0:00 Over time, I've just become more skeptical of it, and this talk is just a recap of things that I've just like said on Twitter and things, 0:06 but I've tried to organize it in a little way, and I'm going to try to shoot through it in 10 minutes, 0:10 so we have as much time as possible and make myself very vulnerable to getting a question from someone out there. 0:16 So I just think this is a bad idea, and it's a big waste of time. 0:21 This is it in a nutshell. So the channel's idea is not workable. 0:24 There's not enough block space for 1% of the Earth's population to really use Bitcoin via Lightning. 0:31 The channels themselves are difficult to operate and maintain. They have a poor UX. They're unreliable. 0:36 It matters who you open a channel with, so that steers us away from the cypherpunk world where everything is just like math, 0:43 and it steers us back towards this world of brands, and you have trust and reputation. 0:47 The cost-benefit ratio of the channels, it doesn't meet the standard of acceptability. 0:54 Point two is demonstrations of Lightning working are basically fundamentally rooted in a misunderstanding, 1:00 so a lot of the testimony comes from laypeople who are easily duped, and they don't realize what they're seeing, 1:05 and their testimony is worthless. The payment networks have big network effects, 1:09 and so the winning payment network will be used by a lot of people, 1:14 and if it's not used by a lot of people, then it's just not going to be used by anyone, I think. 1:18 A lot of the Lightning insiders have already been abandoning it over the last few years. 1:22 I'm going to have some quotes about that. The hype is very social, 1:27 so the Lightning idea was born out of the block size war, and it is inherently propaganda, which is nothing against it. 1:35 I mean, George Orwell wrote this essay about all art being propaganda, but that's not the point. 1:39 What I'm trying to say is that it will never be free of this baggage that it has, 1:44 and all these political associations and these loyalty associations. 1:50 I mean, I'm just going to keep going to try to get through this super fast. 1:54 This is important, though. I'm going to spend time on this slide, and then I'll probably try to just shoot to the last, 1:58 but I'm just letting you know, this is what I experienced personally, so this is why I've come to hate this idea. 2:04 I'm just going to read all this, though. It's important, so I'm sorry about this long slide. 2:08 In May 2015, we got Tadge's here. I love Tadge. He's great. 2:12 I don't blame Tadge for this, and neither should you. 2:15 This isn't his fault. This is everyone's crazy case. 2:18 Is Tadge in the room? 2:19 He's right there. 2:20 Okay, good. 2:21 He's directly in front of me. He's making this as awkward as possible for me. 2:27 But I saw their talk on YouTube. 2:29 But here's the thing, Tadge, is that I noticed that throughout the year 2015, 2:33 the year of the block size war, and the year of people on Reddit, r slash BTC, hating each other, 2:39 I noticed that this video never had more than 350 views in that year. 2:43 So this led me to think, the people who argue about Lightning, they actually haven't watched the video, 2:47 and they probably don't really know anything about Lightning. 2:49 Maybe they all read the 80-page PDF instead of watching the YouTube video, but probably not. 2:57 Okay, December 2015, Scalene 2 in Hong Kong. 3:00 Everyone was like, Lightning is the best. 3:03 Soft forks are the best. Scalene layers. 3:04 All that is true, and I agreed with it at the time, and I was very excited about this 2016. 3:10 I released, I posted a technical variant that works with this peer-to-peer oracle I had designed. 3:19 And so I had researched it enough to know how it worked in 2016. 3:23 And so it's not like I'm unfamiliar with it completely, even though maybe my knowledge is a little old. 3:27 But then this is where the problem started. 3:29 It was in February 2019, I was at a Bitcoin meetup in Mexico, and there was a huge group of people. 3:35 Everyone was thrilled with Blue Wallet. 3:38 Like every single person, there are hundreds of people, and there's big groups of people, 3:42 and they're like, oh, Blue Wallet is the best thing. 3:44 And I downloaded it from the App Store, even though I would normally never do this peer-pressure download on a phone. 3:49 But I was like, I just couldn't resist. 3:51 And then a person next to me sent me eight Satoshis. 3:54 And I was kind of like, huh, that doesn't really make any sense, 3:56 because like I didn't open a channel or like what's going on. 3:59 So then I asked the room, like, is it custodial? 4:01 And this, I was with like a huge group, this is 25 people, 4:04 this is only a small subset of this group of Lightning enthusiasts. 4:08 But they had no idea what the question even meant. 4:10 Like they didn't even know what custodial, like what the word meant. 4:13 And this led me to believe that many of the Lightning supporters are dupes, 4:17 so they don't realize what they're saying when they say that Lightning is great. 4:20 So then I posted this thing on the mailing list in February 2022. 4:25 And then it led me to write this article in April 2022 called Lightning Network Fundamental Limitations. 4:30 It had all these points, and it did go at the large Miami BitDevs that was next to the conference. 4:35 It did get like brought up and discussed. 4:38 But at no point did anyone drop like a huge article that went like point by point 4:43 and said this is why all this is wrong or doesn't matter. 4:45 Everyone just kind of like quietly accepted it. 4:48 And so this led me to believe that even though experts in the mailing list crowd, 4:52 they can't show us how Lightning Network would work at scale. 4:56 And I did fundraising for the company LayerTwo Labs, my own company. 5:00 I had one slide out of like 60 slides about how Lightning like doesn't work 5:04 and we deserve better and we could easily do better. 5:06 And people had like a very strong emotional reaction to this slide. 5:09 And a lot of people advised me to just take the slide out. 5:12 And this led me to believe that a lot of people are getting funding 5:15 based on how much they just conform to the Lightning ideology, for lack of a better word. 5:22 And then really it started to get going when Barack, who's supposedly a genius, 5:27 I think he probably is a genius, but all these people are saying Barack is the smartest person, 5:31 maybe even smarter than you. Two people, two different people told me that. 5:34 And he's like this genius at Blockstream. 5:36 He crashed the Lightning Network like twice for fun, recreationally. 5:41 Then when he invented ARK, he didn't say like, oh, this is like a trivial modification to fix lightning. 5:45 His quote was, I've always been a big critic of lightning. 5:49 I had severe objections, right, from inbound liquidity to inbound receiving interactivity. 5:54 I wanted with ARK to address the inbound liquidity problem, 5:57 but I really couldn't find a cure for it. I failed to see lightning scaling. 6:01 So I was like, OK, well, this is like the smartest lightning guy saying that it's not going to work 6:06 and that his own idea is a significant departure from it. 6:09 And in April 2023, I presented at MIT about an unrelated thing, 6:14 but I saw someone else's, this is a very senior person, lightning person's talk. 6:18 They talked to me in the hallway afterwards and they said they have all these problems with lightning themselves, 6:23 but they feel uncomfortable bringing it up and they have been disinvited from speaking about lightning 6:29 based on the tone, like if they don't have like an optimistic tone on lightning, they don't. 6:32 This is an extremely, extremely senior lightning person, like is at the top. 6:39 And then in March 2024, I collected all these quotes. 6:41 They published Ellen Blackbill. And again, I don't really get like a huge response. 6:45 So this is like how this is kind of like what is leading me to where I am now. 6:48 I'm kind of just like this is ideas. 6:50 But I'm going to try to get into a little bit of the little bit of the details. 6:55 Okay, good. We're only like four minutes in. 6:58 What is the lightning idea? 7:00 It is this idea that you have these bi-directional channels, two people equals one channel. 7:05 And instead of Alice paying Bob, Alice can find like a route through this like six degrees of Kevin Bacon concept 7:12 that probably you know someone who knows someone who knows the person. 7:16 And instead of because the payer wants to pay because they want to buy something 7:21 and the receiver wants more money. 7:23 So those parts are fine. But how do you get it? 7:25 How do you use these channels that belong to these other people 7:28 and you make use of the HTLC or something similar? 7:31 So that that is to my in my opinion. 7:34 This is like what the lightning network idea is. 7:38 And the problem is that the channel idea and the HTLC idea are they're very, 7:42 very good ideas at the time. They represent brilliant research in 2015. 7:47 And I was very excited about them. But in practice, they don't work. 7:51 And I wrote this piece as I tried to explain. 7:55 This is the beginning of it. But like the channel part basically says we have very realistic assumptions 8:01 on how you onboard yourself to lightning by opening a channel 8:05 and how many channels you probably need in your life and how long will they last. 8:09 If you have these realistic assumptions, even these assumptions are pretty optimistic that I took. 8:14 It takes like 121 years to onboard eight billion people, which is too long. 8:19 And if the channels only last a year, of course, 8:21 some people have a channel that's lasted a very long time, like more than two years. 8:26 But every time you need a channel, you like you have to go back to the drawing board 8:30 and reopen, reconsumed L1 block space again. 8:33 So if every channel only lasts one year, 8:36 you have to roll the whole thing over and only like 0.82% of the Earth's population 8:40 can actually use Bitcoin via the lightning network. 8:43 And then I had like a part about do the channel factories help? 8:46 It turns out they don't because they're extremely fragile. 8:49 One saboteur can crash the whole thing and force you to go back to L1. 8:55 The HTLC idea also doesn't quite work because it expands the size of, 9:00 it depends on how you count it, but basically two transactions you need 9:03 in order to actually have the money and buy something with it. 9:06 They increase the number of bytes that you must use. 9:09 And this is a catch-22 because when the fee rate on the L1 blockchain is very high, 9:14 the HTLC is so expensive that it's better off if you just don't use it at all. 9:18 And the lightning network part is useless. 9:21 And then when the fee rates are low, you don't need to bother with the lightning network 9:25 because the fee rates are low. So it's a catch-22. 9:29 And then as I mentioned, I published this other article 9:32 unrelated to the lightning limitations article. 9:34 I just collected all these quotes from people. 9:36 First one is from Taz. He did a great interview on what Bitcoin did. 9:40 And even at one point the guy, Peter McCormick, is like, 9:44 wow, this interview is really not like the normal lightning interview 9:47 of like everything's perfect. This is like a really sober interview. 9:50 And he tried to right the ship six years ago. 9:55 But we're still here doing this for some reason. 10:00 So yeah, it's like lots of quotes. 10:02 And then I noticed other people have made similar lists. 10:05 I found this list. This is someone else, David Shares. 10:07 I don't know who this is. I think it's a Bitcoin cash person. 10:09 But the point is he has this list on GitHub. 10:13 And it's just like link after link after link after link. 10:17 And there's this—it only has 122 subscribers, 10:20 but there's a Telegram group that's called Lightning's Best Moments. 10:24 And I just picked out like a couple random days. 10:26 This is like January 27, January 28. 10:28 This is not like me cherry-picking. I just literally scroll to random times. 10:31 But it's like discussion of a bug that can be exploited to lock up funds. 10:36 Stuff nobody seems to know about lightning. 10:38 I'm working on some new code. The L&D nodes are stuck payments like this. 10:42 Obviously, everything has been rebooted and upgraded. 10:45 You know, money is trapped. 10:46 Albi appears to be geoblocking Israel. 10:48 This is something of the functioning self-sovereign 10:51 that makes my funds hard to access. 10:53 Someone is using HTLC expired over 3,000 blocks ago to like whatever. 10:58 So like these are all just like funny little things. 10:59 If you're running L&D older than 18.5, 11:02 stop what you're doing and upgrade immediately. 11:04 Thieves are draining funds using exploit. 11:05 So it's just like, you know, 11:07 it's just like a huge bulletin board of just like kind of funny things. 11:12 And you know, none of these problems exist with other L2s. 11:17 Yeah, this is—I wrote this tweet. 11:18 This is a reaction to the Fiat jobs creator of Nostr. 11:22 And he's—this is him in 2023, two years ago. 11:27 Lightning is a scam. 11:28 It is scamming Bitcoiners out of their time and energy and money for six years. 11:31 I'm not saying that because he said it's automatic. 11:32 I'm just saying this is back—this is the timeline 11:36 of when I wrote this tweet about problems with LN onboarding. 11:39 There's channel risk. It matters who you open the channel with. 11:42 Liquidity. The HTLCs don't work. The routing is difficult. 11:46 Custodial Lightning. I'll get to that. 11:49 So again, like I don't know like but maybe this is the day. 11:52 I don't like, you know, I've never seen like the big like knockdown response to all this. 11:56 So then I just quickly try to get through these other points. 11:59 These are not like serious points. 12:00 These are just like but, you know, Lightning derangement syndrome. 12:05 Lightning doesn't work. And then if you tell the truth about it, 12:07 then people get very defensive and then they just become very nasty. 12:10 But as a result of this, Lightning gets out of criticism. 12:13 A lot of people are just not comfortable saying things 12:16 or at least they weren't for many years. 12:18 And as a result, we're all lying to ourselves. 12:20 Someone at this conference two years ago basically said like that. 12:25 Well, I don't want to dox the person so but they basically said that. 12:30 Custodial Lightning. This is the stupidest idea in the universe. 12:34 Imagine getting it. You get in a driver. There's Waymo. 12:36 But there's a human driver in the front seat 12:39 and he drives you to your destination like with his hands and like with his eyes. 12:42 It's like using the turn signal and everything. 12:44 And then as you leave, the guy says Waymo is the future of taxis 12:48 because a computer can drive cheaper and safer than any human driver. 12:53 You would just think like, I can't, you know, 12:55 there's nothing I can even say to this person. 12:57 This person is so stupid that I'm not even going to bother like 13:00 explaining to them why this doesn't make any sense. 13:02 You would just say, oh, yeah, thanks. 13:05 You know, see you later. And you would just leave. 13:08 The custodial idea means that you involve trust. 13:12 It means all the proof of work, blockchain idea, the key, 13:16 the user sovereignty over the keys that you roll the randomness. 13:19 So all that is just out the window. 13:20 So it's kind of like, but a lot of people defend this idea. 13:26 The problems with Lightning are not like normal problems 13:28 that you'd have with a new idea, which is like we hired the wrong guy, 13:33 but he had a bad work ethic. 13:34 So we fired him and that set us back four months. 13:36 Or the idea is new and our customers aren't used to it yet. 13:39 The ideas in Lightning Network are like at the core of the idea. 13:44 They're like, hey, everyone, I just noticed it's possible to attack the channel 13:48 by doing complicated thing XYZ. 13:51 This attack imposes a new cost or risk on the channel owner, aka the user. 13:56 And we can fix the problem with like wacky solution, whatever. 13:59 But like these flood and loot, liquidity, whatever, all this stuff. 14:02 These those are the problems with Lightning. 14:04 So these are each time one appears, it's like bad news 14:08 because it means how many more are lurking around the corner. 14:10 This is the kind of thing we were used to make fun of in Bitcoin. 14:13 Like 2015, 2016, we made fun of people saying like Vitalik will fix it 14:19 or Dan Larimer with BitShares, he would change it. 14:21 He'd put out like some complicated thing. 14:22 Someone would refute it. He'd change it again. 14:25 Now we just we accept in Lightning this kind of thing 14:28 that we would never have accepted in shitcoins in 2015. 14:32 So we that's how far we've fallen. 14:35 But yeah, I think yeah. 14:36 Okay, let's try to get to say this is basically the end. 14:39 So this is the end. 14:41 So just trying to say like this is Theranos. 14:44 Like it has the appearance of success, 14:46 but really it was a scam the whole time. 14:47 But like 10 years in it was reaching a 10 billion dollar. 14:51 So it's very easy for something to I'll just skip though. 14:55 Simulation. Okay with Drivechain BF300. 14:58 I have code that simulates 8 billion users using it. 15:02 But in Lightning you can't even begin to do this 15:05 because it's not even possible. 15:07 And then these people are talking about this. 15:09 This is the last slide. 15:10 So I'll just this is like you have to decide 15:12 which of these two theories you kind of endorse. 15:15 There's one where channels work. 15:18 They're the future of Bitcoin. Engineers will solve the problems. 15:21 In my theory, they don't work. 15:23 It is no longer good use of your time. 15:25 Engineers are playing pretentious games to win OpenSats grants or whatever. 15:29 Okay, then the orthodox view is like 15:31 that I'm here to FUD Lightning and shill Drivechains 15:34 and I want more clout or something so that I can get BF300 activated. 15:39 The truth is that Tidwell had to practically drag me here. 15:41 I almost didn't come. Booked the flight like last week. 15:45 And LN is going to collapse because it doesn't work. 15:48 And BF300 does not need code changes to core 15:51 and it will activate because of its effect on minor revenues and other things. 15:56 So that's not the case. 15:57 But the orthodox view would be that all Bitcoin and Lightning 16:00 has all these smart and nice people and everyone can't be wrong. 16:02 The truth is Lightning is from the block size war 16:05 and it inherently has this propaganda dimension that it cannot get rid of. 16:10 People are emotionally unwilling to admit they were wrong. 16:13 And it's like, well, I invented my own Lightning technology in 2016. 16:16 Maybe that's because my knowledge is very now obsolete. 16:18 That's completely possible. Someone could say, 16:21 well, we just invented the such and such and now Lightning works. 16:24 But I think the alternative explanation is that it was early both times. 16:28 It was early to join and early to leave and you'll be joining me eventually. 16:31 Okay. So there you go. So let's try to sprint through that. 16:35 But now I'm giving much more than, 16:38 I'm giving three times the amount of time to the Q&A section. 16:42 So that's making myself very vulnerable to anyone's questions. 16:47 So as someone who's worked in custodial Lightning for six years, 16:49 I'm highly offended. 16:53 So I would ask, please someone break the ice. 16:56 I'm asking people to be brave, break the ice. 16:58 And no, no, do not raise your hand. You come up. 17:01 So if you want to talk, queue up right here. 17:05 I want to bring you on. And then if you want to just write a topic on the whiteboard 17:08 and not be on stage, but make sure we cover it, 17:10 you can come up here right on the whiteboard. 17:12 You can go up and you can be third. Pause right here. 17:16 All right. So Paul, we'll kind of co-manage this. 17:21 Yeah, I think you should just do whatever you think the audience appreciates. 17:23 And also if you are done making your point or you're done, 17:26 you can self-exodus yourself off the panel 17:30 if you don't want to wait for me to get it to you. 17:31 Okay. Now it's on. Hey, hey Paul. 17:36 Thanks. I mostly agree with you, which I'm shocked to say. 17:39 Yeah, so we got one. I just want to I thought about doing this. 17:41 I thought about really making myself vulnerable by having like a tally of like 17:44 how many people will come up and they say mostly agree with me. 17:47 That's another prediction I had. Here's the thing though. 17:50 You're mostly right and you're still wrong because Lightning is a massive success. 17:56 It's the only successful scaled second layer in basically blockchains worldwide. 18:01 It's it actually works amazingly well. 18:04 It just doesn't do everything it was sold to do. 18:06 And so you can knock it down correctly by saying that it over promised 18:10 and it did not deliver on every single promise that people thought it was making. 18:14 And most of that as you as you said in talking about Taj is 18:16 that the promises weren't actually written in the Lightning paper. 18:20 They were made by other people. Lightning does what it said on the tin 18:23 and it does that amazingly well. It routes payments. 18:25 It scales the payment throughput of the network. 18:27 It does not really scale very well the user throughput of the network 18:31 and that is something we still need to solve 18:33 and things like Ark and Spark and others may be able to solve that. 18:37 But yeah, it's not that Lightning failed. 18:39 It's that some people not the authors of Lightning lied about it 18:43 or miss misinterpreted what it could do. 18:46 Yeah, and in particular I think Taj is was very honest 18:49 and when I say the Lightning cult, I always say Taj is not in the Lightning. 18:53 It always surprises people. I say that but I say it all the time. 18:56 I'm sure Taj is thrilled that I talk about him so often. 18:59 But I just like to point out that basically what he said was just now 19:02 is that Lightning is not going to be the thing that scales Bitcoin to 8 billion people. 19:07 That's exactly what I was saying. 19:09 I think the question of... 19:11 That doesn't make it a failure though. 19:12 But I think the criteria for success is unrelated to the promises. 19:16 So I don't care about what was promised. 19:19 I'm just saying this idea is not... I'm just saying it's about the future. 19:22 This isn't about the past 10 years. 19:24 This is not the thing to invest your time in. 19:26 But you made a specific claim, which was that Lightning will collapse. 19:30 And I'm making a character claim that Lightning will continue to thrive 19:33 in doing what it does, which is scaling numbers of payments 19:36 between entities who are on the Lightning network. 19:38 It's amazing at that. It'll not stop doing that. It'll keep doing it. 19:42 I don't think it will do that. 19:44 What would defend that claim? 19:45 Your claims so far have defended that it will scale to users. 19:48 This is why I had the Venmo me point that I didn't quite get to flesh out. 19:52 But the payment networks themselves have network effects 19:56 in addition to other things. 19:59 Just for formatting, make your point very clear before dialogue. 20:03 So make the point that you either agree with or want to debate specifically. 20:08 But I'll just finish. 20:11 Like when people say Venmo me some money or something, 20:13 or they say, you know, like give me a Kleenex or Xerox or Tweet or whatever. 20:18 It becomes a verb. 20:20 The payment networks themselves, like when something else is used by most people, 20:24 it will crowd out the other things. 20:26 And eventually that the one thing that scales to 8 billion people 20:29 will be what everyone uses. 20:30 They will not use some tiny little thing that uses, 20:34 you know, it's very much like the TCP IP analogy 20:37 where of course there are these other things, but it's not like. 20:40 I'm going to admit myself when I have to say this. 20:42 Do you use Fedwire? 20:46 Well, I don't know how to answer that question. 20:48 I have sent a wire before. 20:50 I guess I don't use the Fedwire moves reserves as a completely different question, 20:54 but let's move on to the next question. 20:56 Yeah, so I think the lightning is what we need to actually scale Bitcoin. 21:01 So we're never going to get 8 billion people on the main chain. 21:05 We are going to need some form of way for anyone to receive and send transactions. 21:12 Also, main chain fees make it very limiting for people in poor countries to actually use it. 21:19 With lightning, you can have one channel that's run by someone 21:24 and multiple people can use to actually transact with minimal, 21:29 if not no fees at all. 21:32 This is actually not true though. 21:35 How so? 21:36 I explained why there's not everyone can't open one channel. 21:39 Not in practice. 21:41 Not everyone is a channel. 21:43 Just like a bank. 21:44 But also the premise that we don't need to scale to 8 billion people. 21:47 I mean, that's what I'm here to talk about. 21:50 So again, if you're just going to admit defeat, 21:54 then like I'm talking about of all the technologies that will scale us to 8 billion people, 22:00 lightning will not work. 22:01 And furthermore, one of them will work and then it will just crowd out the other ones. 22:06 It will just stomp the other ones to death. 22:11 Just passively by doing nothing. 22:14 I'm going to twist a little bit here. 22:16 So I mean, I think there are two things that you don't have on your list 22:19 that I'm very concerned about. 22:22 So I'll start off with, I do agree it's not going to scale. 22:25 I do believe that it will at some point will be a niche 22:29 that some people will use for very specific purposes for very specific communities. 22:34 But you know, so I'll agree with you in that evaluation. 22:39 But my bigger concern is that it's very much a distributed technology 22:46 rather than a decentralized technology. 22:48 It is very vulnerable to network effects that will encourage centralization 22:53 of payment channels with various parties. 23:00 It's really hard to fix this. 23:05 And then I'm also very concerned about the persistence requirements of lightning 23:12 which I think it's everything from the fact that Blockstream will say, 23:16 well, we don't want to do identity and yet their lightning store 23:25 has the same identity that it did seven years ago when they launched it. 23:30 That's identity even if you're saying you're not doing identity. 23:34 So these kind of persistence things are going to have lots of opportunities 23:41 for denial of service, for various other different types of out of the protocol problems 23:51 if they become economically important. 23:53 Yeah, I completely agree and there's not enough time. 23:55 This is like the fastest I've ever created slides, like slide per minute ratio 23:59 because I just had so many ideas in my head about like what to say 24:02 about how lightning is a terrible idea. 24:04 There was a recent tweet from like a lightning CEO who basically said 24:07 we have to just give up on payments and self-custody or something. 24:11 And I was like, okay, well, like there you go. 24:13 But I just want to also say about the gentleman in the middle about, 24:17 you know, I completely agree that we need to scale in layers 24:21 and that everyone will not be on L1. 24:22 I think that has nothing to do with the lightning network at all. 24:24 And in fact, the fact that the lightning network has parasitically brainwashed everyone 24:29 into thinking that L2 equals lightning network is by far the worst thing about the lightning network. 24:35 By far. 24:37 Real quick, Danny, if you can respond in closing statement and then we'll have you off. 24:41 Yeah, I mean, I think that somebody in, for example, Africa will never be able to, 24:45 let's say Kenya or something like that, will never be able to do an L1 payment anyways. 24:50 And yeah, maybe there are some other layer twos that are going to be better, 24:55 but what we have now is okay. 24:58 And maybe in the future, we're going to switch to something else. 25:01 I don't think lightning is the end goal, but it's good enough for now. 25:06 That's my guess. 25:09 Hi, Paul. When we first met, I don't know if you remember, but I introduced myself to you as your biggest hater. 25:16 Yes, I think I remember seeing a tweet that says a helpful tool fails and dies or whatever. 25:22 But I do have to say that after meeting you and talking to you more and doing some more research, 25:28 I think one of maybe the bigger points I would make in favor of something, say, like drag chains is that 25:38 lightning is, as you said earlier, it's almost a little parasitic in that it doesn't really have a good solution for the long-term security budget of Bitcoin. 25:49 Yeah, I also wanted to have a whole slide about this, and there was just a bullet point that I skipped. 25:54 But the mind versus non-mind L2s, that was one of the giant tweets that I had of 10 points. 26:00 That was one of the points. And I'd like to also emphasize, 99% of all new ideas don't succeed at all. 26:06 And for any new idea to work, you need to do everything perfectly. 26:12 If you could be a person and you could starve to death or you could drown or you could get executed, 26:18 you could get framed for a crime and then killed by the government or something. 26:21 So there's lots of ways of dying and failing, and you need to do everything perfectly. 26:25 And this lightning just has many of these things, each of which would kill the idea. 26:30 And another point I would make is that although blockchains are a bit of a panopticon 26:35 and securing additional blockchains against Bitcoin with drag chains could result in lower privacy, 26:41 allowing the possibility of 256 different options for people to use for scaling Bitcoin stats, 26:52 one of them should have the capability to use, say, zero-knowledge proofs or something. 26:58 Yeah, we have one already. We have a clone of the Zcash Rust crate library inserted into one. 27:04 This sounds like a commercial now. 27:07 So that could have more privacy. 27:10 Real quick, real quick. Let me cut you off. 27:12 Is there anything that you disagree? 27:15 Is there any specific point that is a friction with Paul's framing and context? 27:21 I don't disagree with Paul at all. 27:23 All right. I want to ask you to wrap up. 27:27 All right. 27:29 Paul, I want to challenge your entire central assertion that lightning is going to collapse on itself 27:35 because payment networks need network effect. 27:38 Lightning has established itself as the uncontestable king and central point of that type of network effect. 27:45 Its existence and the very use of HTLCs or PTLCs or any of these other constructs 27:51 allow it to interlink with any other system that supports these type of capabilities. 27:55 And you already see in the development of other Layer 2 systems like state chains with Spark, like ARK, 28:02 that their entire design goals are doing exactly that. 28:07 Pivoting around to interlinking with the lightning network 28:10 because it is the existing network effect that can actually cross multiple systems. 28:15 It has the network effect now out of all the other terrible ideas that have been coming out. 28:20 But that's not on its merit. 28:23 There are about 9 trillion or so transactions per year by everyone on earth. 28:29 As far as I could tell. I tried the best I could. 28:31 But obviously lightning is like 1 billionth of 1 billionth of 1% or whatever of that. 28:36 We're talking about Bitcoin payments. 28:39 Yeah, but I'm talking about all the payments. 28:41 So this is what I'm talking about the future payment thing that actually succeeds. 28:45 And the fact that it's currently bigger than some things now, that doesn't really mean that it will... 28:53 It's bigger than everything else. And that's exactly how network effects grow. 28:57 What is the most established network effect is what people gravitate towards. 29:02 And that is the process by which that thing's network effect expands 29:06 and creates a larger incentive for people to participate in that network 29:10 versus attempting to bootstrap something new. 29:12 We are already demonstrably seeing this with other Layer 2s. 29:16 Even if this were true, that it's the biggest, it's number one, and it will continue to grow forever, 29:21 and runaway network effect, it has to hit a ceiling as I already explained. 29:25 It hits the ceiling at the L1 channel opening. 29:28 Lightning itself doesn't have to be the thing that end-users interact with. 29:32 We have things like Spark. We have channel factories. 29:35 We have basic channel factories like ARK. 29:38 I'd like to address the point about everyone saying that, oh yeah, like, 29:41 effetiment interactivity with lightning. 29:43 Every other Layer 2 in existence on Bitcoin right now is either designed to be 29:49 or does support atomically linking into the Lightning network. 29:53 I'd like to address this point, which is every Layer 2 that exists right now. 29:56 This is all related to what I told you before about when I was doing the fundraising. 30:00 A lot of people have invested in Lightning startups, and they want some narrative 30:04 that this is going to help their Lightning. 30:06 It's not a narrative. It's demonstrable facts. 30:08 It's further evidence of what has become to be overt fraud and basically just social pressure 30:14 on people to sell the narrative that Lightning is working. 30:17 And it is not evidence of the merits of Lightning. 30:20 The users who use Lightning, they don't even realize they're using custodial Lightning. 30:24 The whole idea is just a sinking ship, and it is not actually working. 30:28 Paul, Spark users, ARK users, Liquid users, on-chain users, all of them, 30:33 every single one of those things can factually right now page other through the Lightning network. 30:40 Every single one of them. 30:42 All right, all right. 30:44 And it's just early days. 30:45 Funny enough, I feel like I was listening to both of them, 30:47 even though they're both talking at the same time. 30:49 Somehow, the voices are so much different. 30:53 But I would say, real quick, I know you had a quick question. 30:58 Let me hand it to Stu real quick. 31:00 Hi, Paul. 31:01 Obviously, I agree with everything that you said. 31:04 Great, thank you. 31:06 But my question is, if you hate Lightning so much, 31:09 then why is it cited in the BIP301 to do Blind Merged Mining requests? 31:17 I was originally enthusiastic about it, 31:19 and there is a way to do half of the Blind Merged Mining completely off-chain, 31:23 and I thought that people would like that option. 31:27 And so that is for Blind Merged Mining, not BIP300, but in 301. 31:32 I think Blind Merged Mining, I don't know. 31:34 At one point, there was one guy who didn't like, 31:37 but everyone, I think BIP300 is where all the controversy was. 31:40 Blind Merged Mining is too simple, and since merge mining already exists, 31:45 I don't think – there was one guy who didn't like 301, 31:48 and then he came around and he said, I like 301 now. 31:50 So that was – 301 is the more popular one, and it's optional. 31:54 One of the two optional ways to – 31:55 But you've got to rewrite the BIP. 31:56 To just like delete it maybe. I don't know. 31:58 Yeah, you need to fix it. 32:00 Doing more damage than it's – 32:03 Okay, that was it. Thanks. 32:11 So somebody asked me to watch one of your videos 32:15 and critique everything that you had said, 32:18 because I happen to like lightning. 32:20 And I watched it, and everything you said was wrecked. 32:25 Yeah, I get this sometimes too. 32:26 But I haven't actually – 32:27 People email me and they say, I didn't know. 32:28 I'm an engineer at a lightning company. 32:30 After I read your blog post about it not working, 32:32 now I kind of understand how it was supposed to work for the first time. 32:36 And I've been working full-time for years as a lightning engineer. 32:40 So my question is, what if we come up with a way 32:45 that we can have custodians without trust? 32:49 Yeah, I think the idea – 32:50 One thing that I defended in something in 2015 that I wrote 32:54 about measuring decentralization was that lightning, 32:58 it wouldn't matter if it became hub and spoke, 33:00 because you can always just cash out and switch hubs. 33:05 But it turns out that that was too optimistic. 33:08 But that was what I originally thought would be how lightning actually did work, 33:13 because, of course, there were many large blockers at the time 33:15 complaining it should be hub and spoke. 33:17 And now in practice with the custodial lightning, it's very hub and spoke. 33:21 It's actually so hub and spoke that even the things connecting to the spoke 33:26 aren't even there, so it's only a hub. 33:30 So I originally liked that idea a lot, but in practice, 33:34 I don't think it will be competitive with what will be coming down the road 33:39 in terms of both BIP300, my own idea, but also these other things, roll-ups, et cetera. 33:45 So I've been working on a proposed protocol 33:49 that would have cryptographically verifiable ledgers in channels, 33:55 and I'm trying to scale this idea out because there's no UTXO per wallet. 34:03 So if it works in a trustless way, it should scale to everyone. 34:08 The key, I think, to getting the scaling to work is 34:11 people have to be able to share a UTXO without updating the UTXO on L1. 34:15 And so sort of CTV was on the right track with that, 34:18 ARC is on the right track, and BIP300, my own idea, are on the right track with that. 34:22 And, of course, the custodians do that all the time where they just say, 34:25 well, we own this UTXO, and we say that you have $10 here, 34:30 and hopefully we'll give it to you in the future. 34:32 Is it wrong if we just say that there's never a UTXO, 34:36 and the goal is not to let you exit to the chain, 34:38 but just to make sure that you stay inside the system? 34:41 I think this is related to what Reardon or whoever that was, 34:44 Sunglass Guy, was saying about me not using Fed. 34:46 Like, we don't use— 34:48 You weren't supposed to dox them. 34:50 In the payments, everyone's been doxed. 34:52 If you come up here—no, I'm just kidding. 34:54 If you have a pyramid where we pay each other, 34:59 maybe with Venmo—Venmo has a commercial bank, 35:02 Wells Fargo, Bank of America, or something. 35:05 You have this—they settle amongst each other with the Federal Reserve, 35:10 which is like a bank of banks, 35:12 and then there's the Bank of International Settlements, 35:14 which is like all the different Federal Reserves of the world have an account there. 35:17 So there's this huge pyramid, and I think it's correct to say 35:20 that we live on layer four of the fiat world, 35:23 and we don't really go—we don't have reserves. 35:25 We never have any bank reserves, which only the Fed has, 35:28 and we never have any Bank of International Settlement money, 35:31 whatever the hell that's called again. 35:33 May I ask real quick, any specific, concise follow-up, 35:37 and like a closing sort of logic, 35:40 and then after this, I want to go to a closing with Shinobi, and then— 35:45 I mean, finance in general has problems, 35:49 so I feel like if Lightning has some problems, that's still okay. 35:53 I think the question fundamentally is 35:55 whether we can scale to eight billion people, 35:58 and if we can do something on Lightning to do that, 36:02 does that solve the problem? 36:06 Well, I mean, I just don't think it will work, 36:10 and it will be dragged down by network effects, as I've said. 36:13 Like, people like to use what their friends are using, 36:17 and that's just really strong, 36:19 and the fact that like one millionth of the Earth's population 36:24 maybe whatever it is, 8,000 people use Lightning today, 36:28 and that it's currently number one on the leaderboard of like a bunch of terrible stuff, 36:31 again, this is also not related. 36:33 Like, Lightning has crowded out the other worse stuff, 36:37 because the people behind, you know, 36:40 people who are enthusiastic or invested in Lightning, 36:42 either emotionally or financially, 36:44 they don't want something else to come out 36:46 that will just reveal that this has all been a ten-year waste of time. 36:48 So it's related. 36:50 The fact that Lightning is number one on the tiny leaderboard is partly a result of that. 36:55 So your biggest fan, Shinobi, is going to give some closing thoughts, 36:59 and then he can cue back up if he needs. 37:01 You just keep saying things. 37:03 Like, saying it will get dragged down, 37:05 and the network effect will implode is not an argument. 37:08 It's not a reasoning for why, 37:10 and the empirical reality right now is that 37:13 that network effect is strengthening with every other system, 37:17 like Arc, like Spark, like Liquid, 37:19 that is connecting into the network effect of the Lightning network 37:23 and making it larger. 37:25 Like you said, that everybody wants to use the thing that everyone else is using. 37:29 As more and more of these systems connect into the Lightning network, 37:33 all of these different systems effectively become the same system, 37:37 because Lightning glues them together, 37:39 and that is a runaway snowball effect that will reinforce its network effect, 37:44 not drag it down. 37:46 I'd like to point out that... 37:48 Oh, nice, we've got two people to applaud for that. 37:51 That's great. 37:52 Hey, I'd like to point out that eight people just came up here 37:54 and said they agreed with me completely about everything. 37:56 We set that against the two people who just clapped. 37:59 I think that the idea that... 38:02 Again, this is the emotional thing of Lightning. 38:05 It's like people have dug in for ten years, 38:07 and now this is... 38:09 The network effects are not... 38:13 They're not on the merits, 38:15 and to the extent that Lightning draws people in, 38:18 it's just wasting everyone's time, 38:20 because it's just, as you heard, other people agreeing with me. 38:22 It's just not going to work. 38:26 Two quick, concise things. 38:29 For your point about HTLCs kind of occasionally maybe not working 38:35 for reasons of taking up size and costing money and such, 38:41 are these problems assuaded by using something like adapter signatures, 38:46 which have the same size as normal transactions? 38:48 I know it's not the only point. 38:50 Yes, there are many things. 38:51 This is a very good point. 38:52 It's a very fair thing to point out, but it's also frustrating. 38:55 People can say, oh, there's HTLCs, but then we'll use PTLCs, 38:58 or we'll use whatever, such and such thing. 39:00 This is what I was trying to get at with the slide 39:02 about the problems being to the core of the idea, 39:04 where there's... 39:08 Eventually, people might come up with a way. 39:10 That's what I was trying to say a few points ago, 39:12 where if you can update who owns the UTXO 39:16 without broadcasting bytes to L1, 39:19 or either minimizing that or ideally making it zero, 39:22 that would be an idea that works. 39:24 I think that's more of what these other ideas, 39:26 including ARC, are trying to go for. 39:28 In my opinion, that just is too different from the Lightning Network 39:31 for Lightning to then later claim victory that, oh, we can handle these problems, 39:34 but people working together for 10 years on a team of 200 39:39 super high IQ people eventually came up with new ideas 39:42 that patched it all up. 39:44 That wouldn't really count for me. 39:46 My second point was actually really much on this topic of... 39:51 I just wanted to push back on the title, 39:53 that it's a waste of time and developer energy, 39:56 because I think that it's actually been extremely beneficial 40:01 for people to be thinking in this mode and related modes 40:05 and to develop solutions to all these problems that keep popping up, 40:08 because they aren't unique to Lightning. 40:11 I personally just think that it's kind of like, 40:15 even in a future where Lightning just completely doesn't work, 40:19 I think a lot of good will have come out of it 40:21 and a lot of the development on the research that happens with Lightning. 40:26 I'll go until I physically collapse and cannot speak anymore, 40:30 but we have the schedule, so I don't know if... 40:33 Are we ruining the schedule with this? We're going over or what? 40:35 I'll go forever. 40:37 No, no, no. We're good. Keep going. 40:39 We're good for another 20... 40:41 Yeah, yeah. I was just genuinely clapping to Nadav's great response. 40:46 I thought you were trying to wrap it up or something. 40:48 No, no. I'm participating, too. 40:52 All right, great. I'm glad we have way more time. 40:55 I'm glad that a lot of people get a lot... 40:58 I've heard this also, where people say, 41:00 well, I like Lightning. It's like, okay, great. 41:03 Okay, I guess I specifically just meant the premise 41:08 that this is a waste of all of this developer energy. 41:10 But don't you understand what I mean by that? 41:12 I mean this is not the best idea out of the pile. 41:17 Okay, but it's not one idea. 41:19 PTLCs are useful for a lot of non-loading protocols. 41:23 Yeah, and it is... 41:24 Any idea we try, people will learn a lot and it will be... 41:27 And I did write a different thing about 41:29 people thought fraud proofs are impossible. 41:31 In 2016, an article saying that only via payment channels 41:35 or the Lightning Network are fraud proofs possible 41:38 because you need some way to get the word out about a block 41:41 without it being... 41:43 But anyway, I'm just saying that. 41:45 So I think that it's true that as... 41:47 I think Chris Rowland, doxing everyone now, 41:49 as he said, there will be some things where 41:53 the technology has a very targeted, specialized use, 41:58 but it will not be the way people pay each other Bitcoin, I think. 42:01 And I think that's what everyone assumes that it is, 42:04 especially people like Peter McCormick, 42:06 especially regular, normal people 42:08 wandering around a Bitcoin conference. 42:10 So I would consider it a win if everyone just said yes. 42:13 Lightning is an extremely niche thing 42:16 that will be used by very few people in the future. 42:21 If that's what people are going to say, 42:23 then I'm happy to agree with that. 42:26 So I want to challenge the assumption that you stated 42:31 that one big payment system on top of Bitcoin 42:36 will take over or will have the maximum network effect 42:39 and everyone will be using it. 42:41 I want to challenge it on two time frames. 42:43 One is the next 10-20 years. 42:46 I don't think we know which system is the perfect one. 42:51 We haven't figured out... 42:53 We haven't even explored the whole design space of Bitcoin yet. 42:56 So I think over the next 10-20, maybe even 30 years, 42:59 we'll continue to explore different designs, different trade-offs. 43:04 And during that time, Lightning will be... 43:07 HTLCs, PTLCs, we don't even have to talk about Lightning. 43:10 Some interoperable payment standard will be vital to Bitcoin. 43:15 In the long term, I could imagine that what you're stating is true. 43:18 I don't know if it will be true. 43:20 There might be different trade-offs. 43:22 One, privacy. 43:23 Other people might prefer more scalability. 43:25 And I don't know if we can find all of that in the same system. 43:28 But I'm less sure. 43:29 But in the short term, like 10, 20, 30 years, 43:31 I think we still need Lightning or something similar. 43:33 Well, I completely agree that we need the L2s again. 43:35 I'm pro-soft fork. I'm pro-innovation. I'm pro-L2. 43:40 I started the company LayerTwo Labs. 43:42 It's the company name. I have the domain. LayerTwoLabs.com. 43:45 And the Layer2 is great, 43:48 but Lightning has tricked everyone into thinking that it's the only L2. 43:52 So I completely agree that we will have... 43:54 And that's why I even brought up a few times the criteria for a good L2 is 43:58 it pays the miners' transaction fees so there's no target war. 44:03 There's no misaligned incentive. 44:05 And the other thing is you have to update who owns the claim on L1 44:10 without using the L1 bytes. 44:13 And that is why the channel opening idea and the HTLC idea, 44:18 those both consume L1 bytes. 44:20 So it's fundamental to the idea. 44:22 It's not like, maybe we'll... 44:25 It's too early to tell. 44:26 It's not too early to tell. I mean, I can tell. 44:29 I could tell in 2022. 44:31 But do we have any better system that allows interoperability 44:35 in a way that not every new system that we're building... 44:38 The interoperability is... Well, not to interrupt, 44:40 but I'm just trying to say that the interoperability is itself 44:43 a claim that the network effects will crush everything. 44:46 So it's like, when something works, people... 44:49 You're interoperable with that one thing. 44:51 So if BIP300 takes off, then... 44:54 And there's 14 geographically distributed L2 blockchains, 44:58 like what I predict, 45:00 then you'll be interoperable with the one that is in your area, 45:04 like the North America one. 45:05 And everyone will be interoperable with the L2 they use. 45:07 And if Arc takes off, or if whatever takes off, 45:10 you'll be interoperable within the one that you use. 45:13 You know what I mean? 45:14 I'm kind of pushing back against the interoperability word. 45:17 I'm saying that it's really network effects is what it is, 45:20 because the interoperability will always be clunky, 45:24 because it will always be kind of hard to make Arc, 45:27 Lightning, everything like all... 45:29 It would just be easier for people to just use the one that works. 45:32 And this is all Cope. 45:33 All of that about interoperability is just a way of bolting on 45:37 some attempt at a genuinely new idea onto Lightning brand, 45:42 because the Lightning brand is undefeated. 45:44 Hey, by the way, we light teen to put you in a good mood. 45:48 So we're going to convince you that light teen is at least a good idea. 45:52 I feel better already. 45:54 But closing statement and point... 45:57 I think we don't know which system will be scaling Bitcoin to billions, 46:01 which system will be the best one for privacy, scalability, 46:04 all these things that we want. 46:06 If we don't have interoperability now, 46:08 then we risk settling on something suboptimal 46:11 just due to network effects. 46:13 That's why I'm a big fan of Lightning. 46:15 That's why we just did the first Arc to Fetiman transaction 46:19 like two months ago in Riga, 46:21 and it just worked without the teams having talked to each other. 46:23 That's the beauty of Lightning, not end-user payments. 46:26 Thank you. 46:27 Okay, great. 46:29 A couple of quick statements and then a question. 46:31 I think it's unfair to characterize Lightning 46:33 as having brainwashed people, 46:35 especially over the last year or two 46:37 where all the other L2s that you've already mentioned, 46:40 BitVM and Arc, 46:43 and even Fetiman and Cache stuff have really started to take off. 46:46 Before we were all tweeting about OpReturn, 46:48 we were tweeting about OP_CAT and OP_CTV, 46:50 and these Layer 2 structures are being built with these opcodes 46:54 either being required, 46:57 or at least Lightning's not the only L2, 47:01 and to say to characterize Lightning as brainwashing people 47:03 and that it's the only L2 I think is unfair. 47:05 Well, luckily, after I wrote my article in 2022, 47:08 people finally, we had the Bitcoin Season 2 idea, 47:10 and everyone started to do a Lightning limitations panel, 47:12 which is the title that I use on my blog. 47:15 And so then, after I, 47:17 someone who's not even a Lightning developer, 47:19 after I wrote that thing, 47:21 I'm not trying to claim 100% of the responsibility, 47:23 but this is the timeline, 47:25 is that after I wrote about 47:27 how it's not going to work fundamentally, 47:29 then we had Bitcoin Season 2, 47:31 and then people got slightly more open-minded. 47:35 So I hope that's a trend that continues. 47:37 Ideally, today we would just run the guillotine 47:39 and never talk about Lightning again. 47:41 And then we would only talk about the other L2s. 47:43 That would be what I would prefer. 47:45 And also I think it's unfair to imagine that 47:47 Lightning is like ossified or won't improve, 47:50 like the topic that I wrote on the board is multi-party channels. 47:52 But it's not about it won't improve. 47:54 It's about the fundamental use of L1 bytes 47:56 and the lack of paying to miners. 47:58 And these are fundamental. 48:00 Paying to miners, sure, I'll give you that. 48:02 But like when you talk about the 8 billion people 48:05 and divide down how many transactions they need on-chain, 48:08 you're assuming two-party channels with that. 48:10 But if we have LN symmetry, 48:12 then those two-party channels turn into 10-party channels. 48:14 Now you've got to do your math again. 48:16 That's the channel factories idea 48:18 that I talked about in the presentation 48:21 on the post from 2022, which is February. 48:24 And that idea doesn't work 48:26 because if you have one saboteur joins, 48:28 he can just go AWOL or just do nothing. 48:31 And you either have to join by giving him money 48:34 or he has to join using L1 bytes with his own Bitcoin 48:37 or you have to give him a slot for free, 48:40 in which case he can just attack 48:42 an unlimited number of channels for free. 48:44 So there's these unsolved problems, 48:46 but Lightning Network can still improve. 48:48 And the thing is we have all these implementations 48:50 and applications already that do Lightning 48:52 based on this base protocol, 48:54 which has been designed from the very beginning 48:56 to be flexible and extensible. 48:58 And so there's room for it to grow 49:00 and people are ready to adopt new bolts. 49:02 I hear what you're saying, 49:04 but sometimes it gets to the driverless Waymo thing 49:06 where I just think, 49:08 this person has an emotional investment in Lightning. 49:10 They just said moments ago, 49:12 I agree there are fundamental problems, 49:14 but maybe one day it'll work. 49:16 And then custodial, I think it's also kind of a straw man 49:18 because we already have issues with people 49:20 with custodial Bitcoin and L1. 49:22 Decentralization is hard. 49:24 Humans will favor convenience. 49:26 The other gentleman with the sunglasses 49:28 just made about 49:30 we have to try to improve. 49:32 The way I see it is 49:34 you have the scoreboard is 49:36 what is everyone using to transact? 49:38 And the way I see it, Visa and Venmo 49:40 and Cash and everything, those are on the board 49:42 next to Lightning. 49:44 So Lightning is losing by a billion 49:46 x. 49:48 And so I agree 49:50 that we don't want custodial payments. 49:52 Custodial payments means someone else 49:54 has your Bitcoin and you have no recourse 49:56 to get it back other than 49:58 their opinion of you or their brand or something. 50:00 The trust. 50:01 So I completely agree that that's what we don't want. The fact that in practice, when people use Lightning, it is custodial, that is further evidence of it not having the right product market fit. I think it's just... 50:14 Here's my closing. There's a crisis around the world about quantum computing right now. And if you look at what a quantum computer can do in 2025, they have this huge fucking factory with tons of electricity and this weird freezer that gets down to five Kelvin and all these external computers that reduce the noise and tons of algorithms and blah, blah, blah, blah, blah, blah, blah. They got 100 qubits in there. Like, give up. You're never going to make, you're never going to break Shor's algorithm with that, right? 50:36 No, I'm not saying that we should just give up on all invention. Again, this is a driverless Waymo point. I'm not saying we should give up on driverless cars. I'm saying this thing you're in is not a driverless car. And the people who are saying that it is, they have an emotional buy into the idea and they have to just grieve and mourn the idea on their own time before they finally come to terms with what Taz Driver was trying to say in 2019 on what Bitcoin did. 51:01 And that's, you know, the reality. And the reality is I'm either too honest or too artistic or whatever to just deal with all this crazy emotional baggage that everyone's been throwing. 51:11 I do want to say, real quick, I do want to say that the feedback I'm getting might not 100% agree with you, but we have some people that haven't said anything yet. So, yeah, real quick. And if you can make it a point, what do you disagree with? What do you want to ask a question about? And then get off stage. 51:35 How about now? There we go. 51:41 Hi, Paul. I am not an expert on Lightning. I am very much a neutral party in this whole debate. I guess I have two questions for you. I'll ask one you can answer, then I'll ask the other. So the first, I love your perspective on UTXO and how in the future it could potentially allow us to expand the UTXO set and how that might affect your answer regarding Lightning. And I'll ask the second question after. 52:08 Yeah, actually, it's the same thing. I hate to say it again, Taj, but I really, really liked it at first. I loved it so much. And then eventually I decided that it's not actually that good. But UTXO is a really, really cool idea. 52:22 But the problem with it, Taj, I think, is that ultimately you're either serving all the blockchain data. It's the data availability problem. You're either a full node and you're willing to stand behind the whole blockchain as something that you have and that's accurate. Or you're not. 52:37 And so the idea of the mobile phone being a full node but it's saving on hard drive space, it's kind of like either you're the full node with all the data or you're something else and we already have SPV. And so I don't think... 52:50 I really liked it at first and I built it into the L2 that I had, the BIP300 L2 demo that did the 8 billion transactions. So it's in that demo, that simulation I used for 8 billion users. UTXO is in it. But actually, as I grew more familiar with it, I think it doesn't really actually add that much. We actually need all the fraud proofs. 53:13 Cool, thanks. Second question is basically about trade-offs. Different L2 proposal systems all are going to have potentially different trade-offs. That's why today in the fiat system we have different payment systems for different uses. 53:27 Lightning has some interesting properties, namely regarding the ability to have basically instant finality with very high degree of... very low trust assumptions because you're basically as close as you can get to the instant finality that's trustless. Do you think you can replicate that with a different L2 approach? 53:48 Yes. And that's a very good point. And when Lightning works, it does have this kind of unique and surprising thing where it's instant settlement. So that's very cool. I think in practice it's not as useful in most cases because in many... for example, if you buy something on Amazon, they can just wait for a confirmation. So they don't... zero-conf is really not needed most of the time. 54:12 If you later bounce the transaction out or something, they can just cancel it, cancel your order and just not ship it to you. So there's only a few cases where it actually helps a lot to... there's only a few cases where it helps a lot to have the instant settlement. And I think that it's kind of overblown. 54:33 The way you would get it on a different L2 is you'd have some kind of like bond thing where you'd say like, okay, I'm putting $200 of cash in this zone where if I ever sign two transactions, you can slash that and destroy it. And then if... anytime you make a payment less than $200, the merchant would have a lot of assurance that you will not sign a conflicting. So it is possible to try to replicate that advantage in the other L2s, I think. But I also think it's also not that necessary. 54:59 Quick recommendation. Less theorizing and debating and educating and more what do we disagree with or what do we want to take away from this? I know you just got on, but... 55:12 All right. I'll try to be concise here. But thanks, Paul, for doing this. And I actually appreciate your commentary on Lightning because Lightning is a big pain in the ass and especially self-custodial Lightning is a big challenge. So we need to be forthright about that. 55:29 And I think Lightning when it first came on board was a little bit falsely advertised. So I agree with that. But frankly also so is Bitcoin in a way. It takes people a long time to understand Bitcoin and self-custodial Bitcoin is a pain in the ass as well. And most people don't do that. 55:46 And Lightning is suitable right now for business-to-business and hopefully more peer-to-peer transactions, but you can hardly say that custodial Bitcoin has not been useful for HODLers over the past 10 years. 55:59 And Bitcoin's capabilities of being able to launch several exchanges in different countries is similar to Lightning, allowing developers to get up and started with a payments business very quickly. 56:09 So I just wanted to finish with a brief quotation. 56:12 The Nirvana fallacy is a logical fallacy where someone rejects a realistic or practical solution because it's not, quote, perfect. 56:22 Instead of weighing real-world trade-offs, the person compares the proposal to an idealized, flawless alternative that doesn't actually exist. Thank you. 56:32 I think it's fair, but it's incorrect. I don't compare it to a flawless alternative. As I said, I have a simulation of something else that already works for me. 56:40 So your response to that is Drivechain? 56:43 No, it's not. Although it is the case that that's part of the reason why I am even more skeptical on Lightning. 56:51 I'm like, well, this is another thing right here that doesn't have all this long list of problems. 56:57 I didn't compare it to a perfect thing or say that it has to be perfect. I said it has to work for a large number of people. 57:06 So similarly to me dragging you to Atlanta, I dragged Taj on stage. Thank you. 57:21 I would ask if both of you could make concise points and then get off stage, I would appreciate it. 57:29 Yeah, I actually had a rhetorical question for Paul. 57:33 Paul, Lightning Network's been around for a while. Do you know what the current network capacity is? 57:40 The number of coins on the network? I used to quote this all the time because I thought it was so low. I couldn't believe how low it was. 57:46 But I think now it's something like 3,900 coins? 57:48 It's around 4,000 according to 1ml.com. My follow-up question is how much WBTC is there currently? 57:56 I had this on the L2L slide that people wanted me to cut. I had this number. It was like 140,000. 58:02 It's 127,000. So I'm not good at math, but I think that's 30x or so. What are your thoughts? 58:11 That is a perfect demonstration. I had that on the slide that I used to say, this is what people actually want. 58:19 It's something else. But even when I did the simulation, on each of the 14 L2s, you only end up with between 5,000 and 10,000 BTC on the L2. 58:31 So even though for years I was amazed that it was so low, it's actually even my own simulation contradicted what I had learned to some extent. 58:38 Because there's 14 of these. So I was only at one order of magnitude or so. 58:46 So no more panelists. This is going to be the closing here. I'm changing it. You two. 58:52 We'll leave that maybe for a fireside chat. But both points and then we'll do what Taj really wanted this whole time, obviously. 59:05 All right. Can I throw this in here real quick? So you have this Waymo idea, and I've been working on something that in a way effectively is a self-drive system for the Waymo. 59:19 If that solves the problem, would you help me work on it? 59:23 Yeah, I will work on it. I will shill anything that I think is a good idea and criticize anything that I think is a bad idea. 59:30 But I feel like, again, it's being reduced to this popularity contest or something. These are just the facts. I don't know what to say. Sorry. 59:41 Don't we all just want 8 billion Bitcoin or so? 59:44 Well, I think if you design something that won't work and then someone else designs something that will work for 8 billion, then it's on borrowed time. 59:54 I agree. 59:57 You have to be on top of the state of the art. It's mandatory. 1:00:02 This might sound a little cliche, but I just wanted someone to say it on the stage that I don't think I'm the only one appreciating your perspective. 1:00:11 I think you might have the biggest crowd here. And I'm just happy that we're not marinating ourselves in our optimism all the time in our own farts and must be really uncomfortable to be on a stage with most people probably disagreeing at least slightly. 1:00:26 But I think it's very valuable. 1:00:29 Okay, thank you. Thanks very much. 1:00:34 I'm just going to come up and hang out. 1:00:37 But then when you started talking about UtrexO, I'm like, no, wait. 1:00:41 UtrexO I like because it hasn't gotten controversial because people don't really know about it. And I think it's like there's no software involved. 1:00:48 And that's like very much still in progress. And I don't promise it will allow people to run full nodes on phones very easily because there's still all the CPU work. 1:00:56 But like that one, I think there's a lot of cool stuff in there. 1:01:00 What I did want to say is the thing that so there's there's one like, I think it's not a waste of time to work on lightning. 1:01:05 I think lightning is cool. Yes. All these things. But there's a lot. So there's a bunch of things. 1:01:10 I was like, wait, no, wait, no, I'm not going to go through all of them. 1:01:12 But there was also something that struck me. It was like there are a bunch of totally legitimate criticisms. 1:01:18 Right. And like, yes, lightning has to some extent been oversold and all these things. 1:01:22 But a lot of this stuff you're saying, it's like, wait, this is just Bitcoin. Right. 1:01:26 Like so so many of these problems apply to Bitcoin in general. 1:01:30 And it's not like, yeah, this is a problem in lightning. And there's way more because, you know, people want to do custodial lightning and sort of these fake things. 1:01:37 But that's just everywhere in Bitcoin and like usability. So like I paid for the ticket to TabConf using Bitcoin. 1:01:45 And geez, it took me like three hours. I believe you made him pay for a ticket. 1:01:49 No, everyone pay. Right. Did you. Oh, OK. I don't know. But everyone at TabConf is a speaker. 1:01:58 So please, everyone buy a ticket for next year. Even if you are a speaker, it helps. 1:02:01 But it's like you got to pay Bitcoin. Come on, it's TabConf. And then I like it took me three something hours and I got it to work. 1:02:08 But it was just like and it was sort of like a depressing. I'm like, man, I've been working on Bitcoin for like, you know, 13, 14 years. 1:02:15 And it's just like, are we getting there? And like to some extent lightning as well. 1:02:20 But it's just even on chain, it's just like it's so hard. And the incentives to like the companies. 1:02:26 I've worked at different companies and like the incentive isn't necessarily we want to make everything easy for the end user who will never pay us or never. 1:02:33 We never know who they are and stuff. Most companies are like, no, we want to like capture some of that value. 1:02:39 So, yeah, like there are these problems and they extend to Bitcoin as well. 1:02:43 I don't think you can just say these are lightning problems. These are like general problems. 1:02:47 I would definitely agree that like a Bitcoin company or even a like lightning company is a little bit of a contradiction because we want there to be like a public like code based, math based thing that has no identities and has at least Cypherpunk properties. 1:03:01 And then as soon as you form a company, you have a mailing address, you have shareholders or whatever. 1:03:06 Now you're plugged into the fiat world 100 percent. So I think there's an inherent tension. 1:03:11 I completely agree. I did the flights with on chain with Electrum and with the stupid BitPay. They still won't kill this. This is like the worst idea ever. 1:03:19 And I used to tell people, people come to me and like ask like where this should work. And I tell them work at BitPay. 1:03:24 And then they'd say, I hate this thing. And they're so right. And it never works. And you have to use the D BitPay. And then I even ranted about it on Twitter. 1:03:31 Real quick, BitPay, the lovely Atlanta based company that we are, you know, we love and cherish. 1:03:39 I will pour it into BitPay and disappoint it. 1:03:41 Well, they're not sponsoring this year. 1:03:42 How can that possibly be like a D BitPay? How could that ever exist? 1:03:45 Hey Paul, real quick. We're at time. Real quick. 1:03:49 I have to ask Tash if he fundamentally disagrees with my characterization of the channels, the consumption of the L1 bytes fundamentally marring the idea and making it like harder to make it uncompetitive compared to something that does not have that. 1:04:08 Drawback. That's my, that's like the core of my technical argument. 1:04:12 So I have to, since I would have never have dragged you on stage like this. Mike did that. 1:04:17 But since you're up here, I wouldn't be doing my job if I didn't ask that question. 1:04:21 This is not new. Like in the end of the Lightning Network paper, it's like, okay, yeah, like here's the back of the envelope. 1:04:26 Like you'd need 300 megabyte blocks and then everyone could open a channel every year or something. 1:04:29 So like, yes, but yeah, but so these, these numbers are, you know, in the Lightning Network paper, it's like, yeah. 1:04:36 You need around 300. 1:04:37 The L1 bytes are very important. 1:04:39 But, but at the same time, like there are these, there are huge trade-offs, right? 1:04:45 If you're like, oh, we can use ARC. It's the same thing. It's like, well, no, they work totally differently. 1:04:49 And so that's, I think Lightning definitely still has a place. 1:04:53 And one of the reasons I work on Utrecht XO is like, well, maybe we can't, you know, everyone stopped talking about this eight years ago, but like maybe we can actually have increased L1 capacity as well. 1:05:04 And maybe if we have better technology, you can still run a crummy Raspberry Pi and have like 10 megabyte blocks or something. 1:05:09 I don't know. 1:05:10 So like working on those technologies as well to then use Lightning as sort of this, you know, force multiplier and like, hey, maybe it helps 10X or something. 1:05:18 But yeah, it's not the only solution. 1:05:21 So, but yeah, I guess my main thing is like, yes, there's problems in Lightning, but like so many of these are like everywhere in Bitcoin. 1:05:28 And it is sort of like, are we making the progress we need to? 1:05:32 Because you just online you see like treasury companies and all these custodial things. 1:05:35 It's like, yeah, that's that's scary. 1:05:37 I agree. 1:05:38 We need the best ideas to win because the custodial idea is always there lurking in the background. 1:05:44 And that is 100 percent accurate. 1:05:47 Well, we are at time. 1:05:49 Thank you. 1:05:50 Thanks, everyone. 1:05:51 Thank you. 1:05:52 Paul, if I could. 1:05:55 Paul, I want to say something real quick. 1:05:57 So TapConf Builders Conference. 1:05:59 I know you're working on your layer two. 1:06:02 You're over here. 1:06:03 Shit talking lightning. 1:06:04 You're building a solution. 1:06:06 You're not just complaining, but you're also building. 1:06:08 And what I'm really excited about is that becoming mature and you coming back to TapConf and helping make it easy for builders to check out what you're working on for years to come. 1:06:19 So we'll all be part of the solution here, right? 1:06:22 It's like it's already finished, basically. 1:06:25 Well, where's where's the where's the builder table to help on board developers? 1:06:29 Where's the. 1:06:31 All right, well, thank you.