Bitcoin Foundation, the non-profit organization based out of Washington D.C., dedicated to popularize bitcoin adoption among individuals and to lobby with companies and governments. In a recent AMA on ZapChain, the community forum and social network for cryptocurrency and Internet of Things (IoT), the Founding Director Jon Matonis explained about Bitcoin Foundation’s finances.
The Bitcoin Foundation had experienced a loss of about $4.6 million over a period of 6 months during 2014. According to Jon Matonis, the losses were due to multiple reasons including increased spending on monthly expenses, conferences and bitcoin price volatility.
The Bitcoin Foundation’s tax documents for 2013 has raised many questions among the Bitcoin community regarding the usage of funds. The tax document shows that the foundation has spent a major chunk of funds on conference costs, employee compensation and legal fees totalling over $150,000 per month. The earlier mention of 5,800 bitcoins in its 2014 transparency document and its expenditure is being questioned by people while awaiting for the tax documents for 2014.
As a part of the AMA, Jon Matonis answered questions regarding foundation’s realignment and Bitcoin Better Business Bureau – Cryptoagency. While assuring the Bitcoin community about the Bitcoin Foundation’s expenditure, Jon said that the foundation is not involved in any funny business and bitcoin price drop was a major factor that has affected the body’s funds. The drastic drop of bitcoin price from over $1000 to $264 by the end of 2014 resulted in severe losses for the foundation.
According to him, when the foundation was first evaluated at $4.6 million on March, bitcoin prices were at $673 and as over 90 percent of the foundation’s assets are maintained in the form of bitcoin, any change in bitcoin value will be directly reflected on the foundation’s asset holdings. As the bitcoin price hit $264 early this year, the assets stood depreciated. Whereas, the $150000 went for foundation expenses.