Choroid Plexus
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October 08, 2013, 08:58:41 AM |
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Here's a rough transcript I banged out of Danny's NEO&BEE speech in Amsterdam. Does not include Q&A (mainly because question askers were not miked up so it's difficult to hear). Also there are a few lapses in the speech where I was unable to discern the words.
...and I left there, moved [indistinct]. From that point onwards, I entered the family business where I began the managing director. At the time there was a lot of regulatory change surrounding the business, so I had to create and integrate all the policies and procedures to be sure it was compliant. From then, once we'd grown the business, we sold the business and I then entered into another role, within another family business which was in the training sector. We restructured the entire business and chopped [?] down so then later sold that business as well.
Between that point and now I found myself moving to Cyprus for my daughter-- and, Cyprus, basically, if you've not heard in the news, is the first country where the banks decided to exercise their right to take their depositors' money as they were unsecured creditors to the bank during the bail-in process. This meant that the two largest banks making the Bank of Cyprus were forcibly merged together. 100% [?] of uninsured deposits over 100,000 euros was taken for banking customers, this is both people and businesses. And 47.5% of business's and people's deposits from the Bank of Cyprus was also haircut to prop up the failing banks.
The [indistinct] idea was to tax the Russian money, the Russian mint [?] wasn't there anymore, and their bank said get out before the bail-ins occurred. A lot of the global media made it out to be a lot worse in Cyprus itself than what was really happening. I never once found a [garbled] point that didn't have any money that I could withdraw, because they did introduce the strict capital controls immediately.
And Cypriots aren't stupid. They're not going to go stand outside of a bank that is closed for two weeks in a hope to get some money out. They knew it wasn't going to be open. So, so they just sat around, talked with their family, and just built up the anger and the distrust in the banks that they had entrusted more than their family with their money. And the big thing for Cypriots is to leave a legacy for your family, for your children, for your grandchildren. That's no longer possible, because that money's gone. And all that they're left with is shares within the bank that are worth not very much. The price has crashed as you can imagine.
So within bitcoin, everybody, a lot of people thought that all the Cypriots would start running into bitcoin as a saviour. It was never going to happen. Many Cypriots don't spend a lot of time on the internet because of the nice climate. They spend time with their family at the beach, and not sat behind a computer like I do myself, and a lot of people in here would also do.
So, the people just don't know what bitcoin is or the news story is not the first bitcoin ATM in Cyprus. It's coming... that was great for me, I was really looking forward to that, kind of disappointed that it didn't happen, but it would've been an easier way to get bitcoin at the time. And exchanges were saying for Cypriot people that they could deposit, they will get zero fees on the transfers.
Which is all great, but the banks are closed, we can't use internet banking. We couldn't get money in. And again, people just didn't know what bitcoin is.
So, right after that I had already started the thought process about what would enable the average man or the average woman in the street, who doesn't spend a lot of time on the computer. What challenges would they face and what barriers are there to mass adoption of bitcoin. And then, once everything happened with the banks, it was the big bang event that is required to start any kind of revolution. So from that process, NEO & BEE was born.
We are going to be providing a more simple solution for people to access or use the bitcoin protocol for what they see fit.
The biggest part for Cypriots is not a way to earn money, to use it as a store of value. It's to just ensure that people without their permission can't just put their hand into their account, their wallet, and just take their money without them having any say in the matter.
So, to do that, it's all great. Bitcoin is wonderful. For stopping people taking your money. But it's very technical. In it's raw format, bitcoin is very off-putting to the non-tech-minded person. So what we're going to do, is provide branches where Cypriots can take in their euros, and exchange them for bitcoin. We will then put the bitcoin into a hosted wallet, if they see fit, or they can walk out with their own hardware wallet or paper wallet that we'll provide for them.
The way that they will manage their wallet will be very similar to what they're already used to.
So we're not enforcing too much change on them immediately. People need to make changes slowly with their daily routines and their spending habits.
To do it all at once, we would just face barriers. So we want to give them a way to use bitcoin in a way that they're already used to handling their finances and dealing with existing financial institutions.
The BEE payment network is our take on Visa or Mastercard, because it also answers the question "I've got my bitcoins, now what can I do with them?". And, people aren't very tech-wise in Cyprus like I've covered already, so we're giving them a debit card which is linked to their wallet, and this will work on our internal systems, it's not connected to Visa or Mastercard in any way.
So, so. So they can spend their bitcoins and you can also create some form of closed-loop economy. So, the average person will be able to use bitcoin to pay for their food, shopping, uh, fuel, and utility bills. Then the merchants can also pay their suppliers through using their cards as well. The... another thing that we're addressing is the price volatility. It's very off-putting to the average person in the street, so what we're going to do is offer a service where we can use our own reserves to top off the customers wallet if the price drops, and if it goes the other way, the balance transfers into our reserves once it starts thriving. The only real answer to curing the volatility is volume, of which we are going to be adding to, in the masses. That's what we plan to do anyway.
So, so we're going to be removing the technicalities, the volatility and the ease of access to bitcoin. Without having to enforce too many changes on our customers. With the BEE network, we're going to give them a simple way that they're already used to interacting with their money and spending their money.
We're constantly asked the question, "why don't we just create a wallet for the smartphone that's linked to the NEO account?" Smartphone usage in Cyprus has a market penetration of about 25%, which to everybody here would sound absolutely crazy. But the Nokia standard ringtone is the most common annoying noise you can hear in Cyprus, and so we're not going to be bringing it about immediately, it's in our power to, but it's pretty far down the list at the moment.
The biggest question that we're getting as well is with regards to how we're going to protect ourself against falls in the price of bitcoin.
We currently don't have that many trading platforms that we can use to strengthen our positions during any volatility, and also [indistinct] volatility provides any good trader with the opportunity to strengthen their position.
So what we're also doing is we're also going out and speaking to a lot of existing trading platforms, that operate within the traditional markets in Cyprus, there are a lot of platforms that are based in Cyprus because of the great tax benefits that being in Cyprus brings.
And they're very, very welcoming. They've heard of bitcoin, they don't really know too too much about it, they just see the charts of up and down, so once we explain to them that that is something that can be addressed with volume, they 100% agree and every meeting that I've had, every single one of them has been making plans on what they can offer their existing clients in bitcoin.
So it's been extremely positive.
Also, the key to our successful [garbled] is we need to build up trust with the Cypriot people. They've just had their trust absolutely destroyed by the behaviour of both the government and the banks by taking their money.
So throughout [?], we're going to be very open, honest and transparent with everything that we do. We can and we will be ensuring that there is no small print that we can hide in a closet away, where it says that our customers are unsecured creditors to us, because they're not.
We hold their bitcoins in their wallet for them, as the security of [indistinct] your wallet is [indistinct] tricky for the normal person, and so absolutely, it's got to be built right.
So, so with marketing, we're taking a very straight, direct approach to telling them that they can take back control over their own money if they use services that we offer or bitcoin itself.
We're very much interested in providing knowledge on bitcoin to the masses as well. In languages, in a language that they understand without making it too technical. We're also going to be advertising on TV, radio, out of homes on the billboards, with airlines.
We've also got lots of exciting activities, PR activities planned for [indistinct]. And they include a Guinness World Record attempt, where we are going to be going around the streets of Cyprus with boards that say "I am the NEO economy". NEO translates as 'new' from Greek into English and also many other languages. Because we want to promote the fact that the people are the economy. Not the banks. And through that we're going to be creating the world's largest photo collage, which will also bring a lot of public interest in Cyprus, [indistinct] just don't happen in Cyprus.
We've already had a lot of, uh, local media coverage and interest. I get phone calls every day. I'm guaranteeing today I'll get ten calls from different journalists, wanting personal interviews with myself to explain exactly what we're doing. So we have just been raising the capital to ensure that we can get started so we don't create false promises for the people. Every story that's so far been written in Cyprus has highlighted the fact the benefits of what bitcoin would bring to the people of Cyprus. And also, the benefits of being an early mover into the bitcoin market, is going to bring benefits for Cyprus itself. And we're trying to create a whole new industry, which brings me onto the regulation side of things.
We are working with Christos Constantinou [?] and KPMG. They're our accountancy and auditing partners. It's really ourselves, KPMG, and the lawyers, we are now directly in contact with the regulators in Cyprus, in the central bank, with the Cyprus securities and exchanges commission. We are posing to them a set of legal guidelines and a framework that we believe to be sufficient and clear for bitcoin businesses to operate within.
Because very much as we've noticed in the US that the existing frameworks are very restrictive to innovation and also [inaudible]. Square pegs into round holes. So because we've got very reputable lawyers and KPMG, who need no introduction, they, the lawyers of KPMG do believe that once we've put together the framework that we want to operate within, the central bank and regulators will be welcoming of those facts. So we can have a direct input into the regulations and the framework that we've got to operate within.
So, that will also create a hotbed and a safe haven for bitcoin businesses to operate from in Cyprus. Cyprus now is crying out for outside investment, from external parties, from outside the country, sorry.
So, we've got that as well. We've already said to them, and they're very interested, because they can see-- all they have to do is type 'bitcoin' into Google and they can see all the venture capital that's been pouring into startups within the space. So, Cyprus wants a piece of that, that market, and it will also create a whole new industry in Cyprus which will be pulling to move away from the traditional banking sector and [inaudible].
We've, we have got the risks of being the first into the massive adoption, of the real massive adoption for average man and woman in the street. That we fail, if we fail, our customers' bitcoins are still safe because they're held within their wallets. And we're going to be using the multiple signature address to... sorry. So we're going to be using the multiple signature addresses to enable the customers to be able to protect themselves and their inheritance for their children and grandchildren and the rest of their families.
Because [indistinct] if you don't share your private keys with anybody, or your password to decrypt your wallet, once you suddenly pass away, that money's gone, there's nobody that can access that money.
So that was another problem that we needed to address. And if we fail as a business, we need to ensure that our customers can still attain their funds, and we're doing that through a third legal party which will be outside of Cyprus and outside of the EU.
All the customers will receive, upon startup, a detailed guide on how to access their money if we're not there anymore. And we want with this to emulate what we're doing in Cyprus around the world, and even in Cyprus.
Because then if we fail for whatever reason, we can allow other people to take over the money of their wallets if they wish, or they can go directly through the third legal party to withdraw their bitcoins to their own wallet or back into the euro or the Cypriot pound or whatever currency they're using in Cyprus at that time.
We're very much focused on creating that closed-loop economy. We want to drive the adoption through the merchants, the merchants are very key to what we're hoping to achieve.
We can offer instant settlements, much much lower transaction fees to what there are currently offered through Visa or Mastercard and AMEX, that... the more traditional networks. So once it becomes clear to the merchants that bitcoin is better, faster, and much cheaper, than what they're currently paying, then they will [inaudible] because it works out better for themselves when somebody pays using a BEE card.
And that pretty much brings me to the end of it. Uh, again, Cyprus has seen that big bang event that allows revolution to occur. There is no other place other than maybe Argentina where there is the distaste towards the traditional establishment. So we believe that we've got the ideal platform to enable bitcoin to be brought in a simple form and a usable format to the masses.
So we will be opening our first branch, as a soft opening, the 1st of January. Sorry, the 3rd of January. And we will start accepting money for bitcoins from the 1st of February.
So, that brings me to the end of everything that I've got to say, and if anybody's got any questions, please feel free to...
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