0:00 Hello, and welcome to Drivechain Talk, Twitter Space. 0:04 This is May 1st, and we are excited to have another chat about Drivechain today. 0:12 I'm Henry at LayerTwo Labs, and everyone in the audience is welcome to come on up 0:17 and ask any questions you might have about Drivechain, 0:23 chat about the prospect of sidechains revolutionizing Bitcoin development 0:29 and strengthening Bitcoin's potential for value accrual 0:34 and blocks-based value accrual in the future. 0:41 Drivechain is an idea whose time has come. 0:45 Eight years into the development of this project, 0:49 we are now at a moment where there's a lot of attention on it. 0:53 We have prominent support from such Bitcoin thought leaders as Adam Back and Fiatjaf, 1:00 Mike Tidwell, and many others who are Drivechain fans, some of them Drivechain fanatics. 1:09 Many people are very excited about how sidechains can fulfill the promise of Bitcoin 1:15 to serve as a platform for a variety of technology that is permissionless and peer-to-peer, 1:23 such as oracles, large blocks, strong fungibility, DNS, and other technology. 1:35 All of those technologies can be built on Bitcoin instead of built on altcoins. 1:41 Right now, Bitcoin doesn't offer those technologies in a peer-to-peer format, 1:46 but with Drivechain, those technologies would be available in a peer-to-peer format. 1:58 Right now, Drivechain is existing as a testnet and existing as a movement 2:06 which has a Bitcoin improvement proposal, two of them, in fact, ready for consideration by the community. 2:17 An effort is underway with an expert in the community to rebase both of the BIPs, 2:24 bringing them up to readiness, full readiness for consideration by the community in terms of merging them into the code. 2:34 It's a very exciting time to be interested in Drivechain. 2:39 Sidechains have been contemplated by Bitcoin thinkers for quite a while. 2:43 There is an excellent paper by Blockstream in 2014 on sidechains, 2:51 and then they also have another excellent paper a few years later about Liquid specifically. 2:59 Sidechains have their roots, I would say, in the 2010 writings of Satoshi 3:07 when he thought about merged-mined altcoins, which, of course, aren't sidechains but altcoins. 3:12 He thought about BitDNS serving as a DNS on blockchain, merged-mined with Bitcoin. 3:23 So at the very beginnings of Bitcoin, back in 2010, Satoshi himself contemplated the possibility of a multitude of blockchains built on Bitcoin. 3:35 And, of course, a merged-mined altcoin isn't as exciting as a merged-mined sidechain 3:41 because the sidechain accrues value to Bitcoin mainchain, 3:46 whereas the merged-mined altcoin merely accrues value to Bitcoin's block space. 3:53 There are two goods in the Bitcoin network, 3:55 and the goal of sidechains, specifically of the Drivechain variety, 3:59 is to boost the value of not only the Bitcoin block space but also the Bitcoin token. 4:09 What we want is for all of the value accrued on the sidechain, 4:13 all of the value proposition and network effect of the sidechain, 4:17 to be harmonious and symbiotic with the economics of the mainchain, 4:23 such that each of these Bitcoin sidechains is a force for good in terms of bringing more people to Bitcoin, 4:32 bringing more value to Bitcoin. 4:41 If anyone in the audience would like to come on up and raise their hand and ask a question, you're welcome to. 4:51 Feel free to join the stage and share your question if you'd like. 5:01 In the meantime, let's put up some food for thought in the nest. 5:09 Let's get some interesting tweets up in the nest for conversation. 5:19 The first thing in the nest is the badge. 5:22 The badge of Drivechain. There it is, PIP-303-01. 5:50 All right. 5:55 Everyone's welcome to come on up to the stage and ask a question. Don't be shy. 6:00 If you're in the audience and you have a question, you can, in your app, select to raise your hand. 6:10 And then you can join the stage and ask your question. 6:40 Welcome. Welcome, everyone, to the audience. 6:48 Please do feel free to raise your hand and come on up to the stage if you'd like to discuss Drivechain. 7:01 It would be great to have anyone come on up and ask a question or share a comment about it. 7:10 So feel free to raise your hand and come on up to the stage to chat about BIP300 and BIP301. 7:40 Thank you. 8:10 Thank you. 8:40 Thank you. 8:50 So who has a question or comment about Drivechain? 8:53 Don't be shy. Come on up and let's chat about it. 8:59 Drivechain is a very powerful idea. 9:02 What it would do is provide strengthened facilities for Bitcoin sidechains. 9:07 Right now, every Bitcoin sidechain is federated. 9:10 A federated sidechain involves control of the Bitcoin held in the sidechain by a group of people, 15 people. 9:19 Whereas in a Drivechain format, it's the miners who participate in the security model of that Bitcoin held in a hash rate escrow. 9:29 So instead of a federated sidechain being the only format for sidechains, if Drivechain is adopted, then we have a new model available. 9:37 And it's opt-in. No one has to use it. 9:40 So it's all optional. 9:42 But if it's introduced, then I think a lot of people will use it and it'll help Bitcoin grow enormously. 9:59 Thank you. 10:29 Thank you. 10:59 Thank you. 11:29 Thank you. 11:59 Thank you. 12:29 Thank you. 12:59 Thank you. 13:29 Thank you. 13:59 Thank you. 14:29 Thank you. 14:59 Thank you. 15:29 Thank you. 15:59 Thank you. 16:29 Thank you. 17:37 Thank you. 18:08 Thank you. 18:09 Thank you. 24:24 Hello, and welcome to Drivechain Duh. 30:21 Welcome, everyone, to Drivechain Twitter Spaces. 30:26 If you have a question or comment or want to chat, come on up. 32:48 Usually we have a larger crowd today, it's pretty quiet. 32:52 If anyone has any questions about Drivechain or would like to come up and chat, do. 32:58 Hello, MoonSettler. 33:03 Come on up if you'd like to chat about our favorite 33:08 topic. 34:16 Welcome, Raybon. Go for it. 34:21 What should I go for? 34:24 You could share a comment or question about Drivechain if you'd like. 34:35 I don't know enough about it, honestly. 34:41 That's alright. 34:43 Not a people do, even though it's been talked about within Bitcoin's 34:49 community for about 8 years, 34:51 only recently has it gotten more attention. 34:55 Are you familiar with idea of sidechains or merged mining? 35:00 Yeah, I'm a current participant and so is it anything similar to like the way 35:06 a full payout per share pool works? 35:10 a nice 35:11 or LinCoin, it something like that? 35:16 I would have to just look those up for a minute, but NiceHash is where you rent 35:20 hashing, correct? From like a centralized company? 35:24 Yeah, it's like a marketplace, totally. 35:26 So I think this wouldn't be that, because that's 35:33 Drivechain is a proposal for a soft fork that would introduce a new 35:39 option for the way things can be done. 35:41 currently, NiceHash is up and running and is centralized, whereas Drivechain is an 35:47 effort to make sidechains of Bitcoin not federated. 35:51 So currently, I'm sure you've heard of like Liquid and RSK. 35:55 Those are the two largest sidechains on Bitcoin. 35:59 They're not that large right now. 36:01 They're like 50 or 70 million dollars each in terms of like the market cap of the 36:06 Bitcoin that's been sent to those sidechains. 36:08 What is the name of that one you just mentioned? 36:14 The other one's called Rootstock. 36:18 Okay, I've heard of too. 36:20 wasn't sure. Yeah, I mean, they're not that big. 36:23 They aren't like billions the way, for example, wrapped Bitcoin is like four 36:29 billion dollars 36:30 value. People have often heard of wrapped Bitcoin, but Liquid, which is by Blockstream 36:35 and RSK, which is Rootstock, 36:38 those two sidechains are not that big. 36:41 So Drivechain is an idea which might make sidechains much bigger on 36:47 Bitcoin. So it's possible that 36:50 if the Drivechain BIPs are adopted, like the, know, SegWit was adopted in 2017, 36:56 Taproot was adopted in 2021, Drivechain is an idea which could be adopted 37:01 in like 2024, for example, hypothetically. 37:06 And if it were, then we might 37:10 start to see a lot more value in these Bitcoin 37:16 sidechains. instead of Liquid and RSK being rather small, Liquid and RSK and other 37:22 sidechains might grow much larger because the Drivechain architecture 37:27 is designed 37:29 to sidechains, to make sidechains more peer -to -peer rather than federated. 37:35 Currently, every Bitcoin sidechain uses a federation. 37:39 And Drivechain is different. 37:41 is, to quote Adam back, more peer -to -peer. 37:44 It's an approach to side change that's more peer -to -peer because 37:49 instead of a 15 -person multi -sig controlling Bitcoin, that has been sent to the 37:55 sidechain. 37:57 Drivechain uses something called Hashrate escrow which is BIP300 and the 38:03 miners play an important role in that. 38:06 The goal here is to make sidechains more 38:09 like Bitcoin and that they're peer -to -peer rather than having a trusted third party, 38:13 which is how we could describe the federations that currently control the Bitcoin 38:19 in various sidechains today. 38:23 So the places that people can learn more about Drivechain include the Telegram group, 38:27 which has 700 members, 38:30 drivechain.info website, there's also videos online. 38:36 Some of the applications that Drivechain would bring to Bitcoiners include more 38:41 privacy, so you could have a sidechain that's focused on very strong privacy, and you 38:47 can also have a sidechain focused 38:52 Large blocks? Hold on, hold on. 38:55 What do you mean by large blocks? 38:57 that's exactly the right reaction people sometimes have because people think, wait, 39:02 what's the reason to have large blocks anywhere? 39:08 Wasn't 39:08 think like weren't large blocks something that were, you know, considered and rejected 39:14 in Bitcoin's history? 39:17 it turns out, and Adam back, you know, tweets about this. 39:22 So, not just him, but many other people think that it would be good to have people be 39:27 able to opt 39:28 in to large blocks purely optional. 39:32 So if you want to do a lot of transactions that are maybe smaller value like buying 39:37 coffee, then you want to have a fee that's low and lightning 39:43 is great for smaller value, higher frequency, low fee 39:48 payments, but large blocks is another way of doing it that has a different set of 39:53 features and advantages and it would be a good complement to Lightning. 39:58 If you wanted to onboard billions of people to Lightning, it would take decades because 40:03 there's only so many channel opening transactions that can be done in every 40:08 block. every Bitcoin block can only hold so many 40:14 transactions. So if you had the whole world onboarded to Lightning, it would take 40:19 like 40 years to onboard like 8 billion people. 40:24 So if we want to have Bitcoin be used by the 40:28 whole world and not have everyone cut in third -party custody at Coinbase, 40:35 a lower decentralization. 40:38 Do you think Cuckbase? 40:40 Sorry, Cuckbase? Yeah. 40:43 Yeah, so if the goal is to avoid things like Coinbase and embrace peer -to -peer, 40:48 then a large block sidechain is exactly one good path to do it. 40:53 that's what Adam back recently tweeted. 40:55 I'll just find the tweet and share it in a blatant appeal. 40:58 Damn, got Adam on your side now, Henry. 41:00 That's good. Fuck yeah. 41:01 a blatant appeal to authority, I'll just find his tweet and share it. 41:07 have to scroll a bit to find it. 41:14 as I do that, there are a bunch of, this is like the essence of Drivechain, that there 41:19 are a bunch of cool technologies that currently aren't possible to build on Bitcoin in 41:23 a peer -to -peer manner. 41:26 And Drivechain would 41:27 enable those technologies to be built on Bitcoin, specifically on Bitcoin's sidechains, 41:32 are completely optional. 41:34 No one has to use it. 41:35 It's like Lightning. 41:36 No one has to use Lightning. 41:38 You can just do main chain Bitcoin. 41:42 In the far future, Bitcoin is extremely successful, the fees 41:47 will be pretty high on MainChain. 41:50 People also will want to do applications that are not possible 41:54 on example, MainChain has 42:00 small blocks. If you wanted to use a large block version of Bitcoin, could use a 42:06 sidechain that 42:07 has that larger block size. 42:09 So it would be a clone of Bitcoin, except it has a larger block size, enabling lower 42:13 fees, higher throughput, but it's still peer -to -peer. 42:17 It's not reliant on some centralized third party. 42:23 there would be, if Drivechain's adopted, we'll 42:27 is a sidechain for privacy that uses the technology from zcash a sidechain for 42:33 smart contracts that uses the technology from ethereum and a sidechain 42:39 for large blocks kind of like bitcoin cash or bsv just large block version what is the 42:44 tech of ethereum that makes it stand out 42:46 to you? when I look at it, just see, like, I don't see a breakthrough. 42:51 I don't see a technology. 42:52 I just see, like, a company with, like, a product, you know? 42:56 Yeah. So some of the technology that might be, 43:02 so the question kind of gets to, like, is blockchain for only 43:06 payments or are there things beyond payments that can be done on blockchain and should 43:11 be done on blockchain that's one way of putting your question and think that 43:16 there are applications other than just payments so for example even 43:22 payments itself like money on blockchain and people say 43:26 Bitcoin not blockchain, know, there's there's even variations within the money category 43:31 like more private money or more scalable money. 43:35 larger blocks or more privacy, more fungibility, right? 43:39 So if you wanted to have on blockchain, a extremely private 43:44 way 43:46 of sending money around, you would want use the technology from these privacy altcoins. 43:51 But the problem with those altcoins is that they have a token that is like money 43:56 printing. So the whole goal of Drivechain is to eliminate all of the money 44:02 printing of altcoins, but enable Bitcoin 44:10 So, 44:12 there's a tweet from Adam Back where he said, am an innovation maximalist, but I'm 44:18 an altcoin senior age critic. 44:21 So, he wants the technology of the altcoins without the money printing, and that's what 44:25 Drivechain 44:25 Chain is about. 44:27 It's that basically, instead of saying that altcoins are all worthless, what we want to 44:32 do is bring the technology of the good ones. 44:35 There's a few good ones for, as I mentioned, privacy, large blocks, also peer -to 44:41 oracles. All of those technologies and DNS, that's 44:45 himself talked about back in August 2010. 44:48 He wrote in of DNS on blockchain. 44:53 the idea that blockchains only for payments is not quite right. 44:58 And instead it would be good for Bitcoin to be able to have these peer to peer side 45:03 chains that have these interesting and potentially 45:05 very valuable technologies, eliminating all of the altcoin money printing. 45:11 So actually, Drivechain is an idea which is directly attacking altcoins 45:17 in the sense that, like, you're like me and you think it'd be 45:23 great just to have Bitcoin's 45:25 monetary policy be the monetary policy of the whole world. 45:29 If that's what you want to happen, want to see happen. 45:32 If you want see that happen, Drivechain. 45:34 That's what I want to happen. 45:35 Yeah, that's what Drivechain is designed to help make happen because it's all about 45:40 eliminating all of the altcoin money printing, but at the same time enabling their 45:45 technology to be built on Bitcoin. 45:47 Could it embolden them to continue on their own test? 45:51 Because they're doing it, the big boss is doing it, like, and I do it too. 45:56 I mean, that's just conjecture, but you know what I'm You mean like when they say that 46:00 Bitcoin is the big boss and Bitcoin got value, so they want to have their own? 46:05 Is that what you meant? 46:06 Yeah, if you bring some of these things to Bitcoin, doesn't it sort of validate their 46:11 efforts in a way? 46:13 Yeah, that's what Jimmy Song said to me in a conversation about a year ago on Twitter 46:17 Spaces. He's like, I used to be in favor of Drivechain, but now I'm not because I think 46:23 it would validate altcoins. 46:24 altcoins. See, I see it the opposite way, do the Drivechain. 46:28 See, I was kind of thinking that too, it's a two at double edge. 46:32 either emboldens some folks, but for the most part, it would make people just abandon 46:37 their shitcoin. I can see why that would happen too. 46:41 So I think that if 46:44 Bitcoiners were to drop this mantra that there's no good technology outside of Bitcoin 46:50 and instead tweak their their view with to have the drivechain view which is that 46:55 right now altcoins some of them have good technology but we want to we want to 47:01 eliminate the monetary policy of those altcoins. 47:04 Let's take a look at Bitcoin. 47:06 to zero and have Bitcoin be the only token that's a monetary token. 47:13 In order to do that we have to enable Bitcoin to have a narrative which is that 47:18 everything you want to build on blockchain you can build on Bitcoin and right now that 47:22 narrative doesn't exist 47:24 because if you want to build on Bitcoin smart contracts, privacy technology 47:29 of the kind that Monero or Zcash has or large blocks 47:34 or DNS if you want to build those applications on 47:40 Bitcoin the only way to do it is a federated 47:43 sidechain like Liquid or RSK. 47:47 All of the sidechains right now on Bitcoin are federated, 100 % of them. 47:50 There's no way around it. 47:52 Drivechain aims to fix that, to make these sidechains more peer -to -peer. 47:57 And therefore, the sidechains would potentially, and I can't promise it will happen, 48:01 but potentially have a 48:03 narrative, which is that they're more or less trustless and they're reliable. 48:10 And we could see these drivechains over the course of years grow into the billions of 48:14 dollars of value. 48:15 And what's critical there is that all of that value is going to increase Bitcoin's 48:21 price. And 48:23 also all of the transaction fees on the sidechains are paid to Bitcoin miners so 48:29 drivechain is designed to make Bitcoin more valuable and stronger 48:34 in terms of miner revenue and also Bitcoin token price now you might ask 48:40 well Henry how does like the value 48:43 on the sidechain accrue to Bitcoin's mainchain? 48:46 Well, there's what's called a two -way peg between the sidechain and the mainchain. 48:51 And currently, the Bitcoin sidechains have this, the federated ones. 48:56 They have a two -way peg. 48:57 if you were to go out and buy, let's say, hypothetically, a billion dollars' worth of 49:01 liquid Bitcoin, which is the native token 49:03 of the liquid network sidechain. 49:05 If you were buy a billion dollars worth of it, all that demand that you're creating for 49:10 the liquid token would actually increase Bitcoin's price because there's a two -way peg 49:16 between liquid Bitcoin and Bitcoin on the main chain, like actual Bitcoin. 49:21 And that two -way peg means 49:22 that if there's demand for the sidechain token, that increases the value of the main 49:27 chain token. 49:29 Does that that make sense? 49:34 I know that was a lot of work. 49:35 think so. And I think I get what you're saying, most to the most part, what I'm 49:40 concerned with is like, 49:43 I think would probably, it's like a, it's a vague sort of concern because I don't 49:47 really know, but like LayerTwo Labs, like that's, that's your, you're employed by them, 49:52 right? Yeah. they're the ones, are they the ones that the only group trying to 49:56 implement the BIPs for Drivechain? 49:59 Well, mean, other people talk about it 50:02 who aren't in LayerTwo Labs like Fiatjaf, creator of Noster. 50:06 He's a... Drivechain more like an overall term for the that avenue 50:12 of trying to create a peer -to -peer version of like the like what Liquid does? 50:19 mean, LayerTwo Labs is only one year old. 50:21 Drivechains is eight years 50:22 old. 50:24 Yeah, I didn't really know that. 50:25 didn't know. No problem. 50:27 Almost no one's heard of LayerTwo Labs, 50:31 but it only has five employees. 50:35 That's what I was going to ask. 50:36 many employees? it's got five people? 50:39 Yeah, five employees. 50:40 would say most of the Drivechain 50:42 supporters don't have anything to do with LayerTwo Labs because it's like small kind of 50:46 niche company. Drivechain, I would say, is the property of the whole Bitcoin community. 50:52 The fact that... 50:53 I don't know, that's...when I hear that, scares me. 50:56 Because I'm like, is it? 50:58 It's like Taproot or SegWit. 50:59 It's an idea, part of the source 51:02 development community. mean the Bips are listed on the Bitcoin GitHub and you 51:08 know the maintainers or Luke or someone added the drivechain Bips to the GitHub for 51:12 Bitcoin. So everyone in the world can see all of the code and the explanation 51:18 for these Bips for for the consideration 51:21 of the community it's like SegWit taproot BIP 119 any of 51:27 these Proposals that had you know, some of which have been accepted some of which have 51:31 been rejected others are just out there in Consideration and I would say drivechain is 51:36 in that number 39 51:40 BIP 39 51:42 It's a good one, right? 51:45 I mean, they're all very interesting. 51:50 I really like BIP39. 51:52 think it's a good one too, Raybo. 51:55 Welcome to the stage. 51:58 yeah, mean the purpose of 52:01 these spaces, have them every Monday and Thursday, is just to chat about Drivechain and 52:06 answer questions, share comments. 52:09 Sometimes we have critics, we have supporters, sometimes we just have people who want 52:13 to... Yeah, dude, what's the number one critic? 52:16 What's overarching, when people have a problem with Drivechain or 52:21 or they don't like it, I don't really feel either one way or the other because I don't 52:25 fully understand it. 52:28 What is the crux of the issue to you? 52:31 Why has it been so long that there hasn't been a that passed? 52:37 Or has there been any to do with it? 52:40 no 52:41 there has never been any Drivechain BIPs that have been adopted. 52:44 There are two BIPs. 52:45 It's BIP300 and 301. 52:47 Those two BIPs. 52:48 The first one is the two -way peg that's peer -to -peer called Hashrate Escrow. 52:52 BIP301 is secondary and less important, but they're both designed to work together. 52:58 The second one is called blind merge mining. 53:07 just an improvement on that, designed by the Drivechain authors. 53:12 what blind merge mining does is enables the Bitcoin miners to receive the transaction 53:17 fees of the sidechains without running the 53:19 sidechain node. blind merge mining lowers the burden and complexity of getting those 53:25 fees for the Bitcoin miners. 53:27 And you asked a great question. 53:30 what's the primary 53:33 by the Drivechain critics with respect to Drivechain? 53:37 the primary objection, if you were to talk to Greg Maxwell or Shinobi 53:43 or Peter Todd or other people 53:48 Jimmy Song. Todd, he the barber in that movie with the Edward Scissorhands kind of 53:53 vibe? 53:54 A Sweeney Todd, bro. 53:58 Yeah, so there are some big names in Bitcoin who don't like Drivechain and some that 54:02 do, know, Fiatjaf 54:05 Drivechain. 54:10 So the critics, it's a great question, what's the criticisms? 54:14 They would point to the influence of Drivechain on the and how the miners have a lot 54:19 power in the drivechain 54:21 ecosystem in their view, and that the miners would have too much power 54:27 and influence, and that there might be force of less 54:33 decentralization. If Drivechain's adopted, in their 54:37 view, large miners could collude to steal money from the hashrate escrow. 54:44 they also think that the burden of running nodes would arise for small miners. 54:50 Even though blind merge mining exists, there would be a profit motive to have 54:54 the nodes running Which would be hard for some small miner to have the nodes of the 54:59 sidechain, especially if they're yeah What are the requirements it like or? 55:03 What's the idea as far as so I didn't realize that part so you'd have to run a node So 55:09 let's say I got Bitcoin core node. 55:17 run the nodes of the sidechain. 55:20 the whole system is designed to be completely optional. 55:23 Like no one has to do anything. 55:25 It's like lightning. 55:26 doesn't have any negative impact on anyone. 55:29 Like lightning doesn't harm 55:48 Bitcoin to the sidechain to use the sidechain, 56:18 the synthetic Bitcoin on the sidechain, which is one -for -one pegged with mainchain 56:24 Bitcoin. That increases the price of Bitcoin. 56:27 It's kind of like this. 56:27 Imagine if Ethereum and Zcash were sidechains of Bitcoin. 56:33 If that were the case, and all of the transaction fees were being paid 56:37 The Bitcoin miners would have much higher revenue, which would mean... 56:41 They probably should have pursued that and they'd be more relevant today. 56:45 Exactly. That is the vision exactly of Drivechain, that it would create like harmony 56:50 and collaboration among all of the altcoin communities, because they would get 56:55 rid of their altcoin they'd come to Bitcoin use Bitcoin sidechains and then we'd all 56:59 be Bitcoiners there would be no like competition for like who has the monetary 57:05 token there'd no like money printing it all be about technology it would be better 57:11 if the entire crypto community were just 57:13 everything were built on Bitcoin. 57:15 just, and we wouldn't be like judging the project so much. 57:19 Like all of this hatred of altcoins, it really might go away if Drivechain's adopted 57:24 and then all of the altcoins just go to zero in theory. 57:27 That's like a fantasy scenario that I think will come true, but it's sort of hard 57:37 just a Bitcoin sidechain. 57:39 of the... the way I see it, really does have 100 % dominance. 57:43 when you think about that, you got, let's say when people say it's a 50 % dominance, if 57:48 I create 10 more tokens, that dominance goes down, but all I did was poof something out 57:52 of the air. 57:54 But I know what you're saying, I agree with 57:58 You know what I mean? 57:59 when people point to Bitcoin dominance, like it's a metric, it's really unfair, or 58:05 it's skewed. Yeah, yeah, it's a complicated topic of market cap 58:11 because, you know, they're stablecoins and also, 58:14 Yeah, it's manipulated like someone can print a trillion tokens and then trade one of 58:19 them for ten dollars and then they claim A ten trillion dollars. 58:24 Look how fast it went. 58:26 Okay, the speed the transactions per second Yeah, god damn. 58:30 They claim a ten trillion dollar 58:32 cap. So part of what it takes though to like really grok Drivechain, part of what it 58:38 takes, and this is hard for a of people, is you've got to understand that there is some 58:44 legitimate valuable technology in some altcoins and 58:49 that it would be better for Bitcoiners and everyone if that technology were copied onto 58:55 a Bitcoin sidechain, which would enable people to use that technology, but also 59:01 have Bitcoin's unit of account. 59:02 So for example, suppose there's another blockchain out there like Zcash or 59:07 Monero. And suppose that it has very strong fungibility guarantees. 59:11 the privacy community, people trading in a regime where the government is 59:17 oppressive and they want strong privacy, which is their right. 59:21 They might use Monero instead of Bitcoin, 59:25 but the problem there is that Monero 59:28 competes for monetary premium against Bitcoin. 59:34 It would be ideal if those people could instead use a Bitcoin sidechain, which doesn't 59:39 compete for monetary premium 59:42 against Bitcoin. They would be transacting in a unit of account that is one Bitcoin 59:46 on this privacy sidechain. 59:49 And then when they're done, they could do the peg out back to the main chain, get 59:53 Bitcoin and be done with the sidechain. 59:56 It's kind of like, it's kind of like, imagine you have gold 59:59 bars and you convert them into gold coins by melting them down and casting them as gold 1:00:04 coins. And then when you're done with the coins, you can get back to bars by just 1:00:09 melting down the coins and then putting them into bars again. 1:00:12 So that's an example of a two -way peg in physical reality. 1:00:17 But on the blockchain, there can be a two -way peg between the sidechain and the main 1:00:21 chain. every sidechain would be another blockchain. 1:00:25 and The idea the holy grail of Bitcoin development since like for the last decade has 1:00:31 been how do we have a sidechain? 1:00:33 Where it's trustless and peer -to -peer 1:00:35 -peer, and you can move value, can move a Bitcoin from the main chain to the sidechain 1:00:40 and then get back. 1:00:42 So, if you've heard about like soft chains and space chains, there have been some 1:00:47 people who are tinkering and exploring with the idea of sidechains trying to keep them 1:00:52 peer -to -peer. 1:00:53 The 1:00:54 hardest part is the peg -out mechanism, which is moving value from the sidechain back to 1:00:58 the mainchain in a manner that's not federated. 1:01:03 that's what Drivechain is designed to achieve, is a 1:01:08 peer -to -peer peg -out mechanism 1:01:12 for Bitcoin sidechains, which currently doesn't exist. 1:01:17 currently, if you use a sidechain like Rootstock or Liquid, when you want to move your 1:01:22 value back to the main chain, when you're finished using the sidechain, you're to be 1:01:27 dealing with a federated 1:01:31 group of persons who are controlling those pegouts. 1:01:34 it's arguably permissioned and not peer -to -peer. 1:01:39 with Drivechain, that architecture is improved. 1:01:44 People have an option to use the Drivechain setup once it's adopted by the community. 1:01:49 and 1:01:49 then the whole idea is to make Bitcoin sidechains a more vibrant and successful part of 1:01:55 the Bitcoin ecosystem. 1:01:57 And it would give Bitcoin a narrative that you can build anything on Bitcoin. 1:02:01 It would give Bitcoin a narrative that it currently doesn't have. 1:02:05 Right now, the altcoins have a certain narrative, 1:02:08 which is, they would say, it's hard to build on Bitcoin or impossible to build on 1:02:13 Bitcoin. So we have to do an altcoin. 1:02:17 So that was actually the rationale of Ethereum. 1:02:21 As you know, the Ethereum white paper, the whole first couple pages are about how it's 1:02:26 hard or impossible to build on Bitcoin. 1:02:30 So that's why they had to do a new altcoin. 1:02:34 And if Drivechain had existed then, then they wouldn't have been able to make that 1:02:39 argument. So Drivechain would deprive Altcoin... 1:02:44 founders of their most valuable narrative, is it's impossible to build on Bitcoin and 1:02:49 therefore we need to build on altcoins. 1:02:52 So I think that 1:02:57 oh, Drivechain would validate altcoins. 1:02:59 Like they already have the 1:03:06 technologies on Bitcoin. 1:03:09 But if Drivechain were adopted, Bitcoin would seize that narrative. 1:03:13 Now, Bitcoin would be able to say, everything you want to build on a blockchain, can 1:03:17 build on Bitcoin, especially on a Bitcoin sidechain. 1:03:21 So drivechain would strengthen 1:03:24 Bitcoin's narratives and I think, like, weaken the altcoins narratives. 1:03:30 And that's the whole idea. 1:03:32 So, if you want to have an extremely strong privacy technology like Zcash, 1:03:37 then you could build it on a Bitcoin sidechain. 1:03:39 And fact, the Drivechain testnet 1:03:41 has a clone of Zcash running. 1:03:46 so the idea is there that you're moving Bitcoin around in an extremely private way 1:03:50 using the technology of Zcash, but you're not using the Zcash altcoin, you're using the 1:03:55 Bitcoin token. So the only way you 1:03:59 people would get tokens on the sidechain is by sending Bitcoin 1:04:04 to the sidechain. 1:04:07 And therefore, the 21 million hard cap is preserved. 1:04:11 Even though Bitcoin is circulating on all these sidechains, there isn't any monetary 1:04:16 issuance. 1:04:34 So every time someone creates like Ethereum or Monero or anything else, they're 1:04:39 printing money to, you know, create their altcoin. 1:04:42 It would be better if they had just created a Bitcoin sidechain. 1:04:46 So Drivechain tends to interest people who have a strong interest in kind of technology 1:04:51 and innovative 1:04:52 stuff like Fiatjaf, the creator of Noster likes drivechain a lot. 1:04:57 So it attracts people who have a strong technology orientation. 1:05:01 Although there are some critics who worry that drivechain would complicate the 1:05:06 economic design of Bitcoin 1:05:09 and they worry that 1:05:11 it places power in the hands of the miners. 1:05:14 So there are some lingering questions and concerns within the Bitcoin community 1:05:20 about Drivechain, and that's why it's been around for so many years. 1:05:25 But I think that its time has yet to come, and maybe in the next 1:05:30 couple of months or years we could see it adopted on Bitcoin and that would be very 1:05:34 interesting. 1:05:38 That's what it's all about. 1:05:45 I welcome you to share any thoughts or 1:05:48 about that. Yeah, I guess for for I think like, if it works, that's, it seems like a 1:06:05 good thing. What is the concern around the miners having too much power because what 1:06:09 they collect more fees, or how would it give them an edge like over what how it already 1:06:14 stands? So the Yeah, that's a great question. The um, the miners would get a lot more fees 1:06:24 from transactions, because let's say there are some very large sidechains on Bitcoin 1:06:31 in the future that are merged mind. So the miners will be getting fees from main chain 1:06:36 transaction fees, and also sidechain transaction fees. And the there's like a complicated theory 1:06:45 that goes like this, that some miners that are very large will want to run the nodes 1:06:51 of the sidechains in order to get even more fees because there could be meth, there could 1:06:56 be like a complicated profitable opportunity from running the node of the sidechain. For 1:07:05 example, you know how there's like meth on Ethereum, there's this issue where like, certain 1:07:10 parties in the Ethereum ecosystem are making more money by like reordering transactions and 1:07:15 other complicated things. Well, if the Bitcoin sidechain, if all of the if all of the 1:07:21 Ethereum were a Bitcoin sidechain, then that meth would be happening just the same way. So 1:07:28 some people are concerned about that. And they want to keep Bitcoin very simple. Like that's 1:07:32 what Peter Todd has said in some YouTubes and spaces I've seen, or maybe just YouTube, I'm not 1:07:38 sure if I've seen him on spaces, but he talks about how he's had some debates with Paul 1:07:43 Sztorc, who is the lead designer of Drivechain. I've seen them talk on one or two YouTubes. And 1:07:48 Peter has said that, you know, Drivechain would complicate Bitcoin and complicate the 1:07:54 economics of mining. So that's, that's one of the concerns about it is that it would make 1:08:00 Bitcoin more complicated. So some people want to have Bitcoin be as simple as possible, just be 1:08:05 about payments, not about, you know, financial, like more complicated financial 1:08:10 transactions. Because if you introduce smart contracts onto a blockchain, then there becomes 1:08:16 the possibility of profit being achieved by a miner who can choose which transactions to include 1:08:24 in a block. Like let's say you and I have a smart contract that says that, you know, if something 1:08:32 happens, if a certain kind of transaction happens before a certain block, then you get paid. But if 1:08:38 it doesn't happen, then I get paid. Well, that would give you the opportunity, you like a 1:08:44 profitable incentive to try to include that transaction before a certain block happens. So 1:08:50 there could be a bet placed on the blockchain, a smart contract, where a miner has a profitable 1:08:56 incentive to include a transaction earlier than later. That's like a very simple kind of example 1:09:04 of the kind of thing I'm talking about, which is that miners might have an incentive to start doing 1:09:10 certain things to make more money. So the critics of drivechain are interested in that kind of 1:09:17 reasoning. But the advocates for drivechain would say that in order for Bitcoin to be successful, it 1:09:27 has to be the platform where anything can be built on blockchain. And that way we bring, you know, all 1:09:32 of the shit coins over to Bitcoin, bring all of their technology, all of their value, all of their 1:09:37 transaction fees, all of their users, make all of those people Bitcoiners. That's the goal of drive 1:09:42 chain is to make the entire crypto community built on Bitcoin. And that way there are no more alt 1:09:50 coins being minted. And Bitcoin would have no competitors, nobody would be worried about the 1:09:58 flippening. And there would be also a ton of transaction fees paid to Bitcoin miners. So nobody 1:10:04 would be worried about the security budget. So there are there are interesting, different 1:10:10 motivations for drivechain. Like a person can like drivechain because they like innovation and 1:10:16 building. That's like the Adam Back approach. Like Adam Back is not worried about the security 1:10:20 budget, but he does like innovation and he likes peer to peer technology. So that's why he's into 1:10:25 drivechain. Like I've read all of his statements and tweets about it. And those are the things he 1:10:31 emphasizes peer to peer and innovation. So he's into drivechain for those reasons. Other people like 1:10:37 drivechain because it would bring more fees. And there other people are worried about the security 1:10:42 budget, which is the idea that the fees could stay low forever. And therefore the miners wouldn't have 1:10:48 enough income. And therefore the cost to attack the network as a 51% miner would fall. So drivechain 1:10:56 could fix that because it would bring fees from all these sidechains to Bitcoin miners and that would 1:11:03 increase their fee revenue. So as the subsidy is halved every four years, if the fees are going up a 1:11:10 lot, then it's okay that the subsidy is being halved. For example, Peter Todd has said he would 1:11:17 like he would support inflation for Bitcoin. So he would support a fork that would introduce 1:11:22 perpetual tail issuance inflation on Bitcoin. So instead of 21 million, he would be okay with like 1:11:29 1% you know, inflation forever. If I'm not I hope I'm not misquoting him. I think he's he's he said he 1:11:37 would support 1% or 0.1% or something, some amount of inflation forever, which a lot of Bitcoiners 1:11:44 wouldn't like and I wouldn't like it. So I would prefer we get more fees rather than keep things 1:11:49 simple, don't have sidechains and then try to do inflation instead. So that security budget problem, 1:11:56 that's like one line of reasoning that has interested some people. In fact, that's what got me 1:12:00 interested originally in drivechain, but I've kind of come around and I found that the most effective way 1:12:06 to talk about it is the way that Adam talks about it, which is not to talk about fees or security 1:12:12 budget instead to talk about innovation and peer to peer technology. Those are like the essences of 1:12:18 drivechain that I think speak to the most number of people in the most effective way. Like even if 1:12:25 there weren't any altcoins, we would still want to do drivechain to enable more peer to peer 1:12:31 innovation on top of Bitcoin. So it's not about drivechain is not just about worrying about altcoins 1:12:38 and worrying about competition. It's it's even if those altcoins didn't exist, we would still want to 1:12:43 build on Bitcoin in a peer to peer manner. 1:12:59 Yeah, so what do you think needs to happen? What are the obstacles until like, what's holding it back from 1:13:04 being approved? I mean, we talked about what what people have against it and stuff, but like, when it 1:13:11 really comes down to it for getting a bit like this activated, like, what's the roadmap look like? You 1:13:19 think it'll you're saying it'll happen sooner than later? Not sooner than later, but in some format in 1:13:24 the future? Like, is there some obstacle that needs to overcome to prove to people it's a good idea? 1:13:31 So the way that Bitcoin development actually happens in terms of consensus soft forks like this is 1:13:38 something which you get, you would get different answers from different people. My understanding, 1:13:42 having read articles about it, and talk to people is that when there's a consensus soft fork proposal, like 1:13:51 SegWit, or Taproot, which are the most recent two major ones, maybe the only major ones, except for 1:13:58 something that may have happened like long ago. You know, there's some debate about which there's some 1:14:02 debate about which changes to Bitcoin were soft forks and which were hard forks. But to keep things 1:14:07 really simple, basically, the big two are SegWit and Taproot. And the way that those happened was that there 1:14:14 was like a sense in the community that most of the Bitcoiners wanted it. And once there's that consent, 1:14:20 there's that sense of things, then people say there's consensus when like, almost everybody likes an idea, 1:14:27 we say that there's consensus. And then the Bitcoin Core maintainers, which are a group of people who are 1:14:35 experts in open source software development, they control, like five, approximately five people have 1:14:43 like access to like the permissions on GitHub to merge code. So BIP300 and 301 are code. And the 1:14:53 maintainers could click to like merge that code into Bitcoin Core. And that would be like the start of 1:15:02 Drivechain being a part of Bitcoin. And then people download nodes, like the new software from the Bitcoin 1:15:10 core. And then they would have that on their node, and then they would, Drivechain would be up and 1:15:15 running. So the answer to your question is, the thing that needs to happen in order for Drivechain to be a part 1:15:23 of Bitcoin is there needs to be widespread support for it in the Bitcoin community. So if everybody were like, 1:15:32 yeah, we want to have sidechains on Bitcoin that are more peer to peer, so we can build on Bitcoin, side 1:15:38 chains and strengthen Bitcoin, and maybe in the process, eliminate altcoins and strengthen the security 1:15:44 budget, like if people were all saying that, then it would happen. And right now, there's some like work being 1:15:53 done to rebase the code. rebasing means making the Drivechain code compatible fully with like the latest 1:16:02 version of Bitcoin Core such that if the community supports it, then the code could be merged into 1:16:08 Bitcoin Core. So the goal of LayerTwo Labs is to like fund the project of rebasing because it's expensive, it 1:16:20 requires like an expert on Bitcoin code to work many hours on the code to make sure that it's like totally 1:16:27 cleaned up and ready. So there's that work being done. And then also like popularizing the idea explaining it. So 1:16:38 it's it's a long it's been a long project, you know, Drivechain wasn't was first introduced in like 2015. And 1:16:46 then now we're eight years in to this conversation. And it's just steadily been growing over time. Some people 1:16:55 would say it's like never gonna happen. For example, recently, Eric Wall went on Peter, Peter McCormack's 1:17:02 podcast, what Bitcoin did. And Eric said, and he's a Drivechain supporter. And he said, it's it's dead. He said it 1:17:09 is dead, like it's not happening. So that and he's a supporter of it. He's been a supporter for years. So some 1:17:19 people think it's never going to happen. But I think it's really cool. And we'll have to wait and see. Probably this 1:17:30 is going to be the year where things come to a head. So either it'll happen this year, or it just really won't go 1:17:37 anywhere. Because now the idea has like funding behind it. So LayerTwo Labs raised $3 million from angel investors 1:17:45 to, you know, promote this idea, and try to build related projects, like build out the sidechains, and make this 1:17:52 happen. So in the coming months, if not a couple of years, whether Drivechain will become part of Bitcoin, or whether 1:18:03 some other idea will come along, like there's Simplicity, which is an upgrade for Bitcoin that has been developed by 1:18:09 Blockstream. So, you know, in the coming years, that will be increasingly talked about as a major change for Bitcoin 1:18:16 potentially. And there's other ideas out there that have been proposed for Bitcoin. Drivechain is just one of them. So 1:18:26 we'll see which idea kind of gets adopted by the community. And there are some people who would say Bitcoin should never 1:18:33 change again. So those people are in favor of ossification. They're in favor of keeping Bitcoin the way it is, and not to 1:18:40 have any more consensus soft fork upgrades, unless a bug appears or unless there's some problem. So some people are in favor 1:18:49 of just keeping things the way they are, and not really changing anything. 1:18:53 I appreciate your questions. They were great questions. So this has been Drivechain Twitter Spaces run by LayerTwo Labs. We meet 1:19:08 every Monday and Thursday at 930am Pacific to chat about Drivechain and discuss the latest ideas. Drivechain is BIP300 and 301. You 1:19:20 can learn more at drivechain.info. There's also videos. If you go to the LayerTwo Labs YouTube channel, there's like dozens of 1:19:32 videos there, mostly of Paul Sztorc giving lectures at Bitcoin conferences. Like he spoke last year with Adam Back on stage at 1:19:40 Bitcoin Amsterdam, and again at Bitcoin Honeybadger, Baltic Honeybadger in Latvia. So last year was a pretty big year, because 1:19:51 Adam spoke two times on stage with Paul about Drivechain and other things. And Fiatjaf is a supporter, Mike Tidwell of 1:20:03 TabConf, which is like the most kind of like hardcore technology focused conference. Well, not the most, but one of them. And Tidwell is 1:20:14 very sophisticated, lightning focused programmer, and he is a big supporter of Drivechain. It has been for years. So some of the most 1:20:22 sophisticated and well respected Bitcoin thinkers and developers like it. But of course, there are some detractors, like I think Greg 1:20:30 Maxwell is like opposed to Drivechain. At least I know that from like an email he wrote publicly in 2017. I'm not sure if he's ever 1:20:37 expressed the public view since then on it. But maybe we'll see this year, something cool could happen. There could be someone who 1:20:46 comes forward, who hasn't really shared a view yet, who who likes it. 1:20:56 Jeff, welcome to the stage. If you have any questions or comments or criticisms or anything you want to say, we have four minutes left. Four 1:21:05 minutes left in our scheduled programming. Usually we talk from like 9.30 to 11. So we're getting ready to wrap up today. But chime in if 1:21:14 you'd like. 1:21:15 Thank you. I really don't have anything intelligent to add. I do. I like the sound of your voice. It's really soothing. And I wasn't 1:21:23 really listening to anything that you were saying most of the time, but just the tonality and the way that your voice flows. And it makes 1:21:30 for like a really zen type of experience. I'm a little stoned right now. So it's a good vibe. I appreciate it. I appreciate you for 1:21:38 that. Thank you. 1:21:40 That's very sweet of you to say. I would like to return the compliment. I think you have a lovely tone of voice. And you also have an 1:21:46 impressive vocabulary. You mentioned tonality and other things. So I find you to have a mellifluous and sophisticated persona on the 1:21:54 internet. And I congratulate you for that. 1:21:58 Are you flirting with me right now? 1:22:00 Well, that would be a betrayal of my, you know, holy matrimony with my wife. So I would, I would say that I'm probably not. But, you 1:22:11 know, I was just making sure. That's okay. 1:22:16 Well, let's see. 1:22:19 I hope that if anyone takes anything away from this conversation, it's that sidechains on Bitcoin are an important topic. And that at some 1:22:29 point in the future, if you're devoted to Bitcoin, if you love Bitcoin, and if you want Bitcoin to succeed, then it behooves you to 1:22:37 understand what is a Bitcoin sidechain? What is the history of this idea of Bitcoin sidechains? And what is merged mining? So those are key 1:22:53 concepts. You don't have to be a drivechain supporter, to know that merged mining is something Satoshi invented. And he specifically said 1:23:01 that all blockchains in the future would be merged mine with Bitcoin. He wrote that in the bit DNS thread. So Satoshi had a view that 1:23:11 everything will be built on Bitcoin to some extent. And I think that drivechain might fulfill that vision and eliminate all of the 1:23:19 competition from altcoins and enable Bitcoin holders to hold their token for 100 years and retain value and grow their value without having to 1:23:28 worry about pivoting to some other blockchain. So the goal is to make Bitcoin the strongest possible, widest and most successful 1:23:38 system. And also, like, in my sort of studies of drivechain, I found that it becomes apparent when you think about it enough, and you read 1:23:47 enough about it that, like the blockchain that achieves a design similar to drivechain is the one that's going to in the very far future be 1:23:57 the one and only blockchain base layer. So we want that to be Bitcoin, we want Bitcoin to be the base layer to all the other applications out 1:24:06 there that are on blockchain. And if Bitcoin were to maintain a simple, narrow mandate of only doing payments of a certain kind, plus lightning, I 1:24:16 think that technological platform wouldn't be expansive enough. And a different blockchain would grow and accrue value and compete with 1:24:26 Bitcoin. So mainly Ethereum. So the goal here is before Ethereum ossifies its main chain, it would be good for Bitcoin to develop its side 1:24:35 chains fully. And therefore it would, it would probably absorb all of the value from Ethereum. And Bitcoin would then be left as the sole, you 1:24:44 know, layer one that's standing. In fact, the drivechain, you know, testnet includes a clone of Ethereum and Zcash. So those were the two that 1:24:54 the developers chose to start with. So they've cloned those blockchains into Bitcoin sidechains. And then that would enable all of the users 1:25:03 to move over and use Bitcoin. There's a lot of demand, there is a lot of demand to do smart contracting with Bitcoin. That's why $4 billion has 1:25:12 been sent into BitGo's wrapped Bitcoin product. People want to use Bitcoin in a smart contracting blockchain. So it's unfortunate that 1:25:23 everyone's using the wrapped Bitcoin product because it's totally centralized. A single company, BitGo, as I understand, is more or less in 1:25:32 control of that $4 billion of value of actual Bitcoin. So it'd be good if instead that were peer to peer and, you know, more trustless. So 1:25:47 that's the whole story. Well, it's 11 o'clock now. Let's pick up this conversation on Thursday. You're all you all are welcome back. It was 1:25:59 awesome to have you here. Thanks for the very good questions, Raybon and Jeff. Catch you next time on Thursday. Drivechain Twitter spaces 1:26:08 every Monday and Thursday. We chat about BIP300 and 301, sidechains, merged mining, innovation. That's what it's all about. I hope to see you 1:26:18 all again on Thursday.
