Jeremias Kangas is the CEO and founder of localbitcoins.com, as well as several other Bitcoin ventures. He is a software developer from Finland and one half of the Kangas bros team. He irradiates optimism about Bitcoin and the endless possibilities it brings, he also understands its resilience and expects it to thrive despite the many attacks that it will probably suffer from the old order that it disrupts and will displace.
Bitcoin Magazine: Why, when and how did you become interested in Bitcoin?
Jeremias Kangas: I just spotted an article about it on hacker news, and instantly started thinking how awesome it would be. At first I was mostly excited by the “money as a protocol” thing – startups and small companies can avoid fees and innovate on top of Bitcoin easily. Then slowly I started to get a larger grasp on the socio-economic implications of Bitcoin. Currently I’m mostly excited about the possibilities for 3rd world countries. The countries without a stable and cost-effective financial infrastructure or lousy national currencies can benefit the most.
BM: Why did you decide to create localbitcoins.com? Why are P2P exchanges important for Bitcoin? Isn’t Localbitcoins.com already a de-facto decentralized exchange?
JK: There were plenty of sites that listed local Bitcoin exchangers, but in my opinion they all sucked. Therefore I started doing my own, and hired my brother to help me. At first it was a really simple location-based list, with no user accounts and URL-based identifying. From there we iterated and improved the concept based on customer feedback, and nowadays localbitcoins.com is vastly different from the initial prototype.P2P exchanges are more resilient than centralized exchanges, therefore I believe that in long run decentralized exchanges will win over the centralized ones. I also believe that decentralized exchanges can make Bitcoin spread much faster – if done right. Localbitcoins.com isn’t a real decentralized exchange, as we still rely on central server. However as with anonymity, decentralization is a floating variable, not a boolean. Localbitcoins.com is less centralized than many others, and we have plans to develop our infrastructure to make it even more resilient.
BM: Localbitcoins has an extremely broad and global base; however centralized exchanges still have more depth and volume. Any plans to encourage larger volume ads?
JK: We will have volume-based discounts in the near future. I definitely agree that the depth and liquidity is a problem with de-centralized exchange model. We have some other ideas to overcome those problems in the longer run.
BM: How many users does Localbitcoins have? What BTC volume is currently being offered through your ads? Will you increase the number of statistics publicly available or offer more charts? Would you like prices set by (volume-averaged) localbitcoins transactions to be a market reference like the Mt.Gox price is currently?
JK: We currently have 44k users, and just today about 300 new user accounts were opened. Lately we’ve had around 250 new users/day. Our volume is usually in the 400-900 BTC/day range.We want to offer the charts and statistics through our website, but we haven’t had yet time and resources to do this yet. Also an API for external developers is on the roadmap.
BM: As long as you run a P2P ad service in which you don’t actually buy and sell bitcoins yourself, you don’t have to register as a MSB or comply with all the burdensome regulations of exchangers. Does that make your life easier?
JK: Yes. Of course we will still have to adhere to any regulation which might be coming for bitcoin services.
BM: Are you planning to add more security, escrow and reputation features?
JK: We will be improving the security issues with multiple methods. We will be improving the reputation system and feedback loop heavily in the coming months, so that it is more useful. We are also researching different identification methods, which would add credibility to users. Currently we have SMS based identification, which sellers can require from trading partners. We will try to keep these as optional as possible, so that individual traders can check which kind of identifications or security measurements they require. Currently traders can specify limits which depend on volumes of trading counterparties. We will add more options which allows different limits for differently reputated traders. Bitcoin-security wise I’m mostly excited about Bitcoin Trezor. If those guys manage to ship it, we could order a localbitcoins.com – branded batch and give them out to our active traders and sell and market to other users.
BM: Users can now price their BTC in XAU (ounces of gold) and XAG (ounces of silver) at Localbitcoins. Do you expect goldbugs to wake up to the fact that they can now easily buy and sell bitcoins for gold?
JK: I’m not a gold-bug myself, so I don’t fully understand the hype around it. However I realize that there exist many goldbugs in the Bitcoin community. Thus, I have myself bought minuscule amounts of precious metals. At some point I’ll try to trade them on LocalBitcoins.com, and see how we can make metal-trading easier there, or if there exists demand for it.
BM: Localbitcoins.com now has users buying and selling bitcoins in over 140 countries around the world. What are your plans for the future?
JK: We currently have 142 countries and 1700 cities, but that most definitely isn’t enough. We want to expand to at least 170.000 cities, and have LocalBitcoins.com-branded franchise exchange shops popping up here and there. Global world domination is our goal!
BM: Can Bitcoin be shut down by unfriendly regulators or governments? How could the Cuban or North Korean government stop me from buying and selling bitcoins? Are you worried about censorship? JK: Bitcoin can’t be shut down, and I’m sure that people will continue using it, whatever happens. Services like LocalBitcoins.com can be shut down, but we have plans how to make our infrastructure more resilient in a way that shutting the service down will be more difficult. I guess also other bitcoin services are designing their technology in a resilient way. BM: You are also involved in several other Bitcoin sites, like Easywallet.org and Acceptbit.com. Do you have any new projects in the works?JK: Currently I believe that we have the most impact with LocalBitcoins.com. Our team is focusing all of our efforts towards developing it.There are tons of great ideas around Bitcoin. I won’t be having any free-time from localbitcoins.com in the short-term future. I hope in year or two, I can start some cool hobby side project. Meanwhile, localbitcoins.com‘s a company will try to provide bounties for open source projects in the future, so at least that way we can participate in some cool open source projects.
Félix Moreno is a trader, entrepreneur and economist