Community Call Recap - November 18th

Our latest Community Call took place on the 18th of November. Michael Bille joined Enrico Rubboli (CEO) remotely to discuss the current crypto market conditions after the crash caused by FTX and why you need self-custody of your tokens and to use non-custodial wallets instead of centralized exchanges.

If you missed the video, you can check it out below.

Read on for the full transcript of the community call.

Michael Bille: Hi, everyone, and welcome to this casual Friday talk. I’m here with Enrico today, and this call is more like a relaxed, casual call, so it’s not the normal development update call we’re going to have. So today, we’re going to focus on the markets and different topics. And also, of course, we’ll talk a little bit about Mintlayer. Enrico - welcome to the call this Friday.

Enrico Rubboli: Hi, good day.

Michael Bille: Good to see you here. I know you’re super busy, so I appreciate you taking time to this call and the community. To see what’s going on with Mintlayer. So the last two weeks have been super crazy in the crypto market.

We have this huge thing with Sam, FTX, and Alameda Research that’s unfortunately gone bankrupt. And it puts, of course, a lot of retail investors into a position where they cannot access their funds and investments. So it’s super terrible. What do you think about this, Enrico? You have been in the market for many years. What are your thoughts on this? And have you seen anything like this before?

Enrico Rubboli: I’m still trying to figure it out, but it’s probably one of the worst weeks in our industry. And there are a lot of lessons to learn.

The most important - the thing is, a lot of people lost tons of money. Many people put their savings into exchanges or even invested in projects. And it’s terrible. So a lot of people at the moment are in trouble. And when this kind of thing happens.

There are two things that someone thinks of, and one is regulation. Do we need more regulation? Do we need to prevent these things from happening again? And there are basically two schools of thought. Some think that regulation is what prevents this from happening. And the fact that it happened in the crypto world is because we don’t have surveillance. We don’t have a central bank or central authority monitoring these companies.

On the other side of the spectrum, people think we need a free market and that the market will regulate itself as people learn. However, this shouldn’t be the case entirely, either.

But one thing that we should take into consideration is the fact that Bitcoin was born as a tool for self-custody. It’s a tool for not having to trust someone else. Here with centralized exchanges, we are exactly in the opposite situation. Many people trusted the exchanges, the fund, and so on.

However, this is why the core concept of Bitcoin is not affected. Of course, prices are down at the moment. But in terms of the reason for Bitcoin, I think this is a lesson. Bitcoin pushes in another direction (Decentralization) where people are more responsible and manage their money and funds directly.

And the DeFi space itself is a place where you have self-custody. There is more contrast, of course; there are hacks and other issues. There are still people that can rug pool and scam, but at least you have the transparency of what is going on the blockchain.

Michael Bille: Yes, exactly. That’s a good thing about blockchain technology because, generally with a blockchain like Bitcoin, it is super transparent. You can audit all the things going on in the Bitcoin blockchain. So that’s true.

On the other hand, what comes to my mind is FTX and Alameda research, which are centralized entities. We see this substantial centralized entity that needs to have the assets in the bank accounts as they should. So they should have a lawyer and an accountant and ensure everything on their books is correctly stated. And it’s a healthy company. And so, for me, it’s just super strange.

Enrico Rubboli: Originally, the industry, in a way, started as a joke, as a game. Back then, in 2012 or 2013, it was different. It was an experiment, and there was not a lot of money involved.

Michael Bille: And there were a lot of exchanges like Mt. Gox, right?

Enrico Rubboli: Yes, Mt. Gox and many exchanges failed. But it was different because, yes, people lost money. Sure. But not at this magnitude.

Michael Bille: Yes, this is a new and more significant thing. This failure will likely be a domino effect, as we saw earlier this year with Terra Luna’s collapse, which caused Three Arrows, Celsius, and Voyager to go bankrupt and fail.

And Voyager was saved by FTX, but now Voyager is open for sale again because FTX is now bankrupt. So I’m afraid this will be a domino effect because there are a lot of rumors about other entities now that are having problems with their liquidity which could hurt all the retail investors.

As you said before, Bitcoin was made for self-custody, so if you have your private keys and nobody can take away your coins. So again, that’s what it’s all about to take care of your private keys. But again, it’s not an excuse for the big players like FTX and other exchanges.

But let’s see what’s going on. It will be crazy because we have rumors about BlockFi now, which received a loan from FTX in FTT tokens. So, of course, they have a colossal liquidity issue now. Of course, we also have rumors about Genesis Global, which paused its loans and redemption. I hope for the best, but it doesn’t look good, unfortunately.

To all our community and all people, please be careful where you will put your tokens, coins, and bitcoins. Best, if possible, to keep your own private keys. Anything you want to add, Enrico?

Enrico Rubboli: Not really; be careful and keep your tokens on a noncustodial wallet where you have control of your private keys.

Michael Bille: Yes, exactly. This one could extend the crypto winter we are in right now. Unfortunately, but again, nobody knows what the market is going to look like next month or in three months.

Unfortunately, retail investors might lose their investments and savings. But it also affects the VCs because they also might lose money, so they have less liquidity to put into new startups.

And so it’s again it just involves everything in the crypto space. You have this liquidity squeeze, so you can only build new things slowly and slowly. Because now, for instance, instead of before, half of all new projects were getting funded, maybe in the next few months, it’s only two-tenths of projects that will get funded from the VCs. Firms now want to ensure they have a solid project and require more due diligence.

Enrico Rubboli: Yes, whoever can at the moment should keep working and building. I cannot make a prediction, but we are obviously in a bear market right now, and there’s no way to know how long it will last.

Usually, the bear market is where it’s better to build something, so you have less stress, less speculation, and less thought about tokens, prices, and things. You can build what you have to do and wait for the market to recover.

Michael Bille: Yeah, exactly. That’s what the Bear market is, heads down and just focusing on building the stuff, exactly what we are doing at Mintlayer. And, of course, nothing has changed from our end. We are still strong and entirely focused on developing the platform, and also we are hiring. So please take a look at our website and see the open positions we have. We are still fully focused and working hard here at Mintlayer.

Having your private keys is super important; whether your hot or cold storage wallet, have your own keys because your keys, your coins, and on the flip side, not your keys, not your coins. Also, to reiterate, when you hold your own private keys, you actually own your coins or tokens. Mojito wallet, which is now a Bitcoin wallet and a Lightning Network Wallet, is noncustodial, so users have control of their private keys.

Also, let me give an update about the Mojito browser extension. A few weeks ago, we asked our community for help testing the browser extension; 267 people signed up to test the browser extension. We received super amazing responses and feedback from you guys. Thanks to the alpha testers who gave feedback, we could spot bugs we might have otherwise missed.

Also, this community feedback helps us rethink our service infrastructure to be more resilient and improve how we provide feedback in the future from the user interface. So all the bugs and feedback are what our developers are working on for the next two weeks. When we do the development update call, I’m sure we’ll have a more precise update on this one in two weeks.

Anything you wanted to add there, Enrico, or something with the development from your perspective?

Enrico Rubboli: No, but as you said, the Mojito Wallet is the perfect example of our response to what’s happening right now. With Mojito Wallet, you have self-custody and manage your own keys, ensure that you have a strong backup of your seed, and so on.

In the future, we can start working on and discussing how to manage keys and seed phrases because it’s a vital topic. Maybe not today, but it’s one of the most critical parts of our crypto world.

You have to understand what you are doing for noncustodial and custodial wallets and the risks associated with each. And it’s a trade-off. On one side, you have the freedom, the self-custody, and the ability to control your own money. On the other side, you have centralized exchanges holding your keys and don’t have custody or control. Still, they make it easy and accessible to do many activities without much knowledge, and many enjoy the user experience.

For instance, with a noncustodial wallet, if you initiate your wallet, for example, you start your wallet, create your seed and your account, and put money in, right? But if you don’t save your seed, you risk losing everything, and you will lose everything at some point. For example, one day, you will probably sell your phone or change your phone, and you will probably forget about your wallet. So it’s essential to understand precisely what you’re doing.

So it’s a good idea to have a follow-up and discuss specifically key management.

Michael Bille: Yes, that is a good idea because it’s step one when educating yourself about Bitcoin and the blockchain. Some of the basic fundamentals you need to know are how to save your private key and what is the private key and what is the public key.

It’s required, and then you can become your own bank, and nobody can touch your value, coins, and tokens. It’s a good idea to dive into this one. We will work on making it concise, and we should put out a video on exactly how it works and why we are doing it as we do. To help people understand the security and safety of this.

Another topic on my notes is what I saw from our telegram group, where some people ask why we don’t have a Discord channel. Can you explain that, Enrico, or should I?

Enrico Rubboli: Yes. So we decided to focus on the Telegram community, which was the largest one. So we froze the current Discord community. Discord is good, and it’s used by developers and other projects that are building something, and so on. When we launch the testnet, we will likely reopen the Discord channel to involve developers and other communities. So it’s something that we are thinking of reopening.

So other projects might have their own channels, and they can promote and work together and show the Mintlayer community what they’re doing.

Michael Bille: Yes, exactly. It’s a good idea to separate the two communities because they might differ from the Telegram community. Our Discord community should be more focused on development.

It could be a place for discussing technical ideas, tests and for developers. So it’s going to be open sometime once we launch the Testnet. That’s the plan for us. Enrico, anything you want to add or should we wrap this casual Friday call up?

Enrico Rubboli: We can wrap up the call. One thing to note is we have a Matrix server, but nobody’s using it.

So it is weird because in the crypto industry. There is an awesome platform, which is Matrix, but the whole industry is still using Telegram. So while Matrix is end-to-end encrypted and is very secure and not centralized because you can spin your own server.

We have a matrix server running, and we have a bridge to link to Telegram. And because you have your community running your own server, that’s a federation. You can still connect to others, but it’s probably not as popular because the user experience is not as smooth as Telegram. So if you join the Matrix channel, you will still receive everything on Telegram and vice versa. I would be happy to see more people using it.

Michael Bille: That is good to hear. We should put the word out there and describe more what it is and why it’s better to use Matrix instead of Telegram. But again, that’s for another call.

Thank you all for tuning in this Friday, and I wish you the best weekend. And to advise you we will have the development update in two weeks at the end of this month. So I will see you then and Enrico. Thank you for joining.

Enrico Rubboli: Thank you, everyone. Have a lovely weekend.

Michael Bille: Have a nice weekend, everyone. See you again soon. See you.

Follow us on Twitter, and join us in our Telegram community to stay up to date with the latest from Mintlayer.