Viktor Ihnatiuk Podcast Transcript
Viktor Ihnatiuk joins host Brian Thomas on The Digital Executive Podcast.
Brian Thomas: Welcome to Coruzant Technologies Home of The Digital Executive Podcast.
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Welcome to The Digital Executive. Today’s guest is Viktor Ihantiuk. Viktor Ihnatiuk is a Bitcoin and Web3 engineer with over 12 years of experience building core infrastructure, protocol, tooling, and privacy, preserving distributed systems, a serial entrepreneur he has founded and scaled multiple successful ventures across the crypto industry.
Viktor is currently the Co-Founder and CEO of UTEXO, a Bitcoin native stablecoin settlement network. Backed by Tether, UTEXO enables private compliant USD payments with fixed costs powered by the Lightning Network in RGB. Previously, Viktor scaled Boosty Labs into the leading European Web3 development house, growing the team to 150 plus engineers, and partnering with major industry players including Coinbase Ledger, Consensus, Moonplay and blockchain.com.
Well, good afternoon, Viktor. Welcome to the show.
Viktor Ihnatiuk: Thank you. How are you?
Brian Thomas: Great. Nice to have you, my friend. I appreciate it. And making the time. I know you’re in Europe currently to make the time today. I’m in Kansas City, so I appreciate that. I know it’s hard to make calendars meet, but you’ve traversed the globe from Ukraine to Dubai to Europe.
You’re all over the place, which is amazing, and I just appreciate, again, you. Making that effort to jump on calendar. So, Viktor, if we could, I’m gonna jump into your first question. You’ve spent over a decade building Bitcoin and Web3 infrastructure, founding multiple ventures along the way. What key experiences shaped your path from engineer to serial entrepreneur and CEO of UTEXO?
Viktor Ihnatiuk: Sure. So, yeah, after being in lots of different roles for over a decade, well, actually, like I, I was mainly entrepreneur since the beginning. But my entrepreneurship career was like, was shifting between being more on the product side, being more, a little bit on the engineering side, being more on the leadership side.
So right now I appreciate that after building. So many different companies and hiring so many great people across. All my companies. We, I believe we have around 250 people employed across all companies that I co-founded in the past. So Utexo is my new journey, and I appreciate that. Finally, I can focus more on where my biggest strengths are.
It’s leadership, communication strategy. So, this over the last decade I learned that this. The strengths can accelerate any project I’m touching. Can, uh, Utexo this new thing that that that we’re boosting now? Yeah. So something like this.
Brian Thomas: Amazing. And I really appreciate you highlighting your past experiences. Obviously, you’re a serial entrepreneur you’ve got some strong leadership skills and you’ve built a great team and a great culture, and I’ve heard nothing but positive things about it, so I’m excited to jump into the next question. Viktor, at Utexo, you’re building a Bitcoin native stable coin settlement network backed by Tether. What gap in the current crypto payments landscape were you determined to solve?
Viktor Ihnatiuk: Actually lots of different gaps. So let’s start from my first advantage or advantages of Utexo versus to other blockchains where USDT and other stable points are represented. So, I started in Bitcoin back in 2015 and I believe my one, one of my first bitcoin meetups that I ever attended was in 2015 or 16 in Kiev, in Ukraine that was hosted by Lightning Clips. And Elizabeth Stark was in Kiev when he heard about this lightning technology. For payments. And since then I’ve been very excited about this. I didn’t actually quite understand why it’s needed back then because back then Bitcoin was so small and community was so small and whitening was already building something to scale Bitcoin and to be.
Compatible on scalability and transaction speed. Execution time was within MasterCard, so I was like, well, let’s just adopt Bitcoin first and then do lightning. And so then I came back to this technology back in 2021 when I understand that well, blockchain technology is well adopted. People use it a lot, especially stable coins.
But there’s still a couple of problems on all these chains, such as block time and transaction fees. Every blockchains, have a one problem. It’s a blockchains. Blockchain is a chain of blocks and chain of blocks require you to have this kind of item called block. And block will always have block time and block size, which means blockchains will always be limited in terms of scaling.
While the only way to make. To remove those limits is not the blockchain but the centralized system. So that’s what Lightning is actually, is Lightning use blockchain as settlement wear, as anchoring wear while. Do all transactions and all executions off chain. But this off chain execution is not a typical backend which can be corrupted by a person who operates this backend.
But it’s a backend with a very interesting complementation of cryptography, primitives that helps to users and owners of this lightning nodes, lightning channels. To be a hundred percent sure that money will not disappear and rules of the transactional flow will be executed by all parties equally.
So, this is a big innovation in payments because if you can create a trustless environment off chain you can achieve any amount of scalability. So imagine that lightning can process. Transactions with the speed of, well, with speed, the speed of light, obviously because it’s lightning.
But speaking about numbers, it could be something between 50 and a hundred milliseconds, which is, wow, it’s like fasters and Visa or MasterCard. Well, you need to have a certain setups to achieve the speed, but at least it’s possible. And also lightning is quite scalable in terms of capacity of transactions that you can do per second.
Well, Solana, for example, can do 65,000 transactions per second, and everyone considers Solana as a super fast protocol. So there’s like a more faster protocols, like more, not for example, but that has, I don’t know, maybe 200 or even more thousand transactions that they can process per second.
But lightning can process. Infinity amount of transactions. It could be 1 billion transactions per second if you want. Again, all based on the setup, but it’s possible. So when I found about this, when I found that stable coins been well adopted, when I found that Stripe is building, tempo because they believe in, uh, in the stable coin payments, when I saw that MasterCard, precision Cote in that direction and lot of other companies, I was like, wow.
So all those guys finally realized that stable coins and crypto in general is very good technology for payments, but they still didn’t understand that blockchain has limitation. So that’s where I found a big opportunity to leverage all my previous skills and knowledge around Bitcoin and Bitcoin whitening and it was a great time.
When I realized this, because it was exactly the same time when maybe year after when Tetter found me and was like, oh, Viktor, we heard that you do a lot in Lightning. And I had my own venture fund, venture Studio, and we were investing in Bitcoin Lightning Company.
And we invested in two back then, and two of them been already quite famous in the small community and that heard about us and they were like, oh, we want to do a venture studio with you, but on RGB protocol. And, RGB I heard about RGB back in 2018, I guess because the guy who been the biggest developer of RGB I onboarded him to Bitcoin back in 2015, but I was like, oh, why RGB is still not showing up, like why, why the development took so long.
So, when I understood that actually there’s some help needed to push it and Tether, or offer it a joint venture. Idea of bringing RGB to main net. I always took this opportunity because it was hard to refuse partnership with the biggest crypto company ever. And so especially when they want you to help to bring, USDT back home, because originally in 2014, I used the T and issued on a Bitcoin blockchain with an omniware.
Then they moved to Ethereum and drone in 2018 or 2019 kind of organically because Omni layer and Bitcoin generally was quite slow. And they sought to move, uh, USDT over Omni to Lightning. But technology was quite bad. That’s why they decided to. Invest in in RGB and support the teams who are building this.
But those teams sadly were moving so, so slow. So that’s why, uh, now we have. Hundreds of billions of USDT on Ethereum and, and drone and almost zero, or actually zero on Bitcoin. So, so yeah, so I, I was like, oh, wow. So I can actually finally solve this problem bring Bitcoin back home, but also, bring, uh, USDT back home to Bitcoin and make this the best USDT because it’s the will be the fastest, the cheap.
Also the most private while still compliant. So, yeah. While UN understood this opportunity, I started to work hard and it’s gave some results Back in July last year, we finally launched RGB to main net me, Federico Tanga from Tether and Zuko, who was original. Founder of RGB started RGB Protocol Association.
Then I came up with a DFU Tech as a global settlement layer for USDT and Bitcoin. And, and that’s how we slowly transitioned our joint venture with and fulger from 2023 and the companies that now called UTEXO and yeah, this was quite a journey. And so, yeah, I’m super excited what we do because I think it will, it’ll change the world of stable coin payments forever and in a way that most of other big payment companies even don’t understand now, because it still live in a paradigm that.
Blockchain is a, is a great technology for payments. While I would say that blockchain is a great technology for settlements of off chain stay. So that’s that’s I think will be a future and I’m so, proud that we do it.
Brian Thomas: Thank you so much. Lot to unpack there. I appreciate the backstory, Viktor, but the key thing that I took away obviously you were an early adopter of blockchain and Bitcoin crypto and then you were very interested in lightning payments, obviously, right?
It’s gonna become a game changer for stable coin payments, but we all know blockchain’s pretty cool, but there are some limitations, obviously you talked about the block. Time, the block size. But with the Lightning Network the speed and scalability is just amazing, and we know that and talk to many of your peers on this podcast about the speed of lightning.
So thank you. And Viktor. Privacy and compliance are often framed as opposing forces in crypto. How do you approach designing systems that protect user privacy while remaining aligned with regulatory realities?
Viktor Ihnatiuk: It’s a great question actually. RGB used technology called client side validation, which means.
That only sender and receiver of transaction know the final state of a transaction. Everyone else sees that some transaction happens. If you want to use RGB over Bitcoin, if you use RGB. Over lightning. It’s even more private because lightning post transactions only when they do rebalancing.
So, it means that, like inside of the chain environment, the, uh, privacy even more private, however. The beauty of Bitcoin is that Bitcoin is a peer-to-peer cache system as an opposite to all other blockchains. But what does it mean? So, cash is. The paper bills and every paper bill are unique because they have its own numbers.
And I know some, someone can inscribe something on a paper bill the same way Bitcoin works with the same code UTEXO. UTEXO is kind of a digital representation of a bill on a Bitcoin and UTEXO can be. One OSH or 1 million or even one Bitcoin. So, this like a UTEXO source can be of a different size, and every time when you send a transaction on Bitcoin, the, on the backend, it’s actually a, not like an on Ethereum.
On Ethereum, if you send a hundred USDT to a person who has, let’s say 500 ut on his balance. And then this person will decide to send you a hundred USDT back. It’ll be not the same USDT, it’ll be just a hundred USDT from the balance of 600 USDT, from a sender wallet while in Bitcoin, if you send let’s say one Bitcoin to another person.
And you have UTEXO that has two bitcoins on it. The A transaction looks next, you send two Bitcoin to another person and another person send you a change. And this change is a split of your UTEXO into two pieces. So, receiver will get. One Bitcoin out of your original UTEXO that will represent a change of one Bitcoin that you will get back.
So because of this every UTEXO unique and because every UTEXO unique, you can inscribe whatever you want on top of this UTEXO, that’s how issuing of USDT works on bitcoin. RGB protocol allows you to inscribe on a specific Bitcoin UTEXO. Usually it’ll be small UTEXOs because it doesn’t make sense to inscribe a hundred.
USDT balance on UTEXO as it has one Bitcoin. But. Once you inscribe a specific USDT balance on a unique UTEXO and this and this like a USDT will be sent to, to someone else. This, someone else will not get UTEXO but will get, we’ll get kind of just like a balance change, but UTEXO that associated with this, like a new balance update will still be unique.
Long story short because every UTEXO unique privacy is possible only for general audience, but if as there is a hack or some malicious activity or something that should be reported where it should be blocked, Tether will maintain a blacklist server that will mark a specific UTEXO so suspicious.
So, none of the exchanges, none of the wallets, uh, none of the, like, legal operators will never touch it. So that’s how you can maintain privacy but still be compliant if in case this USDT will be used for some suspicious activities. This is the beauty of Bitcoin where UTEXOs are. Could be used to give a privacy but not compromise the, like a legal requirements of, of society.
Brian Thomas: Thank you. I really appreciate that. And you, just to break it down real quick, the benefits of UTEXO has that unique tracking and privacy capabilities. Obviously privacy is key. While everybody can see that a transaction happened. Really, the sender receiver can only see the transaction details, which I thought was unique, but I didn’t know this.
You talked about that tether blacklist for suspicious activity with transactions, and again, limiting. Those possibilities of fraud and loss of funds. So, I appreciate that. And Viktor, the last question of the day, if you could briefly share as we look ahead, how do you see Bitcoin’s role evolving over the next decade from a store of value to a full financial sediment layer?
What breakthroughs will unlock mainstream adoption?
Viktor Ihnatiuk: I think similar use cases like we build in new tax will help to Bitcoin get its adoption at a very higher level because, once UTEXO will show that Bitcoin can actually be used for payments, and I believe payments is the biggest use case of a future of Bitcoin.
I believe second biggest will be trading. It’s it’ll create lots of utility for those UTEXO source to inscribe on them something, and then use as a representation of currencies that have been issued on Bitcoin. And once people will understand that scalability technology for Bitcoin such as lighting technologies like RGB could be served.
Yeah, same. In like, in the same direction as like a typical Ian platforms on Ethereum or I know Solana, they could start slowly to move back to Bitcoin and once it will happen, the utilization of Bitcoin’s UT so will increase a lot, which means that utility of Bitcoin will be a little bit recreated.
Right now, the main utility of Bitcoin is kind of a digital gold. People just bank it and ho link it, but there is also some additional. Synthetic derivative activities happening with Bitcoin, like ETFs like all different law on products and things like this. But on a programmable level, Bitcoin is still an asset.
However, Bitcoin can be kind of a monetary system. And so imagine like a gold standard when, people were doing gold coins. And gold was gold, but every country has its own currencies and different nominals of those currencies. So this could happen lit. Little bit similar could happen to Bitcoin.
If okay, UTEXO with STAAR will execute, right, or not eve, but when we’ll execute and bring adoption for a payment use case for, and then hopefully, other companies will follow our example and hopefully big trading firms or I don’t know, exchanges will realize. Oh wow, actually it’s so quick.
So, we can build also HFT use cases, and if you can build HFT grade exchange on top of a trustless solution such as writing, then, which will be also cheap to use, then why you need a centralized solution. So maybe bin or Okay X will move to a similar technology like we do in UTEXO.
For their operations. Once it’ll happen, it’ll be just a Cambrian explosion of use cases for Bitcoin and and UTEXO usage which which will grow a lot Bitcoin and price.
Brian Thomas: Thank you. I really appreciate that. And you’re right for adoption, payments, as you said, trading’s a big one, but payments are probably the biggest use case for future Bitcoin adoption.
And how do we get there? You talked about with the help of lightning RGB, it’ll be a much easier for Bitcoin use and adoption. And again, I love how you broke apart and unpacked some of the work that you’re doing to, again keep privacy, but keep the transactions safe, secure, and I just really love that you really went in depth today on bitcoin transactions and the blockchain, so I appreciate that for my audience especially.
And Viktor, it was such a pleasure having you on today and I look forward to speaking with you real soon.
Viktor Ihnatiuk: Thank you, Brian. I appreciate for hosting me and yeah, try to cover a lot on a technology side because I think that we need to educate people about beauty of Bitcoin because people just think that Bitcoin is just something slow and very old, which is kind of true, but Bitcoin has something else that people need to discover just to understand its power and finally come back to building on Bitcoin.
So that’s why I would love, to be an evangelist as okay in a way. I was back in 2015 when I did first Ukrainian Bitcoin conference. So probably coming back to this role again, but in a different head.
Brian Thomas: Thanks again. Bye for now.
Viktor Ihnatiuk Podcast Transcript. Listen to the audio on the guest’s Podcast Page.
