The Block: Jack Dorsey says plan for 'TBD' bitcoin project is to build a decentralized exchange

Last month, Square CEO Jack Dorsey disclosed plans for a project called TBD that, at the time, would focus on the development of a platform for open-source financial services dedicated to bitcoin.

That project has a clearer roadmap, according to Dorsey as well as Mike Brock, the CashApp exec put in charge of the initiative: a decentralized exchange. A decentralized exchange is a system for trading wherein no central party has custody or control of funds that pass through it.

We’ve determined @TDB54566975’s direction: help us build an open platform to create a decentralized exchange for #Bitcoin https://t.co/jHYWHy1qmu

— jack⚡️ (@jack) August 27, 2021

In a tweet thread , Brock wrote that "[w]e believe Bitcoin will be the native currency of the internet. While there are many projects to help make the internet more decentralized, our focus is solely on a sound global monetary system for all. But including all requires a few pieces we think are missing... Getting bitcoin today typically involves exchanging fiat at a centralized and custodial service like @CashApp or @Coinbase . These on- and off-ramps to Bitcoin have a number of issues, and aren’t distributed evenly around the world."

He went on to say:

This is the problem we’re going to solve: make it easy to fund a non-custodial wallet anywhere in the world through a platform to build on- and off-ramps into Bitcoin. You can think about this as a decentralize[d] exchange for fiat. As we said, this platform will be entirely developed in public, open-source, open-protocol, and any wallet will be able to use. No foundation or governance model that TBD controls. Permissionless or bust."

Brock noted that the exact design principles for this platform aren't fully ironed out, highlighting Rootstock, a smart contract-enabled sidechain of Bitcoin, as one potential option. "However, the gaps needed to build this may be too large, which would also have us consider other chains as a bridge," he went on to add.

"Some of the gaps we currently see are around cost and scalability. Lightning is solving for this with payments. We need a solve for exchange infrastructure between digital assets, like stablecoins," Brock wrote.