The Global Emergence of Cryptocurrencies

and Blockchain Technology

Casey Botticello
President of The Cryptocurrency Alliance
Super PAC

© Copyright 2018. All Rights Reserved. Paid for by the Cryptocurrency Alliance Super PAC. Not Authorized
by any Candidate or Candidate's Committee.
 PRESENTED BY

T H E C RY P TO C U R R E N C Y
ALLIANCE
 Presentation Roadmap

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Cryptocurrency
in the United
CCA Super PAC

Te c h n o l o g y

International
Adoption and
Bitcoin and

Regulation
States
Financial
Markets
Beyond
01 02 03 04 05 06
3

A brief overview What is The creation of How are Cryptocurrency International

of The cryptocurrency Bitcoin and other cryptocurrencies adoption in the adoption and
Cryptocurrency and blockchain cryptocurrencies. and blockchain United States. regulation of
Alliance Super technology? technology being cryptocurrency.
PAC. used in different
countries?

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About The Cryptocurrency Alliance Super PAC

Cryptocurrency Alliance
The Cryptocurrency Alliance is an independent
expenditure-only committee (Super PAC),
founded by cryptocurrency investor and
blockchain advocate Casey Botticello. 4
The Cryptocurrency Alliance Super PAC was
created to raise awareness about
cryptocurrencies and blockchain technology,
Section 1 counter the relentless propaganda espoused
by the global banking elite who are threatened
by a decentralized currency, and to oppose
legislation and political candidates who intend
to regulate cryptocurrencies at the expense of
consumer privacy.

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 Cryptocurrency Alliance Strategy

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Political
Advocacy
Cryptocurrencies Countering 5
Education threaten the existing Propaganda
financial system, which
Cryptocurrencies and There are many
Blockchain Technology has resulted in an politicians and public
are poorly understood extensive lobbying figures who have little
by the general public. campaign by financial understanding of
One of our goals is to cryptocurrencies (or
provide resources and institutions trying to feel threatened by
information to help maintain control of the their existence),
voters understand global banking system. resting in a stream of
these concepts. political propaganda
We aim to inform we hope to counter.
voters of the facts

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behind cryptocurrency.
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“ Bitcoin and the underlying blockchain
technology promote an uncensored
network where all can participate with
equal access ” 6

Casey Botticello

President,
Cryptocurrency Alliance

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What is Cryptocurrency and Blockchain Technology?

To p i c s C o v e r e d :
7
• What is cryptocurrency?
• What is the blockchain?
• What are the layers of the blockchain?
Section 2

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What is Cryptocurrency is a
medium of exchange
Cryptocurrency? created and stored
electronically in the
blockchain, using 8
encryption techniques to
control the creation of
monetary units and verify
the transfer of funds.

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How Cryptocurrency Works

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What is Blockchain?

Disaggregated Network
Blockchain is a distributed ledger of The distributed ledger is run by a disperse network of participants. There is
no central authority like a traditional financial intermediary.
peer to peer transactions that
Distributed Ledger
allows for secure record storage.
Blockchain forms the technical
A blockchain is a public ledger that provides information of all the participants and all
digital transactions that have ever been executed. 10
backbone for cryptocurrencies such Security
By comparing the hash of the data the authenticity of the data can be
as Bitcoin but also has broad verified which helps in achieving an independently verifiable system.

applications as a ledger of various Mining

Proof of work is a protocol by which somebody can effectively prove that they
records and contracts. have engaged in a significant amount of computational work.

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Key Features of Blockchain Technology

Programmability
Some blockchains
Propagation allow for program Permanence 11
There are many copies code to be stored on With each user having
of a blockchain ledger, them, as well as their own copy of the
and no ‘master’ copy. All ledger, truth is determined
participants have access ledger entries – by consensus. Past
to a full copy of the transactions cannot be
ledger and all copies are
creating automatic edited without the consent
identical and equivalent. journal entries that of the majority, meaning
No one party has control that blockchain records are
of the ledger. New
execute automatically permanent. The entire
transactions can be when triggered. ledger is stored by each
participant and can be
posted quickly and will
propagate to all These are the so- inspected and verified.
participants’ copies called “smart

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contracts.”
 Blockchain and Distributed Ledger Technology

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Content Contract
What kind of transactions How can we animate the
do we accept? transaction history so
that events trigger
predetermined actions?
12

Communications
How are transactions created
and propagated inside and
between organizations? Consensus
How do we maintain the

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integrity of the transaction
history across organizations?
 The Four Layers of the Blockchain

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Security
Security is achieved at the consensus layer, and
requires building a consensus function that
cannot be fooled into accepting an alternate
1
ledger without using a majority of all existing
resources
The Consensus Layer
01
Liveness
Liveness is achieved at the mining layer, and 2
requires there to be enough incentive for
participants in the network to continually
confirm new blocks
The Mining Layer
13
02

Stability 3
Stability is achieved at the propagation layer,
and requires nodes to be able to quickly Propagation Layer
disseminate confirmed blocks to other nodes 03
so that they know to build on the most
recent blocks instead of older, stale blocks

4
Correctness
Correctness is achieved at the semantic layer, The Semantic Layer
where blocks have a meaning, which could range
04
from sending currency between parties as in
Bitcoin to encoding state transitions in a state

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machine as in Ethereum, and where this meaning
is validated by nodes to conform to the
specification stating how new blocks must relate
to previous blocks
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The Creation of Bitcoin and Other
Cryptocurrencies

To p i c s C o v e r e d :
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• How was the first cryptocurrency developed?
• How did cryptocurrencies other than Bitcoin
Section 3 evolve?
• What are the applications of blockchain
transactions?

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THE IDE A THAT CHANGED THE WORLD 15

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INSPIRATION DEVELOPMENT EVOLUTION APPLICATION 16

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INSPIRATION
17

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Background
• It’s late 2008, and the global financial crisis is
causing shock waves around the world. Anger at the
worldwide banking industry, governments and other
centralized authorities has reached fever pitch.

• Enter a mysterious figure named Satoshi Nakamoto,

whose real identity continues to remain shrouded in 18
mystery, to this day. Satoshi authors and releases a
white paper titled Bitcoin: A Peer-to-Peer Electronic
Cash System.

• The paper outlined the concepts for a new digital

currency system that didn’t rely on banks to
facilitate transactions or governments to create and
disseminate the currency.

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Satoshi explains how the global financial system is flawed…
The reliance on
intermediaries to
facilitate online
transactions
• No mechanism exists to make
payments over a communications
channel without a trusted party
• Satoshi proposes an electronic
payment system based on
cryptographic proof instead of
trust, allowing any two willing
parties to transact directly with
each other without the need for a
trusted third party
Currency manipulation
and control by central
banks
• Unlike traditional currencies like
the US dollar, Bitcoin doesn’t
have a central bank to ‘print’ or
produce more currency
• To introduce more bitcoins into
the network and motivate
people to keep the system
honest, miners are rewarded
with new bitcoins
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Double spending
problem and the
updating of digital
19
records
• To overcome the double spending
problem which results in a reliance
on intermediaries and a whole new
set of issues (inability to make non-
reversible transactions, increased
costs, etc.), Satoshi proposes a new
electronic payment system that
relies on sophisticated computer
encryption (cryptography) instead
of the trust generated by expensive
and slow intermediaries
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 Proof of Work

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Tie each feature to the value it
will provide to users

Satoshi’s White Mining and Incentives

Specify how each feature will be

Paper Concepts Authentication

delivered

Timestamp Server
Satoshi also outlines a Tie each feature to the ways it will
improve the user experience and
cryptographic payment solve users’ problems

solution addressing many Dispute Mediation 20

of these issues. Some of Specify when each feature will
be delivered
the key concepts
introduced are proof of Mining
Double-Spending
work, mining and Tie the features to the overall
product strategy
incentives, and a solution
to the double-spending
problem. Cryptographic Hash
Incorporate user stories in the
features roadmap

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Bitcoin is introduced, solving many of the problems
described…

21
Payment
Independence and Counterfeit-proof Anonymity and Identity Security, Control, and
Low Transaction Theft Protection Transparency
Fees

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DEVELOPMENT 22

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05
The Creation and Before disappearing from any involvement in bitcoin,
Early Use of Bitcoin 04
Nakamoto in a sense handed over the reins to
developer Gavin Andresen, who then became the
bitcoin lead developer at the Bitcoin Foundation

03 Hal Finney downloaded the bitcoin software the day it was

released, and received 10 bitcoins from Nakamoto in the
world's first bitcoin transaction on 12 January 2009.

02 On bitcoin network came into existence with Satoshi 23

Nakamoto mining the genesis block of bitcoin (block
number 0) January 3, 2009.

On 18 August 2008, the domain name bitcoin.org was

01 registered. On October 31st, 2018, Satoshi’s whitepaper is
distributed to an email list.

Hal Finney developed reusable

proof of work (RPOW) using
hashcash as its proof of work
algorithm.

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 Bitcoin Growth (2009-2018)

On August 6, 2010, a major
vulnerability in the bitcoin
protocol was spotted.
Transactions weren't properly
verified before they were
included in the transaction log.
This was the only major security
flaw found and exploited in
bitcoin's history.
In 2012, the Bitcoin
Foundation was launched.
BitPay reported having over
1,000 merchants accepting
bitcoin under its payment
processing service. Bitcoin
is discussed by Jim Cramer
on CNBC’s Mad Money.
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In 2014, Zynga announced it was testing
bitcoin for purchasing in-game assets in
seven of its games. That same month,
The D Las Vegas Casino Hotel and Golden
Gate Hotel & Casino properties in
downtown Las Vegas announced they
would also begin accepting bitcoin. The
network rate exceeded 100
petahash/sec. TigerDirect and
Overstock.com started accepting bitcoin.

2010 2012 2014

24

2009 2011 2013

On January 3, 2018, In 2011, Based on bitcoin's open
bitcoin network came source code, other
into existence with cryptocurrencies started to
Satoshi Nakamoto mining emerge. The Electronic Frontier
the genesis block of Foundation, a non-profit group,
bitcoin (block number 0). started accepting bitcoins. n June
2011 WikiLeaks and other
organizations began to accept
bitcoins for donations.
In 2013 the bitcoin-based payment
processor Coinbase reported selling US$1
million worth of bitcoins in a single month at
over $22 per bitcoin. China-based bitcoin
exchange BTC China overtook the Japan-
based Mt. Gox and the Europe-based
Bitstamp to become the largest bitcoin
trading exchange by trade volume. the
People's Bank of China prohibited Chinese
financial institutions from using bitcoins.

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In 2016, the network rate exceeded 1 exahash/sec.
The Cabinet of Japan recognized virtual currencies like bitcoin
as having a function similar to real money. In July 2016,
researchers published a paper showing that by November
2013 bitcoin commerce was no longer driven by "sin" activities
but instead by legitimate enterprises. Uber switched to bitcoin
in Argentina after the government blocked credit card
companies from dealing with Uber.
2016
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South Korea brought in a regulation that
requires all the bitcoin traders to reveal their
identity, thus putting a ban on anonymous
trading of bitcoins. With two major
improvements, SegWit and the Lightning
Network, live on the mainnet, the challenge
for the Bitcoin development community will
be to continue pushing out improvements in
2018 and beyond.
2018

25

2015
In 2015 Coinbase raised 75 million
USD as part of a Series C funding
round. In February 2015, the
number of merchants accepting
bitcoin exceeded 100,000.
In October 2015, a proposal was
submitted to the Unicode
Consortium to add a code point for
the bitcoin symbol.
2017
Japan passed a law to accept bitcoin as a
legal payment method, and Russia has
announced that it will legalize the use of
cryptocurrencies such as bitcoin. And
Norway’s largest online bank,
Skandiabanken, integrates bitcoin
accounts.[In March 2017, the number of
GitHub projects related to bitcoin passed
10,000. Bitcoin split into two derivative
digital currencies, the bitcoin (BTC) chain
with 1 MB blocksize limit and the Bitcoin

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Cash (BCH) chain with 8 MB blocksize limit.
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EVOLUTION
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The Evolution of Various Cryptocurrencies

Bitcoin 2009 27

2011 Litecoin, Namecoin,

SwiftCoin

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Bytecoin and Peercoin 2012

Dogecoin, Feathercoin, Gridcoin,

2013
Primecoin, Ripple, Nxt

Dash, NEO, Monero, Vertcoin, Stellar 2014

28
Ether (or Ethereum), Tether,
2015

Ethereum Classic,

Decred, Zcash, Lisk 2016

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2017 Bitcoin Cash, BitConnect, EOS.IO
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Bitcoin Cash (BCH)

Bitcoin (BTC) Bitcoin Cash was created

as a solution to the long-
Bitcoin is a digital currency awaiting debate in the

29
created in 2009. It follows the Bitcoin community in
Ethereum (ETH) Litecoin (LTC)
ideas set out in a white paper regards to the Bitcoin
by the mysterious Satoshi scalability issue. The
Ethereum is a decentralized Launched in the year 2011,
Nakamoto, whose true Bitcoin Cash proposes
software platform that enables Litecoin is an alternative
identity has yet to be verified. incorporates the simple
SmartContracts and Distributed cryptocurrency based on the
Bitcoin offers the promise of solution. While the block
Applications (ĐApps) to be built model of Bitcoin. Litecoin was
lower transaction fees than size limit of Bitcoin stands
and run without any downtime, created by an MIT graduate
traditional online payment at one megabyte, Bitcoin
fraud, control or interference and former Google engineer
mechanisms and is operated Cash has pushed the limit
from a third party. The platform named Charlie Lee. Litecoin is
by a decentralized authority, to 8 megabytes. This
is also the basis for its own based on an open source
unlike government-issued allows for a greater
virtual currency, Ether. global payment network that
currencies. There are no number of transactions
Ethereum is not just a platform is not controlled by any central
physical bitcoins, only processing per day.
but also a programming authority. Litecoin differs from
balances kept on a public
language (Turing complete) Bitcoins in aspects like faster
ledger in the cloud, that –
running on a blockchain, block generation rate and use
along with all Bitcoin

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helping developers to build and of script as a proof of work
transactions – is verified by a
publish distributed applications. scheme.
massive amount of
computing power.
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APPLICATION 30

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Applications of Blockchain

Walmart is The FDA is Northern Trust is The Government of Maersk is using

improving the way working with IBM working with IBM Dubai is developing blockchain to manage
food is tracked, Watson Health to and other smart contracts that and track the paper

Transportation
transported and define a secure, stakeholders to can facilitate all trail of tens of millions
Supply Chain

Government
sold to consumers efficient and launch the first trade that passes of shipping containers
Healthcare

31
across China by scalable exchange commercial use through its port, across the world by

Financial
harnessing the of health data of blockchain totaling $344 digitizing the supply
power of using blockchain. technology for billion, shift all chain process from
blockchain the private equity transactions to end to end.
technology. market. blockchain by 2020.

Many business use cases can be improved and/or solved by using distributed
ledger technology. It can be used in many cases where trust services are
needed by business applications. This can be utilized by using blockchain
technology as an application platform to build the underlying trust

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infrastructure of the system.
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The Cryptocurrency Financial Market

32

Section 4

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Prices of Leading Cryptocurrencies Price of Bitcoin

$7,013.97
Price of Bitcoin Cash Per BTC

$538.27
There are over 1700 Per BCH
Price of Ethereum
cryptocurrencies,
however, the market $279.18
st
33
is very top heavy, Price of Litecoin Per ETH 1
the top 20 $60.79
cryptocurrencies Per LTC
account for 89% of 2nd
the total market. 4th 3rd

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Market Cap of Leading Cryptocurrencies

Litecoin
$4.5 Billion

Bitcoin Cash
$12.3 Billion
34
Ethereum
$45 Billion

Bitcoin
$102 Billion

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Comparison to Major Companies

IBM Market Cap

Cumulative 35
Cryptocurrency
Market Cap

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Cryptocurrency in the United States

36
Section 5

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California
Bitcoin Friendly States Bitcoin was officially recognized as legal tender in June
2014 when Governor Jerry Brown signed Assembly Bill
129. San Francisco is considered the world's most
bitcoin-friendly city with 177 merchants that accept it
for payment as of April 2015.

Colorado
Denver lists 56 merchants that accept bitcoin payments.
Bitcoin is also being examined as a potential solution to
legal marijuana dispensaries that have to deal in cash
and cannot access traditional banking.

New York
New York City has 149 vendors that accept bitcoin
payments, which is second only to Los Angeles and five
bitcoin ATMs. Many of the best funded cryptocurrency
37
companies are based here, including: Coinbase, Circle,
21 Inc. and Bitreserve.

New Hampshire
There are no limitations on making purchases in
bitcoin, and the state reportedly has the most per
capital bitcoin purchases in the United States.

Texas
Under regulations published by the state's Department
of Banking in April 2014, digital currencies such as
bitcoin are not considered money. This means wire

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transfers and purchases or sales are not subject to the
regulations that govern equivalent transactions in
dollars. Two of the top 10 cities in the United States for
vendor acceptance are in Texas.
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International Adoption and Regulation

38
Section 6

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Have You Ever Heard of “Cryptocurrency” Survey
Yes or No Responses

European Average 66 34

Belgium 38 62

France 50

Netherlands 55

United Kingdom 61 39
Spain 67

Italy 70

Germany 71

Poland 77

Austria 79

USA 57

Australia 70
0 10 20 30 40 50 60 70 80 90 100

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Yes No
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Australia
Cryptocurrency Usage

About

7%
of Australians have purchased cryptocurrency. 40
The share of people owning cryptocurrency in Europe is still
relatively low – 9% said they had purchased bitcoin or any other
crypto, with the data for Australia (7%) and the US (8%) showing
similar results. Luxembourg (4%) and Belgium (5%) are at the
bottom of the table, while Eastern European countries, like
Poland (11%) and Romania (12%), are among the leaders in the
survey. Turkey, with its staggering 18%, tops the chart

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European Market
Sweden
Many countries may be
moving to regulate and
Iceland Finland
Russia
restrict cryptocurrency
use, but European Norway
Estonia
financial actors are also
leading the research Latvia

and development of Lithuania

Blockchain tech in Ireland United Kingdom Belarus Kazakhstan41

preparation for Netherlands
Poland
institutional and Belgium Germany
Ukraine

mainstream adoption Czechia

Slovakia Moldova

of virtual marketplaces. Austria Hungary

France Switzerland Romania Georgia
Slovenia
Azerbaijan
Armenia
Croatia Serbia
Bosnia

Bulgaria
Kosova
Montenegro
Italy Macedonia
Turkey
Portugal Albania
Spain
Greece

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 Latvia

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Germany
Lithuania
European Institutional Exchange

eland Germany is opening its first crypto exchange for whales.

United Kingdom Belarus
The company VPE Wertpapeierhandlesbank AG (VPE)
explained that they are launching a cryptocurrency
trading service for institutional investors. The exchange
Netherlands Poland
has got a license that makes of it secure and regulated
for its customers.
Ukraine
Belgium
Germany Katharina Strenski, VEP spokesperson, explained that 42
Czechia
institutional investors have been facing high entry
barriers to the crypto market and virtual currency
Slovakia Moldova
trading services. According to her, VPE is now offering a
much more convenient alternative for institutional and
important investors.
Austria Hungary
Romania OTC trader.
VPE is known as a centric exchange-based
France Switzerland Slovenia
Different clients, including financial enterprises,
investors, and institutions are able to have access to
Croatia investment adviceSerbia
and portfolio management.
Bosnia

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Bulgaria
Kosova
Montenegro
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Netherlands

Belgium
Germany
France Cze
Cryptocurrency Taxation

France has more than halved its

cryptocurrency income tax rate on capital
Aus
gains, incentivizing citizens to invest and
France 43
even take some profits in the market.
Slovenia

The French Council of State has decided to

change the classification of cryptocurrency Switzerland
Croatia

capital gains, thereby lowering the tax rate

from as high as 45% to a flat rate of 19%, a
French online publication revealed. With the
added generalized social contribution (GSC) Italy
for most incomes, the tax rate would rise
but still falls well below the 40% threshold.

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Spain
Early Regulatory Phase
Currently, there is no regulatory
framework for cryptocurrencies in

Spain Spain. Bitcoin is thus not considered 44

legal currency in the country.

Due to the absence of a supervisory

framework, the draft calls for a review
of regulations pertaining to Bitcoin and
altcoins, as well as to blockchain,
proposing to introduce the technology
to the Spanish market through
“controlled testing environments,”
commonly referred to as “regulatory
sandboxes.”

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India
Cryptocurrency Crackdown
Cryptocurrency is currently legal in India, but in
July the Reserve Bank of India (RBI) banned the
country’s banks from servicing businesses involved
in exchanging or processing digital assets. At the

45
time, RBI cited risks to financial stability and the
security of investors as being the main reasons
behind the ban.

Following the crackdown, commentators were

quick to note that, while banking activities for
crypto business were suspended, it was not a ban
on crypto in India outright. The country’s supreme
court continues to uphold the ban even after
hearing a raft of petitions.

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African Cryptocurrency Usage
Rwanda
The National Bank of Rwanda published a
document earlier this year detailing the
bank’s position on cryptocurrency and the
potential risks associated with the new
cryptocurrency market in regard to Ethiopia
established financial institutions. The bank The Ethiopian Ministry of Science and
concluded that its preparations for Technology signed an agreement with the
mainstream adoption of cryptocurrency cryptocurrency startup Cardano earlier this
include creating and regulating a bank- month. The memorandum of understanding
owned currency. signed by the two parties intends to guide
blockchain development and training for the
country’s agritech industry. 46
Rwanda
The National Bank of Rwanda published a
document earlier this year detailing the
bank’s position on cryptocurrency and the
potential risks associated with the new
cryptocurrency market in regard to
established financial institutions. The bank
concluded that its preparations for
South Africa
mainstream adoption of cryptocurrency Blockchain and cryptocurrencies are popular in
include creating and regulating a bank- South Africa, where financial institutions are
owned currency. taking notably progressive steps toward
involvement in the industry. The Blockchain
Africa Conference has convened every year

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since 2015 in Johannesburg, and partners with
IBM and Microsoft, which have been the
biggest contributors to Africa’s technological
development over the past century.
Venezuela
In hyperinflation-crippled Venezuela, privacy-

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focused cryptocurrency Dash is rising in
popularity among locals with some 200
merchants signups and thousands of wallet
South America
downloads per month. A recent survey
conducted by blockchain and cryptocurrency
startup Ripio found that Latin Americans are
Brazil
confident that blockchain technology “will Brazil’s largest investment bank, XP
build a more reliable and participatory Investimentos, is setting up an OTC
system” and “change the rules.” Nicaragua
cryptocurrency trading desk, according to a
Costa Rica recent report by Portal do Bitcoin. With over
500,000 clients and $35 billion under

Guyana
Venezuela

Suriname
Panama

Colombia management, XP’s move into cryptocurrency

Ecuador
trading would open the door for high-volume
Bitcoin trading.

Latin Americans are

Peru Brazil 47
increasingly turning to Bolivia

cryptocurrencies which Paraguay

Chile
many perceive these as Argentina
a more stable store of Argentines have been some of Latin
value and means of Uruguay
America’s earliest adopters of
Argentina cryptocurrency, with 6.1 businesses that
transaction. accept Bitcoin per million people in Buenos
Aires. However, the use of blockchain-backed
currencies is not necessarily sanctioned by
the Argentine government. Instead, citizens
have adopted the technology as a safety net
against the extremely unstable Argentine

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peso, the restrictions on foreign currency
exchange within the country, and the 32
percent yearly inflation rate.
 Thank you for watching!

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48

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© Copyright 2018. All Rights Reserved. Paid for by the Cryptocurrency Alliance Super PAC. Not Authorized by any Candidate or
Candidate's Committee.