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Hello, and welcome to Drivechain Twitter Spaces.

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This is Henry of LayerTwo Labs.

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It is Monday, February 27.

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Today, we begin yet another one of our discussions of Drivechain, which is Bitcoin Improvement

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Proposal 300 and 301.

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BIP300 is the big one.

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It's the transformative upgrade proposed for Bitcoin, which would enable hash rate escrows.

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BIP301 is blind merged mining, which is an upgrade for that very important secondary

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part of the project, which is the merged mining component.

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What this is all about, these two BIPs are about enabling advanced facilities for sidechains

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so that Bitcoin's sidechains can, instead of being federated, become peer-to-peer.

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That's how I see it personally.

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I'm excited to have this conversation today with everyone who comes up to the stage and

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speaks.

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Everyone in the audience is welcome to raise your hand and come on up, ask a question or

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comment.

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As we have more people join the room, I look forward to hearing thoughts, criticisms, raves

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and rants about Drivechain.

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We do these Twitter spaces twice a week, every Monday and Thursday.

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They're open to the public.

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Everyone is free to share your thoughts, whether you're new to Drivechain and are just beginning

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to learn about what it is, or whether you're an OG who's been following it for its seven

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years of existence, or whether you're somewhere in between.

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All right, SuperTestNet, welcome to the stage.

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Thank you, my friend. How are you this time?

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I'm well, I'm well.

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Well, you're always out whenever we speak, you're out and about.

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I always hear some noise.

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You must enjoy the great outdoors.

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That's true.

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Right. It's typically because I'm staying in a hostel and I don't like to talk inside

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because there's usually quite a bit of people in there.

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They're having breakfast or having lunch or whatever, talking to their friends.

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Listening to somebody talk on a Twitter space can be, I don't know, disruptive.

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So I usually go outside.

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Cool.

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That sounds cool.

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Well, there are a bunch of things that have been discussed on Twitter and in recent essays

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about Drivechain.

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Recently, an article was written about the Drivechain proposal by MaxMoney21Million.

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So I'll throw his essay up in the nest in case people are interested in seeing it.

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There it is.

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It was written on Substack.

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And this thoughtful person did a great review of Drivechain, studied it in detail.

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Ultimately, the author expresses a neutral to negative view where the person says that

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he doesn't support Drivechain, but he would like to see if the advocates are so enthusiastic

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about it and if they feel that they really want it, he says, then they should do a fork

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and therefore it would run live as an experiment.

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And if it were to do very well, then that would vindicate them.

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And he also explains very logically that if the advocates for Drivechain are so convinced

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that Drivechain is absolutely necessary for Bitcoin, then by doing everything they can

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to promote it, they'll be vindicated eventually one way or the other.

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I mean, that's kind of my personal view on Drivechain is that if Bitcoin fails without it

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or if Bitcoin succeeds with it, then those would show that Drivechain is good.

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Especially if Bitcoin succeeds with it and Drivechain clearly is effective in terms of

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either accruing enormous value to the sidechains and perhaps in addition, if there's clearly

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a narrative gain to Drivechain from enabling peer-to-peer sidechains such that altcoins

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no longer can use as a rationale the lack of Bitcoin's extensibility.

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SuperTestNet, we had some great tweets that we exchanged yesterday.

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What are your thoughts currently on anything?

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On anything.

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I like the MaxMoney article and I recommend it particularly for a paragraph in the section

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called Sidechains in which he gives what I think is the briefest, simplest, most clear

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and concise explanation of how Drivechains work that I've ever seen.

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And the paragraph starts with, withdrawal is the interesting part.

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So I recommend checking out that article just for the sake of even that little paragraph here.

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If you're wondering how Drivechain works, you can learn it in the space of a 50-word thing.

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So, I really like that.

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Yeah, that's my thoughts about that.

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What are your thoughts on Bitcoin's future?

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Oh, also, I fully agree with his statement that just fork Bitcoin and add Drivechains

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to it and see how it goes.

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I think that's a good idea.

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I think that's kind of what the mainchain software that Paul wrote is.

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It's a fork of Bitcoin.

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He literally picked the fork button on GitHub, added support for Drivechain,

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and now he's running it on a TestNet.

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That's exactly what I think should happen.

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Cypherpunks run code, right?

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They write and run code that they think is cool.

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And if other people think it's cool too, then they can run it too.

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So, yeah, I fully endorse that statement.

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Not only is it a good idea to fork Bitcoin and add Drivechain to it, that's what we did.

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And the software is running right now, and you can test it out if you want to.

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So, yeah.

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I saw your tweets yesterday on Ordinals, and I was wondering if you could explain it further.

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It seems to me, SuperTestNet, that your view, which is, if I understand it correctly,

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is an opposition to Ordinals.

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Your view is not consistent with what I presume is the standard pro-Drivechain view on Ordinals.

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If I understand correctly, the pro-Drivechain view,

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and by that I mean most of the sophisticated people who like Drivechain a lot,

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what is their view on Ordinals?

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I think probably it's that Ordinals aren't bad,

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whereas you have this view that Ordinals are not good and should be censored in different ways

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by individuals who don't like them.

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So, can you explain, because I think you probably know what I mean,

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can you explain what the pro-Drivechain view is in your words and then why you depart from it?

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Why you depart from, and this might be a simplistic take, but platform maximalism.

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The idea that Bitcoin should have everything on it.

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Like, let's move all of altcoins, shitcoins, every project,

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so that Bitcoin's layer one is the platform for everything and it has no competition.

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That's the Drivechain view.

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So, you're saying, well, Ordinals aren't good,

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but isn't the Drivechain view that Ordinals are fine and let's not discourage them

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and let's simply enable Drivechain so that the Ordinals can naturally flow

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to their own little neighborhood on the Blockchain,

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which would be like the BitAssets sidechain or Drivechain,

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and that's where the NFTs and whatnot would be,

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some sort of large block Drivechain designed specifically to allow for things like Ordinals to exist.

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So, it's not that we should push them away from the monetary layer,

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it's that they would naturally flow there as fees rise

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so they can have larger block space on the Drivechain.

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Satoshi himself wanted to have poker games on Bitcoin.

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He put poker in the code for Bitcoin.

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Literally, there was like fold, raise, call, these kind of poker terms.

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He didn't build it out completely,

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but he was trying to do peer-to-peer poker on Bitcoin's layer one, was he not?

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So, your view is a movement away from that towards this modern,

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only a few years old idea that the Blockchain should exclusively be for payments

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and nothing more interesting, nothing more complicated,

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because that would somehow compete with the poor people who want to use the payment system,

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but we need to have a layered system where everybody gets what they want.

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That's capitalism.

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In America, we don't say no one can have a casino, no one can have a strip club,

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no one can have a basketball tournament.

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You can only do what we think the economy should be,

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which is farming and education and nothing else, no entertainment.

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That's not, no art museums.

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We don't want to do that.

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We want to be capitalistic.

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Yeah, please jump in.

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Tell me how I'm wrong.

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Sure, sure.

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First, I'd like to mention that I don't think ordinals are bad.

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I think inscriptions are dumb.

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Ordinals is a completely off-chain accounting system

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that pretends that Bitcoins go into addresses in a first-in, first-out method

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so that you can track individual satoshis,

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and ordinals read no on-chain footprint.

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I think they're a pretty clever way to pretend that you can track individual satoshis,

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and then assign them names and assign them data and stuff.

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So that's cool. I don't mind ordinals at all.

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In fact, one of the things I think that's cool about them is they can potentially kill Bitcoin.

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Because if the first-in, first-out accounting model becomes very popular,

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that kind of social construct completely destroys Bitcoin's fungibility,

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and it survives coinjoins and other ways of transferring Bitcoin anonymously.

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They get completely broken and destroyed if you can just track the individual satoshis on that level,

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which would allow for blacklisting of individual UTXOs and stuff.

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So I think they're cool because of that,

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because somebody figured out a way that might actually destroy Bitcoin.

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If that works, that's really useful knowledge to have.

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But the inscriptions, I think, are particularly dumb,

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because they use block space very inefficiently for something that is better done elsewhere.

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So an example is BitTorrent.

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BitTorrent is a great example of file-sharing software that's decentralized, distributed, and censorship-resistant.

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It's a lot better than Bitcoin for doing file-sharing.

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It's been around longer, it works very well, and it doesn't cost as much to use it for file-sharing.

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So if someone wants to put a JPEG on the blockchain so that it's censorship-resistant and can't be taken down by someone,

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I think BitTorrent's a better place to do that.

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If they want to sell it, I think that's where Bitcoin comes in.

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Bitcoin is good for buying things and selling things.

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I don't think it's very good for storing data.

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I like the idea of people buying art with Bitcoin.

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I don't like the idea of people storing art on Bitcoin.

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It's very inefficient, it clogs up my node, it clogs up your node,

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it makes blocks more expensive for all of us if we're trying to do payments.

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There's a better place to do that.

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We have file-sharing that's censorship-resistant.

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It's called BitTorrent, and it's a great thing to do, to use.

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You mentioned the poker client that Satoshi had in the original client,

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or at least partially had in the original client.

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I don't think that's an example of doing non-bitcoin use on the blockchain.

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I think it's an example of doing payments on the blockchain.

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As far as I'm aware, the individual messages,

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such as, I have four aces and a king, or you have a full house,

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those messages were not added to the blockchain.

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They were sent off-chain, peer-to-peer, between people.

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The only thing that was on-chain was the payment to put money into a call,

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or what's it called, into a kitty,

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and then for someone to take that kitty after they won the game.

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It was the payments part that was on the chain,

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and the actual data representing the various parts of the card game,

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that was off-chain.

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I think that's a great way to do it.

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You're using Bitcoin for payments, you're using a different network,

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a peer-to-peer messaging protocol,

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for the stuff that Bitcoin's not good for.

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So yeah, that's kind of my view.

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You use Bitcoin for what it's good for, payments,

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and then if you are using inscriptions or something

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that is not only not a great thing for Bitcoin to do,

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but actually makes it worse,

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it actually makes it harder to run a node,

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I'm in favor of getting rid of that,

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censoring it, soft-working it out,

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so that Bitcoin returns to what it's really good at,

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which is just being money,

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and you can use other things for inscriptions and file sharing.

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If we had a drivechain that was for NFTs,

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and if we had a drivechain that was for big block payments,

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and a drivechain for privacy payments,

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and a drivechain for a peer-to-peer Oracle network,

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like HiveMind,

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do you agree that no longer would you say that Bitcoin is only good for money?

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Instead, you would say something like,

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Bitcoin's layer one is used by people primarily for digital gold,

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and at the same time,

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they also use the higher layer, the drivechain,

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for scalability, fungibility, and other forms of money,

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like efficient money, private money,

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and then in addition, prediction markets,

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and other things, like the BitAssets NFT-focused drivechain.

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So then we would say that the layer one is repurposed

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through profitable software,

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merged mining architecture, BIP301,

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to enable the layer one mining to be doubly useful,

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so it's not just mining layer one,

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it's also mining other blockchains that are on top of Bitcoin,

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so when you say that Bitcoin is for money,

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or something like that,

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I'm just wondering why it is that you express yourself

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in a way that seems at odds with the platform maximalism view of drivechain,

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which you support, like you like the BIPs,

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but the BIPs are all about making Bitcoin for all kinds of things,

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not just money.

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Yeah, so I think I've mentioned this on this basis before,

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in a previous episode,

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but I don't view drivechains as a layer two of Bitcoin.

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I view them as a form of a type of custodial sidechain,

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similar to the ones we have today,

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but better, because letting miners have the money

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is more censorship-resistant

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than letting a fixed federation have the money.

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So from that perspective,

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I don't view using a bid-assets drivechain

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or an each-side drivechain as actually using Bitcoin.

237
00:17:25,159 --> 00:17:27,159
I would say you stop using Bitcoin

238
00:17:27,159 --> 00:17:30,159
the moment you move your money onto the drivechain,

239
00:17:30,159 --> 00:17:33,159
and now you're using that other thing instead.

240
00:17:33,159 --> 00:17:36,159
From that perspective, I view it as sort of pay-to-access.

241
00:17:36,159 --> 00:17:38,159
It costs a certain amount of money

242
00:17:38,159 --> 00:17:40,159
to access the features of this drivechain,

243
00:17:40,159 --> 00:17:43,159
you move off of Bitcoin in order to do that,

244
00:17:43,159 --> 00:17:46,159
you deposit your money into this Bitcoin address,

245
00:17:46,159 --> 00:17:49,159
and later, you have a reasonable expectation

246
00:17:49,159 --> 00:17:51,159
of getting your money back

247
00:17:51,159 --> 00:17:53,159
because of the pass-rate escrow.

248
00:17:53,159 --> 00:17:54,159
That's how it works.

249
00:17:54,159 --> 00:17:56,159
It gives you your money back when you're done,

250
00:17:56,159 --> 00:18:00,159
or whatever's left over after you're done using that sidechain.

251
00:18:00,159 --> 00:18:03,159
So yeah, I kind of view that as a better place to do that

252
00:18:03,159 --> 00:18:05,159
because you're moving that activity off of Bitcoin

253
00:18:05,159 --> 00:18:08,159
and onto something that's designed for it.

254
00:18:08,159 --> 00:18:11,159
However, I don't think a drivechain

255
00:18:11,159 --> 00:18:15,159
would be better than something like Bitcoin for assets,

256
00:18:15,159 --> 00:18:18,159
for pictures, in other words.

257
00:18:18,159 --> 00:18:23,159
I think, still, put your image on Bitcoin

258
00:18:23,159 --> 00:18:25,159
and then sell it for Bitcoin

259
00:18:25,159 --> 00:18:28,159
is a better model than put it on a blockchain

260
00:18:28,159 --> 00:18:30,159
and sell it there.

261
00:18:30,159 --> 00:18:33,159
But even though I think that's still a dumb place to do it,

262
00:18:33,159 --> 00:18:35,159
I want people to be able to do that

263
00:18:35,159 --> 00:18:38,159
because it's better than doing what they're currently doing.

264
00:18:38,159 --> 00:18:40,159
So, there's that.

265
00:18:40,159 --> 00:18:42,159
Well, isn't the idea of the ordinals

266
00:18:42,159 --> 00:18:45,159
that there's some kind of linkage?

267
00:18:45,159 --> 00:18:48,159
Instead of selling it on one marketplace

268
00:18:48,159 --> 00:18:50,159
and using Bitcoin,

269
00:18:50,159 --> 00:18:55,159
the only way Bitcoin is involved is as the payment.

270
00:18:55,159 --> 00:19:03,159
Instead, the provenance of ownership of the artwork

271
00:19:03,159 --> 00:19:07,159
is, to some extent, traceable on Bitcoin

272
00:19:07,159 --> 00:19:10,159
and therefore is more secure and stable

273
00:19:10,159 --> 00:19:13,159
as a form of documentation of ownership,

274
00:19:13,159 --> 00:19:15,159
cryptographically verifiable,

275
00:19:15,159 --> 00:19:17,159
that sort of thing.

276
00:19:17,159 --> 00:19:19,159
Isn't that the narrative of ordinals?

277
00:19:19,159 --> 00:19:26,159
That it's kind of like combining...

278
00:19:26,159 --> 00:19:29,159
Instead of selling on Oversee and paying a Bitcoin...

279
00:19:29,159 --> 00:19:31,159
Yeah, go ahead.

280
00:19:31,159 --> 00:19:36,159
Yeah, I would say that that is one of the narratives.

281
00:19:36,159 --> 00:19:38,159
In fact, it's correct.

282
00:19:38,159 --> 00:19:40,159
Ordinals are quite an efficient way

283
00:19:40,159 --> 00:19:44,159
of transferring around the concept of ownership

284
00:19:44,159 --> 00:19:46,159
from one person to another.

285
00:19:46,159 --> 00:19:48,159
Because after you've, quote-unquote,

286
00:19:48,159 --> 00:19:51,159
inscribed a Sajoshi,

287
00:19:52,431 --> 00:19:56,431
with this extra piece of data, after that, the protocol is extremely efficient.

288
00:19:56,431 --> 00:20:00,431
Because all you're doing, that Sajoshi just points back to the piece of data you've created,

289
00:20:00,431 --> 00:20:03,431
and you're just transferring that around as a payment.

290
00:20:03,431 --> 00:20:10,431
Like, I get 10,000 Sats and you get this Sajoshi that points to a picture of a monkey.

291
00:20:10,431 --> 00:20:16,431
And so you've effectively bought that picture of a monkey by means of just a simple Bitcoin transaction

292
00:20:16,431 --> 00:20:23,431
that transferred one Sat to you, some UTXO to you, and your larger UTXO to me.

293
00:20:23,431 --> 00:20:26,431
And I think that's great. That's really cool technology.

294
00:20:26,431 --> 00:20:32,431
And it's a really efficient way of transferring the concept of ownership around using the blockchain,

295
00:20:32,431 --> 00:20:35,431
using what it's good for, which is payments.

296
00:20:35,431 --> 00:20:40,431
The only inefficient part about it is the part where they store the data,

297
00:20:40,431 --> 00:20:43,431
store the image itself on Bitcoin's blockchain.

298
00:20:43,431 --> 00:20:46,431
And there's no reason they need to do that, or at least I don't think so.

299
00:20:46,431 --> 00:20:53,431
I think if you stored it on something like Bitcoin, and you took the magnet link and hashed that,

300
00:20:53,431 --> 00:20:56,431
that's the only thing that you need to put on Bitcoin.

301
00:20:56,431 --> 00:21:00,431
It's like a tiny little hash, Bitcoin's got great tooling for that,

302
00:21:00,431 --> 00:21:03,431
and you're using the blockchain efficiently.

303
00:21:03,431 --> 00:21:06,431
Now you're just transferring around an individual Sajoshi and individual payments,

304
00:21:06,431 --> 00:21:14,431
which Bitcoin is good for, to represent the transfer of ownership of that image.

305
00:21:14,431 --> 00:21:17,431
So you're buying art with Bitcoin, but you're not storing art on Bitcoin.

306
00:21:17,431 --> 00:21:20,431
And that's kind of the model that I prefer.

307
00:21:22,431 --> 00:21:31,431
Okay. So as usual, your response is very sophisticated and is just great for me to hear,

308
00:21:31,431 --> 00:21:36,431
because your understanding of Ordinals is that of a developer, a software engineer,

309
00:21:36,431 --> 00:21:38,431
you really understand what's going on here.

310
00:21:38,431 --> 00:21:44,431
For me, and others listening, perhaps, some others, it's interesting to hear your take.

311
00:21:44,431 --> 00:21:50,431
I'm able to gather just the kind of overall narrative of what's going on.

312
00:21:50,431 --> 00:21:53,431
I'd like to pivot to one thing you said in your response,

313
00:21:53,431 --> 00:21:59,431
which was you talked about the drivechain hash rate escrow being akin to custodial.

314
00:22:00,431 --> 00:22:07,431
And fundamentally different than the peer-to-peer nature of Bitcoin.

315
00:22:08,431 --> 00:22:17,431
So you view use of a drivechain as use of something that's not too far away from custodial Bitcoin.

316
00:22:17,431 --> 00:22:30,431
But you're also a supporter of the notion that the hash rate escrow is an attractive alternative to federated sidechains.

317
00:22:30,431 --> 00:22:33,431
So is that right?

318
00:22:33,431 --> 00:22:34,431
Yeah.

319
00:22:35,431 --> 00:22:42,431
My next question then is, isn't it true that in Bitcoin,

320
00:22:42,431 --> 00:22:49,431
the majority of hash rate could halt the usability of Bitcoin forever

321
00:22:49,431 --> 00:23:01,431
in the form of a perpetual hostile attack, which is intended to devalue the token completely?

322
00:23:01,431 --> 00:23:09,431
And therefore, isn't there a reliance on miners from the get-go?

323
00:23:09,431 --> 00:23:25,431
And therefore, I think that your differentiation between hash rate escrow and Bitcoin Layer 1 is not so crystal clear to me.

324
00:23:25,431 --> 00:23:31,431
It sounds like you're saying when you own Bitcoin Layer 1 UTXOs,

325
00:23:31,431 --> 00:23:42,431
you own something that is a far superior property right interest than when you own the drivechain synthetic Bitcoin.

326
00:23:42,431 --> 00:23:48,431
Because that can be rugged because the miners could steal it, but they can't steal Layer 1 Bitcoin.

327
00:23:48,431 --> 00:23:58,431
This is one of the main objections to drivechain is that the miners can steal the drivechain's Bitcoin and they can't steal Layer 1 Bitcoin.

328
00:23:58,431 --> 00:24:06,431
So therefore, the drivechain situation is much more precarious and introduces a whole different security model.

329
00:24:06,431 --> 00:24:09,431
But Layer 1 Bitcoin relies on the miners.

330
00:24:09,431 --> 00:24:11,431
So everyone's relying on the miners.

331
00:24:12,431 --> 00:24:21,431
If someone comes along, if Janet Yellen tomorrow has 90% of the hash rate, isn't that game over? Probably.

332
00:24:21,431 --> 00:24:31,431
So why is it that you feel that drivechains are semi-custodial and Layer 1 Bitcoin is much safer?

333
00:24:32,431 --> 00:24:42,431
I'm wondering why is it you place drivechain on the spectrum so close to a federated sidechain and not close to Layer 1 Bitcoin?

334
00:24:42,431 --> 00:24:54,431
Because in my view, if we're already trusting the miners to some extent, then more isn't so bad and is much better than trusting 15 individual people.

335
00:24:54,431 --> 00:25:03,431
Because as we've talked about before, I view mining as peer-to-peer because Bitcoin is peer-to-peer and mining is part of Bitcoin.

336
00:25:03,431 --> 00:25:07,431
And therefore, hash rate escrow is peer-to-peer.

337
00:25:07,431 --> 00:25:10,431
And that's fundamentally different than a federation.

338
00:25:10,431 --> 00:25:12,431
A federation isn't peer-to-peer.

339
00:25:13,431 --> 00:25:27,431
The individuals involved are socially selected to control the federated multisig, whereas in mining, anyone can start mining and participate in the hash rate escrow control.

340
00:25:27,431 --> 00:25:30,431
The only barrier is economic, not social.

341
00:25:30,431 --> 00:25:34,431
And therefore, for me, it's all about is something peer-to-peer or not?

342
00:25:34,431 --> 00:25:38,431
That's my fundamental thing is like, is it peer-to-peer or not?

343
00:25:38,431 --> 00:25:41,431
And I feel like you have a different way of looking at it.

344
00:25:43,431 --> 00:25:49,431
Yeah, so there's a big chunk of what you said that I fully endorse.

345
00:25:49,431 --> 00:25:53,431
I'm just going to repeat it in my own words because I like it.

346
00:25:53,431 --> 00:25:57,431
Now I forget how to start it.

347
00:25:57,431 --> 00:26:03,431
Yet miners, we already trust miners in Bitcoin.

348
00:26:03,431 --> 00:26:06,431
We trust them for the ordering of transactions and the creation of blocks.

349
00:26:07,431 --> 00:26:17,431
And because we already trust them, I think it's a good idea to leverage that trust to let people say, I'd like to hold my money with them as well.

350
00:26:17,431 --> 00:26:28,431
And then use them as the federation, so to speak, or the replacement of a regular federation in the usage of a sidechain.

351
00:26:28,431 --> 00:26:32,431
I think that's better than federated sidechains.

352
00:26:32,431 --> 00:26:34,431
And so I endorse it.

353
00:26:34,431 --> 00:26:36,431
Sounds like a good idea. Let's do that.

354
00:26:36,431 --> 00:26:41,431
Let's make a bit that makes this hash rate escrow easier to do.

355
00:26:41,431 --> 00:26:45,431
So, yeah, I endorse that and 100% support it.

356
00:26:45,431 --> 00:26:51,431
But the previous part, yeah, that's all I can remember of what you said.

357
00:26:51,431 --> 00:26:55,431
There was something before that that I wanted to get what it was.

358
00:26:55,431 --> 00:27:01,431
It sounds like you think hash rate escrow is pretty close to a federation sidechain arrangement.

359
00:27:01,431 --> 00:27:14,431
But I feel hash rate escrow is pretty close to because it's peer to peer, pretty close to a Bitcoin layer one arrangement sort of categorically in terms of it being peer to peer, not federated.

360
00:27:15,431 --> 00:27:23,431
So I was wondering why you said – my original point was why did you say that hash rate escrow is similar to custodial Bitcoin?

361
00:27:23,431 --> 00:27:34,431
Yeah, I remember the thing I disagreed with now, which was the stuff about isn't the game over if Janet Yellen gets 90% hash rate.

362
00:27:34,431 --> 00:27:37,431
And I don't think it is.

363
00:27:37,431 --> 00:27:44,431
I think that one of the nice things about Bitcoin is that it costs real world money to mine.

364
00:27:44,431 --> 00:27:55,431
And when you censor certain payments, there's a sense in which you're losing money or you're not gaining as much as you could.

365
00:27:55,431 --> 00:27:58,431
You have a negative on your income sheet.

366
00:27:58,431 --> 00:28:01,431
And that negative is the fees you're giving up.

367
00:28:01,431 --> 00:28:06,431
Fees you're saying I'm not going to mine these transactions because I'm going to censor them.

368
00:28:06,431 --> 00:28:10,431
I don't agree with whatever they're trying to do, whoever's trying to make them or whatever.

369
00:28:10,431 --> 00:28:16,431
So you have a negative on your balance sheet.

370
00:28:16,431 --> 00:28:23,431
And as the number of censored transactions grows, the size of the negative on your balance sheet also grows.

371
00:28:23,431 --> 00:28:31,431
The size of the income you're not taking, the opportunity cost increases.

372
00:28:31,431 --> 00:28:34,431
Meanwhile, there's other people who can mine as well.

373
00:28:34,431 --> 00:28:36,431
It's like you said, anyone can mine.

374
00:28:36,431 --> 00:28:38,431
Anyone can spin up miners.

375
00:28:38,431 --> 00:28:47,431
And as the amount of censored transactions grows, they're just going to sit there in the mempool waiting for somebody to mine them and accumulate.

376
00:28:48,431 --> 00:29:02,431
And eventually, after a long enough period of time, they're likely to become worth someone spinning up enough miners to go overcome Janet Yellen's hash rate because it's now worth it.

377
00:29:02,431 --> 00:29:13,431
You can make more money by spinning up enough miners to do it than money she has to keep on trying to censor them and trying to censor you.

378
00:29:14,431 --> 00:29:23,431
Because of that, I think Bitcoin works out in this situation where even if Janet Yellen does get 90% of hash rate, she's only able to censor temporarily.

379
00:29:23,431 --> 00:29:36,431
She doesn't have custody of your money because after a long enough period of time, after the censored fees rise, she loses control of the network because other people are incentivized to spin up miners as well.

380
00:29:36,431 --> 00:29:38,431
And Janet Yellen can't stop it.

381
00:29:38,431 --> 00:29:43,431
There's nothing she can do about it because she doesn't control energy in the world.

382
00:29:43,431 --> 00:29:55,431
The concept of energy, like the ability for people to accumulate hash rate.

383
00:29:55,431 --> 00:29:57,431
You can't stop people from doing that.

384
00:29:58,431 --> 00:30:00,431
Whereas drivechain, I think, is different.

385
00:30:00,431 --> 00:30:08,431
Or at least it makes that much harder because in order to participate in a drivechain, you have to be in the top 51%.

386
00:30:08,431 --> 00:30:13,431
And it's really hard to get that amount of hash rate.

387
00:30:13,431 --> 00:30:18,431
With regular Bitcoin, you don't need to be in the top 51% to mine your own transactions.

388
00:30:18,431 --> 00:30:26,431
You just need to be part of a set of people who's willing to not censor that particular transaction.

389
00:30:26,431 --> 00:30:36,431
As long as 51% of people, of miners, aren't censoring, you just need to be part of a much smaller set of people.

390
00:30:36,431 --> 00:30:42,431
Whereas in order to participate in a drivechain, you need to be in the top 51%, which is a much harder thing to get to.

391
00:30:42,431 --> 00:30:47,431
So I view that as a big separation between what drivechain offers and what Bitcoin offers.

392
00:30:50,431 --> 00:30:52,431
Very interesting.

393
00:30:52,431 --> 00:30:54,431
There is quite a bit of background noise.

394
00:30:54,431 --> 00:30:59,431
I hope maybe in the future we can find a way to chat in a quieter place.

395
00:30:59,431 --> 00:31:03,431
But I heard everything you said, and it was very interesting.

396
00:31:03,431 --> 00:31:19,431
Well, we've talked today quite a bit about ordinals and platform maximalism, as well as the difference between custodial Bitcoin, hash rate escrow, and a federated sidechain, multisig.

397
00:31:19,431 --> 00:31:23,431
We could go on to any other topics.

398
00:31:23,431 --> 00:31:32,431
One, I want to mention anyone in the audience is welcome to raise their hand and join our conversation.

399
00:31:32,431 --> 00:31:35,431
If you have a question or comments about drivechain.

400
00:31:35,431 --> 00:31:42,431
There have been some pretty cool comments lately from Dr. Adam Back of Blockstream.

401
00:31:42,431 --> 00:31:48,431
Blockstream's illustrious founder and chief executive officer.

402
00:31:48,431 --> 00:31:52,431
I will put one of them in the nest.

403
00:31:52,431 --> 00:31:56,431
He wrote two days ago to Roger Ver.

404
00:31:56,431 --> 00:32:08,431
Roger Ver was saying a tweet about the block size, and Roger Ver was saying that Bitcoin should increase its block size, and that will vindicate the big blockers.

405
00:32:08,431 --> 00:32:17,431
And Adam Back replied, better still, Bitcoin adds a drivechain, as I suggested to you in person a few times pre-forks.

406
00:32:18,431 --> 00:32:20,431
So he's saying years ago.

407
00:32:20,431 --> 00:32:24,431
You even sponsored some research and development on drivechains back then.

408
00:32:24,431 --> 00:32:32,431
If you had worked on win-win large block drivechains, there would have been less drama, and you'd have more Bitcoin also.

409
00:32:32,431 --> 00:32:39,431
Which is a bit of a dig, because there have been rumors of Roger Ver owing money to this or that exchange.

410
00:32:39,431 --> 00:32:41,431
I have no idea if those are true.

411
00:32:41,431 --> 00:32:43,431
I just see them on crypto Twitter.

412
00:32:44,431 --> 00:32:55,431
I do agree with Adam's point about win-win, that a big block drivechain enables the big blockers to get what they want and the small blockers to get what they want.

413
00:32:55,431 --> 00:32:59,431
So people who want big blocks can opt-in to the drivechain.

414
00:32:59,431 --> 00:33:04,431
People who want big blocks can opt-in to the big block drivechain.

415
00:33:04,431 --> 00:33:08,431
Anyone who doesn't want big blocks cannot opt-in to the big block drivechain.

416
00:33:08,431 --> 00:33:15,431
They can just stay on small block layer one and do lightning there and have everything they need.

417
00:33:15,431 --> 00:33:28,431
So drivechain fundamentally was inspired in 2015 to avoid disputes within the Bitcoin development community.

418
00:33:29,431 --> 00:33:38,431
The idea was to enable Bitcoin developers to stay within Bitcoin and use sidechains instead of launching altcoins.

419
00:33:38,431 --> 00:33:47,431
I think from that perspective, it's also kind of ironic that it's become very controversial and divisive within the Bitcoin developer community.

420
00:33:47,431 --> 00:33:50,431
Then its purpose is to avoid division.

421
00:33:50,431 --> 00:33:52,431
I think that's funny.

422
00:33:55,431 --> 00:33:57,431
Yes, yes, it is ironic.

423
00:33:57,431 --> 00:33:58,431
It's ironic.

424
00:33:58,431 --> 00:34:04,431
You know, people sometimes say, you know, maybe Paul will go off and do his own thing.

425
00:34:04,431 --> 00:34:14,431
And that is ironic because the whole point of drivechain was to enable Bitcoin to be inclusive technologically.

426
00:34:14,431 --> 00:34:17,431
And I think I like that.

427
00:34:17,431 --> 00:34:24,431
Let me ask you, do you agree with the narrative that if drivechain had been adopted in 2015?

428
00:34:26,431 --> 00:34:36,431
Over the last seven years, we might have seen vastly less development on altcoins and vastly more development on Bitcoin.

429
00:34:36,431 --> 00:34:41,431
And to some extent, very interestingly, there is one scenario.

430
00:34:42,431 --> 00:34:46,431
Which is that instead of there being so many.

431
00:34:49,431 --> 00:34:59,431
So many like token launches, there would have just been less overall development in the blockchain space because a lot of the development is not productive.

432
00:34:59,431 --> 00:35:06,431
And it only exists because there is this rationale that Bitcoin is hard to develop on.

433
00:35:06,431 --> 00:35:18,431
And that creates a window of discourse for founders to say, I have a new idea and I'm launching something and I have to launch it independently as a new coin because it's hard to build on Bitcoin.

434
00:35:18,431 --> 00:35:28,431
And therefore, if drivechain were created, one of the effects would simply be that there are fewer altcoins, not that every altcoin would move to Bitcoin.

435
00:35:28,431 --> 00:35:32,431
Because, of course, things like Dogecoin wouldn't move to Bitcoin.

436
00:35:32,431 --> 00:35:40,431
They wouldn't move to a drivechain because they're all about being an independent altcoin.

437
00:35:40,431 --> 00:35:42,431
Well, actually, it's merge mine with Litecoin.

438
00:35:42,431 --> 00:35:44,431
But the point is that it's an altcoin.

439
00:35:44,431 --> 00:35:45,431
It's not a synthetic Bitcoin.

440
00:35:45,431 --> 00:35:51,431
So there still would be speculative tokens sometimes just for Ponzinomics and entertainment.

441
00:35:51,431 --> 00:36:00,431
But there'd be far less of that, especially the kind that is really a pump and dump, but that masquerades as a legitimate productive technology.

442
00:36:00,431 --> 00:36:02,431
I'm sure you understand what I mean.

443
00:36:02,431 --> 00:36:06,431
Do you agree with that narrative that drivechain could have diminished those kinds of problems?

444
00:36:06,431 --> 00:36:07,431
Yeah.

445
00:36:07,431 --> 00:36:09,431
Especially because you said could have.

446
00:36:09,431 --> 00:36:11,431
Or earlier you said might have.

447
00:36:11,431 --> 00:36:14,431
Yeah, it could have happened and it might have happened.

448
00:36:14,431 --> 00:36:17,431
I can't rule it out.

449
00:36:17,431 --> 00:36:19,431
I don't know.

450
00:36:19,431 --> 00:36:37,431
But if we were reading a newspaper headline today and we were in a world where drivechains was made 15, 5 years ago, it would not surprise me to read a headline that says, like, there could have been a lot of altcoin development if Bitcoin hadn't made drivechains.

451
00:36:37,431 --> 00:36:38,431
Whew!

452
00:36:38,431 --> 00:36:39,431
Good thing we avoided that.

453
00:36:40,431 --> 00:36:44,431
That's like a possible future or possible alternative present we could be living in.

454
00:36:44,431 --> 00:36:45,431
But I don't know.

455
00:36:45,431 --> 00:36:47,431
It could also have turned out differently.

456
00:36:47,431 --> 00:36:59,431
And one thing that makes me suspect that it could also have turned out differently is that we currently have sidechains that are not very popular.

457
00:37:00,431 --> 00:37:03,431
People aren't using the confidential transactions on Liquid.

458
00:37:03,431 --> 00:37:05,431
They're using Monero instead.

459
00:37:05,431 --> 00:37:10,431
People aren't using the Ethereum EVM on Rootstock.

460
00:37:10,431 --> 00:37:12,431
They're using Ethereum instead.

461
00:37:12,431 --> 00:37:21,431
And I think the reason for that is it doesn't necessarily go away in a drivechain world.

462
00:37:22,431 --> 00:37:26,431
Part of the reason might be that people just really don't like federated sidechains.

463
00:37:26,431 --> 00:37:31,431
They're just unwilling to store their money with this group.

464
00:37:31,431 --> 00:37:34,431
But I don't think that's really the case because they seem to do that a whole lot.

465
00:37:34,431 --> 00:37:39,431
Like, that's one of the most popular things you could do on Ethereum and on Monero.

466
00:37:39,431 --> 00:37:44,431
It's like, give your coins to some custodian and let them do everything for you.

467
00:37:44,431 --> 00:37:51,431
So I suspect the reason why people like those other things has nothing to do with the technology and more to do with the pump and dump aspect of it.

468
00:37:51,431 --> 00:37:58,431
Like that meme I shared with you yesterday where the guy's like, everyone should use Monero because it's way more private than Bitcoin.

469
00:37:58,431 --> 00:38:05,431
And the other guy's like, Bitcoin has CoinJoin wallets and these offer excellent privacy.

470
00:38:05,431 --> 00:38:11,431
And his counter-interlocutors are like, I don't care about privacy.

471
00:38:11,431 --> 00:38:17,431
People should buy Monero because I have heavy bags of Monero and I want their price to rise.

472
00:38:17,431 --> 00:38:24,431
That's what it's really about. It's not really about the additional privacy you can get because Bitcoin already offers really great privacy.

473
00:38:24,431 --> 00:38:29,431
So I think the same thing might hold true in a drivechain world.

474
00:38:29,431 --> 00:38:36,431
It might be that people would create altcoins because they don't really care about the technology that you can also do with Bitcoin.

475
00:38:36,431 --> 00:38:38,431
They care about the pump and dump.

476
00:38:38,431 --> 00:38:43,431
They really want that. They want something with a chance of rising in price exponentially.

477
00:38:43,431 --> 00:38:50,431
They're just going to use that. They're going to do that regardless of the fact that if you did it on Bitcoin, you'd get the same technology.

478
00:38:50,431 --> 00:38:55,431
Or if you did it on a drivechain rather, you'd get the same technology but without the pump and dump.

479
00:38:55,431 --> 00:39:01,431
I think that might anger people because they want the pump and dump more than they want the Bitcoin.

480
00:39:02,431 --> 00:39:10,431
Well, I'm curious to hear your thoughts on the following.

481
00:39:10,431 --> 00:39:24,431
Isn't it true, like you were just describing how the federated sidechains on Bitcoin see not a lot of use but a similar arrangement to federated sidechains see a lot of use on Ethereum.

482
00:39:25,431 --> 00:39:44,431
Isn't there a narrative difference where on Ethereum, once a project grows very large, it can graduate from what is akin to a custodial or federated arrangement to a higher level of so-called decentralization,

483
00:39:44,431 --> 00:39:48,431
where they kind of graduate from the...

484
00:39:49,864 --> 00:39:59,864
...incubation period, which has a custodial model of security, to a more decentralized model that's more peer-to-peer.

485
00:39:59,864 --> 00:40:09,864
For example, I've heard people say things like... I've heard someone say a month ago, there are four people who can rug Chainlink.

486
00:40:09,864 --> 00:40:15,864
I heard someone write that, that it's not really fully decentralized.

487
00:40:15,864 --> 00:40:17,864
Sounds like Chris Black.

488
00:40:17,864 --> 00:40:27,864
But someone else told me, well, that might be true, but something like Uniswap doesn't have that, where it is fully decentralized.

489
00:40:27,864 --> 00:40:35,864
It's not like four guys can just control the whole thing through a backdoor like some of these zero-knowledge layers on Ethereum.

490
00:40:35,864 --> 00:40:46,864
In the long run, it is possible on Ethereum, if I'm not mistaken, to have a project graduate into a more decentralized, more peer-to-peer ultimate foundation.

491
00:40:46,864 --> 00:40:50,864
Is that true? And is that lacking? That narrative lacks?

492
00:40:50,864 --> 00:41:02,864
RSK or Liquid can't announce tomorrow that they're going to decentralize and no longer will there be 15 people who control the multisig.

493
00:41:02,864 --> 00:41:07,864
It'll all of a sudden be just as decentralized as Bitcoin mining itself or something like that.

494
00:41:07,864 --> 00:41:11,864
They can't just... I mean, that would be graduating into a drivetrain, for example.

495
00:41:11,864 --> 00:41:14,864
Like that's what RSK wants to do, but that's not possible on Bitcoin.

496
00:41:14,864 --> 00:41:22,864
Whereas on Ethereum, is it possible for things to evolve into that higher realm of development?

497
00:41:22,864 --> 00:41:28,864
Well, it is somewhat of a nuanced answer.

498
00:41:28,864 --> 00:41:30,864
I want to say, yes, it's possible.

499
00:41:30,864 --> 00:41:37,864
But I don't think there's a sense in which it's not, because Ethereum itself is a permissioned system.

500
00:41:38,864 --> 00:41:46,864
The L1 that these protocols are built on top of is a permissioned system, especially after they moved to Proof-of-Stake.

501
00:41:46,864 --> 00:41:48,864
It was still true before that.

502
00:41:48,864 --> 00:41:56,864
But now that they moved to Proof-of-Stake, it's very clear that the current people who are running the staking pools are the only ones who get to approve transactions.

503
00:41:56,864 --> 00:41:59,864
And without their permission, you can't enter that group.

504
00:42:00,864 --> 00:42:06,864
You have to obtain Ethereum tokens somehow in order to join one of those staking pools.

505
00:42:06,864 --> 00:42:10,864
And they get to approve whether or not you get those tokens, because that's literally how it works.

506
00:42:10,864 --> 00:42:15,864
They put their stamp of approval on all transactions, including the ones where you try to enter the staking pools,

507
00:42:15,864 --> 00:42:18,864
or the transactions where you try to accumulate enough tokens.

508
00:42:20,864 --> 00:42:23,864
So yeah, it's a totally permissioned system.

509
00:42:23,864 --> 00:42:35,864
And so there's a sense in which, no, it's not possible for a protocol to be developed on Ethereum that is totally decentralized and has no admin multisig or whatever.

510
00:42:35,864 --> 00:42:42,864
The people who are running the staking pools, they're an always-present admin multisig or backdoor into all Ethereum contracts,

511
00:42:42,864 --> 00:42:47,864
because they can stop any contract they want by just not approving those transactions anymore.

512
00:42:48,864 --> 00:43:03,864
Okay, so you've responded to the question about projects developing into a more decentralized format by criticizing a different dimension of the whole protocol.

513
00:43:03,864 --> 00:43:08,864
Suppose we were to leave aside the criticisms that you've said about proof-of-stake generally.

514
00:43:09,864 --> 00:43:20,864
Can you talk specifically about the fact that on Ethereum, its main narrative is that it's a generalized blockchain, so protocols can be created.

515
00:43:20,864 --> 00:43:23,864
And this is my own kind of simple take on it.

516
00:43:23,864 --> 00:43:25,864
I welcome you to criticize it.

517
00:43:25,864 --> 00:43:34,864
It's that people can create what are effectively like drivechains on Ethereum, in the sense that you can build a protocol, it runs peer-to-peer,

518
00:43:34,864 --> 00:43:38,864
and it's different than the basic Ethereum protocol.

519
00:43:38,864 --> 00:43:42,864
So, and then, you know, it's like the fees are in Ethereum.

520
00:43:42,864 --> 00:43:55,864
So in a sense, it kind of sounds to me like Ethereum kind of is aiming for the drivechain format, where it's not explicitly and literally merged mind,

521
00:43:55,864 --> 00:43:58,864
and they're not literally sidechains, but it's something akin to that.

522
00:43:58,864 --> 00:44:05,864
So that's, it worries me that like Bitcoin hasn't yet achieved that, those narratives and those technologies.

523
00:44:05,864 --> 00:44:18,864
Because I feel like in the long run, the generalized blockchain proponents will be vindicated that there are things other than simply money that people want to do on blockchain productively.

524
00:44:19,864 --> 00:44:29,864
Things like prediction markets, things like, you know, having money with different attributes, like private money, more scalable money, you know, different kinds of money.

525
00:44:29,864 --> 00:44:33,864
Money itself is heterogeneous, it's not a single monolithic category.

526
00:44:33,864 --> 00:44:37,864
On blockchain, there's different kinds of money, so it should be layered.

527
00:44:37,864 --> 00:44:43,864
And that's the sort of, yeah, go ahead with your reply.

528
00:44:43,864 --> 00:44:50,864
Yeah, I think the popularity of rollups on Ethereum is, I think, a vindication of the drivechain model or something equivalent to it.

529
00:44:50,864 --> 00:44:54,864
Where it's very popular on Ethereum to launch a sidechain.

530
00:44:54,864 --> 00:44:56,864
Coinbase is about to launch one, right?

531
00:44:56,864 --> 00:44:58,864
It's a very popular thing to do right now.

532
00:44:58,864 --> 00:45:02,864
You launch a sidechain, you create a two-way peg between the sidechain and Ethereum.

533
00:45:02,864 --> 00:45:04,864
And it's very popular.

534
00:45:04,864 --> 00:45:07,864
People like them, they use them, they're cheaper on fees.

535
00:45:08,864 --> 00:45:13,864
Yeah, I think it's a vindication of something similar that we want to do on Bitcoin.

536
00:45:13,864 --> 00:45:15,864
And it's very cool.

537
00:45:15,864 --> 00:45:17,864
It's very good, successful, and it delights people.

538
00:45:17,864 --> 00:45:19,864
It's good technology.

539
00:45:19,864 --> 00:45:37,864
But another point you made that I want to take issue with is that a main narrative of Ethereum is that you can graduate from a custodial or admin multi-sig kind of contract to one that's fully decentralized.

540
00:45:37,864 --> 00:45:42,864
But it seems to me that that's not very popular on Ethereum.

541
00:45:42,864 --> 00:45:45,864
In fact, the reverse seems to be very popular.

542
00:45:46,864 --> 00:45:55,864
It's not only true that you can create these contracts that don't have an admin multi-sig or a backdoor, leaving aside the vulnerabilities of the L1.

543
00:45:57,864 --> 00:45:59,864
There have been protocols that have done that.

544
00:45:59,864 --> 00:46:01,864
MakerDAO started out that way.

545
00:46:01,864 --> 00:46:06,864
They didn't have an admin multi-sig for the collateralized debt positions that were created.

546
00:46:06,864 --> 00:46:08,864
Uniswap started out that way.

547
00:46:08,864 --> 00:46:13,864
For version 1 and version 2 of Uniswap, there was no admin multi-sig that could control this stuff.

548
00:46:14,864 --> 00:46:26,864
But as Ethereum has grown and as it's developed, the ones that have the admin control of the multi-sig or have an admin backdoor have become more popular.

549
00:46:26,864 --> 00:46:28,864
MakerDAO now has one.

550
00:46:28,864 --> 00:46:34,864
And the new version that everyone uses does have an admin multi-sig that controls both.

551
00:46:34,864 --> 00:46:36,864
Same with Uniswap.

552
00:46:36,864 --> 00:46:38,864
Uniswap v3 introduced that.

553
00:46:38,864 --> 00:46:41,864
Now there's someone who can rug you and take your money.

554
00:46:41,864 --> 00:46:43,864
And those are more popular.

555
00:46:43,864 --> 00:46:45,864
People like those better.

556
00:46:46,864 --> 00:46:48,864
Oasis is another example.

557
00:46:48,864 --> 00:46:53,864
How big does a protocol have to be for someone to decide, now it's time for us to decentralize?

558
00:46:53,864 --> 00:46:55,864
I don't think there is a number.

559
00:46:55,864 --> 00:47:00,864
In fact, the bigger it grows, the more value that's locked up in that system, the less they want to decentralize.

560
00:47:00,864 --> 00:47:03,864
The more they want to have admin control over all that money.

561
00:47:04,864 --> 00:47:06,864
And the users don't seem to care.

562
00:47:06,864 --> 00:47:08,864
In fact, they seem to prefer them.

563
00:47:08,864 --> 00:47:20,864
They migrate to the ones where there is an admin with backdoor access and where they can swoop in and rug pull back money that gets stolen from those systems and have some kind of conceptual buyer protection in them.

564
00:47:20,864 --> 00:47:22,864
Those are more popular.

565
00:47:22,864 --> 00:47:25,864
People like custody and they move to systems that do it.

566
00:47:25,864 --> 00:47:30,864
They move to systems that are custodial because they like them better than systems where they have to take responsibility.

567
00:47:30,864 --> 00:47:35,864
That's very interesting.

568
00:47:35,864 --> 00:47:47,864
And as always, you have a very, very good set of facts and knowledge to show how my narratives are all wrong.

569
00:47:47,864 --> 00:47:51,864
I think mine might be wrong.

570
00:47:51,864 --> 00:47:56,864
I just said that MakerDAO has an admin backdoor to both.

571
00:47:57,864 --> 00:48:01,864
And I just said that Uniswap has an admin backdoor to the Uniswap contracts.

572
00:48:01,864 --> 00:48:03,864
I think it's only a subset.

573
00:48:03,864 --> 00:48:07,864
I don't think their admin backdoor lets them take whatever they want.

574
00:48:07,864 --> 00:48:09,864
But I haven't reviewed the code as much.

575
00:48:09,864 --> 00:48:15,864
I believe it's only for the token they created, the Uniswap token and the MakerDAO token.

576
00:48:16,864 --> 00:48:28,864
But even there, MakerDAO is just about to add the Maker token as a collateral option.

577
00:48:28,864 --> 00:48:32,864
Then they will have backdoor access to the contents of the vault.

578
00:48:32,864 --> 00:48:40,864
The trend is in the direction of let's have more custody and not let's graduate away from being...

579
00:48:40,864 --> 00:48:42,864
They're graduating to custody.

580
00:48:42,864 --> 00:48:44,864
They're not graduating to non-custody.

581
00:48:52,864 --> 00:48:54,864
Interesting.

582
00:48:54,864 --> 00:49:13,864
Well, I would love to learn more about this where there's this dynamic in Ethereum of projects moving in one direction or the other in terms of decentralization or custodial arrangements.

583
00:49:14,864 --> 00:49:37,864
And I guess in support of my original view, we could say that there is some degree of narratives in the direction of projects being set free from their incubation custodial arrangement to a higher realm where they're more decentralized and it's more peer-to-peer and it's less ruggable.

584
00:49:38,864 --> 00:49:45,864
And because that ecosystem traffics in those narratives, there is some interest there.

585
00:49:45,864 --> 00:50:00,864
And that's something which seems like important because there are narratives and then there's reality and there's a kind of relationship that's circular between them.

586
00:50:00,864 --> 00:50:07,864
But you're right to point out that the market is demanding the custodial arrangements, of course.

587
00:50:07,864 --> 00:50:10,864
Tons of people love using Coinbase.

588
00:50:10,864 --> 00:50:14,864
All of those people could just take self-custody of everything they have.

589
00:50:14,864 --> 00:50:17,864
But instead, they use Coinbase.

590
00:50:17,864 --> 00:50:21,864
Coinbase has something like 60 or 100 million customers, I believe.

591
00:50:22,864 --> 00:50:32,864
So tons of people like things that are somehow convenient or fixable by some higher power rather than the totally self-sovereign approach for everything.

592
00:50:32,864 --> 00:50:36,864
So yeah, the market is... go ahead with your thought.

593
00:50:36,864 --> 00:50:40,864
Freedom comes with responsibility.

594
00:50:40,864 --> 00:50:43,864
And if there's one thing people tend to hate, it's personal responsibility.

595
00:50:43,864 --> 00:50:46,864
So consequently, most people don't like freedom.

596
00:50:47,864 --> 00:50:54,864
There's a sense in which this is a really bad situation because freedom is so good and all that.

597
00:50:54,864 --> 00:50:59,864
But also, I like to let people do the things they like.

598
00:50:59,864 --> 00:51:04,864
And if somebody doesn't want to be their own bank, I don't think they should have to.

599
00:51:04,864 --> 00:51:07,864
If they want to use a custodian to make them feel better, go for it.

600
00:51:07,864 --> 00:51:09,864
If that's available, you can do that.

601
00:51:09,864 --> 00:51:15,864
I don't want to do that because I really do value freedom and I value personal responsibility.

602
00:51:16,864 --> 00:51:27,864
Well, well said.

603
00:51:27,864 --> 00:51:31,864
We have a few new excellent people in the audience.

604
00:51:31,864 --> 00:51:37,864
All are welcome to come on up and speak, share a question or comment, hang out on the stage.

605
00:51:37,864 --> 00:51:40,864
Thank you for listening.

606
00:51:40,864 --> 00:51:42,864
I'll take a moment just to reset the room.

607
00:51:43,864 --> 00:51:47,864
This is Drivechain Twitter Spaces run by Henry at LayerTwo Labs.

608
00:51:47,864 --> 00:51:54,864
And I'm thrilled to have these conversations on Twitter twice a week, Mondays and Thursdays,

609
00:51:54,864 --> 00:51:59,864
where we discuss Bitcoin Improvement Proposal 300 and 301,

610
00:51:59,864 --> 00:52:08,864
which I think could be transformatively beneficial for Bitcoin by enabling stronger facilities for sidechains.

611
00:52:08,864 --> 00:52:16,864
I think this is fully aligned with Satoshi's vision that every blockchain in the world would be merge-mined with Bitcoin.

612
00:52:16,864 --> 00:52:26,864
And the peer-to-peer nature of hash rate escrow and blind merge mining would, I think, strengthen Bitcoin in many ways

613
00:52:26,864 --> 00:52:33,864
and perhaps just possibly bring the entire Bitcoin, the entire community of blockchain developers and users,

614
00:52:33,864 --> 00:52:42,864
back onto Bitcoin to use sidechains, which would greatly increase the Bitcoin user count, the Bitcoin security budget,

615
00:52:42,864 --> 00:52:47,864
the Bitcoin value and Bitcoin's political support around the world.

616
00:52:47,864 --> 00:52:55,864
Because if we have the entire crypto community using Bitcoin as its layer one, then there's much more unanimity,

617
00:52:55,864 --> 00:53:02,864
much less time spent arguing with each other, much less adversarial narratives among blockchains.

618
00:53:02,864 --> 00:53:04,864
Right now, blockchains compete.

619
00:53:04,864 --> 00:53:08,864
You should bring Ryan Dale up. Ryan Dale's super smart and I'd love to hear his thoughts on all this stuff.

620
00:53:08,864 --> 00:53:12,864
If you can invite people up to be a speaker, do it for Ryan Dale.

621
00:53:12,864 --> 00:53:20,864
Yeah, Ryan Dale is absolutely one of the best, most favorite. I love Ryan Dale's talks and it's always awesome.

622
00:53:21,864 --> 00:53:28,864
If he wants to come up, he can request to come up. I don't usually ask people to come up.

623
00:53:28,864 --> 00:53:36,864
I let them just come up when they want to because I assume that they're busy and they're driving or they're doing something

624
00:53:36,864 --> 00:53:41,864
and might just be listening casually. But yeah, Ryan Dale, please join the stage every time you're here.

625
00:53:42,864 --> 00:53:50,864
We love it when you talk and it's valuable for people to hear the pros and cons of drivechain.

626
00:53:50,864 --> 00:53:57,864
We don't want to only have supporters on stage. We want to have critics and skeptics share their views.

627
00:53:59,864 --> 00:54:04,864
And Ryan Dale knows a lot more than I do about Bitcoin technologically.

628
00:54:04,864 --> 00:54:13,864
So it's great to have someone like you, SuperTestNet, here to perhaps respond when someone comes on stage who's very sophisticated

629
00:54:13,864 --> 00:54:24,864
and then they can get a sophisticated answer to any comments that are critical or skeptical about drivechain.

630
00:54:26,864 --> 00:54:29,864
So once again, Ryan Dale, please come up if you'd like to.

631
00:54:30,864 --> 00:54:35,864
The thing that really excites me about drivechain, and I think for most people this is probably the strongest selling point,

632
00:54:35,864 --> 00:54:40,864
is drivechain is arguably, potentially, number-go-up technology.

633
00:54:40,864 --> 00:54:50,864
It's technology that can enable higher rates of value accrual to Bitcoin Layer 1, the token and the block space.

634
00:54:50,864 --> 00:54:54,864
Both of those things benefit from higher demand.

635
00:54:54,864 --> 00:55:04,864
When more people are demanding Bitcoin, it sends the Bitcoin price higher because of Bitcoin's price inelastic supply.

636
00:55:06,864 --> 00:55:17,864
And also, the Bitcoin security budget issue, I think, will grow in importance over time as the fees remain low on Layer 1.

637
00:55:18,864 --> 00:55:26,864
So if the fees stay low, people are going to want more and more for there to be a way to get those fees up.

638
00:55:26,864 --> 00:55:31,864
And I think merged mining is Satoshi's own suggestion on how to do that.

639
00:55:31,864 --> 00:55:36,864
He wrote explicitly that merged mining can increase the strength of the network.

640
00:55:36,864 --> 00:55:41,864
And that is what got me into drivechain at the very beginning.

641
00:55:42,864 --> 00:55:48,864
I didn't even understand exactly at first how drivechain increases the value of the Bitcoin token.

642
00:55:48,864 --> 00:55:55,864
I only understood at first how drivechain increases the value of the other good on the Bitcoin blockchain.

643
00:55:55,864 --> 00:56:00,864
There are two goods on the Bitcoin blockchain, the token and the block space.

644
00:56:00,864 --> 00:56:05,864
And the value of the block space is the total transaction fee rate.

645
00:56:05,864 --> 00:56:10,864
And that total transaction fee rate is potentially enormously increased

646
00:56:10,864 --> 00:56:19,864
if there is high demand for merged-mined sidechains or merged-mined altcoins like BitDNS.

647
00:56:19,864 --> 00:56:23,864
That was what Satoshi was talking about when he talked about merged mining.

648
00:56:23,864 --> 00:56:30,864
He hadn't yet understood that there could be a merged-mined sidechain with a two-way peg.

649
00:56:30,864 --> 00:56:37,864
That's something which came later in the Bitcoin development history.

650
00:56:38,864 --> 00:56:42,864
So at first we had just this merged-mined altcoin, BitDNS.

651
00:56:42,864 --> 00:56:48,864
And by the way, I've been remiss in introducing our latest entrant, Raz.

652
00:56:48,864 --> 00:56:50,864
Thanks for joining the stage.

653
00:56:50,864 --> 00:56:55,864
Please chime in with any thoughts or comments you'd like to mention as we're talking.

654
00:56:55,864 --> 00:56:58,864
Cheers, thank you. Yeah, hey guys.

655
00:56:58,864 --> 00:57:05,864
I was really hoping to just mention a project that I'm hoping to get rolling this week.

656
00:57:05,864 --> 00:57:12,864
Last week there was a great tweet that had inspired this idea for a shared community

657
00:57:12,864 --> 00:57:19,864
for all the various L2s at risk of existing within a silo and having great ideas

658
00:57:19,864 --> 00:57:25,864
that don't cross-pollinate and help the overall scaling conversation.

659
00:57:25,864 --> 00:57:30,864
And in order to do that, the thing that I think we should try and what I set up

660
00:57:30,864 --> 00:57:33,864
was just a simple Discord server. It's called Second Layer.

661
00:57:33,864 --> 00:57:37,864
So I was going to invite everybody that's interested, and of course Drivechain,

662
00:57:37,864 --> 00:57:42,864
any of the other scaling projects are welcome to come in there.

663
00:57:42,864 --> 00:57:48,864
I'm hoping we can get buy-in from some of the bigger ones and have more productive conversations

664
00:57:48,864 --> 00:57:55,864
and do it with a nice UX that lets you casually go in and out of messaging

665
00:57:55,864 --> 00:57:59,864
and the voice channel like we get here on Twitter Spaces, which I think is great,

666
00:57:59,864 --> 00:58:00,864
and Discord as well too.

667
00:58:00,864 --> 00:58:05,864
So I'll just probably post a link. I don't know if you want to get it on the handle,

668
00:58:05,864 --> 00:58:12,864
but that was the announcement I wanted to make, so thank you for the platform.

669
00:58:12,864 --> 00:58:20,864
Great. Thank you. That is great.

670
00:58:20,864 --> 00:58:24,864
Well, we are one hour into our Twitter Spaces.

671
00:58:25,864 --> 00:58:33,864
Usually we run until about 11 Pacific, so another half hour, so a total of 90 minutes typically.

672
00:58:33,864 --> 00:58:37,864
Everyone is welcome to come up to the stage, raise your hand,

673
00:58:37,864 --> 00:58:42,864
and share your question or comment about Drivechain.

674
00:58:42,864 --> 00:58:45,864
Drivechain has been around for about seven years,

675
00:58:45,864 --> 00:58:52,864
and recently we've gotten a lot more interest and support for it.

676
00:58:52,864 --> 00:59:01,864
In the last year, the level of enthusiasm and interest for Drivechain has increased significantly.

677
00:59:01,864 --> 00:59:06,864
So one observer told me, who's been watching this space for a year,

678
00:59:06,864 --> 00:59:08,864
this is just one person's opinion.

679
00:59:08,864 --> 00:59:15,864
One person told me that they think the likelihood that Drivechain will be adopted on Bitcoin

680
00:59:15,864 --> 00:59:23,864
in the last year rose from 1% to 5%.

681
00:59:23,864 --> 00:59:25,864
So I think...

682
00:59:25,864 --> 00:59:27,864
Let's give ourselves a clap.

683
00:59:27,864 --> 00:59:28,864
Yeah.

684
00:59:28,864 --> 00:59:30,864
Round of applause for us.

685
00:59:30,864 --> 00:59:36,864
Now, I joined in the last year, so whether that was entirely attributable to me,

686
00:59:36,864 --> 00:59:41,864
that 500% increase, it's unclear. I'm kidding.

687
00:59:41,864 --> 00:59:45,864
Obviously, I'm just a grain of sand in the ocean.

688
00:59:45,864 --> 00:59:51,864
So I talked to someone yesterday who said they've known you in the Bitcoin space for over a year,

689
00:59:51,864 --> 00:59:53,864
because I think you used to work at BlockFi?

690
00:59:53,864 --> 00:59:56,864
Is there a story there?

691
00:59:57,629 --> 01:00:04,969
Yeah. So I got interested in crypto and Bitcoin a couple of years ago, and I joined BlockFi.

692
01:00:04,969 --> 01:00:15,409
That was my first experience in crypto. Knowing very little, never having read a book on Bitcoin or anything, I wanted to work at a crypto company.

693
01:00:15,409 --> 01:00:21,008
I applied to Coinbase, Kraken, BlockFi, Gemini, Galaxy, and I got an offer at BlockFi.

694
01:00:21,008 --> 01:00:25,729
I went there. I was a director in the compliance department for two years.

695
01:00:26,449 --> 01:00:35,089
I loved my job. I was very disappointed in the way that things ended, and everybody is.

696
01:00:36,049 --> 01:00:41,008
And as I reflected on my opportunities, I looked at a bunch of things in Ethereum,

697
01:00:41,968 --> 01:00:47,409
like different companies that were starting with zero knowledge, decentralized exchange,

698
01:00:47,409 --> 01:00:51,328
perpetual futures trading, stuff like that. And I could have gone there.

699
01:00:51,328 --> 01:00:57,488
I could have been the compliance person for some global startup with raising tens of millions

700
01:00:57,488 --> 01:01:02,688
of dollars to do something like that, some kind of decentralized trading stuff.

701
01:01:03,729 --> 01:01:08,209
But at the time, a couple of months ago, when I was making this decision,

702
01:01:09,568 --> 01:01:15,248
I knew about Paul Sztorc and LayerTwo Labs, and I was aware that they had created a website and

703
01:01:15,248 --> 01:01:20,449
were looking to hire some people. And one of the opportunities was to be the marketing person.

704
01:01:21,328 --> 01:01:30,129
And I was looking for a job that was legal and compliance focused. But I talked to Paul,

705
01:01:30,129 --> 01:01:34,849
and I said, I want to do legal and compliance. Do you need someone for that? And he said,

706
01:01:34,849 --> 01:01:40,688
well, I really need a guy to do Twitter spaces or a girl. And you could do both.

707
01:01:40,688 --> 01:01:46,369
You could do the legal compliance, if there's any compliance or legal issues, documenting the hiring

708
01:01:46,369 --> 01:01:51,008
of people, stuff like that. And then in addition, you could run the Twitter spaces. So that's what

709
01:01:51,008 --> 01:01:57,648
I'm doing. I wear two hats at the company. And I definitely chose this opportunity,

710
01:01:58,928 --> 01:02:05,968
not out of necessity, but out of genuine belief that there is an enormous transformative

711
01:02:05,968 --> 01:02:14,688
opportunity for Bitcoin to stop failing, stop losing clout, narrative and value,

712
01:02:15,649 --> 01:02:25,248
stop this trend toward losing the market cap crown, and instead adopt drivechain and begin

713
01:02:25,248 --> 01:02:34,929
to build upward back to 100% dominance. So for me, it's a very dramatic thing. Very dramatic.

714
01:02:38,049 --> 01:02:43,888
Look, this is my opinion. I'm not saying this is the future. But just everyone has their outlook

715
01:02:43,888 --> 01:02:52,049
on crypto. So I like to share mine, which is that the lack of drivechain is the problem.

716
01:02:52,769 --> 01:02:57,728
And if it's not, if it's never adopted, I think Bitcoin will get flipped. And there'll be a

717
01:02:57,728 --> 01:03:05,649
security budget problem. And Ethereum will just like take over the world. But I understand a lot

718
01:03:05,649 --> 01:03:09,649
of people would say, Henry, you're crazy. Ethereum is irrelevant. It doesn't matter what they're

719
01:03:09,649 --> 01:03:14,688
doing. But I feel like that's just willful blindness. I feel like there's substantial

720
01:03:14,688 --> 01:03:23,808
kernels of truth in what they're doing and their narratives. Let me put it this way. If I or

721
01:03:23,808 --> 01:03:30,129
anybody wanted to attack Bitcoin, I think the best thing to do would be to say, don't do drivechain.

722
01:03:30,129 --> 01:03:36,448
Just do money. Don't do anything interesting. Don't try to build a prediction market on Bitcoin.

723
01:03:36,448 --> 01:03:45,489
Don't try to build sidechains for privacy, for scalability, for NFTs. Don't don't do any of that.

724
01:03:45,489 --> 01:03:51,088
Just be simple. Just do payments. Digital gold. Because I think this in other words,

725
01:03:51,088 --> 01:03:56,929
this digital gold narrative is terrible. Like gold is a failure. It doesn't have any extensibility.

726
01:03:56,929 --> 01:04:04,209
Like I mean, barely you can make a little ring out of it or a coin. Right. And so it's pretty

727
01:04:04,209 --> 01:04:09,328
limited. But what if it was digital? Well, I just think the digital gold narrative,

728
01:04:09,328 --> 01:04:15,728
it's double edged sword, because on the one hand, sure, if the whole world grocks Bitcoin and buys

729
01:04:15,728 --> 01:04:20,929
it, yes, the value could go to 200 million dollars. I mean, 200 trillion dollars. We could

730
01:04:20,929 --> 01:04:27,489
have a 200 trillion dollar digital gold layer. That's the base layer of the entire economy.

731
01:04:27,489 --> 01:04:34,529
And everyone's trading Bitcoin, IOUs or or lightning. And that like, yes, everyone in the

732
01:04:34,529 --> 01:04:39,489
whole world is like, you know, you and Reindald and like everyone will just be like totally

733
01:04:39,489 --> 01:04:45,888
Bitcoin only. Awesome. And that could happen. That could logically happen. It's possible.

734
01:04:45,888 --> 01:04:53,408
But I do feel there are powerful narratives in the altcoin community that constitute a legitimate

735
01:04:53,408 --> 01:04:57,969
competitor, a threat to the protocol, because in protocols you want to be number one. So I don't

736
01:04:57,969 --> 01:05:03,888
want to see Bitcoin lose its number one status. Bitcoin has, to me, a more libertarian culture.

737
01:05:03,888 --> 01:05:09,089
And that's why I like it. And that's why I felt comfortable going to a Bitcoin only company,

738
01:05:10,049 --> 01:05:14,689
because I feel like the libertarian movement is stronger within Bitcoin. That's ultimately

739
01:05:14,689 --> 01:05:21,489
why I chose Bitcoin when I really had like a choice is that, you know, it's like the Austrian,

740
01:05:21,489 --> 01:05:29,809
the Austrian economics and cypherpunk ethos of like of sort of volunteerism, anarcho-capitalism,

741
01:05:30,369 --> 01:05:35,888
limited government, you know, freedom, individual economic freedom, the site like the

742
01:05:36,689 --> 01:05:43,089
sovereign individual book. Those kinds of ideas, I feel, are more in Bitcoin than in the altcoins.

743
01:05:43,089 --> 01:05:47,649
So I would like for there I would therefore like to see Bitcoin succeed. But I think that what we

744
01:05:47,649 --> 01:05:54,128
need are these sidechains to make really cool projects that might become very large. And even

745
01:05:54,128 --> 01:05:59,969
if they don't, would just make Bitcoin show that it has extensibility. It has cool stuff. And that

746
01:05:59,969 --> 01:06:06,529
would be a powerful narrative game in money. It's all like memes, narratives. It's not just tech.

747
01:06:06,529 --> 01:06:11,809
It's the narratives that are important. We want to have Bitcoin stay the biggest and the most

748
01:06:11,809 --> 01:06:19,649
exciting. So I think that this sort of monetary maximalism, limited view of blockchain is not

749
01:06:19,649 --> 01:06:24,929
right. This idea that altcoins have no legitimate tech and that they're all scams is wrong,

750
01:06:25,568 --> 01:06:31,489
because like peer-to-peer oracles, like hivemind projects like that, we don't want them to be on

751
01:06:31,489 --> 01:06:37,728
altcoins. They're legitimate. We want them on Bitcoin, big block sidechains. They're not scams.

752
01:06:38,369 --> 01:06:42,769
Like the people who left Bitcoin to do big blocks, it would have been better if they had stayed and

753
01:06:42,769 --> 01:06:49,888
done drivechain. But drivechain still isn't possible yet. So I think we need to change,

754
01:06:49,888 --> 01:06:56,769
like as Bill Clinton always used to say, we've got to change. And I just don't understand really why

755
01:06:57,328 --> 01:07:03,249
the most influential thinkers in Bitcoin don't all agree on this. Like we've got Adam Back,

756
01:07:03,249 --> 01:07:11,568
but there's a bunch of very, very influential thinkers who are quiet on the issue or who have

757
01:07:11,568 --> 01:07:19,568
criticized it years ago. And like, I wonder if they're still confident in their view, because

758
01:07:19,568 --> 01:07:26,689
every day the fees are low and the altcoins are growing. So in the worst case scenario,

759
01:07:26,689 --> 01:07:32,769
the altcoin, the biggest one, like flips Bitcoin and then like shrinks its block size,

760
01:07:33,408 --> 01:07:38,929
ossifies its layer one, and then it has the drivechain approach. And now it's bigger and better.

761
01:07:39,649 --> 01:07:44,448
I mean, I know that sounds like, hey, how could that ever be? But this notion that Bitcoin will

762
01:07:44,448 --> 01:07:49,249
always be perfect, I think it originates from sophistry. It originates from the idea that

763
01:07:49,249 --> 01:07:55,008
because it was first, it therefore is best. It's like, I'm not going to name names, but some people,

764
01:07:55,089 --> 01:08:00,128
some prominent podcasters and whatnot say, well, it was the first digitally scarce thing. And

765
01:08:00,128 --> 01:08:07,089
therefore it, because Bitcoin was the invention of digital scarcity, it will forever be the only

766
01:08:07,649 --> 01:08:16,209
legitimate digitally scarce protocol asset. That's not true. And Satoshi himself didn't even say that.

767
01:08:17,809 --> 01:08:23,809
Like, where did this come from? This sort of simplistic sophistry that because Bitcoin was

768
01:08:23,809 --> 01:08:30,848
first, it therefore is the only legitimate thing ever on blockchain. Like, I don't see that it

769
01:08:30,848 --> 01:08:35,809
doesn't like I majored in philosophy, I can kind of detect when someone's like, sort of just with

770
01:08:35,809 --> 01:08:40,449
like just inventing a false line of reasoning. I don't find that line of reasoning compelling.

771
01:08:40,449 --> 01:08:45,249
Like, of course, it was first, and therefore it had a huge advantage. But now it's blowing that

772
01:08:45,249 --> 01:08:50,369
advantage by not optimizing in the direction of drivechain. I mean, in my personal opinion.

773
01:08:50,929 --> 01:08:52,129
Super, please chime in.

774
01:08:55,648 --> 01:09:03,889
Yeah, so I want to go back to what you were saying about hardforks, which you said, you wish

775
01:09:03,889 --> 01:09:11,168
the vCash people had stayed in order to work on a drivechain instead of vCash. I think that's true.

776
01:09:11,168 --> 01:09:17,009
If we'd had drivechains at the time, that would have been a better outcome. One thing that is

777
01:09:17,009 --> 01:09:22,288
very difficult for Bitcoiners to hear is the concept that hardforks are a good thing. Many

778
01:09:22,288 --> 01:09:29,809
people view them as a very big danger. And it's something that Bitcoin lately tries to

779
01:09:29,809 --> 01:09:36,208
avoid doing. But I have a perspective that hardforks are actually a good thing. I think

780
01:09:36,208 --> 01:09:44,449
hardforks are, they've got lots of benefits. But I found a way to say that, that it doesn't wrinkle

781
01:09:44,528 --> 01:09:50,129
the foreheads of Bitcoiners. There's a way to say that that makes Bitcoiners say, oh yeah,

782
01:09:50,129 --> 01:09:57,408
I agree with that. And it is that I'm glad that the vCash people left. I'm glad they left Bitcoin.

783
01:09:58,288 --> 01:10:02,848
And when I say that to people, they're like, oh yeah, yeah, I'm so glad they left. It's good that

784
01:10:02,848 --> 01:10:07,168
we've gotten rid of those people. But what they don't realize is by saying that, they're saying

785
01:10:07,168 --> 01:10:11,728
they're in favor of the hardfork, because that's what vCash was. It was a hard, you can't leave

786
01:10:11,728 --> 01:10:18,848
Bitcoin, or the vCash people couldn't have left Bitcoin without doing a hardfork. One of the

787
01:10:18,848 --> 01:10:23,168
things I like about them though, is that it lets people run the software they want. The vCash

788
01:10:23,168 --> 01:10:28,449
people wanted big blocks so that they hardforked and they got them. I think that's great that they

789
01:10:28,449 --> 01:10:32,929
get to run the software they like, we get to run the software we like, may the best money win.

790
01:10:33,889 --> 01:10:41,648
But yeah, that was also before drivechains, where no one was, they were much less likely to get

791
01:10:41,648 --> 01:10:46,449
activated at that time than they are now. So there's kind of a different scenario now, where

792
01:10:46,449 --> 01:10:51,648
if you, where they could have big blocks without a hardfork now, and then also run the code that

793
01:10:51,648 --> 01:10:59,569
they like, the big block code, but not have to completely depart Bitcoin for it. So I don't

794
01:10:59,569 --> 01:11:02,608
know, I thought that people might be interested in hearing that perspective.

795
01:11:04,528 --> 01:11:11,009
That's interesting you say that, because when I've read Paul's blog posts, it's on truthcoin.info,

796
01:11:11,009 --> 01:11:17,329
it seems like he is emphatically against hardforks. He views hard, and I think it makes sense to me,

797
01:11:17,329 --> 01:11:23,648
because it's a crypto economic claim, which is my favorite part of Bitcoin is the economics,

798
01:11:23,648 --> 01:11:30,848
as opposed to the code. And economically, when a protocol forks, it loses users,

799
01:11:32,049 --> 01:11:40,369
it loses resources. So if you know, Bitcoin splits, like it did with Bitcoin Cash, 20%

800
01:11:40,369 --> 01:11:47,809
of the resources were gone for Bitcoin. The 20% of the users, the miners, that sort of thing.

801
01:11:47,809 --> 01:11:52,049
That's a rough number, I could be wrong about it. But I think I recall that from a blog post,

802
01:11:52,608 --> 01:11:57,569
that it was about 20% of the community broke off, that was damaging to the community.

803
01:11:58,208 --> 01:12:05,329
It's much better for the community to remain whole, and for it to instead have more extensibility,

804
01:12:05,329 --> 01:12:11,168
so that people with different ideas can build on the project without completely leaving.

805
01:12:12,288 --> 01:12:19,809
Like imagine how much poorer America would be if it split in half. And, you know, it would

806
01:12:19,809 --> 01:12:24,768
have half as much, you know, network effect for its money and its military. Now, of course,

807
01:12:24,768 --> 01:12:29,329
that's a bad analogy, because like, probably among libertarians, we all want that to happen.

808
01:12:30,689 --> 01:12:34,449
Ideal scenario, we have drivechains, and they don't have to leave Bitcoin in order to run a big

809
01:12:34,449 --> 01:12:39,968
block, you know, blockchain, they can just do it. Well, they can just make a sidechain that does

810
01:12:39,968 --> 01:12:47,249
that. But also, in the absence of that option, in the absence of drivechain, I think that better

811
01:12:47,249 --> 01:12:52,528
than people staying with Bitcoin, if they don't like it, it's better if they leave it for something

812
01:12:52,528 --> 01:12:58,528
they do like, even if they take 20% of their value with them. I think it's more important

813
01:12:58,528 --> 01:13:04,288
that they do what they like, rather than do something they don't like. So I'm a fan of,

814
01:13:04,929 --> 01:13:09,728
because we had no drivechain option at the time, I think it's better that the big cash people were

815
01:13:09,728 --> 01:13:15,088
able to leave and then make something they like better. And, you know, but it made the best money

816
01:13:15,088 --> 01:13:19,408
win. But so far, Bitcoin's winning by a lot, compared to that one.

817
01:13:20,208 --> 01:13:25,648
So that, yeah, I agree that obviously, Bitcoin is the, by far the most successful of all of the

818
01:13:25,648 --> 01:13:32,288
Bitcoin block, you know, Bitcoin related blockchains, certainly. But I agree with you that

819
01:13:32,288 --> 01:13:37,648
sometimes forking off, you know, getting divorced, sometimes that makes sense. It's a matter of,

820
01:13:38,369 --> 01:13:45,408
you know, how urgent does one feel, one wants to do the technology that one prefers.

821
01:13:46,129 --> 01:13:51,889
And if there's no extensibility, that's adequate, then you have to fork and do something new.

822
01:13:53,009 --> 01:14:00,049
When I read the Ethereum white paper, and Vitalik says that, you know, he talks about colored coins

823
01:14:00,049 --> 01:14:07,329
and other types of projects that were attempts at Bitcoin extensibility. So he reviews the history

824
01:14:07,329 --> 01:14:13,009
of people trying to build on Bitcoin. And he discusses the ways in which they were limited

825
01:14:13,009 --> 01:14:20,449
by Bitcoin's foundational architecture. He never talks about drivechain. Of course,

826
01:14:20,449 --> 01:14:25,648
I think Ethereum predated drivechain. I think Ethereum was 2014 and drivechain was 2015.

827
01:14:27,408 --> 01:14:31,728
So it's interesting. Your point about...

828
01:14:32,129 --> 01:14:37,489
It did. The concept of Ethereum did predate the specific drivechain proposal, but it didn't

829
01:14:37,489 --> 01:14:45,889
predate the concept of merge-mined two-way pegs, of which drivechain is one attempt to implement

830
01:14:45,889 --> 01:14:51,168
that. The sidechains white paper also proposed them using SPV probes. And that came out before

831
01:14:51,168 --> 01:14:56,049
Ethereum. In fact, Ethereum was widely criticized because they didn't go with a two-way peg model.

832
01:14:56,768 --> 01:15:01,809
They went with having a floating currency. First, they did because they didn't know how.

833
01:15:02,689 --> 01:15:05,489
Partly, they did it because they didn't know how to make a two-way peg at the time.

834
01:15:06,768 --> 01:15:10,449
Would the two-way peg have been federated? Are you saying that Ethereum could have just done

835
01:15:10,449 --> 01:15:16,768
what Rootstock did and that that architecture was known and understood at the time of Ethereum's

836
01:15:16,768 --> 01:15:22,288
launch that they could have done a federated sidechain? They could have done a federated

837
01:15:22,288 --> 01:15:25,809
sidechain. And that was, if I remember correctly, that was proposed. In fact,

838
01:15:25,809 --> 01:15:34,768
they were criticized for not doing that. But the sidechain's white paper in 2014

839
01:15:34,768 --> 01:15:40,929
proposed that as something you can do in the meantime until we get a soft fork

840
01:15:40,929 --> 01:15:46,848
that allows Bitcoin to validate SPV groups. And so there was also a criticism of like,

841
01:15:46,848 --> 01:15:50,449
just wait another year or two and we'll soft fork in this alternative. It's better.

842
01:15:55,728 --> 01:16:03,329
All right. Well, anyone in the audience who would like to come up and join the stage

843
01:16:03,329 --> 01:16:11,569
to share a comment or question about drivechain is welcome to. In the nest, we have two tweets.

844
01:16:11,569 --> 01:16:19,968
One is a recent article by MaxMoney21Million. He wrote an essay on drivechain,

845
01:16:20,608 --> 01:16:26,129
and I tweeted a link to it. Ah, we have Reindahl joining the stage.

846
01:16:30,049 --> 01:16:34,129
Hello, sir. How's it going? I'm all right. How are you?

847
01:16:35,168 --> 01:16:38,848
I'm well, thanks. Please chime in with thoughts and criticisms and

848
01:16:39,408 --> 01:16:47,168
anything on the topics we've discussed. I missed a lot of it, but was just listening in

849
01:16:47,168 --> 01:16:53,009
recently. I don't know if you guys have talked about it before, but I think Supertestnet has

850
01:16:53,968 --> 01:16:59,329
sort of a sketch of a design up for a thing called Handcrank, which is like, I'll call it

851
01:16:59,329 --> 01:17:05,089
drivechain's light, but doesn't take a soft fork. And I was reflecting on that design.

852
01:17:05,809 --> 01:17:13,248
And I think we're going to want some kind of covenant opcodes inside of Bitcoin,

853
01:17:13,888 --> 01:17:23,408
which covenant that is, is grist for some healthy debate. But it occurred to me that I think if you

854
01:17:23,408 --> 01:17:33,488
had a covenant opcode, you could actually do drivechains without BIP300 and BIP301. And

855
01:17:35,089 --> 01:17:39,569
the way that that would work is it would be something like, and I'm going to be a little

856
01:17:39,569 --> 01:17:48,449
bit hand-wavy, but Supertestnet had a really interesting idea around if miners include a pub

857
01:17:48,449 --> 01:17:59,248
key in their Coinbase op returns, then you could look back on the past n number of blocks, 50,

858
01:17:59,248 --> 01:18:06,288
100, whatever, and you could build yourself a little multi-sig where the keys are held by

859
01:18:07,008 --> 01:18:12,128
miners from the last however many blocks. And one of the things that's really interesting

860
01:18:12,128 --> 01:18:23,569
about that is you could do something like you say, I'm going to take the pub keys from the

861
01:18:23,569 --> 01:18:32,768
last hundred blocks. I'm going to build a frost threshold signing key where it's a one out of 50.

862
01:18:32,768 --> 01:18:39,008
So any of the miners can sign with this key, but only the miners can sign. And if you had that,

863
01:18:41,329 --> 01:18:50,049
and if you also have a covenant where you say a given output can be moved forward to another

864
01:18:50,049 --> 01:18:58,128
output that has a one block relative time lock on it, and there's six months worth of those

865
01:18:58,128 --> 01:19:05,168
movements forward that it can do. And then at the end of those six month line of transactions, then

866
01:19:06,609 --> 01:19:11,648
you can send it wherever it needs to go. That actually basically does hashrate escrow,

867
01:19:12,209 --> 01:19:18,049
but it can be any transaction in the blockchain can be encumbered by hashrate escrow. It doesn't

868
01:19:18,049 --> 01:19:24,128
just have to be these special slots in the Coinbase, which is what BIP300 does.

869
01:19:24,128 --> 01:19:28,368
So I just thought that it was interesting that because we have relative time locks

870
01:19:28,368 --> 01:19:37,008
and because with Taproot we now have much clever key aggregation. If you had something where you

871
01:19:37,008 --> 01:19:46,929
said the only allowed spend path for this output is to move forward to another state in a line of

872
01:19:46,929 --> 01:19:53,089
states, and after the last one, the coins can be spent anywhere, then you could basically do

873
01:19:53,089 --> 01:19:58,849
hashrate escrow. And yeah, that's super interesting. And then I think if you also

874
01:19:59,921 --> 01:20:10,401
do an output that's like a anyone can spend, like you sign it with sig hash none and sig hash anyone

875
01:20:10,401 --> 01:20:16,161
can pay, then that's like an output that anybody can put in, or I'm sorry, that's a transaction

876
01:20:16,161 --> 01:20:20,801
where anybody can replace the output and it's still valid. So if you were to make transactions

877
01:20:20,801 --> 01:20:26,320
like that, then miners could replace the output with their own address, and that's a way that

878
01:20:26,721 --> 01:20:34,480
you could anchor sidechain blocks by basically bribing miners. So I think those two constructions

879
01:20:34,480 --> 01:20:42,241
actually replace BIP300 and 301, and it's a much smaller set of forks because instead of having

880
01:20:42,960 --> 01:20:50,800
BIP300, which is a fairly complex thing, you just need a covenant system. So if you had CTV,

881
01:20:50,800 --> 01:20:53,280
you could build drivechains. I just think that's really interesting.

882
01:20:53,440 --> 01:20:59,681
Yeah, so there's a couple of people who have demonstrated or proposed ways of emulating

883
01:20:59,681 --> 01:21:08,960
a hashrate escrow using BIP119 or BIP118. Ruben Somsen has a post on Twitter in which he

884
01:21:08,960 --> 01:21:12,320
outlined something called simplified drivechains, which you can search for if you want to look

885
01:21:12,320 --> 01:21:19,361
up more about that, which uses BIP119 to do it, which is BIP119 is also known as

886
01:21:19,441 --> 01:21:25,361
opchecktemplateverify. Zman is a Bitcoin developer on the Bitcoin developer mailing list

887
01:21:25,361 --> 01:21:34,320
who proposed a way to do it using BIP119. Because he opposes hashrate escrows, he opposes BIP300,

888
01:21:34,320 --> 01:21:40,001
he actually gave this as a reason to also oppose BIP119. He was like, you can do drivechains with

889
01:21:40,001 --> 01:21:47,361
BIP119 and drivechains are bad, therefore we should not activate BIP119. And then Jeremy Rubin

890
01:21:47,361 --> 01:21:54,240
posted on his blog, how you can emulate a hashrate escrow using BIP118, which is a

891
01:21:54,240 --> 01:21:59,121
SIGHASH anypreval. So there's a couple of different ways to do it, which I think is

892
01:21:59,121 --> 01:22:04,001
interesting because also the reverse is true. If we get BIP300 before we get those things,

893
01:22:04,001 --> 01:22:10,720
you can also emulate them by just making a sidechain that has a BIP118 sidechain or a BIP119

894
01:22:10,720 --> 01:22:16,320
sidechain. So all of these things can emulate each other, which I think is just fascinating.

895
01:22:16,880 --> 01:22:17,600
No, it's super cool.

896
01:22:17,600 --> 01:22:19,121
If you get one, you get them all.

897
01:22:19,121 --> 01:22:24,080
Yeah. And maybe I read something that Jeremy wrote and it's just been rattling around in the

898
01:22:24,080 --> 01:22:27,681
back of my head. And then I woke up one day and thought I had independently discovered it. That

899
01:22:27,681 --> 01:22:33,520
happens all the time, especially the things that Jeremy writes. He just has a lot of really good

900
01:22:33,520 --> 01:22:45,681
ideas. It's funny, one of my big gripes with 300 and 301 is I think it introduces a lot of weird

901
01:22:45,681 --> 01:22:53,360
political and incentive distortions to the miner ecosystem. So I would actually prefer

902
01:22:54,240 --> 01:23:03,121
something like a, I'll call it a permissionless drivechain system. If you emulate hash rate

903
01:23:03,121 --> 01:23:08,800
escrow and blind merge mining with something like CTV or OPTX hash or something else.

904
01:23:08,800 --> 01:23:13,600
Because there's a couple of things I don't like about the current drivechain design,

905
01:23:13,600 --> 01:23:26,080
but one of them is slots for sidechains in the BIP300 little registry of sidechain withdrawals.

906
01:23:29,440 --> 01:23:37,041
That's a scarce resource and miners have to ultimately decide which ones they activate.

907
01:23:37,041 --> 01:23:41,281
And the way that you activate those is basically by going through a soft fork.

908
01:23:41,761 --> 01:23:47,921
So in some ways you could look at drivechains as being like the soft fork to end all soft forks,

909
01:23:47,921 --> 01:23:52,561
but in other ways we would actually have more soft forks because we would have a big

910
01:23:53,761 --> 01:23:58,240
miner activated soft fork exercise every time somebody wants to turn on a new drivechains.

911
01:24:01,681 --> 01:24:05,041
Soft forks are a big enough pain in the ass now. I don't know if we want to turn

912
01:24:05,121 --> 01:24:13,761
every possible sidechain into a new soft fork activation campaign. Whereas if you said anybody

913
01:24:13,761 --> 01:24:19,920
anywhere can make a sidechain whenever they want by just doing this covenant construction

914
01:24:20,561 --> 01:24:28,080
and then paying miners to do it, that seems like it doesn't really do anything to help

915
01:24:28,640 --> 01:24:33,281
the maybe MEV concerns, but it certainly gets us out of the whole,

916
01:24:33,841 --> 01:24:41,681
oh God, it's Tuesday, we got a soft fork again problem. I think it's interesting. I think it's

917
01:24:41,681 --> 01:24:47,441
actually kind of preferable to having special space in the coinbase just for drivechains.

918
01:24:47,441 --> 01:24:52,640
I'd much rather have a more general construction that you could just so happen to use for this

919
01:24:52,640 --> 01:24:57,920
kind of action. Because what drivechains really are is they're a big federated multisig,

920
01:24:57,920 --> 01:25:03,441
but they're a big federated multisig held by all of the miners. And so the decentralization of the

921
01:25:03,441 --> 01:25:09,040
big federated multisig is as good as the decentralization of your miners. And I think

922
01:25:09,040 --> 01:25:15,841
that your approach plus covenants gets you maybe not all the way there, but pretty close.

923
01:25:16,001 --> 01:25:22,080
A difference that I value between drive chaining and today's federated sidechains is the dynamic

924
01:25:22,080 --> 01:25:27,920
membership sets, the mining poolers that is. There are a lot of miners and they come and go daily,

925
01:25:27,920 --> 01:25:36,321
people turn on and turn off mining equipment. And so the number of people or the set of people

926
01:25:36,321 --> 01:25:40,161
who you're trusting with your money actually changes on a day-by-day basis, which I think

927
01:25:40,640 --> 01:25:44,960
is an improvement. I don't know if it's an improvement over a federated sidechain,

928
01:25:44,960 --> 01:25:49,520
but it's different enough that some people prefer it. And I think that's very reasonable to do.

929
01:25:49,520 --> 01:25:56,561
Yeah, I think so. Yeah, I tend to agree. I think you might be able to do something where you say

930
01:25:56,561 --> 01:26:02,561
it's a closed membership set for the duration of this withdrawal attempt. That's better than

931
01:26:02,561 --> 01:26:08,561
saying we have a static membership set. But I agree with that. It's a closed membership set.

932
01:26:08,960 --> 01:26:15,841
But I agree, the dynamic membership set thing is really important. One of the other concerns that

933
01:26:15,841 --> 01:26:20,561
I have... So another issue though, I wanted to take issue with something you said, which is that

934
01:26:21,360 --> 01:26:29,601
you were talking about how with BIP300, every new sidechain is a softboard. I don't think that's

935
01:26:29,601 --> 01:26:38,881
quite true. But even if it is, if it is true, doing this with covenants instead,

936
01:26:38,881 --> 01:26:43,200
emulating a hash rate escrow with a covenant doesn't fix that, I don't think. Because

937
01:26:44,881 --> 01:26:49,281
you still have to deposit money with miners and they still have to know what rules that

938
01:26:49,281 --> 01:26:52,321
they're supposed to follow in order to let people peg out of that hash rate escrow.

939
01:26:53,281 --> 01:26:59,360
So in order for them to do that, they have to run this extra software if they want to be part of

940
01:26:59,360 --> 01:27:03,601
this hash rate escrow. And that's essentially a software thing. This is another instance of

941
01:27:03,601 --> 01:27:09,520
miners having to... You have to convince them to run your special software, follow the consensus

942
01:27:09,520 --> 01:27:13,681
rules of this alternative sidechain in order to know who's supposed to be able to peg out.

943
01:27:15,200 --> 01:27:21,281
So it still is. They still have to do a miner-activated software effectively every

944
01:27:21,281 --> 01:27:25,121
time somebody wants to add a new sidechain, even if you emulate this with covenants.

945
01:27:25,920 --> 01:27:30,080
But also the other thing is that if we get one drivechain, that's all we need.

946
01:27:31,121 --> 01:27:35,920
We don't need to get miners to run new sets of software every time, because once we have one,

947
01:27:35,920 --> 01:27:41,841
we can put rollups on it or just do more drivechains off of it and then have that set of

948
01:27:41,841 --> 01:27:49,601
miners who are inside that drivechain are the new set of people. So yeah, I don't think you really

949
01:27:49,601 --> 01:27:56,321
do need to do a new software for everyone. So if we end up in a situation where we have

950
01:27:56,321 --> 01:28:04,881
one killer sidechain, we have the capacity for 256 sidechains, but we say, okay, we actually

951
01:28:04,881 --> 01:28:09,681
only need one of them because inside of that sidechain, we're going to have rollups. And

952
01:28:10,640 --> 01:28:17,360
rollups give us so much extensibility and expressiveness that it's all that we ever

953
01:28:17,360 --> 01:28:23,601
need. People just add new rollups all the time. Why don't we just go straight to having some

954
01:28:24,960 --> 01:28:35,201
ZKP opcode in layer one and just do rollups on Bitcoin? I think one of my biggest pause points

955
01:28:35,201 --> 01:28:42,961
for drivechains is I think drivechains are kind of the best solution with circa 2015 technology.

956
01:28:42,961 --> 01:28:51,761
But over the last 10 years, ZKStarks have gone from being a very theoretical thought exercise

957
01:28:51,761 --> 01:28:57,920
to actually being in production and protecting hundreds of billions of dollars. And the rate of

958
01:28:58,720 --> 01:29:05,761
discovery and invention and innovation in succinct ZKPs is just parabolic.

959
01:29:07,761 --> 01:29:12,480
I think it's a pretty reasonable claim to be able to say, I bet within five years,

960
01:29:12,561 --> 01:29:18,160
there will be some ZKP construction that would be suitable on Bitcoin in terms of

961
01:29:18,160 --> 01:29:24,641
validation costs and proof size. So if that's the trend that it's going, and if ZKPs give us

962
01:29:25,521 --> 01:29:29,521
all of the trustless pegout goodness that we're looking for for drivechains, but without

963
01:29:31,681 --> 01:29:35,681
additional incentive distortions or miner centralization concerns,

964
01:29:36,240 --> 01:29:38,081
it seems like that would be a strictly better solution.

965
01:29:38,641 --> 01:29:47,040
Yeah, we have LayerTwo Labs who exist and is pushing for drivechains. And I think that's great.

966
01:29:47,040 --> 01:29:54,081
Here I am in this space pushing for them because this is one of the most likely avenues to get

967
01:29:54,081 --> 01:30:02,081
a two-way peg into Bitcoin. But also, if there was a rollup labs, similar to LayerTwo Labs,

968
01:30:02,081 --> 01:30:06,720
a rollup labs who was pushing for that, and they had code ready, and they had an example

969
01:30:07,040 --> 01:30:14,961
implementation of start proofs, top code, I'd be in there. Telegram, too. There's Twitter spaces,

970
01:30:14,961 --> 01:30:18,800
too, talking about how we should activate that. Because I just want the two-way peg. I don't

971
01:30:18,800 --> 01:30:26,081
particularly care how we get it. No, that's not true. I do care how we get it. But rollups are

972
01:30:26,081 --> 01:30:31,840
good, too. I'm willing to accept that. Currently, I think the most likely avenue to get drivechains

973
01:30:31,920 --> 01:30:41,040
or drivechain-like things into Bitcoin is because of L2. BIP-118, or SIG-HASH-ANY-PREPOUT,

974
01:30:41,040 --> 01:30:46,001
is very popular among the Lightning community because it also brings a lot of features that

975
01:30:46,001 --> 01:30:51,920
improve the Lightning network. And so I think we're pretty likely to get BIP-118 into Bitcoin.

976
01:30:52,561 --> 01:30:58,881
And once we do, then I think that's our avenue. We use that to emulate BIP-300s, Hashrate, Escrow,

977
01:30:59,521 --> 01:31:07,360
and boom. We've got, effectively, drivechains on Bitcoin. Because BIP301 is less important.

978
01:31:07,360 --> 01:31:11,681
It's not even necessary to activate drivechains. It makes them a lot cleaner. But you can do

979
01:31:12,400 --> 01:31:18,081
BIP301, or you can do blind merge mining today. You don't need BIP301 to do that.

980
01:31:18,881 --> 01:31:21,521
It's just a better version of blind merge mining than we can do today.

981
01:31:22,240 --> 01:31:26,480
So yeah, all the ingredients we have to make drivechains will be here if we get BIP-118.

982
01:31:26,480 --> 01:31:30,081
And I think it's pretty likely we will because all the Lightning people want it.

983
01:31:30,081 --> 01:31:32,881
And they've got a lot of pull in the network.

984
01:31:34,480 --> 01:31:39,360
The question of roll-ups versus drivechain is interesting.

985
01:31:39,360 --> 01:31:45,441
Reindahl, you mentioned the roll-ups. And I wanted to point you to a statement made by

986
01:31:45,441 --> 01:31:52,081
John Light in Twitter Spaces here at LayerTwo Labs Twitter Spaces a few weeks ago.

987
01:31:52,081 --> 01:31:58,561
I put it in the nest. I transcribed it where he said, and people can listen to the entire audio

988
01:31:58,561 --> 01:32:03,681
to get the full context. But he said, I think it would make sense to do drivechains first

989
01:32:03,681 --> 01:32:11,280
rather than wait until validity roll-ups are ready. So that's John Light of Bitcoinrollups.com.

990
01:32:12,160 --> 01:32:18,480
He works for Sovereign. And he's a researcher focused on roll-ups for Bitcoin.

991
01:32:18,480 --> 01:32:23,600
So there's this idea that we could just wait five years and get roll-ups.

992
01:32:23,600 --> 01:32:30,081
But there's no guarantee that things will ever happen in the most optimistic sense.

993
01:32:30,641 --> 01:32:37,441
Maybe it's better to adopt a lower technology that might actually accelerate roll-ups on Bitcoin.

994
01:32:37,441 --> 01:32:43,121
Because as SuperTestNet described, the roll-ups could be done on the drivechain first.

995
01:32:43,761 --> 01:32:46,720
And then that would perhaps, if it sees a lot of success,

996
01:32:47,360 --> 01:32:50,800
accelerate the interest in bringing them down to Layer 1.

997
01:32:52,480 --> 01:32:57,280
I think Paul Sztorc also said recently that Taproot might have come sooner to Bitcoin

998
01:32:57,280 --> 01:33:00,800
instead of taking five years. It might have come sooner to Bitcoin,

999
01:33:02,001 --> 01:33:05,280
although I'm not sure when exactly it was first proposed. But my point is that it wouldn't have

1000
01:33:05,280 --> 01:33:10,800
taken as many years and months as it did had there been drivechains. Possibly drivechains

1001
01:33:10,800 --> 01:33:17,040
can accelerate the adoption of things coming down to Layer 1 because of the ability to run

1002
01:33:17,040 --> 01:33:22,081
them as a live test on a drivechain first. So it enables that kind of experimentation.

1003
01:33:22,081 --> 01:33:29,040
Instead of a mere testnet, it's like a live Layer 2. So that's a superior way, perhaps,

1004
01:33:29,040 --> 01:33:34,081
of getting things brought down to Layer 1. So you might see roll-ups faster on Bitcoin

1005
01:33:34,081 --> 01:33:38,480
if there's drivechains first. That's the theory that some have said.

1006
01:33:40,881 --> 01:33:44,561
Yeah, I think that's a reasonable theory, because drivechains are so close.

1007
01:33:45,360 --> 01:33:48,561
You're really right there. You just need a way to do hashrate escrow,

1008
01:33:48,561 --> 01:33:55,441
and there's several different ways to do it. And then you can put roll-ups on a drivechain and have

1009
01:33:55,441 --> 01:34:00,081
a two-way peg and do another two-way peg. And the world will be glorious. Two-way pegception

1010
01:34:00,081 --> 01:34:04,400
all the way down. To what SuperTestNet said,

1011
01:34:04,400 --> 01:34:10,480
there's a lot of ways to emulate hashrate escrow. So maybe what ends up happening is we get

1012
01:34:10,800 --> 01:34:17,201
Anyprev out, or we get some other covenant system. I mean, shit, maybe we get OP_VAULT,

1013
01:34:17,201 --> 01:34:25,280
and then people use OP_VAULT to emulate hashrate escrow. And boom, now we have

1014
01:34:26,001 --> 01:34:32,561
drivechains. There's a lot of ways to do it. Yeah, it's just the one thing that is annoying

1015
01:34:32,561 --> 01:34:37,521
to me about drivechains, or one of the things that is annoying to me about drivechains,

1016
01:34:37,521 --> 01:34:44,881
is the need to persuade miners to run the software is annoying to me. And I really wish we

1017
01:34:44,881 --> 01:34:50,800
had a better way, or a way to do two-way peg sidechains without needing to convince anyone

1018
01:34:50,800 --> 01:34:56,480
and beg them to please run their software for me. Yeah, and one of the concerns that I have is,

1019
01:35:00,961 --> 01:35:06,321
so there's lots of people who mine Bitcoin. There's lots of people who have an S9,

1020
01:35:06,400 --> 01:35:10,480
and they're in their basement, and they pointed at the pool of their choice.

1021
01:35:11,521 --> 01:35:14,641
But those individual miners are doing their own block construction,

1022
01:35:15,201 --> 01:35:22,561
right? They're outsourcing block construction to the pool operator. And what I hope happens,

1023
01:35:22,561 --> 01:35:26,321
whether it's through Stratum V2 or something else, is that we move to a world where

1024
01:35:26,961 --> 01:35:29,201
individual miners are doing all their own block.

1025
01:35:32,561 --> 01:35:39,360
Only, you know, five mining pools in the world, and they do all the block construction,

1026
01:35:39,360 --> 01:35:43,681
then there's really only five people that the government needs to lean on. If you have,

1027
01:35:44,240 --> 01:35:49,441
you know, pools are just aggregating hash rate, and everybody does their own block construction,

1028
01:35:50,001 --> 01:35:54,961
then it makes it a much more decentralized and much more censorship resistant network.

1029
01:35:54,961 --> 01:36:00,321
And one of the concerns that I have with drivechains, both like the BIP300301 construction,

1030
01:36:00,321 --> 01:36:09,201
but also like the more general idea, is that if miners have to run sidechain software in order

1031
01:36:09,201 --> 01:36:15,280
to like know which peg out to process, or in order to, you know, do other operations that

1032
01:36:15,280 --> 01:36:24,400
are important for the consensus of the sidechain, then that is going to push miners to outsource

1033
01:36:24,400 --> 01:36:30,800
block construction that includes drivechain as test stations to either mining pools or to

1034
01:36:30,800 --> 01:36:40,480
other people, right? Like the dynamic that we've seen happen in Ethereum, where because of MEV,

1035
01:36:41,441 --> 01:36:47,280
block construction is now a very highly specialized activity where like margin is made or lost.

1036
01:36:47,920 --> 01:36:54,561
You have a lot of Ethereum stakers that outsource block construction to MEV boost

1037
01:36:56,001 --> 01:37:00,480
constructors. And I'm worried that we could end up with a similar situation here where,

1038
01:37:01,040 --> 01:37:06,961
you know, okay, right now, all that you need to mine Bitcoin is you plug in an S19,

1039
01:37:06,961 --> 01:37:11,361
put it in your basement, and like you're mining Bitcoin. If in order to mine Bitcoin

1040
01:37:11,361 --> 01:37:18,640
and construct your own blocks, you also need to run like some big block BSV node for the big

1041
01:37:18,640 --> 01:37:24,640
block sidechain. And you need to run some super complicated thing for some other super complicated

1042
01:37:24,640 --> 01:37:31,441
sidechain. And like, you've got to run all this other software in order to like know which withdrawals

1043
01:37:31,441 --> 01:37:35,601
to process. Like people aren't going to do that. So they're just going to outsource block construction

1044
01:37:35,601 --> 01:37:41,120
to either their pool operator or to some other service. And it kind of goes in the opposite

1045
01:37:41,120 --> 01:37:48,081
direction from where I think we want to go with miner decentralization. I'd like to provide what

1046
01:37:48,081 --> 01:37:57,920
I think is the standard drivechain response to that question about the role of the concentration

1047
01:37:58,000 --> 01:38:06,321
in the mining sector that could arise from the existence of merged mining being much bigger.

1048
01:38:07,601 --> 01:38:12,640
So if there are a bunch of protocols, a bunch of sidechains that are merged mine with Bitcoin,

1049
01:38:12,640 --> 01:38:21,040
and they're very large, then, as you say, there could be an incentive financially for the mining

1050
01:38:21,841 --> 01:38:30,961
on Bitcoin to include the burden of having to have a node of those sidechains. So the idea is

1051
01:38:30,961 --> 01:38:41,520
that this would be an extra cost to miners, and it would drive centralization. So the view is that

1052
01:38:41,520 --> 01:38:49,120
the view of this criticism is a view that ordinary home miners wouldn't be able to affordably run

1053
01:38:49,120 --> 01:38:55,601
the node of the Thunder sidechain or the HiveMine sidechain, and therefore they would be

1054
01:38:55,601 --> 01:39:02,400
less profitable potentially than someone who is doing true blind merged mining, where they're

1055
01:39:02,400 --> 01:39:07,601
mining Bitcoin layer one, and therefore they're blind merged mining all of the sidechains,

1056
01:39:07,601 --> 01:39:13,441
but they're not running the nodes. So your view, if I understand it, is that the non-blind

1057
01:39:14,081 --> 01:39:19,361
merged mining nodes will make more money and therefore have more hash rate and more income,

1058
01:39:20,481 --> 01:39:27,120
so this will cause there to be more big miners in Bitcoin, fewer miners, fewer home miners.

1059
01:39:27,120 --> 01:39:35,841
But the response to this, Reindahl, is that it is a view which is an arbitrary prejudice

1060
01:39:35,841 --> 01:39:43,681
against profitable software. There are in Bitcoin already a number of economic forces that are

1061
01:39:44,832 --> 01:40:07,832
driving centralization of Bitcoin mining, and this was understood by Satoshi from the very beginning, when he said that the number of people running a network node would reduce over time, and that it wouldn't be the case that ordinary people would be mining, they would just maybe validate or use, they wouldn't be generating new coins, they wouldn't be running server farms, that was his phrase, server farms.

1062
01:40:07,832 --> 01:40:25,832
The concentration in the Bitcoin mining sector was understood from the get-go as a natural result of capitalism and specialization, and the prejudice against merged mining, which is popular among certain drivechain critics, they have an arbitrary prejudice against profitable software.

1063
01:40:25,832 --> 01:40:30,212
software. They wouldn't put it that way, but I believe that is the correct

1064
01:40:30,212 --> 01:40:35,432
understanding of their view, which is that it constitutes an arbitrary prejudice

1065
01:40:35,432 --> 01:40:37,272
against profitable software.

1066
01:40:37,612 --> 01:40:38,372
Those same

1067
01:40:38,451 --> 01:40:44,451
drivechain critics, I don't think ever would say, that we should try to have Bitcoin

1068
01:40:44,451 --> 01:40:49,631
miners never have a load balancing arrangement with a power company.

1069
01:40:50,251 --> 01:40:51,070
Like if a

1070
01:40:51,070 --> 01:40:57,230
If a large Bitcoin miner with a billion dollars of ASICs has an agreement with a power company

1071
01:40:57,230 --> 01:41:04,030
that's specialized, a specialized agreement an ordinary home miner can't have, then the

1072
01:41:04,030 --> 01:41:07,750
agreement between the power company and the large Bitcoin miner that's co-located

1073
01:41:08,286 --> 01:41:17,486
would be profitable for that Bitcoin miner, enabling it to have a higher rate of profit and hashrate, but we don't bemoan that.

1074
01:41:17,486 --> 01:41:24,832
We don't bemoan that some parties can build like a large Bitcoin miner right next to a dam, and a home miner can't do that.

1075
01:41:25,832 --> 01:41:41,832
There are forces that are natural in capitalism that lead to specialization and economies of scale, and for people to criticize merged mining as a part of that, I think they're singling out merged mining arbitrarily.

1076
01:41:41,832 --> 01:42:03,832
And what merged mining is, is it's profitable activity for miners that takes the form of software. That's the only difference between merged mining and other forms of miner profit, is that merged mining takes the form of software, and therefore criticism of it is arbitrary, and should be recognized as that.

1077
01:42:04,832 --> 01:42:24,832
I don't think that's necessarily true. Block construction is something that, for protocol reasons right now, is handled by mining pools, but I don't think anybody wants that to be the case.

1078
01:42:25,832 --> 01:42:45,832
We've seen what's happened in the Ethereum community, where after Tornado Cash got OFAC'd, a bunch of MEV boost relays all started censoring transactions to Tornado Cash, among other addresses, and I don't think anybody thinks that that's a good thing.

1079
01:42:46,832 --> 01:43:00,832
I mean, I'm looking on the mining dashboard for mempool.space right now, and five mining pools control, looks like about 80% of the hash rate, and right now those five mining pools are doing all the block construction there.

1080
01:43:01,832 --> 01:43:25,832
I think it's important for the censorship resistance of the network that more people be able to participate in block construction, and the more that you make block construction into a specialized activity that requires specialized hardware or specialized expertise, I think it reduces the number of people that a government has to lean on in order to start centering transactions efficiently.

1081
01:43:26,832 --> 01:43:42,832
So I don't think it's the same as power agreements, because even if miners seek out cheaper power or better cooling, that's still a very permissionless system.

1082
01:43:43,832 --> 01:43:46,832
Anybody can go do that, can go and plug in.

1083
01:43:46,832 --> 01:44:11,832
I think if you can take a trailer full of S19s and go find cheaper power with them somewhere, and have decentralized block building, I think adding unbounded complexity to block building is materially different than criticizing normal capitalist activity and finding power.

1084
01:44:13,832 --> 01:44:34,832
I'll put it this way. When you talk about miner centralization and it going in the wrong direction, are you talking about one miner making more profit and therefore putting another smaller miner out of business, and therefore that is a problem?

1085
01:44:35,832 --> 01:44:45,832
Henry, so really quick, when I say that block construction is centralized in the miners, do you know what I'm saying, or are we talking about two different things?

1086
01:44:48,832 --> 01:44:49,832
I think I know what you're saying.

1087
01:44:52,792 --> 01:44:53,712
you're lab... Yeah, sure.

1088
01:44:54,772 --> 01:45:00,652
So, you know, miners in the abstract do is they have a

1089
01:45:00,652 --> 01:45:04,832
mempool, people broadcast transactions and those transactions go into the mempool,

1090
01:45:05,372 --> 01:45:05,752
right? And like

1091
01:45:08,547 --> 01:45:14,447
And then what miners do is they slice

1092
01:45:14,447 --> 01:45:15,647
off the top.

1093
01:45:15,967 --> 01:45:20,902
The top, know, call it one to four megabytes worth

1094
01:45:21,832 --> 01:45:33,832
And they construct a block out of them, and then they try to find a nonce that with the rest of the block hashes to a hash that's below the difficulty.

1095
01:45:33,832 --> 01:45:41,832
So selecting which transactions go into the block and assembling all of that together is block construction.

1096
01:45:42,832 --> 01:45:53,832
And right now, the way that Bitcoin mining works is if you buy an S19 and you just plug it in, you log into the little interface, and they say, which pool do you want to use?

1097
01:45:53,832 --> 01:46:01,832
And you point it at, I don't know, Luxor or ViaBTC or AntPool or whatever, brains, pick your favorite pool.

1098
01:46:02,832 --> 01:46:11,832
What ends up happening is that you, as the person running the S19, are not doing that transaction selection, you're not doing that block construction.

1099
01:46:12,832 --> 01:46:29,832
What happens is your pool operator, so brains, AntPool, Foundry, F2Pool, whomever, they run a Bitcoin node, and they have a mempool, and they construct the block template, and then they push it down to everybody who's a miner in that pool.

1100
01:46:29,832 --> 01:46:46,832
So Foundry right now is about a third of the total hack rate, and there's a whole bunch of miners who mine for Foundry, but the people who actually select what transactions go into blocks that are mined by that pool are Foundry.

1101
01:46:46,832 --> 01:47:02,832
So Foundry doesn't have individual miners, so what I'm going to say isn't totally accurate, but if you're an individual miner hooked up to Foundry, and you say, hey, you know what, I really want to include a different set of transactions in this block, you can't.

1102
01:47:03,832 --> 01:47:10,832
Foundry hands you a block and says, this is the block that you're going to mine, and you work on it, and you submit shares to the pool, and they pay you out.

1103
01:47:10,832 --> 01:47:16,832
So if you had a mempool.space slash mining, and there's a pie chart for all the pools…

1104
01:47:17,832 --> 01:47:18,832
One of the reasons that…

1105
01:47:19,832 --> 01:47:21,832
Yeah, go ahead.

1106
01:47:22,832 --> 01:47:36,832
To me, the concern that… I'm going to try and restate the concern you've brought up in my own words, and then you can tell me if it's accurate, because I have a response for it if it is.

1107
01:47:37,832 --> 01:47:55,832
If we activate drivechains right now in a situation where mining is… block construction is done by pools, then those pools are also going to take on the role of constructing blocks for the sidechain and devalidating those blocks.

1108
01:47:56,832 --> 01:48:08,832
And this exacerbates the situation where there's a small number of people who governments have to put pressure on in order to make them bend the knee to censorship regulations.

1109
01:48:09,832 --> 01:48:12,832
So that's how I would rephrase the concern you've brought up.

1110
01:48:12,832 --> 01:48:22,832
And if that's accurate, then it's not a concern for me, because of my experience with people who mine.

1111
01:48:23,832 --> 01:48:32,832
It seems to me that the people who mine care a lot, at least in my experience, about what pool they're running and what their policies are and what they're doing.

1112
01:48:32,832 --> 01:48:35,832
They go to meetups and they talk about it.

1113
01:48:36,832 --> 01:48:41,832
They make little charts and spreadsheets of what the profitability of each mining pool is.

1114
01:48:42,832 --> 01:48:47,832
They test them, and they're like, yeah, this is the amount I made while I mined with this mining pool for this amount of time.

1115
01:48:48,832 --> 01:48:57,832
And then in the next column of the spreadsheet, they have a different attempt to a different mining pool that they mined with and how long and what profit they made from it.

1116
01:48:57,832 --> 01:49:01,832
And actually, they really test these things, and they talk about the policies of various mining pools.

1117
01:49:02,832 --> 01:49:12,832
Like when Marathon came out with a censorship policy or a no-fat compliance policy, miners I talked to were like, yeah, I switched away from that pool because I don't like their new censorship policy.

1118
01:49:13,832 --> 01:49:14,832
They talk about this stuff.

1119
01:49:15,832 --> 01:49:24,832
And they recommend trying a different one, and they propose different things that they've done and how they made profit out of it.

1120
01:49:24,832 --> 01:49:37,832
So if we reach a situation where mining pools are pressured by governments to start censoring, then I think that'll be a huge topic of discussion among the mining pool meetups.

1121
01:49:38,832 --> 01:49:46,832
And people will say, let's get out of these ones that are being regulated, and we'll move to these other ones that have popped up in unregulated jurisdictions.

1122
01:49:47,832 --> 01:49:53,832
And here's my assessment of how much more profit we can make because they're paying out the fees that you get from the censored transactions.

1123
01:49:54,832 --> 01:49:55,832
And such.

1124
01:49:56,832 --> 01:50:05,832
They'll pay attention, and they'll say, I want to move to this one because it's mining these sidechains that are very profitable for me, and I want to move to these other ones.

1125
01:50:06,832 --> 01:50:17,832
They seem to be very into it, and I don't think it's a concern that they'll just blindly stay with pools that are censoring when that's a cost to them, and they can do better by moving to other pools that aren't.

1126
01:50:17,832 --> 01:50:32,832
Yeah, I guess what that ends up depending on is that there's operators that are able to pop up in other jurisdictions that can run the right combination of sidechain nodes to maximize profitability.

1127
01:50:33,832 --> 01:50:35,832
So I think it's a reasonable response.

1128
01:50:36,832 --> 01:50:40,832
What do you think of the miners profit in many different ways?

1129
01:50:41,832 --> 01:50:44,832
And they're all trying to be as profitable as possible.

1130
01:50:45,832 --> 01:50:53,832
And if any of them do something that makes more profit, then that will tend to force the others to do the same or quit operating in the long run.

1131
01:50:54,832 --> 01:50:59,832
And one of the ways miners can profit, one of the thousand ways miners can profit, is by running profitable software.

1132
01:51:00,832 --> 01:51:01,832
And therefore, there should be...

1133
01:51:02,832 --> 01:51:05,832
I assume you're asking me and Ryan Dale or anyone else?

1134
01:51:06,832 --> 01:51:18,832
I was asking Ryan Dale, because he was voicing what I understood, if I understand it correctly, to be the criticism that merged mining, which already exists on Bitcoin, would be greater in terms of profitability.

1135
01:51:18,832 --> 01:51:23,832
The criticism that merged mining, which already exists on Bitcoin, would be greater if drivechain is adopted.

1136
01:51:24,832 --> 01:51:30,832
And therefore, that wouldn't be good because merged mining is bad because it increases centralization in mining.

1137
01:51:31,832 --> 01:51:37,832
But I'm wondering, there are 1,001 things that miners do that can increase centralization in mining.

1138
01:51:38,832 --> 01:51:41,832
All of the ways they profit are those 1,001 things.

1139
01:51:42,832 --> 01:51:44,832
And the bigger miners have all kinds of advantages.

1140
01:51:44,832 --> 01:51:47,832
Running profitable software is just one of them.

1141
01:51:48,832 --> 01:51:53,832
So the criticism of merged mining is that it's not good because it increases centralization.

1142
01:51:54,832 --> 01:51:59,832
But that's an arbitrary prejudice against software, against profitable software.

1143
01:52:00,832 --> 01:52:04,832
The same criticism isn't made against non-software based productivity.

1144
01:52:05,832 --> 01:52:15,832
But you're not advocating for a soft fork to Bitcoin to increase the profitability of other arbitrage opportunities that miners have.

1145
01:52:16,832 --> 01:52:20,832
You're advocating for this specific proposal.

1146
01:52:21,832 --> 01:52:29,832
So this specific proposal opens the door for more specialized block construction.

1147
01:52:29,832 --> 01:52:36,832
And I think SupertestNet just had a great response about miners are ultimately profit seeking.

1148
01:52:37,832 --> 01:52:46,832
So if it's more profitable to mine with a pool in a different jurisdiction, they'll try to do that unless they have some compliance burden that they're dealing with.

1149
01:52:47,832 --> 01:52:48,832
That's a totally reasonable response.

1150
01:52:49,832 --> 01:52:57,832
I think nobody's proposing a soft fork to make it easier for miners to go get power sharing agreements at hydrodams.

1151
01:52:58,832 --> 01:53:05,832
The soft fork that you're advocating for makes block building a more specialized activity.

1152
01:53:06,832 --> 01:53:15,832
And I think I'm saying that we've seen in other ecosystems that as block building becomes more specialized, it also becomes more centralized.

1153
01:53:16,832 --> 01:53:21,832
We've seen this play out over the last two months in Ethereum after they moved to proof of stake.

1154
01:53:22,832 --> 01:53:39,832
And so I think the question that the ecosystem has to ask itself is if we really want trustless peg outs, which I think we do, then are drivechains the best answer for that?

1155
01:53:40,832 --> 01:53:46,832
And I think one of the components for evaluating bestness is what does it do to mining incentives?

1156
01:53:46,832 --> 01:53:52,832
And I think there's a clear incentive push here towards more centralization.

1157
01:53:53,832 --> 01:53:58,832
And maybe the expressibility and feature set that we get from drivechains is totally worth it.

1158
01:53:59,832 --> 01:54:03,832
And we take the hit on more miner centralization.

1159
01:54:04,832 --> 01:54:14,832
But I think it's a fair claim that drivechains increases miner centralization.

1160
01:54:14,832 --> 01:54:17,832
I think you could argue about how much and what the effect of it would be.

1161
01:54:18,832 --> 01:54:19,832
But I think that's definitely a tradeoff.

1162
01:54:20,832 --> 01:54:25,832
And I think that's a tradeoff that I'd love to see a little bit more exploration of.

1163
01:54:26,832 --> 01:54:32,832
I'd also like to point out that I'm not sure that drivechains are the best way to do a two-way peg.

1164
01:54:33,832 --> 01:54:37,832
I haven't looked as much into rollups as someone like John Light has.

1165
01:54:38,832 --> 01:54:42,832
I do suspect they're probably a better way to do a two-way peg.

1166
01:54:42,832 --> 01:54:45,832
But one thing I do know is that drivechains are very close.

1167
01:54:46,832 --> 01:54:47,832
They're very easy to get from where we are.

1168
01:54:48,832 --> 01:54:52,832
In fact, I think we probably will get them as soon as Bitcoin 18 gets in.

1169
01:54:53,832 --> 01:54:56,832
And the nice thing about drivechains is even if they're not the best way to do it,

1170
01:54:57,832 --> 01:54:58,832
they give you access to the best way to do it.

1171
01:54:59,832 --> 01:55:04,832
Just make a sidechain that has rollups or an op code and now you've got them.

1172
01:55:05,832 --> 01:55:10,832
So yeah, part of the reason why I think drivechains are great is because they're really easy to get into Bitcoin.

1173
01:55:10,832 --> 01:55:13,832
And they're probably going to happen pretty soon.

1174
01:55:14,832 --> 01:55:23,832
The problem with rollups though, SuperTestNet, is that they really can't be made to be decentralized.

1175
01:55:24,832 --> 01:55:26,832
At least in the kind of architectures we've seen.

1176
01:55:27,832 --> 01:55:40,832
Just because the whole small block argument to begin with is there's a direct unbreakable trade-off space between the data throughput,

1177
01:55:41,832 --> 01:55:46,832
or just the data requirements for validating how many transactions per second or whatever you can have,

1178
01:55:47,832 --> 01:55:51,832
and how many people can actually run the nodes and verify stuff.

1179
01:55:52,832 --> 01:56:00,832
And the rollup structure is basically just a much, much faster data intensive blockchain

1180
01:56:01,832 --> 01:56:06,832
that proves down to a small footprint on the main chain that lots of people can have.

1181
01:56:07,832 --> 01:56:16,832
But the rollup itself has dramatically reduced kind of trade-off requirements

1182
01:56:16,832 --> 01:56:24,832
compared to things, more interactive protocols like lightning or more generic kind of state channel constructions

1183
01:56:25,832 --> 01:56:31,832
where the data availability is kind of on the onus of the people engaging in whatever the thing they're doing is.

1184
01:56:34,832 --> 01:56:37,832
Reindahl, you said that drivechain would open the door.

1185
01:56:38,832 --> 01:56:44,832
And I appreciated how careful you were with your wording regarding the risks of greater merged mining

1186
01:56:44,832 --> 01:56:47,832
leading to more concentration in the mining sector.

1187
01:56:48,832 --> 01:56:52,832
Would you agree that merged mining has been around since the very beginning,

1188
01:56:53,832 --> 01:56:58,832
and that in theory we could have very large merged mine sidechains on Bitcoin today?

1189
01:56:59,832 --> 01:57:05,832
The only reason for that has been that communities haven't chosen to adopt and use them at a large rate.

1190
01:57:06,832 --> 01:57:17,832
But it already could occur and that it is potentially a powerful solution to the need for higher fees in the future.

1191
01:57:18,832 --> 01:57:20,832
And so I appreciate how you talked about there being trade-offs.

1192
01:57:21,832 --> 01:57:29,832
Are you sympathetic to the notion that merged mining would be vastly better than inflation in the future if that were the choice?

1193
01:57:30,832 --> 01:57:36,832
So I think that more usage would be better than inflation.

1194
01:57:37,832 --> 01:57:42,832
It's not obvious to me that the only way to get more usage is through merged mining.

1195
01:57:43,832 --> 01:57:49,832
We could end up in a situation where somehow lightning really takes off

1196
01:57:50,832 --> 01:57:54,832
and just lightning channel opening closes and stuff.

1197
01:57:55,832 --> 01:57:56,832
Yeah, we just have to fix it first.

1198
01:57:56,832 --> 01:57:57,832
Yeah, exactly.

1199
01:57:58,832 --> 01:58:05,832
But it could be some other L2 that we use and then all the liquidity management for that drives enough usage to solve fee problems.

1200
01:58:06,832 --> 01:58:12,832
Going back to what SupertestNet was saying a few minutes ago,

1201
01:58:13,832 --> 01:58:19,832
I think the thing that all of us really want is we want a trustless peg out from sidechains.

1202
01:58:20,832 --> 01:58:28,832
It's just not clear to me that drivechains are the optimal set of trade-offs to get us there.

1203
01:58:29,832 --> 01:58:33,832
And I think whether it's drivechains or something else,

1204
01:58:34,832 --> 01:58:41,832
the long-term health of Bitcoin is going to be contingent on it actually getting usage and people actually using it.

1205
01:58:42,832 --> 01:58:48,832
Buying Bitcoin in a custodial exchange and then trading around in custodial exchanges

1206
01:58:49,832 --> 01:58:55,832
and never having transactions hit the chain, in my view, is not using Bitcoin.

1207
01:58:56,832 --> 01:58:58,832
I know that there's a meme that saving in Bitcoin is using Bitcoin.

1208
01:58:59,832 --> 01:59:09,832
I think that that's a coping strategy that people use to deal with the fact that Bitcoin really isn't being used as much as people want them to.

1209
01:59:10,832 --> 01:59:18,832
So whether we get more usage through something like drivechains or whether we get more usage from other L2s or other higher layers, who knows?

1210
01:59:19,832 --> 01:59:30,832
But I think if we get to a point where we have to really think about something like changing the issuance schedule for Bitcoin

1211
01:59:31,832 --> 01:59:36,832
because the incentives don't work out and the security budget starts becoming a problem,

1212
01:59:36,832 --> 01:59:41,832
I think at that point it might be time to go do something else.

1213
01:59:50,832 --> 01:59:52,832
But do it on a drivechain.

1214
01:59:53,832 --> 01:59:57,832
There was this cool moment in the history of classical music,

1215
01:59:58,832 --> 02:00:02,832
and this is an analogy to drivechain versus rollups,

1216
02:00:02,832 --> 02:00:10,832
that in classical music, a couple decades ago, Glenn Gould wanted to re-record his Goldberg Variations,

1217
02:00:11,832 --> 02:00:16,832
which was his breakout huge hit album from the 50s.

1218
02:00:17,832 --> 02:00:25,832
So 30 years later in the 80s, he wanted to re-record it because Dolby Digital surround sound recording was possible.

1219
02:00:26,832 --> 02:00:33,832
So instead of having it just be in stereo, he wanted to re-do his masterpiece recording using the higher technology.

1220
02:00:34,832 --> 02:00:42,832
But it's very interesting that when he re-recorded the Goldberg Variations, they used both systems.

1221
02:00:43,832 --> 02:00:49,832
They turned on in the recording studio the stereo system and the Dolby Digital recording system.

1222
02:00:49,832 --> 02:00:53,832
And at that time in the 80s, stereo was at its peak.

1223
02:00:54,832 --> 02:00:57,832
Stereo was as good as stereo ever had been.

1224
02:00:58,832 --> 02:01:00,832
It had developed for a long time.

1225
02:01:01,832 --> 02:01:03,832
Dolby Digital was very rudimentary.

1226
02:01:04,832 --> 02:01:08,832
So it was higher technology, but it was newer and therefore not refined.

1227
02:01:09,832 --> 02:01:12,832
And the stereo recording was actually better.

1228
02:01:13,832 --> 02:01:17,832
So they ended up using that because it sounded better.

1229
02:01:17,832 --> 02:01:26,832
So it's possible at this moment in Bitcoin development, roll ups are the high technology and drivechain are the low technology.

1230
02:01:27,832 --> 02:01:34,832
And it actually sometimes makes sense in life to use the low technology when it's been refined.

1231
02:01:35,832 --> 02:01:37,832
Maybe it's more conservative.

1232
02:01:38,832 --> 02:01:39,832
Maybe it's more understood.

1233
02:01:39,832 --> 02:01:46,832
So it's sometimes better to go forward with that than to use the higher technology.

1234
02:01:47,832 --> 02:01:51,832
I mean, in the case of Bitcoin, unlike recording, you can't do both at once.

1235
02:01:52,832 --> 02:01:58,832
I mean, you could, but what I'm saying is if you're recording piano music, you could use two different recording systems.

1236
02:01:59,832 --> 02:02:00,832
And there's really nothing that's stopping you from that.

1237
02:02:01,832 --> 02:02:02,832
There's no reason not to do it.

1238
02:02:03,832 --> 02:02:07,832
But with Bitcoin, when we do something, there's risk because we're changing things.

1239
02:02:07,832 --> 02:02:12,832
So, I mean, if we're considering two different changes, if we change, there could be risks.

1240
02:02:13,832 --> 02:02:14,832
So you don't want to do both at once necessarily.

1241
02:02:15,832 --> 02:02:16,832
Probably choose one.

1242
02:02:17,832 --> 02:02:25,832
So in this case, there's a bit of an analogy there where it turned out that Glenn Gould, you know, they all liked the stereo recording, even though it wasn't the newer technology.

1243
02:02:26,832 --> 02:02:28,832
It wasn't even the inspiration for him to do the recording.

1244
02:02:29,832 --> 02:02:39,832
So I think there might if we find the drivechain is adopted in the next one or two years, I think we'll look back and say that it was, you know, seven years in to consideration.

1245
02:02:40,832 --> 02:02:48,832
And therefore it was it felt more comfortable for the community, even though we're at the beginning of a growing trend of people talking about like roll ups.

1246
02:02:49,832 --> 02:02:50,832
But they're extremely sophisticated.

1247
02:02:51,832 --> 02:02:54,832
It uses like advanced mathematics and they're not time tested.

1248
02:02:55,832 --> 02:02:59,832
There is not like people have been talking about it for seven years, as far as I understand.

1249
02:03:00,832 --> 02:03:07,832
So there is that there is that moment in the history of science sometimes where there's like multiple options and sometimes the lower technology is good.

1250
02:03:08,832 --> 02:03:14,832
And as we've discussed in this case, like roll ups on a drivechain could actually bring roll ups to Bitcoin layer one faster, maybe.

1251
02:03:24,832 --> 02:03:27,832
I recommend listening to the two different versions of Glenn Gould's recording.

1252
02:03:27,832 --> 02:03:29,832
It's really cool. Like there he plays them.

1253
02:03:29,832 --> 02:03:35,832
He plays the music, the Goldberg variations, two different ways in those two recordings.

1254
02:03:36,832 --> 02:03:37,832
Thank you. I'm a big fan of classical music.

1255
02:03:37,832 --> 02:03:39,832
I think I think I will do that.

1256
02:03:42,832 --> 02:03:47,832
Well, we've been going for two hours, but I hesitate to end the space.

1257
02:03:47,832 --> 02:03:52,832
If anyone has any final thoughts and thanks a lot for our speakers.

1258
02:03:53,832 --> 02:03:55,832
I hope you all come back and speak more any time you want.

1259
02:03:56,832 --> 02:04:00,832
It was really great to hear the high level of discourse between Reindahl and Supertech.

1260
02:04:03,832 --> 02:04:06,832
I guess we'll close the space out and we'll reconvene Thursday.

1261
02:04:07,832 --> 02:04:09,832
So this has been Drivechain Twitter Spaces.

1262
02:04:10,832 --> 02:04:11,832
We talk every Monday and Thursday.

1263
02:04:12,832 --> 02:04:13,832
I'm Henry at LayerTwo Labs.

1264
02:04:14,832 --> 02:04:20,832
We are trying to promote understanding, education and support for Drivechain, which is Bitcoin proposal.

1265
02:04:20,832 --> 02:04:26,832
Bitcoin Improvement Proposal 300 and 301, an idea that has been talked about since 2015.

1266
02:04:27,832 --> 02:04:49,832
It's an idea that has potential, many believe, to increase Bitcoin's value, increase Bitcoin miner revenue, increase Bitcoin extensibility, strengthen Bitcoin's narratives for serving as a platform for a multitude of interesting applications and having more experimentation and innovation on top of Bitcoin, which makes Bitcoin more exciting.

1267
02:04:50,832 --> 02:05:04,832
And potentially more valuable, literally, in terms of the purchasing power of your Bitcoin going up because of the existence of peer-to-peer, two-way pegged, merged mind sidechains.

1268
02:05:05,832 --> 02:05:09,832
It's a cool idea and you can learn more about it at drivechain.info.

1269
02:05:10,832 --> 02:05:17,832
There's also a bunch of other websites that have essays on Drivechain from various Drivechain fans like Fiatjaf and others.

1270
02:05:20,832 --> 02:05:21,832
And there's also videos on YouTube.

1271
02:05:22,832 --> 02:05:23,832
So there's all kinds of places you can find out more.

1272
02:05:24,832 --> 02:05:32,832
You can also join the Drivechain Telegram group, which has over 700 Bitcoiners in it, talking about Drivechain and sharing ideas.

1273
02:05:33,832 --> 02:05:34,832
So I'll see you all on Thursday.

1274
02:05:35,832 --> 02:05:36,832
Thanks so much for being here.