Bitcoin Foundation

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The Bitcoin Foundation is an American nonprofit corporation. It was founded in September 2012 with the stated mission to "standardize, protect and promote the use of Bitcoin cryptographic money for the benefit of users worldwide."[1] The organization was modeled on the Linux Foundation and is funded mainly through grants made by for-profit companies that depend on the Bitcoin technology.[2] The Foundation and its leadership have been criticized by the media.[3]

History

The Bitcoin Foundation was announced on September 27, 2012.[4]

According to its founding documents, the Bitcoin Foundation's original members included Gavin Andresen, Charlie Shrem, Mark Karpelès, Peter Vessenes, Roger Ver, and Patrick Murck. Current board members are divided into one of three categories: Founding Members, Industry Members, and Individual Members. The board is made up of a combination of elected members of the aforementioned categories. Gavin Andresen is employed by the foundation as "chief scientist."[2]

California DFI error

In June 2013, the California Department of Financial Institutions had erroneously considered the Bitcoin Foundation to be a money transmitter and sent them a letter requesting that they "cease and desist from conducting the business of money transmission in this state,"[5] which prompted a detailed response to the regulators.[6] The California DFI dissolved several days later.[7]

United States Senate assessment

In November 2013, Patrick Murck, general counsel of the Bitcoin Foundation, testified before a United States Senate committee convened to assess digital currencies, at which the reception of Bitcoin by lawmakers was generally positive.[8]

Criticism

The Foundation and its leadership have been criticized by some in the media.[3][9] Former vice-chairman Charlie Shrem pled guilty to aiding and abetting the operation of an unlicensed money-transmitting business related to his role in assisting agents of the online marketplace Silk Road.[10][11][12] Executive chairman Peter Vessenes' business relationship to former board member Mark Karpeles, the former CEO of collapsed Bitcoin exchange Mt. Gox, has been highlighted as inappropriate.[9] The Foundation has also suffered scrutiny and resignations over its hiring of former child star Brock Pierce.[13]

In November 2014, the Bitcoin Foundation announced that it would seek to wind down its education, outreach and public policy initiatives as it turns its focus to core development. Three surveys conducted earlier by the Bitcoin Foundation suggest that many community members, both inside and outside of the organization, want to see it adopt a stronger focus on bitcoin’s open-source technology development. [14] The Bitcoin community itself is divided over the role of the Foundation as a community or industry representative.[3] Some libertarian Bitcoin advocates have criticized the organization's strategy of political lobbying and participation with federal regulators.[3] In November of 2014, Cody Wilson announced his run for board seat in the Bitcoin Foundation, stating "I will run on a platform of the complete dissolution of the Bitcoin Foundation and will begin and end every single one of my public statements with that message." [15]

Professor and author Mark T. Williams criticized the Bitcoin Foundation's priorities, writing in a Business Insider editorial that "A Foundation of 'B' players has no business claiming it is a protector of a system that remains vulnerable and untrustworthy."[16]


External Links

References

  1. Matonis, Jon (27 September 2012). "Bitcoin Foundation launches to drive bitcoin's advancement". Forbes. http://www.forbes.com/sites/jonmatonis/2012/09/27/bitcoin-foundation-launches-to-drive-bitcoins-advancement/.
  2. 2.0 2.1 Bustillos, Maria (2 April 2013). "The bitcoin boom". The New Yorker. http://www.newyorker.com/online/blogs/elements/2013/04/the-future-of-bitcoin.html. Retrieved 30 December 2013.
  3. 3.0 3.1 3.2 3.3 Neal, Meghan (12 May 2014). "Bitcoin is Hiring Lobbyists". http://motherboard.vice.com/read/sorry-cypherpunks-bitcoin-is-hiring-political-lobbyists. Retrieved 16 May 2014.
  4. BitcoinTalk thread 113400. [ANN] Bitcoin Foundation 27 September 2012.
  5. McMillan, Robert (24 June 2013). "California says the Bitcoin Foundation is a money-transferrer". Wired. http://www.wired.com/wiredenterprise/2013/06/california_dfi/. Retrieved 31 December 2013.
  6. Spaven, Emily (3 July 2013). "Bitcoin Foundation issues response to cease and desist warning". CoinDesk. http://www.coindesk.com/bitcoin-foundation-issues-response-to-cease-and-desist-warning/. Retrieved 31 December 2013.
  7. "About Us". California Department of Business Oversight. http://www.dbo.ca.gov/About_DBO/default.asp. Retrieved 15 March 2014.
  8. Lee, Timothy (23 November 2013). "For Bitcoin, a successful charm offensive on the Hill". Washington Post. http://www.washingtonpost.com/business/economy/for-bitcoin-a-successful-charm-offensive-on-the-hill/2013/11/22/000ed4b0-53b1-11e3-a7f0-b790929232e1_story.html. Retrieved 24 November 2013.
  9. 9.0 9.1 Tiku, Nitasha (March 7, 2014). "Whistleblower Threatens to Expose Corruption at Bitcoin Foundation". http://valleywag.gawker.com/whistleblower-threatens-to-expose-corruption-at-bitcoin-1538965958. Retrieved May 16, 2014.
  10. Jerving, Sara (September 6, 2014) "Bitcoin Promoter Charles Shrem Pleads Guilty" The Wall Street Journal
  11. Hill, Kashmir (January 27, 2014). "Winklevosses, Bitcoin Community Shocked By Arrest of BitInstant CEO Charlie Shrem". http://www.forbes.com/sites/kashmirhill/2014/01/27/winklevosses-bitcoin-community-shocked-by-arrest-of-bitinstant-ceo-charlie-shrem/. Retrieved May 16, 2014.
  12. Jeffires, Adrianne (January 28, 2014). "Charlie Shrem resigns from the Bitcoin Foundation after arrest". http://www.theverge.com/2014/1/28/5354328/charlie-shrem-resigns-from-the-bitcoin-foundation-after-arrest-bitinstant. Retrieved May 16, 2014.
  13. Menn, Joseph (May 16, 2014). "Bitcoin Foundation hit by resignations over new director". http://www.reuters.com/article/2014/05/16/us-bitcoin-foundation-resignations-idUSBREA4F02B20140516. Retrieved May 16, 2014.
  14. Higgins, Stan. "Bitcoin Foundation Pledges to Focus Solely on Core Development". coindesk.com. http://www.coindesk.com/bitcoin-foundation-shift-core-development/. Retrieved 19 November 2014.
  15. del Castillo, Michael (22 December 2014). "It's official: Cody Wilson is trying to destroy the Bitcoin Foundation from within". Upstart. http://upstart.bizjournals.com/entrepreneurs/hot-shots/2014/12/22/it-s-official-cody-wilson-is-trying-to-destroy-the.html?page=all.
  16. Williams, Mark T. (25 February 2014). "Mt Gox: The tower of toxic sludge". Business Insider. http://www.businessinsider.com/mark-williams-bitcoin-lehman-brothers-type-event-2014-2.