{ "episodeId": "SLP709", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "dr_padraig_corcoran": { "name": "Dr. Padraig Corcoran", "role": "guest", "tag": "DR." } }, "segments": [ { "speaker": "stephan", "time": "00:00", "start": 0.06, "text": "So we find that adoption is, is growing over time. So this data, that I used the data at a fixed timestamp in my paper in twenty twenty four, I think, at that time there was eleven thousand merchants represented in the BCC map, and just as of the first of January this year, there's closer to almost double that number of merchants represented in BTC maps. So in, in Prague, we found that six percent of all restaurants in Prague accepted Bitcoin payments, while in Berlin, it was over seven 55% of merchants in that region. You, you can't legislate adoption, and even if you have legislation which is very pro- adoption of Bitcoin, it doesn't necessarily translate into adoption by merchants and customers. It has to be a mixture of top down and bottom up, I believe." }, { "speaker": "dr_padraig_corcoran", "time": "00:47", "start": 46.64, "text": "Hi everyone, and welcome back to Stephan Livera Podcast. We're gonna be chatting about the special use of Bitcoin as a medium of exchange, and joining me is Dr. Porik Corcoran. He is a reader and deputy head, deputy head of school in the School of Computer Science at Cardiff University. Now, Porik, you did some interesting research, and, tell us a little bit about, you know, just a quick background on yourself and what got you interested in this idea." }, { "speaker": "stephan", "time": "01:14", "start": 74.46, "text": "Okay, so, so, yeah, so I'm an academic, from Cardiff University, and my background in terms of research is really geographical information science, spatial algorithms, and I've done a lot of work on crowdsourcing, crowdsourced geographical information, geographical data. And in recent years, I got, I got quite interested in Bitcoin, and I started to pivot my research somewhat into looking at some of the open research questions or problem, problems in the Bitcoin space. And to date, I've written quite a few papers on Lightning Network, and more recently, I, I've written, written a paper and published a paper on the analysis of the use of Bitcoin as a medium of exchange using crowdsourced geographical data, so drawing from my previous experience. In, in, in our expertise in that space." }, { "speaker": "dr_padraig_corcoran", "time": "02:08", "start": 127.81, "text": "Fantastic, yeah. And as I was looking through, I thought it was really interesting. I think this first came up when I saw the, yeah, like the, the BTC map guys, I think tweeted this out or posted this out, and, and I think I retweeted this and I thought, oh, that's actually kind of interesting that, you've sort of built this based on the OpenStreetMap stuff, which obviously, I'm sure you know that more than I do, but, for listeners, give us a brief overview Maps." }, { "speaker": "stephan", "time": "02:35", "start": 155.45, "text": "Okay, okay. So, so, so for this analysis, I was using data which is from a project known as BTC Map. So BTC Map, you can kind of think about it as a kind of a social layer on top of OpenStreetMap. So, so what is OpenStreetMap? So, so OpenStreetMap is a, a crowdsourcing project for geographical data, and it's been around for, for over twenty years. So, so it was founded in two thousand and four by a, a British guy called Steve Coast. And at the time, Steve Kost, he got a bit disillusioned or dissatisfied with the state of open source and free geographical data. So there was lots of good geographical data available at the time, but, but it was proprietary and not free and open. For example, in the UK We have a national mapping ag-agency known as the Ordnance Survey, and they're a very well-funded national mapping agency, and they capture very rich and very good quality geographical data. But this data is proprietary, some of it is, is, is open, but you have to use it within certain terms and conditions. So, so Steve Kous decided to, that it would be a good idea to create an alternative, a free and open source geographical dataset to, to rival these proprietary datasets. So this is, this kind of story might sound familiar. The Linux operating system was, was created by Linus Torvalds, and that was motivated by By his dissatisfaction with the-- at the time there wasn't a free and open source Unix operating system, so he created Linux. So I digress. So, so, so OpenStreetMap, is a free and open source geographical dataset, and it's created through the use of crowdsourcing of data. So volunteers mapping their local communities, ideally. So this has got some pros and cons. So it's crowdsourced. So there are advantages and disadvantages. advantages to, to the use of crowdsourced data. So one of the advantages of geographical crowdsourced data is that the interior in, it can, the data, and in practice sometimes the data can be of very high quality. In the sense, if you've got a local region, the best people to map Or create a geographical representation of that region or the local people who live in that, in that region. For example, if you take a feature like a park, the locals will know all the entry and exit points to that park, which somebody who's just a visitor to the region may not, may not know. So it has interior potential to be very, very rich data, much ra- richer than, you know, o-o-other data sources. There are some disadvantages to, to crowdsource data, in the sense that, you know, the quality can, can vary over space and time as a function of, of, of, of the contributors. Okay. So So if you have a particular geographical region with a lot of enthusiastic and hardworking contributors who are really in, in motivated to map their geographical region, you will have high quality data in that region. While on the other hand, if you have some region which, which you've got no-- there isn't no crowd, there isn't no contributors in that region, no people contributing to the crowdsourcing process, the data can be very, very weak or poor quality. So it, it can be- so, so traditionally, if you have a dataset, you might have a single metric to say that the data in this dataset is good quality or bad quality, but for crowdsourced geographical data, it's difficult to have a single metric of quality that you can apply to the entire data. Instead, the quality can vary over space and time. So, so, so BTC Map was a kind of a social layer Or a community that came along and they decided that we want to facilitate people to not just save their satoshis, but also spend them. And in order to facilitate that, people know-- need to know or be aware of which merchants accept Bitcoin in exchange for goods and services. So they decided that they, that they would leverage or use OpenStreetMap to s-represent or store that data. So, so they created this initiative to try and, or social layer on top of, or community on top of- Top of, of OpenStreetMap where they would promote and encourage the mapping or representation of merchants that accept Bitcoin payments in OpenStreetMap. So, so, so maybe I can talk a little bit about how the data is represented in OpenStreetMap." }, { "speaker": "dr_padraig_corcoran", "time": "07:10", "start": 429.83, "text": "Right. Yeah. So, yeah, so I guess for listeners who maybe, if you haven't been around, if you're a newer listener, you can also check my earlier episode with Nathan from BTC Map where we spoke a bit about that. but yeah, I, I think it's- It's an interesting, definitely a cool project. There's an app, there's a website, and people can now use this, like if you're traveling to a region and you wanna be able to spend your Bitcoin, well, then that's, one way. Interestingly, I think it's also getting used and hooked in even on the square side with their thing also. So like, it's, it's really kind of becoming an interesting community and Bitcoin ecosystem play in a way that, it's kind of helping the merchants and the spenders find each other. And so that's kind of Really interesting there as well. So, yeah, did you wanna go on there on, what, what you were gonna mention there?" }, { "speaker": "stephan", "time": "07:58", "start": 478.14, "text": "Yeah, so, so I can talk a little bit about how it's, how it's represented in, or how the, how the BTC map community went about representing merchants in, in OpenStreetMap. So, so OpenStreetMap is, is kind of an open platform where You know, so you have all geographical features will be represented using geometrical features representing the location of the feature, but also semantic information represented using tags, okay? Sorry, OpenStreetMap doesn't limit the tagging conventions that you can use, so you can use whatever tag features how you wish. So, so, the BTC map community came up with a tagging convention of representing merchants in OpenStreetMap. So, so- Initially, the convention has changed over time, but now there's a standard convention where you can simply, very easily, query the OpenStreetMap database to extract all the merchants using a standard tagging convention." }, { "speaker": "dr_padraig_corcoran", "time": "08:56", "start": 535.88, "text": "Great. And so this enables people to understand what type of vendor it is, what type of merchant it is. Is it a cafe? Is it something else, et cetera?" }, { "speaker": "stephan", "time": "09:05", "start": 544.63, "text": "So merchants will be tagged with many different tags describing the different characteristics of, of, of the geographical feature or merchant in this case. So merchant will be tagged with, for example, there's a standard convention for, for representing cafes where, where you use a, a key, key-value pair of amenity equals cafe, and then you would also to signal, or signal that that merchant accepts Bitcoin as payment, you would also add the tag, BTC equals yes." }, { "speaker": "dr_padraig_corcoran", "time": "09:35", "start": 575.47, "text": "Right, and I, and as I understand, even on the website, they show things like on-chain only or Lightning also, this kind of thing. So obviously it's nowadays in-person commerce generally is being done with Lightning, but maybe some higher-value things, if it's like thousands and thousands of dollars and maybe it's online, then okay, maybe they just stick to on-chain. I guess these are just different things. But let's get further into what you found. So as I understand, you, you went through and you were analyzing this data to try to, I guess, pull out some Understand, you know, what's the quality of this data. So can you talk to us a little bit about this particular paper that you wrote? What was your, your main goal there?" }, { "speaker": "stephan", "time": "10:14", "start": 614.21, "text": "Yeah, so I was interested in doing analysis of the adoption of Bitcoin as a medium of exchange. So, so money can form, can serve many different purposes, a unit of account, store of value, medium of exchange, and you can measure adoption along all those dimensions. We were interested in, in measuring adoption as a medium- Team of, of ex-uh, so Bitcoin is based on a blockchain, and all transactions are stored in the blockchain. So each transaction is basically represents the transfer of ownership of Satoshi's from one pseudo-anonymous address to another pseudo-anon-anonymous address. But just examining the blockchain alone, even though the data is unencrypted, unencrypted and it's open, it doesn't give you a lot of context about the transaction that took place. So, so, 'cause you just know the pseudonyms. We don't know where the transaction took place, what context it took place in, was it part of a medium of exchange, and if so, what type of medium exchanged. So generally to do analysis of the adoption, lots of people have done the ana-analysis of, of, of the adoption of Bitcoin along many different dimensions, but generally, you know, to do that analysis, you can't just rely solely on the blockchain data. You generally need to augment that data with some external data sources to, to give you a bit more color or insight into what's going on." }, { "speaker": "dr_padraig_corcoran", "time": "11:35", "start": 694.93, "text": "Gotcha. So I guess, let me just quickly explain that, I guess how I understand it, just so listeners can, if they're newer, they can get that. So if you look on the, on the chain, or if you look on mempool dot space or a block explorer, you can look up the transactions, but really what you'll see is like inputs and outputs, and you may see, oh, you know, BC1Q whatever, whatever, whatever, it received this amount of coins, and some other one has received that amount of coins. But what do you actually do with that They're gonna try to cluster those addresses to understand, oh, these are probably an exchange, or this is probably a custodian there, or this looks like maybe it's a big merchant there, and I guess there are, or this looks like it's a, it's an individual or a plebs wallet per se. And so I guess there's some insights around that potentially, but I think there are some very powerful insights to be drawn from looking at this OpenStreetMap data." }, { "speaker": "stephan", "time": "12:28", "start": 748.12, "text": "Yeah, so, so you want, you, you know, to gain a greater insight in, in, into, into the To many analysis of different types of adoption look at kind of what other alternative data sources can we use beyond just the blockchain data. So in the past, people have looked at web traffic data to exchanges to get an insight. So for example, in a given country, is there a lot of people visiting this particular exchange, which might signal interest or use or adoption of, of Bitcoin? In the past, people have looked at social media data to try to get, you know, to try to, is there a lot of positive sentiment around? Around Bitcoin and also certain exchanges publish reports about the number of users. So there is some other data source that you can use. But before, so before our study, we, we, we, we looked at, we wanted to look at our, our, the insight, our idea was to look at merchant data. So could we look at, could we identify merchants that accepted Bitcoin as a medium of exchange and use that as a signal or an indicator of adoption as a medium? medium of exchange. So, so we're just, we just know that the data will tell us whether or not a merchant accepts Bitcoin as a medium of exchange, it w-will not tell us The, the volume of transactions that that merchant is accepting via Bitcoin. So it's just an indicator, and I sometimes like to think about it as a kind of analogy would be When we're trying to measure commercial activity in a given urban area, we regularly use footfall data as an indicator of commercial activity. So here we're using merchant adoption as an indicator of use of the medium of exchange. So, and the hypothesis is, is based on the fact that, or the, or, or the, the, the, the notion or the idea that if in a given geographical region there are a lot of merchants that are accepting Bitcoin as a medium of exchange, that kind of suggests that there is some sort of- Market factor or incent-something incentivizing those merchants to accept it because there is some kind of customer-customer demand for that, because The, if, if, if it's just a single merchant that accepts Bitcoin payments, they may not, they may my, they may accept it for other reasons beyond, you know, commercial demand. Right." }, { "speaker": "dr_padraig_corcoran", "time": "14:47", "start": 887.36, "text": "Like more ideological reasons, let's say, because they believe in the mission of Bitcoin, et cetera." }, { "speaker": "stephan", "time": "14:52", "start": 891.64, "text": "Yeah. So, so if you, if, so if you, if we believe that if you have a large number of merchants that are accepting Bitcoin payments in a given geographical region, that suggests that it's, it's-- that there is a market demand for it. But" }, { "speaker": "dr_padraig_corcoran", "time": "15:06", "start": 905.91, "text": "these- Yeah Circular economy thing, and maybe you want to touch on that, because to be fair, there are also like communities of Bitcoin Maxi's around who are going around and trying to onboard merchants and try to encourage people to earn and spend in a particular re-region, whether that's, you know, El Zonte or Berlin or Prague or somewhere else. can you touch on that a little bit, of any insights around the circular economies?" }, { "speaker": "stephan", "time": "15:31", "start": 930.86, "text": "Yeah, so, so we try to, we try to do, try to identify some of the factors which were maybe driving adoption in, in some of the regions, and we looked at some of the, the macro and micro-macroeconomic factors to see if there was a correlation between them. Microeconomic factors are more kind of factors which are driven by individual choices, while macroeconomic factors are more larger scale factors such as government policies or government interventions. So we tried to see was there, was, a correlation, which doesn't imply causation, but we want to see was there a correlation between some sort of, some- Government policies or inter- merchant adoption. So we looked at, the Trump administration has recently proposed the idea of a strategic bit-bitcoin reserve for, at the US, at the state, at the, the country level, but some of the states have followed suit and many, many states are proposing their own state-level strategic bitcoin reserve. So I just saw in the news recently, Texas passed a bill to have a strategic bitcoin reserve for their state, and Florida has proposed a bill to, to have a strategic bit- Bitcoin reserve in their state. So, so we looked at the US, we, we split it into two groups, states which had proposed a Shiji Bitcoin reserve and those which had not, and we wanted to see was there a statistically higher merchant adoption in states where there was kind of this top-down, let's say, government support or government sent-- strong sentiment coming from the government that they were supportive of Bitcoin adoption, and we found that You know, there wasn't a significant difference between the, the number of merchants in states where there was a proposed Bitcoin strategic reserve as opposed to those states which didn't have a strong, didn't, hadn't, hadn't proposed- So it didn't make much of a difference? Didn't make a difference, you know. So that kind of top-down, macroeconomic factor didn't seem to influence, it seemed to be independent, the adoption by merchants seemed to be independent of that, statistically speaking." }, { "speaker": "dr_padraig_corcoran", "time": "17:34", "start": 1053.63, "text": "Interesting. So I wonder, I mean, if we were to kind of speculate a little A little bit or try to put our heads into the minds of, you know, people on the ground. Is it, is it just that, you know, it doesn't matter that much to them? Is it just more like if I think, you know, when I talk to people like, let's say, Francis from Bull Bitcoin, and he's in Costa Rica and he's kind of talking about Bitcoin jungle as like this, you know, great bottom-up story, and then maybe on the other side of it, maybe there are people who are saying, \"No, you should be in favor of the" }, { "speaker": "dr_padraig_corcoran", "time": "18:08", "start": 1088.27, "text": "Behavior also. I, I'm curious any reaction on that or any, any hypothesis or theory you have there?" }, { "speaker": "stephan", "time": "18:15", "start": 1095.23, "text": "Yeah, so we, so we looked at, El Salvador as well. And so obviously they had quite, they're quite pro, Bitcoin with, with making Bitcoin," }, { "speaker": "dr_padraig_corcoran", "time": "18:29", "start": 1108.54, "text": "the legal tender, the legal tender in twenty twenty-one, although it's taken away, but still a lot of people are using Bitcoin, so it's kind of a complicated situation, but of course they are definitely pro Bitcoin." }, { "speaker": "stephan", "time": "18:38", "start": 1117.65, "text": "Looked at different regions in, in El Salvador, and we found that that one, the places that had greatest adoption or greater than other areas in El Salvador was the region of Berlín. So, so we tried to understand why did this have greater adoption than other regions in El Salvador, and we kind of hypothesized that this may be a consequence that they've got a lot of kind of Strong social networks, bottom up, grassroots initiatives to promote the adoption of Bitcoin as a medium of exchange in that region. So that seemed to be-- so other region, despite, you know, the, the pro-Bitcoin stance by, in the country, didn't have that same level of adoption that, that, that we witnessed in, in El Salvador. sorry, in, in Berlin. In Berlin. In El" }, { "speaker": "dr_padraig_corcoran", "time": "19:21", "start": 1160.87, "text": "Salvador, yeah. I know, I know there's a pretty strong community there, and I know they've been really driving hard, and it's maybe a point of pride for them Merchants who take Bitcoin in that area compared to other areas?" }, { "speaker": "stephan", "time": "19:34", "start": 1174.14, "text": "Yeah, so that seemed, seemed to be, seemed to be the case, because we didn't see that level of adoption in other regions, in our, our urban areas in El Salvador." }, { "speaker": "dr_padraig_corcoran", "time": "19:45", "start": 1185.06, "text": "Yeah. Now, one other thing, I, I, I might ask this also because- What about the case where merchants are using or accepting Bitcoin without knowing it, right? So as an example, in the Czech Republic, there's this thing, I think it's called, I don't know how to pronounce it, QRKO, Q E R K O, and so it's like, you know how when you go to restaurants and you scan a QR to get the menu, and you can also pay on that same thing? I think they've got a similar system like that in some parts of the world. Is that, I presume those are also being built into BTC map, but I'm not a hundred percent sure there." }, { "speaker": "stephan", "time": "20:20", "start": 1220.07, "text": "I'm not, not a hundred percent sure either." }, { "speaker": "dr_padraig_corcoran", "time": "20:23", "start": 1222.71, "text": "Yeah, okay. Because that could be where maybe the shop isn't natively taking Bitcoin themselves, but it's kind of happening in the background through their payment provider. And I guess now in the case of Square in the US, I think it-- there is a hookup there. Like Square is actually hooked up with BTC Map such that when that merchant turns it on, it will even show in BTC Map, and they'll even-- I think even inside the app you can see-- I think, I'm not 100% sure 'cause I'm not an American, I don't have Cash App, but I believe you can see on the local map merchants around there who take Bitcoin. So any, thought on that?" }, { "speaker": "stephan", "time": "20:59", "start": 1258.56, "text": "Yeah, I think that's, that's good that we have this, we have Square system talking directly to BTC Map, which definitely improves the, the quality of the data. So if a merchant turns on their accepting status, then that will hopefully immediately be represented in, in BTC Map. And likewise, when they- No longer accept Bitcoin if and when, then that will immediately be, be represented in BTC Map, because one of the greatest challenges with, with, with, with BTC Map is trying to ensure the quality of the data, right? To keep it up to date. Yeah. The data, and because, you know, it's, it's a moving target, so merchants are joining and leaving, predominantly joining at the moment, so, so, BTC Map have a system where they try to verify Merchant frequently, at least every twelve months, to confirm that it is, is still accepting Bitcoin payments. So if we had Square system talking directly to, to, to the BCC map, the-- or OpenStreetMap dataset You know, we wouldn't need that, that person in the middle to, to do the manual verification, so that would definitely help a lot." }, { "speaker": "dr_padraig_corcoran", "time": "22:10", "start": 1330.42, "text": "Yeah. And so I guess, d- are there any other insights that you see on Bitcoin communities and here, like circular economy communities or just like the meetup group in that town, do you see anything there? Like maybe if there's like a strong meetup group that has got a lot of people in that meetup, that maybe that town is gonna have higher quality data because there's obviously more, you know, Bitcoin Maxi's around." }, { "speaker": "stephan", "time": "22:32", "start": 1352.12, "text": "Yeah. Has this concept of, of a community where you can create your own communities and have kind of meet-mapping parties, let's say, where you try to go out and map, the local region, but, but they, they seem to be, yeah, really strong Really kind of very influential in, in ensuring the quality that you have a large community of individuals, so it's not just falling under responsibility of one person. So, so there is that community structure within, within the BTC Map project, I think that, and, and, That plays a strong factor in ensuring the quality of the data." }, { "speaker": "dr_padraig_corcoran", "time": "23:12", "start": 1392.3, "text": "Yeah. And I guess, is it then also a corollary of the point you were making earlier that, let's say, whether those states in the US had an SBR bill or not didn't really impact on the ground merchant adoption? I guess the, the corollary would be, does that mean circular economies can exist easily without national, without government, national top-down adoption?" }, { "speaker": "stephan", "time": "23:38", "start": 1417.98, "text": "I think they can, but we need to ensure that ideally the government isn't adversarial with respect to adoption. Some government top-down support helps, but it's not necessary. Once they're not, putting in roadblocks, I think we can still have adoption as a medium of exchange quite successfully if we have enough of Grassroots social network, community-driven initiatives to, to onboard merchants and educate them on the benefits of, of using it as a medium of exchange. And also, you know, as, like you mentioned before, it's very dependent on, having good payment systems built on top of Bitcoin, like, like the li- like the Lightning Network. I think as that technology, Lightning Network is great, but it has some limitations. I think as that technology continues to improve and develop, it'll become easier to, to on- Onboard merchants because the UX will be much easier both for merchants and customers to use." }, { "speaker": "dr_padraig_corcoran", "time": "24:36", "start": 1476.16, "text": "What can policymakers learn from your findings? If you had to, you know, say anything to a policymaker in either a region or, country, is there anything that they should keep in mind from your research?" }, { "speaker": "stephan", "time": "24:50", "start": 1490.41, "text": "Well, I think you, you can't legislate adoption, I think that, that's important. That's one finding, because even if you have legislation Which, which is very pro-adoption of Bitcoin, it doesn't necessarily translate into adoption by merchants and customers. So you need to educate and, and encourage, the bottom-up communities. So it has to be a mixture of top-down and bottom-up, I believe." }, { "speaker": "dr_padraig_corcoran", "time": "25:20", "start": 1519.71, "text": "When it comes to the type of business, do you notice any trends there? Like, is it typically hospitality? Is it typically cafes and bars and restaurants that you see on Bitcoin Map and BTC Map? Is there a reason for that? What do you think?" }, { "speaker": "stephan", "time": "25:34", "start": 1533.78, "text": "Okay, so, so we found that predominantly, or the majority of merchants were in the hospitality sectors, like as you mentioned, bars, restaurants, cafes, and we can only kind of hypothesize or speculate why that is the case. So- So one thing that it tells us is that, because these are very customer-facing industries, it suggests that the technology is sufficiently developed So the UX is sufficiently developed that it can be used quite easily by merchants and customers without creating any roadblocks. We also hypothesize that maybe some merchants are using it as, as, as a mechanism because it's customer-facing business, they're using it as a mechanism to try to attract a different Persona of customers, those who are interested in Bitcoin, so if they potentially stick a, a sticker on their, on their business saying that they accept business, accept Bitcoin as payment, maybe that attracts a different type customer to their business. We also found that there was quite a lot of merchants in the technology industry who were using Bitcoin as a medium of exchange, and we hypothesized that this is because people in this, the tech industry, you know, they, they understand the technology and the benefits of Bitcoin and also have the technical expertise to, to integrate it into their payment systems. Interest, another interesting thing that we found is that in the health, health, health sector, we found that there was a lot of merchants in the alternative health sector who were accepting, relatively a lot of merchants in the, in the alternative health sector that were accepting Bitcoin as, as payment, and that was quite interesting because there has been, have been some previous studies that have found that a correlation between libertarianism and an interest in the use of Bitcoin. So, and that seems to be present here because generally accepted that there is a kind of a correlation between alternative me-- medicine and- Libertarianism." }, { "speaker": "dr_padraig_corcoran", "time": "27:35", "start": 1655.23, "text": "Yeah, interesting. It's kind of like how a bunch of yoga people tend to be into like veganism, as an example or whatever, like there's just like correlations that you'll find. So obviously, people who are more libertarian minded will be more inclined to accept Bitcoin as kind of just an obvious thing. What about," }, { "speaker": "dr_padraig_corcoran", "time": "27:52", "start": 1672.2, "text": "This kind of-- there seems to be a narrative that, oh, Bitcoin is only used for saving, it's not really used for payments. Is that really true based on your findings? Or not true?" }, { "speaker": "stephan", "time": "28:01", "start": 1681.49, "text": "It's difficult to, difficulty, difficult to say conclusively. So we've just, as I said at the start, we've just mapped or done analysis of merchants accepting Bitcoin. We don't know the volume of payments they actually process." }, { "speaker": "dr_padraig_corcoran", "time": "28:15", "start": 1694.52, "text": "Gotcha. Yeah. 'Cause they could just put it up and not actually get that much volume, or on the other hand, they might actually get a decent amount Or they organize their made ups there or things like this." }, { "speaker": "stephan", "time": "28:25", "start": 1704.64, "text": "So, so we did look at, so we looked at a couple of, because the, the quality of the data varies kind of over space and time, we picked a couple of, a small, a couple of geographical regions where we were confident that the data was of good quality in the sense that there was a large number of merchants in that region and they had all, who had been mapped in that region and the vast majority of them had been verified in the previous twelve months. So we picked, we looked at the regions Prague and also, Berlin and El Salvador. So, so we looked at, the number of merchants in those regions and, and looked at the percentage of the total number of merchants in those regions. So, so in, in Prague, we found that in the case of restaurants Six percent of all restaurants in, in Prague accepted Bitcoin payments, while in Berlin it was, over seventy-five percent of merchants in that region accepted. Which is" }, { "speaker": "dr_padraig_corcoran", "time": "29:23", "start": 1763.48, "text": "incredible when you think about it, right? Like the level, the, the sheer number, the sheer percentage. So I guess, I guess the other question that I'd have for you, and I'm not sure if you looked at this, What about merchant drop-off, right? Because this is another thing historically what we might have seen is sometimes like people get really overzealous and they're out there trying to orange peel merchants, get them all on boarded, but then there's not enough people actually spending. So then after a little while, the merchant turns it off, you know, they drop off, let's say. So maybe that's something that might come out in the data over time of, oh, okay, maybe there was like a burst of activity and then it kind of drops off and then, you know, people stop, or," }, { "speaker": "stephan", "time": "30:05", "start": 1804.7, "text": "We find that adoption is, is growing over time. So this data, that I, I used the data at a fixed time stamp in my paper in, twenty twenty-four, I think was when I, the cutoff date for my analysis, and we, in, at that time there was eleven thousand merchants represented in the BCC map, and just as of the first of January this year, there's closer to almost double that number of merchants represented in, in, in, in BTC. So adoption seems to be growing almost exponentially. If you, if I've plotted the curve, it's really shooting up, particularly in recent months. I'm not too sure the reasons for that, but that's, that suggests that, you know, there might be some merchants that are dropping off, but they're far outweighed by the number of new merchants who, who are coming in. So, so adoption seems to be growing. Gotcha. So there's" }, { "speaker": "dr_padraig_corcoran", "time": "30:57", "start": 1856.95, "text": "some churn factor, but it's growing still dramatically. And I, it kind of makes sense if you just think about the recent news, right? The, you know, block with up, I think it's up to four million merchants, who could turn it on. I believe that it's an option, so they may not all turn it on, but still, that's massive. And then, the other big one, which I had an episode with Karel from Money Badger in South Africa, he turned on seven hundred thousand locations. Which is just incredible when you think about it. And so now some of that is because it's, it's being turned on in a way that the merchant doesn't really have to do a lot, right? It's just kind of, it's, it's like a small, it's like one of the payment options that they already had anyway, and then he managed to find a way to sort of plug into that, so it doesn't require like training that receptionist or that staff member on the ground, okay, here's how you do the Bitcoin payment. Like historically, that's what it used to" }, { "speaker": "dr_padraig_corcoran", "time": "31:49", "start": 1909.27, "text": "How to do it and all these other things, whereas now, you know, with Lightning Network, better systems, better technology, it's all improving." }, { "speaker": "stephan", "time": "31:56", "start": 1915.93, "text": "Yeah, for sure. I think we can get kind of these kind of step shape. So currently at the moment, it's kind of gradual continuous growth over time, whereas we have these larger, you know, point of sale organizations coming in, such as Square, that we can just get a sudden step change in the number of merchants, you know, you know, or, very, very quickly. So, so adoption Buy merchants doesn't have to continue the current trend of gradual, of gradual increase, we can potentially get those step changes when we get these larger organizations coming in." }, { "speaker": "dr_padraig_corcoran", "time": "32:30", "start": 1950.12, "text": "So if you were advising Bitcoin only builders, where should they focus? Wallets, merchant tools, community building? What do you think?" }, { "speaker": "stephan", "time": "32:39", "start": 1959.33, "text": "Well, I think a, a combination of all. I think You know, in order to, so Lightning Network has really important as a payment system for, for merchants to accept payments because on-chain transactions, they just, they don't scale in terms of, the latencies of, latency of the transaction and also the cost of transaction. So, so these payment systems such as the Lightning Network are really, really important. Whilst that, the Lightning is great, but there is potential to improvement. There are lots of challenges around liquidity management and so on and so forth. So, so obviously we need to, if we can Can improve the payment systems, improve the Lightning network, will be e-easier to, to, to onboard merchants, giving a better UX to everybody. And so we need to improve the technology on one end, but that goes hand in hand in, in, with the, with the education and building community, communities which promote the adoption of Bitcoin as a medium of exchange." }, { "speaker": "dr_padraig_corcoran", "time": "33:35", "start": 2014.98, "text": "How has working on this research changed how you personally think about Bitcoin as money?" }, { "speaker": "stephan", "time": "33:41", "start": 2020.7, "text": "Yeah, so well, it's kind of, it's kind of a little bit in reverse. So, so, I, I became very interested in Bitcoin, and I would say Bitcoin actually changed my research more than my research changing my perspective on Bitcoin. I was very, very," }, { "speaker": "stephan", "time": "33:58", "start": 2038.36, "text": "a, a very pro-Bitcoin, and that changed, the focus of my research was influenced by that. So, so kind of the influence flowed in the opposite direction," }, { "speaker": "dr_padraig_corcoran", "time": "34:07", "start": 2046.96, "text": "let's say. Yeah. And, I think- I think what we are finding is just people from all walks of life, right? Doctors and lawyers and CEOs and investors and, you know, university, you know, professors like yourself, researchers, are finding Bitcoin and they're making their own contribution in their own way, and then, you know, as these papers that you write and do and research Get out there, then more people find that, and it gives a new level of legitimization, and then there's a whole new round of people who sort of see that and think, \"Oh, okay, well, you know, it's, it must be legit. There are people doing papers about it, and, you know, there are legit communities and builders and merchants and people using it.\" And so I think it's all, it's all part of the process. So it's, yeah, it'll be really interesting to see, you know, how things develop. I know it is" }, { "speaker": "dr_padraig_corcoran", "time": "35:01", "start": 2100.58, "text": "Some ways, but I, I mean, for me, I'm, I'm in favor of both, like let's, let's do both. And so I really see that as the way it's gonna go. I think the other thing is people sometimes forget that if, if you're a merchant, that's how you can stack Bitcoin, right? So that for them, it could also be the store of value, right? It's just, that's just how they're earning their Bitcoin. So I, I think these are some of the things that we'll see there. Any final comments or any" }, { "speaker": "stephan", "time": "35:30", "start": 2130.17, "text": "Yeah, so I've been doing, as I mentioned at the start, I, I've kind of been have two research directions in this space. More recently, I've been focusing on this analysis of, mapping using crowdsourcing data, merchants accepting Bitcoin, Bitcoin, but I've also done a lot of work on some of the theoretical problems in the Lightning Network and trying to improve the algorithms and systems there. So I've done, done a lot of research on that space as well. But, yeah, I think there's lots of, you mentioned academics working on Bitcoin, I think it's It's great, like, I'm a computer science scientist working on Bitcoin, I think irrespective of, of your academic discipline, there's l- so people from lots of different discipline, academic dis-disciplines can contribute to, to, Bitcoin. There's lots of interesting and open research problems which are very impactful that, that academics can contribute to." }, { "speaker": "dr_padraig_corcoran", "time": "36:21", "start": 2181.05, "text": "Fantastic. Well, I will put the links in the show notes and listeners, you can follow Porik on X, P Corcoran 9. Obviously, links will be in the show notes. Porik, thank you for, joining me on the show today and sharing your insights." }, { "speaker": "stephan", "time": "36:36", "start": 2195.77, "text": "Okay, thanks for having me, Stefan." } ] }