1
00:00:00,000 --> 00:00:06,000
Over time, I've just become more skeptical of it, and this talk is just a recap of
things that I've just like said on Twitter and things,

2
00:00:06,000 --> 00:00:10,200
but I've tried to organize it in a little way, and I'm going to try to shoot through
it in 10 minutes,

3
00:00:10,200 --> 00:00:16,300
so we have as much time as possible and make myself very vulnerable to getting a
question from someone out there.

4
00:00:16,300 --> 00:00:21,100
So I just think this is a bad idea, and it's a big waste of time.

5
00:00:21,100 --> 00:00:24,900
This is it in a nutshell. So the channel's idea is not workable.

6
00:00:24,900 --> 00:00:31,000
There's not enough block space for 1% of the Earth's population to really use
Bitcoin via Lightning.

7
00:00:31,000 --> 00:00:36,500
The channels themselves are difficult to operate and maintain. They have a poor UX.
They're unreliable.

8
00:00:36,500 --> 00:00:43,200
It matters who you open a channel with, so that steers us away from the cypherpunk
world where everything is just like math,

9
00:00:43,200 --> 00:00:47,800
and it steers us back towards this world of brands, and you have trust and
reputation.

10
00:00:47,800 --> 00:00:54,700
The cost-benefit ratio of the channels, it doesn't meet the standard of
acceptability.

11
00:00:54,700 --> 00:01:00,000
Point two is demonstrations of Lightning working are basically fundamentally rooted
in a misunderstanding,

12
00:01:00,000 --> 00:01:05,100
so a lot of the testimony comes from laypeople who are easily duped, and they don't
realize what they're seeing,

13
00:01:05,100 --> 00:01:09,600
and their testimony is worthless. The payment networks have big network effects,

14
00:01:09,600 --> 00:01:14,400
and so the winning payment network will be used by a lot of people,

15
00:01:14,400 --> 00:01:18,200
and if it's not used by a lot of people, then it's just not going to be used by
anyone, I think.

16
00:01:18,200 --> 00:01:22,600
A lot of the Lightning insiders have already been abandoning it over the last few
years.

17
00:01:22,600 --> 00:01:27,800
I'm going to have some quotes about that. The hype is very social,

18
00:01:27,800 --> 00:01:35,300
so the Lightning idea was born out of the block size war, and it is inherently
propaganda, which is nothing against it.

19
00:01:35,300 --> 00:01:39,800
I mean, George Orwell wrote this essay about all art being propaganda, but that's
not the point.

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00:01:39,800 --> 00:01:44,100
What I'm trying to say is that it will never be free of this baggage that it has,

21
00:01:44,100 --> 00:01:50,400
and all these political associations and these loyalty associations.

22
00:01:50,400 --> 00:01:54,200
I mean, I'm just going to keep going to try to get through this super fast.

23
00:01:54,200 --> 00:01:58,500
This is important, though. I'm going to spend time on this slide, and then I'll
probably try to just shoot to the last,

24
00:01:58,500 --> 00:02:04,600
but I'm just letting you know, this is what I experienced personally, so this is why
I've come to hate this idea.

25
00:02:04,600 --> 00:02:08,500
I'm just going to read all this, though. It's important, so I'm sorry about this
long slide.

26
00:02:08,500 --> 00:02:12,400
In May 2015, we got Tadge's here. I love Tadge. He's great.

27
00:02:12,400 --> 00:02:15,700
I don't blame Tadge for this, and neither should you.

28
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This isn't his fault. This is everyone's crazy case.

29
00:02:18,600 --> 00:02:19,700
Is Tadge in the room?

30
00:02:19,700 --> 00:02:20,300
He's right there.

31
00:02:20,300 --> 00:02:21,300
Okay, good.

32
00:02:21,300 --> 00:02:27,500
He's directly in front of me. He's making this as awkward as possible for me.

33
00:02:27,500 --> 00:02:29,600
But I saw their talk on YouTube.

34
00:02:29,600 --> 00:02:33,400
But here's the thing, Tadge, is that I noticed that throughout the year 2015,

35
00:02:33,400 --> 00:02:39,100
the year of the block size war, and the year of people on Reddit, r slash BTC,
hating each other,

36
00:02:39,100 --> 00:02:43,500
I noticed that this video never had more than 350 views in that year.

37
00:02:43,500 --> 00:02:47,700
So this led me to think, the people who argue about Lightning, they actually haven't
watched the video,

38
00:02:47,700 --> 00:02:49,700
and they probably don't really know anything about Lightning.

39
00:02:49,700 --> 00:02:57,000
Maybe they all read the 80-page PDF instead of watching the YouTube video, but
probably not.

40
00:02:57,000 --> 00:03:00,800
Okay, December 2015, Scalene 2 in Hong Kong.

41
00:03:00,800 --> 00:03:03,300
Everyone was like, Lightning is the best.

42
00:03:03,300 --> 00:03:04,900
Soft forks are the best. Scalene layers.

43
00:03:04,900 --> 00:03:10,800
All that is true, and I agreed with it at the time, and I was very excited about
this 2016.

44
00:03:10,900 --> 00:03:19,000
I released, I posted a technical variant that works with this peer-to-peer oracle I
had designed.

45
00:03:19,000 --> 00:03:23,400
And so I had researched it enough to know how it worked in 2016.

46
00:03:23,400 --> 00:03:27,700
And so it's not like I'm unfamiliar with it completely, even though maybe my
knowledge is a little old.

47
00:03:27,700 --> 00:03:29,500
But then this is where the problem started.

48
00:03:29,500 --> 00:03:35,600
It was in February 2019, I was at a Bitcoin meetup in Mexico, and there was a huge
group of people.

49
00:03:35,600 --> 00:03:38,500
Everyone was thrilled with Blue Wallet.

50
00:03:38,500 --> 00:03:42,400
Like every single person, there are hundreds of people, and there's big groups of
people,

51
00:03:42,400 --> 00:03:44,200
and they're like, oh, Blue Wallet is the best thing.

52
00:03:44,200 --> 00:03:49,500
And I downloaded it from the App Store, even though I would normally never do this
peer-pressure download on a phone.

53
00:03:49,500 --> 00:03:51,400
But I was like, I just couldn't resist.

54
00:03:51,400 --> 00:03:54,400
And then a person next to me sent me eight Satoshis.

55
00:03:54,400 --> 00:03:56,500
And I was kind of like, huh, that doesn't really make any sense,

56
00:03:56,500 --> 00:03:59,200
because like I didn't open a channel or like what's going on.

57
00:03:59,200 --> 00:04:01,800
So then I asked the room, like, is it custodial?

58
00:04:01,800 --> 00:04:04,700
And this, I was with like a huge group, this is 25 people,

59
00:04:04,700 --> 00:04:08,100
this is only a small subset of this group of Lightning enthusiasts.

60
00:04:08,100 --> 00:04:10,800
But they had no idea what the question even meant.

61
00:04:10,800 --> 00:04:13,800
Like they didn't even know what custodial, like what the word meant.

62
00:04:13,800 --> 00:04:17,100
And this led me to believe that many of the Lightning supporters are dupes,

63
00:04:17,100 --> 00:04:20,800
so they don't realize what they're saying when they say that Lightning is great.

64
00:04:20,800 --> 00:04:25,400
So then I posted this thing on the mailing list in February 2022.

65
00:04:25,400 --> 00:04:30,400
And then it led me to write this article in April 2022 called Lightning Network
Fundamental Limitations.

66
00:04:30,400 --> 00:04:35,600
It had all these points, and it did go at the large Miami BitDevs that was next to
the conference.

67
00:04:35,600 --> 00:04:38,300
It did get like brought up and discussed.

68
00:04:38,300 --> 00:04:43,300
But at no point did anyone drop like a huge article that went like point by point

69
00:04:43,300 --> 00:04:45,700
and said this is why all this is wrong or doesn't matter.

70
00:04:45,700 --> 00:04:48,400
Everyone just kind of like quietly accepted it.

71
00:04:48,400 --> 00:04:52,600
And so this led me to believe that even though experts in the mailing list crowd,

72
00:04:52,600 --> 00:04:56,500
they can't show us how Lightning Network would work at scale.

73
00:04:56,500 --> 00:05:00,200
And I did fundraising for the company LayerTwo Labs, my own company.

74
00:05:00,200 --> 00:05:04,200
I had one slide out of like 60 slides about how Lightning like doesn't work

75
00:05:04,200 --> 00:05:06,700
and we deserve better and we could easily do better.

76
00:05:06,700 --> 00:05:09,700
And people had like a very strong emotional reaction to this slide.

77
00:05:09,700 --> 00:05:12,600
And a lot of people advised me to just take the slide out.

78
00:05:12,600 --> 00:05:15,500
And this led me to believe that a lot of people are getting funding

79
00:05:15,500 --> 00:05:22,100
based on how much they just conform to the Lightning ideology, for lack of a better
word.

80
00:05:22,100 --> 00:05:27,500
And then really it started to get going when Barack, who's supposedly a genius,

81
00:05:27,500 --> 00:05:31,200
I think he probably is a genius, but all these people are saying Barack is the
smartest person,

82
00:05:31,200 --> 00:05:34,600
maybe even smarter than you. Two people, two different people told me that.

83
00:05:34,600 --> 00:05:36,700
And he's like this genius at Blockstream.

84
00:05:36,700 --> 00:05:41,700
He crashed the Lightning Network like twice for fun, recreationally.

85
00:05:41,700 --> 00:05:45,900
Then when he invented ARK, he didn't say like, oh, this is like a trivial
modification to fix lightning.

86
00:05:45,900 --> 00:05:49,400
His quote was, I've always been a big critic of lightning.

87
00:05:49,400 --> 00:05:54,500
I had severe objections, right, from inbound liquidity to inbound receiving
interactivity.

88
00:05:54,500 --> 00:05:57,800
I wanted with ARK to address the inbound liquidity problem,

89
00:05:57,800 --> 00:06:01,400
but I really couldn't find a cure for it. I failed to see lightning scaling.

90
00:06:01,400 --> 00:06:06,000
So I was like, OK, well, this is like the smartest lightning guy saying that it's
not going to work

91
00:06:06,000 --> 00:06:09,800
and that his own idea is a significant departure from it.

92
00:06:09,800 --> 00:06:14,300
And in April 2023, I presented at MIT about an unrelated thing,

93
00:06:14,300 --> 00:06:18,700
but I saw someone else's, this is a very senior person, lightning person's talk.

94
00:06:18,700 --> 00:06:22,900
They talked to me in the hallway afterwards and they said they have all these
problems with lightning themselves,

95
00:06:23,000 --> 00:06:29,000
but they feel uncomfortable bringing it up and they have been disinvited from
speaking about lightning

96
00:06:29,000 --> 00:06:32,500
based on the tone, like if they don't have like an optimistic tone on lightning,
they don't.

97
00:06:32,500 --> 00:06:39,000
This is an extremely, extremely senior lightning person, like is at the top.

98
00:06:39,000 --> 00:06:41,800
And then in March 2024, I collected all these quotes.

99
00:06:41,800 --> 00:06:45,200
They published Ellen Blackbill. And again, I don't really get like a huge response.

100
00:06:45,200 --> 00:06:48,800
So this is like how this is kind of like what is leading me to where I am now.

101
00:06:48,800 --> 00:06:50,600
I'm kind of just like this is ideas.

102
00:06:50,600 --> 00:06:55,500
But I'm going to try to get into a little bit of the little bit of the details.

103
00:06:55,500 --> 00:06:58,000
Okay, good. We're only like four minutes in.

104
00:06:58,000 --> 00:07:00,700
What is the lightning idea?

105
00:07:00,700 --> 00:07:05,400
It is this idea that you have these bi-directional channels, two people equals one
channel.

106
00:07:05,400 --> 00:07:12,500
And instead of Alice paying Bob, Alice can find like a route through this like six
degrees of Kevin Bacon concept

107
00:07:12,500 --> 00:07:16,000
that probably you know someone who knows someone who knows the person.

108
00:07:16,000 --> 00:07:21,300
And instead of because the payer wants to pay because they want to buy something

109
00:07:21,300 --> 00:07:23,300
and the receiver wants more money.

110
00:07:23,300 --> 00:07:25,900
So those parts are fine. But how do you get it?

111
00:07:25,900 --> 00:07:28,900
How do you use these channels that belong to these other people

112
00:07:28,900 --> 00:07:31,400
and you make use of the HTLC or something similar?

113
00:07:31,400 --> 00:07:34,300
So that that is to my in my opinion.

114
00:07:34,300 --> 00:07:38,100
This is like what the lightning network idea is.

115
00:07:38,100 --> 00:07:42,500
And the problem is that the channel idea and the HTLC idea are they're very,

116
00:07:42,500 --> 00:07:47,700
very good ideas at the time. They represent brilliant research in 2015.

117
00:07:47,700 --> 00:07:51,500
And I was very excited about them. But in practice, they don't work.

118
00:07:51,500 --> 00:07:55,800
And I wrote this piece as I tried to explain.

119
00:07:55,800 --> 00:08:01,400
This is the beginning of it. But like the channel part basically says we have very
realistic assumptions

120
00:08:01,400 --> 00:08:05,800
on how you onboard yourself to lightning by opening a channel

121
00:08:05,800 --> 00:08:09,500
and how many channels you probably need in your life and how long will they last.

122
00:08:09,500 --> 00:08:14,600
If you have these realistic assumptions, even these assumptions are pretty
optimistic that I took.

123
00:08:14,600 --> 00:08:19,100
It takes like 121 years to onboard eight billion people, which is too long.

124
00:08:19,100 --> 00:08:21,800
And if the channels only last a year, of course,

125
00:08:21,800 --> 00:08:26,200
some people have a channel that's lasted a very long time, like more than two years.

126
00:08:26,200 --> 00:08:30,400
But every time you need a channel, you like you have to go back to the drawing board

127
00:08:30,400 --> 00:08:33,200
and reopen, reconsumed L1 block space again.

128
00:08:33,200 --> 00:08:36,500
So if every channel only lasts one year,

129
00:08:36,500 --> 00:08:40,400
you have to roll the whole thing over and only like 0.82% of the Earth's population

130
00:08:40,400 --> 00:08:43,400
can actually use Bitcoin via the lightning network.

131
00:08:43,400 --> 00:08:46,700
And then I had like a part about do the channel factories help?

132
00:08:46,700 --> 00:08:49,000
It turns out they don't because they're extremely fragile.

133
00:08:49,000 --> 00:08:55,000
One saboteur can crash the whole thing and force you to go back to L1.

134
00:08:55,000 --> 00:09:00,100
The HTLC idea also doesn't quite work because it expands the size of,

135
00:09:00,100 --> 00:09:03,000
it depends on how you count it, but basically two transactions you need

136
00:09:03,000 --> 00:09:06,600
in order to actually have the money and buy something with it.

137
00:09:06,600 --> 00:09:09,900
They increase the number of bytes that you must use.

138
00:09:09,900 --> 00:09:14,400
And this is a catch-22 because when the fee rate on the L1 blockchain is very high,

139
00:09:14,400 --> 00:09:18,200
the HTLC is so expensive that it's better off if you just don't use it at all.

140
00:09:18,200 --> 00:09:21,100
And the lightning network part is useless.

141
00:09:21,100 --> 00:09:25,200
And then when the fee rates are low, you don't need to bother with the lightning
network

142
00:09:25,200 --> 00:09:29,100
because the fee rates are low. So it's a catch-22.

143
00:09:29,100 --> 00:09:32,200
And then as I mentioned, I published this other article

144
00:09:32,200 --> 00:09:34,200
unrelated to the lightning limitations article.

145
00:09:34,200 --> 00:09:36,900
I just collected all these quotes from people.

146
00:09:36,900 --> 00:09:40,800
First one is from Taz. He did a great interview on what Bitcoin did.

147
00:09:40,800 --> 00:09:44,000
And even at one point the guy, Peter McCormick, is like,

148
00:09:44,000 --> 00:09:47,600
wow, this interview is really not like the normal lightning interview

149
00:09:47,600 --> 00:09:50,700
of like everything's perfect. This is like a really sober interview.

150
00:09:50,700 --> 00:09:55,100
And he tried to right the ship six years ago.

151
00:09:55,800 --> 00:10:00,600
But we're still here doing this for some reason.

152
00:10:00,600 --> 00:10:02,900
So yeah, it's like lots of quotes.

153
00:10:02,900 --> 00:10:05,200
And then I noticed other people have made similar lists.

154
00:10:05,200 --> 00:10:07,600
I found this list. This is someone else, David Shares.

155
00:10:07,600 --> 00:10:09,900
I don't know who this is. I think it's a Bitcoin cash person.

156
00:10:09,900 --> 00:10:13,500
But the point is he has this list on GitHub.

157
00:10:13,500 --> 00:10:17,500
And it's just like link after link after link after link.

158
00:10:17,500 --> 00:10:20,600
And there's this—it only has 122 subscribers,

159
00:10:20,600 --> 00:10:24,200
but there's a Telegram group that's called Lightning's Best Moments.

160
00:10:24,300 --> 00:10:26,400
And I just picked out like a couple random days.

161
00:10:26,400 --> 00:10:28,300
This is like January 27, January 28.

162
00:10:28,300 --> 00:10:31,500
This is not like me cherry-picking. I just literally scroll to random times.

163
00:10:31,500 --> 00:10:36,300
But it's like discussion of a bug that can be exploited to lock up funds.

164
00:10:36,300 --> 00:10:38,500
Stuff nobody seems to know about lightning.

165
00:10:38,500 --> 00:10:42,500
I'm working on some new code. The L&D nodes are stuck payments like this.

166
00:10:42,500 --> 00:10:45,000
Obviously, everything has been rebooted and upgraded.

167
00:10:45,000 --> 00:10:46,800
You know, money is trapped.

168
00:10:46,800 --> 00:10:48,600
Albi appears to be geoblocking Israel.

169
00:10:48,600 --> 00:10:51,200
This is something of the functioning self-sovereign

170
00:10:51,200 --> 00:10:53,500
that makes my funds hard to access.

171
00:10:53,500 --> 00:10:58,100
Someone is using HTLC expired over 3,000 blocks ago to like whatever.

172
00:10:58,100 --> 00:10:59,900
So like these are all just like funny little things.

173
00:10:59,900 --> 00:11:02,500
If you're running L&D older than 18.5,

174
00:11:02,500 --> 00:11:04,100
stop what you're doing and upgrade immediately.

175
00:11:04,100 --> 00:11:05,900
Thieves are draining funds using exploit.

176
00:11:05,900 --> 00:11:07,200
So it's just like, you know,

177
00:11:07,200 --> 00:11:12,300
it's just like a huge bulletin board of just like kind of funny things.

178
00:11:12,300 --> 00:11:17,200
And you know, none of these problems exist with other L2s.

179
00:11:17,200 --> 00:11:18,900
Yeah, this is—I wrote this tweet.

180
00:11:18,900 --> 00:11:22,800
This is a reaction to the Fiat jobs creator of Nostr.

181
00:11:22,800 --> 00:11:27,300
And he's—this is him in 2023, two years ago.

182
00:11:27,300 --> 00:11:28,200
Lightning is a scam.

183
00:11:28,200 --> 00:11:31,000
It is scamming Bitcoiners out of their time and energy and money for six years.

184
00:11:31,000 --> 00:11:32,600
I'm not saying that because he said it's automatic.

185
00:11:32,600 --> 00:11:36,000
I'm just saying this is back—this is the timeline

186
00:11:36,000 --> 00:11:39,700
of when I wrote this tweet about problems with LN onboarding.

187
00:11:39,700 --> 00:11:42,400
There's channel risk. It matters who you open the channel with.

188
00:11:42,400 --> 00:11:46,400
Liquidity. The HTLCs don't work. The routing is difficult.

189
00:11:46,400 --> 00:11:49,800
Custodial Lightning. I'll get to that.

190
00:11:49,800 --> 00:11:52,400
So again, like I don't know like but maybe this is the day.

191
00:11:52,400 --> 00:11:56,800
I don't like, you know, I've never seen like the big like knockdown response to all
this.

192
00:11:56,800 --> 00:11:59,700
So then I just quickly try to get through these other points.

193
00:11:59,700 --> 00:12:00,900
These are not like serious points.

194
00:12:00,900 --> 00:12:05,600
These are just like but, you know, Lightning derangement syndrome.

195
00:12:05,600 --> 00:12:07,500
Lightning doesn't work. And then if you tell the truth about it,

196
00:12:07,500 --> 00:12:10,500
then people get very defensive and then they just become very nasty.

197
00:12:10,500 --> 00:12:13,500
But as a result of this, Lightning gets out of criticism.

198
00:12:13,500 --> 00:12:16,300
A lot of people are just not comfortable saying things

199
00:12:16,300 --> 00:12:18,900
or at least they weren't for many years.

200
00:12:18,900 --> 00:12:20,800
And as a result, we're all lying to ourselves.

201
00:12:20,800 --> 00:12:25,900
Someone at this conference two years ago basically said like that.

202
00:12:25,900 --> 00:12:30,800
Well, I don't want to dox the person so but they basically said that.

203
00:12:30,800 --> 00:12:34,200
Custodial Lightning. This is the stupidest idea in the universe.

204
00:12:34,200 --> 00:12:36,800
Imagine getting it. You get in a driver. There's Waymo.

205
00:12:36,800 --> 00:12:39,100
But there's a human driver in the front seat

206
00:12:39,100 --> 00:12:42,500
and he drives you to your destination like with his hands and like with his eyes.

207
00:12:42,500 --> 00:12:44,700
It's like using the turn signal and everything.

208
00:12:44,700 --> 00:12:48,900
And then as you leave, the guy says Waymo is the future of taxis

209
00:12:48,900 --> 00:12:53,200
because a computer can drive cheaper and safer than any human driver.

210
00:12:53,200 --> 00:12:55,200
You would just think like, I can't, you know,

211
00:12:55,200 --> 00:12:57,000
there's nothing I can even say to this person.

212
00:12:57,000 --> 00:13:00,600
This person is so stupid that I'm not even going to bother like

213
00:13:00,600 --> 00:13:02,700
explaining to them why this doesn't make any sense.

214
00:13:02,700 --> 00:13:05,100
You would just say, oh, yeah, thanks.

215
00:13:05,100 --> 00:13:08,400
You know, see you later. And you would just leave.

216
00:13:08,400 --> 00:13:12,500
The custodial idea means that you involve trust.

217
00:13:12,500 --> 00:13:16,000
It means all the proof of work, blockchain idea, the key,

218
00:13:16,000 --> 00:13:19,100
the user sovereignty over the keys that you roll the randomness.

219
00:13:19,100 --> 00:13:20,700
So all that is just out the window.

220
00:13:20,700 --> 00:13:26,200
So it's kind of like, but a lot of people defend this idea.

221
00:13:26,200 --> 00:13:28,800
The problems with Lightning are not like normal problems

222
00:13:28,800 --> 00:13:33,100
that you'd have with a new idea, which is like we hired the wrong guy,

223
00:13:33,100 --> 00:13:34,100
but he had a bad work ethic.

224
00:13:34,100 --> 00:13:36,200
So we fired him and that set us back four months.

225
00:13:36,200 --> 00:13:39,900
Or the idea is new and our customers aren't used to it yet.

226
00:13:39,900 --> 00:13:44,000
The ideas in Lightning Network are like at the core of the idea.

227
00:13:44,000 --> 00:13:48,000
They're like, hey, everyone, I just noticed it's possible to attack the channel

228
00:13:48,000 --> 00:13:51,400
by doing complicated thing XYZ.

229
00:13:51,400 --> 00:13:56,100
This attack imposes a new cost or risk on the channel owner, aka the user.

230
00:13:56,100 --> 00:13:59,200
And we can fix the problem with like wacky solution, whatever.

231
00:13:59,200 --> 00:14:02,500
But like these flood and loot, liquidity, whatever, all this stuff.

232
00:14:02,500 --> 00:14:04,300
These those are the problems with Lightning.

233
00:14:04,300 --> 00:14:08,300
So these are each time one appears, it's like bad news

234
00:14:08,300 --> 00:14:10,800
because it means how many more are lurking around the corner.

235
00:14:10,800 --> 00:14:13,200
This is the kind of thing we were used to make fun of in Bitcoin.

236
00:14:13,300 --> 00:14:19,500
Like 2015, 2016, we made fun of people saying like Vitalik will fix it

237
00:14:19,500 --> 00:14:21,400
or Dan Larimer with BitShares, he would change it.

238
00:14:21,400 --> 00:14:22,800
He'd put out like some complicated thing.

239
00:14:22,800 --> 00:14:25,500
Someone would refute it. He'd change it again.

240
00:14:25,500 --> 00:14:28,100
Now we just we accept in Lightning this kind of thing

241
00:14:28,100 --> 00:14:32,400
that we would never have accepted in shitcoins in 2015.

242
00:14:32,400 --> 00:14:35,700
So we that's how far we've fallen.

243
00:14:35,700 --> 00:14:36,600
But yeah, I think yeah.

244
00:14:36,600 --> 00:14:39,700
Okay, let's try to get to say this is basically the end.

245
00:14:39,700 --> 00:14:41,000
So this is the end.

246
00:14:41,100 --> 00:14:44,000
So just trying to say like this is Theranos.

247
00:14:44,000 --> 00:14:46,400
Like it has the appearance of success,

248
00:14:46,400 --> 00:14:47,900
but really it was a scam the whole time.

249
00:14:47,900 --> 00:14:51,000
But like 10 years in it was reaching a 10 billion dollar.

250
00:14:51,000 --> 00:14:55,200
So it's very easy for something to I'll just skip though.

251
00:14:55,200 --> 00:14:58,800
Simulation. Okay with Drivechain BF300.

252
00:14:58,800 --> 00:15:02,200
I have code that simulates 8 billion users using it.

253
00:15:02,200 --> 00:15:05,400
But in Lightning you can't even begin to do this

254
00:15:05,400 --> 00:15:07,600
because it's not even possible.

255
00:15:07,600 --> 00:15:09,300
And then these people are talking about this.

256
00:15:09,300 --> 00:15:10,300
This is the last slide.

257
00:15:10,300 --> 00:15:12,300
So I'll just this is like you have to decide

258
00:15:12,300 --> 00:15:15,700
which of these two theories you kind of endorse.

259
00:15:15,700 --> 00:15:18,100
There's one where channels work.

260
00:15:18,100 --> 00:15:21,000
They're the future of Bitcoin. Engineers will solve the problems.

261
00:15:21,000 --> 00:15:23,000
In my theory, they don't work.

262
00:15:23,000 --> 00:15:25,700
It is no longer good use of your time.

263
00:15:25,700 --> 00:15:29,300
Engineers are playing pretentious games to win OpenSats grants or whatever.

264
00:15:29,300 --> 00:15:31,100
Okay, then the orthodox view is like

265
00:15:31,100 --> 00:15:34,600
that I'm here to FUD Lightning and shill Drivechains

266
00:15:34,600 --> 00:15:39,700
and I want more clout or something so that I can get BF300 activated.

267
00:15:39,700 --> 00:15:41,800
The truth is that Tidwell had to practically drag me here.

268
00:15:41,800 --> 00:15:45,200
I almost didn't come. Booked the flight like last week.

269
00:15:45,200 --> 00:15:48,700
And LN is going to collapse because it doesn't work.

270
00:15:48,700 --> 00:15:51,400
And BF300 does not need code changes to core

271
00:15:51,400 --> 00:15:56,200
and it will activate because of its effect on minor revenues and other things.

272
00:15:56,200 --> 00:15:57,700
So that's not the case.

273
00:15:57,700 --> 00:16:00,400
But the orthodox view would be that all Bitcoin and Lightning

274
00:16:00,400 --> 00:16:02,800
has all these smart and nice people and everyone can't be wrong.

275
00:16:02,900 --> 00:16:05,800
The truth is Lightning is from the block size war

276
00:16:05,800 --> 00:16:10,600
and it inherently has this propaganda dimension that it cannot get rid of.

277
00:16:10,600 --> 00:16:13,300
People are emotionally unwilling to admit they were wrong.

278
00:16:13,300 --> 00:16:16,100
And it's like, well, I invented my own Lightning technology in 2016.

279
00:16:16,100 --> 00:16:18,700
Maybe that's because my knowledge is very now obsolete.

280
00:16:18,700 --> 00:16:21,300
That's completely possible. Someone could say,

281
00:16:21,300 --> 00:16:24,900
well, we just invented the such and such and now Lightning works.

282
00:16:24,900 --> 00:16:28,100
But I think the alternative explanation is that it was early both times.

283
00:16:28,100 --> 00:16:31,500
It was early to join and early to leave and you'll be joining me eventually.

284
00:16:31,500 --> 00:16:35,200
Okay. So there you go. So let's try to sprint through that.

285
00:16:35,200 --> 00:16:38,700
But now I'm giving much more than,

286
00:16:38,700 --> 00:16:42,000
I'm giving three times the amount of time to the Q&A section.

287
00:16:42,000 --> 00:16:47,300
So that's making myself very vulnerable to anyone's questions.

288
00:16:47,300 --> 00:16:49,700
So as someone who's worked in custodial Lightning for six years,

289
00:16:49,700 --> 00:16:53,100
I'm highly offended.

290
00:16:53,100 --> 00:16:56,800
So I would ask, please someone break the ice.

291
00:16:56,800 --> 00:16:58,600
I'm asking people to be brave, break the ice.

292
00:16:58,600 --> 00:17:01,400
And no, no, do not raise your hand. You come up.

293
00:17:01,400 --> 00:17:05,300
So if you want to talk, queue up right here.

294
00:17:05,300 --> 00:17:08,700
I want to bring you on. And then if you want to just write a topic on the whiteboard

295
00:17:08,700 --> 00:17:10,500
and not be on stage, but make sure we cover it,

296
00:17:10,500 --> 00:17:12,500
you can come up here right on the whiteboard.

297
00:17:12,500 --> 00:17:16,400
You can go up and you can be third. Pause right here.

298
00:17:16,400 --> 00:17:21,300
All right. So Paul, we'll kind of co-manage this.

299
00:17:21,300 --> 00:17:23,400
Yeah, I think you should just do whatever you think the audience appreciates.

300
00:17:23,400 --> 00:17:26,200
And also if you are done making your point or you're done,

301
00:17:26,200 --> 00:17:29,900
you can self-exodus yourself off the panel

302
00:17:30,000 --> 00:17:31,700
if you don't want to wait for me to get it to you.

303
00:17:31,700 --> 00:17:36,600
Okay. Now it's on. Hey, hey Paul.

304
00:17:36,600 --> 00:17:39,400
Thanks. I mostly agree with you, which I'm shocked to say.

305
00:17:39,400 --> 00:17:41,600
Yeah, so we got one. I just want to I thought about doing this.

306
00:17:41,600 --> 00:17:44,500
I thought about really making myself vulnerable by having like a tally of like

307
00:17:44,500 --> 00:17:47,300
how many people will come up and they say mostly agree with me.

308
00:17:47,300 --> 00:17:50,900
That's another prediction I had. Here's the thing though.

309
00:17:50,900 --> 00:17:56,200
You're mostly right and you're still wrong because Lightning is a massive success.

310
00:17:56,200 --> 00:18:01,800
It's the only successful scaled second layer in basically blockchains worldwide.

311
00:18:01,800 --> 00:18:04,200
It's it actually works amazingly well.

312
00:18:04,200 --> 00:18:06,500
It just doesn't do everything it was sold to do.

313
00:18:06,500 --> 00:18:10,400
And so you can knock it down correctly by saying that it over promised

314
00:18:10,400 --> 00:18:14,000
and it did not deliver on every single promise that people thought it was making.

315
00:18:14,000 --> 00:18:16,900
And most of that as you as you said in talking about Taj is

316
00:18:16,900 --> 00:18:20,200
that the promises weren't actually written in the Lightning paper.

317
00:18:20,200 --> 00:18:23,200
They were made by other people. Lightning does what it said on the tin

318
00:18:23,200 --> 00:18:25,100
and it does that amazingly well. It routes payments.

319
00:18:25,100 --> 00:18:27,700
It scales the payment throughput of the network.

320
00:18:27,700 --> 00:18:31,500
It does not really scale very well the user throughput of the network

321
00:18:31,500 --> 00:18:33,400
and that is something we still need to solve

322
00:18:33,400 --> 00:18:37,300
and things like Ark and Spark and others may be able to solve that.

323
00:18:37,300 --> 00:18:39,800
But yeah, it's not that Lightning failed.

324
00:18:39,800 --> 00:18:43,000
It's that some people not the authors of Lightning lied about it

325
00:18:43,000 --> 00:18:46,600
or miss misinterpreted what it could do.

326
00:18:46,600 --> 00:18:49,400
Yeah, and in particular I think Taj is was very honest

327
00:18:49,400 --> 00:18:53,000
and when I say the Lightning cult, I always say Taj is not in the Lightning.

328
00:18:53,100 --> 00:18:56,700
It always surprises people. I say that but I say it all the time.

329
00:18:56,700 --> 00:18:59,500
I'm sure Taj is thrilled that I talk about him so often.

330
00:18:59,500 --> 00:19:02,800
But I just like to point out that basically what he said was just now

331
00:19:02,800 --> 00:19:07,500
is that Lightning is not going to be the thing that scales Bitcoin to 8 billion
people.

332
00:19:07,500 --> 00:19:09,700
That's exactly what I was saying.

333
00:19:09,700 --> 00:19:11,100
I think the question of...

334
00:19:11,100 --> 00:19:12,500
That doesn't make it a failure though.

335
00:19:12,500 --> 00:19:16,000
But I think the criteria for success is unrelated to the promises.

336
00:19:16,000 --> 00:19:19,000
So I don't care about what was promised.

337
00:19:19,000 --> 00:19:22,000
I'm just saying this idea is not... I'm just saying it's about the future.

338
00:19:22,000 --> 00:19:24,500
This isn't about the past 10 years.

339
00:19:24,500 --> 00:19:26,300
This is not the thing to invest your time in.

340
00:19:26,300 --> 00:19:30,300
But you made a specific claim, which was that Lightning will collapse.

341
00:19:30,300 --> 00:19:33,400
And I'm making a character claim that Lightning will continue to thrive

342
00:19:33,400 --> 00:19:36,300
in doing what it does, which is scaling numbers of payments

343
00:19:36,300 --> 00:19:38,500
between entities who are on the Lightning network.

344
00:19:38,500 --> 00:19:42,400
It's amazing at that. It'll not stop doing that. It'll keep doing it.

345
00:19:42,400 --> 00:19:44,300
I don't think it will do that.

346
00:19:44,300 --> 00:19:45,700
What would defend that claim?

347
00:19:45,700 --> 00:19:48,900
Your claims so far have defended that it will scale to users.

348
00:19:48,900 --> 00:19:52,700
This is why I had the Venmo me point that I didn't quite get to flesh out.

349
00:19:52,700 --> 00:19:56,800
But the payment networks themselves have network effects

350
00:19:56,800 --> 00:19:59,100
in addition to other things.

351
00:19:59,100 --> 00:20:03,600
Just for formatting, make your point very clear before dialogue.

352
00:20:03,600 --> 00:20:08,800
So make the point that you either agree with or want to debate specifically.

353
00:20:08,800 --> 00:20:11,300
But I'll just finish.

354
00:20:11,300 --> 00:20:13,300
Like when people say Venmo me some money or something,

355
00:20:13,300 --> 00:20:18,000
or they say, you know, like give me a Kleenex or Xerox or Tweet or whatever.

356
00:20:18,100 --> 00:20:20,300
It becomes a verb.

357
00:20:20,300 --> 00:20:24,600
The payment networks themselves, like when something else is used by most people,

358
00:20:24,600 --> 00:20:26,100
it will crowd out the other things.

359
00:20:26,100 --> 00:20:29,200
And eventually that the one thing that scales to 8 billion people

360
00:20:29,200 --> 00:20:30,300
will be what everyone uses.

361
00:20:30,300 --> 00:20:34,300
They will not use some tiny little thing that uses,

362
00:20:34,300 --> 00:20:37,700
you know, it's very much like the TCP IP analogy

363
00:20:37,700 --> 00:20:40,500
where of course there are these other things, but it's not like.

364
00:20:40,500 --> 00:20:42,500
I'm going to admit myself when I have to say this.

365
00:20:42,500 --> 00:20:46,100
Do you use Fedwire?

366
00:20:46,100 --> 00:20:48,300
Well, I don't know how to answer that question.

367
00:20:48,300 --> 00:20:50,400
I have sent a wire before.

368
00:20:50,400 --> 00:20:54,500
I guess I don't use the Fedwire moves reserves as a completely different question,

369
00:20:54,500 --> 00:20:56,100
but let's move on to the next question.

370
00:20:56,100 --> 00:21:01,200
Yeah, so I think the lightning is what we need to actually scale Bitcoin.

371
00:21:01,200 --> 00:21:05,700
So we're never going to get 8 billion people on the main chain.

372
00:21:05,700 --> 00:21:12,400
We are going to need some form of way for anyone to receive and send transactions.

373
00:21:12,400 --> 00:21:19,400
Also, main chain fees make it very limiting for people in poor countries to actually
use it.

374
00:21:19,400 --> 00:21:24,100
With lightning, you can have one channel that's run by someone

375
00:21:24,100 --> 00:21:29,500
and multiple people can use to actually transact with minimal,

376
00:21:29,500 --> 00:21:32,400
if not no fees at all.

377
00:21:32,400 --> 00:21:35,900
This is actually not true though.

378
00:21:35,900 --> 00:21:36,500
How so?

379
00:21:36,500 --> 00:21:39,900
I explained why there's not everyone can't open one channel.

380
00:21:39,900 --> 00:21:41,500
Not in practice.

381
00:21:41,500 --> 00:21:43,700
Not everyone is a channel.

382
00:21:43,700 --> 00:21:44,400
Just like a bank.

383
00:21:44,400 --> 00:21:47,200
But also the premise that we don't need to scale to 8 billion people.

384
00:21:47,200 --> 00:21:50,800
I mean, that's what I'm here to talk about.

385
00:21:50,800 --> 00:21:54,800
So again, if you're just going to admit defeat,

386
00:21:54,800 --> 00:22:00,300
then like I'm talking about of all the technologies that will scale us to 8 billion
people,

387
00:22:00,300 --> 00:22:01,800
lightning will not work.

388
00:22:01,800 --> 00:22:06,500
And furthermore, one of them will work and then it will just crowd out the other
ones.

389
00:22:06,500 --> 00:22:11,200
It will just stomp the other ones to death.

390
00:22:11,400 --> 00:22:14,600
Just passively by doing nothing.

391
00:22:14,600 --> 00:22:16,500
I'm going to twist a little bit here.

392
00:22:16,500 --> 00:22:19,800
So I mean, I think there are two things that you don't have on your list

393
00:22:19,800 --> 00:22:22,100
that I'm very concerned about.

394
00:22:22,100 --> 00:22:25,900
So I'll start off with, I do agree it's not going to scale.

395
00:22:25,900 --> 00:22:29,800
I do believe that it will at some point will be a niche

396
00:22:29,800 --> 00:22:34,200
that some people will use for very specific purposes for very specific communities.

397
00:22:34,200 --> 00:22:39,300
But you know, so I'll agree with you in that evaluation.

398
00:22:39,300 --> 00:22:46,600
But my bigger concern is that it's very much a distributed technology

399
00:22:46,600 --> 00:22:48,800
rather than a decentralized technology.

400
00:22:48,800 --> 00:22:53,900
It is very vulnerable to network effects that will encourage centralization

401
00:22:53,900 --> 00:23:00,900
of payment channels with various parties.

402
00:23:00,900 --> 00:23:05,100
It's really hard to fix this.

403
00:23:05,200 --> 00:23:12,400
And then I'm also very concerned about the persistence requirements of lightning

404
00:23:12,400 --> 00:23:16,800
which I think it's everything from the fact that Blockstream will say,

405
00:23:16,800 --> 00:23:25,000
well, we don't want to do identity and yet their lightning store

406
00:23:25,000 --> 00:23:30,100
has the same identity that it did seven years ago when they launched it.

407
00:23:30,100 --> 00:23:34,400
That's identity even if you're saying you're not doing identity.

408
00:23:34,400 --> 00:23:41,100
So these kind of persistence things are going to have lots of opportunities

409
00:23:41,100 --> 00:23:51,400
for denial of service, for various other different types of out of the protocol
problems

410
00:23:51,400 --> 00:23:53,200
if they become economically important.

411
00:23:53,200 --> 00:23:55,100
Yeah, I completely agree and there's not enough time.

412
00:23:55,100 --> 00:23:59,100
This is like the fastest I've ever created slides, like slide per minute ratio

413
00:23:59,100 --> 00:24:02,100
because I just had so many ideas in my head about like what to say

414
00:24:02,100 --> 00:24:03,700
about how lightning is a terrible idea.

415
00:24:04,500 --> 00:24:07,400
There was a recent tweet from like a lightning CEO who basically said

416
00:24:07,400 --> 00:24:11,000
we have to just give up on payments and self-custody or something.

417
00:24:11,000 --> 00:24:13,400
And I was like, okay, well, like there you go.

418
00:24:13,400 --> 00:24:17,000
But I just want to also say about the gentleman in the middle about,

419
00:24:17,000 --> 00:24:21,200
you know, I completely agree that we need to scale in layers

420
00:24:21,200 --> 00:24:22,900
and that everyone will not be on L1.

421
00:24:22,900 --> 00:24:24,800
I think that has nothing to do with the lightning network at all.

422
00:24:24,800 --> 00:24:29,400
And in fact, the fact that the lightning network has parasitically brainwashed
everyone

423
00:24:29,500 --> 00:24:35,700
into thinking that L2 equals lightning network is by far the worst thing about the
lightning network.

424
00:24:35,700 --> 00:24:36,500
By far.

425
00:24:37,500 --> 00:24:41,900
Real quick, Danny, if you can respond in closing statement and then we'll have you
off.

426
00:24:41,900 --> 00:24:45,900
Yeah, I mean, I think that somebody in, for example, Africa will never be able to,

427
00:24:45,900 --> 00:24:50,700
let's say Kenya or something like that, will never be able to do an L1 payment
anyways.

428
00:24:50,700 --> 00:24:55,900
And yeah, maybe there are some other layer twos that are going to be better,

429
00:24:55,900 --> 00:24:58,400
but what we have now is okay.

430
00:24:58,455 --> 00:25:01,455
And maybe in the future, we're going to switch to something else.

431
00:25:01,455 --> 00:25:06,455
I don't think lightning is the end goal, but it's good enough for now.

432
00:25:06,455 --> 00:25:09,455
That's my guess.

433
00:25:09,455 --> 00:25:16,455
Hi, Paul. When we first met, I don't know if you remember, but I introduced myself
to you as your biggest hater.

434
00:25:16,455 --> 00:25:21,455
Yes, I think I remember seeing a tweet that says a helpful tool fails and dies or
whatever.

435
00:25:22,455 --> 00:25:28,455
But I do have to say that after meeting you and talking to you more and doing some
more research,

436
00:25:28,455 --> 00:25:38,455
I think one of maybe the bigger points I would make in favor of something, say, like
drag chains is that

437
00:25:38,455 --> 00:25:49,455
lightning is, as you said earlier, it's almost a little parasitic in that it doesn't
really have a good solution for the long-term security budget of Bitcoin.

438
00:25:49,455 --> 00:25:54,455
Yeah, I also wanted to have a whole slide about this, and there was just a bullet
point that I skipped.

439
00:25:54,455 --> 00:26:00,455
But the mind versus non-mind L2s, that was one of the giant tweets that I had of 10
points.

440
00:26:00,455 --> 00:26:06,455
That was one of the points. And I'd like to also emphasize, 99% of all new ideas
don't succeed at all.

441
00:26:06,455 --> 00:26:12,455
And for any new idea to work, you need to do everything perfectly.

442
00:26:12,455 --> 00:26:18,455
If you could be a person and you could starve to death or you could drown or you
could get executed,

443
00:26:18,455 --> 00:26:21,455
you could get framed for a crime and then killed by the government or something.

444
00:26:21,455 --> 00:26:25,455
So there's lots of ways of dying and failing, and you need to do everything
perfectly.

445
00:26:25,455 --> 00:26:30,455
And this lightning just has many of these things, each of which would kill the idea.

446
00:26:30,455 --> 00:26:35,455
And another point I would make is that although blockchains are a bit of a
panopticon

447
00:26:35,455 --> 00:26:41,455
and securing additional blockchains against Bitcoin with drag chains could result in
lower privacy,

448
00:26:41,455 --> 00:26:52,455
allowing the possibility of 256 different options for people to use for scaling
Bitcoin stats,

449
00:26:52,455 --> 00:26:58,455
one of them should have the capability to use, say, zero-knowledge proofs or
something.

450
00:26:58,455 --> 00:27:04,455
Yeah, we have one already. We have a clone of the Zcash Rust crate library inserted
into one.

451
00:27:04,455 --> 00:27:07,455
This sounds like a commercial now.

452
00:27:07,455 --> 00:27:10,455
So that could have more privacy.

453
00:27:10,455 --> 00:27:12,455
Real quick, real quick. Let me cut you off.

454
00:27:12,455 --> 00:27:15,455
Is there anything that you disagree?

455
00:27:15,455 --> 00:27:21,455
Is there any specific point that is a friction with Paul's framing and context?

456
00:27:21,455 --> 00:27:23,455
I don't disagree with Paul at all.

457
00:27:23,455 --> 00:27:27,455
All right. I want to ask you to wrap up.

458
00:27:27,455 --> 00:27:29,455
All right.

459
00:27:29,455 --> 00:27:35,455
Paul, I want to challenge your entire central assertion that lightning is going to
collapse on itself

460
00:27:35,455 --> 00:27:38,455
because payment networks need network effect.

461
00:27:38,455 --> 00:27:45,455
Lightning has established itself as the uncontestable king and central point of that
type of network effect.

462
00:27:45,455 --> 00:27:51,455
Its existence and the very use of HTLCs or PTLCs or any of these other constructs

463
00:27:51,455 --> 00:27:55,455
allow it to interlink with any other system that supports these type of
capabilities.

464
00:27:55,455 --> 00:28:02,455
And you already see in the development of other Layer 2 systems like state chains
with Spark, like ARK,

465
00:28:02,455 --> 00:28:07,455
that their entire design goals are doing exactly that.

466
00:28:07,455 --> 00:28:10,455
Pivoting around to interlinking with the lightning network

467
00:28:10,455 --> 00:28:15,455
because it is the existing network effect that can actually cross multiple systems.

468
00:28:15,455 --> 00:28:20,455
It has the network effect now out of all the other terrible ideas that have been
coming out.

469
00:28:20,455 --> 00:28:23,455
But that's not on its merit.

470
00:28:23,455 --> 00:28:29,455
There are about 9 trillion or so transactions per year by everyone on earth.

471
00:28:29,455 --> 00:28:31,455
As far as I could tell. I tried the best I could.

472
00:28:31,455 --> 00:28:36,455
But obviously lightning is like 1 billionth of 1 billionth of 1% or whatever of
that.

473
00:28:36,455 --> 00:28:39,455
We're talking about Bitcoin payments.

474
00:28:39,455 --> 00:28:41,455
Yeah, but I'm talking about all the payments.

475
00:28:41,455 --> 00:28:45,455
So this is what I'm talking about the future payment thing that actually succeeds.

476
00:28:45,455 --> 00:28:53,455
And the fact that it's currently bigger than some things now, that doesn't really
mean that it will...

477
00:28:53,455 --> 00:28:57,455
It's bigger than everything else. And that's exactly how network effects grow.

478
00:28:57,455 --> 00:29:02,455
What is the most established network effect is what people gravitate towards.

479
00:29:02,455 --> 00:29:06,455
And that is the process by which that thing's network effect expands

480
00:29:06,455 --> 00:29:10,455
and creates a larger incentive for people to participate in that network

481
00:29:10,455 --> 00:29:12,455
versus attempting to bootstrap something new.

482
00:29:12,455 --> 00:29:16,455
We are already demonstrably seeing this with other Layer 2s.

483
00:29:16,455 --> 00:29:21,455
Even if this were true, that it's the biggest, it's number one, and it will continue
to grow forever,

484
00:29:21,455 --> 00:29:25,455
and runaway network effect, it has to hit a ceiling as I already explained.

485
00:29:25,455 --> 00:29:28,455
It hits the ceiling at the L1 channel opening.

486
00:29:28,455 --> 00:29:32,455
Lightning itself doesn't have to be the thing that end-users interact with.

487
00:29:32,455 --> 00:29:35,455
We have things like Spark. We have channel factories.

488
00:29:35,455 --> 00:29:38,455
We have basic channel factories like ARK.

489
00:29:38,455 --> 00:29:41,455
I'd like to address the point about everyone saying that, oh yeah, like,

490
00:29:41,455 --> 00:29:43,455
effetiment interactivity with lightning.

491
00:29:43,455 --> 00:29:49,455
Every other Layer 2 in existence on Bitcoin right now is either designed to be

492
00:29:49,455 --> 00:29:53,455
or does support atomically linking into the Lightning network.

493
00:29:53,455 --> 00:29:56,455
I'd like to address this point, which is every Layer 2 that exists right now.

494
00:29:56,455 --> 00:30:00,455
This is all related to what I told you before about when I was doing the
fundraising.

495
00:30:00,455 --> 00:30:04,455
A lot of people have invested in Lightning startups, and they want some narrative

496
00:30:04,455 --> 00:30:06,455
that this is going to help their Lightning.

497
00:30:06,455 --> 00:30:08,455
It's not a narrative. It's demonstrable facts.

498
00:30:08,455 --> 00:30:14,455
It's further evidence of what has become to be overt fraud and basically just social
pressure

499
00:30:14,455 --> 00:30:17,455
on people to sell the narrative that Lightning is working.

500
00:30:17,455 --> 00:30:20,455
And it is not evidence of the merits of Lightning.

501
00:30:20,455 --> 00:30:24,455
The users who use Lightning, they don't even realize they're using custodial
Lightning.

502
00:30:24,455 --> 00:30:28,455
The whole idea is just a sinking ship, and it is not actually working.

503
00:30:28,455 --> 00:30:33,455
Paul, Spark users, ARK users, Liquid users, on-chain users, all of them,

504
00:30:33,455 --> 00:30:40,455
every single one of those things can factually right now page other through the
Lightning network.

505
00:30:40,455 --> 00:30:42,455
Every single one of them.

506
00:30:42,455 --> 00:30:44,455
All right, all right.

507
00:30:44,455 --> 00:30:45,455
And it's just early days.

508
00:30:45,455 --> 00:30:47,455
Funny enough, I feel like I was listening to both of them,

509
00:30:47,455 --> 00:30:49,455
even though they're both talking at the same time.

510
00:30:49,455 --> 00:30:53,455
Somehow, the voices are so much different.

511
00:30:53,455 --> 00:30:58,455
But I would say, real quick, I know you had a quick question.

512
00:30:58,455 --> 00:31:00,455
Let me hand it to Stu real quick.

513
00:31:00,455 --> 00:31:01,455
Hi, Paul.

514
00:31:01,455 --> 00:31:04,455
Obviously, I agree with everything that you said.

515
00:31:04,455 --> 00:31:06,455
Great, thank you.

516
00:31:06,455 --> 00:31:09,455
But my question is, if you hate Lightning so much,

517
00:31:09,455 --> 00:31:17,455
then why is it cited in the BIP301 to do Blind Merged Mining requests?

518
00:31:17,455 --> 00:31:19,455
I was originally enthusiastic about it,

519
00:31:19,455 --> 00:31:23,455
and there is a way to do half of the Blind Merged Mining completely off-chain,

520
00:31:23,455 --> 00:31:27,455
and I thought that people would like that option.

521
00:31:27,455 --> 00:31:32,455
And so that is for Blind Merged Mining, not BIP300, but in 301.

522
00:31:32,455 --> 00:31:34,455
I think Blind Merged Mining, I don't know.

523
00:31:34,455 --> 00:31:37,455
At one point, there was one guy who didn't like,

524
00:31:37,455 --> 00:31:40,455
but everyone, I think BIP300 is where all the controversy was.

525
00:31:40,455 --> 00:31:45,455
Blind Merged Mining is too simple, and since merge mining already exists,

526
00:31:45,455 --> 00:31:48,455
I don't think – there was one guy who didn't like 301,

527
00:31:48,455 --> 00:31:50,455
and then he came around and he said, I like 301 now.

528
00:31:50,455 --> 00:31:54,455
So that was – 301 is the more popular one, and it's optional.

529
00:31:54,455 --> 00:31:55,455
One of the two optional ways to –

530
00:31:55,455 --> 00:31:56,455
But you've got to rewrite the BIP.

531
00:31:56,455 --> 00:31:58,455
To just like delete it maybe. I don't know.

532
00:31:58,455 --> 00:32:00,455
Yeah, you need to fix it.

533
00:32:00,455 --> 00:32:03,455
Doing more damage than it's –

534
00:32:03,455 --> 00:32:11,455
Okay, that was it. Thanks.

535
00:32:11,455 --> 00:32:15,455
So somebody asked me to watch one of your videos

536
00:32:15,455 --> 00:32:18,455
and critique everything that you had said,

537
00:32:18,455 --> 00:32:20,455
because I happen to like lightning.

538
00:32:20,455 --> 00:32:25,455
And I watched it, and everything you said was wrecked.

539
00:32:25,455 --> 00:32:26,455
Yeah, I get this sometimes too.

540
00:32:26,455 --> 00:32:27,455
But I haven't actually –

541
00:32:27,455 --> 00:32:28,455
People email me and they say, I didn't know.

542
00:32:28,455 --> 00:32:30,455
I'm an engineer at a lightning company.

543
00:32:30,455 --> 00:32:32,455
After I read your blog post about it not working,

544
00:32:32,455 --> 00:32:36,455
now I kind of understand how it was supposed to work for the first time.

545
00:32:36,455 --> 00:32:40,455
And I've been working full-time for years as a lightning engineer.

546
00:32:40,455 --> 00:32:45,455
So my question is, what if we come up with a way

547
00:32:45,455 --> 00:32:49,455
that we can have custodians without trust?

548
00:32:49,455 --> 00:32:50,455
Yeah, I think the idea –

549
00:32:50,455 --> 00:32:54,455
One thing that I defended in something in 2015 that I wrote

550
00:32:54,455 --> 00:32:58,455
about measuring decentralization was that lightning,

551
00:32:58,455 --> 00:33:00,455
it wouldn't matter if it became hub and spoke,

552
00:33:00,455 --> 00:33:05,455
because you can always just cash out and switch hubs.

553
00:33:05,455 --> 00:33:08,455
But it turns out that that was too optimistic.

554
00:33:08,455 --> 00:33:13,455
But that was what I originally thought would be how lightning actually did work,

555
00:33:13,455 --> 00:33:15,455
because, of course, there were many large blockers at the time

556
00:33:15,455 --> 00:33:17,455
complaining it should be hub and spoke.

557
00:33:17,455 --> 00:33:21,455
And now in practice with the custodial lightning, it's very hub and spoke.

558
00:33:21,455 --> 00:33:26,455
It's actually so hub and spoke that even the things connecting to the spoke

559
00:33:26,455 --> 00:33:30,455
aren't even there, so it's only a hub.

560
00:33:30,455 --> 00:33:34,455
So I originally liked that idea a lot, but in practice,

561
00:33:34,455 --> 00:33:39,455
I don't think it will be competitive with what will be coming down the road

562
00:33:39,455 --> 00:33:45,455
in terms of both BIP300, my own idea, but also these other things, roll-ups, et
cetera.

563
00:33:45,455 --> 00:33:49,455
So I've been working on a proposed protocol

564
00:33:49,455 --> 00:33:55,455
that would have cryptographically verifiable ledgers in channels,

565
00:33:55,455 --> 00:34:03,455
and I'm trying to scale this idea out because there's no UTXO per wallet.

566
00:34:03,455 --> 00:34:08,455
So if it works in a trustless way, it should scale to everyone.

567
00:34:08,455 --> 00:34:11,455
The key, I think, to getting the scaling to work is

568
00:34:11,455 --> 00:34:15,455
people have to be able to share a UTXO without updating the UTXO on L1.

569
00:34:15,455 --> 00:34:18,455
And so sort of CTV was on the right track with that,

570
00:34:18,455 --> 00:34:22,455
ARC is on the right track, and BIP300, my own idea, are on the right track with
that.

571
00:34:22,455 --> 00:34:25,455
And, of course, the custodians do that all the time where they just say,

572
00:34:25,455 --> 00:34:30,455
well, we own this UTXO, and we say that you have $10 here,

573
00:34:30,455 --> 00:34:32,455
and hopefully we'll give it to you in the future.

574
00:34:32,455 --> 00:34:36,455
Is it wrong if we just say that there's never a UTXO,

575
00:34:36,455 --> 00:34:38,455
and the goal is not to let you exit to the chain,

576
00:34:38,455 --> 00:34:41,455
but just to make sure that you stay inside the system?

577
00:34:41,455 --> 00:34:44,455
I think this is related to what Reardon or whoever that was,

578
00:34:44,455 --> 00:34:46,455
Sunglass Guy, was saying about me not using Fed.

579
00:34:46,455 --> 00:34:48,455
Like, we don't use—

580
00:34:48,455 --> 00:34:50,455
You weren't supposed to dox them.

581
00:34:50,455 --> 00:34:52,455
In the payments, everyone's been doxed.

582
00:34:52,455 --> 00:34:54,455
If you come up here—no, I'm just kidding.

583
00:34:54,455 --> 00:34:59,455
If you have a pyramid where we pay each other,

584
00:34:59,455 --> 00:35:02,455
maybe with Venmo—Venmo has a commercial bank,

585
00:35:02,455 --> 00:35:05,455
Wells Fargo, Bank of America, or something.

586
00:35:05,455 --> 00:35:10,455
You have this—they settle amongst each other with the Federal Reserve,

587
00:35:10,455 --> 00:35:12,455
which is like a bank of banks,

588
00:35:12,455 --> 00:35:14,455
and then there's the Bank of International Settlements,

589
00:35:14,455 --> 00:35:17,455
which is like all the different Federal Reserves of the world have an account there.

590
00:35:17,455 --> 00:35:20,455
So there's this huge pyramid, and I think it's correct to say

591
00:35:20,455 --> 00:35:23,455
that we live on layer four of the fiat world,

592
00:35:23,455 --> 00:35:25,455
and we don't really go—we don't have reserves.

593
00:35:25,455 --> 00:35:28,455
We never have any bank reserves, which only the Fed has,

594
00:35:28,455 --> 00:35:31,455
and we never have any Bank of International Settlement money,

595
00:35:31,455 --> 00:35:33,455
whatever the hell that's called again.

596
00:35:33,455 --> 00:35:37,455
May I ask real quick, any specific, concise follow-up,

597
00:35:37,455 --> 00:35:40,455
and like a closing sort of logic,

598
00:35:40,455 --> 00:35:45,455
and then after this, I want to go to a closing with Shinobi, and then—

599
00:35:45,455 --> 00:35:49,455
I mean, finance in general has problems,

600
00:35:49,455 --> 00:35:53,455
so I feel like if Lightning has some problems, that's still okay.

601
00:35:53,455 --> 00:35:55,455
I think the question fundamentally is

602
00:35:55,455 --> 00:35:58,455
whether we can scale to eight billion people,

603
00:35:58,455 --> 00:36:02,455
and if we can do something on Lightning to do that,

604
00:36:02,455 --> 00:36:06,455
does that solve the problem?

605
00:36:06,455 --> 00:36:10,455
Well, I mean, I just don't think it will work,

606
00:36:10,455 --> 00:36:13,455
and it will be dragged down by network effects, as I've said.

607
00:36:13,455 --> 00:36:17,455
Like, people like to use what their friends are using,

608
00:36:17,455 --> 00:36:19,455
and that's just really strong,

609
00:36:19,455 --> 00:36:24,455
and the fact that like one millionth of the Earth's population

610
00:36:24,455 --> 00:36:28,455
maybe whatever it is, 8,000 people use Lightning today,

611
00:36:28,455 --> 00:36:31,455
and that it's currently number one on the leaderboard of like a bunch of terrible
stuff,

612
00:36:31,455 --> 00:36:33,455
again, this is also not related.

613
00:36:33,455 --> 00:36:37,455
Like, Lightning has crowded out the other worse stuff,

614
00:36:37,455 --> 00:36:40,455
because the people behind, you know,

615
00:36:40,455 --> 00:36:42,455
people who are enthusiastic or invested in Lightning,

616
00:36:42,455 --> 00:36:44,455
either emotionally or financially,

617
00:36:44,455 --> 00:36:46,455
they don't want something else to come out

618
00:36:46,455 --> 00:36:48,455
that will just reveal that this has all been a ten-year waste of time.

619
00:36:48,455 --> 00:36:50,455
So it's related.

620
00:36:50,455 --> 00:36:55,455
The fact that Lightning is number one on the tiny leaderboard is partly a result of
that.

621
00:36:55,455 --> 00:36:59,455
So your biggest fan, Shinobi, is going to give some closing thoughts,

622
00:36:59,455 --> 00:37:01,455
and then he can cue back up if he needs.

623
00:37:01,455 --> 00:37:03,455
You just keep saying things.

624
00:37:03,455 --> 00:37:05,455
Like, saying it will get dragged down,

625
00:37:05,455 --> 00:37:08,455
and the network effect will implode is not an argument.

626
00:37:08,455 --> 00:37:10,455
It's not a reasoning for why,

627
00:37:10,455 --> 00:37:13,455
and the empirical reality right now is that

628
00:37:13,455 --> 00:37:17,455
that network effect is strengthening with every other system,

629
00:37:17,455 --> 00:37:19,455
like Arc, like Spark, like Liquid,

630
00:37:19,455 --> 00:37:23,455
that is connecting into the network effect of the Lightning network

631
00:37:23,455 --> 00:37:25,455
and making it larger.

632
00:37:25,455 --> 00:37:29,455
Like you said, that everybody wants to use the thing that everyone else is using.

633
00:37:29,455 --> 00:37:33,455
As more and more of these systems connect into the Lightning network,

634
00:37:33,455 --> 00:37:37,455
all of these different systems effectively become the same system,

635
00:37:37,455 --> 00:37:39,455
because Lightning glues them together,

636
00:37:39,455 --> 00:37:44,455
and that is a runaway snowball effect that will reinforce its network effect,

637
00:37:44,455 --> 00:37:46,455
not drag it down.

638
00:37:46,455 --> 00:37:48,455
I'd like to point out that...

639
00:37:48,455 --> 00:37:51,455
Oh, nice, we've got two people to applaud for that.

640
00:37:51,455 --> 00:37:52,455
That's great.

641
00:37:52,455 --> 00:37:54,455
Hey, I'd like to point out that eight people just came up here

642
00:37:54,455 --> 00:37:56,455
and said they agreed with me completely about everything.

643
00:37:56,455 --> 00:37:59,455
We set that against the two people who just clapped.

644
00:37:59,455 --> 00:38:02,455
I think that the idea that...

645
00:38:02,455 --> 00:38:05,455
Again, this is the emotional thing of Lightning.

646
00:38:05,455 --> 00:38:07,455
It's like people have dug in for ten years,

647
00:38:07,455 --> 00:38:09,455
and now this is...

648
00:38:09,455 --> 00:38:13,455
The network effects are not...

649
00:38:13,455 --> 00:38:15,455
They're not on the merits,

650
00:38:15,455 --> 00:38:18,455
and to the extent that Lightning draws people in,

651
00:38:18,455 --> 00:38:20,455
it's just wasting everyone's time,

652
00:38:20,455 --> 00:38:22,455
because it's just, as you heard, other people agreeing with me.

653
00:38:22,455 --> 00:38:26,455
It's just not going to work.

654
00:38:26,455 --> 00:38:29,455
Two quick, concise things.

655
00:38:29,455 --> 00:38:35,455
For your point about HTLCs kind of occasionally maybe not working

656
00:38:35,455 --> 00:38:41,455
for reasons of taking up size and costing money and such,

657
00:38:41,455 --> 00:38:46,455
are these problems assuaded by using something like adapter signatures,

658
00:38:46,455 --> 00:38:48,455
which have the same size as normal transactions?

659
00:38:48,455 --> 00:38:50,455
I know it's not the only point.

660
00:38:50,455 --> 00:38:51,455
Yes, there are many things.

661
00:38:51,455 --> 00:38:52,455
This is a very good point.

662
00:38:52,455 --> 00:38:55,455
It's a very fair thing to point out, but it's also frustrating.

663
00:38:55,455 --> 00:38:58,455
People can say, oh, there's HTLCs, but then we'll use PTLCs,

664
00:38:58,455 --> 00:39:00,455
or we'll use whatever, such and such thing.

665
00:39:00,455 --> 00:39:02,455
This is what I was trying to get at with the slide

666
00:39:02,455 --> 00:39:04,455
about the problems being to the core of the idea,

667
00:39:04,455 --> 00:39:08,455
where there's...

668
00:39:08,455 --> 00:39:10,455
Eventually, people might come up with a way.

669
00:39:10,455 --> 00:39:12,455
That's what I was trying to say a few points ago,

670
00:39:12,455 --> 00:39:16,455
where if you can update who owns the UTXO

671
00:39:16,455 --> 00:39:19,455
without broadcasting bytes to L1,

672
00:39:19,455 --> 00:39:22,455
or either minimizing that or ideally making it zero,

673
00:39:22,455 --> 00:39:24,455
that would be an idea that works.

674
00:39:24,455 --> 00:39:26,455
I think that's more of what these other ideas,

675
00:39:26,455 --> 00:39:28,455
including ARC, are trying to go for.

676
00:39:28,455 --> 00:39:31,455
In my opinion, that just is too different from the Lightning Network

677
00:39:31,455 --> 00:39:34,455
for Lightning to then later claim victory that, oh, we can handle these problems,

678
00:39:34,455 --> 00:39:39,455
but people working together for 10 years on a team of 200

679
00:39:39,455 --> 00:39:42,455
super high IQ people eventually came up with new ideas

680
00:39:42,455 --> 00:39:44,455
that patched it all up.

681
00:39:44,455 --> 00:39:46,455
That wouldn't really count for me.

682
00:39:46,455 --> 00:39:51,455
My second point was actually really much on this topic of...

683
00:39:51,455 --> 00:39:53,455
I just wanted to push back on the title,

684
00:39:53,455 --> 00:39:56,455
that it's a waste of time and developer energy,

685
00:39:56,455 --> 00:40:01,455
because I think that it's actually been extremely beneficial

686
00:40:01,455 --> 00:40:05,455
for people to be thinking in this mode and related modes

687
00:40:05,455 --> 00:40:08,455
and to develop solutions to all these problems that keep popping up,

688
00:40:08,455 --> 00:40:11,455
because they aren't unique to Lightning.

689
00:40:11,455 --> 00:40:15,455
I personally just think that it's kind of like,

690
00:40:15,455 --> 00:40:19,455
even in a future where Lightning just completely doesn't work,

691
00:40:19,455 --> 00:40:21,455
I think a lot of good will have come out of it

692
00:40:21,455 --> 00:40:26,455
and a lot of the development on the research that happens with Lightning.

693
00:40:26,455 --> 00:40:30,455
I'll go until I physically collapse and cannot speak anymore,

694
00:40:30,455 --> 00:40:33,455
but we have the schedule, so I don't know if...

695
00:40:33,455 --> 00:40:35,455
Are we ruining the schedule with this? We're going over or what?

696
00:40:35,455 --> 00:40:37,455
I'll go forever.

697
00:40:37,455 --> 00:40:39,455
No, no, no. We're good. Keep going.

698
00:40:39,455 --> 00:40:41,455
We're good for another 20...

699
00:40:41,455 --> 00:40:46,455
Yeah, yeah. I was just genuinely clapping to Nadav's great response.

700
00:40:46,455 --> 00:40:48,455
I thought you were trying to wrap it up or something.

701
00:40:48,455 --> 00:40:52,455
No, no. I'm participating, too.

702
00:40:52,455 --> 00:40:55,455
All right, great. I'm glad we have way more time.

703
00:40:55,455 --> 00:40:58,455
I'm glad that a lot of people get a lot...

704
00:40:58,455 --> 00:41:00,455
I've heard this also, where people say,

705
00:41:00,455 --> 00:41:03,455
well, I like Lightning. It's like, okay, great.

706
00:41:03,455 --> 00:41:08,455
Okay, I guess I specifically just meant the premise

707
00:41:08,455 --> 00:41:10,455
that this is a waste of all of this developer energy.

708
00:41:10,455 --> 00:41:12,455
But don't you understand what I mean by that?

709
00:41:12,455 --> 00:41:17,455
I mean this is not the best idea out of the pile.

710
00:41:17,455 --> 00:41:19,455
Okay, but it's not one idea.

711
00:41:19,455 --> 00:41:23,455
PTLCs are useful for a lot of non-loading protocols.

712
00:41:23,455 --> 00:41:24,455
Yeah, and it is...

713
00:41:24,455 --> 00:41:27,455
Any idea we try, people will learn a lot and it will be...

714
00:41:27,455 --> 00:41:29,455
And I did write a different thing about

715
00:41:29,455 --> 00:41:31,455
people thought fraud proofs are impossible.

716
00:41:31,455 --> 00:41:35,455
In 2016, an article saying that only via payment channels

717
00:41:35,455 --> 00:41:38,455
or the Lightning Network are fraud proofs possible

718
00:41:38,455 --> 00:41:41,455
because you need some way to get the word out about a block

719
00:41:41,455 --> 00:41:43,455
without it being...

720
00:41:43,455 --> 00:41:45,455
But anyway, I'm just saying that.

721
00:41:45,455 --> 00:41:47,455
So I think that it's true that as...

722
00:41:47,455 --> 00:41:49,455
I think Chris Rowland, doxing everyone now,

723
00:41:49,455 --> 00:41:53,455
as he said, there will be some things where

724
00:41:53,455 --> 00:41:58,455
the technology has a very targeted, specialized use,

725
00:41:58,455 --> 00:42:01,455
but it will not be the way people pay each other Bitcoin, I think.

726
00:42:01,455 --> 00:42:04,455
And I think that's what everyone assumes that it is,

727
00:42:04,455 --> 00:42:06,455
especially people like Peter McCormick,

728
00:42:06,455 --> 00:42:08,455
especially regular, normal people

729
00:42:08,455 --> 00:42:10,455
wandering around a Bitcoin conference.

730
00:42:10,455 --> 00:42:13,455
So I would consider it a win if everyone just said yes.

731
00:42:13,455 --> 00:42:16,455
Lightning is an extremely niche thing

732
00:42:16,455 --> 00:42:21,455
that will be used by very few people in the future.

733
00:42:21,455 --> 00:42:23,455
If that's what people are going to say,

734
00:42:23,455 --> 00:42:25,455
then I'm happy to agree with that.

735
00:42:26,455 --> 00:42:31,455
So I want to challenge the assumption that you stated

736
00:42:31,455 --> 00:42:36,455
that one big payment system on top of Bitcoin

737
00:42:36,455 --> 00:42:39,455
will take over or will have the maximum network effect

738
00:42:39,455 --> 00:42:41,455
and everyone will be using it.

739
00:42:41,455 --> 00:42:43,455
I want to challenge it on two time frames.

740
00:42:43,455 --> 00:42:46,455
One is the next 10-20 years.

741
00:42:46,455 --> 00:42:51,455
I don't think we know which system is the perfect one.

742
00:42:51,455 --> 00:42:53,455
We haven't figured out...

743
00:42:53,455 --> 00:42:56,455
We haven't even explored the whole design space of Bitcoin yet.

744
00:42:56,455 --> 00:42:59,455
So I think over the next 10-20, maybe even 30 years,

745
00:42:59,455 --> 00:43:04,455
we'll continue to explore different designs, different trade-offs.

746
00:43:04,455 --> 00:43:07,455
And during that time, Lightning will be...

747
00:43:07,455 --> 00:43:10,455
HTLCs, PTLCs, we don't even have to talk about Lightning.

748
00:43:10,455 --> 00:43:15,455
Some interoperable payment standard will be vital to Bitcoin.

749
00:43:15,455 --> 00:43:18,455
In the long term, I could imagine that what you're stating is true.

750
00:43:18,455 --> 00:43:20,455
I don't know if it will be true.

751
00:43:20,455 --> 00:43:22,455
There might be different trade-offs.

752
00:43:22,455 --> 00:43:23,455
One, privacy.

753
00:43:23,455 --> 00:43:25,455
Other people might prefer more scalability.

754
00:43:25,455 --> 00:43:28,455
And I don't know if we can find all of that in the same system.

755
00:43:28,455 --> 00:43:29,455
But I'm less sure.

756
00:43:29,455 --> 00:43:31,455
But in the short term, like 10, 20, 30 years,

757
00:43:31,455 --> 00:43:33,455
I think we still need Lightning or something similar.

758
00:43:33,455 --> 00:43:35,455
Well, I completely agree that we need the L2s again.

759
00:43:35,455 --> 00:43:40,455
I'm pro-soft fork. I'm pro-innovation. I'm pro-L2.

760
00:43:40,455 --> 00:43:42,455
I started the company LayerTwo Labs.

761
00:43:42,455 --> 00:43:45,455
It's the company name. I have the domain. LayerTwoLabs.com.

762
00:43:45,455 --> 00:43:48,455
And the Layer2 is great,

763
00:43:48,455 --> 00:43:52,455
but Lightning has tricked everyone into thinking that it's the only L2.

764
00:43:52,455 --> 00:43:54,455
So I completely agree that we will have...

765
00:43:54,455 --> 00:43:58,455
And that's why I even brought up a few times the criteria for a good L2 is

766
00:43:58,455 --> 00:44:03,455
it pays the miners' transaction fees so there's no target war.

767
00:44:03,455 --> 00:44:05,455
There's no misaligned incentive.

768
00:44:05,455 --> 00:44:10,455
And the other thing is you have to update who owns the claim on L1

769
00:44:10,455 --> 00:44:12,455
without using the L1 bytes.

770
00:44:13,455 --> 00:44:18,455
And that is why the channel opening idea and the HTLC idea,

771
00:44:18,455 --> 00:44:20,455
those both consume L1 bytes.

772
00:44:20,455 --> 00:44:22,455
So it's fundamental to the idea.

773
00:44:22,455 --> 00:44:25,455
It's not like, maybe we'll...

774
00:44:25,455 --> 00:44:26,455
It's too early to tell.

775
00:44:26,455 --> 00:44:29,455
It's not too early to tell. I mean, I can tell.

776
00:44:29,455 --> 00:44:31,455
I could tell in 2022.

777
00:44:31,455 --> 00:44:35,455
But do we have any better system that allows interoperability

778
00:44:35,455 --> 00:44:38,455
in a way that not every new system that we're building...

779
00:44:38,455 --> 00:44:40,455
The interoperability is... Well, not to interrupt,

780
00:44:40,455 --> 00:44:43,455
but I'm just trying to say that the interoperability is itself

781
00:44:43,455 --> 00:44:46,455
a claim that the network effects will crush everything.

782
00:44:46,455 --> 00:44:49,455
So it's like, when something works, people...

783
00:44:49,455 --> 00:44:51,455
You're interoperable with that one thing.

784
00:44:51,455 --> 00:44:54,455
So if BIP300 takes off, then...

785
00:44:54,455 --> 00:44:58,455
And there's 14 geographically distributed L2 blockchains,

786
00:44:58,455 --> 00:45:00,455
like what I predict,

787
00:45:00,455 --> 00:45:04,455
then you'll be interoperable with the one that is in your area,

788
00:45:04,455 --> 00:45:05,455
like the North America one.

789
00:45:05,455 --> 00:45:07,455
And everyone will be interoperable with the L2 they use.

790
00:45:07,455 --> 00:45:10,455
And if Arc takes off, or if whatever takes off,

791
00:45:10,455 --> 00:45:13,455
you'll be interoperable within the one that you use.

792
00:45:13,455 --> 00:45:14,455
You know what I mean?

793
00:45:14,455 --> 00:45:17,455
I'm kind of pushing back against the interoperability word.

794
00:45:17,455 --> 00:45:20,455
I'm saying that it's really network effects is what it is,

795
00:45:20,455 --> 00:45:24,455
because the interoperability will always be clunky,

796
00:45:24,455 --> 00:45:27,455
because it will always be kind of hard to make Arc,

797
00:45:27,455 --> 00:45:29,455
Lightning, everything like all...

798
00:45:29,455 --> 00:45:32,455
It would just be easier for people to just use the one that works.

799
00:45:32,455 --> 00:45:33,455
And this is all Cope.

800
00:45:33,455 --> 00:45:37,455
All of that about interoperability is just a way of bolting on

801
00:45:37,455 --> 00:45:42,455
some attempt at a genuinely new idea onto Lightning brand,

802
00:45:42,455 --> 00:45:44,455
because the Lightning brand is undefeated.

803
00:45:44,455 --> 00:45:48,455
Hey, by the way, we light teen to put you in a good mood.

804
00:45:48,455 --> 00:45:52,455
So we're going to convince you that light teen is at least a good idea.

805
00:45:52,455 --> 00:45:54,455
I feel better already.

806
00:45:54,455 --> 00:45:57,455
But closing statement and point...

807
00:45:57,455 --> 00:46:01,455
I think we don't know which system will be scaling Bitcoin to billions,

808
00:46:01,455 --> 00:46:04,455
which system will be the best one for privacy, scalability,

809
00:46:04,455 --> 00:46:06,455
all these things that we want.

810
00:46:06,455 --> 00:46:08,455
If we don't have interoperability now,

811
00:46:08,455 --> 00:46:11,455
then we risk settling on something suboptimal

812
00:46:11,455 --> 00:46:13,455
just due to network effects.

813
00:46:13,455 --> 00:46:15,455
That's why I'm a big fan of Lightning.

814
00:46:15,455 --> 00:46:19,455
That's why we just did the first Arc to Fetiman transaction

815
00:46:19,455 --> 00:46:21,455
like two months ago in Riga,

816
00:46:21,455 --> 00:46:23,455
and it just worked without the teams having talked to each other.

817
00:46:23,455 --> 00:46:26,455
That's the beauty of Lightning, not end-user payments.

818
00:46:26,455 --> 00:46:27,455
Thank you.

819
00:46:27,455 --> 00:46:29,455
Okay, great.

820
00:46:29,455 --> 00:46:31,455
A couple of quick statements and then a question.

821
00:46:31,455 --> 00:46:33,455
I think it's unfair to characterize Lightning

822
00:46:33,455 --> 00:46:35,455
as having brainwashed people,

823
00:46:35,455 --> 00:46:37,455
especially over the last year or two

824
00:46:37,455 --> 00:46:40,455
where all the other L2s that you've already mentioned,

825
00:46:40,455 --> 00:46:43,455
BitVM and Arc,

826
00:46:43,455 --> 00:46:46,455
and even Fetiman and Cache stuff have really started to take off.

827
00:46:46,455 --> 00:46:48,455
Before we were all tweeting about OpReturn,

828
00:46:48,455 --> 00:46:50,455
we were tweeting about OP_CAT and OP_CTV,

829
00:46:50,455 --> 00:46:54,455
and these Layer 2 structures are being built with these opcodes

830
00:46:54,455 --> 00:46:57,455
either being required,

831
00:46:57,455 --> 00:47:01,455
or at least Lightning's not the only L2,

832
00:47:01,455 --> 00:47:03,455
and to say to characterize Lightning as brainwashing people

833
00:47:03,455 --> 00:47:05,455
and that it's the only L2 I think is unfair.

834
00:47:05,455 --> 00:47:08,455
Well, luckily, after I wrote my article in 2022,

835
00:47:08,455 --> 00:47:10,455
people finally, we had the Bitcoin Season 2 idea,

836
00:47:10,455 --> 00:47:12,455
and everyone started to do a Lightning limitations panel,

837
00:47:12,455 --> 00:47:15,455
which is the title that I use on my blog.

838
00:47:15,455 --> 00:47:17,455
And so then, after I,

839
00:47:17,455 --> 00:47:19,455
someone who's not even a Lightning developer,

840
00:47:19,455 --> 00:47:21,455
after I wrote that thing,

841
00:47:21,455 --> 00:47:23,455
I'm not trying to claim 100% of the responsibility,

842
00:47:23,455 --> 00:47:25,455
but this is the timeline,

843
00:47:25,455 --> 00:47:27,455
is that after I wrote about

844
00:47:27,455 --> 00:47:29,455
how it's not going to work fundamentally,

845
00:47:29,455 --> 00:47:31,455
then we had Bitcoin Season 2,

846
00:47:31,455 --> 00:47:35,455
and then people got slightly more open-minded.

847
00:47:35,455 --> 00:47:37,455
So I hope that's a trend that continues.

848
00:47:37,455 --> 00:47:39,455
Ideally, today we would just run the guillotine

849
00:47:39,455 --> 00:47:41,455
and never talk about Lightning again.

850
00:47:41,455 --> 00:47:43,455
And then we would only talk about the other L2s.

851
00:47:43,455 --> 00:47:45,455
That would be what I would prefer.

852
00:47:45,455 --> 00:47:47,455
And also I think it's unfair to imagine that

853
00:47:47,455 --> 00:47:50,455
Lightning is like ossified or won't improve,

854
00:47:50,455 --> 00:47:52,455
like the topic that I wrote on the board is multi-party channels.

855
00:47:52,455 --> 00:47:54,455
But it's not about it won't improve.

856
00:47:54,455 --> 00:47:56,455
It's about the fundamental use of L1 bytes

857
00:47:56,455 --> 00:47:58,455
and the lack of paying to miners.

858
00:47:58,455 --> 00:48:00,455
And these are fundamental.

859
00:48:00,455 --> 00:48:02,455
Paying to miners, sure, I'll give you that.

860
00:48:02,455 --> 00:48:05,455
But like when you talk about the 8 billion people

861
00:48:05,455 --> 00:48:08,455
and divide down how many transactions they need on-chain,

862
00:48:08,455 --> 00:48:10,455
you're assuming two-party channels with that.

863
00:48:10,455 --> 00:48:12,455
But if we have LN symmetry,

864
00:48:12,455 --> 00:48:14,455
then those two-party channels turn into 10-party channels.

865
00:48:14,455 --> 00:48:16,455
Now you've got to do your math again.

866
00:48:16,455 --> 00:48:18,455
That's the channel factories idea

867
00:48:18,455 --> 00:48:21,455
that I talked about in the presentation

868
00:48:21,455 --> 00:48:24,455
on the post from 2022, which is February.

869
00:48:24,455 --> 00:48:26,455
And that idea doesn't work

870
00:48:26,455 --> 00:48:28,455
because if you have one saboteur joins,

871
00:48:28,455 --> 00:48:31,455
he can just go AWOL or just do nothing.

872
00:48:31,455 --> 00:48:34,455
And you either have to join by giving him money

873
00:48:34,455 --> 00:48:37,455
or he has to join using L1 bytes with his own Bitcoin

874
00:48:37,455 --> 00:48:40,455
or you have to give him a slot for free,

875
00:48:40,455 --> 00:48:42,455
in which case he can just attack

876
00:48:42,455 --> 00:48:44,455
an unlimited number of channels for free.

877
00:48:44,455 --> 00:48:46,455
So there's these unsolved problems,

878
00:48:46,455 --> 00:48:48,455
but Lightning Network can still improve.

879
00:48:48,455 --> 00:48:50,455
And the thing is we have all these implementations

880
00:48:50,455 --> 00:48:52,455
and applications already that do Lightning

881
00:48:52,455 --> 00:48:54,455
based on this base protocol,

882
00:48:54,455 --> 00:48:56,455
which has been designed from the very beginning

883
00:48:56,455 --> 00:48:58,455
to be flexible and extensible.

884
00:48:58,455 --> 00:49:00,455
And so there's room for it to grow

885
00:49:00,455 --> 00:49:02,455
and people are ready to adopt new bolts.

886
00:49:02,455 --> 00:49:04,455
I hear what you're saying,

887
00:49:04,455 --> 00:49:06,455
but sometimes it gets to the driverless Waymo thing

888
00:49:06,455 --> 00:49:08,455
where I just think,

889
00:49:08,455 --> 00:49:10,455
this person has an emotional investment in Lightning.

890
00:49:10,455 --> 00:49:12,455
They just said moments ago,

891
00:49:12,455 --> 00:49:14,455
I agree there are fundamental problems,

892
00:49:14,455 --> 00:49:16,455
but maybe one day it'll work.

893
00:49:16,455 --> 00:49:18,455
And then custodial, I think it's also kind of a straw man

894
00:49:18,455 --> 00:49:20,455
because we already have issues with people

895
00:49:20,455 --> 00:49:22,455
with custodial Bitcoin and L1.

896
00:49:22,455 --> 00:49:24,455
Decentralization is hard.

897
00:49:24,455 --> 00:49:26,455
Humans will favor convenience.

898
00:49:26,455 --> 00:49:28,455
The other gentleman with the sunglasses

899
00:49:28,455 --> 00:49:30,455
just made about

900
00:49:30,455 --> 00:49:32,455
we have to try to improve.

901
00:49:32,455 --> 00:49:34,455
The way I see it is

902
00:49:34,455 --> 00:49:36,455
you have the scoreboard is

903
00:49:36,455 --> 00:49:38,455
what is everyone using to transact?

904
00:49:38,455 --> 00:49:40,455
And the way I see it, Visa and Venmo

905
00:49:40,455 --> 00:49:42,455
and Cash and everything, those are on the board

906
00:49:42,455 --> 00:49:44,455
next to Lightning.

907
00:49:44,455 --> 00:49:46,455
So Lightning is losing by a billion

908
00:49:46,455 --> 00:49:48,455
x.

909
00:49:48,455 --> 00:49:50,455
And so I agree

910
00:49:50,455 --> 00:49:52,455
that we don't want custodial payments.

911
00:49:52,455 --> 00:49:54,455
Custodial payments means someone else

912
00:49:54,455 --> 00:49:56,455
has your Bitcoin and you have no recourse

913
00:49:56,455 --> 00:49:58,455
to get it back other than

914
00:49:58,455 --> 00:50:00,455
their opinion of you or their brand or something.

915
00:50:00,455 --> 00:50:01,005
The trust.

916
00:50:01,005 --> 00:50:14,005
So I completely agree that that's what we don't want. The fact that in practice,
when people use Lightning, it is custodial, that is further evidence of it not
having the right product market fit. I think it's just...

917
00:50:14,005 --> 00:50:36,005
Here's my closing. There's a crisis around the world about quantum computing right
now. And if you look at what a quantum computer can do in 2025, they have this huge
fucking factory with tons of electricity and this weird freezer that gets down to
five Kelvin and all these external computers that reduce the noise and tons of
algorithms and blah, blah, blah, blah, blah, blah, blah. They got 100 qubits in
there. Like, give up. You're never going to make, you're never going to break Shor's
algorithm with that, right?

918
00:50:36,005 --> 00:51:01,005
No, I'm not saying that we should just give up on all invention. Again, this is a
driverless Waymo point. I'm not saying we should give up on driverless cars. I'm
saying this thing you're in is not a driverless car. And the people who are saying
that it is, they have an emotional buy into the idea and they have to just grieve
and mourn the idea on their own time before they finally come to terms with what Taz
Driver was trying to say in 2019 on what Bitcoin did.

919
00:51:01,005 --> 00:51:11,005
And that's, you know, the reality. And the reality is I'm either too honest or too
artistic or whatever to just deal with all this crazy emotional baggage that
everyone's been throwing.

920
00:51:11,005 --> 00:51:34,005
I do want to say, real quick, I do want to say that the feedback I'm getting might
not 100% agree with you, but we have some people that haven't said anything yet. So,
yeah, real quick. And if you can make it a point, what do you disagree with? What do
you want to ask a question about? And then get off stage.

921
00:51:35,005 --> 00:51:40,005
How about now? There we go.

922
00:51:41,005 --> 00:52:07,005
Hi, Paul. I am not an expert on Lightning. I am very much a neutral party in this
whole debate. I guess I have two questions for you. I'll ask one you can answer,
then I'll ask the other. So the first, I love your perspective on UTXO and how in
the future it could potentially allow us to expand the UTXO set and how that might
affect your answer regarding Lightning. And I'll ask the second question after.

923
00:52:08,005 --> 00:52:21,005
Yeah, actually, it's the same thing. I hate to say it again, Taj, but I really,
really liked it at first. I loved it so much. And then eventually I decided that
it's not actually that good. But UTXO is a really, really cool idea.

924
00:52:22,005 --> 00:52:37,005
But the problem with it, Taj, I think, is that ultimately you're either serving all
the blockchain data. It's the data availability problem. You're either a full node
and you're willing to stand behind the whole blockchain as something that you have
and that's accurate. Or you're not.

925
00:52:37,005 --> 00:52:50,005
And so the idea of the mobile phone being a full node but it's saving on hard drive
space, it's kind of like either you're the full node with all the data or you're
something else and we already have SPV. And so I don't think...

926
00:52:50,005 --> 00:53:13,005
I really liked it at first and I built it into the L2 that I had, the BIP300 L2 demo
that did the 8 billion transactions. So it's in that demo, that simulation I used
for 8 billion users. UTXO is in it. But actually, as I grew more familiar with it, I
think it doesn't really actually add that much. We actually need all the fraud
proofs.

927
00:53:13,005 --> 00:53:27,005
Cool, thanks. Second question is basically about trade-offs. Different L2 proposal
systems all are going to have potentially different trade-offs. That's why today in
the fiat system we have different payment systems for different uses.

928
00:53:27,005 --> 00:53:48,005
Lightning has some interesting properties, namely regarding the ability to have
basically instant finality with very high degree of... very low trust assumptions
because you're basically as close as you can get to the instant finality that's
trustless. Do you think you can replicate that with a different L2 approach?

929
00:53:48,005 --> 00:54:11,005
Yes. And that's a very good point. And when Lightning works, it does have this kind
of unique and surprising thing where it's instant settlement. So that's very cool. I
think in practice it's not as useful in most cases because in many... for example,
if you buy something on Amazon, they can just wait for a confirmation. So they
don't... zero-conf is really not needed most of the time.

930
00:54:12,005 --> 00:54:32,005
If you later bounce the transaction out or something, they can just cancel it,
cancel your order and just not ship it to you. So there's only a few cases where it
actually helps a lot to... there's only a few cases where it helps a lot to have the
instant settlement. And I think that it's kind of overblown.

931
00:54:33,005 --> 00:54:59,005
The way you would get it on a different L2 is you'd have some kind of like bond
thing where you'd say like, okay, I'm putting $200 of cash in this zone where if I
ever sign two transactions, you can slash that and destroy it. And then if...
anytime you make a payment less than $200, the merchant would have a lot of
assurance that you will not sign a conflicting. So it is possible to try to
replicate that advantage in the other L2s, I think. But I also think it's also not
that necessary.

932
00:54:59,005 --> 00:55:11,005
Quick recommendation. Less theorizing and debating and educating and more what do we
disagree with or what do we want to take away from this? I know you just got on,
but...

933
00:55:12,005 --> 00:55:29,005
All right. I'll try to be concise here. But thanks, Paul, for doing this. And I
actually appreciate your commentary on Lightning because Lightning is a big pain in
the ass and especially self-custodial Lightning is a big challenge. So we need to be
forthright about that.

934
00:55:29,005 --> 00:55:45,005
And I think Lightning when it first came on board was a little bit falsely
advertised. So I agree with that. But frankly also so is Bitcoin in a way. It takes
people a long time to understand Bitcoin and self-custodial Bitcoin is a pain in the
ass as well. And most people don't do that.

935
00:55:46,005 --> 00:55:59,005
And Lightning is suitable right now for business-to-business and hopefully more
peer-to-peer transactions, but you can hardly say that custodial Bitcoin has not
been useful for HODLers over the past 10 years.

936
00:55:59,005 --> 00:56:09,005
And Bitcoin's capabilities of being able to launch several exchanges in different
countries is similar to Lightning, allowing developers to get up and started with a
payments business very quickly.

937
00:56:09,005 --> 00:56:12,005
So I just wanted to finish with a brief quotation.

938
00:56:12,005 --> 00:56:22,005
The Nirvana fallacy is a logical fallacy where someone rejects a realistic or
practical solution because it's not, quote, perfect.

939
00:56:22,005 --> 00:56:32,005
Instead of weighing real-world trade-offs, the person compares the proposal to an
idealized, flawless alternative that doesn't actually exist. Thank you.

940
00:56:32,005 --> 00:56:40,005
I think it's fair, but it's incorrect. I don't compare it to a flawless alternative.
As I said, I have a simulation of something else that already works for me.

941
00:56:40,005 --> 00:56:43,005
So your response to that is Drivechain?

942
00:56:43,005 --> 00:56:51,005
No, it's not. Although it is the case that that's part of the reason why I am even
more skeptical on Lightning.

943
00:56:51,005 --> 00:56:56,005
I'm like, well, this is another thing right here that doesn't have all this long
list of problems.

944
00:56:57,005 --> 00:57:06,005
I didn't compare it to a perfect thing or say that it has to be perfect. I said it
has to work for a large number of people.

945
00:57:06,005 --> 00:57:21,005
So similarly to me dragging you to Atlanta, I dragged Taj on stage. Thank you.

946
00:57:21,005 --> 00:57:29,005
I would ask if both of you could make concise points and then get off stage, I would
appreciate it.

947
00:57:29,005 --> 00:57:33,005
Yeah, I actually had a rhetorical question for Paul.

948
00:57:33,005 --> 00:57:40,005
Paul, Lightning Network's been around for a while. Do you know what the current
network capacity is?

949
00:57:40,005 --> 00:57:46,005
The number of coins on the network? I used to quote this all the time because I
thought it was so low. I couldn't believe how low it was.

950
00:57:46,005 --> 00:57:48,005
But I think now it's something like 3,900 coins?

951
00:57:48,005 --> 00:57:56,005
It's around 4,000 according to 1ml.com. My follow-up question is how much WBTC is
there currently?

952
00:57:56,005 --> 00:58:02,005
I had this on the L2L slide that people wanted me to cut. I had this number. It was
like 140,000.

953
00:58:02,005 --> 00:58:11,005
It's 127,000. So I'm not good at math, but I think that's 30x or so. What are your
thoughts?

954
00:58:11,005 --> 00:58:19,005
That is a perfect demonstration. I had that on the slide that I used to say, this is
what people actually want.

955
00:58:19,005 --> 00:58:31,005
It's something else. But even when I did the simulation, on each of the 14 L2s, you
only end up with between 5,000 and 10,000 BTC on the L2.

956
00:58:31,005 --> 00:58:38,005
So even though for years I was amazed that it was so low, it's actually even my own
simulation contradicted what I had learned to some extent.

957
00:58:38,005 --> 00:58:46,005
Because there's 14 of these. So I was only at one order of magnitude or so.

958
00:58:46,005 --> 00:58:52,005
So no more panelists. This is going to be the closing here. I'm changing it. You
two.

959
00:58:52,005 --> 00:59:05,005
We'll leave that maybe for a fireside chat. But both points and then we'll do what
Taj really wanted this whole time, obviously.

960
00:59:05,005 --> 00:59:19,005
All right. Can I throw this in here real quick? So you have this Waymo idea, and
I've been working on something that in a way effectively is a self-drive system for
the Waymo.

961
00:59:19,005 --> 00:59:23,005
If that solves the problem, would you help me work on it?

962
00:59:23,005 --> 00:59:30,005
Yeah, I will work on it. I will shill anything that I think is a good idea and
criticize anything that I think is a bad idea.

963
00:59:30,005 --> 00:59:41,005
But I feel like, again, it's being reduced to this popularity contest or something.
These are just the facts. I don't know what to say. Sorry.

964
00:59:41,005 --> 00:59:44,005
Don't we all just want 8 billion Bitcoin or so?

965
00:59:44,005 --> 00:59:54,005
Well, I think if you design something that won't work and then someone else designs
something that will work for 8 billion, then it's on borrowed time.

966
00:59:54,005 --> 00:59:57,005
I agree.

967
00:59:57,005 --> 01:00:02,005
You have to be on top of the state of the art. It's mandatory.

968
01:00:02,005 --> 01:00:11,005
This might sound a little cliche, but I just wanted someone to say it on the stage
that I don't think I'm the only one appreciating your perspective.

969
01:00:11,005 --> 01:00:26,005
I think you might have the biggest crowd here. And I'm just happy that we're not
marinating ourselves in our optimism all the time in our own farts and must be
really uncomfortable to be on a stage with most people probably disagreeing at least
slightly.

970
01:00:26,005 --> 01:00:29,005
But I think it's very valuable.

971
01:00:29,005 --> 01:00:34,005
Okay, thank you. Thanks very much.

972
01:00:34,005 --> 01:00:37,005
I'm just going to come up and hang out.

973
01:00:37,005 --> 01:00:41,005
But then when you started talking about UtrexO, I'm like, no, wait.

974
01:00:41,005 --> 01:00:48,005
UtrexO I like because it hasn't gotten controversial because people don't really
know about it. And I think it's like there's no software involved.

975
01:00:48,005 --> 01:00:56,005
And that's like very much still in progress. And I don't promise it will allow
people to run full nodes on phones very easily because there's still all the CPU
work.

976
01:00:56,005 --> 01:01:00,005
But like that one, I think there's a lot of cool stuff in there.

977
01:01:00,005 --> 01:01:05,005
What I did want to say is the thing that so there's there's one like, I think it's
not a waste of time to work on lightning.

978
01:01:05,005 --> 01:01:10,005
I think lightning is cool. Yes. All these things. But there's a lot. So there's a
bunch of things.

979
01:01:10,005 --> 01:01:12,005
I was like, wait, no, wait, no, I'm not going to go through all of them.

980
01:01:12,005 --> 01:01:18,005
But there was also something that struck me. It was like there are a bunch of
totally legitimate criticisms.

981
01:01:18,005 --> 01:01:22,005
Right. And like, yes, lightning has to some extent been oversold and all these
things.

982
01:01:22,005 --> 01:01:26,005
But a lot of this stuff you're saying, it's like, wait, this is just Bitcoin. Right.

983
01:01:26,005 --> 01:01:30,005
Like so so many of these problems apply to Bitcoin in general.

984
01:01:30,005 --> 01:01:37,005
And it's not like, yeah, this is a problem in lightning. And there's way more
because, you know, people want to do custodial lightning and sort of these fake
things.

985
01:01:37,005 --> 01:01:45,005
But that's just everywhere in Bitcoin and like usability. So like I paid for the
ticket to TabConf using Bitcoin.

986
01:01:45,005 --> 01:01:49,005
And geez, it took me like three hours. I believe you made him pay for a ticket.

987
01:01:49,005 --> 01:01:58,005
No, everyone pay. Right. Did you. Oh, OK. I don't know. But everyone at TabConf is a
speaker.

988
01:01:58,005 --> 01:02:01,005
So please, everyone buy a ticket for next year. Even if you are a speaker, it helps.

989
01:02:01,005 --> 01:02:08,005
But it's like you got to pay Bitcoin. Come on, it's TabConf. And then I like it took
me three something hours and I got it to work.

990
01:02:08,005 --> 01:02:15,005
But it was just like and it was sort of like a depressing. I'm like, man, I've been
working on Bitcoin for like, you know, 13, 14 years.

991
01:02:15,005 --> 01:02:20,005
And it's just like, are we getting there? And like to some extent lightning as well.

992
01:02:20,005 --> 01:02:26,005
But it's just even on chain, it's just like it's so hard. And the incentives to like
the companies.

993
01:02:26,005 --> 01:02:33,005
I've worked at different companies and like the incentive isn't necessarily we want
to make everything easy for the end user who will never pay us or never.

994
01:02:33,005 --> 01:02:39,005
We never know who they are and stuff. Most companies are like, no, we want to like
capture some of that value.

995
01:02:39,005 --> 01:02:43,005
So, yeah, like there are these problems and they extend to Bitcoin as well.

996
01:02:43,005 --> 01:02:47,005
I don't think you can just say these are lightning problems. These are like general
problems.

997
01:02:47,005 --> 01:03:01,005
I would definitely agree that like a Bitcoin company or even a like lightning
company is a little bit of a contradiction because we want there to be like a public
like code based, math based thing that has no identities and has at least Cypherpunk
properties.

998
01:03:01,005 --> 01:03:06,005
And then as soon as you form a company, you have a mailing address, you have
shareholders or whatever.

999
01:03:06,005 --> 01:03:11,005
Now you're plugged into the fiat world 100 percent. So I think there's an inherent
tension.

1000
01:03:11,005 --> 01:03:19,005
I completely agree. I did the flights with on chain with Electrum and with the
stupid BitPay. They still won't kill this. This is like the worst idea ever.

1001
01:03:19,005 --> 01:03:24,005
And I used to tell people, people come to me and like ask like where this should
work. And I tell them work at BitPay.

1002
01:03:24,005 --> 01:03:31,005
And then they'd say, I hate this thing. And they're so right. And it never works.
And you have to use the D BitPay. And then I even ranted about it on Twitter.

1003
01:03:31,005 --> 01:03:38,005
Real quick, BitPay, the lovely Atlanta based company that we are, you know, we love
and cherish.

1004
01:03:39,005 --> 01:03:41,005
I will pour it into BitPay and disappoint it.

1005
01:03:41,005 --> 01:03:42,005
Well, they're not sponsoring this year.

1006
01:03:42,005 --> 01:03:45,005
How can that possibly be like a D BitPay? How could that ever exist?

1007
01:03:45,005 --> 01:03:49,005
Hey Paul, real quick. We're at time. Real quick.

1008
01:03:49,005 --> 01:04:07,005
I have to ask Tash if he fundamentally disagrees with my characterization of the
channels, the consumption of the L1 bytes fundamentally marring the idea and making
it like harder to make it uncompetitive compared to something that does not have
that.

1009
01:04:08,005 --> 01:04:12,005
Drawback. That's my, that's like the core of my technical argument.

1010
01:04:12,005 --> 01:04:17,005
So I have to, since I would have never have dragged you on stage like this. Mike did
that.

1011
01:04:17,005 --> 01:04:21,005
But since you're up here, I wouldn't be doing my job if I didn't ask that question.

1012
01:04:21,005 --> 01:04:26,005
This is not new. Like in the end of the Lightning Network paper, it's like, okay,
yeah, like here's the back of the envelope.

1013
01:04:26,005 --> 01:04:29,005
Like you'd need 300 megabyte blocks and then everyone could open a channel every
year or something.

1014
01:04:29,005 --> 01:04:36,005
So like, yes, but yeah, but so these, these numbers are, you know, in the Lightning
Network paper, it's like, yeah.

1015
01:04:36,005 --> 01:04:37,005
You need around 300.

1016
01:04:37,005 --> 01:04:39,005
The L1 bytes are very important.

1017
01:04:39,005 --> 01:04:45,005
But, but at the same time, like there are these, there are huge trade-offs, right?

1018
01:04:45,005 --> 01:04:49,005
If you're like, oh, we can use ARC. It's the same thing. It's like, well, no, they
work totally differently.

1019
01:04:49,005 --> 01:04:53,005
And so that's, I think Lightning definitely still has a place.

1020
01:04:53,005 --> 01:05:03,005
And one of the reasons I work on Utrecht XO is like, well, maybe we can't, you know,
everyone stopped talking about this eight years ago, but like maybe we can actually
have increased L1 capacity as well.

1021
01:05:04,005 --> 01:05:09,005
And maybe if we have better technology, you can still run a crummy Raspberry Pi and
have like 10 megabyte blocks or something.

1022
01:05:09,005 --> 01:05:10,005
I don't know.

1023
01:05:10,005 --> 01:05:18,005
So like working on those technologies as well to then use Lightning as sort of this,
you know, force multiplier and like, hey, maybe it helps 10X or something.

1024
01:05:18,005 --> 01:05:21,005
But yeah, it's not the only solution.

1025
01:05:21,005 --> 01:05:28,005
So, but yeah, I guess my main thing is like, yes, there's problems in Lightning, but
like so many of these are like everywhere in Bitcoin.

1026
01:05:28,005 --> 01:05:32,005
And it is sort of like, are we making the progress we need to?

1027
01:05:32,005 --> 01:05:35,005
Because you just online you see like treasury companies and all these custodial
things.

1028
01:05:35,005 --> 01:05:37,005
It's like, yeah, that's that's scary.

1029
01:05:37,005 --> 01:05:38,005
I agree.

1030
01:05:38,005 --> 01:05:44,005
We need the best ideas to win because the custodial idea is always there lurking in
the background.

1031
01:05:44,005 --> 01:05:47,005
And that is 100 percent accurate.

1032
01:05:47,005 --> 01:05:49,005
Well, we are at time.

1033
01:05:49,005 --> 01:05:50,005
Thank you.

1034
01:05:50,005 --> 01:05:51,005
Thanks, everyone.

1035
01:05:51,005 --> 01:05:52,005
Thank you.

1036
01:05:52,005 --> 01:05:55,005
Paul, if I could.

1037
01:05:55,005 --> 01:05:57,005
Paul, I want to say something real quick.

1038
01:05:57,005 --> 01:05:59,005
So TapConf Builders Conference.

1039
01:05:59,005 --> 01:06:02,005
I know you're working on your layer two.

1040
01:06:02,005 --> 01:06:03,005
You're over here.

1041
01:06:03,005 --> 01:06:04,005
Shit talking lightning.

1042
01:06:04,005 --> 01:06:06,005
You're building a solution.

1043
01:06:06,005 --> 01:06:08,005
You're not just complaining, but you're also building.

1044
01:06:08,005 --> 01:06:19,005
And what I'm really excited about is that becoming mature and you coming back to
TapConf and helping make it easy for builders to check out what you're working on
for years to come.

1045
01:06:19,005 --> 01:06:22,005
So we'll all be part of the solution here, right?

1046
01:06:22,005 --> 01:06:25,005
It's like it's already finished, basically.

1047
01:06:25,005 --> 01:06:29,005
Well, where's where's the where's the builder table to help on board developers?

1048
01:06:29,005 --> 01:06:31,005
Where's the.

1049
01:06:31,005 --> 01:06:32,005
All right, well, thank you.