In this episode, Sunny Ray reconnects with Scott Millar of BlockSettle, whom he first met around 2012 through the early Bitcoin exchange scene. Millar traces his path from trading interest rate derivatives in London, to running his own trading firm in Sweden, to discovering Bitcoin in early 2012 through an article on the Pirate Bay case. He describes early wallet options like Armory, Bitcoin Core, and Electrum, and how his background building matching engines and clearing systems led him toward exchange infrastructure. After a Swedish exchange venture fell apart, Millar teamed up with Armory's lead developer to found BlockSettle in 2016, building on Armory's open source codebase. The conversation covers BlockSettle's non-custodial exchange model, where cash is held by the platform but bitcoin moves directly between counterparties using a request for quote system similar to FX markets. Millar also explains tokenized securities traded against bitcoin via coinjoin transactions, then walks through a live demo of the BlockSettle terminal, showing wallet functionality, hardware wallet integration, and real time RFQ trading.
Scott Millar explains how BlockSettle lets traders swap bitcoin for cash without ever giving up custody of their coins.
What were you doing before Bitcoin came into your life?
After university around 2004 or 2005 I moved to London from Sweden and started trading interest rate derivatives. When my wife got pregnant we moved back to Sweden since she's a GP there. I set up my own trading shop around 2008 and ran that for about four years, reading a lot about markets and monetary systems along the way.
When did you first come across Bitcoin?
I think this was early 2012. I read an article by Richard Falkvinge about the Pirate Bay case and the Supreme Court not hearing the appeal, and there was a banner with the Bitcoin logo saying digital cash. I started reading up on it and went down the rabbit hole from there.
Back then, if you held bitcoin, how would you actually store it?
This was back when Mike Hearn wrote BitcoinJ. There were online wallets like blockchain.info, but since those were custodial we didn't use them. We had really three choices: Bitcoin Core, Armory, or Electrum. Armory added functionality Core didn't offer out of the box, like backup seeds, lockboxes, watch only wallets, and offline signing.
How did BlockSettle come about after Armory folded?
Armory's company ran out of funding because the institutional space hadn't really gotten into bitcoin yet. Coming out of a failed Swedish exchange project, I reconnected with Armory's lead system architect and a third person, Albert, and we set out to build BlockSettle around 2016. We were too optimistic on timelines, expecting 18 to 24 months, and it's taken roughly double that.
How would you describe BlockSettle to someone new, like your parents?
BlockSettle's wallet is built on all the latest Armory code, which has been in stealth development this whole time. It's a comprehensive non-custodial wallet with trading built in. We custody the cash side only, while the bitcoin moves directly from buyer to seller, so you never have to trust an exchange with your coins.
How is BlockSettle different from centralized exchanges or peer to peer models like LocalBitcoins?
Centralized exchanges custody both your cash and bitcoin to guarantee settlement, which creates fraud risk. Peer to peer multisig models are decentralized but have poor liquidity and can trigger bank scrutiny from repeated large transfers. We built a hybrid third model where we only custody the cash, while bitcoin goes directly from buyer to seller.
How does price and matching actually work if there's no order book?
It's a request for quote model like the FX market rather than an order book. You send an RFQ into the market and anyone can respond during a 30 second competitive bidding period. At the end, you're matched with whoever gave the best responsive quote, similar to multi dealer FX platforms where any bank, or here anyone with settlement access, can act as a dealer.
Beyond spot trading, what else has BlockSettle built?
We've also developed the ability to tokenize securities that can be traded against bitcoin using coinjoin transactions. This gives you delivery versus payment happening directly on chain between the buyer and seller, using the bitcoin blockchain itself as the settlement layer for both the security and the payment.
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