LET’S TALK BITCOINEpisode 76 – Politics and Charity

Participants:

Adam B. Levine (AL) - HostStephanie Murphy (SM) – Co-hostSteve Stockman (SS) – CongressmanConnie Galllippi (CG) – Founder and Executive Director of the BitGive Foundation

AL: Today is January 17th 2014. Welcome to Episode 76 of Let’s Talk Bitcoin, a twice weekly show about the ideas, people and projects building the digital economy and the future of money. Visit us at www.letstalkbitcoin.com for our daily guest blog, all our past episodes and, of course, tipping addresses.

My name is Adam B. Levine and today we’re talking about the possibilities to really shake things up in the United States. Connie Gallippi is the founder and Executive Director of the BitGive Foundation. Recently Stephanie caught up with Connie to talk about her origins, women in Bitcoin, the potential for charity, the types of help they need and, of course, lots more.

First, Congressman Steve Stockman joined LTB’s Jonathan Mohan at the recently opened New York Bitcoin Center, on New Year’s Eve for a wide ranging talk on Bitcoin’s disruptive potential and the possibility of a Bill that will make everybody leave Bitcoin alone for at least a year or so. We’ll get right into it. Enjoy the show! [1:07]

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Jonathan Mohan interview with Congressman Steve Stockman

JM: I’m joined right now with Congressman Steve Stockman at the New York Bitcoin Center on New Year’s Eve. Thank you so much for coming out. [1:20]

SS: This is like the greatest party, the smartest people, a really vibrant party and I’d rather be here than Times Square, any day. [1:29]

JM: (Laughter) So glad to hear that. Can you tell me a little bit about your background and what you like about Bitcoin? [1:34]

SS: I was in Congress in the ‘90s and then, for almost a generation, I was not in Congress. I took care of my dad who has Alzheimers and he passed away. I got back involved in Congress and I wanted a seat in Texas called District 36. Texas picked up four seats and one of those open seats was District 36, which represents Houston and goes all the way over the Louisiana border and part of ... if anybody knows Charlie Wilson, it was Charlie Wilson’s old seat. We have about 87 refineries and we produce half of all the gasoline in the United States. [2:07]

JM: What was your process about learning about Bitcoin? [2:12]

SS: Well, I’ve always been interested in technology that changes, fundamentally... dynamic changes. I think things such as the 3D printer, nanotubes and Bitcoin are going to be .... are called industry disruption, which changes things fundamentally. It’s a very exciting time to live in the world today because of these upcoming technologies. Currently right now, if you look at Bitcoin and the history of Bitcoin, it wasn’t started out as a sea-change but if you look at the future and the possibilities of Bitcoin, it will be a fundamental change, it could be a world currency much like the dollar is, only I think it would be more efficient and a greater capacity than the US dollar. I’m not saying it’s going to replace the dollar, however, I think it will eliminate a lot of barriers and increase commerce which is always a good thing for the world and individuals. [3:13]

JM: (Laughter) For someone who is in politics, it’s kind of refreshing to hear someone be so free market. What do you see as the place for regulation of Bitcoin in America and how do you think regulation could affect America’s place in the Bitcoin community? [3:28]

SS: I think there is some concern that if you put Bitcoin on your laptop page, you may have someone hack your computer and steal it. There’s also the question of taxation which, I personally think, that if you look at the Internet, there was no taxation of the Internet because the argument at that time was that it was a small industry; that you needed to let it grow organically and without interference from the . I would argue that Bitcoin is similar in that if we interfere in the market in the way it develops, you could interfere with industries yet known. No one predicted that the Internet would be such a sea-change. I mean, it changed the way airline tickets are; it changed the way newspapers are; it’s just changed the world. That is true of Bitcoin. The potential there is great but if we stomp on it and eliminate it in its infancy because of threats to people that are in power, we could eliminate a lot of industries and, quite frankly, a lot of jobs. [4:25]

JM: What’s your take on the alphabet soup of government agencies that are here to protect us? Like their opinion of Bitcoin... when they say – Hey look, you have Silk Road out there. How is it that you’re able to see past that when a lot of your other Congressmen, kind of, don’t? [4:40]

SS: Well, let’s think about this. Everybody that’s in government that’s...particularly that’s... what is called administrative law – if their purpose to be administrative law is to create laws without really the preview of the Congress, if you have someone that’s in administrative law in developing and pushing the agenda, then when you strip them from their power that eliminates, really, the functionality of the purpose of their job. They feel threatened by

anything that liberates individuals. I’m for liberation of individuals. In fact, I have a hard time, being a democratic Republican, why you vote for someone to say, for instance – I’m fat, I want to reduce the number of calories, therefore, I’m going to go out and vote for somebody that’s going to pass a law that says I can’t eat. It’s puzzling to me. It’s much more simpler if you don’t want to eat, do that. Don’t impose this on other people; give people free choice. Currently, the way it operates, people vote for people that pass more laws, more restrictions. Throughout the world, if you do an analysis of the countries which are the most free, they are the wealthiest. Individuals make better choices for themselves than having someone up in Washington making choices for you. [5:54]

JM: I know there are a lot of anarchists and hardcore libertarians who say – Well, the best way that Bitcoin can get on White House on Capitol Hill, is just to completely ignore it and have them deal with it on their own. For the people who want to engage civically, as it relates to Bitcoin, how could we do that? [6:10]

SS: I would suggest that they do, like many other organizations, whether it’s a gun rights group or international group, that you do a survey and send it up to all the Congressmen and Senators that are running for office – Independents, Democrats, Republicans, Libertarians and ask them where they stand. It’s not fair to judge someone without knowing where they stand. If you know where they stand and they’re against it, then that’s fine to criticize them but you may have many more allies than you realize so the best thing is, is communicate and do that through a survey. A politician is just a person who decided to run for Office. They eat, they breathe, they go to bed. They’re not evil people. There are some evil people but, by and large, they are just normal people who work really hard and I would recommend that you ask them. In the beginning, you won’t get a lot of answers in your surveys but publish that – Refused to answer. As time goes on, there will be more and more people starting to answer and your issues and concerns will be brought forward. I would recommend communicating through surveys and getting their opinions. If you don’t do that, it’s not really fair to criticize someone if you never asked them. [7:15]

JM: Right. You know, kind of the fear when it comes to the entrepreneurial and the tech literate community is that Congress has a habit of litigating on a topic when they are not fully informed. [7:28]

SS: They litigate twenty years after it’s relevant. (Laughter) They’re just now learning about fax machines. (Laughter) [7:34]

JM: There are some laws that affect the Internet that predate the Internet and we kind of are afraid about what they might do... like even if we were to engage them and they are like – OK, this is something that I need to make a part of my campaign. They are not going to go the extra step of actually learning about it to make that informed decision. [7:52]

SS: In fairness, tonight I met a lot of people who want government interceding on behalf of Bitcoin and that’s a double-edged sword. If you want government to step in, in addition to being positive, you’re going to have some negatives. If you create a governmental body to oversee Bitcoin, then that governmental body will be dictated by the people in power. My concern is, is that if you create a governmental body to intercede on Bitcoin, then you will

upset the whole purpose for which you have in Bitcoin. I think the purpose of Bitcoin, in my view, is fundamentally the freedom of individuals and to keep them free. Now, if you start interfering and suggesting that government interferes, much like they do in schools. They say – Hey, we need government to do this. All of a sudden the parents start realizing – Hey, we don’t have access to what our kids are studying; we don’t have access to the tests they’re taking but we want government to pay for it. It’s a two-edged sword. I’d be very cautious asking government to intercede. I would like to see the Bitcoin community become a self-regulation and to outline some basic principles to operate by. Tonight I met, ironically, very many Libertarians wanting government which, to me, is fundamentally different than what Libertarians stand for. Be very careful when you ask government to intercede. It’s a two-edged sword and you may regret asking the wolf (?? Inaudible) chicken hatch. [9:22]

JM: We’re kind of at the Eye of Sauron here in New York when it comes to financial law. When it comes to operating a Bitcoin business, it currently... FinCEN states – You’re a money transmitter. In New York states, we are granting no money transmitter licences to Bitcoin companies. It’s sort of this draconian Catch-22. [9:39]

SS: It’s a very frightening thing. If you’re in the industry... well, think about it. The brick and mortar industry. At first, ignore it and then they felt threatened. Look at the music industry. Remember, until Steve Jobs came up with iTunes, they were being decimated in the industry and it’s still having changes. [10:00]

JM: There’s actually a recent study that found that the people who pirate music actually do it on a music that is harder to find and that the people who are more likely to pirate actually spend more on music than the average consumer. There is actually now evidence to even show that as it relates to piracy, it actually increases purchasing of music because what happens is you (?? Inaudible) sample it and then you buy it. [10:22]

SS: Exactly, but remember what happened. The industry felt threatened and they started suing people. You had similar circumstances here as when you create a currency, technically, a computer currency, the people who feel threatened are the people that have influence over the dollar. If you start saying – Well, we’re threatening the dollar, you’re going to have a lot of people in power and very powerful places that feel threatened. It may not be actually threatening them and I think they can co-exist, but the perception of a threat will dictate action. We have got to be very careful we’re not threatening the dollar currency but it is a competing way to free the markets. [11:02]

JM: When we’re talking about competition, I love the fact that people never see the dollar as a monopoly. Bitcoin is giving us this viable competitor to the dollar because you can’t shut it down, like you did with Liberty dollars. [11:14]

SS: (?? Inaudible) but right now you’re not printing $85 billion in Bitcoin every month. [11:20]

JM: What’s your opinion of this hundred year experiment called the Federal Reserve? [11:24]

SS: It’s ironic because we just celebrated the 100th year and, as you know, it was Wilson who also created the Federal Income Tax. He created a dragon with two heads and I would argue that we probably have lost unknown wealth, this nation. We’re going to soon follow behind China, in terms of wealth creation which is ironic because they are supposedly a socialist country which I think the reality is it’s more of a fascist country because they’re in joint operation with corporations. [11:57]

JM: I love this argument of calling another nation fascist when we pretend that Goldman Sachs doesn’t buy out both parties for residential candidates. [12:04]

SS: Well no. I would argue that we do have some fascism in that, the definition as I understand fascism, is the cooperation of government and industry. I’d have to say GE is very much in that mode, that they rely heavily on government and government intervention. Also AIG, (?? Inaudible), or it would be GM – we tease, it’s called government Motors which, by the way, the mainstream media say we lost no money on. That’s an absolute lie. We lost billions of dollars and they said – Well, it was a great, successful experiment but on the other hand, we don’t know what would have happened if it was diminished. Would there have been a new industry that was created better than what we got? [12:41]

JM: This Bill that you’re proposing – what is it and how do people (?? Inaudible)? [12:46]

SS: Here’s exactly what I want to do, then get on our website and give us feedback. [12:51]

JM: And your website is? [12:52]

SS: www.Stockman2014.com. The thing is, you should have seen that, we get it but what I want to do is I want to include the comments. Now, I know whatever Bill we’re going to introduce, people are going to be ticked off, but at least it starts a conversation and it creates awareness. My main goal of the Bill... [13:10]

JM: To just interject – for all those trolls out there, you just heard a Congressman say that Internet comments will be read. If you go to www.Stockman2014.com, he’ll actually have... [13:18]

SS: Well, we’ll get someone to read them, at least. (Laughter) ... but my purpose is to introduce a Bill to get the conversation going and protect the free market. [13:26]

JM: What’s the Bill about? [13:27]

SS: I think there are 44 States that are controlling Bitcoin right now in various ways, (?? Inaudible) the currency. There are different various government agencies and I’d like to pass a federal law that says – Until this Bitcoin is germinating into a full industry, just like the Internet, allow it to be free and allow it to be developed. [13:48]

JM: The ‘Leave Us Alone’, ‘Don’t Tread On Me’ Bitcoin Bill? [13:51]

SS: Well yeah. I mean, that’s what we want, right? We want to see this develop into an industry which creates new jobs, creates new industries. Just imagine if government, in the beginning, in the Genesis of the Internet, interfered? We wouldn’t have any... [14:06]

JM: Or put the Sales Tax on them. [14:08]

SS: Yeah. That’s what they wanted to do in the beginning and, in their wisdom, (believe it or not) the politicians said – No, we’re not going to do that in the beginning and allowed the Internet to explode into ways we can never imagine. [14:18]

JM: Do you have a name for this Bill yet? Or would people give you input? [14:21]

SS: I’ll name it after you. [14:22]

JM: (Laughter) Oh, great! [14:23]

SS: No, no. I think we should call it Freedom in Currency, or something like that. I haven’t named it yet but if you have a suggestion for a name, email us. [14:30]

JM: Certainly, if anyone has some input as they would like to have seen in this Bill. [14:34]

SS: Right and I know there’s a problem with taxation; I know there’s a problem with stealing, we’re just trying to balance the Bill. It’s not the perfect Bill but remember this, don’t let the perfect be the enemy of the good. [14:43]

JM: What’s your take on what Bitcoin can facilitate? One of the concerns is Bitcoin as it relates to capital flight. America, obviously it has its Exit Tax when you want to leave the country and expatriate, or there are all these other countries like, for instance, Cyprus which imposed great capital controls. One of the things that make Bitcoin so great is, with just a couple of letters and numbers; you can walk out of the country with your entire bank account. As it relates to capital controls, what is your opinion on Bitcoin? [15:12]

SS: There’s always government interference with individual freedoms. You’re asking me is it a good thing that government interferes with individual freedoms and I have to go back to saying, no. You’re blocking a system for which this nation and, actually quite frankly, the world. The United States is unique in that you can’t say we got our wealth from natural resources. We got our individual wealth because individuals participated in the ability to create geniuses. Steve Jobs did not get a government handout. Steve Jobs didn’t have a government intercede on his behalf. You see the government constantly trying to pick winners and losers. Look at (??). That was a government picked company that was supposed to succeed, but failed. We can’t have government interceding on behalf of commerce. Commerce does best when individuals pick the winners and losers, not government. Some guy, who has a government degree sitting up in Washington DC, is not the proper person to decide which industry should succeed or fail. The more free markets, the better it is for individuals. The greater the wealth round the world is indicative of free nations. It’s a direct correlation. I challenge anybody to disprove that. The United States

has more and more restrictions and as we get more and more restrictions, our GDP is down to 3%. China’s has been as high as 13/14%. What are we doing differently than China? Ironically, the socialists have less restrictions on capitals formation. Bitcoin’s going to create an economic engine which, unfortunately for the people that are currently in government, is going to be something they can’t control. [16:55]

JM: How best could we maximize the effect that Bitcoin can have on politics in America? [17:01]

SS: Again, I go back to what I’d like to see. It’s funny because tonight I think I met fifty different opinions, much like every Libertarian they have different opinions but they have to coalesce behind the individual freedom. I would hope that somebody gets together, maybe fortunately maybe here tonight, and get together and do a survey and actually talk to the politicians. Don’t be afraid. They are humans and say – Look; this is our argument for Bitcoin. Do you support us? Yes or no? If you set up a dynamic which is hostile to the people in charge, you’re going to get hostility back. I’m asking the people in Bitcoin to reach out to your Representative, ask some questions, don’t be afraid of them. Most of them won’t understand you; take the time to explain it. Take the time to explain the advantages of it. This is a fundamental change to the world and I’m honored to be part of this tonight in New York. I’m not from New York, I’m from Texas and this is one of the most exciting times of my life to say I was here. This is very much like Steve Jobs being in the garage. Could you imagine if you had the opportunity, would you want to be in the garage when Steve Jobs first invented it? I mean, come on. This is huge and to be here... I’m going to remember it fifty years from now, if I’m alive (I probably won’t be alive) but twenty years from now. I’m going to say – Hey, I was here in 2013 on New Year’s Eve when someone kicked off this phenomenon. I’m just honored I was invited here and honored that you would take time to want to talk to me. I work for the people. You don’t work for me, I work for you and having people express their opinions here tonight was so valuable. We intend to introduce a Bill, hopefully, which will cause conversations. There’s going to be a lot of people disagree with it but it’s with the ball forward. Don’t let the perfect be the enemy of the good. [18:43]

JM: One of the things that has so much of the Libertarians’ philosophical juice behind Bitcoin is this notion of amoral money. What I mean by that is it’s kind of like the difference between a diamond and a blood diamond where, when you purchase a blood diamond, you’re supporting an entire ecosystem, whereas when you purchase a diamond, it’s just that. When you purchase the dollar, when you hold your assets and dollars, you’re not just doing that. It is, in and of itself, a political act because you’re supporting the war on drugs which is the war on young, male minorities. If you look at the war on... [19:15]

SS: When the Internet first opened up, they talked about it being anti-war, right? Let’s face it, it was more... we look back now and it’s not anti-war, it has fundamentally changed the way we operate in commerce. I would argue that Bitcoin is... you can use the philosophical terminology but there’s industries yet to be known and commerce yet to be known that’s going to change this world. If that’s why you’re doing it, that’s fine. I don’t have a problem with that but looking out in the future, if you can predict the future, which we can’t, I would say my best guess is this is going to change the way we operate in commercial... This is why I say this is because, at some point, there’s going to be a total vacuum if the dollar becomes

like the Mozambique dollar where you’re printing out trillions and trillions and it would cost you $100 to buy a loaf of bread. People are going to gravitate towards precious metals and Bitcoin. [20:16]

JM: If someone wanted to know more about you or how to get involved with your political aspirations moving forward, how would they go about doing that? How would they reach out to you? How would the community in your district, as it relates to your Bitcoin constituents, reach out to you? [20:31]

SS: First of all, we’re going to put a Bitcoin... we already have... I think we already have a Bitcoin donation page but we also have, Nick our host, also has a Bitcoin QR code. [20:43]

JM: You’re going to be accepting Bitcoin donations? [20:46]

SS: Yes, but in terms of FEC, we may have to make sure we follow the law. [20:51]

JM: That’s the case with almost everything with Bitcoin is, you’d love to do it but... (laughter) [20:55]

SS: Here’s the thing is that we can change that through those questionnaires and talking to your politician. The way it is now is not going to be the way the future is. I mean, if we say that – Well, TV was black and white and it will always be black and white. No, eventually we got color television. I’m suggesting to you that the future is not here but if you invest in the future, it will come around. [21:18]

JM: For our American listeners, if they could shoot you some Bitcoin that would be appreciated? [21:21]

SS: Man, it sure would. (Laughter) Plus, if they do I’ll give them a tour of the capital and a private dinner. I can’t promise that but... [21:28]

JM: Well we’ll try to get the Bitcoin community out in your district and show up full force. [21:32]

SS: I’m running for US Senate and I’m taking a long shot. I had to quit the House which... I had 80% Republican district and could have stayed there until I was 90 but I’m really concerned about America’s freedom. The reason I ran for Senate is because... Ted Cruz, is the other US Senator and the current Senator that’s in Office right now is not necessarily a Libertarian free thinker. I have a belief that I think better our nation be free individually than to vote people in that want to create more people to oversee them. I still cannot get around my mind saying – Hey, I want this person to rule my life. I’m the opposite. I want less people involved in my life, not more. [22:15]

JM: Right. [22:16]

SS: By the way, thank you for having me and you have, by the way... you can’t see this because it’s by radio or podcast, he has a Bitcoin sweater on that’s bright orange and he is the hit of the party. [22:29]

JM: Oh, it’s the ‘Bitcoin, not bombs’ sweatshirt. I suggest you all get it because for every one you purchase, they give one to a homeless person. Alright, well thank you so much. It was such a pleasure. [22:37]

SS: Alright, thanks. [22:39]

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Stephanie Murphy interview with Connie Gallippi

SM: Today, I’m very excited to be talking with Connie Gallippi. She is the founder and the Executive Director of the BitGive Foundation. Connie, welcome to Let’s Talk Bitcoin. [24:20]

CG: Hi. Thank you very much. [24:21]

SM: Yeah, I’m so glad to be able to catch up with you now because we keep missing each other at conferences. I met you over six months ago in San Jose for the first time at a Bitcoin conference. We kind of kept missing each other like trains passing in the night so...

(laughter) I’m glad we have a chance to catch up now. What is the BitGive Foundation, first of all, for somebody who has never heard of it before? [24:43]

CG: Well, we are new so probably a lot of folks haven’t heard of us before. We’re a non-profit foundation so very different than, I think, most of the entities in the Bitcoin space right now. We’re doing charitable work. There are some charities, of course, involved in Bitcoin but we’ve established ourselves as more of a Foundation than sort of like a meta-charity, in the sense that we are taking in Bitcoin donations from the community and then giving to charitable causes on behalf of the community; in vetting those charities and looking at things on a global scale. The concept is a lot like, say, a Packard Foundation, or something of that nature, although it’s not a family foundation by any means - to be giving back from the community over the long term. [25:30]

SM: Sort of a meta-charity. Did you come up with the idea for it or did someone else? Tell me about how it was founded? [25:37]

CG: That’s a great question. You made reference to how we had first met in San Jose. We were at the Bitcoin Foundation’s conference there. I had, actually, just attended that conference because my brother is involved in Bitcoin pretty heavily and he lives on the East Coast and I live in California. It was an opportunity for me to be able to see him and to learn more about what he was up to and Bitcoin. I really had no intentions of being directly involved but when I was at that conference, I really was impressed by not only what I saw to be a very promising future in Bitcoin because I had already seen that and knew that with my brother’s involvement but personally being there with all those folks collected, there were a lot of brilliant people there, a lot of energy, a lot of entrepreneurial spirit and quite a bunch of investors wandering around. To me, that was a very, very key indication that this could be huge and it really became much more clear to me that the potential was at a scale of dotcom boom, or bigger even. My background is in non-profit work for environmental groups in California. I’ve been doing this for a long time and one of my focuses is helping them find funding; create funding sources at the State level; find grants, and those sorts of things. I really saw that if Bitcoin was going to be as big as I thought it could be that there was a lot of funding that would probably be made by the companies involved and the investors. If we could just get a slice of it and direct it towards charitable causes that that could really make a huge difference, I mean, on a global scale. There are so many challenges that we’re facing and I really think that the success of Bitcoin can help address those issues. That was the concept that came out of that... just being in that space and with all that energy. I started to talk to folks about it and they were really excited and I felt like it was something I should pursue. I still work full time in my career in the environmental field but I decided to start the Foundation on the side and have been doing that, as well. [28:08]

SM: That’s a really inspiring story. It sounds like you go into this conference with no intentions of really making Bitcoin a big part of your life. You just said – Hey, I’ll say hi to my brother and see what this is all about and then it spawned this whole thing that turned into a second job for you, basically. [28:23]

CG: Exactly. (Laughter) [28:24]

SM: Yeah. [28:25]

CG: That’s exactly right. [28:26]

SM: Wow. What stage are you at with the BitGive Foundation? Are you building up charities that you want to support? Are you building up funds? Where is it at right now? [28:25]

CG: Well, we’re doing all of those things. We officially launched the organization at the end of July and essentially, prior to that were very focused on just getting all the paperwork, and such, done to enable to launch. We are awaiting our status as an Exempt C3 with the IRS and that’s been a lot of the work we’ve been doing as well. Now, we are really starting to ramp up as far as fundraising, marketing, just getting ourselves out there, getting folks to know who we are and what we’re doing. Also researching the charitable groups around the world that we’d like to be giving to and establishing criteria but we want to really establish a process by which we can make those decisions about where the funding may go. A lot of that work is underway. As I mentioned, I am kind of doing this on the side and I’m working, as well, full time so it’s a lot of work but we’re chipping away at it all. [29:34]

SM: Do you need help? Are you looking for people to volunteer and help out? [29:38]

CG: Absolutely. (Laughter) [29:40]

SM: OK, so how could they do that? [29:41]

CG: Well, they could just get a hold of me at info@BitGiveFoundation.org. Also, just check out our website and the like. Yeah, we’re looking for volunteers in pretty much every area. I mean, I’m looking for folks who know a lot about internet, social media, and things like that, marketing, and fundraising. We do have some legal services that are being provided pro bono, which is really awesome by Perkins Coie but we have additional needs in that area as well. I’m open to anybody who wants to be involved and has a skill set that might match what our needs are. [30:21]

SM: I’m wondering if part of the mission, maybe, is to not just use Bitcoin as a force for good and to support charitable causes but also, maybe, to show that Bitcoin is used for charitable purposes. There’s kind of a stereotype out there which, me personally, I’ve been interested in Bitcoin charitable activities for quite a while and I know that there was this survey that was done by Zero Hedge, more than a year ago at this point, but that survey showed that the most common use for bitcoins among their respondents was actually as gifts, donations and for charitable giving. [30:58]

CG: Wow! [30:58]

SM: Bitcoin is not just to buy drugs on the internet, obviously. That’s a very small portion of Bitcoin users who have ever done that but yet, there’s this persistent stereotype that Bitcoin is all about these bad kind of uses. Is part of BitGive also showing that Bitcoin can be used for things like charity? [31:19]

CG: Absolutely. Absolutely and promoting that. It’s very important, I think, for the Bitcoin community to be more well-rounded. It’s young and there’s so much to be done but there’s a lot of focus on the technical and business and investment aspects of it which makes sense for as young as it is, but there are so many other things that Bitcoin can do. Sometimes, when I think about it, I really think that we could essentially recreate the whole world that we live in, via Bitcoin, which is kind of like endless possibilities. Working with charities and trying to do good with it is just one of many, many things, I think, we all should be thinking about. To me, it’s close to me and my heart and my passions. Like I was saying earlier, I just think the potential is so huge that there really should be a portion of what may come out of all this should be directed to the problems that we’re facing. I mean, there’s a real opportunity here to move the needle on major issues that we’re facing, if we can have a significant amount of funding that’s available on a global scale. [32:35]

SM: Yeah, definitely. One of the things that I’ve noticed being in the Bitcoin community is there is this wonderful culture of generosity because when you can send payments anywhere in the world with no friction, suddenly I think people become more inclined to do so. Have you found that that’s true too? [32:52]

CG: I do think people find it really intriguing and interesting and exciting. I think with BitGive, you know, we’re fairly young and just getting started and very early in our fundraising days so I haven’t really experienced a whole lot of that sort of energy specifically for us but... [33:12]

SM: What about you? I mean, you’ve worked in the non-profit world as well as now starting this project in the Bitcoin non-profit world. Do people hesitate to donate to charities, I guess, is what I’m asking because of the friction associated with doing so? Is that an obstacle to charitable donations in the dollar world? [33:32]

CG: I think it definitely is in some circumstances, for sure. When there are political issues, or people are in a position of authority, or a figurehead of some sort and they don’t want it to be publicly known that they are giving to a cause of some sort that may mean something very personal to them. I actually was talking to someone today about this and they said, it was just an example, but they said – If I want to donate to Planned Parenthood, I may not want my church to know about it. That’s kind of an interesting example. Yeah, I think that’s definitely the case in some situations for sure. [34:13]

SM: There are a lot of questions I have for you but just as a follow up on that, I know that one of the requirements for the IRS 501 C3 recognition of non-profit status is disclosure of the names of donors, especially large donors. I think there’s probably some threshold for what they have to report but how would that be managed with Bitcoin? Is it possible to comply with that? [34:39]

CG: (Laughter) Yeah, well that’s a really good question. I’m not sure that anyone has the answers yet which, in a sense, is good because we can turn forward in almost a fashion of well, we’ll wait and see. It’s also very hard to know how we’re going to be able to operate in the long term in that large scale donation level. We have attorneys that we’re working with

but I’m not sure that they even know... everyone’s new to the Bitcoin... how it applies to existing regulation. We may hear from the IRS. We have our application into them. We didn’t hide the fact that we’re working in Bitcoin. We may hear from them as far as what kinds of things they’d like to see. It’s a really good question. I don’t know. [35:27]

SM: Yeah. I guess those kind of things are going to have to be figured out as we go along but I have some experience pursuing non-profit status with an organization that I work with, FreeAid, and that was something that we were really concerned about because, obviously, if you put a Bitcoin address out there, someone could send you bitcoin and not own up to it, right? In some cases, why would they want to especially if it’s, for instance, if they want their privacy, right? For political reasons, they don’t want people to know they support a certain cause or charity. How would we ever find their information to be able to disclose it publicly? [36:02]

CG: Right, right. I’ve talked a little bit about our attorneys with this, in the sense that, in the dollar world of charitable donations, and also in kind donations, they can be done anonymously. Maybe we just apply the existing rules and we look at that threshold of what the dollar amount is. I think our plan, our mission is to be giving to environmental and public health causes so I don’t know as long as we’re giving to very stand-up, well-known organizations around the world who have all of their paperwork in order, that I’m not sure that it will matter, you know. [36:43]

SM: Right. Well, Planned Parenthood is still well-known but some people don’t want their church, as you said, or whatever, to know that they donated to Planned Parenthood. [36:54]

CG: Right. [36:55]

SM: That issue’s going to be there. One other thing about charities is that the blockchain is a public ledger of all the Bitcoin transactions and that presents a tremendous opportunity for transparency and auditing of charities. Are you planning to leverage the blockchain in any way, to let your donors and potential donors know – Hey look, this is where we stand in terms of our accounting and so forth? [37:16]

CG: I think we do plan on doing that. Right now, we are set up with BitPay so everything is going through them because they process everything for free for charities. [37:29]

SM: Oh, so you’re not actually holding bitcoins? It’s going to be converted to dollars? [37:33]

CG: Well, no. Not necessarily. It depends. Like when we did a recent charity drive and we did convert to the currency of their choice to donate to them but we do have holdings in Bitcoin, as well. They’re actually with BitPay, as well. They don’t typically do that kind of service but they are working on like a cold storage service that they will probably be rolling out. They are holding ours in the meantime in a high security for us. As far as the transparency; we don’t have anything to hide. We don’t have it all set up quite yet to do anything of that nature, in the sense that it’s all kind of going through BitPay. We have one

wallet address and everything is going into that one wallet address. I’m sure that can all be seen on the blockchain. Once we start having multiple projects, and different campaigns, and a variety of charities that we’re working with, and the Bitcoin donations are coming in, it’ll probably be more complex and I don’t see any reason why we wouldn’t share that kind of information. I just don’t know, right now, how we will be going about doing that. [38:47]

SM: There is the potential because you can attach tax to Bitcoin transactions so, potentially, if there’s one address that’s serving as this main incoming address for donations, when coin goes out of that address, you could say, attach a little note to it that says – This is to fund Philippines Relief efforts, or whatever. This is going to the Red Cross, or whatever. There is the potential for that, I suppose. Anyone could look at your Bitcoin address right now that you have, that you’re taking donations to and see – OK, well this address has had this many coins go into it and this is when they came in. Really, that potential for auditing, I guess, is already there. At least people can have an idea of the sort of the balance that’s in that address. [39:29]

CG: Absolutely. I’m still new to all these technical aspects of Bitcoin so I have some things to learn but we certainly don’t have anything to hide. Everything is up on the blockchain for the wallet we have, where you may see that we’ve pushed coins out into cash. Those have gone to either our bank account for bills or to the Save the Children group, which is our first campaign that we’ve done. I may be able to retroactively, I don’t know, go in and signal those things on the blockchain. I really don’t know. [40:00]

SM: Yeah, I’m not sure how to do that. I think you have to do it at the time of the transaction but it might be something for future reference to look into. [40:07]

CG: Yeah, absolutely. [40:10]

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SM: Volatility is an issue, obviously, if you’re talking about a charity that has Bitcoin holdings, there is the potential for somebody to donate Bitcoin to the charity and then some time passes and the Bitcoin is worth a different amount, or has a different amount of purchasing power than it had when it was initially donated. This could work in both ways - like the assets could grow so there’s sort an incentive for the charity, maybe, to save and to really think about how they spend their Bitcoin, or not. Or Bitcoin could crash and then those donations could shrink. How do you see BitGive, I guess, dealing with that volatility factor? It sounds like you’re splitting the holdings between Bitcoin and other currency currently but is that the long term strategy to mitigate the volatility? [42:05]

CG: That’s a really good question. A lot of these things we’re still trying to find out and figure out a long term strategy and how we will address these things. In the short term, we are holding the donations we’ve received and they have gone up significantly and even with the latest dip, they’re still seven times over what they were when we received them. [42:28]

SM: Right, yeah. That’s pretty good. (Laughter) [42:30]

CG: Right, which is great. Until we have a process established for how to decide where these funds go, we do plan to sit on those until we have a process established or some project comes along that makes a lot of sense. It’s a really good question and I think there are a lot of things we’ve been talking about at the board level about – Do we set a threshold below which we don’t cash them out? Or, do we do first coins in or first coins out? It’s a very, very good question and I think there’s a lot of ways we could handle it and we really haven’t identified exactly how we will proceed. It’s just very complicated. For one example though, we did do the Save the Children drive for Bitcoin Black Friday and that was really straight forward because it was one day and we said, everything we get this day is going to them and it was for the Philippines Relief effort so the need is immediate, it’s very acute and we’re not waiting. We’re going to give them the money right away. That was very straight forward for us. [43:44]

SM: You took in Bitcoin donations and then converted it to fiat currency and then sent that to the Philippines, or did you send the bitcoins to someone in the Philippines and they converted it? How did that work? [43:55]

CG: No, what we did was we converted the funding to our US dollar currency and then donated to them through their traditional avenues but they were aware that it was coming from the Bitcoin community and that we were exchanging bitcoins to send them fiat. They are, actually, very close to probably accepting Bitcoin directly. Save the Children is an

extremely large, international, well-known charity and have a lot of questions. Their legal folks and their finance folks have a lot of T’s to cross and I’s to dot but they are, I think, going to be directly accepting Bitcoin pretty shortly, so then we could actually be able to donate to them in Bitcoin, which will be really cool. [44:46]

SM: Is part of the idea to increase acceptance of bitcoins among accepting... on existing charities? [44:53]

CG: You know, it’s not a formal part of our mission but it is something that just sort of naturally comes with the work. I think it’s fun, actually because it’s really interesting to get people more educated and knowledgeable about Bitcoin; helping them accept it in donations. There is BitPay and I think, Coinbase too and other services that process donations in Bitcoin for free for charities. It’s really easy to promote the use of it, or help educate charities about using it. It just kind of naturally comes with what we do. [45:30]

SM: I don’t see what the problem would be for a large existing charity if they were to use a payment processor like BitPay, or Coinbase where the Bitcoin could be immediately converted into fiat, and then they wouldn’t even have to have a Bitcoin address really. All they’d do is just put this little API on their website and then they get dollars but people can donate them to them using bitcoins. It’s really a low barrier to entry for them, I think. It would just be another way to accept donations. There are some charities out there who specifically deal in Bitcoin and they don’t really use payment processors or anything like that. Like, for instance, Sean’s Outpost is a really well-known example and FreeAid (the one that I work with), they just accept bitcoins directly. There is, sort of, an enthusiasm I think, among the Bitcoin community for charities that do that because they’re kind of keeping things in Bitcoin. They’re only going outside of the Bitcoin economy when they really, really have to. [46:25]

CG: Yeah. I mean, we’re very supportive of that and one of the things that I’ve been trying to do is just be a leader in the community to try to just draw more attention to the fact that charities can accept Bitcoin; can use Bitcoin and the community can be giving and donating and just kind of getting that message out there more and being a leader in the community in that sense. There’s a lot of potential so there’s a lot more to be done. I know groups like BitPay, or companies like BitPay are out there trying to bring in charities to work with them even though they do it for free, they are really proactively trying to bring in more. [47:06]

SM: One thing that’s getting easier is if you were to operate a charity in Bitcoin exclusively, meaning you accepted donations in bitcoins and then the holdings of the charity were in Bitcoin, it’s kind of cool because it’s getting easier and easier to buy things with Bitcoin. For instance, you could pay for your web hosting; you could pay for all of your website services with Bitcoin, if you’re a charity who holds Bitcoin; you could purchase medical supplies, for instance; you can now get gift cards on Gyft that you can use to shop at CVS, Target, Amazon, if you’re in the US; you could get first aid supplies; you could get food, potentially; all kinds of things that charities could do using Bitcoin to purchase items that they need to operate, basically. I’m excited to see that getting more feasible, I guess, for charities to do. [47:55]

CG: Absolutely. It’s really exciting. [47:58]

SM: I guess, with the 501 C3 application, I just wanted to return to that for a minute. I’m really curious what the IRS is going to say. For our listeners who are international, who aren’t familiar with this term 501 C3 – it’s a designation that the IRS, the US government agency that wants to tax everybody here in the US. You can get an exemption if you are a charitable organization and people can donate to the charity and deduct it from their taxes, from their taxable income. You have to ask them for it. You have to put together a letter and an application and it’s a very long process saying – This is why we’re a charity and here’s dadada to prove it. Then, they will either say yay, or nay and come back to you. They have all these requirements. They want you to be structured a certain way, in terms of the organization’s corporate structure. One of the things about non-profit recognition by the government in the US is, I believe, that the process is different for churches and religious organizations. I’ve yet to see someone start the Church of Satoshi, or the Church of Bitcoin and say – Look at us. (Laughter) We’re non-profit. We don’t have to apply for this. I’m sure that’s coming. I’m sure somebody will do that at some point. You do have to put together this whole application which really is not geared for Bitcoin organizations; it’s geared for dollars and conventional bank accounts, and things like that. Were you involved, at all, with putting together the application for this? How was it adapted to reflect that you’re a Bitcoin organization? I guess, is what I’m wondering. [49:30]

CG: That’s a good question. You have lots of great questions. (Laughter) [49:33]

SM: Thank you. This is something that I’m really interested in so I’m glad... and thank you for sharing all your experience and expertise on this. I really appreciate you talking about it. [49:42]

CG: I think we’re all blazing new trails here so, as much as we can share with each other and learn as we go the better. [49:50]

SM: Yes. [49:51]

CG: We work very closely with a law firm called Perkins Coie and they are providing us their pro bono services to get this organization established. There is a fair amount of paperwork that needs to be done there, then with this IRS process. We have a really dynamite attorney whose entire career has been helping establish foundations and non-profits in the US. She is very well experienced in that. [50:23]

SM: Does she know about Bitcoin? Is she familiar with Bitcoin? [50:27]

CG: Well, no but we have on our team from them, as well, another attorney who is familiar with Bitcoin and so, he’s providing that sort of aspect of the whole situation. They are teaming up together and putting their minds together on all of our paperwork. I think, they could probably answer the questions a lot better than I could but my impression of the process was that we really applied as much of existing rules and processes there are in place already for charities and non-profits and try to figure out how and where best to indicate the Bitcoin aspects of what we’re doing. We’ll see what they have to say when they come

back with their response to our application. It also, I think, made it really easy that we were just brand new and they asked for a lot of financials which we don’t really have a whole lot of financials because we’re brand new. I think, maybe many groups are functioning for some time and have budgets, and the like, that they can use when they apply for a C3 status, whereas, we’re applying for it out of the gate. It’s pretty simple right now. We haven’t even finished one budget (??) (Laughter) [51:48]

SM: I’m really curious to see how that goes and, I guess, just for our listeners who may not know the story. FreeAid, actually at one point (the charity that I work with) filed for recognition of 501 C3 status with the IRS and we had some issues with our application and we decided not to pursue it after a while because it wasn’t fitting in. We operate just basically, in Bitcoin and we’re a very small charity so, perhaps size is a factor there too. I’m really curious to see what they have to say when an attorney prepares the statement and stuff. (Laughter) [52:24]

CG: Yeah. Absolutely. We are too and we’re really curious to see how long it takes them to respond, as well. (Laughter) [52:31]

SM: Yeah. It can be a long process for sure, in my experience so keep us posted on that. One last question for your Connie. I hate to do this if you’re not comfortable talking about it, just say so and we don’t have to put this in. I’m just curious what your experiences are. I remember meeting you for the first time and we looked at each other from across the room and we were like – Oh my god, it’s another woman at the Bitcoin conference. (Laughter) You know, I’m sure you’ve noticed that the Bitcoin community is pretty skewed male, right? Not that there’s anything wrong with that. That’s just where we’re at right now, as a community and we love the guys that are involved in Bitcoin but the fact remains that there just aren’t as many women. What have your experiences been as a woman who is interested in Bitcoin? Do you have anything you want to share that’s related to that? [53:24]

CG: Well, sure. It’s funny that you mentioned that when we first met because I really was overwhelmed by the fact that I was at this large conference and it was 98% male. There were very few women and when I saw you, it was like an oasis. I’m like – Oh my god, there’s another woman. That was just in May and I’ve seen a change, you know, even since then. It’s still maybe now, 96% male so it’s still quite heavily weighted in that direction. It’s understandable. It’s a programing world; it’s a finance world and traditionally those are male focused career paths, if you will, but there’s a lot of women in those fields. I would love to see them step up and be more involved in the Bitcoin community. There’s also a lot of other aspects of Bitcoin that I think, women can come in and provide a more well-rounded community. People are starting to call the Bitcoin space as now the Bitcoin ecosystem. I think, that’s a much more realistic explanation of how a community really needs to be working, and it opens up a lot of opportunity for different things to be happening, like charitable giving and more women in the space. There’s a whole lot of opportunity. I think, I have met quite a few amazing women who are in the Bitcoin space, or the Bitcoin ecosystem and they’re really passionate about what they’re doing and they want to see more women involved, as well. There is actually a group called Women in Bitcoin and that is new and just getting started but it’s a girl from Tradehill, as well as BitPay, who co-

founded it. They are on Facebook and Twitter and they’re trying to really pull together a community. They are not being exclusive to just women, as far as being involved in the group. [55:27]

SM: Yeah, it’s not like a secret club. It’s just – Hey, we’re here and we are in the Bitcoin community so come join us. (Laughter) [55:35]

CG: Exactly. Exactly. Just promoting that and getting the word out a little more that... promoting more women in Bitcoin and we welcome men to be involved in that, as well. [55:45]

SM: Working in the non-profits space outside of Bitcoin in the conventional economy, what is the gender balance like there? I’m kind of picturing, for some reason, that it’s more female dominated but I could be wrong about that. [56:01]

CG: It is actually. It’s pretty female dominated in the non-profit world and especially in the environmental world. Yeah, it’s almost like I have two completely different but yet, yin and yang related careers going on here. (Laughter) [56:18]

SM: Right. Yeah, it must be really interesting to see. You cross over from the dollar world to the Bitcoin world and then suddenly there’s a very noticeable gender difference between those two. (Laughter) [56:30]

CG: Exactly. [56:30]

SM: Two places. [56:31]

CG: Absolutely. [56:32]

SM: Have you, personally, introduced anybody in your life to Bitcoin that maybe, are not people who are working with you on BitGive but just randomly, people, friends. Yeah, tell me about that. [56:44]

CG: Absolutely, yes. Well, a lot of people think that... they see it on my Facebook. I’m always posting things on Facebook. I’m talking about it and so they have a lot of questions and those kinds of things. I just talked to someone at a party last night about all this and people are fascinated. I also helped a girlfriend of mine actually buy some bitcoins and sell her bitcoins and they went up in value. That was a really fun experience. A lot of this is new for me too. I’m not a Bitcoin expert, by any means. It’s been really fun and exciting and interesting to just keep up with what’s going on in the media. It’s a lot of what my friends and family ask about, as well. [57:27]

SM: You know, actually, tell me about what’s going to go on for BitGive in the New Year, maybe. Are you planning any campaigns or are you going to kind of maybe respond to the need in terms of, if there are any natural disasters that happen? What’s the plan for BitGive in the next couple of months? [57:44]

CG: That’s a good question. Well, right now, we’re in a process of evaluating our resources and we’re pursuing quite a bit of opportunities. My first focus is going to be on looking at capacity building funding. As I mentioned earlier, I’m just kind of working on this on the side as a volunteer and our resources are pretty limited. That’s my first priority is to start looking for funding that can help us really get off the ground and make sure we have the resources we need to really get going and make things happen. In addition to that, of course, we’re always looking for funding for the charitable causes that we’d like to give to. That’s really important, as well. We have a board meeting early in the New Year and one of the things we’ll be talking about is, what I would like to propose to the board is that we set up a two pronged process and more structure, if you will, for giving. One is that we have this short term projects like, if there is a natural disaster relief fund (we hope there isn’t) but, of course, those things do happen, that we can be poised to do things like that as well as doing quarterly drives for chosen charities. Each quarter we may choose one environmental and one public health campaign to run and they would just be running all quarter. We would switch them on a quarterly basis. On the long term side, is really where the big vision and bold stuff comes in. We want to build a multi-million dollar, almost like an endowment, but we’re not officially going to be operating as an endowment because it’s very limited when you do that. You have to only give to the charitable causes and operate off of the gains. The bulk of the funding has to sit and not be touched. We would have to have (I forget now what the calculations I had), but they were in the $10 to multi-$10s of millions of dollars in order for us to be able to even donate, if at all. [59:51]

SM: Which might not be impossible with Bitcoin. [59:53]

CG: Right. (Laughter) [59:54]

SM: Just holding on. [59:55]

CG: It would be really cool if we could actually be a real true endowment, in that we were able to raise the amount of money and the value is going up so much that we can actually operate in that way. I think, feasibility wise, for now, we’re just following that as a model, in the sense of we’d like to be bringing in long term donations that we do sit on and that do go up in value and we also give off of those gains, but not being constrained by the legal requirements of only being able to operate and provide giving on those gains. Essentially, we are looking at doing short term projects so that we’re actively giving and over the long term collecting funds that would go into this endowment pool, if you will, that we would also give off from that source, as well, but in a much more long term sustainable fashion. [1:00:58]

SM: Right. I could almost envision almost a drive where maybe the board selects a couple of charities that people could support and then they vote with their bitcoins by sending to a certain address of like – Which one do you want the donations to go to and then everybody wins and it’s kind of like a fun gamified thing. [1:01:15]

CG: That sounds fun. I like that they vote with bitcoins. That’s awesome! Yeah, that’s a cool idea. It’s been fun talking to folks about this because it is a new idea in the ecosystem and people have all kinds of neat ideas like that. I’m just collecting them and seeing what

kinds of things we can do and bringing different opportunities to the board, as well. It’s exciting. [1:01:38]

SM: Yeah, absolutely. OK, so anything else you want to add before we wrap it up? [1:01:43]

CG: I think that we’ve covered a lot. I mean I really appreciate the time and just would love folks to check us out if they have a few moments. We have a website www.BitGiveFoundation.org and we’d love for you to check us out and we update that pretty regularly, as far as what kinds of things we’re doing. We’re also on Facebook and Twitter, so you can follow us on a more active basis and see what we’re doing. We’d love donations, as well and that’s real easy to do on our website. As I mentioned earlier too, we’re looking for help, volunteers. If you’re interested in being on our board, it’s a new organization so there’s lots of opportunity. Anybody who’s interested, I encourage you to get a hold of me and we can talk. [1:02:26]

SM: You can reach Connie at info@BitGiveFoundation.org. Is that right? [1:02:31]

CG: Yes. That’s correct. [1:02:32]

SM: Connie Gallippi, thank you so much for chatting with me today. I really appreciate it. [1:02:36]

CG: Thank you Stephanie. It’s been a pleasure. [1:02:39]

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CREDITS:

BitGive was recorded and produced by Stephanie Murphy, edited by Denise Levine and featured Stephanie Murphy and Connie Gallippi

‘The Congressman’ was recorded and produced by Jonathan Mohan, edited by Adam B. Levine and featured Jonathan Mohan and Congressman Steve Stockman

Music was provided for this episode by Jared Rubens, Calvin Henderson and Matthew Murkowski

Questions or comments? Email adam@letstalkbitcoin.com

Have a good one! [1:03:05]