0:00 Can we talk about how crazy it's getting where people feel the need to change what they believe 0:19 or what they say based on this tremendous polarization of the communities where you 0:24 can't even just sit down at a table with someone without there being a kind of complicated 0:29 stressful drawing of boundary lines or something like that around the conversation. 0:35 So I mean, that's something that's really disappointed me that the community has split 0:41 and each side kind of writes the other off completely and I don't really support any 0:47 of that. 0:48 So that's one thing we could talk about, but we could just talk about anything. 0:53 Let's do it. 0:55 So yeah, I think the polarization takes too much of an extreme. 0:59 I think people need to look at the bigger picture. 1:03 At the same time, it's something we see in societies and politics across the board. 1:08 People like to get polarized and I think it's good to remind each other what we're really 1:15 here for and that really we have more things in common than not. 1:19 So we certainly shouldn't be that angry at each other, I think, in many cases and this 1:23 is really damaging everyone when we attack each other and, you know. 1:28 Yeah, well, I think that people do it because there's a reason. 1:34 It does work. 1:35 Well, as you say, first of all, it's just math, like if a bunch of people have a dispute 1:42 and one side gangs up and forms a big group, then the other side has to, you know, a well-organized 1:48 large group will just crush a series of smaller groups. 1:52 So you're doomed if you don't team up because teamwork is important. 1:57 But I think also it's kind of like the, it works for people, like an easy way to make 2:05 friends and to show people that you care about them, a very cheap way is of showing that 2:11 you care about other people is to make fun of their enemies, especially when the enemies 2:14 are nowhere around, you know, nowhere to be seen. 2:17 And so it does work a little bit. 2:20 In a strange way, you're right, this is an inevitable thing. 2:23 It's well documented that whenever there's not, if there's an external threat, people 2:28 come together. 2:29 But if you go long enough without a war, eventually, like it becomes internal again. 2:34 And that it's kind of depressing to see that happen to Bitcoin because I think there were 2:39 a couple opportunities for better ideas to just solve the problems. 2:45 But unfortunately, we just missed some of those opportunities, I think, a couple years 2:52 ago. 2:53 And then once it started to get very bad, it's now on an endless, I remember writing 2:57 in 2015, about July 2015 about this. 3:02 And I said, yeah, it started bad and now it's gotten much, much worse and it will only get 3:06 worse as time goes on. 3:09 And all kinds of people would tell me like, it can't get any worse than it already is. 3:13 And then it's like not even close, it's just continued to get worse and worse and worse. 3:19 That was way before Mike Hearn quit, it was way before Roger Ver splintered off with Brian 3:26 Armstrong and before the altcoin explosion. 3:30 So yeah, so I don't know how bad it can possibly get. 3:35 But definitely, why would it, you know, it won't stop getting bad until either there's 3:40 some kind of cooperation stimulus or some kind of force or something like that. 3:46 But these are kind of lofty thing. 3:47 I mean, I guess practical advice for anyone who sees this is to just try to keep in mind 3:55 how wrong everyone is about almost everything that they say and do just as human beings 4:00 and that we're all fallible and that you can use each community as a source of ideas 4:10 and of criticisms of ideas and that you shouldn't just give up on that because that is a valuable 4:17 thing. 4:18 And you're just giving up on science if you just kind of team up like this. 4:23 Is there something about maximalism and fundamentalism and all of that? 4:28 Let's get into maximalism next. 4:31 But I think before that, I think, so polarization does happen and this is somewhat of a natural 4:36 occurrence in human societies. 4:38 But I think if the danger there in polarization is people put on blinders and get tunnel vision 4:46 and the demonization and all these type of things is not really conductive to finding 4:54 truth, I think. 4:55 And what I would urge people to do is really try to think for yourself, have an open mind 5:02 and look at everyone's different views and see for yourself what makes sense. 5:09 And that's the part that worries me. 5:11 I think we all need to really be reminded of the bigger picture and actually look at 5:18 both sides and also don't just attack the other side, try to understand the other side's 5:25 point of view better and then learn something from it. 5:28 I think that is a greater goal. 5:31 There's a second thing actually that in a converse way, one of the worst things is that 5:38 it actually prevents real criticism from taking place because all the criticism that 5:45 takes place is just, you know, very low effort or sort of low brow. 5:50 And so, it then makes it so that something like, you know, I don't think that when like 5:56 now something like, I mean, there are a lot of examples but I think one salient one would 6:02 be the lightning network was when it was invented, it was just a really great idea. 6:08 But now, in one side says that it's this horrible thing that's invading and ruining 6:12 or doing something question mark and kind of not really totally fleshed out. 6:17 But then on the other side, it's held up as this thing that is kind of completely above 6:21 criticism of any kind and you don't, you really don't want anything to be above criticism 6:28 because that is what happened to the Roman Empire and Alan Greenspan and George Lucas 6:34 when he made the Star Wars episode one prequel, you know, everyone just thought they were 6:39 afraid to tell him that these ideas were bad, you know, because he was George Lucas. 6:44 And it's kind of similar, I mean, in a way, yeah, people criticize Blockstream as though 6:50 it's this horrible place but then on the other side, it's kind of like they can't do anything 6:57 wrong at all, you know, and it's like that is not a recipe for success, the criticisms 7:02 are good. 7:03 You want, not only do you want to not attack people but you actually want, it's no good 7:09 to have a bunch of supporters who are just mindlessly attacking the other side either 7:12 because they are preventing you from obtaining the knowledge that you need in order to continue 7:20 the process of improvement, so criticism is also good. 7:25 Criticism and optimism are good. 7:27 You want a lot of those two ingredients, those are very good ingredients. 7:32 I think you mentioned scientific thinking and it's not science if you don't allow yourself 7:37 to be disproved in some way. 7:39 And I think this is what we're seeing is also it's a lot of what I would associate with 7:45 cult-like behavior in that people group together, you know, the self-righteousness, the demonization 7:56 of the other side, you know, I mean, this in many ways is very damaging and we can all 8:00 afford to have a much more open mind. 8:02 I think the reason we're talking, we're kind of spending a lot of time on this and I don't 8:05 know, we have like no schedule and nothing is planned, this is all just whatever. 8:08 But I think, you know, this is a very deep mistake, you know, if there's some bug in 8:13 code or something, it can be fixed and so any number of people could fix it but this 8:17 is something that is very, it shuts off the pathway to correction for both communities 8:25 and it just stays off like maybe forever in the worst case scenario because something 8:32 else would happen that would be better, a better idea than Bitcoin or Bitcoin Cash and 8:37 I don't know what form that could take but, you know, it's definitely not impossible, 8:43 you know, it's definitely a possibility that something, you know, something using a totally 8:48 different strategy like Ripple could make inroads with something. 8:52 And I don't really believe that that is likely to happen but the point is if an idea stays 8:58 static for long enough, eventually some improvements will be made and if they can't make any progress 9:04 in either of the two communities then eventually, you know, it's only a matter of, you know, 9:09 you cannot sustain a static piece of technology for a very long time. 9:18 Let's talk about that. 9:20 You're famously known as a Bitcoin maximalist and, you know, my counterpoint to that is 9:26 I really, I think the most free, you know, we can be in such system as having a plurality 9:31 of choice and I think that different people are going to make different choices based 9:37 on their own ideology and I think that's really a positive thing that allows us to have a 9:43 free market of currencies and in many ways that's something we should aspire to, to, 9:49 you know, have confidence in the systems we believe in and, you know, believe that they 9:54 can compete. 9:55 I think that's incredibly important. 9:58 Yes, so I think I did write on my blog which is Truthcoin.info, I wrote an essay called 10:05 Bitcoin post-maximalism which is kind of an update, sort of like where I kind of say like 10:10 where did it, because it's still mostly believe it but I sort of am saying like it's a very 10:15 nuanced point so that's why you should probably read the whole thing but I kind of say like 10:19 is this point really faltering but the interesting thing about my version of Bitcoin maximalism 10:27 is that it was always paired to sidechains like very explicitly the whole time, you know, 10:33 since the idea was proposed in really in like December 2013 or something and kind of got 10:39 at steam and I didn't really kind of understand a lot of it until, but like the October 2014 10:46 paper from the Blockstream guys that kind of put it, made sure that it would be on the 10:52 map of people's thinking at least in 2014. 10:55 So my version was always paired with sidechains and, yes, I'm like a very Hayekian person, 11:01 I'm like super Frederick Hayek and like student of Karl Popper and all that kind of free experimentation 11:08 type thing. 11:09 So I completely endorse all of that. 11:10 I just assumed that we'd have this, you could make Bitcoin kind of universal and you could 11:15 let it just transform into other things and it would still be the same 21 million Bitcoins 11:19 but they could take any number of tradeoffs and it's surprising to me that that view has 11:26 ended up having a very hard time. 11:29 Many people subscribe to it in private or they come up to me like one-on-one or if I'm 11:34 just talking to them in a loud restaurant, they kind of endorse it and then they'll 11:40 have some kind of caveat like, but we should do it slowly and carefully or something like 11:44 that. 11:45 It doesn't really click for people. 11:47 The way it clicks for me is that this should just be number one priority. 11:50 We should have done this as soon as possible. 11:52 I don't know why everyone isn't just working on this, especially when scaling debate got 11:57 big. 11:58 You could have just said, well, grand compromise while the fees are still low, we'll make the 12:03 second thing and you can just jump ship if you want, whenever you want and then the problem 12:09 would have been solved. 12:12 And so, I don't see why it's not priority number one. 12:16 There's a lot of people kind of admit that it's, but there are various people have different 12:19 hangups like the fact that sidechains have a slightly different, slightly different like 12:27 way of working in that normal transactions are examined one by one by this script interpreter 12:33 but sidechain transaction has a sort of different thing where it's multiple blocks over a very 12:41 long time in a big sequence that is kind of used to check this. 12:47 So, it's just, I think also that various people were involved with them at a certain time 12:52 or something. 12:53 So, people have all these different, there's like a very long list of like six or seven 12:56 hangups that people have with sidechains. 13:00 But yeah, that totally tempers the Bitcoin maximalism for me. 13:05 I, in fact, I found myself fighting, I think kind of the same thing that you're talking 13:10 about where I kind of fight the idea, I almost want to coin a new phrase for it which I was 13:14 thinking like monochainism or something. 13:17 I was kind of trying to find what's a good phrase for this because I'm strongly against 13:22 that and I find that to be not only ridiculous but I just, it seems like how could it possibly 13:29 be the case that like everyone doesn't need to agree about everything and that is very 13:37 unreasonable and it's like people, no, nothing has ever worked that way, you know, like it's 13:44 like, okay, the people in, I don't know about the Eurozone is the best possible example 13:49 but theoretically, the people in the EU would, they would agree on all Europe related things. 13:57 Some people in like, you know, people around the North Sea would agree on like fishing 14:00 related things for that area and then people would agree on anything that affects their 14:06 country and then the people in, you know, here in Amsterdam would only have to agree 14:10 on things that affect the city and so, no one has ever agreed on everything kind of 14:15 globally with like a few exceptions on like, you know, property rights or something. 14:20 So that is kind of, you know, I'm against the monochainism and I think it's, but I'm 14:26 for there just being one system that manages the 21 million bitcoins because I think to 14:31 that extent, everyone does share a common interest but yeah, I don't, this is, everyone 14:36 has kind of gone crazy and the real rubric hidden beneath all of this is that you can't 14:42 tell like who has secretly invested in what and to what extent that is just totally coloring 14:47 their opinions which is, that is not a, that's an uphill battle to figure any of that out. 14:54 I think, you know, the vision you were describing and having these sidechains on Bitcoin and 14:59 that creating that freedom of competition and experimentation, I think in many ways 15:03 that's manifested itself across the cryptocurrency market as a whole. 15:08 At the same time, you know, I would have loved to have seen your ideas being implemented 15:13 in Bitcoin, you know, years ago and maybe that we haven't seen that happen is, you know, 15:19 I think that might point towards a failure of, you know, the governance of Bitcoin which 15:24 is exactly why, you know, we need multiple choices, you know, I wouldn't want, yeah and, 15:31 you know, and I wouldn't want to live in a world where we only have one choice because 15:34 that does not speak to me of freedom, that almost sounds totalitarian to me actually. 15:40 Yeah, there's a little bit more, I think it is equal parts irony and also a kind of inevitability 15:47 to it that if we just had this one thing then other things would not matter as much and 15:54 you'd be able to escape the one piece of software and just use a different piece of software 15:59 and if the piece of software that you fled to was terrible then that would just be on 16:04 you and this would be a totally, you know, internalized, privatized thing. 16:09 But I think there is a kind of inevitability to it as well which is that, well, yeah, I 16:15 think the timing, you're right, the timing matters but I think there's a kind of, not 16:22 necessarily in a bad way but a lot of the people who have been managing the Bitcoin 16:26 software are like, well, you know, do we really want to just throw it to, you know, 16:32 because we feel responsible for this, whatever this thing, you know, they say like whatever 16:38 it is, like we feel responsible for this giant multi-million, multi-billion dollar project 16:43 and we want it to do well and so we don't really want to just, there's actual, I've 16:52 actually gotten correspondence and even I think as a lot of some of it is even public 16:57 where people have said, well, you know, any sidechain that we add should go through like 17:02 the BIP process and should, you shouldn't just be able to just kind of unilaterally 17:10 add one or something like that. 17:12 And what's weird is that I even agree with that in some sense but I don't think it should 17:16 go through the BIP process, I think it should just go through a very slow, deniable process 17:21 because I don't, I think it is possible to, this is a kind of a very advanced thing but 17:27 I think it is possible for sidechains to sort of interfere with each other so you can 17:31 like start up a nation and then quickly declare war on all the countries and then just kind 17:34 of like steal everyone's Bitcoin and then shut it down or something. 17:38 But I had a different thing for that which is just to make it kind of slow which I think 17:43 is an easier response for that. 17:45 But yeah, I think there's, I feel there's kind of inevitability to it as well that people 17:49 just thought and people just, you know, it's very hard because there are so many factors 17:55 at play that it's hard to say to what extent which ones are big or which ones caused other 18:01 ones or something but, you know, I mean it sounds like I think we agree on this and so, 18:07 you know, I'm just trying to, you know, get a version together that is useful and, you 18:16 know, I plan on having a testnet very soon and I have, you know, I have actually a Bitcoin 18:21 core version and then I have a different version that just loads the Bitcoin cash UTXOs. 18:26 So even though it's, it doesn't really use any Bitcoin cash code but it is effectively 18:31 a Bitcoin cash version and I'd like to, you know, I hope that people kind of play around 18:40 with it because I think the idea is very, very easy to misunderstand and I think there's 18:45 just something about it that it's just kind of new. 18:46 I think, you know, this is, it's kind of an arrogant thing to say but I think in the same 18:51 way that Bitcoin was misunderstood very frequently, I mean all the people in, big people in crypto 18:58 really shot down, cryptography shot down Bitcoin because they couldn't figure out like how 19:02 many bits of security it had or something like that and even then a lot of people who 19:07 are into Austrian economics or something, they thought it didn't follow regression theorem 19:13 or some of these other things. 19:14 So it's kind of like, I don't know, I hate to just, you know, because any new idea could 19:19 be a terrible idea or a good idea and I think just it's easy to misunderstand things. 19:24 But I think that this idea, when you see the testnet, it will make it a little easier to 19:29 understand and also I think there's just so much vaporware in the space that if anyone 19:32 releases anything, people will just be like a little more, disproportionately more excited 19:36 about it. 19:37 So I'm excited for that. 19:39 This idea is sort of coming in testnet form and then I hope that more people will try 19:46 to think about how, you know, it might solve their problems because it can definitely solve 19:50 many of mine and a lot of other people's that I know and so the more people who feel this 19:56 is helpful, I think the better chance we all have of getting our problems solved. 20:02 So let's talk about that because I think there's a lot of misunderstanding about sidechains. 20:07 I don't know if you can help me understand that as well. 20:09 The way that I understand it currently is if we set up a sidechain, it does involve 20:14 a different trust model. 20:16 Yeah. 20:17 Yeah. 20:18 Yeah. 20:19 Yeah. 20:20 So. 20:21 Yeah. 20:22 But then you don't have the same guarantees per se that you would if it was on chain. 20:29 You know, I'm not actually sure if I, I think the assumption, the premises and the assumptions 20:35 and like the axioms I think are basically the same and I think the guarantees are really 20:41 the same. 20:42 It's just there's something in the middle is a little different. 20:44 So the way I have this set up is that it's very asymmetric so there's one chain that's 20:51 in charge of everything and then there are all these optional sidechains that are kind 20:54 of like more like plug-ins or something but since it's a devoutly asymmetric situation 21:01 so if you had a large block sidechain, for example, if you ran a full node of that, you'd 21:06 have to also run a full node of Bitcoin. 21:08 You'd have them together. 21:10 And so whenever you make a transaction from the side, from the original mainchain into 21:14 the sidechain, the large block in this example, the large blockchain would be aware of it 21:20 immediately because as far as it's concerned, this is just one big node that has two pieces. 21:27 So transactions go in are instant but then transactions coming out are instant and perfectly 21:33 successful and perfectly just as secure as regular transactions. 21:38 And then once you're in there, of course, there's this possibility of these atomic swaps 21:41 that are also instant and that have been kind of around for a while but haven't really taken 21:48 or you could use something like ShapeShift or something. 21:50 So it's just sidechains are very similar to altcoins in that you are using a completely 21:55 different piece of software that doesn't necessarily need to have any effect on the 22:02 base software that you're running. 22:04 So they're totally distinct, yes. 22:06 Right. 22:07 So but it's because it's so distinct, it is, like I was saying, a different trust model 22:12 in that sense and it's because you don't have a full proof-of-work network guaranteeing 22:18 the security and the incentives of that system. 22:20 You need to construct a different set of incentives and these might be better or worse but I suppose 22:25 my point is that they are different. 22:27 Yes. 22:28 So everything is basically the same except when you take money back and that is the interesting 22:34 aspect which is that if you want to take money, which you must be able to do in order for 22:38 this to kind of really not have too much, you know, just in order for this to really 22:44 be useful, they have to be as good as regular Bitcoin at least in an overwhelming sense. 22:52 So the, yes, so the, sorry, the, when the money is coming back, it is allowed to go 23:01 anywhere and that is what enables the sidechain to be ignorable. 23:06 And so you need the sidechain to be ignorable otherwise this all regresses to the same fight 23:11 it's always been over everyone agreeing on everything. 23:13 So it just regresses to the monochainism point. 23:18 And since it's allowed to be anything, it's allowed also to just be the wrong owners or 23:23 just the miners just taking it for themselves or something like that. 23:26 And so that is really the first hangup. 23:29 People have one of two hangups. 23:30 They say either it's, they think it's required, which it's not, excuse me, which it's not. 23:35 Or they say, well, then why wouldn't miners just immediately take the money and give it 23:39 to themselves? 23:40 And the answer is that it has to be, the process for coming back is very slow and laborious. 23:46 So you have to declare exactly where you're sending the money in advance. 23:51 And then you have to wait basically three to six months as miners upvote or downvote 23:56 this little thing. 23:57 So it's intended to be so difficult, it's basically like withdrawing money from Fort 24:02 Knox or something in the United States or just like something very, very, very slow. 24:08 And it will be apparent immediately to all sidechain users if it's wrong at any time 24:12 because you just, as soon as the withdrawal is declared, you just have one little hash 24:16 and you compare it to some other little hash. 24:18 And that is, then your computer will be able to warn you. 24:22 But again, it will only be able to warn you if you run the sidechain node. 24:26 So there is this kind of, this, there's a kind of an assumption built in that a few 24:31 people would care. 24:36 But even this is not a real assumption. 24:38 So anyway, let me finish my point, which is that this money is coming back and you, everyone 24:42 will know immediately because it's just one hash to another hash. 24:46 And someone might say, oh, this hash, you know, in order to figure out if the hash is 24:48 right, you need to run a full node or you could run the node in SPV mode. 24:51 There's lots of different, like, variations on this. 24:53 But the point is that the speed is so low and the, that it's just kind of... 25:00 almost impossible to believe that any, that a miner could like accidentally steal this money. 25:05 It's like, it has to be very, very intentional. 25:07 And this is a very slow thing that is very easy for humans to sort of check up on and make sure is correct. 25:13 And then if it's not correct, they can just kind of right click and UASF. 25:17 And then if the miner ever tries to follow through after the long period and actually steal the money, 25:23 then they can just say, I reject that. 25:26 And of course, but you see, there's a kind of, there's a lot of other layers to this, 25:32 which is that if we need the freedom to experiment with terrible ideas that have it so that we can't, 25:41 no one can figure out what's going on on the sidechain, at which point the miners might as well take the money. 25:45 And so that is a desirable thing. 25:47 And we also need the ability to kind of clean out sidechains that are kind of not worth it. 25:55 So it's kind of like you, you have the freedom to visit like a bad webpage on the internet. 26:01 So you don't want, it's, there's a kind of a shades of gray aspect to it where you want, 26:07 you don't want there to be like some website on the internet that just disables the internet itself. 26:13 So you don't want to visit a website that will shut off your internet connection as you reach a contradiction there. 26:19 But you also don't want anyone like kind of curating the list of possible websites for you to visit, 26:24 because you don't necessarily even know yourself which you do want to visit. 26:29 So the security model is different, but I think if you assume that miners are selfish 26:36 and that they want the price, they want to earn the most money in mining reward, 26:40 the sidechain gives the miners transaction fees. 26:43 And also by giving new abilities to the Bitcoin coin, 26:47 they make their own, the 12.5 that they currently earn every 10 minutes. 26:53 They make that have a higher purchasing power and it's more valuable token for them. 26:58 And they, that is what drives their incentives more than anything, because they, that hits them completely. 27:04 They have to pay out in, to buy electricity, they have to spend fiat. 27:09 And so they're buying like Bitcoin call options basically in effect, 27:12 and they really want Bitcoin's price to go up and not to go down. 27:19 See, that's the other thing is if miners allow, you know, sidechain theft, 27:24 or the sidechain ecosystem doesn't work out, then the price of Bitcoin may go down in that world. 27:31 So it's, there's a lot of, it's sort of like, it is a little bit different, but it's just kind of like, 27:39 again, I do think it's similar to original Bitcoin where it's like, oh, okay, well, maybe some, 27:43 why would the miners mine on the longest chain if they can make more money by just mining on a chain by themselves, 27:48 or they would get together with their friends and double spend or something. 27:53 And, you know, and I'm not asking anyone to really believe in it either. 28:00 I think people should try it out and watch other people try it out and just see if it works. 28:05 It may not work, but I think, you know, I don't think people really appreciate what it would take for a theft to take place. 28:11 It would take 51% of the hash rate, and it would take, for 51%, it would take the whole six months, 28:16 because it's, if you have 100%, it would take three months. 28:20 But it would take a long time, and it would be obvious to everyone. 28:23 And it'd be plenty of time to, like, decide, you know, what to do about it, if anything. 28:27 And this cannot be spammed. 28:29 Like, you can only do this once per sidechain. 28:31 But this would depend on a specific security model of that sidechain. 28:35 Well, yeah, I have what I have in mind, but anyone could change it to do anything else. 28:44 I kind of hope that everyone would do a similar thing, 28:47 so that the sidechains are maximally kind of intercomparable with each other, 28:51 so that an attack on one sidechain would be construed as an attack on all of them, 28:58 which I think would make it a bigger disincentive to... 29:01 That would limit experimentation. 29:03 No, only in the, because the gate coming back, I don't intend anyone to really even use. 29:08 In fact, the people who use it may all be miners themselves, 29:12 because you have, in one direction, it's super simple and infinitely secure, 29:19 just as secure as any other transaction. 29:22 So in the one direction, there are no problems whatsoever. 29:25 And then you have the atomic swaps, and you even have Lightning Network, 29:29 which is identical across all sidechains and altcoins. 29:33 So you have these atomic swaps that you can easily, 29:37 you could have someone move 100,000 Bitcoin over, 29:40 and then buy and sell them with other people in exchange for on-chain Bitcoin, 29:45 and with the normal security assumptions of that just the node is working, 29:49 and that the network is on, then you still get everything. 29:53 And then if people want to sell, they can sell for like 99 cents on the dollar 29:59 to like these kind of investment banker types who will collect all the money 30:02 and then slowly walk it over during these slow withdrawals. 30:07 So I don't anticipate anyone even really using the withdrawal part. 30:11 It's just to establish the peg's existence beyond any of the, you know, the... 30:19 And people will potentially stay in the sidechain in the same shape. 30:22 Yeah, I think, well, it could go in a couple of ways. 30:24 If people stay in the sidechain or leave, I would imagine some people, 30:30 if people want to leave, my point is there should be a liquid market 30:33 for these atomic swaps for them to leave, 30:35 because anyone can make a tiny investment return. 30:39 Yes, but some people may, there may be specialists who go over to a sidechain, 30:46 and then they offer services or they create some kind of payment channel-like thing. 30:53 And so you can use the service of the sidechain just by kind of going through it, 30:58 even if none of your Bitcoin are over there. 31:02 And so those people, if there's not enough Bitcoin on some sidechain, 31:05 people might deposit some and then do that and charge a higher fee 31:08 and get some kind of return that way. 31:10 So one of the problems that I see with sidechains and also state channels 31:16 is that it does add complexity to the user experience, 31:20 is that this is adding steps, you know, to this. 31:23 And I think this also depends on your view on scaling, 31:26 but I mean, I think that we can scale on chain or at least keep up with demand. 31:31 So in that sense, I think that Bitcoin needs to compete with systems 31:36 that can, you know, fulfill a lot of these functions simply on chain, 31:39 which is a better user experience and can also be very cheap. 31:45 You know, and in that sense, I don't see, I mean, don't get me wrong, 31:49 I see a lot of use cases where sidechains and state channels are actually great, 31:53 really very useful for specific use cases, 31:56 but this definitely does not cover all use cases. 31:59 And I think user experience here is very important. 32:02 And one of the advantages of cryptocurrency 32:07 is that a blockchain represents a type of neutral platform 32:12 that, you know, everyone around the world can do business with. 32:15 And if we start to set up these interconnections and interrelationships, 32:21 then we could face a lot of the same problems that we have in current legacy systems. 32:26 Currently legacy systems, technologically, they could work very well, 32:29 but the reason they don't is mainly due to politics 32:32 and, you know, organizations not wanting to work together, 32:34 not wanting to trust each other. 32:36 And now that we have a blockchain, this neutral platform 32:40 that allows everyone very easily to transact and to communicate 32:44 and not to require trust. 32:46 But once we start stacking layers on top of that, 32:48 we could start seeing problems of these systems connecting to each other again 32:53 while also worsening the user experience. 32:57 Lightning actually being a great example of that, 32:59 where, you know, you need to load into a hub, 33:02 and then these hubs might not want to connect with each other 33:04 for different political reasons, 33:06 in many ways re-applicating the problems that we have in current financial systems. 33:11 But of course, this does depend on your view on scaling. 33:14 I'm personally, I think we can scale on chain 33:16 and therefore it'd be hard to compete with that. 33:18 But obviously, if I'm wrong about that, 33:19 then sidechains and state channels are obviously the way to go. 33:23 Well, I think, yeah, you said a lot of things there. 33:25 But I think one is that the large block sidechain, 33:29 if you just run large block sidechain, 33:32 and then you, as I explained earlier, 33:34 you'd have to run the tiny block mainchain in this setup. 33:39 But, yeah, once you have that, 33:40 then it's really no different from having just a large blockchain in general. 33:46 You just have everyone using, you know, 33:48 Roger Ver is giving away money on that chain, 33:50 and then he gives people that mobile app. 33:54 And then it's basically the same user experience. 33:56 So I think the sidechain user experience is the same 33:58 if you're not moving around as, 34:00 and it would be on one large blockchain, 34:04 large block blockchain, so it would be the same. 34:07 But in terms of a UI perspective, I don't quite see that working 34:10 because to have a wallet, let's say, 34:12 and you have bitcoins in that wallet, 34:14 and that bitcoin exists in a sidechain, 34:17 it would be very confusing to users to label that as bitcoin 34:20 because you cannot transact directly to another bitcoin address, 34:23 which, again, which is the kind of complexity that I'm talking about 34:26 that creates those problems. 34:28 Yes, I think you're right about that, 34:31 but you could send directly to another address within this thing. 34:34 So you'd call it, you could call the sidechain, like, 34:37 a gigachain or something, and it would have a giant, 34:40 it would have gigabyte blocks or something. 34:42 And then, but everyone would just, you know, 34:44 Roger Ver would just tell everyone to, in this hypothetical, 34:46 you know, I'm sort of speaking for fun here, 34:48 but he would just tell everyone to use that app 34:50 or the family of apps that uses that system. 34:54 And then it would be the same. 34:56 I mean, it's no different, I think, from the situation it is with altcoins today, 35:00 where it's like, within the altcoin, 35:03 there may be many apps or one or two 35:06 that interface with the user, 35:09 and moving among different altcoins is difficult. 35:14 But, you know, it used to be impossible, 35:15 and now it's much easier than it was before. 35:19 Like, I'm kind of shocked, honestly. 35:21 I mean, Shapeshift is very easy to use. 35:23 A lot of the payment processors now integrate with many different coins. 35:29 You know, you can have one where it's like, 35:30 oh, we take Bitcoin, like Coin Monero, Bitcoin Cash, et cetera. 35:33 So I don't think it would be that different. 35:38 I do agree that the user experience is important, though. 35:43 But, yeah, I think these things are hard to say. 35:48 I mean, you say, like, it depends on your belief 35:51 if Bitcoin can scale on-chain. 35:54 But, again, like, the Hayekian view that I like 35:58 is that you set in very much the Nassim Taleb view, 36:02 which is that you try to set up the world 36:04 so that it doesn't depend on whether or not you know something, 36:06 because knowing things is just too difficult. 36:09 And so you just say, well, you know, the sidechains, 36:12 like, we try it. 36:13 You have the sidechain, the large block sidechain. 36:16 You turn it on, and then, oh, like, oh, that didn't work. 36:19 But then you figure out why it didn't work. 36:20 Oh, maybe it's easy to fix, or maybe it just does work, you know? 36:24 Maybe there are no problems at all. 36:25 Or maybe, I presented it at Scaling 3, 36:28 I was like, maybe the fact that you just have both of them, 36:31 it's like a Mont and Bailey defense 36:33 where people would build this kind of tower or castle, like on a hill, 36:38 and then they would have, like, a kind of other thing 36:40 where they would mostly hang out, like in a field. 36:43 And that's where they really wanted to be. 36:44 No one wanted to be in the tower. 36:45 This is, like, in whatever, the 500 AD era. 36:49 And you would want to hang out in the large block place 36:53 where the fees are cheap. 36:54 But then if someone tries to attack all of the nodes, 36:57 then you just retreat to the tower and shoot with giant longbows 37:02 at these people, you know, until they leave you alone. 37:05 And then they leave, and then you go back out. 37:07 And so, this is kind of like a strategic synergy between the two. 37:10 I'm not sure if that's a desirable situation to be in 37:13 if we have better alternatives. 37:16 Well, I don't know. What do you mean by that? 37:17 Oh, I mean, in your analogy of having to retreat to the tower 37:20 and shoot down the people in the field, 37:23 I mean, all of that could be avoided. 37:24 It's a small block chain. 37:26 Right, you know, I understand. Yes, I understand. 37:28 But then, you know, like, if, like, you know... 37:31 If people attack, it's better than not having a tower. 37:35 But I think for a lot of people, like, and, you know, I think... 37:39 I think the design, if Bitcoin were to really succeed 37:42 in terms of the vision of Core, 37:44 like, transaction fees would have to become very high. 37:47 I think at current scale, you know, more than $100 per transaction. 37:51 And I think that creates a type of inequity 37:53 where not everyone can afford to move into the tower. 37:56 And even furthermore, not everyone can fit in the tower. 37:59 I mean, I believe for everyone to do a single transaction on Bitcoin, 38:04 it would take a century for the entire world to do one transaction. 38:07 So I don't really see that the gate is big enough to save those people. 38:12 And I think a lot of the plebs are going to be stuck in the field and shot down. 38:15 It's quite the analogy here. 38:18 I... Well, that's not really what I mean, is that that's close. 38:21 But by staying in the tower, I mean that Bitcoin itself is still alive 38:26 and everyone's money is just kind of on pause. 38:28 So the large block, I'm imagining something that, you know, 38:32 this is the disaster painted by the core people, 38:36 is that there's only like five nodes and they're all in a data center in China. 38:39 The Chinese government rolls in and says that you have to like do X, Y, Z or whatever. 38:43 And so the Chinese government rolls on in and they say, 38:50 you can't do this or you can't do that. 38:52 And then, or just you have to shut all this off. 38:55 And so my defense is that instead of the newspaper headline being 38:59 China destroys Bitcoin completely, Chinese government number one, 39:04 you know, whatever was so great. 39:05 Instead, the headline is just Chinese government makes Bitcoin much more expensive to use. 39:11 Some people find that very annoying, you know, 39:15 and then the conversation is just about how they are doing something that is directly inconvenient, 39:21 but not even really achieving a good purpose. 39:25 And so that's kind of what I mean. 39:27 I think to me that's somewhat of a false dichotomy in that, you know, 39:31 this idea that we'll only have five nodes that govern the network, 39:33 that's certainly not something I would advocate for, right? 39:37 And I don't know whether or not it's accurate or not, 39:40 but I'm just saying this is the, again, this is the Hayekian thing. 39:44 So it's like, okay, well, if that happens, do we have some plan for that? 39:49 Then okay, then there you go. 39:50 There's your plan. 39:51 So works for everyone. 39:54 Well, I think there's a middle ground that can be struck here as well, 39:59 because like something, actually I'll introduce an idea here, 40:01 something that I always found to be a lot more realistic to establish for Bitcoin is 40:07 if we just simply just established a minimum specification of like, 40:11 you know, what should be the minimum specification to run a full node? 40:14 Like realistically, like today, like you can run a Bitcoin full node for like $5 a month pretty easily. 40:22 And I think with eight megabyte block sizes, that's $10 a month or, yeah, yeah, yeah, yeah, yeah. 40:32 Yeah, and I think in that sense, I think, you know, being realistic, 40:36 if we say let's establish a minimum specification. 40:38 So let's say just an average computer with an average connection in the developed world. 40:42 I don't think we should expect, you know, poor people in the third world to run full nodes. 40:46 That doesn't necessarily seem to be the correct priority here. 40:49 I'm more happy to enable SPV wallets for, you know, the disenfranchised of this world. 40:55 Yeah. 40:56 Well, I think that that question is linked to the other question, which is how people feel about SPV. 41:04 And again, I kind of feel very fine with it. 41:08 So this is actually very interesting. 41:09 So first of all, I wrote a cool blog post that a lot of people liked. 41:13 It's very long in my characteristic style on Truthcoin.info, but it's called Measuring Decentralization. 41:18 And I concluded that the best, this word is very vague. 41:22 And I was like, what does this word mean? 41:23 You know, because that was another point of contention. 41:25 And I was like, this is not going to get anywhere if no one has a definition for this word. 41:28 So I said, let's define it as the cost of your option to create a new full node and then start using it. 41:36 So it's basically what you're saying. 41:39 And so that's, so we should have some, if we care about decentralization, 41:44 we should be able to define it and measure it. 41:46 And people should really care about the measurements and the definitions. 41:49 Very suspiciously, many people do not. 41:52 They say they care about decentralization, but then it's like saying you care about, I don't know, 41:59 chemistry, but you don't keep track of the elements or you don't, 42:02 you never build a microscope or from biology or something. 42:05 So that aspect is very interesting. 42:08 But then the SPV aspect is also interesting because people say, well, we never built these fraud proofs, 42:16 but I actually also did a very recent blog post about that, 42:19 which is very, very long and very complicated about how I think you might be able to do these fraud proofs 42:27 that no one has been able to disagree with yet. 42:30 But just to your point, at the bottom, I'm like, I don't know if anyone really even needs this 42:35 because seriously, like when's the last time that, you know, 42:40 there's asymmetry for those of you who don't know in SPV mode where almost all of the work, 42:48 99.99% of the miner's effort goes into this thing that you can check in like two seconds 42:54 and then validating the block is this much longer task. 42:57 And, you know, that's a very clever, I find that to be a very clever design and a very good asymmetry. 43:03 And it's like wood, if miners want to get paid, they should run the node. 43:09 What's the percentage of the node cost relative to the other capex that they've put in? 43:14 You know, wouldn't they just... 43:16 And then the other thing on top of that is that there's a dichotomy between... 43:23 Miners is a word that describes actually a couple of different people, but mainly two groups. 43:27 The hashers who are just cranking out the SHA-256, 43:31 but then there's also like these pool operators that kind of decide what to do 43:34 and then they just pass a tiny amount of information, you know, 43:39 whatever it is, like 200 kilobytes or something or not, it just, yeah. 43:43 And so it's like those are the people who need to run one node, you know, 43:49 in exchange for being the pool operator and having a brand of that to try to attract these hashers. 43:58 And it's an environment that is, you know, it's like textbook perfect competition 44:02 and anyone can just show up and there's no barriers to entry for this. 44:06 So you show up and establish a brand, you'll be raking it in and you want to defend that brand 44:10 that you don't miscalculate the block and invalidate all the miners' payments. 44:15 But then people say, oh, how will we ever know? 44:17 Like, why would the payments ever be invalidated if no one is checking? 44:20 And then you say, well, some people will check and then it becomes kind of a crazy thing. 44:24 I'd like to touch on that, Ikshin. 44:25 I think, Ikshin, you defined as hashers and pools. 44:27 I think I'm using the definition miners and pools, 44:30 but it's the same things, the semantic difference there. 44:32 But I think this is something that a lot of people forget because there's a lot of talk 44:36 about if we increase the block size, it increases mining centralization. 44:40 And that is categorically wrong. 44:44 The sense in which people mean that, that ship has sailed a very long time ago. 44:48 There was like one mempool shared by like 70% of the miners as of like early 2014 or something. 44:55 Like that ship has completely sailed. 44:58 But in a good sense, Sergio Damon Lerner was one of the earliest to point this out 45:03 and no one would really listen. 45:05 And this ties into all kinds of other crazy things. 45:09 But there was this phenomenon of block orphaning. 45:13 Everyone should, it's very instructive and fun. 45:15 If you go to blockchain.info charts, which are very fun, but you can check out the orphaned blocks. 45:22 You'll see as blocks got bigger, there was suddenly this problem of the blocks being orphaned. 45:27 And that, it's hard to very quickly explain what's going on there, but the miners don't 45:32 like orphaned blocks because they mined a valid block, but then they lose all their 45:35 money for it. 45:36 So they, because they happened to be found coincidentally at the same time as someone 45:39 else and just no one checked. 45:41 So this started to be a big problem. 45:43 But then eventually you reach a point where block size continues to increase, but then 45:48 this problem just basically just completely goes, falls off a cliff and goes away. 45:51 And then now no blocks are really orphaned almost ever. 45:56 And that is because of this phenomenon of SPV and spy mining, where all of the miners 46:01 are actually plugged into each other's pools and they will, as soon as someone finds a 46:07 new header and clicks the new miners over to it, everyone will click over to it immediately 46:12 without, before they explicitly check on it. 46:16 But they do implicitly check in the fact that they are still working on, yeah, they do implicitly 46:22 check in the fact that they assume that since these other miners have been driven to, you 46:28 know, the other pool administrator has decided that they are going to start working on this. 46:35 That is a kind of indirect evidence that you should at least work on it until you have 46:39 checked for yourself, which is like 30 or 40 seconds. 46:41 So this problem doesn't really happen anymore. 46:43 But yeah, mining centralization is another thing that it, unlike decentralization, which 46:50 I tried to define, basically no one has risen to the challenge and defined miner centralization 46:55 in an acceptable way to me, other than this very boring sense in that miners like talking 47:02 to each other or something like that. 47:04 If I'll just explain that a bit more. 47:06 I think that like the reality of Bitcoin today is that there's 20 to 40 pools. 47:13 And I don't think that's going to change because it's simply just how variance works. 47:17 Now, considering the scale of mining, these pools can afford to run full nodes, essentially. 47:23 And, you know, exactly. 47:25 And this is, yeah, exactly, exactly. 47:29 And, you know, and this is why, like as a miner, like I run some miners from home, it doesn't 47:33 matter if they are one megabyte blocks or one gigabyte blocks as a home miner, you're 47:37 actually not affected by this. 47:40 And that's exactly. 47:43 And yeah, exactly. 47:44 Yeah, exactly. 47:46 Yeah, so I think this has been a very false narrative, I suppose, that's been going around. 47:51 But node centralization obviously is a different issue entirely. 47:56 But I would actually just hop back, actually just tie back to what you're saying about 48:00 sidechains. 48:01 And, you know, one of the gripes maybe I have with Bitcoin now is that, you know, it's failing 48:07 to adopt, you know, good changes in the code and, you know, because just changing a one 48:12 to a two, I think would have been an acceptable compromise. 48:15 And introducing your concept of sidechains, I think, would have been a very amazing experiment 48:20 to see, you know. 48:21 And this is something that maybe shows flaws in the way that Bitcoin itself is being governed, 48:27 you know, from a GitHub, you know, currently, and the kind of governance philosophy around that. 48:31 Yeah, well, maybe, but, you know, I think, I think a different thing, okay, all right, cool. 48:38 But yeah, I think a bigger thing is just the lack of interest, because, you know, I've 48:41 been working on and tinkering with the sidechains technology and code over time. 48:46 So it's been improving. 48:47 And so then it's even still not even the testnet. 48:49 But I do find it, I find a weird apathy that I can't, can't really fully explain it. 48:55 I have a lot of theories, but I suspect if you went to something like Ethereum or Bitcoin 49:01 cash, that'd be far more welcoming to your ideas. 49:04 Well, it's been an absolute. 49:08 That's cool. 49:09 It's been an absolute pleasure talking to you here and really enjoy your work and thank you.