Bitcoin on Baltic: HodlHodl Founders on Latvia’s First Bitcoin Conference and Their Platform Launch

November 25-26 Latvia’s capital of Riga hosted its first international bitcoin conference Baltic Honeybadger 2017. Attending the event were several notable bitcoin industry players, including Andreas Antonopolous, an entrepreneur and the author of Mastering Bitcoin and The Internet of Money; Elizabeth Stark, CEO of Lightning Labs; Peter Todd and Eric Lomborzo, Bitcoin developers; and WhalePanda, a bitcoin expert and trader.

The event was organized by HodlHodl, a p2p exchange that is going to launch Q1 2018.

ForkLog talked with Max Keidun, the platform’s CEO, and Roman Snitko, HodlHodl CTO, about the conference and their own exchange.

ForkLog: That’s a very fine selection of speakers you’ve got here. It’s probably among the best events of the year in this area. Was it hard to organize it?

Roman Snitko: Thank you. It’s probably worked because we conceived it as a conference without all those talks on pumps, ICO, or unnecessary advertising. We just tried to bring interesting people together. We didn’t earn anything, and financed everything by selling tickets. We were very lucky because first we invited Andreas, then a few more people, and then they just started writing us themselves. For instance, Peter Todd wrote us and said he wishes to participate. This was a month before the event. We’re very grateful that everything worked out great.

Max Keidun: Agreed. I’ve talked about it onstage: the community and the speakers really helped us. Of course, we had some contacts, we had certain opportunities to invite people. We also had some great co-organizers, Social Discovery Ventures and OraculeTang Space. In fact we’ve made nearly 50% of all invitations, and then it was like an avalanche. People started asking could they participate too.

FL: How did you come up with the central idea for the conference?

Max Keidun: The idea came to us after we’ve held a few bitcoin meetups at OraculeTang Space. There were so many people attending we realized it made sense to hold a conference. As I said, it was intended to be a purely educative event without much advertising. We didn’t accept ICOs or other controversial projects as sponsors. Plus, we benefited from the prevailing lack of true conferences on bitcoin as technology. Many conferences that are seemingly dedicated to bitcoin are in fact about altcoins, ICOs, or blockchain. When you come there, they always try to sell or pitch something to you.

FL: Have you discussed such things with your speakers?

Max Keidun: We had conditions for all speakers from the very beginning. Do not advertise projects. Do not say that bitcoin is good, but here’s something else. We’ve sent a brief pitch to everyone we talked with, and we also had a statement on our website stipulating we don’t accept blockchain or ICO projects. This didn’t work much, though. We were receiving 3 or 4 proposals from ICOers every single day: “Let us sponsor your conference, we can send 10 grand or even more right away, just let our guy come and say what a great ICO we’re having here.”

First we were polite and answered them, but then just stopped responding. One can say we were selecting people that we would be happy to hear and see.

I think that here in Eastern Europe most people have first heard of cryptocurrencies only this year, when bitcoin and the market as a whole began expanding. Of course, bitcoin was never advertising itself, and the growth was mostly natural. But people, you know, they just throw themselves onto marketing, they want to understand everything in a second, so they’re not really good at that after all. They hear stories that someone has launched some project and raised a hell lot of money. For those reasons, people aren’t much interested in technology, they seek wealth, they seek to know when to buy and when to sell. I don’t think it’s bad, but our goal was to make the event dedicated to technology. I think we succeeded.

FL: You said you were inspired by successful meetups in Riga. But weren’t they focused on the local community? At this conference, most speakers were from abroad.

Roman Snitko: Frankly, some people at the meetups believed it would be about blockchain, ICO, or something like that. They asked lots of questions on bitcoin, of course, but we probably failed to set reasonable pricing for the local market. We received complaints on expensive tickets, and had to explain that bringing people from far away isn’t free. If most speakers are resided outside Europe, bringing them here costs some money, you know.

ForkLog: Do you think such events are important these days when there’s a lot of controversial or downright misleading information everywhere?

Max Keidun: I think it was really important. Just take a look at what happened to bitcoin: it was us who did it (laughs) [during the event the price of Bitcoin skyrocketed over $8500 and went towards the $9000 mark – ForkLog]. Actually, there were several goals we sought to achieve. First, there was a chance for old friends to meet. Our speakers often attend some conferences but there was none with such a selection of attendees, so they were happy to talk with each other. It wasn’t just about education, obviously, but also for live communication. Most importantly, however, everyone realized we were real people, not some nicknames or userpics from the internet. That’s what’s really important.

ForkLog: Are you going to carry on working in this direction?

Roman Snitko: Yes, we’re planning to hold one more conference next year.

Roman Snitko

ForkLog: What about HodlHodl? What’s that exchange all about?

Roman Snitko: It’s a p2p exchange somewhere between Bitsquare (now Bisq) and LocalBitcoins. We let users directly exchange BTC and LTC. We don’t hold cryptocurrency, it’s just a platform where one can place sell/buy orders. We started working on it back in 2015, and it took eternity. We had lots of things to do. Now we’re finally close to the launch.

ForkLog: The website is accessible, I see. Does it mean you’re in beta?

Roman Snitko: Yes, it’s a closed beta. There’s a testnet version as lots of people who start using cryptocurrency exchanges are afraid to lose their money because they just don’t know what they’re doing. A testnet allows them to trade ersatz bitcoin without risking anything.

Max Keidun: We’ll go public January 2018. We’ve got lots of questions now, people are asking when we are going to launch and hurry us. Some users, however, enjoy limited trading with real cryptocurrencies. If they insist, we can open channels for big trades. So in fact it’s a semi-closed beta.

Currently we’re testing the functionality to roll out some important features by January like mechanisms for decrease of transaction costs. A full mempool is always a pain in the neck, and as we don’t hold anything, each contract requires an escrow address with multisig. Currently there are two kinds of transactions: sending to escrow and from escrow, so you have to pay your fees twice. Sometimes they’re reasonable, but at other times they’re too high. Considering we do everything twice as cheaper as our competitors, our platform is more profitable in terms of security and pricing if you trade once or twice a month. But if you do it everyday, if you use p2p platforms and have around 20 trading operations a month, the transactions become unbearably expensive.

So what we’re doing is a static escrow address. At the beginning of a trading day, some money is sent to one escrow address, and then it uses the same functionality to distribute the money across contracts.

ForkLog: Aside from BTC and LTC, do you plan on supporting other cryptocurrencies? Which markets and countries are you going to enter?

Roman Snitko: Bitcoin and Litecoin are the only cryptocurrencies we’ll use in the near future. Supporting any new cryptocurrency always entails certain risks and takes time for developers. As for countries, we’ll work everywhere except maybe the U.S. for the reasons everyone knows. The government won’t just let them use the exchange.

ForkLog: Will there be IP limitations?

Roman Snitko: No, no IP bans. A non-resident of the U.S. might be located in America for a while, right? We’ll have a checkbox stating that you can’t use the exchange if you’re a U.S. citizen.

ForkLog: What personal data do you collect? What will users have to share upon signing up?

Roman Snitko: We don’t collect any personal data except e-mail address. They’ll have to have a login and a password, and that’s it.

ForkLog: Another important question. As we all know, SegWit and other updates haven’t been implemented by many companies. How about you?

Max Keidun: At HodlHodl SegWit is activated by default. We’re in talks with the guys who have already launched Lightning Network testnet, and we’ll sure discuss it with Elizabeth Stark of Lightning Labs. We hope it all will optimize user expenses. Of course, we wish it happened faster, but those are extremely complex things in terms of technologies and the code, so it’s better not rush things.

We all clearly understand now that transactions in bitcoin are expensive as the mempool is full of empty blocks. As one not too nice person said, that’s the freedom bitcoin gives me. Let’s just hope we’ll have as much freedom.

ForkLog: How many people are working on your project? Are you all located in Latvia?

Roman Snitko: There are 6 or 7 of us. Of course, we’re scattered across the world. I think it’s typical for the industry.

ForkLog: How did you come to the industry, by the way?

Max Keidun: I first heard about bitcoin right after MtGox. I wasn’t much scared because I wasn’t that deep in the industry, I was working for banks. However, I had some partial understanding of the technology that made me realize that banks would soon become obsolete. I decided to move in another direction as you don’t need banks when you’ve got cryptocurrency. Later on, I met Roman and we decided to launch our own project.

ForkLog: Considering the recent developments and continuing attempts of some dubious projects to hijack the name of bitcoin, what does the future hold for the first cryptocurrency?

Roman Snitko: Bitcoin is going through ordeals, and it’s likely to continue. The drama will escalate as bitcoin is a very valuable asset. It’s getting more valuable each day, and everyone wants to have it. I think the attacks on bitcoin will become more and more exquisite over time.

HodlHodl were interviewed by Andrew Asmakov