0:00 Hello and welcome to Offchain Live. Today I have a very special guest, Paul Sztorc, 0:06 and we're going to talk about Drivechains. Paul, you want to say hi? 0:09 Hello everyone. 0:11 Yeah, so I mean this is something that I don't know how familiar my viewers might be with 0:19 Drivechains, so let's just start right off with that. What is Drivechains exactly and what is it 0:27 going to solve? 0:28 Yeah, it's kind of like, it's like that book, also Sprach Zarathustra, which is like, 0:33 it's like a book for everyone and no one or something, where it's kind of like, 0:38 sidechains are kind of a big idea. So there are a lot of ways of explaining what they are and sort 0:45 of what they do. Like sometimes I give an analogy of like a stop sign, like you could describe what 0:49 a stop sign is, that it has eight sides and then it's red, but that's not really like the same 0:54 thing as describing what it does. But sidechains, I would describe in the broadest strokes as just 1:00 kind of trying to improve something about blockchains. So with a blockchain, everyone 1:07 needs to have perfect consensus down to the last byte and as a result, everyone is kind of marching 1:13 forward and since everyone has to be together, the whole group can only go as slow as the slowest 1:22 person. And since everyone has already agreed on where they're marching and how fast, quickly 1:29 they're marching, it's very difficult to make any changes. So you have this contradiction where on 1:34 one hand, software has this kind of permissionless innovation, break everything, you know, move fast 1:40 to break things like Silicon Valley, creative destruction. You have all this feel for 1:48 this kind of this way of life almost on GitHub where you fork a project and you try to 1:53 improve it and you have all these competing versions of Linux and all these other things. But on the 1:58 other hand, the blockchain just rigidly enforces total conformity. So what sidechains are is basically 2:03 they let you have all these different pieces of software that are totally different, they're 2:08 totally autonomous, but they can share, you can try to pick a few features that they share and the trick 2:15 is to of course have them share the same 21 million coin limit and have only valid transactions 2:21 going in and out. So another way of expressing that, maybe shorter, is to just say that it lets 2:27 Bitcoin pretend to be Ethereum for, you know, the individual Bitcoins themselves. They can go over 2:33 to a different place and pretend to be Ethereum for a while and then they can stop pretending to 2:38 be Ethereum and they can come back. So that's sort of the key, isn't it? It's that you 2:44 have the 21 million Bitcoin limit and that limit is still preserved in the sidechains. Can you 2:52 talk about that a little more? How do you make sure that no new coins are created or sort of 2:59 messed with? Yeah, so what you want, a sidechain is very similar to an altcoin, so they're 3:08 almost exactly the same except for that one fact that they share the same amount of coins and it's 3:15 actually quite manageable for most of the project to achieve that because all you do is edit the 3:22 altcoin so that it doesn't create any coins by itself. So it starts with zero coins and it doesn't 3:28 create any coins and then you make it so that only when someone does something with their Bitcoin 3:33 wallet, you know, sending the coins into the sidechain, does it credit people on the sidechain 3:42 with new coins and then you just wait for someone to destroy the coins on the altcoin and then you 3:47 have to bring the unlock those coins on Bitcoin. So maybe that wasn't a great explanation but 3:52 the essence is that I think one easy way of thinking about sidechains is that they're very, 3:57 very similar to altcoins but they have this extra accounting built in and a lot of that accounting 4:02 is very easy. So starting with zero and ending with zero is very easy. 4:08 Crediting the user with coins only when their Bitcoin, when they do something special with 4:15 their Bitcoin, user does something with their Bitcoin and then they show it to the sidechain, 4:19 the sidechain gives them credit for that, for depositing those coins into the sidechain. So that 4:25 part, most of it's very easy. There's only one part that's really difficult which is what do you do 4:30 when you have the sidechain coins, those on this, basically this other piece of software. 4:36 That software has to do something to effectively destroy those coins. When you click withdraw 4:42 on the sidechain, it's going to produce something that somehow has to unlock the coins on the 4:48 Bitcoin network. That is the difficult part but everything else is quite easy. 4:53 Right, right. So transferring coins from Bitcoin to the sidechain isn't very hard. Sort of managing 4:59 it within the sidechain isn't very hard and managing it within Bitcoin is already sort of 5:03 done for you with transactions. But getting it from the sidechain to the Bitcoin chain, that 5:10 seems to be the hard part that pretty much every sidechain implementation has sort of struggled 5:16 with. What's Drivechain's approach? What are you doing? I think we can talk about that but first, 5:22 I'm happy to talk about that but let's just I think give people a little bit of a taste of like 5:27 so there is of what is possible if someone succeeds in doing this as I suggest. Maybe I 5:34 have the best idea that is possible. Maybe it's not good enough. Maybe there might be some 5:39 fundamental limitation or something that stops this idea from working and stops all related 5:43 ideas from working. But the benefit is that Bitcoin has this ability to reclaim the 5:51 permissionless innovation concept where you can just have two or three people and they can try 5:56 any idea that they want. It can be larger blocks. It can be ring signatures. It can be like Monero. 6:03 It can be like Zcash. It can be like a Namecoin. It can be a bit message. Doesn't technically 6:09 require but you could have something like that where so anyone or it could be any new idea that 6:15 no one has thought of yet. So you can do any kind of weird thing. Rootstock guys are doing Ethereum. 6:21 I think what I really argue a lot in Drivechain is that it's worth trying because the benefits 6:28 are so so large. It really solves basically every problem because well we can get into that but 6:36 it does mostly solve the problem of people who are angry at each other and fight spending a lot 6:41 of time fighting because now they're all free to do their own thing and the key issue is that these 6:46 are all separate pieces of software and they are separate computer networks. So they are as 6:52 autonomous as altcoins and they are people are free to do whatever they want with them. So that's 6:57 like kind of the pitch that's like kind of the hook that. Yeah yeah for me that that was the 7:02 most interesting thing about the whole Drivechains concept or sidechains in general is that 7:07 you could put whatever feature you want on the sidechain as long as you you can sort of get 7:12 it back and forth between the main chain and the sidechain. And you know you can almost all the 7:18 innovations in every altcoin you could probably do in a sidechain and all the future sort of 7:25 are thinking about like Mimblewimble for example or like Zcash or whatever. Any of those things 7:32 can essentially be sort of branches off of Bitcoin and you can you can sort of you know 7:38 bring all those tech technologies to Bitcoin and just make it work. And that to 7:45 me was the really exciting part and I remember during the scaling debate one of the things that 7:50 you proposed was hey why don't we just have one sidechain for SegWit, one sidechain for 7:56 BigBlocks and then we'd be done with the debate. That was a really great idea and it was 8:02 very unfortunate that that didn't get more traction. Why do you think that that didn't 8:08 like sort of go forward? Because that seems like such a great way to like resolve this. 8:12 Yeah that's a great point. So like for those people who aren't familiar, I mean SegWit is 8:18 great. The idea of SegWit is great and the implementation is like a tour de force of just 8:22 like very careful computer science but it did change just about everything about Bitcoin. 8:31 It changes so many things. I was describing to a friend I was like it's like someone has like a 8:38 disease or something and instead of giving them better nutrition or giving them like a shot or 8:43 something, you change their genetic code around so that they become Siamese twins and then there's 8:49 like there's like two of them. They have like the same head but they have two different bodies and 8:53 then the second body is like has a different thing and then you have all this stuff so that they can 8:59 share blood and everything and I was like yeah it's really messed up. But yeah it's like a weekend 9:03 project to just do segregated witness if you don't need it to be a soft fork which all the 9:10 sidechains are basically hard forks because they're pseudo hard forks. It's a soft fork 9:16 literally in Bitcoin but you have the flexibility to do whatever you like on the sidechain including 9:20 just screw it, blow it up completely. So there you just change the signature, you know the thing 9:27 that generates the transaction ID so that it doesn't cover any malleable fields and you're 9:30 finished. But that we still it's interesting because people want a special version of lightning 9:35 so you probably still have to do that on the main chain and so that would still be you still have to 9:40 go through that giant slog but yeah I don't know the idea of why didn't that idea, the idea of 9:46 just the scaling sidechain get more attraction is a very interesting question. You know it's 9:55 hard to answer because I think it was the best idea and I think it was maybe just 10:02 and it's almost just too good I think it sounds crazy to say but I think you know you know how it 10:07 was at the time I don't know if you were in Milan but there was like I don't remember if you were I 10:12 don't think you were. I wasn't in Milan. But you know like there's a lot of tension there's a lot 10:16 of unhappiness people were walking out the first day there was these kind of like you know I just 10:25 think people kind of had themselves in their little camps and the other thing is it wasn't really it 10:30 was just kind of an idea no one really likes the ideas guy right even though they kind of should 10:35 and in blockchain in generally and you know in Bitcoin they should like the ideas guy because 10:42 you have to normally the ideas guy has no value add but in this case you have something where 10:52 the software has to be right for like a hundred years and you know or whatever and it's going to 10:58 be correct for a long long time and you don't really get a you know the stakes are kind of 11:03 high for screwing it up so you really shouldn't the ideas guy should get more respect but I guess 11:07 I was only merely the ideas guy in the there was well I mean you also made an implementation 11:14 like it's it was mostly ready well you know how software is it's like you're mostly ready but 11:20 not quite you know it's always it's like you get to like 90 percent and then the last 10 percent 11:24 says 500 years or something so and so that was kind of but yeah I don't know um well I mean 11:32 do you think that like time to market was like a major factor because uh there was this sort of 11:39 almost an artificial sense of urgency around the scaling debate that 11:44 or like well we need to get it done now and you know we can't wait for you know better solutions 11:49 and I don't know it seemed like people that looked at Drivechains thought that it was a 11:56 superior technical solution it's just that they thought it would settle I mean I'll settle for 12:01 like worth trying because that's kind of a difference in my point of view is like you know 12:06 like kind of like a cost benefit like is this where I mean I guess Milan people were really 12:12 SegWit still wasn't finished because remember there was the hackathon right afterwards to kind 12:16 of ship it and then that would immediately transition to the drama over SegWit activation 12:21 because people left Milan to go block to go run Bitcoin Unlimited and block SegWit activation so 12:28 that was the start of that whole slog um and yeah I don't know I mean I think it's a really good 12:35 question uh there are you know people were excited about SegWit and they were then excited 12:40 about Schnorr and I think people like there's a I'm going to suggest that there's a bias towards 12:46 these things that are kind of more uh cryptography based and kind of equation based and people just 12:53 like that's very safe and it kind of was becoming a design by committee at that point and people 12:59 like sort of safe things and this is much more of a this is much more of like a kind of a crazy 13:05 chance like if if we did create a large block sidechain there would be new aspects to the 13:10 Bitcoin experiment if you were on it so they would you would have to start telling people again 13:15 you have to start telling them well this is an experimental piece of technology we don't know 13:20 what could happen there could be a bug there could be a whatever there you know uh and so 13:26 that was an idea I mean I was also getting feedback at Milan and people were saying that 13:32 I should address this super obscure minor centralization vague point that uh so I was 13:39 interested in doing that and I did work on that as part of the peer review process kind of I kind 13:45 of regret that though because I think it delayed I think it wasn't worth the delay because just 13:49 think of all the damage that has been done in the last couple of months and now we have a terrible 13:55 situation where we have um the uh the Bitcoin cash uh spinoff and so now we have people who are 14:03 actually selling one coin and going to the other and now those people it's the camps are getting 14:08 even further and further entrenched which kind of makes a it's I guess it's like running third party 14:13 right like you have the best ideas and but you have no people don't want the best ideas they want 14:18 their party to win and I think that unfortunately some of that has uh seeped in I think it's clear 14:25 to anyone who pays attention on the major media uh sites that there's a very strong interest in 14:32 just publishing anything that bashes the other side versus stuff that has I mean is there any 14:37 actual continuity even on our Bitcoin like our BTC has always been like notoriously like just 14:43 like kind of like a cringe fest or just crazy people but even now our Bitcoin there's rarely 14:48 any actual content other than the price memes which are like their own form of junk food or 14:53 something you know they're like now so I I don't know yeah I think uh another thing it's possible 15:01 that it kind of the existence of a a non-Blockstream sidechain thing might have made people 15:07 feel awkward even though Adam Back was always very supportive of it so I don't I kind of don't think 15:12 that that's the explanation but I suppose it's possible. Between Adam Back and Luke Dashjr. 15:16 I mean yeah you got right yeah we had Luke Dash associated with Blockstream and we had the um 15:23 and he yeah Luke Jr.'s post was sticky by Famos on our Bitcoin for like two weeks or something 15:29 and so I thought so I think there is actually a a lot of support people a part of it is I think 15:34 maybe just that the idea was still being you know I was still finishing it and you know how it is 15:41 like you making these changes and it's all in flux and then if you're not the guy who's on top of 15:45 that like basically if you're not me or Cryptex Patrick then you wouldn't you wouldn't like even 15:51 know like what you were actually talking about like what you were even endorsing because you 15:54 know where it's kind of like wet concrete which is uh you know that's kind of a shame 16:00 you know the concrete would have dried faster if more people had helped and it's still not you 16:05 know it's still not totally finished and your one approach to that is to say well I'll come back 16:10 when it's finished but another approach is to just jump in and and finish it you know like you 16:16 can help finish it uh so that's kind of are you looking for developers still to help you 16:23 I think it's great if anyone can go can you just read the BIP documents which you were kind enough 16:29 to point out like last week or whatever it was or no not last week um on Sunday I'm losing track 16:37 of time sorry one day is a in Bitcoin one day is like a week right it's yeah absolutely that's just 16:43 how um yeah yeah it's uh it's absolutely fascinating to me and uh and like uh you you've 16:51 gotten a little bit of feedback so far I guess we can yes yeah a little bit of the technical 16:58 a little bit um so do you want to just sort of briefly describe the hardest part which is sort 17:03 of bringing back biggest points from the sidechain back to the main chain okay that is really 17:08 important so that is why I actually I specifically renamed the first BIP and I called it hash rate 17:14 escrows because I didn't want there to be any confusion or like I wanted to be totally transparent 17:19 about what this is which is that you're locking the money to an SPV proof when you use sidechains 17:24 and that has always been the sidechain story and that that must be the sidechain story so let me 17:30 just unpack that for a little bit so what I mean by the SPV proof is that you're only checking to 17:35 see if it's part of the heaviest chain you don't check to see if it's part of the heaviest valid 17:39 chain you have no idea what the chain what is in the chain and let alone whether or not 100 17:46 of the chain's contents are valid which is what the definition is for the heaviest valid chain 17:50 so SPV mode just checks to see that there's been a lot of work done do you are maybe the heaviest 17:57 you know you never of course epistemically you never know if you're actually on the heaviest 18:01 chain or not but we we have strong guarantees that you are and stuff like that like the size 18:06 of the planet earth is only so large and you can only suppress the information for so long and 10 18:12 minute block intervals and other things so uh so there is no way either you would you want to avoid 18:20 is that you don't want to burden bitcoin core with all this other junk so you don't want it to be 18:25 regress and become an extension block so maybe this conversation will get a little confusing but 18:29 the point is the point is you actually want to send the transactions in a place where you can 18:34 ignore what's going on there because that is the entire point and i think this is often 18:38 misunderstood so i'm glad that you're asking about it because the whole point is that you kind of 18:43 in quotes reduce the security because that is the entire point you're not you don't want to 18:48 you it's all about what you gain in return you don't look you don't have to look into all of 18:54 that stuff and check all of it within the sidechain you're talking about you don't have to check 18:59 anything within the sidechain you just sort of we want to make like two people happy we want to 19:02 make like luke jr happy and we want to make like roger veer happy so maybe that can like that maybe 19:07 that can like help figure it out what does luke jr wants nice and small blocks that are easy to 19:13 validate right he doesn't want to do a lot of work you know not proof of work work but he doesn't 19:18 want to do a lot of checksig operations and bandwidth of a transaction data and everything 19:24 like that so the the sidechain has to be kind of optional or it has to be a kind of giant anyone 19:30 can pay situation where there's a lot of degrees of freedom this money could go to a could go to 19:36 b could go to c you don't know and you you don't care if you're the luke jr type so if you're the 19:42 conservative type you don't care you just want your little thing locked down and you don't want 19:47 a lot of you don't want to you don't want so that's the point is that you're just kind of 19:51 going to you're going to just you're not going to have the node check all that stuff so as a result 19:58 the only thing you have the only weapon you have is spb level security which is pretty strong 20:04 security but we're going to like you know push the boundaries so it is experimental and it could 20:09 the idea could not work but the point is that this spb level security is checking the heaviest 20:14 chain it's not checking the heaviest valid chain because it has no idea what's in the chain 20:18 by definition so what you are trying to accomplish is merely that so this reduction in knowledge is 20:28 intentional so that's what i'm trying to say is what you are doing is putting this money such that 20:34 the miner can send it anywhere and that's why i named it hashrate escrow so that's what i was 20:38 getting at with that i see so the miner puts it somewhere that they they just don't really care 20:45 what happens during the time that it's escrowed but when it comes back how does it come back yes 20:51 so this is the challenge so since you're doing you have you have a you have like a big challenge 20:55 because now the miners can send the money anywhere so someone's going to ask well why wouldn't the 21:00 miners just send the money immediately to like jihandu's personal bank account right like that's 21:05 where you would presume it would be sent in a sort of naive sense and so what you have to do is you 21:11 want to really make the uh you the what you want to do is okay so i'll just explain literally what 21:19 i what happens in Drivechain without talking about like kind of the there's a giant like 21:22 philosophy behind this but in practice what i do is i have all the the transactions wait so the 21:29 transactions are very slow come back and they all get batched up it's kind of like an airplane so 21:34 if the if each network was an island and you're on the sidechain island and you're on like you 21:40 know rootstock island or something and you want to send your you got bitcoin there and you want 21:44 them to go back to being bitcoin core bitcoin then you tell them that they want to leave and 21:49 they sort of show up at the airport and rootstock airport and then they all wait in a big um in a 21:56 big group and then an airplane comes and picks them up and very slowly taxis them back over to 22:04 bitcoin core island and so the point is they come back very slow excuse me they come back very slow 22:10 and we announce in advance exactly where the money is going so it's very easy to check the 22:16 the sidechain software will sort of report exactly what it should what should be what the 22:22 transaction going back should look like and the um there's a commitment that the miners sort of 22:31 use yes there's a so there's like yeah it was like the hash commitment to the transaction 22:36 on the sidechain so it's very easy for human beings to check and see what that is and then 22:40 there's the hash commitment is uh introduced on the main chain on bitcoin core and so then 22:48 there's a long waiting period which i would imagine is going to be a minimum of two weeks 22:53 and then there's a very long period where we acknowledge do they do they match or do they not 22:59 match and there's like a little upvote downvote count and once per block 23:03 they increment this count up or down and if the count reaches a certain threshold 23:08 then that transaction is considered valid and otherwise it's not considered valid so it's a it's 23:14 a minor vote is what you're saying to come back well see that's what i'm saying is the spd proof 23:19 is also a minor vote so this is kind of acknowledging that so a lot of people feel very 23:24 uncomfortable with this but uh i think they they really should not because there's a long precedent 23:31 of related events happening that were fixed much so we had a there was one uh instance where we 23:39 accidentally printed like 92 billion bitcoins or something negative overflow or something like that 23:44 yes exactly there was a an overflow and uh that was fixed within like five hours and then there 23:51 was the march 2013 event that was deals like these are total emergencies that were unexpected 23:57 and they were easily fixed uh that was fixed in like 20 blocks or something like like like two 24:04 hours or something like that uh and so we have a lot of precedent for um when something's obviously 24:12 wrong it uh it gets fixed and Drivechain does not like and there's a sign there's a small sense in 24:19 which that dry chain fundamentally relies on something like that or something like the user 24:24 activated soft fork where there's some push will come to shove and they will if the miners really 24:31 want they will like fork the chain by doing in a fraudulent withdrawal and then they'll fight it 24:36 out there'll be two chains and they'll fight it out in the marketplace or something like that 24:41 so that's kind of the that's kind of the seed or like the foundation but in reality i think it would 24:47 never get it's sort of like a supreme court that the user activated soft fork idea or the the fixing 24:53 of the bug idea the march 2013 that's kind of like the supreme court that's like if there's this big 24:58 big big dispute 24:59 that's going ongoing for the whole month in multiple like months and then it reaches this uh this this place then that will get the final say but in practice most people follow the law or comply with the laws without you know needing to arbitrate every single you know everyone has people have all these yeah yeah people people settle their differences before it gets to court yeah so that's another thing is that there are these atomic no one actually has to use 25:26 any of the mechanisms for shepherding the coins in between chains because they have atomic swaps 25:31 which are basically like a kind of shape shift type thing which work instantaneously so you would need 25:38 lightning yeah the speed is not yeah well the atomic swaps are even different than lightning so 25:42 you can do the atomic swaps and you can do uh like you can do lightning through the sidechain 25:48 or you can do an atomic swap transaction on chain atomic swap yes you can do an on-chain atomic swap 25:55 yes so without in that sense you would trade your rootstock bitcoin to someone else you if you like 26:03 you uh if you and i would be on you you would exist on the rootstock island and the bitcoin 26:08 core island and i would as well and so i would give you a you know i'd give you say uh one bitcoin 26:16 on rootstock island and then you would give me 0.99 bitcoin on bitcoin core island we'd do that 26:22 at the same time and that does not require any weird Drivechain stuff like that so what i'm 26:27 trying to say is although the problem is big and although it's solved in kind of a crazy way 26:33 it's what you what i've done is i've kind of like lined all these things up so that it's actually 26:39 really really difficult in practice to imagine yeah but it's not possible it's not impossible 26:44 and so people should be aware aware of the the risks um but as i was saying before you should 26:49 also be aware of the benefits because the benefits are very extreme so here's the thing is 26:52 if push comes to shove so like let me explain one more thing is that the rules for Drivechain 26:59 carefully limit like it's it's supposed to be very light on attention how much attention the 27:04 user is required so that's part of this two-week waiting period where the software everyone running 27:09 a sidechain node will know immediately the instant that they don't match so you'll know immediately 27:15 but i say there's a two whether it's valid or invalid or whatever it is there's a two-week 27:19 waiting period so all this stuff that i was just described was fixed as in a sort of an emergency 27:24 thing by volunteers within like a few hours but this is something where so this we don't want to 27:29 we don't want to tax that because we don't want to just try to exploit that and drive that resource 27:33 to its limit that's very unfair but i've thrown all these these kind of like these hurdles in for 27:38 the attacker where they've got to wait like two weeks where it's just like x is saying equaling 27:44 y but they just don't they just aren't equal you know and there's just nothing they can do about 27:48 how wrong it looks and then you have this long period where miners can either upvote or downvote 27:54 so at a certain point you'd say why are miners uploading because it's wrong but then after you 27:58 know another couple of days and we know how long a day is in bitcoin it's a week of pre-bitcoin 28:04 lifetime it's you wonder like why aren't they why aren't other miners just downvoting you know 28:09 because you could it's very easy for miners to just sort of downvote everything and say i don't 28:12 know what's going on but let's delay this until we figure it out so they can easily delay and the 28:17 delay is always advantageous to the honest party because it gives everyone more time to figure out 28:22 yeah yeah i think essentially what you're doing is you've aligned all of the incentives so that 28:26 there's social pressure put on the bad actors in this sort of scenario yeah you're right that is 28:32 and i think that is very important that there's kind of a sort of a stigma or a shame of just like 28:37 the miners is doing something that's so obviously wrong but it's financial pressure as well as 28:41 social because if push comes to shove and they actually do a fraudulent withdrawal and the side 28:47 chain is sort of like a healthy sidechain that people like and so if we have the actual bad 28:51 event happen where people were actually using the sidechain they put a bunch of significant amount 28:55 of money over there miners withdrew the money for themselves one thing is that it's just as easy for 29:00 them to miners to steal all of the money as it is for them to steal any amount of money so that kind 29:05 of makes the very act itself less forgivable and more threatening and more kind of crazy so that's 29:11 intentional as well but the financial pressure is that the uh the market price of bitcoin would 29:17 i think have to fall because what it would mean the end of not only that sidechain and not only 29:23 all the fees on that sidechain but i think it means the end of the sidechain experiment because 29:29 it means that this model doesn't really work and so what it means is that but i think if this model 29:34 doesn't work i think really no model can work because as i tried to explain you are you are 29:38 kind of trapped because it's intentionally you cannot intentionally you are not allowed to have 29:43 bitcoin core check the sidechains rules which is the design challenge so if that doesn't so if they 29:49 steal once it kind of breaks the whole thing which means all the sidechains features which users 29:54 might like and all future sidechains which might have great features that might be invented in the 29:59 future um that might not you know all that is destroyed and all the transaction fee revenue 30:06 on the all those chains is destroyed and i think that that is um you know that i think that would 30:13 merit uh not a great response especially given the fact that if push came to shove users could 30:21 user activated soft fork to block to block the fraudulent transfer at which point they would 30:27 basically split the network in two one where everything was honest and where something was 30:30 dishonest so i think that would be just i mean how can the honest business person 30:38 lose a fight against the dishonest i think you have to i think we already know that the bitcoin 30:43 security model requires 51 of the miners to be honest i think you're just sort of extending that 30:48 and sort of uh uh you know sort of taking that to a further limit than maybe it currently is in 30:54 bitcoin exactly that is exactly what i'm doing it is riskier and people should be aware of that 30:58 but i'm trying to i'm drawing on these experiences that we have had times where you know we have the 31:06 value overflow incident and it was you know we have there is it's not as though it's not really 31:13 the case that that people just roll over and just let the miners just take the money out of the 31:20 chain and the mere threat that users might do something about it is really enough to say in 31:26 the supreme court type model yeah yeah and and this is why like selfish mining and a lot of 31:31 other theoretical attacks have never been on the network is because users would get really angry 31:37 and they would it would just bring some action all it would do yeah selfish mining is a very 31:41 interesting property where it uh if if if it really is better than every miner has an incentive to do 31:48 it and if every miner has an incentive to do it yeah it's stuff just breaks horribly you know 31:53 what you would have is you'd have like no one officially finding a block right because no one 31:56 announces yeah no one announces so there would never be a block announced and then some naive 32:02 idiot like four hours later would announce a block and then all of a sudden there would be like 32:06 you know eight different like 40 block chains that would all be announced or something like 32:10 that and then yeah as you can see but if everyone does selfish mining there's no gain because it's 32:16 a relative it's a relative advantage i mean it's mutually assured destruction um this minor 32:23 strategies all cancel each other out constantly i mean it's very difficult because if everyone 32:27 does them they just cancel out so as you say well as i'm saying there's no benefit but as you say 32:32 the cost is that it just just screws up the network and so it's not that's a big reason why 32:38 we it just takes effort to put that thing in and it doesn't it just wrecks everything so it's not 32:43 surprising that we see this but yeah you understand i think you get it perfectly which is 32:48 that i am kind of like you know i'm kind of taking that as an established scientific fact about an 32:55 empirical fact whereas before i was just kind of like oh isn't that maybe this will work maybe not 32:59 but yeah i think it's been proven over the last eight years uh all right so let's move on to the 33:05 actual um mechanisms uh so we we talked a little bit about hashrate escrow and i think uh i think 33:11 we've more or less described it there the funds go into sort of like a minor escrow and uh they 33:17 can come back uh and the miners sort of have to vote on it but that mechanism doesn't necessarily 33:23 have to get used very much it's kind of like an etf uh you know where you have a basket of 33:27 currencies or something like that there there are are people that will arbitrage and sort of 33:32 uh keep the price this very similar uh but you know that's not the main way in which people get 33:39 in and out of it you you said something about atomic swaps and maybe lightning even um what's 33:44 this other one this Blind Merged Mining that that's the bit that um i'm still trying to wrap my head 33:50 around can you describe it for our uh viewers okay so i think it's easier if we let's like 33:57 hashrate escrow is basically say it's an account where you put these timing parameters in and as 34:03 long as users can very easily you know check these hashes as we just described miners can send the 34:08 money anywhere and that introduces the infinite flexibility required for sidechains and so then 34:15 what you want is see it's kind of it's an interesting timing thing too as well this is a 34:20 very simple principles that are that are not kind of cryptographic at all but it's kind of like 34:25 you create a weird sidechain a weird hashrate escrow and then and then after you create it you 34:30 have to convince people to use it so it sounds kind of crazy to say oh are people really going 34:34 to put this their money in an account that said that says the miners can send it anywhere and my 34:39 answer that is you know they probably won't unless the you know you got to convince people that okay 34:45 here's my you know my narrow sidechain and it will be very easy for you to check what's going 34:51 on here and that is part of the thing so it's kind of neat because that part but what i'm saying with 34:57 hashrate escrows you have a lot of flexibility so you can do whatever you weird ripple stuff 35:01 you know even r3 corda you can do literally anything there you could do proof of stake you 35:06 could do proof of space and time which is bram cohen's you can do whatever weird thing you're 35:12 right because you as you understand i'm just putting money in a box and then opening the 35:15 box and sending it somewhere else so that is lots and lots of flexibility but the other thing is that 35:22 what we really want is we want something like Namecoin which has merge mining and so what i 35:26 did is i i kind of optimized the merge mining idea to work with Drivechain the best and in so 35:32 doing i solved uh two kind of remaining quirky problems with original merge mining 35:40 you know first is that with merge mining so i merge mining is very difficult i think to explain 35:45 i think lots of really smart people like have no idea how it works uh and so i have like let's 35:50 you put a hash commitment into the coinbase before you mine the bitcoin block or something like that 35:56 yes so it's yeah uh it is it's what is the weird thing is you set up the your software so that it 36:05 hashes a see that i'm not now i'm gonna screw up the explanation because i'm dooming everyone but 36:12 basically what you do is you set it up so that what you actually are doing is mining a Namecoin 36:17 block uh and then the Namecoin block looks really weird but when you find the 36:25 see you you you're trying to mine a Namecoin block and you're often you're succeeding because 36:29 Namecoin's difficulty is lower but when you but sometimes you succeed and you actually 36:35 mine something that it hits Namecoin's difficulty target as well as bitcoins so 36:41 what you've done is you've set up something that's a Namecoin block but 36:44 inside of the Namecoin block is a bitcoin block so you ended up mining both at the same time so 36:50 it's very kind of weird uh it's but the point is just that what you have is a second network 36:58 and what that network does is it says that it it can say uh it can it can download so bitcoin 37:07 and the blockchains they have these headers and there's other block data that has everything 37:11 important that's happening but then there's all these headers and that's how we check 37:14 to make sure that the enough work has been done you only need to check the headers and 37:19 they're only like four megabytes a year and that is the magic of spv for people who are into that 37:25 which is increasingly fewer and fewer people but be that that's not really relevant to what 37:30 i'm saying all i'm saying is in order bitcoin is very clever about the way it works where it just 37:35 checks a small amount of data for the work puts all the work on this easy to check part and then 37:40 we have all these big blocks that have all the that are the one megabyte blocks and so what 37:45 merge mining does is it lets you kind of draw a weird line that is like sometimes Namecoin only 37:51 headers and sometimes weird bitcoin headers that are it kind of lets you feel like a weird tangle 37:56 so maybe i should just give up on explaining it because it is notorious and basically what's the 38:02 miners do is mine two different networks at once yeah at no cost to them uh and so for a long time 38:11 Namecoin had a large percentage i don't know 80 and at one point it fell to like 55 for multiple 38:17 years a 55 of bitcoin's hash rate and something funny very funny happened recently that i will 38:24 talk about that right after this but uh it had 55 of bitcoin's hash rate despite the fact that 38:31 there was something like i think it was a four orders of magnitude difference in the reward so 38:36 if you mind bitcoin only you got like 30 000 per block or something and if you mind Namecoin 38:43 you got like five dollars per block and they were both 10 minutes each and so you know 55 of the 38:51 hash rate was going for both it said i want the 30 000 plus five you know even though it's a tiny 38:56 tiny tiny little thing um which is very funny the real question though is why isn't it 100 39:02 because it's a free five dollars and the answer is that first of all you get paid in Namecoin 39:08 dollars you know you don't get paid in bitcoin so you got to exchange it so it's slightly 39:13 inconvenient but the other problem is that you had to run the Namecoin full node because you 39:17 had to assemble the block so you would know you would assemble the next valid block and so you 39:21 had to know what what block you were making and the Namecoin uh software was just you know no 39:27 offense to anyone and everyone is doing a great job but it just wasn't as maintained as much as 39:32 bitcoin core so it would crash and then when it crashed the entire mining operation went down so 39:37 it actually wasn't free the mining operation would go down when Namecoin crashed so some people 39:42 weren't up for that but other people had clever things where they could make it so that if it 39:47 crashed it wouldn't like you know destroy it like they had different instances or something 39:52 so they had a way of like clicking it over or something else but um so what Blind Merged Mining 39:58 does is it says that actually uh nodes sidechain nodes will assemble the block and pay themselves 40:05 the sidechain fees and then what they will do is if they happen to be someone and i imagine this 40:11 would be everyone but if they happen to be someone who runs the sidechain node and owns funds on the 40:16 main chain bitcoin core so they are on whatever island running a node because they want to use 40:22 that feature and they also exist on bitcoin core because the vision for Drivechain is very 40:28 asymmetric one and a very hierarchical one so it's that where core is kind of literally the center 40:34 and then pyramid in those sidechains and then maybe those sidechains of sidechains possibly 40:39 but the vision is really that core is the center and so this is a very robust assumption that 40:47 whoever's running a sidechain node either does have or could easily have or just that 40:53 two or three or four people who are running a sidechain node also have money on main chain 40:59 bitcoin and so those people what they do is they just make a payment to they say i'll pay miners 41:09 xyz if they find this block and so they find a block say it's a sidechain they find a block 41:15 paying themselves 17 sidechain bitcoin or something like that and transaction fees 41:20 so the sidechain block is a normal blockchain it's there's all these transaction fees up for grabs 41:25 the sidechain nodes all assemble the blocks excuse me some of the blocks paying the 41:33 these transaction fees to themselves which is exactly how mining works right now with all 41:37 the miners assembling the blocks and paying the transaction fees to themselves and so the 41:43 difference is that you the sidechain node obviously can't get the proof of work so what 41:49 they do is they just buy it and so they say i'm paying myself 17 bitcoin if i if i find this block 41:57 and so they make up on the main chain bitcoin they make a little payment that says okay 42:01 i'll give you i'll give i'll give you mr miner 16.9 main chain bitcoin if and only if 42:11 the next block that's on merge mines my thing merge mines my sidechain uh block so they can 42:18 sort of are between the two a little bit and get the difference they should they should try 42:22 you know it should be as long as there's more than one it should be very competitive where they 42:26 should be kind of because you can only find one sidechain block per sidechain per mainchain block 42:33 if that is not too much of a mouthful but long story short is that the miners don't have to do 42:39 even less than they had to do before so now it's as if in this world you don't have to convert 42:45 anything because you get paid directly in bitcoin coins and they don't even need to know anything 42:49 about what's going on in the network yeah you know they don't have to really run the sidechain 42:56 which is kind of a huge innovation right this was always the problem with merge mining was that 43:01 you had to give up all this bandwidth to receive all of the transactions from the merge mine chain 43:09 which now you don't have to do with uh Blind Merged Mining yes there was a fear that someone 43:13 would create i keep finding funnier and funnier names for it i'm calling it like the espn 4k 43:20 chain or something like that there's this risk that someone would i'm trying to think of like 43:24 a funny thing because the the threat is someone comes up with a very a chain that has a lot of 43:29 revenue but it's like horribly bandwidth intensive and so it's like leaking the location crypto 43:37 crypto kitty sidechain yeah right that could be like crypto kitty or crypto rabbits or something 43:42 run amok and they're everywhere they're breeding really fast yeah exactly it's exponential growth 43:48 they know how long until the lake is half covered in rabbits that yeah yeah but you you've essentially 43:55 made it so that uh you can merge mine without necessarily knowing that much about the chain 44:00 which is uh very beneficial to the miner to merge mine because it's all upside very little downside 44:06 as far as they're concerned because they right and the point is that it doesn't just it shouldn't 44:10 disadvantage any smaller miner or anything like that because the miner even if the ideally all 44:17 the miners would be connected to a pool and the pool would have you know just two or three or 44:21 four connections to some sidechain nodes that would do this and then they get all the the 44:26 revenues and they don't need to worry about any of this thing now there's that's obviously not 44:30 free either but it's it is i argue that it's actually the exact same security model that we 44:37 already have which is something that i just emailed matt corral about earlier today because he had 44:42 some feedback about that the issue is that the real issue as i was talking with him about is that 44:50 the sidechain doesn't have its own uh block subsidy so it's not printing any money so it 44:55 doesn't have the 12.5 new bitcoins each block it just has zero each block right because otherwise 45:00 you'd be inflating bitcoin exactly so that's that's a very desirable thing but again there's 45:06 no free lunch in engineering and then you know economics so there's they what the what what is 45:12 really kind of one area of uncertainty for sidechains is that they are in the world where 45:19 we only have the transaction fees which is bitcoin's ultimate destination and now because 45:26 the fees are so high we might actually get there a lot sooner than i thought because we're already 45:30 i think didn't we have i think and maybe even you told me that there was one that was like 13.5 in 45:36 fees and 12.5 which i was i would never have expected that that would happen it was during 45:41 the spammy weekend when everyone was trying to get uh it was the bitcoin cash pump when i know but 45:48 that you know that still that is very that's like that's i would never have thought that it would be 45:52 because before though even the orders of magnitude were yeah like yeah just so vast it was such a big 45:59 difference between 50 bitcoin and like zero fee and then 25 and like 0.05 total fees and then 46:04 we were getting basically only one bitcoin per block fee rate for like most most of this year 46:12 and for that to go from one just straight up another order of magnitude to to 13 it's like 46:18 that was very surprising to me so but then we're already in a case where the fees are more important 46:22 than but yeah but no one knows for sure what will happen when in bitcoin or anywhere else so 46:29 another kind of fun thing is that you might as well do this uh sidechains experiment because 46:34 we'll get to figure out like what things go wrong you know when you have that world but i don't think 46:39 the blind merge my matt was uh anyone who's interested should read the bitcoin dev mailing 46:44 lists both in general but also specifically i have the you know you can see today i replied to 46:51 a matt corral who wrote about this and he has a he has like a concern and he frames it very well 46:57 but what i try to unpack is that what he's concerned about is actually this world with 47:04 no block subsidy he's not the Blind Merged Mining part isn't it makes it just makes it look 47:09 different but that part is not the different part the different part is that 47:14 we only have these little things so if someone wants to do a reorganization 47:18 if someone owns five bitcoin on the sidechain and they send it to someone else and then they 47:23 wait for six sidechain confirmations and then they want to rewrite it with seven the uh you 47:30 know the opportunity cost of doing that or kind of the thrust of doing that will be proportional 47:36 to what is the sum of the transaction fees over those seven blocks right right it'd be basically 47:43 basically that figure more or less uh and if that if that figure is small then that you know is kind 47:52 of concerning so i'm not sure although you know there there is kind of like we've been talking 47:58 about the social cost of sort of like doing something sketchy on the network or something 48:03 seen as an attack and there's a giant social cost to that because people stop trusting 48:09 yeah i think you're right the problem is the problem is that Blind Merged Mining disables a lot 48:13 of that because it just it's blind so you don't know like but in practice you can actually switch 48:18 easily from regular merge mining to Blind Merged Mining so actually i would expect uh you know 48:26 this is kind of now i'm really kind of just you know making stuff up right now it's like 48:30 even worse than it ever was but what i would expect is that uh miners would just literally 48:35 merge mine the chain at first to kind of get it out of the cradle because they'd say okay 48:41 users might like this feature so we're going to make sure that it works because we're the miners 48:45 and we we want the value bitcoin to go up we want this next transaction you know fee revenue or 48:51 something like that and so they i think they would just be they would be the node that tells 48:56 themselves you know what the next block is and it would be very different very very similar to 49:01 Namecoin originally and then as the bandwidth stuff as the resource costs pick up they would 49:10 gradually start outsourcing that maybe who knows or it might just be or it may just be another 49:15 possibility i think i don't remember i think i didn't write that i was almost going to write 49:19 this in the email to matt but i didn't i think another possibility is just that in the world 49:24 without the block subsidy uh that is just a world where people need to wait for more confirmations 49:31 sure and that's that that's a very reasonable position it might just take longer yeah yeah and 49:36 which would be not great but it would uh see the other thing is like it would be not great but that 49:41 would um you know if these are i think what i'm trying to get at is these are these these mysteries 49:48 are not really central to sidechains they're actually central to um 49:53 they're actually central to um how the block how a blockchain performs when it doesn't have a block subsidy or when the fees are low or something like that so they're it's kind of like they're different questions and we might as well like learn about them i mean you might because think about it if you need long more confirmations then it kind of re-emphasizes the lightning network for everything because then you just say okay super long custodial period with multiple custodians and then that is because that's kind of 50:20 a you know binary like heavy side that's either like good enough or not good enough true false and 50:26 so once you get that secure your sidechain security you have the lightning network secure then 50:30 everything's instant and off-chain and private so maybe that's the way to go or maybe there'll be 50:35 some problem with that and we should go somewhere else you know it's a complicated you had an 50:38 interesting sort of thing with the Hivemind slash Truthcoin project which is that you you have sort 50:43 of a native coin within the sidechain that's separate from the bitcoin so you could you could 50:49 uh you could sort of incentivize miners that way all right but that's weird because my project is 50:54 probably the only project that can that actually because i have that exists for a very important 50:59 reason to manage a second separate digitally scarce thing that is not money but is actually 51:06 the reputation of the people i need a way to punish the workers in the system if they don't 51:12 behave so it's kind of like a sort of a very and we could might in a very abstract way describe as 51:19 shares of a kind of kind of a i don't know what to say an abstract kind of corporation of some kind 51:25 so sort of the what was it called the deck right but i mean isn't that concept sort of like 51:32 extendable can't you um yeah well i can do that to mine like a separate sort of token and you have a 51:39 token chain basically well i'm not sure that you could because you why would this second token have 51:44 any value although it's i'm all you know obviously saying that in this world where we have loony 51:49 altcoin world it's like why like i feel like yeah so that is kind of like um my commitment to science 51:59 and empiricism is like you know laughing at that even though i like theoretically they should all 52:04 have no value right but like of course you know what time is what it looks like or future 52:10 expectation of future development time or something like that i do not know why but see mine in in uh 52:16 Truthcoin or Hivemind that token does have a value which is driven by you know trading fees 52:21 and other things and it's inescapably it is essential to the operation of the yeah it has 52:27 monetary value so you could give it out as sort of a minor so that one you could give as a block 52:31 subsidy uh and but i don't know how so because in that one value is coming from different people 52:38 who are making trades in the prediction markets in those in those markets so so there's a there's an 52:43 engine there's like a fuel source so then you could pay out some of that to miners but i don't 52:49 know where you'd get this engine in uh something else like uh where would you get that in uh you 52:55 could try to get it from the other participants but you see that's not a free lunch either because 53:00 so you could say like we will uh you could do like a kind of weird demerge thing or something 53:06 you understand like an inflation tax yeah yeah yeah i mean you i mean i think if you have a 53:12 separate coin uh you that that argues very strongly for some some level of inflating of 53:19 bitcoin so i think there would be a lot of resistance to something i agree that it's been 53:24 said by a number of people i think one of the earliest is gavin andreason that adding just the 53:30 mere existence of an altcoin is kind of cheating the 21 million coin limit because it is like an 53:35 inflation tax it is a separate form of money that is a separate purchasing power it's a separate 53:39 claim on all the assets of i that's that i mean bitcoin is bitcoin you're you're not printing any 53:46 bitcoin on litecoin or anything else um all right so i i do want to get to some other stuff uh i 53:52 mean there's there's certainly been a lot of talk about mimblewimble um as a sidechain uh and you 53:58 know possibly using dry chains to make that work um what what are your thoughts around sort of 54:05 mimblewimble maybe rootstock and all of these other projects that are sort of looking for some 54:10 sort of sidechain tech to make their stuff run well i think mimblewimble is so weird that there's 54:17 no way it has to be a sidechain of bitcoin or just an altcoin there's no way you can like so 54:24 often people are talking about things like uh you know like you can um uh there's a lot of stuff can 54:28 be done with like script versioning and people are always like oh can we work can we fit this 54:34 this weird feature in you know people are really excited like oh can maybe we can soft fork it into 54:39 bitcoin core my own pet little idea but mimblewimble i do not see that happening but you 54:44 never know because andrew bolster has pulled so many rabbits out of so many hats at this point 54:51 just crazy yeah yeah but then the other thing is the it is it is kind of confusing because 54:57 mimblewimble is there's a it's just slight it's you know it's super cool but it's slightly the 55:03 experts have discovered that aspects of it are a little disappointing so not me but i'm just 55:08 repeating what i've been told which is that the the the privacy aspect isn't as great because an 55:15 adversary will be watching the network everything and they'll log all this so the ability to combine 55:20 them and hide them with each other won't really help because the ability what is it called the 55:24 non-interactive combining that doesn't really matter because the adversary is going to watch 55:30 everything so it's going to be as if it were interactive or something for them because 55:34 they're just going to watch everything and then even the um the shrinking of the blockchain doesn't 55:39 matter because in real time when you're trying to find the next block it's like at the frontier you 55:45 have all the same bandwidth problems you have before so the main benefit is in helping people 55:50 catch up and you can show them this thing that lets them it's also confidential right like more 55:56 or less it's uh there's no addresses or amounts so yeah right the amounts are 56:02 i don't want to you know it's not really my area of expertise but yeah that's my understanding is 56:06 that it's much more um private which is great but i was just pointing out that this other benefit 56:12 is also not great because the sidechain is already spv level security so you're already kind of 56:18 just taking that the last six months are not wrong on faith or something a bit see bitcoin 56:25 see bitcoin core can do a lot will do can and will do a lot for the sidechain because it's 56:32 going to do all the global accounting so it's going to keep track of the 21 million coin limit 56:38 and it's going to bitcoin core not the sidechain will know okay 17 000 bitcoin have been sent to 56:45 this sidechain and only 3 000 have come back so bitcoin core will know all that and so that um 56:51 so the sidechain benefits a lot and so it's that's kind of part of the reason why it also 56:56 hides some of the privacy right you know how much has gone into that sidechain right the 57:01 you want the barrier uh the transactions going in and going out will be they will have to be 57:08 a regular transactions yeah so they have to be they cannot those are there's a limit where 57:13 it's impossible to do because bitcoin core has to understand what that is before it can 57:17 um yeah allow that so that's there are some kind of thing but yeah i i think that i think it would 57:23 be really cool it would be a great way of trying out mimbo wimbo like with real bitcoin i think 57:27 people would really enjoy it and maybe more private i think there's definitely something 57:32 like monero where there's some like these this the chain is much heavier or even especially because 57:39 of the way monero works in practice where they uh they hard fork every six months or every year or 57:46 so and so they that's better that's a better fit for spv mode because spv mode just kind of is 57:51 saying we won't check literally every detail of everything but we are we're kind of trying to just 57:57 stay in sync uh in an efficient way and we're gonna well there's a trust of a majority of whoever 58:04 you're connected to there that's that's part of the spv security and that helps for it's because 58:10 you're already there with sidechain so you don't lose anything extra by doing that again so you 58:14 could have like there could be multiple there could be like two different um and it could be 58:19 out of phase two different um what was i just saying monero uh sidechains and they could be 58:25 like one could be every june and one could be every december that they shut it off and then 58:29 they turn it back on and then even though they have this endlessly growing UTXO problem they 58:34 wouldn't because they just kill off the chain and so bring everything back and then go into a new 58:40 sidechain okay that would be great like a big uh you know like a big uh tumblr or something like 58:45 that and that would be that would be it'd be it it's interesting because you have this idea of 58:51 a sidechain reset you can bring everything back and then re reset the the chain so you don't 58:56 actually have to keep track of everything and yeah if it was too popular that's what you do 59:02 exactly exactly so uh again i try to emphasize that it's a lot easier to understand sidechains 59:07 if you just imagine them as altcoins that's you know so they're just all coins with bitcoin's 59:12 accounting where the bitcoin's 21 million coin limit so you can really just do just any weird 59:18 stupid thing you want to do on an altcoin you do any weird crazy thing right you know it doesn't 59:22 matter but what does matter is that if you you know the um it doesn't matter if these transactions 59:30 coming back and if people don't believe that they will be able to withdraw their money they will 59:36 never put it in in the first place and so that will that itself helps a lot that's a big part of 59:43 the model it's just the timing yeah it would be interesting to see sort of like the first 59:47 sidechain vulnerability where somebody sort of deposits a lot of money into it and then somebody 59:53 sort of steals it from them on the sidechain and then you know sort of what happens with like 59:58 you're sort of putting miners in this weird position where they could sort of adjudicate 1:00:03 or something like that kind of like you know they get to be vitalic with the dow or something yeah 1:00:08 that is unfortunate so i tried to address that i think but yeah but ultimately it's not really a 1:00:15 bad thing i think because the miners are going to want to do whatever is best for the value of 1:00:21 bitcoin and i think that that is enough of a guiding light really to just kind of just say 1:00:25 like whatever you know like i don't really you know so i but but most of the time what's best 1:00:31 is that you know because what if someone's going to wake them up in the middle of the night and say 1:00:35 oh it's 3 a.m we need to we need to roll back the you know the vitalik kitten inside and then 1:00:42 they're just going to hang up the phone or whatever you know like but if it's important then they'll do 1:00:46 it so it's kind of like a kind of this isn't very much of a cheating kind of answer but it's kind of 1:00:51 like if it's a big market we'll figure it out they'll figure it out and if it's not a big problem then 1:00:55 they won't figure it out and then that it's on the it's on the user which is exactly where it should 1:00:59 be it's on the investor and the user to decide what risks and rewards they want to take with 1:01:05 their money which is exactly where it should be right that's much much much much much better than 1:01:11 what we have now which is kind of like just try to guess which set of things is best for like the 1:01:19 the plurality of or you know the majority of investors or something which is which is what 1:01:23 we do now which is it's not you know it's not bad we haven't there are a lot of things we could have 1:01:28 screwed up by now right we could have changed the coin limit we could have we could have done 1:01:32 down we could have done like a mount gox rewrite all these bad things that so it's been going very 1:01:38 well but i just think we can make it even better because why shouldn't you if you want large blocks 1:01:43 or if you want proof of space and time or if you want some other weird thing why you know why not 1:01:49 like you can already get it on altcoin so we're just turning down all that value now the value 1:01:54 that's going to the all coins that we could have in bitcoin and we're just turning it down really 1:01:58 for no reason well so i that that sort of assumes that features are what give the all coins value 1:02:04 and i'm not certain that that is i completely agree with you that they do not um and so that 1:02:10 almost you asked about rootstock and we can almost talk about that but i think rootstock 1:02:14 is making the same mistake that counterparty made or that's what i'm afraid of you know and it's not 1:02:19 like what what do you what mistake is that sorry well i think it's what you said that they think 1:02:24 that people care about smart contracts is a party that's not bitcoin but they can show up to 1:02:31 first and they won't be late and that they can meet new friends and have fun and a great adventure 1:02:36 well and they can get the marketing power of vitalik behind them yeah with uh what do the 1:02:43 wonderkind uh boy genius uh jesus christ savior figure what can't you do right but i think 1:02:51 but counterparty did this they you can go back uh i'm trying to remember was it like it was like 1:02:56 summer of 2013 or 2014 or something 2014 i think where ethereum made clowner party on theirs and 1:03:02 then counterparty made ethereum on there something like that right exactly but no one cared no one 1:03:06 cared about either it just kind of demonstrates your point perfectly i think but in particular 1:03:13 counterparty said look we have the ethereum virtual machine now and counterparty counterparty 1:03:17 did there was a huge pump that day went up like 10x but then it crashed like over the later weeks 1:03:23 and no one cares today because it has nothing it's not about the future yeah it's about something 1:03:28 else and maybe it's a network effect or i think it's a network effect i think it's also you know 1:03:32 i people disagree about this but i think it's a stealth campaign to dethrone bitcoin as the 1:03:39 internet money um by well i mean speaking as an economist i know you i know you have like many 1:03:46 degrees in that is is is that the main value proposition for ethereum then is sort of like 1:03:52 the possibility for taking over bitcoin i definitely think that there's that well people 1:03:58 it's kind of like bitcoin where people are very coy people are very clever about in bitcoin because 1:04:02 a lot of people will pretend on bitcoin to be like a lot dumber a much dumber version of themselves 1:04:07 with all the memes and with all this stuff people pretend they figure out what bitcoin is really 1:04:12 about and then they pretend that they only care about getting rich you know they blend in you know 1:04:17 and they they really understand what real cryptography is about which is like plausible 1:04:22 deniability and like all this so people are very clever about who they and i think ethereum people 1:04:27 are also very clever about that too they know what game is being played and they're they say out loud 1:04:34 they say well you know they can coexist and this ethereum is never trying to compete with 1:04:41 bitcoin and it's and it's digital this is gavin and gavin wood said this i just couldn't believe 1:04:46 that this stuck and everyone was afraid to say that the emperor had no clothes on this one for 1:04:49 years and years gavin wood said that bitcoin is digital gold and the ether was digital oil 1:04:57 yeah i mean they've been saying that for years we are oil to bitcoin's gold after 1:05:01 i thought that was the dumbest thing it was so dumb i mean it's just transparently false like 1:05:06 the function of gold is that if i give you a gold coin you might give me like a really old 1:05:12 car or something i could buy so you got to get it i could buy a suit a nice tailored suit with 1:05:17 a little gold coin and so the function of digital gold is that i can 1:05:23 that you you would accept it in return for its stuff it's it's money it's a medium exchange 1:05:28 and it's a store value and all these things and the function of oil is that it you know it 1:05:34 moves the car or it heats my house or something but it doesn't it doesn't do that like so i don't 1:05:39 know what it's it's a little more voluminous for per um per volume or something like that i don't 1:05:47 know it but it literally is described as like the cost of various computing resources so it's so 1:05:55 it's a it's it is also a value it's also a gold so i don't know what like yeah yeah people said 1:06:01 that thing about oil and everyone was just afraid they were afraid for so long to say that it didn't 1:06:07 make any sense and then if you said it didn't make sense people would be like you don't understand 1:06:10 like i mean they have something called gas paul that yeah right like something yeah it's very 1:06:17 very obscure but i you know you ask my opinion that is what it is that uh people think i think 1:06:23 there's a lot of smart people in ethereum who i don't i don't agree that they're right but they 1:06:29 have these theories that are something like okay with bitcoin too much of it was mined too quickly 1:06:37 and so the all the people who bought into bitcoin that's not enough of a network effect to carry it 1:06:43 over the line so now that blockchain technology is big we're going to have new people and if we 1:06:49 just get a different we just it's it's smart they're like a they're like a second political 1:06:54 party or something they know who they're not going to get they're not going to get like the 1:06:59 hardcore anarchist libertarian even they so they fold that hand because it's losing hand and that 1:07:05 that's why ethereum has all this weird stuff like it has two percent inflation forever but declining 1:07:10 so it's kind of like this weird mix of everything it has if bitcoin is conservative right it doesn't 1:07:15 put in ghosts because it makes selfish mining worse or ethereum puts ghosts just put everything 1:07:21 in a ghost uh uh like i'll be my ghost sorry i i think the uh the uncle thing that uncle 1:07:29 generating heaviest tree or something i don't remember so if you instead of orphan blocks on 1:07:35 ethereum you you get some subsidy if even if you do the uncle thing they do proof of stake they do 1:07:41 everything they do everything whatever it is as long as as long as bitcoin won't do it they'll do 1:07:45 it which is you understand like that is smart if you are playing by this other set of rules that 1:07:50 you want to capture a different group of people and hopefully make it bigger and same thing with 1:07:54 the icos they were like well this you know bitcoin was like get that out of here because 1:08:01 transparently stupid but ethereum was like you know if you've got money you know and you've got 1:08:05 it marketing because they're because and that's so it's a it's a match made in heaven so i think 1:08:10 that is a lot of what that is and even you know honestly the uh it is it's kind of clever that i 1:08:17 don't really i highly highly doubt that it can even possibly succeed because the internal logical 1:08:23 contradictions of ethereum are just so numerous and so there are so many flaws that can't be fixed 1:08:30 but it's a smart it's a smart long shot and i understand why it has value i think now more than 1:08:36 i did in the past because think about it like if they stumbled upon some kind of like sidechain 1:08:41 like thing early on enough and then they kind of wall they they clamped everything down and said 1:08:46 okay we're not changing any of this stuff anymore and if you didn't have the dow which is a big if 1:08:50 because i think stuff like that is inevitable but if you didn't and i may discover some kind 1:08:55 of sidechains thing or something that is like a like a real win like a but they never do they 1:09:01 only copy they only ever copy bitcoin stuff like you know bitcoin came out the lightning network 1:09:05 after years of r&d and like carefully thought and then like two weeks later ethereum has 1:09:12 raiden or whatever it's the same thing you know that's the that's the uh mortal combat lightning 1:09:17 character it's like you know it's like who are we kidding here you know so right afterwards and 1:09:23 then people talk about sharding but none of it goes anywhere and then i'm sure now that i'm 1:09:29 talking about this then suddenly ethereum will have a new exactly what i'm doing but with the 1:09:33 well yeah i i imagine that'll be their scaling solution at some point is we're gonna have 1:09:38 sidechains yeah so let's talk about that because that's a cool thing that's my lawn presentation 1:09:43 which is not only that you have the larger block sidechain and let roger veer go over there 1:09:47 but also that the whole system is a little bit better because it is like this 1:09:52 this um it's just like a strategy it's this martin bailey strategy you might be familiar with 1:09:57 the mountain valley i don't know it's a logical fallacy really where people sub some things in 1:10:04 they it's like a shell game where you attack from a weak position and then when you're counterattacked 1:10:11 you retreat to a strong position and so you're it's it's completely illogical and very unfair 1:10:18 and invalid and wrong because you have to just pick what your position is you can't keep changing 1:10:22 it right but but the defense is that you have this um you uh have this this duality where you 1:10:31 can switch when you're being attacked versus when you are attacking so the point is everyone can 1:10:37 hang out in the nice part which i believe is the bailey yeah the bailey is the nice part 1:10:42 where you want to attack from so you have the large block sidechain you hang out there 1:10:46 but then when the bad guys show up and attack the network then you just kind of put the large 1:10:52 blockchain on pause and you can even keep it on pause forever and potentially even just close it 1:10:59 down and slowly walk everyone's money back from the large blockchain to the small blockchain 1:11:06 and so you can kind of uh hang out in the large blockchain but then retreat to the small blockchain 1:11:12 like at a moment's notice and uh and because you can do that this is the real magic is that because 1:11:19 you can do that the adversary is less likely to even attack the large blockchain in the first 1:11:24 place so it's like you have this big castle castle of the moth in fact i'm pretty sure 1:11:29 game of thrones deepwood moth is named after that idea which is why i think that names are like that 1:11:34 but uh the point is you have this big stone tower thing you retreat to that in times of crisis but 1:11:43 since you've got one there no one bothers attacking you in the first place so you're hanging out in 1:11:47 the plain the nice meadow the whole time because they know that you're just gonna as soon as you go 1:11:52 over there you're just gonna go back into the yeah it's uh it's taking advantage of um one part of 1:11:59 yeah i i think you can imagine like imagine in your mind like two newspaper headlines right one 1:12:05 of them is like u.s government closes down bitcoin and then the subtitle is like ha ha ha you stupid 1:12:11 large blockers you know you you ruined everything and now all there are no nodes and it's all been 1:12:17 ruined okay they put dmca take down on all the nodes or something weird like that you know what 1:12:24 i mean something weird happens to the large something that's not defined happens to the 1:12:29 the large and the large um large block network but then a different newspaper headline would 1:12:38 be something like uh some bitcoin transactions will now be more expensive and slower as a result 1:12:46 of you know u.s government or something just one is like the u.s government has a victory 1:12:52 right over bitcoin but the other one is just that the u.s government is just kind of being 1:12:55 annoying to people who are using the the large because they can always just go over somewhere 1:13:00 else yeah and the people on the large blockchain are probably your price sensitive like the division 1:13:04 that i have is that that's all the price sensitive people over there so they are like all the honest 1:13:09 kyc aml people so that they're just shooting their own like the the the good code the kind 1:13:16 of well-behaved people that's not unusual for the u.s government so yeah um but i'm saying and 1:13:23 yeah i'm not saying it's impossible but i am saying it's like it's like as a as when you're 1:13:28 looking at the kind of menu of options that you have if you're the if you're the attacker 1:13:35 you want to pick something that will work you don't want to pick something that won't work 1:13:38 so right that's something that's not actually going to work then you won't you won't try that 1:13:42 you'll try something else okay all right so i did have another thing to ask you about um i think 1:13:47 monero was talking about doing mimblewimble on a sidechain of their own um how can you imagine 1:13:54 a sort of sidechains working within sort of a monero framework because they they have a completely 1:14:00 different uh sort of set of things i have no idea but the way Drivechain works is also 1:14:05 kind of totally different so we have all this weird stuff that is just kind of 1:14:10 kludged into just going to weirdly fit into bitcoin because it has nothing to do with like 1:14:15 you they're not even i i think on sunday you mentioned opcodes but they're not even opcodes 1:14:21 because none of that it was started as opcodes but then as we were working on it we figured out 1:14:26 that it doesn't make any sense because nothing is really happening on the transaction level 1:14:30 anyway it's all happening on the block level so it all ends up in validation.cpp for the block 1:14:35 so uh Drivechain is like uh kind of uh different from the way bitcoin and monero work so they 1:14:43 could probably take i have no idea what they are planning to do and that would be really neat if 1:14:47 my guess is that they actually aren't but i don't know anything about it so i shouldn't say 1:14:51 because but just because i was talking to ricardo uh otherwise known as fluffy pony and he's uh 1:14:59 yeah he was mentioning something about 1:15:01 maybe adding mimblewimble like uh abilities to a sidechain of monero and uh i i'm not sure if it would be exactly pegged um i i don't know i'm gonna have to ask him again 1:15:10 yeah i don't know anything about it but yeah it's fine yeah uh anyway uh i i i can't believe it but we we've been on for like 75 minutes already so uh yeah so uh i i think we're gonna have to uh cut it off here but thank you uh for coming on the show 1:15:26 cut it off here but thank you uh 300 plus viewers that have been watching live uh paul any last words 1:15:34 about Drivechains and the future of bitcoin as a result uh yeah okay that's good because i just 1:15:39 thought of something which is that i don't want you know this is just an idea and what i'm trying 1:15:47 to say is that i'm not really trying to present this because i started off by saying it's like 1:15:52 and like it's it's a project for everything for everything and nothing 1:15:57 but i'm not i don't know if it's for everything or for nothing yet it's just an idea and i think 1:16:03 it's a really good idea that's worth your attention and worth really trying and i'm not 1:16:08 trying to say that this is like the big ultimate savior of everything but i think it has that 1:16:13 potential and i think that you should just uh kind of give it uh some of your attention but i don't 1:16:19 want to say that i'm not like so arrogant that i'm going to say like this is the the only thing 1:16:24 that you'll ever need that's the kind of stuff that the ethereum people say i hate that that's 1:16:28 stupid like this but yeah what i'm saying is that i think this is this is really different and you're 1:16:35 probably going to hear a lot of you know arguing about this idea which is great and i that's 1:16:41 awesome but you should go to the drivechain.info and you should read the faq and you should read 1:16:46 about what's going on because this idea is not it's not like other ideas like regular ideas like 1:16:53 check sequence verify or something it's just it's a lot of code and a lot of testing and then it's 1:16:57 like if some number matches some other number a math equation doesn't work and then the transaction 1:17:03 fails but this is very different this is more like this is more like inventing bitcoin for the first 1:17:10 time so i want people to have a more of an open mind than they would have before because the 1:17:15 benefits are way bigger and also the the idea is just bigger so it's a it's it's it's not like 1:17:22 we're just editing some little transactions so that it can do one or two more little like uh 1:17:28 you know backflips or something it's this is like a big idea and it's it's really um 1:17:36 it's very large and kind of abstract so i think it's and the security of this is 1:17:43 it's more similar to the way bitcoin works in general where it's 1:17:46 it's these incentives for miners and miners are in charge but i argue that they are in charge 1:17:52 in bitcoin anyway because they can reorder it can steal your money by reorging and they're 1:17:55 in charge in the lightning network because they can well they're they're not so much in charge 1:18:00 but they're bound by sort of the social community around bitcoin that in a way that they can't 1:18:06 really cheat yeah i completely agree that that's the wrong way of thinking about it we don't have 1:18:11 we have a game theoretic situation in bitcoin where it's sort of like a mexican standoff 1:18:17 where these different groups all have some power but they are checked by some other power and they 1:18:22 are in this in this in this sort of equilibrium with each other and so that is the wrong way to 1:18:28 think about it is that the minor this it's very reductionist to say the miners can just steal from 1:18:34 the yeah they can't they can't and it's not how anything works and that's like saying the police 1:18:40 can come and just take all your stuff which sometimes they do but you know like you know 1:18:45 that's all the i don't want to draw the conversation yeah that's a very specific 1:18:50 circumstance is there any oversimplified way of looking at the world and you shouldn't look at 1:18:54 the world that way and you shouldn't look at this project that way so and again i'm not saying that 1:18:57 it's perfect i'm just saying i think it's probably the best sidechain idea and probably definitely 1:19:03 worth your attention and worth trying so i'm glad that you asked that yeah i mean i i i'm 1:19:08 been excited about this project i i don't think i've hidden that at all and i i would like to see 1:19:13 it come to pass um do go read the bips they're uh they're going to be in the show notes and you can 1:19:20 go take a look at all of the stuff that paul's written um i i really do believe that this this 1:19:25 has the power to potentially change a lot of uh the way we look at cryptocurrency in general um if 1:19:32 it works the way we think it will um and and certainly um you know i mean we'll we'll learn 1:19:38 a lot more about what gives a currency value because at the very least it'll it'll answer 1:19:43 the question is a feature enough or is it something more than that and uh and yeah we'll we'll we'll 1:19:49 discover some of that who knows uh even if it doesn't happen on bitcoin i have a feeling somebody 1:19:55 somebody will hard fork internet sidechains or something to another bitcoin hard fork or 1:19:58 something so uh this is something that i think it's coming regardless yeah yeah that that would 1:20:04 suck hugely um if that's sort of what it would have yeah just we need more conflicts right and 1:20:10 more just weird yeah i don't know like this is one of those economic questions that i'm still 1:20:17 kind of like questioning is that are conflicts bad for bitcoin i'm not sure that the answer is no 1:20:24 so yeah well i think that's is a i think it's a nuanced question but the idea that someone has 1:20:30 the option of with a whole new set of miners new proof of work uh copying the you know the chain 1:20:37 history of bitcoin and then adding this feature that is kind of a very much an indication that 1:20:43 the miners are not in charge right because if it's a if it's if and only if it's a good feature 1:20:47 so if it's a good feature versus bad feature if it's a good feature the miners basically have to 1:20:52 add it or they can be like crushed by someone just creating a new spinoff that has a different proof 1:20:59 of work so but if it's a bad feature then they it's the reverse then they they must not add it 1:21:04 because yeah it's a step beyond UASF uh but yeah i mean more or less that's what you're talking 1:21:09 about is that the user that's very interesting that's what i'm saying is that the relationships 1:21:12 are not just like some guys in charge or something yeah yeah no it's it's definitely not hierarchical 1:21:17 it's uh it's more dependent in some sort of circular graph or something um anyway uh thank 1:21:24 you paul for for this very enlightening conversation we'll definitely have to do it 1:21:28 again uh thank you audience for uh for sticking with us for almost an hour and a half um i i 1:21:34 didn't expect this to go this long i thought it would be like a 30 40 minute show it uh it 1:21:39 certainly was a lot longer but anyway uh thank you everyone and uh this song is done