BTCPay Server Foundation - Introspective

Posted in Announcements by Nicolas on 3/8/2020

Since I announced the BTCPay Server Foundation (opens new window) at the Baltic 2019 Honey Badger a lot has been happening behind the scenes. We decided to share our story, not just to be transparent to our supporters, but also to share our experience with the community.

We initially created the foundation as an LLC in the US. This seemed a good option as we estimated that the largest portion of supporters would be US based. Creating a proper non-profit in the US requires tons of upfront paperwork while it was unclear if we would receive a single satoshi.

LLC was setup thanks to @r0ckstardev and @vandrewattycpa. @r0ckstardev was willing to take over all formal liabilities arising from this setup and take care of all operational duties (accounting, reporting, transferring money to contributors around the world, etc). We started receiving donations to this entity from Square Crypto, DG lab, ACINQ, LunaNode and Wallet of Satoshi.

As time passed, we realized that this structure will not work in the long run and that, as the main founder of the project, I should better take more responsibility and initiative on it. For that reason, I started the process of opening the BTCPay Server Foundation in Japan instead. We decided to hold off donations from new supporters and postpone payments to contributors until the foundation is established in Japan. We moved the remaining funds temporarily under my control in Japan, until I can transfer the money to the new Japanese foundation.

Finally, BTCPay Server Foundation is now based in Japan. This is a 一般社団法人 (a real non profit association, not taxed on profit). The Japanese law requires three "board members". I am the main representative and board member, the other members are @jimmyhomma (opens new window) who is a close bitcoiner friend and Kanai Masayoshi who has been my tax accountant for 2 years already. While they are board members, their role will be mainly passive. I still need to report to them so they can be confident that the foundation is administrated properly and lawfully.

My role in the foundation is mainly administrative, the goal of this foundation is to help supporter's money finding their way to BTCPay Server's contributors pocket. Supporters and contributors are the one deciding to collaborate around the foundation and keeping it alive.

Creating a company and opening a bank account in Japan has been time consuming, especially when your Japanese is not that good. The entity creation took one month and a half, and three more weeks to open a bank account... or not, as I received the rejection of our demand. The fact that my Japanese is not very good and that they saw "bitcoin" and "payment processor" might have played a role...

Luckily, in Japan, while inconvenient, companies can operate without a bank account. It means that the foundation will not be unable to make or receive wire transfers momentarily, until we find a bank willing to take us. Our only solution is to operate the foundation's money directly from the Japanese exchange BitBank (opens new window), using them as a bank and only using bitcoin when payment need to be received or made. While I wish we could keep the bitcoin under our own custody, at this moment, accounting properly bitcoin holding in Japan is a significant burden, and neither me or my tax accountant have time to dedicate.

As such, we will "reopen" the foundation in the next week or two, when our exchange account gets properly set up.

A reminder of our grants until now:

  • Square Crypto: 100 000 USD ( 33333.32 USD received to this day, because we requested donation to be spread in 12 monthly installments)
  • Digital Garage: 30 000 USD
  • ACINQ: 11 150 USD
  • Wallet of Satoshi: 5 000 USD
  • LunaNode: 5 000 USD

That means we received 84483.32 of the 151150 USD in total. When I finished transferring funds from my own custody to the Japanese foundation, we will have 42916,67 USD. To this date, I paused the promised donations to various contributors for a total of 28400 USD, that will hopefully resume soon. We still have to rework on contracts (because we changed jurisdiction) with Square Crypto for receiving the remaining 66666.68 USD, that may take time.

We have a few more things to figure out. On the bright side, we are confident that we should be able to open an account on one of best Japanese exchanges - BitBank (opens new window) and manage the foundation's finance from there.

Our next step is finding a bank that can provide us with a bank account, so that we can receive and distribute funds to contributors who prefer to get fiat.

Thank you for your patience, we are learning as we go!

Last Updated: 9/13/2021, 12:32:53 PM