverty and nearly eliminating and eliminating it in
532
00:32:45.920 --> 00:32:50.319
certain countries where they can now build natural wealth again,
533
00:32:50.839 --> 00:32:55.200
right and not have to exploit natural resources to external
534
00:32:55.240 --> 00:32:59.440
powers or ex or be desperate for external funding for
535
00:32:59.519 --> 00:33:02.359
the purpose of building their local economy because now there's
536
00:33:02.359 --> 00:33:05.279
a way to monetize that natural resource without having to
537
00:33:05.319 --> 00:33:10.680
build expensive infrastructures and relying on all that you know, external.
538
00:33:10.240 --> 00:33:11.200
Debt to make it happen.
539
00:33:11.519 --> 00:33:15.240
Then you and debt your country for you know, tens
540
00:33:15.359 --> 00:33:19.200
or hundreds of years two third parties and never get
541
00:33:19.200 --> 00:33:19.559
out of it.
542
00:33:21.039 --> 00:33:23.079
And I'm hoping that.
543
00:33:23.039 --> 00:33:28.359
One day, you know, large institutions start, you know, there are,
544
00:33:28.960 --> 00:33:31.759
but I think not enough on a on a on
545
00:33:31.799 --> 00:33:35.279
a government scale to fund this infrastructure, you know, this
546
00:33:35.319 --> 00:33:38.880
bitcoin mining infrastructure, not just for the sake of bitcoin mining,
547
00:33:38.920 --> 00:33:40.240
but for the sake of everything.
548
00:33:39.920 --> 00:33:43.960
We discussed on on on this episode. You know.
549
00:33:44.000 --> 00:33:47.119
Oh, and if you have any last words, please go ahead,
550
00:33:47.160 --> 00:33:49.200
But I really thank you for being on the show,
551
00:33:49.920 --> 00:33:54.119
for supporting us, you know, in in in this in
552
00:33:54.160 --> 00:33:58.440
this segment, and uh, you know, being part of the
553
00:33:58.480 --> 00:34:00.559
growth that we're experiencing right now.
554
00:34:01.960 --> 00:34:03.559
Thank you very much, Mo, It's been a pleasure to
555
00:34:03.599 --> 00:34:05.839
talk with you. And yeah, please, if you're interested to
556
00:34:05.880 --> 00:34:08.679
learn more, come visit us at bitroots dot io. You
557
00:34:08.719 --> 00:34:10.599
can message me directly as well. I love to talk
558
00:34:10.639 --> 00:34:13.199
about this and I hope it will st interest to
559
00:34:13.239 --> 00:34:14.159
your audience as well.
560
00:34:14.400 --> 00:34:16.960
Thank you, Owen, thanks for drilling into crypto with us.
561
00:34:17.079 --> 00:34:19.360
If you enjoyed our discussion, please give us a like
562
00:34:19.400 --> 00:34:22.320
on your podcast app or social media, and don't forget
563
00:34:22.320 --> 00:34:25.320
to subscribe. Join us next time, when we will deliver
564
00:34:25.599 --> 00:34:29.360
more perspectives on crypto, asset mining, energy markets, and the
565
00:34:29.400 --> 00:34:30.840
global financial revolution.
