LETS TALK BITCOIN

Episode 81 Bitcoin for the People

Participants:

Adam B. Levine (AL) - Host
Stephanie Murphy (SM) Co-host
Michael Paycher (MP) President of SoftTouch POS Systems
Xavier Hawk (XH) Founder of Colony Earth


The following program is intended for informational purposes only. Its not investment
advice and the opinions expressed are the opinions of the individuals expressing them. Its
the Wild West out there. Do your research before putting money on the line.

Today is February 4
th
2014. Welcome to Episode 81 of Lets Talk Bitcoin, a twice weekly
show about the ideas, people and projects building the digital economy and the future of
money. My name is Adam B. Levine and Im the editor-in-chief at the LTB network and
todays episode is about how Bitcoin and cryptocurrency are different things to different
people. Ive often noted that cryptocurrency, permaculture and 3D printing have a
tremendous amount of overlap in their adherence because they are all systemic approaches
to big problems money, agriculture and manufacturing, respectively.

Im not alone in this thought and Xavier Hawk recently spoke about his take on
cryptocurrency, how he came to it and where hes taking it for the betterment of his
project, Colony Earth
Then, Ive had a secret for a while. Its called LTBcoin and Ill explain what I mean at
the end of todays episode
First, Stephanie Murphy caught up with Michael Paycher to talk about the latest
point of sale systems for Bitcoin and how their technology can free servers from the
need to handle money at all

Enjoy the show! [1:16]


______________________________________________


Stephanie Murphy interview with Michael Paycher

SM: Hi, this is Stephanie Murphy for Lets Talk Bitcoin. Im here today and Im talking with
Michael Paycher from SoftTouch. Hi Michael, welcome to the show. [1:29]

MP: Hi and thank you. [1:31]

SM: SoftTouch is a company that makes point of sale systems and recently I heard about
you in the news because you are making a product that integrates Bitcoin payments, is that
right? [1:42]

MP: Yes, thats correct. Weve taken our flagship point of sale product and we have
integrated Bitcoin payment processing into it. [1:50]

SM: Your flagship product and that would be used in restaurants and other types of stores
where people are buying physical goods? [1:58]

MP: Were primarily focused on the restaurant industry. We have our point of sale system
and is used in several capacities. One of them is by the wait staff, of course, after the
orders, to do order entry for the customers. Another approach is, of course, diners where
the customer would approach the cashier directly. In either case, we have created a
solution that allows them to use Bitcoin as a form of payment. [2:25]

SM: How would that work if a customer goes to a restaurant, lets say, theyre using
SoftTouch POS systems, the customer wants to pay with Bitcoin, how would they go about
doing that? [2:34]

MP: In a traditional eatery setting, youre sitting at the table and you eat your meal and, at
some point, you say Im done and you can ask for a guest check. There are several
different work flows but probably the simplest is you get your guest check and theres a QR
code right there on the check. You can use your phone to scan the QR code and that
immediately brings you up to our proprietary Bitcoin payment screen. [3:00]

SM: Thats sounds really easy. The restaurant wouldnt have to have a dedicated tablet or
something that they bring over to the table. They could actually print a paper receipt and it
would have a QR code, where the customer could then pay the invoice with Bitcoin? [3:14]

MP: Thats correct. That QR code right now were integrated with BitPay as Bitpayment
gateway and what weve done is weve created a solution that allows that QR code to
request an invoice from BitPay which then they can take (??) using their own Bitcoin wallet
on their mobile device. [3:33]

SM: How long has this been out, first of all? [3:36]

MP: Weve released this two or three months ago. Weve been marketing it since then.
[3:40]

SM: How has the adoption been? Have you had a lot of interest in restaurants wanting to
use the system? [3:45]

MP: Weve had some interest. The majority of interest has actually been on the patron
side. Weve got a lot of people saying Wow! Where is your restaurant? We want to go
and eat there because we want to pay in Bitcoin. On the industry side, we havent seen as
much interest and we expected as much. The restaurant industry is typically slow to adopt
new concepts and new technology. We believe that its inevitable most retailers and
restaurants are going to accept this at some point so we decided to be a leader and not a
follower. [4:19]

SM: Thats really interesting that the demand seems to be driven by the customers. Now
youre the President of SoftTouch. Was this your idea? [4:26]

MP: About a year ago or a little bit more, I started to become a Bitcoin enthusiast. I
thought the whole concept was fascinating and did some trading myself. I had read an
article about some retailers and some restaurants accepting Bitcoin and it seemed to be
more than just a novelty. They were having some legitimate business with it. Thats when
we were connected with BitPay and decided to go ahead and create that solution; that
integrated solution. [4:55]

SM: Before you thought of this, had you ever tried to go to a restaurant, or somewhere
where there was... like a physical store and pay for something with Bitcoin yourself? [5:03]

MP: No, not personally. I hadnt thought of it so much in that capacity. I was more in the
trading side and the whole cryptocurrency was just very fascinating to me but yeah, once I
read about it, it dawned on me that you could really use this in a more traditional setting
and at that point, we decided Hey, lets just go ahead and integrate this. *5:25+

SM: Had you ever bought anything online with Bitcoin purchased an item? [5:28]

MP: That I can recall, I hadnt used it for purchasing at that time. Id just done some
novelty purchases but Im waiting for Amazon to accept it. (Laughter) *5:38+

SM: (Laughter) Right. The reason I ask is because Ive had some experience with
purchasing things with Bitcoin, both going to a restaurant and trying to pay the bill with
Bitcoin and purchasing physical items, or even donating to a charity in person by scanning a
QR code on their tip jar that they had. Except for that last scenario, all of them were kind of
cumbersome. Oh, and also buying things online. It can be a little bit cumbersome when you
go to a restaurant. One of the issues that I came up against was how familiar the staff of the
restaurant was, or the store, with Bitcoin. I remember going to a restaurant once where I
wanted to pay the bill with Bitcoin and I went there specifically because they were using
Bitcoin at that restaurant. The food was great and then the bill came and it was time to
finish dinner. I asked the waitress Hey, can I pay for this in Bitcoin and she said Er, Ive
never done that before, let me go check on that. (Laughter) [6:34]

MP: It becomes a research project at that point. [6:36]

SM: Staff training can be an issue. Does SoftTouch offer any kind of training or something
that might ease the restaurants fears about training their staff to do Bitcoin payments?
[6:47]

MP: We have gone to great lengths to simplify that payment process. Depending on the
workflow, it varies slightly so, the workflow that I outlined earlier that described the
conventional setting. Once they receive the guest check, all the instructions are right there.
If the person is knowledgeable of Bitcoin and already has a Bitcoin wallet, its simple. The
wait staff isnt even involved at that point. It says right on the receipt you can pay with
Bitcoin, scan this code and everything happens right there on their personal device. It
doesnt involve the wait staff. Weve gone one step further weve even integrated it into a
product that we call QuickPay Dineglass QuickPay. What this product allows is the
patron to do is pay their bill before they even receive a guest check so there is a little
placard on the table that says Heres your table code, go to QuickPay.Dineglass.com, enter
this code and now, on their personal device, they can see their guest check electronically.
They dont even have to engage the wait staff. At that point, they are presented with
options that says You can pay with credit card, you can pay with Bitcoin. If they want to
pay with Bitcoin, its right there. Very, very simple and weve done a lot of use-case testing
to make sure that we didnt create any obstacles or burden for the restaurant with respect
to the payment process. Another workflow is the fast-food setting or quick service where
you pay before you get your food and again, weve done the same thing. If the person
wants to pay with Bitcoin right there at the cashier, theyll actually print out the receipt at
that point, hand it to them with the QR code, they can pay and that payment will be
remitted immediately and the cashier will get a notification, so shes actually looking at her
screen when the customer says I want to pay with BitPay. Weve provided all the
instructions interactively right onto her screen so she doesnt need to call the manager if
shes never done it before. Its going to tell her exactly what to do. Its an interactive
tutorial as well as the payment process itself thats embedded into the system. [8:54]

SM: This sounds really great. One thing I wanted to mention quick before I ask you the next
question I had in mind was, I know that there are also some people who might be
concerned about this doesnt happen too often but there have been some cases in the
past where there have been restaurants where the wait staff will steal credit card numbers
and stuff like that and so, giving your credit card to somebody that you dont know might be
something that people dont want to do. With Bitcoin, you dont have to give up any
personal information. You can just pay the invoice right there. Thats a cool feature I think
that could cut down on credit card theft. [9:27]

MP: Absolutely. [9:28]

SM: Is there ever an issue with somebody sending a Bitcoin payment, for instance, and then
leaving before the payment gets the first confirmation and perhaps they lost internet, or
they didnt add a transaction fee? The Bitcoin payment never gets confirmed on the Bitcoin
network but the invoice is marked paid because they did attempt to send that payment. Is
that ever an issue or can that not happen? [9:50]

MP: I dont believe that that can happen. What we do is we receive confirmation through
BitPay and, at that point, they are basically saying that this transaction is permitted and its
going to take place even if the blockchain hasnt provided all the confirmations necessary.
What will typically happen is, once the person pays against that invoice, we will monitor for
that confirmation. The cashier will be well aware of that because shes watching the screen
that says We are waiting for confirmation. As soon as she gets it, shell know that the
payment was received. In the other setting, where the person is paying by phone without
engaging any of the wait staff and payment by mobile device, its going to be a similar
process. It will actually sit there and show them that their payment is processing and it
wont take them to their final receipt until that payment is confirmed. Its a really unlikely
scenario, if even at all possible. [10:55]

SM: What if somebody Im just trying to picture everything that could possibly go wrong
and actually a lot of these have happened to me at some point what if somebody makes
an error when theyre paying and sends the wrong amount of Bitcoin to the invoice. This
actually happened to me too, by the way. I was buying a cup of soda, I think, at a store and I
was paying with Bitcoin and it was, I believe, 0.002 bitcoins, or something like that. I
screwed up and I sent 0.02, I sent ten times too much. The cashier had to manually send me
0.018 back. If somebody is using one of your systems, does the cashier have the ability to
refund a payment thats too big or if somebody makes a mistake - can they somehow get
refunded with their Bitcoin? [11:41]

MP: Yeah, they can actually go through the BitPay management console and do the refund.
At this time, we dont support the refunds through the POS system, we redirect them to
BitPay to do that. Again, its very unlikely because of the invoicing system that we use.
Theres a button that says Open Bitcoin wallet and as soon as they click that, we pre-
populate the payment amount based on the gratuity that theyve included or added and the
check amount. Its pre-populated the exact amount that theyve already declared that they
want to pay. They should never ever change that number because it already matches the
invoice amount. Again, were trying to reduce the opportunity for those kinds of errors to
occur. Yes, if somebody for some reason decided to change the amount and then caught on
to it later, they could certainly get a refund through BitPay, through the payment gateway.
[12:32]

SM: One last question what if a server at a restaurant wanted to keep their tips that they
received in Bitcoin, could they do that or does it depend on, since the restaurant is probably
converting the Bitcoin to cash and not keeping it in BitPay, could a server decide to do that
on their own? [12:49]

MP: At this level of integration, youre right, most of it is being converted back to cash or,
even if the restaurant operator elects to keep everything as native Bitcoin on the BitPay
gateway side, what will happen is when that server wants to be paid, at the end of the night,
our system will automatically calculate their tips in cash amount in US dollars. At this point,
weve not approached that use-case or come up with a solution for that. Wed like to see
some adoption across the restaurant industry and then, perhaps, delve into that. One of
the things we were talking about earlier, with respect to the security side of paying with
Bitcoin, you were absolutely on point with not having to surrender a credit card and, of
course, one of the other great opportunities or advantages for the restaurant operators is
the lower cost of transaction fees that they would pay on those Bitcoin transactions for
credit card transactions. Its an important point, I think, that the operators need to
understand that as the popularity of this increases that they stand to make more money by
using it. [14:05]

SM: Michael, thank you so much for your time. Michael Paycher hes the President of
SoftTouch POS Systems and you can visit their website at www.SoftTouchPOS.com. On the
front page, youre going to see a big slider that says We have Bitcoin integration and I think
thats great. Michael, thank you so much for taking the time to talk with me today. [14:23]

MP: Thank you so much for having me. [14:25]


______________________________________________


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th
2014. Nxts arbitrary messages feature allows data in any
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next Lets Talk Bitcoin broadcast. *15:25+


______________________________________________


Hello everybody. My name is Xavier Hawk. Im the founder of Colony Earth, a small eco-
development right outside of Asheville, North Carolina. Im going to be talking a little bit
about permaculture; Im going to be talking about the permaculture of Bitcoin; Im going to
be talking about trends in the housing market and trends in general and what were going to
be seeing in the future and how the model that Ive come up with for developments is going
to be the way of the future. [15:52]

Permaculture in two words is permanent culture, one word, symbiosis. Does anybody here
not know what permaculture is? OK. Basically, what were doing is were mimicking the
systems in nature in order to produce food and prosperity for ourselves and for those
around us. Its the idea of using ruminants like cows and goats to plough a field, dropping
their droppings and fertilizing the field and then growing plants there. Its a way of
increasing yields with less inputs and stacking systems, kind of like vertical integration in
corporate structures. You want to have as much functionality as you can in one little space
and create a lot of abundance. In two words, permanent culture, in one word, symbiosis.
The originators are Bill Mollison and David Holmgren and then, Geoff Lawton as well, but
they all (just to give you a brief history) look back to this guy and his name is Masanobu
Fukuoka. He says that the ultimate goal of farming is not the growing of crops but the
cultivation and perfection of human beings. There is a really great thing that happens when
you start digging in the dirt. You start digging in your own spiritual dirt and you start
learning and becoming more of a true human. Mr Fukuoka looks back at these folks who
are some of my ancestors and the way they did permaculture was like this. Basically, what
they did is they looked at the systems in nature and they didnt say that these are systems
where we gained from these are our neighbors. These are our friends. This friend likes
this friend and grows better with this friend and when this friend grows in this area with this
one, it doesnt do so well and we dont get so much food. When the settlers first came to
the United States, or what is now the United States, they looked at all of these meadows
and said Theres just food growing everywhere. It didnt look like what we see as
agriculture, it was more of a symbiotic relationship between humans and their non-human
friends. [17:35]

The cool thing about permaculture... I mean this is a real overview. This is really just
touching on it. Theres the three sisters, to give you an example. Corn grows tall, its firm,
beans like to grow up trellises and squash likes the shade and it also prevents weeds from
growing. The three sisters grow well together because corn grows tall, takes nitrogen
beans fix nitrogen and grow up the corn and the squash grows on a ground layer in the
shade and prevents weeds from growing. This is an example of interdependent mutually
beneficial systems. People in permaculture are early adopters, passionate, theyre risk
takers, theyre creative, and theyre a disruptive, free-thinking, community minded and very
intelligent, a lot like us, the Bitcoin community. We have mutually interdependent
beneficial systems like Cypherpunks, miners, mining pools all of these different systems
that are coming into play to be able to support one another, to support this eco-system.
Where were at with Bitcoin is a brand awareness stage. We are trying to get more people
to find out about it and to use it. The different companies that are starting to accept Bitcoin
are catering to us but what we need to do as a community is grow the outlets for usage, not
just people who are accepting Bitcoin but give incentives for people, who dont understand
what it is, to start using it. Anybody whos in marketing will understand that you need to
target market. You cant just broad blanket and say Im going to go and do this and
everybodys going to love it. My point with the permaculture folks is that they are very
similar to us. Theres a vesica piscis thats going to happen between the two metaspheres
of Bitcoin and permaculture and other different spheres as well because theyre like minded
folks and like minded individuals. [19:15]

My solution is housing for a permaculture based lifestyle. The way wed do this is... lets just
say that we fuse 21
st
century breakneck speed tech advancements with ancient wisdom
traditions. If we, as a civilization, are going to continue on, we are going to need to
implement the wisdom and the traditions of our ancient origins to be able to match the
technological advancements that we have, or were going to be the fabled Atlantis and just
destroy ourselves with all of our technology, type thing. This is a picture of bubbles of water
on glass (laughter) and the reason why is because I have this really awesome greenhouse
that has a big rain shower in it and it was pouring snow and it was 20 degrees outside. I was
sitting in the bathtub, very comfortable at a 90 degree greenhouse and I saw these bubbles
going down the glass, these raindrops and I realized that permaculture was this big bubble
that was sitting right there and then Bitcoin was this fast moving little pssshhhzoom! that
came through. It hit the permaculture bubble. The permaculture metasphere has been
around since the 60s and 70s and Bitcoin has only been around for a few short years but its
moving faster and they both are comprised of the same components, essentially. One is
tech and one is crops. The idea of having the fusion of these metaspheres weve got
permaculture which is this slow moving bubble thats been going down and then Bitcoin
comes pssshhhzoom! And they actually just connected like this and the whole thing went a
whole lot faster than both of the two on their own. The point is is that we need to target
market our efforts. The trends of the past iBox, phones, Rolexs, are going to give way to
the trends of the future which is going to be clean food and water. There are a number of
devastating events that are going around on the planet right now that, in twenty years,
getting an orange is going to be a really unique treat lets just put it that way. What that
means is that everybody wants healthy food, the Lohas demographics, the Lohas generation
people want to have organic food, biodynamic food, clean water, no chlorine, and no
fluoride. These are going to be the traits and the status symbols of the future and its
already starting now. Weve got problems with the real estate and housing market all of
these things, failures abound and the playing field is changing. People are less concerned
with home ownership. [21:37]

I own property and I think that I own it because if I dont pay my taxes on it, somebody is
going to come by with a gun and tell me to leave it. The concept of what we think we own,
in terms of real estate and land, is completely a fallacy and whats happening now is that
there are different communities that are popping up where rather than get... what do you
own really when you own a piece of property? You own a piece of paper that says you have
the use of this land for a particular period of time, however long that is, being your life or if
you deed it to your children, or if you transfer it and sell it. You have rights to use this
property and do with it as you please. What we do is redefine ownership and we put the
property and the corporate ownership of the development and then everybody comes and
joins and becomes a member and they buy a piece of paper that says You have the rights
to use it in this way, shape and form. You can deed it, you can transfer it, you can sell it, and
whatnot. We redefine it that way. Basically, we buy, own and develop the land and we will
be putting them in skyscrapers and what we can do is we can make systems such that we
are power generation we create our own power, we waste management, take care of our
own waste management utilizing all the systems of permaculture to stack all of these things
so that theyre all creating a higher yield as it were. In each of our developments, we can
provide housing, club houses and retreat centers. Imagine a golf course that you find here
in South Florida a high end golf course, gated community where people pay to be there
and people are taking care of the golf course. You go to a club and they have a bar and all
kinds of cool activities that go on there. Now imagine, instead of a golf course, its
permaculture gardens and you have food delivered to your house every day, fresh eggs
from the chickens in the coup, fresh water and all of that. Were able to provide onsite
employment, housing, education activities and all of this for our members. Essentially, like I
said, the members buy a contract into our eco-village for an introductory price that would
be equivalent to a mortgage. Quite interestingly enough, when this gets to full
developmental stage where its operating and weve got a number of these membership
villages around the planet, you could buy one place in Cupertino for the price of four. The
four houses that you have one in Singapore, one in Brazil, one in the United States
(wherever it might be), theyre able to provide you with a revenue source so, while youre
not using... kind of like a timeshare. [23:57]

Essentially, what Ive been doing is Ive taken my years of... little bit of background I was a
consultant here in South Florida, hacked life, retired at thirty, moved and bought this farm
and I was like Im going to go become Zen on the mountain and Im going to grow
vegetables and trade my intellect time in hours for food rather than dollars. I was looking at
it and my mind just went on and on and I was like Theres got to be a way for this to
become profitable, and abundant, and self sufficient, and take care of itself and replicate in
scale. What I did is I came up with this whole business model based on permaculture. I was
like OK, so I put out an ad on Craigslist. Come and live in our place for $350/month plus 15
hours of labor. I put the ad out on Craigslist for one day and I had 45 people apply. I only
had room, at capacity, for 15. I said, Ive really got something here. I started looking at the
property more and the picture at the very beginning was the property... Ill see if we can go
back to it at the end but... so essentially, you buy a residential contract or a temporary
contract, work/trade contract and all sorts of things. Youre buying a lifelong transferable
corporate membership with land use clauses and what we do for folks who are doctors and
lawyers, who dont understand permaculture but like it and like the clean vegetables and
that sort of thing, they come and live there and they have an opportunity to learn how the
systems work. They can interact with the systems and they get the benefits of those
systems, whereas other folks who dont necessarily have the income levels to not work on
the field to do that sort of thing, they get to do it and teach those folks. What were doing is
creating a micro-climate eco-system of productivity and livelihood. We provide safe,
modern, secure housing walk inside with mood lighting, set with your RFID chip thats
implanted or your phone, or however the technology moves in the future. The lights turn
on to the color that you like, the music comes on and its 21
st
century, and further, modern
technology based upon wisdom traditions. Weve got cutting edge technological
advancements, safe, clean, healthy, local food thats grown in your neighborhood by people
that you know. We can do safe and affordable, onsite childcare by people who you know.
Also, education onsite, local industry and office space onsite so, for me, I go to an office that
I run my own businesses out of and its on the farm but other people would do the same.
They travel a lot, just like we do but we dont necessarily want to maintain our goats every
day. We enjoy our goats and enjoy our chickens but it takes some work to get them fed and
do all of that sort of stuff. You have to find people to take care of them while youre gone
and travelling we provide that. We provide cultural and adventure activities hiking,
mountain climbing and all kinds of cool stuff as well as global networking building
opportunities. Imagine that golf course, that I was telling you about, that has a good
clubhouse but instead of evening events, or whatever, theres international conferences like
this that take place there, right in your own neighborhood, right in your own community, or
health and wellness retreats and that sort of thing with access to untouched wilderness
areas, business incubation opportunities. One of the things that we do at our place right
now is we provide our resources and land for young folks and agriculturalists and mothers
that want to grow different vegetables, or create their own cottage industries, so we
incubate them and theres a lot of opportunities for that. Buying club discounts we could
get healthcare for everybody that lives there, that kind of thing. Essentially, Colony Earth is
a development company and it buys the resources. What we do is we have a selection
criteria for... it needs to close to a metropolitan area within so many minutes of an airport, it
needs to have clean water and that kind of thing. Also, the opportunities for lithium mining
or water production for spring water, that kind of thing. We look at the natural resources
that are on the land and what kind of businesses can be done out of that as well. [27:52]

We produce revenue in a bunch of different ways. I could go through them all but what I
want to really get to is how Bitcoin and the cryptocurrencies fit into all of this. By the way,
there are two income revenue generating streams that I have blocked out with hash tags
here. Each one of those equals, if not dwarfs all of the others combined so just check those
out while Im explaining this out. When a person comes to our membership development,
they are buying a lifestyle and what were going to do eventually... and Im thinking that
were going to end up creating our own currency for this... when we have a number of
different villages around the planet, or different developments a skyscraper in Singapore,
a rural farm community in Asheville, that kind of thing you get a membership to all of
those different ones. When you pay... lets say the mortgage or down payment on a house
would be $20,000 or whatnot, you pay your $20,000 and we give you 20,000 worth of our
cryptocurrency like ColonyEarthcoins. Like Vitalik was saying, there are going to be coins for
different purposes. The way I see the future of Bitcoin and all of these cryptocurrencies is
theres going to be huge... its going to be a bio-diverse climate of micro-climates of
different currencies like Starbuckscoins, with Targetcoins, with Solarcoins all with different
purposes powering different things. ColonyEarthcoins lets say you come and you buy
your membership initially for $20,000, we give you $20,000 worth of ColonyEarthcoins that
are usable at all of the different eco-villages around the planet. You can also take them out
on the market and sell them. What youre getting is a value proposition where you get land,
you get access to land, a home, a technologically advanced home with clean food and clean
water and then youd walk away with coins that you can actually turn around and sell and
make some money on, as well, out in the market. [29:45]

At our place, we have just a few employees, two or three, depending upon the level of buy-
in and how many people are there. A farm manager who determines what crops are going
to be grown and how much to grow so that everybody can be fed thats there and that
there can be profits made over that, as well as an activities coordinator who produces the
events that take place there that does cool stuff for the community members as well as
international folks doing retreats, and whatnot, and then also an administrator. We pay
them in Bitcoin and Litecoin and different currencies. Also, when you have a home in one of
our developments and you decide to take off for a couple of months and there is a retreat
going on in the place where youre not at, but you dont mind having somebody rent out
your spot, then youre producing income for yourself on that. How many of you have seen
these bioglow plants? They just created these plants that glow, like in the movie Avatar.
Anybody seen those? They are selling them for like $150 and whether you believe in
biogenetics and all of these other genetic modifications, they are pretty cool. (Laughter)
They are bioluminescent plants. Something like that could be a cottage industry that could
be grown. The folks who are living there that are working the land, or whatever, would be
growing these things and thats some extra added revenue for the corporation, each eco-
village corporation, each development, whom the owners in.... the people who buy the
contracts in, will get profits from it. Youre looking at a value added proposition where you
get a home, clean food, an appreciating asset in the form of your membership contract, an
appreciating asset in the form of your Bitcoins and Litecoins and all of the other altcoins and
part of something thats cutting edge of the future. This is just a modest proforma for a
small, little development and youre looking at $1.6m a year, thats with all the costs and
everything included. Weve got pictures marketing. Like I said with the Craigslist ad... you
know, when trends happen and you position yourself ahead of them, theres very little that
you need to do to... its kind of like paddling and surfboarding. I love surfing and when you
are positioned properly and a wave comes, its easy to get up on top of it. We structure
each village in a way so that its maximum use, where there are a lot of communal areas to
hang out, there are retreat centers, theres production productivity and livelihood. Were
able to employ people on site. Lets say youre not a doctor or a lawyer but youre a college
student and you dont have a lot of dough but you really want to live this way and you dont
mind working in the fields but you also dont have a job and you dont want to commute
thirty minutes to the nearest metropolitan area. Were able to provide you with jobs on site
through various partners. One of them is Arise, which is a company that does customer
service. You can be a customer service rep for Apple, for United Airlines all of these
different companies straight from your home but we provide an office and thats actually
one of the ways that we produce added value. My goal is to build one of these in Singapore
and build a skyscraper that looks something like this... and produces its own food and its
own water. A good friend of mine is the guy who owns the water cleaning device that the
White House uses. You could stick radioactive Fukushima slime mould into it and come out
with clean water out of it and we could put those in houses. There are devices that are
currently manufactured overseas that produce power. They are basically about the size of a
55 gallon drum and you could power an entire skyscraper with it clean energy, plasma
fusion is being done by folks in New Jersey right now and solar power and all of these
different ones. The technology that we have right now exists to be able to provide an
Earthship. Thats also one of the things that we do we build Earthships, which are totally
self-sustaining off-grid power generating, fuel generating, and waste management
generating homes. Its high technologically advanced stuff based upon the wisdom
traditions of permaculture and things that keep us alive. Weve got pictures of all of these
beautiful things and were talking high end skyscrapers, were talking high end living, were
talking new symbols of wealth, new status symbols of how it means to live good, green, in
balance with the Earth and how the future is going to look. [34:18]

One of the guys on my board, he can actually grow this in seven years for under $100,000.
You can grow an island now with the same process and same technology that molluscs use
to create their shell. Its called calcium excretion. You can put a big grid, a mesh grid under
water with some batteries and solar power and over the course of seven years, it will
become a living seashell thats youve designed and created in the shape that you want.
That technology exists now. Also were going to be Colony Moon when Sir Richard Branson
eventually gets Virgin Galactic to the moon and we start building colonies with technologies
that Im using and the technologies that Im incorporating will be the mining colonies of the
future. The coal towns of West Virginia back in the day this is going to be a return to that,
essentially. Facebook just decided that theyre going to open up a housing community out
in California. Has anybody heard about that? They are spending about $140m, or
something like that and theyre really wasting their money because theyre not
implementing the strategies that Ive already designed into the system. Heres the dark side
of this. A panopticon a home that you walk in where every movement that you have is
tracked, your heartbeat, and your heart rate, all of these things are tracked in the cloud and
all of that. You guys know the movie Alien, right, where they go to space and they find this
crazy being that... the way that that future is, is a fascist sort of technocratic global
technocracy run by corporations. Just with the protocols of Bitcoin and all the
cryptocurrencies, were making governments obsolete in a sense because were able to self-
determine democratically what were going to do, how were going to do it and what gets
money and what doesnt, what gets funded and what doesnt. Vitalik just made a great
point about the climate of all of these different coins existing. If you believe in medical
research and youre going to buy those coins and get value for them, the Earth will become
a self-organizing collective, democratically and were not going to have the need for these
things. Whats happening now is like weve got companies like Google and all of these
wonderful companies, the technological companies that are solving all of these problems
with math, essentially. Theres no more fight the power, its ignore the power. It is we are
the power. It is we do what we want now and we come up with situations and solutions
for things that are amicable and beautiful. The challenges and the dark side of that is that it
could be turned into a matrix, essentially. We are Colony Earth and what we like to do is we
like to make it warm and fuzzy and give people good food, clean water, a great environment
for their kids to grow in a template of how humans can live in balance with the planet
running on 21
st
century technologies of cryptocurrency but utilizing the wisdom traditions of
our past. [37:03]

Some points to consider are some of the things that I was saying was that this is very
America centric in the declining housing market. We can stick these anywhere. In fact, we
can do this easier in some other countries than we could in the United States... funny that
right? Theres a whole... how the government of this little eco-village runs, how the board
works, what levels of stock that you get when you buy at different levels, and whatnot and
you also get your own returns and profit sharing. We can do this in Detroit, we can do this
in Singapore, we can do this in Hong Kong, we can make floating islands and we can do it on
the moon. What I showed you earlier was one small village with one building here in Miami
that has 600 people. I was doing the calculations the other night before I went to bed. We
would be able to return a $40m investment in five years with a good upside a really good
one. Eventually, wed build and design an eco-village to sell to large corporations, like
Google and Facebook and also corporations that want to mine on the moon. Well be able
to sell them these models and sell them the contracts and do it. We have an appreciating
asset of the land as we control the real value there. Some of the folks that Ive talked to...
Im a really unique dude with a lot of really strange connections that Ive made in my life
and I know that there are people at the very tip top of our civilization that are saying that
this is the lifeboat of humanity these kinds of models, this decentralized communal living
and not the hippie commune thing but the permaculture based systems where food is
produced on your own spot, and all of that. Thats the future and people are going to pay
out of the nose for this kind of lifestyle. Thats it. Are there any questions? *38:39+

Audience question: I have seen many initiatives like this, including communal projects...
you borrowed a couple of pictures from this project. All of them usually end up in a similar
way actually, because of the same problems that Bitcoin is currently facing government
laws. You are assuming that territory is free and you will not have to comply or report to
anybody but governments of the majority of countries, for example, will forbid you to use
your own currency and will ask you to pay taxes. [39:15]

XH: Thats no problem. I know where youre going with this and youre right. Actually,
what he was touching on was that 99% of intentional communities fail because people dont
understand business and they go into it thinking were going to go and live communally and
were not going to have money. Were going to trade food, trade barter and this and that.
That kind of works but you need to have it make dollars to make sense. Also what you were
saying about the... my model is based upon a business structure. Its about... yes, we would
like beautiful technology and all of these things and yes, we are going to pay taxes to
whatever municipality we are in. Thats not an issue. I dont think were trying to create...
The phase that were at right now is were looking for six figure investors. In seven years, I
plan it to have this nine figure concern and I would like to get a blimp and theres a fellow by
the name of Igor Pasternak who is creating a ship called the Arrowscraft. Hell be ready in
2020. Im planning on having this become a powerhouse to be able to fund, essentially, the
worlds first high profile action hero team that would be using a blimp to come and rescue
people like what happened in Haiti where the roads were all blocked. If we were able to
drop a tent city... Anyway, thats where Im headed. Any other questions? [40:20]

Audience question: Thats kind of an extreme example but lets say youve got your
community and two thirds of the people want to grow bioluminescent plants and one third
of the people want to grow tomatoes. How would you deal with that? [40:30]

XH: Thats determined by the residents the people who buy in the contracts. They
determine two thirds want this, two thirds want that. Its really all... we set the guidelines
and we say this is what needs to happen, like these are the business systems that we can
see working here and you get to decide what it looks like and how it moves. Thats all
determined by the people who are living there the board members. The reason why this
works as opposed to all the other communities and whatnot is because its based on money
and when people decide that theyre going to be invested in this, theyre investing not only
their lifestyle but their time and their efforts so theyre going to see that it does well.
Theyre going to put effort into making sure that it does well because theyre paying to be
there, theyre paying to get the results of it and so theyre going to be involved in how it
goes down. Not a homeowners association but a board of directors. Any other questions?
[41:14]

Audience question: My aunt was actually in charge with a state representative in Florida.
They incorporated... it used to be called Cutler Ridge and they actually incorporated the city
and called it Cutler Bay. Instead of actually paying the taxes to the feds right away, they
kept it inside the community and then basically, completely changed the whole, entire city.
Its a good case study actually. *41:32+

XH: Really? They created their own municipality? [41:34]

Audience reply: Yeah, so its Cutler Bay, Florida. Its basically... in Miami you have these
little subsidiary cities. If you actually incorporate it, you can use the capital to change the
community. There might be a way of you doing a quasi-official now... [41:49]

XH: Yeah, no I like that. [41:51]

Audience reply: ...and using that system. It completely changed... if you looked at the
numbers of Cutler Bay and you look at what it was in 2004, before it was incorporated, (??)
we had two police officers and the crime rates were crazy and then it went to fifteen police
officers. [42:06]

XH: Ah yes, yes. I actually heard about that now that you mention that, right. [42:08]

Audience reply: It might be an interesting thing. I dont know if youve thought about going
through a quasi-... [42:11]

XH: No, I havent even thought about incorporating as a municipality but thats a really
good idea. Thats a really good idea. *42:17+

Audience question: If I understand right, your immediate demographic is affluent ex-
hippies and maybe college students that are willing to work on the commune. How are eco-
communities going to benefit the say the one straw farmer or the Iroquois that you quoted
at the beginning of your presentation? [42:36]

XH: Whats really cool about this is when we have ColonyEarthcoins and all that going
around, we can take one of these and at any level, we can do high-end skyscrapers, like I
was saying and we can renovate Detroit. We could go to the reservation in Pine Ridge and
put this in place and give them all of their systems back. This is me being like I want to
better the world. How do I do this and turning my back on all of the protesting and all of
those things and saying How do I do this so that it makes sense for people and is actually
implementable and is not just a pipedream? Thank you very much. My name is Xavier
Hawk. Ive got a booth out there Colony Earth. (Applause) [43:13]


___________________________________________


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___________________________________________


AL: Money is funny. You do all kinds of things for it and many of those things probably fall
into the category of things you wouldnt do if you werent being paid to do it and yet money
is the thing that one needs to live. Bitcoin is money, just like any other. People believe it to
be valuable because they believe it to be limited in quantity with growing numbers of
people wishing to have some. If youre holding bitcoin, thats the lower case b version of
bitcoins, the ones that are tracked in your wallet rather than the infrastructure level pipes
through which those tokens flow. If youre speculating on the price of Bitcoin going up,
really what you believe is the network will grow and that more people will therefore find the
networks tokens more valuable, which will be reflected by a higher price new users are
willing to pay for it. If youre an LTB listener, no doubt youve heard of both altcoins and
metacoins but today, were going to talk about a new kind of coin a network coin. Today, I
want to tell you about LTBcoin. [45:22]

Lets Talk Bitcoin, the show that Ive been producing since April 2013, has taken a huge
amount of my time and advanced enormously in the amount of time that weve been
around. Its been a very rewarding experience and, while I practice what I preach, tip
content and ensure funds wherever possible, the reality is that none of the people, who
have helped me build LTB to the point were at now, are owners of the parent company or
partners in the underlying anything. Creating something from nothing is difficult under any
circumstances and lacking any real financial resources, our strategy had been to do good
work, put it out for free to anyone who wants it and ask for help in the form of volunteers or
discounted services from listeners who like what we do and want to help. I believe that
using a network coin we can, from minute one, reward those who add value to the network
by paying them with a coin that is given value by the network. Im going to say that again. If
Id started Lets Talk Bitcoin and on Day one, I had access to an alternative cryptocurrency
called LTBcoin, even though LTBcoin would have been worthless, I could have paid people
with it at no cost to the project. If Lets Talk Bitcoin had failed, the currency I had been
compensating people in would have been worthless but thats no different than any other
speculative or volunteer project. If, on the other hand, the network succeeds, while the
coins could be sold as soon as theyre traded on the market, they can also be held until the
network is more valuable because LTBcoin is tradable for Bitcoin, it functions as a stake in
the LTB network effect and a currency for those who want it. Ive said that I could pay
volunteers with LTBcoin. I can explain this but first, we have to talk about mining. [47:02]

Most coins are valuable because of the network that uses them. First creating a coin and
then attempting to bring in service providers who will accept it, thus giving utility to the coin
and therefore value. Bitcoin had a bit of a chicken/egg problem. It was the first
cryptocurrency, so only a handful of people understood what it could be and yet, to achieve
redundant decentralization, it needed to be distributed to many and not just a few.
Computational mining was the solution they arrived on. It limited the people who would
get access to the early bitcoins to those who were biased towards early adopters and tech
savvy people, rather than those who generally received new money. In much the same way,
LTBcoin will not use computational mining, rather requiring a more nuanced proof of work.
Those who create the value of the network are the content creators and the audiences they
cater to. LTBcoin will be distributed both as pay to content creators and service providers
who populate the Lets Talk Bitcoin network and as valuable prizes, given to many lucky
members of the LTB audience. LTBcoin will be valuable because it will be the exclusive
token used to sponsor the LTB network. LTBcoin will also be the token that lets you become
a contestant on our game show, by gear for the best prices in our store and over time, this
list will grow. Basically, with a network coin, anything new we roll out through the network
has something awesome that you can do on it thats cheaper, better that you simply cant
do with anything else. Network coins are made valuable by the network accepting them. If
the service or good they offer in exchange is not valuable or appeals to few people, then the
token wont be valuable but in networks that truly do create value, what I think weve got
here is a virtuous cycle that can empower people to start small with LTB and, as the network
continues to find growth and success, these humble beginnings can give early contributors
and listeners the financial freedom to help out more, if they desire or to do something else
entirely. [48:47]

To recap, LTBcoin is good for everyone working on the project because their efforts make
them the miners of our system where their productive effort and the inclusion of their
content on our network is their proof of work. Someone who creates a show for the
network adds more value than someone who does announcements for a single episode and
they add more value than someone just listening. All of these actions do have value and all
of them are mining in their own way. LTBcoin is good for the audience. There will be
raffles, surveys, on-air giveaways and at least one game show giving it away en masse. It
doesnt matter how you acquired LTBcoin, you stand to gain from more people discovering
the LTB network and becoming a member of our growing community. Imagine if you could
hold some coins of your favorite unsigned artist. They get some funds up front and if they
make it big, youll be the guy who bought their equivalent of Bitcoin in 2010. Aside from the
direct benefits, the audience will also see much more and much higher quality new content
as that element of financial interest turns up the competitive heat. LTBcoin is good for
sponsors. If you believe the network will grow in the future, you can buy LTBcoin up front.
Since it is a deflationary, fixed supply cryptocurrency and sponsor slots are auctioned to the
highest bidder, if you hold onto your supply, you should be able to get more value for your
LTBcoin as time goes on. On the other hand, a sponsor just discovering the network can buy
LTBcoin at the current market rate and not pay a penalty. They just cant capture the
discount of having bought early. Another thing to note is that with this change, well be
creating a new program for individual patrons. To this point, weve accepted sponsors who
are generally forward looking individuals who run companies that have products to sell.
Moving forwards, sponsor slots will be available to individuals as well, to make personal
announcements, collaboration requests, idea pitches the field is pretty wide open. Our
restrictions remain the same as theyve always been which is, nothing illegal, nothing
dishonest, no gambling, sex or weapons. At their core, network coins are good for Bitcoin.
Bitcoin is, to a certain extent, one of a kind. Its a coin thats the most popular coin because
its the most popular coin. There can kind of only be one of those and so, the argument
goes, that any coin that copies Bitcoin that has its own money supply, is effectively deluding
the value of Bitcoin. With a network coin, thats just not the case. Bitcoins network, its
value is enhanced by things like LTBcoin and all network coins because Bitcoin is the crypto-
reserve currency. Think of Bitcoin like the dollar and LTBcoin like a first year stock. Is the
value of the dollar diminished by a stock like Google? I dont think so. *51:09+

To summarize, I think LTBcoin is a real win/win situation and will be a very popular model
for bootstrapping everything from independent record labels to hackerspaces and I
wouldnt be surprised if we saw start-up communities and incubators emerge with this
model before too long. Eventually, I see network coins replacing stock as it literally
improves on the concept of equity in, basically, every way. Were not issuing stock and I
want to be clear that LTBcoins are simply a fixed supply, proprietary token that the LTB
network voluntarily, non-contractually and publically will commit to honor for a growing list
of goods and services. While the goal and vision are clear, the best technology to build this
all on isnt necessarily clear and so we have not yet decided between building user currency
on top of a metacoin like Mastercoin or, if its simply better to just take the most advanced
forms of proof of stake systems, like that being created like BitShares and essentially, just
fork that code for our own use. The human team will doing the implementation of this for
us, whatever technology we decide on, so really its just a matter of seeing what happens
over the next couple of months. There are a lot of specifics Im not going into here and
much is still undecided. Stay tuned for future updates on the topic and if youve got a
comment about it so far, email adam@letstalkbitcoin.com with the subject LTBcoin. Thanks
for listening. [52:26]


__________________________________________


CREDITS:

Thanks for listening to Episode 81 of Lets Talk Bitcoin.

Michael Paycher was produced by Stephanie Murphy and edited by Adam B. Levine
Xavier Hawk was captured by Steve Malagodi of Spectacular Sound at the North
American Bitcoin conference in January 2014
LTBcoin was written, read and produced by Adam B. Levine
Music was provided for this episode by Jared Rubens, General Fuzz and Calvin
Henderson

Questions or comments? Email adam@letstalkbitcoin.com.

Have a good one! [52:54]