 I'm here with my good old buddy, Andrew the security guy, this is awesome, we got a really great show today, we're talking about my favorite subject, Bitcoin, Bitcoin, Bitcoin, we have Russell Custick-Narrow here, Russell is an expert in this industry and has his own company doing some pretty cool and interesting things, so we're going to talk about how to make Bitcoin transactions made easy, it's not that complicated. Everybody's scared, everybody's making it complicated, so grab a chair, have a libation, sit down and join us for another really exciting episode of BlackG-Duck, so we're going to talk about Wampum LLC, we'll get into that, but e-commerce for everybody, but first of all, I like to get a little bit back on our guests, so tell us about yourself, where you're from, who you are, what you do, so let's see, I moved here in 97 from Silicon Valley after doing a bunch of stuff in the e-commerce world, one of the first credit card websites for 18-year-old card services my team implemented, it was pretty exciting, and then I moved on and got frustrated with the mainland world and moved to Hawaii, started working for Data House, local consulting company, started their Java practice and got into e-commerce with them, and then a few years later I started my own thing, where I was working mainly around the Pacific Rim for e-commerce implementations on some sort of higher end platforms, and then I got into e-government after doing some startups and other things, so I ran the Hawaii Information Consortium, which was the state's main contractor for government services, so if there's something you could do with the state, and it's easy to use and awesome, we did it, and if it wasn't, then we probably did it. So are you involved, I love this loaded question, are you involved in the new tax system? No, HRC was not involved in the new tax system, ours was free and they paid for the several million dollars, so you can be the judge yourself. Yeah, I know, I just think I'm loaded, I love that one. Oh yeah, no thank you. So let's jump right into it, because you know I can believe this, before I came on the show I got a call from a broker wanting to know about how he can invest in Bitcoin from one of his clients, a broker, a stock broker. He does not invest? Well, in Bitcoin, in Bitcoin, so we're going to talk about how easy this to make a Bitcoin, so how do I get a Bitcoin? I mean, how do I get a Bitcoin? So getting a Bitcoin, there's three main ways. The first way is the easiest, and that is you can get it from a person, so somebody you know, me or to you, and you can buy Bitcoin from one of us, and there are websites that let you go to other people who are interested in selling their Bitcoins, like localbitcoins.com, and they list lots of people who are selling. All over the world? All over the world. And it's a Finland-based company, if I recall. That's correct, that's correct, and they even have like a little ATM software and stuff that people can use themselves. It's really, really cool. Another is Bitcoin ATMs, so a Bitcoin ATM works with with your wallet, and you basically put in some money or credit card, prove you are who you are, and normally you include like a phone number or something like that, and then it will send you Bitcoin. The first two are really good. Bitcoin ATM, it seems kind of nice, but normally the exchange rates a little higher. Now what about a Bitcoin broker? Because there's the Bitcoin exchange, and we'll use one that we used to use, I'm going to slam somebody, a Coinbase. So I used Coinbase for the longest period of time. You used it for the longest period of time, so that's another way, but it's a little bit more complicated. Well, yeah, so using an exchange, especially US-based exchanges, is how most people, if they're going to do a whole live transact, if you want to buy, if you want to invest, you're going to go through one event, and that way you can use your credit card, use your bank, you need to do a bank deposit, and it's normally the lowest cost way to go. The lowest cost, because you've got the exchange. Now we used to use Coinbase, but how come we can't use Coinbase now? So what Coinbase did is Coinbase was one of the more aggressive exchanges, and they went on a 50-state strategy, or 49 states, because there's 49 states that have money transmitter laws, and they wanted to get basically approval from each of the state's regulators, which here is the Department of Financial Institutions, part of DCCA. And so they submitted a letter to say, hey, we'd like to get your feelings on whether or not we can we can run, and the commissioner sent them a reply letter, which they put all over, you can see it up on Medium, which basically said, well, the only way it's okay is if you have a dollar backing every dollar in Bitcoin or other. For the state of Hawaii. For any of your customers in the state of Hawaii. It's a multi-billion dollar with a B, all right. So they weren't happy? Yeah, no kidding. That's I think the safest way to put it. They weren't happy with that. And so I think what they did is they withdrew. I think it's a lot like what Uber did in some of the cities, Uber and Yelp, and they went out until the environment was conducive to them working. So they came out and they're hoping, I think, things come down from the federal level, and maybe there's some consensus from her peers in the other states about how to really regulate this, because it's all over the map. You've got Vermont, you've got Arizona, you've got Nevada, Florida, who basically say, oh yeah, Bitcoin's exempted from any of our regulation. Right. And then you've got New York and Hawaii, and they are at the other side. New York heavily regulates them, Hawaii also heavily regulates. So it'll come up somewhere. It'll come up somewhere. And when the feds come in, they'll probably bring some guidance to. It's just really new. What was the DCCA's thinking behind trying to anchor real money? Well, they think there's a paternalistic kind of thing. They know better on what you and I should be doing with our money. Well, their job is to take care, is to make sure that people are protected, and they're always gonna err to trying to protect people from scams. And from themselves to a certain extent. Yeah, so I'm not happy about the decision, but you really, I mean, she wasn't gonna win any awards for saying go for it. No, nothing. But there's not really a winning solution here until other states really chime in. But the key is on this, we go back to the fact that I can send you a Bitcoin. In a little bit, we're gonna do a demo. I can send you a Bitcoin. You can send me a Bitcoin right now. And without even having DCCA or Coinbase or anybody involved, I can do that today. And there's no, essentially, there's no dollar limit per se on how much I can send doing this. So you sit and you go like, oh, they just don't understand. And I, what I did is I, because I like to use the exchanges, I moved mine to Great Britain, where the exchange was okay. So the World Wide Web and gives me all those opportunities. So it's just like, just so we can do it. So, but here's one is like right now Bitcoin is trading and Bitcoin is one of many cryptocurrencies. So let me say that again, because there's, there's my favorite, I'm not gonna say my favorite, but you know, there's other other ones out there. There's Litecoin, there's Ethereum, Ripple, you go down the list, there's a many cryptocurrencies, Bitcoin, market cap, right today is number one at trading about 2,200 bucks per Bitcoin. I've saw it go almost to 3,000 and saw it go to 1,800 last weekend. Yeah, I know. How is that for the fate of heart? Yeah, it just it's like a roller coaster, right? So which begs the question, how do the values get set? What's your, what's your perception on how that does? Well, what's really interesting, like when you look at Bitcoin, you look at Ethereum, what's really, really cool is because there's no institution driving, there's not like a New York Stock Exchange, there's not, there's not even a bank that's in charge. It's really the true market. And there's no market maker. Now, what a market maker is, it's like, like somebody who will guarantee, who will buy or sell whatever you want them to buy or sell at some price, like a bookie, you know, you know, right? So, oh, you want to bet on on UH, okay, these are the odds, oh, you want to be against UH, okay, here are the odds, they'll take either bet, right? And so they make the market. And the idea is when you have a big enough circulation and enough people interested in something, a market can be self regulating. In reality, you look at New York Stock Exchange, they have limits. So if more, if there's a certain percentage, if that if your market goes up or down, more than that percentage in a certain period of time, they stop trading, they freeze it, freeze it. Yep. So, so what happened, very interesting, like three or four weeks ago with Ethereum, which has less, you know, less circulation, less users, less buyers, there was appeared when it was up over 300, and it went down to 11 cents, and it went back up in the space of 45 seconds. Wow. Okay. And that's because there was no one taken, there was somebody said sell, right? There's this all software driven, right? Someone said sell, and there was no one to take the cell until 11 cents. And then everyone's trig all their software that's in there. And their soft said, Oh, my God, there was a buy 11, bye, bye, bye, bye. And it went all the way back up super fast. You know, and that's what you have when you have an unregulated market like it's fascinating. I think, I think the economists are watching this just salivating. And we need to mention that you can use crypto currencies to purchase things. So that's Oh, yeah, that's what we did. I mean, that's my whole business. Your whole business is all about, we're going to get into that. So, so the next thing is, so my friends and you've heard it too, you talk about are saying, Oh, this whole Bitcoin cryptocurrency thing is a Ponzi scheme. Yes. And so how do you respond to that? I mean, I respond to it all the time. But what's what's the what's the approach you take? So a Ponzi scheme, how I know this isn't the next mad off thing, right? Well, the big thing about a Ponzi scheme is you're taking new money, right, and giving that new money to existing investors as returns on in their investments, right, right, a pyramid scheme or Ponzi. That's all. It's clearly not the case. So Bitcoin and almost all the cryptocurrencies, one of the most important parts of them is having a public blockchain, right, or a public ledger. And that means anyone can look at any transaction see where it came from see where it went. And that means that there's no one taking new money that comes in and giving it to someone else. Because I can go look at that blockchain, you can go look at it and see it right now, right here now, like that 50 cent transaction that we did earlier, that, you know, that's not going to someone else who is buying a new Bitcoin, right? All the Bitcoin that you can buy has already been made. There's nothing new that's being made, right? There's no new stock being issued. There's no controlling party. It's all the system. And so so the value that's in that's that's that people give to Bitcoin is because they see that value there. It just it's a is truly a currency and it's not even a commodity, right? Because you can't I'm not going to go and build my house out of Bitcoins, right? I have to go buy things with them. So so it is truly a currency, right? Truly is a and takes you there. So so we've covered this we get now we're going to talk about the cryptocurrency wallet. Okay, what what is a cryptocurrency wallet? So yeah, so this is help the viewers understand this piece of it. I love it. So wallet is really a useful, you know, it's useful to bring out that imagery of a wallet, you know, I have my wallet, I have my credit cards in it, which are nothing, or my cash, right? And it holds my cash. Now, a wallet, in this respect, is normally software, but it could be paper, it could be hardware. That's a great picture. So here's a picture of here's an electronic wallet. That's right. So that's your your copay wallet, right? That's text, our wallet, by the way, text, right? No, that's not. I didn't show them. But that's a copy of one. Right. So so what this wallet does is on the the Bitcoin, there's the Bitcoin network, right? And the Bitcoin network is made up, I like to think of it as if you ever walk into an old business that has like little cubby holes for everyone, little mail slots. And so everyone's got their name on the mail slot, anyone can put a mail mail in but the only person who's supposed to pull stuff out is that person. So think of the Bitcoin network as this wall of infinite cubby holes. And instead of names, there's an address that's really long, long, and that that so everyone can see whatever is in there, what's been in there, where it's gone, where it's come from, all the history is all in the blockchain. And there's a secret key associated with that. And only the people, or the person or the computer that has has that information, that secret key can unlock the money that's inside and the data also that's inside that location. So all the wallet does is it keeps track of your public location, your address, and your secret key. And then whenever you open it up, it tells you how much money you have by going to the by going to the blockchain and saying how much is in here? Okay, pulling it back. And so it's look so all the time when I'm looking at my wallet, because this is going up and down all the time, right, looking at it says, okay, you have this much in your wallet, right? And then if you have a cool wallet, it's going to go ahead and in real time convert that to whatever your favorite currency is. So you know how you're tracking what you're going to work. Right. What is all worth at this point? So and what's what I made money on the 50 cents you gave me. Sorry, you're rockers people I gave about 20 about about 50 different people 50 cents over the last week. I was up in Portland at the World Domination Summit, they're all they're all sitting pretty they're all they've all like 86, 80, 75 cents. So I'm doing a presentation. I'm doing a presentation to a woman's association in August. And my plan is to get as many of them that want to will download a copay wallet and set it up while I'm doing my presentation. And then I'll send them all like 10 cents in Bitcoin. And the law sit there and say they already have it. That's the way to do it. To get share the wealth and share. But unless it's 10 cents, he gave me 50. No skimping. No skimping. So anyway, okay, we're going to come up on it. We're going to take a short break and then we're going to come back and we're going to talk about Wampum. Okay, commerce and how we're seeing this next thing. But it's been kind of cool. We've gone from the ground. We got the wallet. Now we're going to go into some exciting stuff that you're doing. And Angus has a question for you. So he wants to get Angus. We'll get Angus. So sorry, we've been talking so much, Julie. I'm learning. That's right. You're learning. My stock's going up. His stock is going up. I'll send you some Bitcoin. Anyway, we're going to take a break and we'll be back in about a minute. You're watching think tech Hawaii, which dreams live on think tech Hawaii.com uploads to YouTube and broadcast on cable OC 16 and a Lolo 54 great content for Hawaii from think tech. Aloha. My name is Raya Salter and I'm the host of power up Hawaii, which you can see live from one to one 30 every Tuesday at think tech Hawaii.com and then later on YouTube. I'm an energy attorney, clean energy advocate and community outreach specialist. And on power up Hawaii, we come together to talk about how can Hawaii walk towards a clean, renewable and just energy future. To do that, we talked to stakeholders all over the spectrum from clean energy technology folks to community groups to politicians to regulators to the utility. So please join us Tuesdays at one o'clock for power up Hawaii. Freedom. Is it a feeling? Is it a place? Is it an idea? At dive heart, we believe freedom is all of these and more regardless of your ability. Dive heart wants to help you escape the bonds of this world and defy gravity. Since 2001, dive heart has helped children, adults and veterans of all abilities go where they have never gone before. Dive heart has helped them transition to their new normal. Search dive heart.org and share our mission with others and in the process, help people of all abilities. Imagine the possibility. Hey, everybody, welcome back to think tech Hawaii and our Cryptocurrency episode of a boxy talk. I think even Angus is getting in on cryptocurrency. Angus, what do you got for us? But you do that. It's really great. Good man. Good to see you brother. It's great to see you brother. It's great to meet you. Yeah, it was awesome. All these years, you know, I keep all my money really close to my heart. So what I do is I keep my money in this. You showed the electronic wallet earlier, right? Right. So I have to think of the keep key. Yeah, because you know, I can hold on to my currency. For sure. Keep key. So the keep key is a kind of physical wallet. You can get you can download your key. You know, when you're talking about your own wallet, but other kinds because it can keep my wallet someone else. What else is there? That is such a great question. I'm so glad you asked it. The key is that you've got lots of different ones. We show the software wallet. You can also have a paper wallet. So a paper wallet, like I said, just has this, you know, your your public address, which you share, and your private address, which you do not share. That's your secret key. That one, right? So that's the one that you would hide and this is the one that you would have people send you money to. You can go take this, have people sending you money, have money going there, and you put it in a safe. Ah, right? Fine. There's also this is kind of a fun little thing. They've got these wallets. So you can actually preload money on one of these and so you can go someplace and say, oh, you want some Bitcoin, you can, I can put it on here. They can, of course, look at the address, see how much money I did. I scan it with my, I scan it with my computer. So here, we can put this in your pocket. How much is in there? Nothing yet. But I figured you can use your hardware wallet. Ah. Because you've got hardware wallets as well. And so hardware wallets work a lot like a paper wallet, except you can store more than one address. They can actually, they are based on, they're based on hierarchical, hierarchical wallets. And they are, they're really the only safe way to store, if you have a significant amount of money. Because what you don't want to do is you don't want to store a whole lot of money in, let's say, a Bitcoin exchange. Right? Because they own your key. Right? And if they get hacked, guess where your money went? Then again, you'll know where it went, but you won't be able to get it. Okay, that's why I keep it in my key, and then my wallet, and then my kilt. That way, you know what I mean. So you get your hardware key, you put it in your kilt. I'm always working there. Ah, yeah, I know what I'm doing. See, awesome. Hey, thank you very much. Anyway, I got a head on out, like you couldn't come back, but thank you. That's what was awesome. It was great to meet you. And send me 50 cents too, yeah? Okay, I'll, I'll, I'll, I'll set that address. Okay, I love it, lad. Hey, and like I said in every segment, let your ingame fever or your V, save your Bitcoin. Hello? Ha! Well, we gotta remind Angus not to go swimming with his paper Bitcoin wallet either. You know how he spent all that time on the beach. All right, guys, that was some good advice. That was some good advice. Be careful if you start sending Angus money, by the way. Yeah. Okay. I don't know, he might like it. You never know what he'll do it. Oh, definitely like it. He's so tight, he squeaks though. Anyway, so we've got some, I think we've gone through some great stages here. We've talked it up and tell, let's talk about Wampum, LLC and e-commerce and how Bitcoin is going to play and how you're playing, how you're getting into this, or you've been into this aspect of the business. Sure. What's happening there. So, so, you know, with Bitcoin, the primary thing that we want to do is bring e-commerce technology to everyone. And right now, if you don't have a bank, or if you are, or for some reason, you are like maybe not following the federal guidelines for some reason or another, like if you're in some state selling sex toys. Okay. Or if you are, Angus does with his vehicle. That's where we're going with it. But, you know, or if you are selling legal marijuana. Yeah, the marijuana industry. Right. You cannot, you know, you can't get a bank account. In the event that you could get a state bank account, you'll get no acquiring bank, no credit card merchant bank. We'll work with you. So, you know, basically it's out of, you don't have access to e-commerce tools. So you're doing things with bags of cash. Right. Which is crazy. This is what the marijuana industry is doing. Yeah. Very dangerous. As one example. Yes. So there's, there's, you know, all over you go in Colorado, they have armed guards, you know, in trucks, going around everywhere doing drops left and right all the time. That's just the way that they do things now. And it's, in my mind, it's crazy. I mean, we process $2 billion of payments for the state when I was at HIC. Can you imagine if they had to take all that in and cash? It would, it would, they wouldn't be able to do it. Right. It's totally not scalable. Yeah. There's, you know, industries that need this technology. And, you know, state, countries like Japan, South Korea, Singapore, they've already said, you know, we're on the boat. Right. But because these folks can't get banking, we wanted to make a tool that we, they would just have software. We wouldn't actually touch their money. Right. They could use the software to allow their, their, their stores to accept cryptocurrency at the storefront, like, like over here at, at local Joe. So like a point of sale? Like at a point of sale. Okay. Or online. So if they're selling something online, they can also take it and it shows a QR code. They get scanned. And, you know, there's automatic notification process because the blockchain. So, but I had, does that mean I have a different point of sale system or I can use, is it iPad or so? Right. So, so, so they're, they're, you know, it'd be silly for us to try and compete with all the point of sales. Exactly. There's a lot of really sophisticated ones. Having two phones. Right. You have shopkeep for some, for small businesses. And you've got these other really, really sophisticated ones for restaurants. And there's no way we wanted to compete in that really all we want to do is help companies use our software to accept currency for themselves. So we write plugins for existing point of sale system. Okay. So the existing point of sale system, I will come up, come up with my wallet. I'll scan it in, by the way, I haven't done the transaction. You'll pay from your Bitcoin wallet. I'll scan it in and pay for my Bitcoin wallet right then and there. And then how does the, how does the, not the consumer, but how does the, the proprietor get their cash? So the proprietor would then, what we would do is there, you know, there are a number of transactions that come in during the day. Right. And, and similar to like when they, when they batch their transactions for credit cards or something like that, there's a similar activity they do and they send it to whatever target location they want. It could be like uphold where it automatically gets converted to whatever currency they want. They could store it in, they could store it in Bitcoin natively or they could have it go to their hardware wallet like Angus. Yeah, they can actually transfer it to a bank. And they could, well, if they converted it over, they could transfer it back. Yeah, once it becomes another, once you, a non-crypto currency. So you mentioned uphold as one of those examples because there's an example and correct me if I get it wrong, is that I could go to the store if I have an uphold account which is not that difficult to create. I could then from my store send it to my uphold account and if I want to, from that point of time, I can move it to actually like a debit card. That's right. Yeah, so I've got a debit card. I've got a debit card that I have a Bitcoin location that I can just send my Bitcoin to. So there you go. And I can send it, this is a Visa debit. It's a Visa, so it's BitPay, Visa debit card that you can move Bitcoins to convert it to cash. Exactly. And what about the transaction fees? Let's talk about some of the value of Bitcoin here. Sure. We didn't touch on that yet. So Bitcoin transactions aren't free. Yeah. There's the underlying system. There's like 10,000 nodes running. They're all running the software that makes Bitcoin possible. Right. And they are given a reward when your transaction goes through. And that reward totally depends on not the amount but the size. So for instance, when Senator Ospero, we talked to him earlier, we sent him, I sent him 50 cents. Right. And the charge for sending that 50 cents was 26 cents. Yeah. And that was because Was it 26 or 2.6 cents? It was 26 cents. That was 26 cents. So and which is about as low as it can get when you're talking about Bitcoin at a price of $2,300. Right. So but if I had sent him $500, which would have been had to be reported, of course, because that would have been a donation. But yeah. 10 cents. Yeah. 10 cents. 10 cents. But if I had sent, you know, if I had sent him $500, that would have been 26 cents. So it's the same amount. Right, because it's the size of the transaction which is determined from a number of different things but not the amount. And by size of the transaction, you mean the... So what happens is, you know, you've got your address that you're sending to. You've got an address where your money's coming from. So what you do is every time a transaction happens, you take everything that's in a certain address, you send it in the transaction and part of it goes to the target you're going to. The rest of it goes to a new address that now your wallet has. Right. So that's your change. That's the change. So it automatically makes a change. Automatically. So the minimum is three transactions unless you just have a, you know, you got one Bitcoin, you're sending one Bitcoin boom. Right. That would be the difference. That's the difference. So the kind of the cool thing is that you can load up your wallet from friends or the services or ATMs or exchanges. Once I've got my wallet loaded up, I can continue to pass those cryptocurrencies onto anyone that wants to download a particular wallet to their device and then they have it. That's right. Now, what if I lose this device? So if you lose that device, so because you have all the information on the device, you could lose it just like if you lost your wallet. Exactly. You could use your cash. Luckily, you can also make a backup. Paper copy. You can make, you can have a paper copy or you can use what's called a mnemonic. So when you set up your wallet, you can use a mnemonic which is a series of, I think, 13 words or 26 words. It's like yoga. I can't tell you. It's some, yeah. But it's a number of words that you would then write down. It's made easier to remember. You write down, store it someplace safe and then you could reconstitute your wallet somewhere else. Okay, so we're running up on just a couple of minutes. So before we hit that, so let's talk about Wampum again. Briefly again, Wampum provides the ability to do, to accept cryptocurrency payments in real time and allows you to get that money almost immediately. Almost immediately without having to have a bank intermediary or a 2.5% charge or more if it's American Express. So where can people find it? So if you go to cryptowampum.com that is the best place to find that information. Our Twitter is at Wampum. At Wampum. Wampum is an Indian word that means Actually cryptowampum, yeah. It means money. Money, yeah. Right? And it might have a little extra spirituality on it. And so, I mean, this is a big, so again, this is the, and I've been saying this for a while, I'm not giving you investment advice. I'm just telling you that this is the next new wave. This is the equivalent of the worldwide web when it got started. As far as I can turn, people better be paying attention to it. And you're on your wallet as your browser. And your wallet as your browser. In the new world, in the new world of money, your wallet as your browser. Well, it is your browser. And so, and some of us are doing it. I mean, you've got mileage. That's a form of cryptocurrency. No matter how many you look at it. Anyway, no guess goes unrewarded. You get the autographs, so look up number 127 in the series. So you could probably get, oh, I don't know, a millionth of a bitcoin for this. Let us know if you do. I will like at least 40 satoshis. Yeah, there you go. Satoshi, not comparison. Excellent. Yeah. And if you don't know who that is, then you better go do some homework. That's right. Anyway, thanks again for joining us here in Hibachi Talk. Thanks for the team in the back that helps make this work all the time. Thank you, Russell. Thank you. Wampum. Go check it out. I promise you, you're going to really like what you see. And like we say at the end of every show, one, two, three, how you doing?