[2015-04-07] ARS - Bitcoin Foundation is “effectively bankrupt”

[sgk]

One of the newly-elected board members of the Bitcoin Foundation—the 2.5-year-old organization that was meant to bring order to the famously open-source and freewheeling cryptocurrency—has declared the group "effectively bankrupt."

While the Bitcoin Foundation obviously does not have control over Bitcoin itself, it’s the closest thing to a public face that the community has. Individual memberships start at $25, while corporate memberships start at $1,000 annually. The non-profit’s own tax filings from 2013 show that it ended that year with over $4.7 million in total assets—nearly five times as much as it had at the same time the previous year. It has yet to release financial details for 2014.

FULL STORY
http://arstechnica.com/business/2015/04/bitcoin-foundation-is-effectively-bankrupt-board-member-says/

[Dogtanian]

I don't see how having 4.7 million means they're bankrupt but I doubt they'll be able to sustain operations based entirely on donations. That's their problem. We don't need them and their members seem to just serve their own interests as opposed to the greater good of bitcoin and everyone else.

[EvilPanda]

Of course they are, the Foundation is not really that important and Bitcoin could exist without it, so I don't really see how the foundation is doing a job worth paying for.
At the same time they are paying their members 100-200k USD a year, which is a lot, especially that these people can have other sources of income and probably do. The rich are getting richer and nothing changes for Bitcoin.

[JJB]

I've often wondered how they even make money. Can't imagine there's many people who want to throw money at them any more just to get the great prestige of having their name and logo on their website (sarcasm).

[cr1776]

I don't see how having 4.7 million means they're bankrupt but I doubt they'll be able to sustain operations based entirely on donations. That's their problem. We don't need them and their members seem to just serve their own interests as opposed to the greater good of bitcoin and everyone else.

$4.7 million was the end of 2013 and $5.2 million Jan 2014.

January 2015, they had around $463k (according to their leaked docs).  Their burn rate was around $150-$200k/month so far in 2015.

It was a bad implementation of a bad idea from the start.

[pawel7777]

Of course they are, the Foundation is not really that important and Bitcoin could exist without it, so I don't really see how the foundation is doing a job worth paying for.
At the same time they are paying their members 100-200k USD a year, which is a lot, especially that these people can have other sources of income and probably do. The rich are getting richer and nothing changes for Bitcoin.

Yup, but they also support/pay salaries to the core devs (possibly the only good thing about TBF).

[Bit_Happy]

Janssens said he would prefer to heed whatever the group’s existing members decide.

"If it’s up to me, I’d make it a positive-only organization, no longer involved in any power position," he added. "I would think it’s great to engage the members and make a map of every store in the USA, and have members go store to store to convince them of the benefits of Bitcoin, and in return they could get an affiliate percent or a referral reward. I also see the Foundation helping to organize mass changetip events to get a bitcoin (or bit) into the hands of every person in this world. For something like that, it can be very useful, and add a lot of value to Bitcoin itself. It’s a non-threatening, positive thing to do."


The ideas above would certainly have a more positive effect than the way the BF handled "relations" with the wounded MtGox.

[unamis76]

One thing is they're bankrupt, the other thing is wasting 4.7 million. How is this even possible? Wasn't outraged with the news, but now I am with the numbers... It definitely isn't possible to keep having a Foundation...

Shame on them. If this is the PR we have for Bitcoin, might as well not have it.

[freedomno1]

I have 5 million dollars sitting around last year but you know I'm effectively bankrupt
This makes me suspicious still stinks even with the update that said guess the price did crash so valuation could drop a ton.

http://blog.bitcoinfoundation.org/the-facts-about-the-bitcoin-foundation/

The Foundation is not bankrupt nor have there been any discussions regarding a potential bankruptcy. As with other bitcoin companies that hold bitcoin, the drop in bitcoin price drastically affected the Foundation’s bottom line as the majority of assets were held in bitcoin.

[sgk]

Some interesting news coming out with relation to Bitcoin Foundation:

Crowdpayment startup Mobbr to pay every core developer

Crowdpayment site Mobbr, yesterday went live with a project to pay the often overlooked work-horses of the bitcoin community, known as core developers, who are responsible for not only fixing bugs within the code but helping ensure it remains a robust platform as more and more companies build on it.

http://upstart.bizjournals.com/news/wire/2015/04/10/crowdpayment-startup-mobbr-used-to-pay-every.html


New Bitcoin Foundation Director Bruce Fenton Pledges Fiscal Reform

Veteran bitcoin activist Bruce Fenton has been named the Bitcoin Foundation's newest executive director.

Elected by a 5-to-1 vote, Fenton succeeds interim executive director Patrick Murck and outgoing executive director Jon Matonis, the latter of whom resigned on 30th October amid financial turmoil and ahead of staff cuts at the industry’s top trade organization.

http://www.coindesk.com/bruce-fenton-bitcoin-foundation-executive-director/

[Rampton]

Of course they are, the Foundation is not really that important and Bitcoin could exist without it, so I don't really see how the foundation is doing a job worth paying for.
At the same time they are paying their members 100-200k USD a year, which is a lot, especially that these people can have other sources of income and probably do. The rich are getting richer and nothing changes for Bitcoin.

Yup, but they also support/pay salaries to the core devs (possibly the only good thing about TBF).

Who was in charge of the foundation's funds and deciding who gets what and paying their wages? Sounds like they've just been giving themselves extravagant salaries and now they're screwed cos there's not enough money coming in. Doubt they care they got their piece of pie. Suppose they're thinking it was good whilst it lasted, though.

[notthematrix]

http://blog.bitcoinfoundation.org/the-facts-about-the-bitcoin-foundation/

[Rampton]

http://blog.bitcoinfoundation.org/the-facts-about-the-bitcoin-foundation/

Already posted above by freedomno1.

[pawel7777]

Of course they are, the Foundation is not really that important and Bitcoin could exist without it, so I don't really see how the foundation is doing a job worth paying for.
At the same time they are paying their members 100-200k USD a year, which is a lot, especially that these people can have other sources of income and probably do. The rich are getting richer and nothing changes for Bitcoin.

Yup, but they also support/pay salaries to the core devs (possibly the only good thing about TBF).

Who was in charge of the foundation's funds and deciding who gets what and paying their wages? Sounds like they've just been giving themselves extravagant salaries and now they're screwed cos there's not enough money coming in. Doubt they care they got their piece of pie. Suppose they're thinking it was good whilst it lasted, though.

I've no idea who and how decided on salaries, but I doubt it has been put under voting among regular members.
They knew they don't have enough revenue stream long time ago. Now, when nearly run out of funds, Murck is talking about "restructuring". The right time to do it was ~2 years ago.

Apparently Gavin Andresen is not on the payroll from 1st April and stayed as volunteer. Not sure about other devs.