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How the Blockstream Satellite Will Drive Bitcoin Adoption: An Interview with Adam Back and Chris Cook

Last week eBits.Co eBits the announcement of Blockstream Satellite, a new service that broadcasts real-time Bitcoin blockchain data from satellites in space to almost everyone on the planet. Currently Blockstream Satellite covers across two-thirds of the Earth, and service expansions are in the works.

“Today’s launch of Blockstream Satellite gives even more people on the planet the choice to participate in Bitcoin,” said Blockstream co-founder and CEO Adam Back, when the announcement was made. “With more users accessing the Bitcoin blockchain with the free broadcast from Blockstream Satellite, we expect the global reach to drive more adoption and use cases for Bitcoin, while strengthening the overall robustness of the network.”

The idea of streaming the Bitcoin blockchain to the whole planet from satellites in space had previously been eBits, but Blockstream’s implementation introduces some interesting tweaks: It relies on existing commercial satellites already in orbit and leverages open-source software, namely GNU Radio and FIBRE, to reduce costs.

The announcement of the Blockstream Satellite has been received with considerable interest from both the blockchain and space communities, but also with doubts and lingering questions. eBits.Co reached out to Adam Back and Chris Cook, Head of Satellite at Blockstream, to find out more.


You are essentially using existing commercial satellites as relays. Why is this approach better than building, launching and operating your own satellites, now that cubesats and cheaper cubesat launch systems permit doing so cost effectively?

Chris Cook: While there have been many recent reductions in the cost of cubesats and other low earth orbit (LEO) satellites, it is still a considerably more expensive venture than using existing satellites. As cubesats are not geosynchronous, they are always moving overhead. This means that you need many of them for complete global coverage.

Additionally, many cubesats have a lifetime of only a few months before they fall out of orbit. Either you need to continuously replenish them or you have to boost them into higher orbit, both of which increase costs.

Finally, we have not entirely dismissed the idea of launching our own satellites. However, deploying a global satellite network with existing satellites seemed like a good first step. It allows us to deliver this service to people throughout the world quickly and cost effectively.

What could you do with dedicated custom satellites that you can’t do with the current system?

Chris Cook: A dedicated satellite would potentially enable us to operate a node on a satellite itself rather than [have it be] supported from a ground station.  

What if political pressures force your commercial satellite service providers to cancel your contracts?

Adam Back: Because Bitcoin is already widely used and made available via other means in many countries around the world, the threat of the satellite broadcast of Bitcoin being canceled is not likely. The satellite network is providing redundant, low-cost availability for data that is already publicly available and downloadable by anyone over the internet. There are multiple satellites from different providers in the Blockstream Satellite network.

Related to that, does Blockstream Satellite (or a conceivable extension) permit improving on the privacy and anonymity of bitcoin transactions?

Adam Back: Blockstream Satellite allows passive receipt so there is basically no footprint of internet traffic allowing your ISP or monitoring companies analyzing the Bitcoin network to track your node. This may make it attractive even for users with fast home internet to use Blockstream Satellite, where they can then connect and pin their wallet to their home node via Tor.

For geographies where high-speed internet is expensive or not available, they can connect smartphone wallets over WiFi or meshnet to satellite nodes, and broadcast transactions via SMS gateways such as SMSPushTX, by Pavol Rusnak, or bi-directional Ku or L-band internet services (available commercially and unrelated to Blockstream Satellite) which can be expensive, but even the most expensive at $10/MB works out to less than one US penny per transaction, as Bitcoin transactions are small.

So, I have set up my Blockstream Satellite receiving station. I am not connected to the internet. How do I send a bitcoin payment?

Adam Back: See above via SMS, or often people do have 2.5G or 3G data but at expensive data rates. Because Bitcoin transactions are small, the cost of sending a transaction is small, even if receiving the blockchain would be expensive.

For shared equipment, perhaps for a village or business area, a bi-directional satellite internet is also cost-effective, again because of small Bitcoin transactions. L-band BGAN is mobile, and Ku band [Hughes receivers] are fixed satellite dishes.

Your FAQ says that transactions can be sent using other communication channels such as SMS. Do you operate your own SMS relays for bitcoin transactions or do you recommend using external services? If so, which ones?

Adam Back: We do not at this time operate an SMS gateway but Pavol does (see above). We are working with and encouraging Bitcoin enthusiasts and entrepreneurs to build out custom infrastructure configurations and share setup tips online.

What are some of the innovative “killer apps” that you hope Blockstream Satellite could enable?

Adam Back: We see the Blockstream Satellite service as one stepping stone to decentralizing Bitcoin by radically reducing node cost and therefore scaling the ability for people to run nodes.

The Blockstream Satellite provides many advantages for different kinds of network configurations:

  • No internet or expensive internet: Connect a smart phone wallet to a satellite node via WiFi or meshnet;

  • Partition protection: Use a satellite as a cheaper source of blocks, and cross check with other peers. In the event of an internet partition, the satellite will automatically bridge the network outage;

  • Privacy: Use Blockstream Satellite to receive the Bitcoin blockchain with zero or low network footprint. You can verify the satellite data via other peers, and in low bandwidth conditions, with as little data as an 80 byte SMS with the most recent blockheader;

  • Financial sovereignty and security: Blockstream Satellite reduces the cost of running a full node to nearly zero. By running a full node and connecting your smartphone wallet and other wallets to it, you no longer need to trust third parties: As the saying goes, “Don’t Trust. Verify!”

  • Decentralization: One of the most interesting properties of Bitcoin is that it is a permissionless and digital gold-like bearer asset. To ensure Bitcoin stays permissionless, it is important that many people across many countries, [including] individuals and small businesses, run full nodes. By radically reducing the cost of running a full node, we hope many more people will, guaranteeing Bitcoin’s permissionlessness and reinforcing its bearer status.

In terms of innovative applications, we intend to provide a developer API to send application data via the satellite paid in mBTC/KByte so that the developer community, startups and local entrepreneurs can bring new applications to market.

We launched phase 1 satellite coverage across two-thirds of the world’s landmass, and we have plans for worldwide coverage by the end of the year. [As] Blockstream Satellite provides complete Bitcoin coverage globally, it becomes possible to access Bitcoin from a village without high speed internet and without grid power. Or with the right equipment, you could even access Bitcoin on the move from an RV or boat with motorized dishes.

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Technical

Dispatch Labs CTO Zane Witherspoon Explains How His Platform Created an Innovative Incubator Model

Dispatch is a platform promising zero transaction fees and a speed of tens of thousands of transactions per second (TPS). Is this platform a theoretical pipedream or worth a look? Find out more in this exclusive Merkle interview with Zane Witherspoon, co-founder and CTO of Dispatch Labs.

The Merkle: Can you tell us briefly about Dispatch Labs and how you got involved?

Zane Witherspoon: Dispatch Labs is a new chain built as a platform for data-driven DApps.

I was organizing the San Francisco Ethereum meetups when I met Matt McGraw and Patrick Wickstrom for the first time. We started talking about an idea of theirs for royalty leakage tracking using blockchain. It was probably the most boring thing you could do with such a new and exciting technology. We kept in touch, and started thinking about music. I’m a musician and Matt and I both have many artist friends, making us very familiar with the problems of artists and distribution costs.

We set out to make a content marketplace built on the blockchain, empowering artists to distribute their own music without middlemen taking a cut [of] their profits and bringing music to consumers for less. When we looked at platforms, we realized no blockchain could handle this quantity of data. That’s when we started working on building an underlying protocol and [it’s] how Dispatch Labs was born. A platform with speeds robust enough to support streaming music also had many other possible uses: AI, IoT, machine learning, streaming video, health records and data transfer, and more.

Both Matt and Patrick saw the bigger picture faster than I did, and as we built the platform, they brought up the idea of a consultancy. Patrick had spent years as a consultant at [PricewaterhouseCoopers] and Matt had helped many startups find major success, and [they] wanted to bring in people we could support as a consultancy and also introduce to our platform. I was so against it at first, but I couldn’t have been more wrong. We ended up forming a governing organization called The Bureau with Constellation Labs, a DAG protocol based on reusable smart contracts.

The Bureau became our innovation hub and governing organization, and our underlying protocols, Dispatch Labs and Constellation became the spokes. The Bureau lets us work with interesting blockchain projects, [supporting] their success as startups. In this structure, the Bureau builds out our connections, Constellation’s DAG works well at data intake, and Dispatch powers data collection and processing.

The Bureau at work inside Dispatch Labs’ San Francisco office

The Merkle: What kinds of partnerships does Dispatch have for getting new users and businesses on its platform? I saw you recently partnered with Utopi, offering a streaming video service.

Witherspoon: While we’re pretty blockchain-agnostic as far as how our Bureau clients develop their projects, many of them are excited to build on Dispatch because of the resources we can provide them and the influence they can have in the development of the protocol.

Nanovision is putting open medical data on the blockchain. This shared data would help to bring faster FDA approval for new prescription drugs. Nanovision also partnered with ARM processors to offer nanochip devices that could store your personal molecular health data on Dispatch.

Bucket seeks to remove coins from the fiat economy. Metal change like coins create a wasteful transportation cycle for companies to cash out at banks, and coin counter machines take a huge cut of consumers’ money for their service. 

The Merkle: You came up with a unique protocol known as Delegated Asynchronous Proof of Stake. How is this different from traditional Proof of Stake, and why was it necessary?

Witherspoon: Traditional blockchains have a hard cap [on the number of] transactions per second. This means the number of transactions is always limited by the number of blocks per second and the number of transactions per block. DAGs are one solution, but they are hindered by the shared quantity of data needed to be stored. DAGs like Nano and IOTA require you to keep a copy of the chain, meaning each individual has their own chain and keeps track of everyone else’s transaction.

Our solution was to apply a hybrid decentralized solution like Delegated Proof of Stake (DPoS), with a smaller quorum of elected validators, to a DAG structure to prevent bottlenecking like we see on traditional blockchains. We DAG-ized DPoS, removing the TPS bottleneck. In Delegated Asynchronous Proof of Stake (DAPoS), the bottleneck becomes the validators themselves. So as validator algorithms and hardware get better, the TPS of the network can scale up with them.

The Merkle: What kind of security auditing are you doing to make sure the Dispatch platform works as intended?

Witherspoon: One of the markers of [the] immaturity of [the] crypto space is there’s virtually no Quality Assurance (QA) on any crypto project. We have a dedicated QA team in our engineering department focused on testing our product. We hired a team of brothers, Dennis and Dimitri Molchanenko, who invented Redwood HQ, one of the most popular QA frameworks used by the US Department of Defense and others. We’re working on our own QA, and trying to encourage the rest of the crypto community to start thinking about it early on in projects as well. We’re also planning on [having] outside code auditing closer to launch.

The Merkle: What’s the most exciting thing about working on new protocols and projects in crypto right now?

Witherspoon: I get to talk about technology and business a lot, but one of the things I’ve learned as a 21 year old CTO [is that] the tech is one thing, but so much of the time it’s the energy of people that’s the magic behind something. I know my career is young, and I constantly feel amazed and blessed to be on the founding team I am, and that Matt and Patrick have taken me under their wing. I love these guys.

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Search and Trade Directly with AirSwap: A Merkle Exclusive with Co-Founder Don Mosites

AirSwap launched last week, enabling more than a million dollars in trades on day one. Offering a way for buyers and sellers to find each other and trade directly, AirSwap isn’t like traditional or decentralized exchanges. Find out more about AirSwap in our exclusive interview with co-founder Don Mosites.

The Merkle: Hi Don, thanks for speaking with us. I first reached out to you when I was writing a piece on eBits (DEXs), and you told me that AirSwap isn’t a DEX because it’s more of a discovery service for peer-to-peer trading. How would you describe AirSwap?

Don Mosites: Thanks for having me. Yes, we don’t see AirSwap as a DEX. We believe the concept of “exchange” itself is already decentralized on the blockchain between peers. Our system lets those peers find each other and make trades directly. So technically, we’re more of a marketplace, and our platform is powered by search.

The Merkle: Could you give some background on why AirSwap is set up differently from DEXs and traditional order book setups?

Don Mosites: When my friend and co-founder Michael Oved first connected to the Ethereum community, he began to apply his experience in algorithmic trading and electronic markets to figure out decentralized trading designs. His early research revealed some limitations of decentralized order books.

Order books evolved as fast and predictable systems that prioritize and execute orders. Decentralizing this process creates a difficult coordination problem. Last year, 0x created a protocol for “relayers” to decentralize order books, which still faced race conditions, front running, and having to pay for cancels, which is a non-starter for market makers.

Seeing this, we opted to instead focus on peer-to-peer, in the spirit of the original Bitcoin white paper. With AirSwap, all three components of trade are decentralized: custody, execution, and settlement. We simply provide a peer discovery service called an Indexer, which looks and feels like a bulletin board with a search engine.

The Merkle: What are the advantages of this setup?

Don Mosites: First, AirSwap can scale with the growing token economy as market makers come online and trade more and more assets, and because trades are peer-to-peer, there are no fees on those transactions. As for pricing, given that we’re built for market makers, spreads will be tighter and you’ll see pricing comparable to centralized systems as more makers come online.

The Merkle: There are so many DEXs and centralized exchanges available today, where do you see AirSwap in all this? How do you stack up against competitors like 0x OTC and Radar Relay?

Don Mosites: We bring security, efficiency, and better pricing to decentralized trade. Just opening the platform last week, over $1 million of trades were made through the marketplace, and we had an incredibly positive community response. AirSwap offers more efficient trading and does not suffer the limitations of decentralized order books as mentioned before. Users are always in control of their assets and make trades directly, peer to peer. Because trades are direct between peers, there’s less friction, and pricing will be better than alternatives, even comparable to centralized systems.

The Merkle: What are some of the security measures you’ve taken to ensure that AirSwap is reliable for users? Are you doing any outside code auditing or other forms of security measures?

Don Mosites: We had two independent auditors look at our smart contracts available on our GitHub. We’re also confident in our security posture because we don’t handle users’ funds or settle trades. That all happens on-chain, between individuals, using smart contracts.

The Merkle: What’s the number one piece of advice you’d offer to new investors in the space?

Don Mosites: Pick up a hardware wallet, because dealing in keystore files and private keys on your own is dangerous. Decentralization means security is in your hands, so you need to be very careful about how you control your assets.

The Merkle: Where do you see blockchain technology heading in the long term? What do you think will be the effects?

Don Mosites: This is a huge question, but where we can have an impact is in the reduction of expensive and fragile trust systems of exchange, replacing them with new ways for people around the world to safely transact without intermediaries.

The Merkle: What motivates the AirSwap team to create projects in this emerging market?

Don Mosites: So much about what we’re doing is powerful in how it makes us feel. As technologists, it’s incredible to put these tools to work and see a positive impact. There’s a real chance to make the world a safer and more efficient place to trade, and we think the power of that is yet to be seen.

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Hollywood Producer Andrea Iervolino Launches TaTaTu, a Blockchain-Powered Social Entertainment Platform

Since music and film became digitized, both the RPAA and Hollywood have fallen victim to a multitude of platforms that have come into existence, making content freely available and accessible to people across the world, driving down profits and revenue streams.

But, with blockchain technology, there may finally be a means by which to harmonize the digital age with the entertainment space, ensuring that content creators are protected and that brands and companies receive a fair distribution of revenues from production and content distribution.

In the hopes of balancing the equation, Hollywood producer Andrea Iervolino is launching a new blockchain-based platform, TaTaTu, that intertwines social media activity with entertainment viewing. TaTaTu is a global and social entertainment platform through which users receive rewards for watching movies, sports, gaming, and other forms of content, as well as from their friends’ viewing.

Recognized for films like End of Watch, ApocalyptoThe Merchant of Venice, and Machete, Iervolino hopes to bring Hollywood to the blockchain by integrating a 360-degree entertainment platform that ensures secure digital rights records, as well as the fair distribution of advertising revenue between users and content providers.

As the co-founder of AMBI Media Group, a multinational consortium of vertically integrated film development, production, finance and distribution companies, Iervolino’s vision is to develop a nurturing community of dedicated and engaged users who watch and create videos that can then be shared with friends and members of the community.

Harmonizing The Scale

Users

Thanks to blockchain technology, users will finally be rewarded for their social entertainment activity in an open and decentralized way – earning tokens to watch movies and other content for free, and receiving additional tokens from the movies and the content consumed by their friends.

Users can engage with their friends and be rewarded for their social media relationships by receiving digital tokens for views generated by both themselves and their friends. Token holders will also take active part in shaping the future of the platform, with the ability to vote on which content the platform should provide in a fully transparent and decentralized way.

Content Owners

The industry is no stranger to piracy and illegal downloading. Well, finally, content creators no longer have to worry about not being compensated fairly – or at all – for their work, because platforms like TaTaTu will monetize every piece of content based on effective user consumption and real-time views, providing for transparency and real-time financial reporting.

“Social networks and entertainment platforms are making huge profits by gathering data from their users and selling it to other corporations without rewarding their users,” says Iervolino. “There is a need for a platform that provides higher levels of transparency to their users, brands, and rights holders about the revenues generated and monetization of users. Audiences need free, legal and quality content with a simple user experience.”

Most content-based platform business models are centered around the idea that users need to pay for their content, which encourages users to find alternative, more cost-effective routes, ending up in the illegal marketplace (e.g., torrents and the dark web). “Well, no more, because TaTaTu is listening to the marketplace and adapting—giving free access to content and taking it one step further by rewarding users with an automatic monetization system,” says the Hollywood producer.

Brands

Advertisers can target specific audiences by placing their ads on a reliable platform with premium content. Brands get access to very detailed information about their audience. All user profiles are verified, and all the views and engagement metrics are accurate.

Encryption and Transparency

Thanks to its blockchain, TaTaTu can record each transaction in an open and incorruptible distributed ledger, ensuring that users and content providers get rewarded. A digital rights management platform will ensure that all talent, distributors, and studios have an accurate record of their work recorded and secured on the blockchain, reducing the percentage of piracy throughout the industry.

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