Understanding Blockstream

Understanding Blockstream


I have been involved with Bitcoin in some capacity since late 2011 and had multiple pull requests merged into Bitcoin Core. I have done consulting work with several companies including Blockstream, a place where there are many good people at and some not so good. I recently stopped doing working with them mostly because bitcoin prices have gone up and I can work on other projects. It has been funny to read the conspiracies on twitter and reddit about Blockstream so let me explain a few things.

Blockstream has about 50 employees spread around several cities about 35 of whom (plus contractors) more or less report to the CTO, Greg. The other 15 or so are involved in business development, operations, PR, and everything else.

Most people think of Blockstream as a software company but it also has a new hardware division too and it wants to build multiple different products. (here is one of the jobs: http://jobs.khoslaventures.com/jobdetail.php?jobid=698427)

Some advertising has been done around the Liquid product. It uses off the shelf hardware and creates a federated chain to confirm transactions in a few seconds. Last I heard Liquid is being used by about 10 exchanges and they want to build a new custom version of the hardware but because I was not on sales maybe that number is higher.

Another hardware product they want to recruit for is for Confidential Transactions, making them faster to create. And one other product is a high end type of hardware wallet to secure private keys. All pretty useful and helpful stuff and will take some time to design and build.

Every organization has its rough side too. When I was there senior Blockstream people complained a lot about Zcash, Ripple, Ethereum, Chain, and many other companies and projects they view as scams or not legitimate. Basically every company not doing work on Bitcoin itself. And even many companies that worked on Bitcoin like Coinbase and Bitpay they did not like the executives. Many of these projects are dumb and broken like Parity and you do need real scientists and engineers to make sure things don't break. But one thing I noticed was that Blockstream doesn't do well with others, they have no real partners so that probably leads to a lot of the conspiracy theories. And the few partners they have, like developers in Milan are aggressive and confrontational online and at events. When I attended the Milan scaling event it seemed like the local organizers were just a bunch of angry men who hated different cryptocurrencies more than solving Bitcoin issues.

Internally the team has some really smart developers who work on many different things that interest them and are not directly related to Bitcoin or the company. Behavior is about to be as expected from a startup. Some people openly did drugs like Johnny Dilley and Austin Hill. If you do much work at tech startups that is not exactly strange to see. One thing that is a bit different is the amount of time the senior people spent on twitter and reddit each day. We used to joke that if you could not get a hold of management through email or slack that all you had to do is post a trolling comment on reddit and Greg or Austin would immediately respond to it.

Blockstream is usually frugal with its money. It even still has bitcoins it bought in 2014 which have gone up a lot. But Austin got fired as CEO last summer. He was forced out by the board not for drugs but because he could not present a real business plan to the investors. What we heard is that they stripped him of all his roles and did not even let him stay as a advisor. The only reason this became public is because reporters were asking questions last fall and a press release was rushed to make Adam Back the official CEO when that was not the plan. Adam was going to be just a temporary CEO because of his non business background but maybe Austin will come back now that he is talking again: https://www.reddit.com/user/austindhill

Some of the developers complained internally that our business team did not know what to do with our technology. Earlier this spring BitGo announced it was working with CME and Royal Mint on a gold product. That deal is what we had been working on last year. We lost the bid partly because we do not know how to partner and I think that is because most of the senior people just don't have the background in doing business and are too focused on arguing about technology.

About reddit conspiracies: I don't think Peter Todd is an actual employee though he does spend a lot of time talking and coordinating with people on the team. I left before the Antbleed mining announcement and was told he and Samson worked on that together. That's the kind of stuff Blockstream management spends its time on instead of building out use cases like the gold product for CME. One joke someone said right after Samson started officially working at Blockstream was at least we could make money selling clothes. We don't know why didn't they hire someone with a business background from a successful company. He left BTCC after the crackdown from the Chinese government and still runs another company called Pixelmatic. Pixelmatic doesn't look successful so I don't how can he focus on the business strategy though I have one of his hats so maybe clothing lines will do good.

One last piece of advice, the AXA conspiracy stuff is just dumb. If AXA really wanted to control Bitcoin and was as powerful as Roger and everyone claims that they are, then they could just get the Chinese government to tell the miners and exchanges to do what they wanted. If you don't like Blockstream instead of shouting about it at each other with fake accounts you should reach out to the board members and board observers like Reid Hoffman. There are some good and some bad people at Blockstream, you should talk to their shareholders if you really wanted changes. He is one of the largest investors and has said he is against types of harassment. If he does not think the online behavior of senior people at Blockstream is harassment, then you are just wasting your time. They are also hiring so you could help shape the company that will be around for a long time.