Dialogue with Core Foundation Founding Contributor: How to Build a New Bank for Bitcoin

In this interview, Rich Rines, a founding contributor of the Core Foundation, shares the organization’s development in Bitcoin yield infrastructure and future plans. Core’s unique approach, including the innovative Satoshi Plus consensus mechanism, is transforming how Bitcoin is applied, unlocking its potential in staking and yield generation. Rines also discusses Core’s vision of connecting Bitcoin with traditional finance (TradFi) and decentralized finance (DeFi), as well as the innovations shaping its ecosystem, including a new Bitcoin bank, cross-platform integrations, and institutional-grade yield products.

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Background of Rich Rines

Rich: I entered the cryptocurrency space in 2013, right after graduation, and developed a strong interest in the industry. By 2017, I started working full-time in crypto. I joined Coinbase, where I worked for four years in funds flow engineering, handling trillions of dollars. That experience was very exciting, but eventually it ended, and I started looking for the next direction. Core was an obvious choice for me. I’ve always been a Bitcoin maximalist—now I can be considered a Core maximalist and a Bitcoin maximalist, if you interpret it that way. The initial idea was that we had so many Bitcoin sitting idle—how could we put them to more productive use, like staking and earning yields? That’s how Core originated.

We’ve been live for nearly three years now, which is hard to believe. I remember it like it was yesterday. As for my role, I’ve done many things—helped set the vision and direction, and handled a lot of daily operations. It’s been incredibly interesting. Bitcoin’s application space is still in its early stages; we’ve probably only scratched 1% of its potential use cases. There are ten more years of work ahead of us. But we’re very excited to be on this journey and to share it with everyone.

What is the yield generation mechanism of Core’s Bitcoin Yield ETP on the London Stock Exchange?

Rich: Launching Core’s Bitcoin Yield ETP on the London Stock Exchange is very important for us. It’s the first Bitcoin staking product listed on a major stock exchange globally. We’ve previously launched ETPs on other exchanges, dating back to early 2024, but the London listing is a milestone—our presence on a top-tier exchange.

Regarding how yields are generated, let me first explain Core’s consensus mechanism briefly. Core has an innovative consensus called Satoshi Plus. Unlike most Proof-of-Stake (PoS) systems that only stake local tokens, we allow users to contribute three scarce resources to earn staking rewards. You can stake Core’s native token, stake Bitcoin, or delegate Bitcoin’s mining hash power. This process is similar to merged mining but without negative externalities. Currently, over 90% of Bitcoin’s hash power is delegated to Core, which has been a long-term project for us.

Returning to yield generation: when you stake Core or Bitcoin into these local resources, locking the entire chain, you receive staking rewards. That’s how the product works—you’re effectively staking Bitcoin, and the yields are generated from these Bitcoin holdings, ultimately returning to the product holders.

This is the first product to combine traditional finance with retail crypto products, especially Bitcoin staking, making it accessible to a broader audience. I believe that a major story for Core in 2026 and beyond is how to gradually unlock more cross-sector hybrid applications, integrating traditional finance with on-chain experiences.

The basic idea of generating yields is to use one of the three scarce resources I mentioned earlier to secure the Core network. By doing so, you earn Core’s block rewards and transaction fees, which are common in crypto ecosystems. As more people use CORE, yields will improve. This is driven by increasing demand for the CORE token—through on-chain use cases like gas fees, staking, governance, or through buybacks and revenue from different teams within the Core ecosystem, or future projects the Foundation may or may not undertake.

This is a major story for us. Over the past year and a half, we’ve seen that focusing solely on a general Layer 1 hasn’t met expectations; instead, building innovative applications and services to enhance blockchain value has become more important. That’s what we’re doing—driving vertical integration and helping build top-tier protocols on the Bitcoin yield infrastructure engine of Core and on the EVM (Ethereum Virtual Machine) ecosystem we’re developing. You’ll soon see some exciting announcements and analyses about our products and services. We’ve discussed some promising use cases, like SatPay—our Bitcoin bank developed in partnership with Mobilum.

What are the core partnerships and risk management elements necessary to successfully build the Core ecosystem?

Rich: The Core ecosystem is quite broad, including staking, custody, and related areas. We have some long-term partnerships with top service providers. These include BitGo, Copper, Hex Trust, Ceffu, and Cobo—all leading global custody providers supporting not only CORE token staking but also Bitcoin staking and a dual staking system for CORE. We reward users through staking Bitcoin and CORE tokens, with multipliers.

Additionally, we maintain long-term relationships with top validators like Fireblocks and Figment. This is very important because it helps us provide institutional-grade services, ensuring our end users can rely on the best providers.

Over the past three years, we’ve focused on onboarding these top partners. For market entry and distribution, we also work with excellent hardware partners like Ledger, which fully supports Core’s Bitcoin staking and dual staking. This ensures that users worldwide—whether individuals, large institutions, or funds—can enjoy top-tier hardware wallet experiences.

We’ve covered a broad spectrum of these partnerships and are committed to providing our users with the best possible collaborations.

Are institutional demands more about Bitcoin yield needs or about regulated, deployable Bitcoin infrastructure?

Rich: It really depends on the end users. But if I focus on the mainstream market, I’d say institutions mainly have two needs. First, they want to earn yields from Bitcoin; second, they want to use Bitcoin as collateral to leverage. There are many other interesting Bitcoin applications, like Bitcoin payments or private Bitcoin transactions. However, I believe these are not yet mainstream and may take some time to fully develop. We’ve always known that these use cases will take time to materialize.

Honestly, we initially thought Bitcoin’s application space would develop faster outside these two main use cases. So, one of our main focuses is providing products and services that users need today, rather than building a future vision that might only materialize in five or ten years. That’s why we focus on yield generation protocols, asset management protocols, and similar projects that can unlock large Bitcoin capital pools. Our primary target audience for these products and services is to deliver real value today.

But infrastructure is something I definitely don’t want to overlook. We have the fastest, most performant Bitcoin blockchain and will continue to innovate and lead in this space. Multiple BTC-Fi protocols are growing and expanding on Core, and we will keep nurturing and expanding this ecosystem, with performance improvements continuously benefiting it.

In other words, Bitcoin’s application space has two different directions. Currently, products for institutions have a higher market fit than those for retail, but we will continue to develop both. I believe this puts us in a very unique hybrid position—we can provide neutral yield infrastructure. We can serve major institutional clients on large exchanges while also offering experiences for small retail users. I believe we are the only project capable of occupying both these domains simultaneously.

How does Satoshi Plus inherit Bitcoin’s security and introduce new trust assumptions for safety?

Rich: Satoshi Plus is the innovative mechanism we mentioned. Its core idea is that our consensus system has three different components. You can stake Core, stake Bitcoin, or delegate your mining hash power, involving thousands of Bitcoin and millions of Core. Currently, about 90% of Bitcoin’s hash power is securing the network. By integrating these three different security vectors, it not only consolidates Bitcoin’s security but also enhances Core’s security.

Regarding trust assumptions, it’s important to note that staking Core, staking Bitcoin, or delegating mining hash power does not introduce new trust assumptions. We aim for the entire system to be fully trustless. For example, when you stake Bitcoin, you use hash time locks, meaning you lock your Bitcoin so it cannot be transferred or operated on for at least a day. During this period, you never relinquish control—your Bitcoin remains in your wallet. This guarantees the highest level of security. We don’t want to create a product that claims to be decentralized custody but has hidden pitfalls. The design is based on the highest security and trustless principles.

For Bitcoin miners delegating hash power, what is the long-term value proposition? Which is most sustainable?

Rich: The history of Bitcoin miners participating in merged mining systems is long-standing. In short, miners redirect part of their hash power to solve puzzles on two networks, earning block rewards from the merged mining ecosystem. While this can be successful in some cases, it often isn’t, because it can create negative relationships between the miner and the host chain of the second network.

When we built this delegated Proof-of-Work (DPoW) system, we found a way to make delegation trustless. Miners add some data in the OP_RETURN field, removing incentives for censorship or Byzantine activities. This helps maintain system balance. In return, miners receive Core’s block rewards, helping to secure the network.

A long-term value proposition we’re beginning to see is that miners are not only using it as a new token issuance platform but are also starting to stake Bitcoin. Previously, miners could fund their operations by selling Bitcoin or using various hedging strategies. When we introduced delegated hash power, miners also gained an additional option: staking Bitcoin or Core, reinvesting these assets to continue funding their operations. This provides miners with more tools and helps secure Core while maintaining Bitcoin’s decentralization. We’re very proud of this Satoshi Plus consensus mechanism.

How does the non-custodial Bitcoin staking model work, and what is the redemption process?

Rich: First, you initiate a hash time lock transaction, specifying how long you want to lock your Bitcoin and the reward address on the Core chain where you can claim rewards for helping to secure the Core system. If you’re doing double staking, it also considers the reward address to calculate a multiplier, which applies to your Bitcoin staking transaction and the resulting rewards.

The key is that all this is done within Bitcoin scripts—you’re essentially trusting yourself. It’s a self-custody process. When you lock Bitcoin, it cannot be moved during the lock period, which can be as short as one day. But it always remains in your wallet. Unlike transferring funds to others, no one else can operate on these funds because they don’t have the ability to do so. Bitcoin always stays in your control. This process of locking Bitcoin is similar to how staking funds are delegated in PoS systems.

This is a major breakthrough: we’ve introduced some dynamics from PoS systems and applied them in a new way to Bitcoin. It unlocks a new feature for Bitcoin holders—earning yields through staking without relinquishing control.

How do you assess the quality and sustainability of BTC-Fi’s TVL growth from 2024 to 2025?

Rich: I think in 2024 and 2025, we’ll see a typical hype cycle, similar to the Caroline Perez model—people are very excited, perhaps a bit over-optimistic because the technology isn’t fully mature yet. Bitcoin DeFi is no exception. We’ve seen similar situations before, like the DeFi summer of 2020, where expectations far exceeded reality.

Since then, the Bitcoin DeFi space has cooled down, and people are re-evaluating trust assumptions, how they deploy Bitcoin, and where sustainable yields can be achieved. It’s a very healthy process. Before fully realizing utility and value, this re-evaluation phase is necessary. We’ve gone through the same process, which is why we’re now focusing on Bitcoin asset management protocols and products like SatPay. These are activities we believe can bring hundreds of billions of dollars in real TVL over the next few years, and ultimately, these will be the most feasible applications of Bitcoin. That’s the direction we want to push.

Over time, more applications will continue to develop and mature. We just need to give it time until it’s mature enough for full-scale expansion.

How does the Bitcoin bank bring value to Bitcoin holders?

Rich: If we look back at Bitcoin’s original value proposition, it’s about sovereignty and becoming your own bank—that’s why I got into Bitcoin 13 years ago. I was completely captivated. Looking at the industry now, what have we done well? We’ve created a better gold standard, but I don’t think that was Bitcoin’s original purpose. Bitcoin was meant to be peer-to-peer cash, but it has evolved into something truly incredible. I think we should all thank Bitcoin for what it has contributed to the world and what it will continue to do.

However, I believe some other Bitcoin use cases are still underutilized. This is a focus of mine, especially when we conceived Core a few years ago—how can we help realize this vision? A lot comes down to practicality. People want to generate income with Bitcoin, earn yields, lend, basically use it like a savings account. Many people worldwide lack bank accounts or have limited banking services. We are in an unprecedented moment of low trust in traditional financial institutions. The idea of a Bitcoin bank is very appealing—using Bitcoin as a savings account, lending platform, and investment tool. That’s what SatPay is about. It’s a product of our partnership with Mobilum, a global leader in crypto cards. It’s a full-featured product, and we’re very excited to launch it in the first half of 2026.

With SatPay, Bitcoin holders can now bring their Bitcoin into this system, unlocking all these key use cases. They can also get low LTV loans using Bitcoin and use them for stablecoin spending. This completes the Bitcoin value cycle—many people just want to accumulate more Bitcoin and integrate it into daily life.

That’s exactly what SatPay aims to achieve. It embodies the concept of a Bitcoin power grid. Core is the Bitcoin yield infrastructure, more broadly, Bitcoin infrastructure. We support these different products and services, which in turn flow back into the Core ecosystem through buybacks. SatPay is just one example. We’re building various yield products, some involving dual staking and other strategies. Part of the yields generated will be used for CORE buybacks, directly benefiting CORE token holders. This represents a shift—moving beyond just Bitcoin applications to how these values are directly returned to CORE token holders.

What are the biggest challenges when expanding a new crypto bank? Compliance, integration, or risk acceptance?

Rich: The Bitcoin bank space indeed faces many challenges. That’s why we’re very fortunate to partner with Mobilum, which has global licensing and extensive experience in card services, having been involved for many years. This was crucial for us to quickly launch the product. But overall, it’s still a tough industry. There are many competing products, and differentiation is very difficult. It’s similar to classic Web2 growth stories—our team has extensive experience in Web2 business growth, including myself. We’re very excited to bring this product to the masses.

Fundamentally, it boils down to customer acquisition and activation—challenges everyone is familiar with. Additionally, we have a global audience, not limited to a specific region or banking system. While there are many challenges, there are also many opportunities. I expect SatPay to grow significantly by 2026.

Within the Core Foundation’s ownership and partnership strategy, which parts should be fully owned? When is a partnership more suitable than vertical integration?

Rich: That’s a very difficult question because in many cases, we could say “we do it ourselves.” But the key is where we can create the most value for users and token holders in the shortest time. I think partnering with Mobilum to launch SatPay is a perfect example. Currently, Core doesn’t have the capacity to operate across many different licensing regimes worldwide, so working with a team like Mobilum, which can handle those aspects, is very important. On the other hand, we are very strong in market entry strategies and distribution. This kind of partnership creates a 1+1=3 effect.

For other products, we believe it’s more appropriate to develop and support them ourselves. Especially for Bitcoin yield products, some of the things we’ve done in the past, I expect we’ll launch as standalone products. This is because, in Bitcoin yield and infrastructure, we are experts with full customer relationship chains, so controlling the entire process ourselves makes more sense.

How does the Core Foundation plan to integrate Bitcoin DeFi with traditional finance in the future?

Rich: In the next chapter, we want to demonstrate that a long-term, healthy Bitcoin DeFi protocol can scale into traditional finance. The biggest challenge is this hybrid development—people tend to focus on one side and don’t achieve product-market fit on both ends. We have experience in both areas, and I believe we will be the first team to successfully bridge this gap—bringing Bitcoin DeFi yield experiences into traditional finance, helping us scale into that sector. If we can become a yield infrastructure for ETFs and other financial products, that would be a very exciting business. I believe this will be very beneficial not only for the Core ecosystem but also a huge opportunity for CORE token holders. Ultimately, no one has yet completed this closed loop, and I believe we are the most capable team to do so. That’s our story for 2026 and beyond.

What are your thoughts on AI’s rapid development attracting capital and talent away from the crypto space?

Rich: I think this kind of phenomenon is usually part of a hype cycle. If you remember 2022, there was a tweet saying everyone in crypto was switching to AI, then some people returned to crypto, and now AI is making a comeback. I think it’s very normal—people like to chase different goals, and right now, AI and crypto are the two most exciting fields in the world. You might see many smart people working in both areas, though obviously juggling both is challenging.

Ultimately, it depends on where you believe you can build the most impactful and influential company. Core is currently very focused on Bitcoin, which I believe is a huge space, and we will continue to focus on it for many years. But many excellent AI entrepreneurs will also continue to achieve extraordinary things in that field.

Do you have a bullish outlook on Bitcoin’s long-term prospects for 2026? What factors could change your mind?

Rich: I am always bullish on Bitcoin. I believe this will never change, even after 13 years. I’ve been through many moments that could have changed my view, but I think my long-term outlook remains the same. We see Bitcoin’s volatility being suppressed by ETFs and other factors, which may be harder for native crypto users to fully understand, but I see this as part of the healthy maturation of the crypto industry. Additionally, geopolitical and macroeconomic factors should be very favorable for Bitcoin. I hope Bitcoin continues to bring benefits to the world. Overall, I remain long-term bullish on Bitcoin—I think I always will be. So yes, I am forever bullish on Bitcoin.