1 00:00:00,000 --> 00:00:06,800 Complacency and overconfidence has started to ruin the project. If they make it clear that, like, 2 00:00:06,800 --> 00:00:12,480 there's no way forward with BTC, it's possible that, you know, a lot of other stuff is just, 3 00:00:12,480 --> 00:00:16,960 like, hanging by a thread and it's not, it's just held together with scotch tape or something. 4 00:00:17,600 --> 00:00:23,120 The inability to scale Bitcoin or just neglect of the users and the user experience and saying 5 00:00:23,120 --> 00:00:28,400 this is just a ticker symbol that you just buy, I don't know if we will survive that. 6 00:00:29,280 --> 00:00:34,080 You know, I don't see where we would go from here other than to introduce a new coin. 7 00:00:34,080 --> 00:00:35,120 Are you still a Bitcoiner? 8 00:00:37,600 --> 00:00:42,960 Paul Sztorc, you're one of the most tenured contributors to Bitcoin. You've been working 9 00:00:42,960 --> 00:00:49,120 on the Drivechain's proposal to upgrade the network for over a decade. Today, 10 00:00:49,120 --> 00:00:55,840 you're announcing you're hard-forking Bitcoin, creating your own chain, creating your own coin. 11 00:00:55,840 --> 00:00:56,400 Why? 12 00:00:56,400 --> 00:01:00,480 Well, I just think, like, there's nowhere else to go at this point, like, inside of 13 00:01:01,200 --> 00:01:09,280 BTC. I think, you know, we may not need the new hard-fork coin, but I think it's a good hedge 14 00:01:09,280 --> 00:01:13,120 against, you know, what I call the derangements of Bitcoin. 15 00:01:13,120 --> 00:01:17,120 Unpack that for us. What do you feel like led to this moment, 16 00:01:17,120 --> 00:01:19,760 both for you personally and for the project? 17 00:01:19,760 --> 00:01:23,760 Well, OK, unpacking that, like, I have an article that I call The Derangements of Bitcoin, 18 00:01:23,760 --> 00:01:28,880 and that is about, it's a long list of mistaken beliefs that people have, 19 00:01:29,520 --> 00:01:36,080 or just weird mistakes that the Bitcoin community is making, kind of like for no reason. These 20 00:01:36,080 --> 00:01:41,680 include, like, putting so much time and attention to the Lightning Network and, you know, our 21 00:01:41,680 --> 00:01:49,280 inability to do soft fork upgrades. You know, it includes, there's a whole long list, but it's 22 00:01:49,280 --> 00:01:57,280 like, why is there still no BIP39 word list in Bitcoin Core wallet? None of that makes any 23 00:01:57,280 --> 00:02:02,160 sense. So we have to have a separate BDK project. Why don't people care more about Eric Voskil's 24 00:02:02,800 --> 00:02:09,280 version of Bitcoin, which is, like, 20 times faster? It's a long list of things. 25 00:02:09,280 --> 00:02:13,920 So that's what I mean by the derangements. You know, what led to this point, honestly, 26 00:02:14,160 --> 00:02:19,680 I've considered this for a very long time, even back in 2015. I was thinking, like, 27 00:02:19,680 --> 00:02:23,360 during the scaling war, it was like, it didn't really seem as though either side 28 00:02:24,080 --> 00:02:28,880 had, like, a permanent solution to what to do in the case of these disputes. 29 00:02:30,400 --> 00:02:36,640 So I've kind of always wondered about, you know, what, do we need, like, a plan B for Bitcoin 30 00:02:36,640 --> 00:02:45,520 plan B? And what would that look like? I think that, really, we've had a few, 31 00:02:46,720 --> 00:02:53,360 there have been a few events over the last couple of years that, if they make it clear that, like, 32 00:02:53,360 --> 00:03:00,240 there's no way forward with BTC, one is OP_CAT, which is just 13 lines of code. And it's very, 33 00:03:00,240 --> 00:03:06,160 very simple. And it was in the original version of Bitcoin. And it would be very useful. And as 34 00:03:07,040 --> 00:03:16,400 an opcode soft fork, it's opt-in, ignorable and reversible. So it seemed to present essentially 35 00:03:16,400 --> 00:03:22,080 zero risk. And yet, you know, there's no way of getting that into Bitcoin. 36 00:03:23,360 --> 00:03:29,520 From a development point of view, I do think we're at a point where people are starting to realize 37 00:03:29,520 --> 00:03:33,520 that, you know, Lightning doesn't work, for example, which is one of the biggest sacred 38 00:03:33,520 --> 00:03:40,000 cows of them all. We, you know, we're at a point where people have noticed that the 39 00:03:40,640 --> 00:03:45,520 blocks are, you know, nearly empty, or the, you know, the fee rates are very low. So even if the 40 00:03:45,520 --> 00:03:51,040 blocks are filled up, we don't know if these are diehard users or just people taking advantage of 41 00:03:51,040 --> 00:03:58,880 the free space. Mining revenues are down, the miners are abandoning Bitcoin for AI, 42 00:03:59,520 --> 00:04:05,520 data centers type things. Development is also not great. And even on the investing side, 43 00:04:06,320 --> 00:04:13,360 BTC is not up that much. You have people like Michael Saylor, their lifetime ROI is basically 44 00:04:13,360 --> 00:04:24,000 zero. So I think people are slowly realizing that there is a kind of irrationality to the 45 00:04:24,000 --> 00:04:32,720 community, unfortunately. So I think a new competitor can not only have a shot at succeeding 46 00:04:32,720 --> 00:04:39,040 now, but also it can maybe inspire BTC to like, get its act together. 47 00:04:39,040 --> 00:04:42,080 Are you forking because you think Bitcoin has failed? 48 00:04:42,080 --> 00:04:47,040 Well, it certainly hasn't failed yet. But you got to keep in mind like where the puck is going, 49 00:04:47,040 --> 00:04:53,200 so to speak. And I think that if you lose a culture of truth, like where the people in your 50 00:04:53,200 --> 00:05:00,720 community really care about what's true and they don't allow a bunch of false statements to be made 51 00:05:01,440 --> 00:05:07,440 and they have to care about the truth and look for the truth. I think if you lose that in your 52 00:05:07,440 --> 00:05:12,000 community, then it's probably only a matter of time before you get replaced by a different 53 00:05:12,000 --> 00:05:16,480 community that has a better culture of truth. And then, yeah, when you see people talk about 54 00:05:16,480 --> 00:05:22,640 the Lightning Network or even the treasury companies or a hundred other things, it really 55 00:05:23,280 --> 00:05:26,640 it's very different than the way it was back in 2014. 56 00:05:27,360 --> 00:05:31,840 There are going to be folks who hear this. They are going in a different direction with 57 00:05:31,840 --> 00:05:36,480 LayerTwo Labs. They are pursuing the fork. They're not going to be happy. They're going to hear that 58 00:05:36,480 --> 00:05:41,520 you're going to be out there competing with Bitcoin and potentially profiting from that 59 00:05:41,520 --> 00:05:45,040 by creating the coin. Your response to them? 60 00:05:45,040 --> 00:05:49,360 Well, I think competition is a very healthy thing for everyone. It brings out the best. 61 00:05:49,360 --> 00:05:51,600 I'm a huge believer in competition. I think that's why 62 00:05:52,960 --> 00:05:56,720 capitalism, you know, all the good things about capitalism, I think, come from competition. 63 00:05:57,680 --> 00:06:02,400 Probably all the good things about democracy, if to whatever extent there are some things, 64 00:06:02,400 --> 00:06:06,800 those come from the competition between the two parties and the candidates for 65 00:06:06,800 --> 00:06:12,080 persuading people and getting their vote. Competition is how you have, you know, 66 00:06:12,080 --> 00:06:16,160 is why even open sources run like a kind of weird communist thing where, you know, 67 00:06:16,160 --> 00:06:20,960 people aren't paid for commits and they just contribute. But I think it's the idea that 68 00:06:20,960 --> 00:06:26,240 the different versions of the software, you have V1, V2, V3, they compete with each other. 69 00:06:26,240 --> 00:06:33,040 So I think competition is actually a very good thing. And of course, competition has a few 70 00:06:34,400 --> 00:06:40,480 conflicts of interest where when we go to CVS, we want everyone to be competing for our 71 00:06:41,360 --> 00:06:48,240 for our dollar or for our, you know, to sell us goods and services. But we personally don't like 72 00:06:48,240 --> 00:06:54,960 it as much when people compete with us. So, yeah, I think that it's fair to, you know, 73 00:06:54,960 --> 00:07:02,080 not like this to some extent. But I think also we have to keep in mind to what extent the 74 00:07:02,080 --> 00:07:08,160 complacency and overconfidence has started to ruin the project. 75 00:07:08,560 --> 00:07:16,720 There are certain things like the inability to scale Bitcoin or just neglected the users 76 00:07:16,720 --> 00:07:20,480 and the user experience and saying this is just a ticker symbol that you just buy. 77 00:07:21,520 --> 00:07:28,560 I don't know if we will survive that attitude. So I think, you know, we had better get on it 78 00:07:28,560 --> 00:07:33,280 earlier. If I'm right, we should get on it earlier rather than later and have a serious 79 00:07:33,280 --> 00:07:39,760 conversation about all these issues. We mentioned there's a history to this project 80 00:07:39,760 --> 00:07:46,640 dating back to 2014, 2015. Why now? Well, you know, at first I've always had this Drivechain 81 00:07:46,640 --> 00:07:50,960 idea and, you know, it's always been a pretty good idea. And in fact, the community back in 82 00:07:50,960 --> 00:07:56,880 2013 through 2015, that type of era, back then the Bitcoin community was very interested in 83 00:07:56,880 --> 00:08:01,120 sidechains. And someone used, I don't remember who, but someone used like the phrase Holy Grail 84 00:08:01,120 --> 00:08:07,440 at one point. And there was that famous tweet from Brian Armstrong where he said like Litecoin 85 00:08:07,440 --> 00:08:12,000 and Ripple and whatever, these are just a distraction. The real thing we need to focus 86 00:08:12,000 --> 00:08:18,240 on is Bitcoin and sidechain. So that's how different the era was. And then remember Blockstream raised 87 00:08:18,240 --> 00:08:22,080 all this money to do sidechains. And then Gavin Andreessen had a tweet and he was like, if this 88 00:08:22,080 --> 00:08:27,280 amazing company offers you a job, you know, you take it or something. So that was a very different 89 00:08:27,280 --> 00:08:32,720 era back then. And I was always interested in the sidechain idea. I kind of thought that, you know, 90 00:08:32,720 --> 00:08:37,120 let's see these other ideas and see how they work out. So I was like, well, maybe everyone's very 91 00:08:37,120 --> 00:08:42,960 gung ho about the Lightning Network. I was also optimistic about it in 2015. I was sort of hacking 92 00:08:42,960 --> 00:08:51,520 on it myself. And so I was thinking like, well, maybe this will work out. And of course, the BTC 93 00:08:51,520 --> 00:08:56,080 price has gone up and up and up and Bitcoin has had enormous success and it has changed the world 94 00:08:57,040 --> 00:09:03,760 a lot already. You know, we managed to get a presidential candidate to speak at the 95 00:09:04,640 --> 00:09:13,200 national conference. We managed to free Ross Ulbricht. So we made a lot of stuff happen. 96 00:09:13,200 --> 00:09:20,720 We really changed the world and the price went up enormously. Yeah. And I came even like other 97 00:09:20,720 --> 00:09:26,480 ideas like I thought, you know, Roger Ver really wanted to try Bitcoin Cash and whatever. So I was 98 00:09:26,480 --> 00:09:31,280 like, oh, well, let's just see how this all plays out. And a lot of it has played out very well. But 99 00:09:31,280 --> 00:09:35,680 I just think from here, where do we go? Do we just keep waiting around? And, you know, so do we just 100 00:09:35,680 --> 00:09:43,040 have more custodial lightning and more treasury companies and like and then what? Like we just 101 00:09:43,040 --> 00:09:47,680 keep talking about people keep proposing new BIPs, but we never activate any soft forks. And, 102 00:09:48,640 --> 00:09:52,720 you know, I don't I don't see where where we would go from here other than to introduce a new 103 00:09:52,720 --> 00:09:58,160 coin. What's your ask for Bitcoin hodlers? Right. To the extent that there is resistance to change. 104 00:09:58,160 --> 00:10:02,080 A lot of that is Bitcoiners don't like change, right? They like holding their keys. They like 105 00:10:02,080 --> 00:10:09,200 knowing that their Bitcoin is going to be there for the long run. What does the ETH Cash project 106 00:10:09,200 --> 00:10:14,240 offer them in your view? You know, that's a very good question, because actually I think it offers 107 00:10:14,400 --> 00:10:20,640 them a lot, because if you think about it, this is the alternative that doesn't change 108 00:10:21,440 --> 00:10:27,760 BTC at all, actually. So I'm giving them exactly what they want instead of pushing for BIP300 on 109 00:10:27,760 --> 00:10:35,440 BTC. This is an alternative where I'm not doing that and now you just have a second thing. You 110 00:10:35,440 --> 00:10:42,880 can sell it for more BTC if you want. I think it would be smart for everyone to wait and hold 111 00:10:42,880 --> 00:10:50,160 both coins. But I think, yeah, if anyone who feels strongly that this is a waste of time, 112 00:10:50,160 --> 00:10:56,160 then you can sell, you can get more BTC. I'm giving everyone free money with the hard fork. I 113 00:10:56,160 --> 00:11:05,760 think, you know, that's a pretty good deal. So you're welcome. And I think, though, that some 114 00:11:05,760 --> 00:11:12,080 people out there should take it upon themselves, like they should ask, you know, could I spend 115 00:11:12,080 --> 00:11:18,640 five or 10 minutes looking into this? And maybe it's worth, you know, your time. If you after 116 00:11:18,640 --> 00:11:23,520 looking into it, you might think, oh, I have a better idea of what this is really about. 117 00:11:24,160 --> 00:11:27,520 Paul, what's the bull case for eCash? 118 00:11:27,520 --> 00:11:31,280 Look, Bitcoin hardware wallets can be hard to use. I've given a version of almost 119 00:11:31,280 --> 00:11:35,280 every single major hardware wallet to friends and family over the years. 120 00:11:35,280 --> 00:11:42,000 My go to, the Trezor Safe 7 Bitcoin only. We're talking great UX, simple onboarding, 121 00:11:42,000 --> 00:11:47,120 minimal buttons in an easy to read screen. And on top of all that, it's free from all the 122 00:11:47,120 --> 00:11:52,960 distractions that we know crypto hardware wallets can bring. So if you want your friends and family 123 00:11:52,960 --> 00:12:00,480 to truly start stacking, try the Trezor Safe 7. Take a 5% discount with the promo code RIZO on me. 124 00:12:00,480 --> 00:12:09,040 There are definitely two ways in which this could be a huge success. 125 00:12:14,240 --> 00:12:15,440 Sorry, can I just do that again? 126 00:12:20,480 --> 00:12:25,600 For some reason the water made it worse. Okay. There are definitely two ways in which 127 00:12:26,080 --> 00:12:32,720 this project could have a big positive impact on Bitcoiners. One is, oh my God, sorry. 128 00:12:35,680 --> 00:12:37,200 I'm not going to make a habit of this, I promise. 129 00:12:37,200 --> 00:13:00,800 Well, it's possible that, oh my God. Okay. All right. Okay. Redo. This is it. I promise. 130 00:13:01,040 --> 00:13:08,000 I think it's definitely possible that the stuff that I've discovered is only the tip of the 131 00:13:08,000 --> 00:13:18,240 iceberg. And actually there's a lot more laziness and corruption and overconfidence in the BTC world 132 00:13:18,240 --> 00:13:25,920 overall, other than just what I have been able to identify. So it's possible that BTC is being 133 00:13:26,080 --> 00:13:31,280 held back by a bunch of irrational nonsense. Who knows what the politics are really like 134 00:13:31,280 --> 00:13:37,040 in Bitcoin Core? Who knows what other stuff has been invented or proposed, but that we would just 135 00:13:37,040 --> 00:13:40,960 never hear about it? Because how would we even hear about it? Someone out there is going to say, 136 00:13:40,960 --> 00:13:50,400 oh, my idea, whatever, chains, is great. And we would never really hear about that in today's 137 00:13:50,800 --> 00:14:01,120 world, because everyone would just be so dismissive. So it's possible that a lot of 138 00:14:01,120 --> 00:14:06,080 other stuff is just like hanging by a thread and it's just held together with scotch tape or 139 00:14:06,080 --> 00:14:10,960 something. So if that's the case, then just the arrival of any new competitor that just doesn't 140 00:14:10,960 --> 00:14:17,200 have all these sort of parasites, I think then that would do really, really well. 141 00:14:21,120 --> 00:14:29,360 It would benefit all of us to learn the true extent of how strong is Bitcoin as a competitor, 142 00:14:29,360 --> 00:14:33,600 really. Because if you think about it, Ethereum is like this weird pre-mined thing from 2015. 143 00:14:33,600 --> 00:14:42,080 It's so different from Bitcoin that they're actually hard to compare. And what actually 144 00:14:42,080 --> 00:14:50,480 really competes with BTC in its niche? I don't know. You could say Bitcoin Cash or something, 145 00:14:50,480 --> 00:14:58,560 but those are old. I don't know. I think that that's a different thing. When you go for the 146 00:14:58,560 --> 00:15:07,280 same name, then I think people have a negative reaction to that and then they make up their 147 00:15:07,280 --> 00:15:13,760 mind and then they don't want to change it back because you fight over the brand. So even the 148 00:15:13,760 --> 00:15:23,520 case of BCH, Bitcoin Cash, I don't know to what extent it competes with BTC. So I think we need a 149 00:15:24,160 --> 00:15:30,240 competitor or two just to figure out even where does BTC actually stand, like how healthy is BTC 150 00:15:30,240 --> 00:15:37,280 really? To an extent, every altcoin or 80-90% of altcoins are forks of the Bitcoin code base. 151 00:15:38,080 --> 00:15:44,320 In that lens, what distinguishes eCash? Well, yeah, I actually want to keep the L1 as close 152 00:15:44,320 --> 00:15:49,360 to Bitcoin Core as possible. I don't even really want there to be any points of comparison. 153 00:15:49,360 --> 00:15:57,040 So the L1 will be the same, but the L2, Bith 300 can be activated without changing any lines of 154 00:15:57,040 --> 00:16:04,640 code in Bitcoin Core. So that's how I plan on activating it on eCash. And then I plan to have 155 00:16:05,680 --> 00:16:11,440 most of the transaction activity and developer activity and in merge mining, the mining activity, 156 00:16:11,440 --> 00:16:19,040 all that should take place on the L2s. The L2s allow multiple different developers or developer 157 00:16:19,040 --> 00:16:24,960 teams to compete. It's my favorite word. And they could all hate each other and they could release 158 00:16:24,960 --> 00:16:31,440 different software. All of these projects would all share the same 21 million coins. 159 00:16:32,800 --> 00:16:38,640 And, you know, so if you really like Bitcoin Core, you just kind of still have that experience on L1. 160 00:16:38,640 --> 00:16:44,240 But if you like other things, if you like privacy, if you like ring signatures or zk-SNARKs, 161 00:16:44,240 --> 00:16:51,920 or if you like the EVM or if you like large block sizes, then you go on to an L2 that has those. 162 00:16:52,480 --> 00:16:59,520 All the L2s are merge mined, so they all contribute to miner revenue. The miner doesn't 163 00:16:59,520 --> 00:17:07,520 even need to do anything. Just automatically collect more money from the chain. So I think 164 00:17:07,520 --> 00:17:13,680 that would be the difference is that, you know, there'd be a lot of working L2s in this world, 165 00:17:13,680 --> 00:17:18,800 whereas in the BTC world, we only have the Lightning Network and it mostly does not. 166 00:17:19,520 --> 00:17:24,400 It does not work, in my opinion. And then I did that debate at TabConf against the entire room 167 00:17:24,400 --> 00:17:29,680 of Lightning developers who mostly agreed with me that it doesn't work. How do you hope the Bitcoin 168 00:17:29,680 --> 00:17:35,360 developers react to the announcement of this project? You have relationships with a lot of 169 00:17:35,360 --> 00:17:41,760 them and you've contributed to the project. I don't know how they will react. I think my 170 00:17:41,760 --> 00:17:47,040 sense is that there's actually a lot of frustration in the BTC developer community. 171 00:17:49,040 --> 00:17:54,800 So I have no idea what they will, they may be relieved. Some of them, I think some of them, 172 00:17:55,360 --> 00:17:59,280 this idea may even like, you know, it has the potential to embarrass them. So they may, 173 00:17:59,280 --> 00:18:04,240 like if this turns out to be a big success, they would be threatened by that. So I don't know how 174 00:18:04,240 --> 00:18:10,960 they will react. I'm not really sure, you know, I think there is in general, there's been an 175 00:18:10,960 --> 00:18:19,360 overemphasis on developers, I think, because in my conception, you have these, you know, 176 00:18:19,360 --> 00:18:29,040 anyone can launch a new L2. So the developers compete. But in most projects, but basically all 177 00:18:29,040 --> 00:18:37,680 of them, the developers of the L1 have an enormous amount of power and influence. And so they kind of 178 00:18:37,680 --> 00:18:45,360 have a little monopoly. So as a result, everyone cares a lot about what they think. And I don't 179 00:18:45,360 --> 00:18:49,760 think we really should care that much about it. What we should care about is getting users who 180 00:18:49,760 --> 00:18:56,560 actually pay transaction fee, and we should have happy users. So I don't know. But you know, the 181 00:18:56,560 --> 00:19:01,520 other thing is, I don't really have that much, I don't have as much respect for Bitcoin developers 182 00:19:01,520 --> 00:19:07,520 today as I did in the past. Because, you know, what have we actually done? We have, you know, 183 00:19:07,520 --> 00:19:12,880 SegWit and Taproot, I think, SegWit is only used because it became like a default. 184 00:19:14,560 --> 00:19:20,000 Taproot, like, people don't, people don't really use like the features that they put out. They 185 00:19:20,000 --> 00:19:25,360 spend all this time to develop something, and then they spend all this time writing tests. 186 00:19:27,120 --> 00:19:31,680 And so I don't really know, like, what, what, it's not like the Bitcoin developers are like 187 00:19:31,680 --> 00:19:37,920 shipping cool new multi-sig features or something. So I don't know, you know, what, what does it even 188 00:19:37,920 --> 00:19:43,600 mean to be a Bitcoin developer these days? It just means that you slowly review code on, 189 00:19:44,720 --> 00:19:50,960 on GitHub. So yeah, I don't know if we should really emulate those people or care a lot about 190 00:19:51,360 --> 00:19:58,400 their opinion anymore. What do you think Satoshi Nakamoto's view of eCash would be if he, 191 00:19:58,400 --> 00:20:04,400 she, they were around today? Well, I think it's interesting that Satoshi was originally very 192 00:20:06,000 --> 00:20:12,320 blasé about new coins, and he helped invent Namecoin, which is the first altcoin. And he 193 00:20:12,320 --> 00:20:17,680 also basically helped invent merge mining in the first place, which is the process by which 194 00:20:18,320 --> 00:20:22,800 miners can mine multiple blockchains at once without doing any extra hashing. 195 00:20:24,960 --> 00:20:28,400 So yeah, and he, he seemed, he, he commented many times about like, 196 00:20:29,760 --> 00:20:33,840 you know, having different chains that have different block sizes and different, and that 197 00:20:33,840 --> 00:20:39,600 the chains that have separate fates. He has, this is his famous quote about piling everything into 198 00:20:39,600 --> 00:20:47,120 one network won't, won't scale. So he interestingly seems to be, he seems to have been 199 00:20:47,120 --> 00:20:51,760 in favor of the concept. Well, he helped invent merge mining. So he was clearly in 200 00:20:53,280 --> 00:20:57,600 pro-merge mining. So he had in mind that there would be these different blockchains. So far, 201 00:20:57,600 --> 00:21:04,480 merge mining has only been used for weird altcoins like Namecoin. And it has not been used for 202 00:21:05,040 --> 00:21:12,480 L2s of Bitcoin, where you have actual Bitcoin, or in my case, eCash. So I think that that, 203 00:21:13,440 --> 00:21:17,920 he would certainly be in favor of that. I don't think Satoshi was a big, you know, 204 00:21:17,920 --> 00:21:22,400 maximalist, actually. It seems kind of strange to say, but he was very, he was unconcerned when 205 00:21:22,960 --> 00:21:26,720 Namecoin was invented. He was mostly interested in how it would be used. 206 00:21:29,040 --> 00:21:32,640 I would hope that he would support the project. I should mention that even though it is a hard 207 00:21:33,360 --> 00:21:40,800 fork, we have a controversial element of, he, Satoshi himself has like a list of 1.1 million, 208 00:21:41,520 --> 00:21:49,440 a bunch of UTXOs that can, that add up to 1.1 million BTC. And we only give him half of his 209 00:21:51,280 --> 00:21:58,080 stash. But that is because it's going to be difficult to make the hard fork a success. 210 00:21:58,720 --> 00:22:05,760 And if it succeeds, it will just have highlighted how we were right about BTC being in danger 211 00:22:05,760 --> 00:22:13,840 of being replaced. So I can get into a little more of that, but I think, you know, if you want 212 00:22:13,840 --> 00:22:20,400 the, we're already giving away for free, you know, the BIP300 on BTC. So that's always there 213 00:22:20,400 --> 00:22:26,400 as the option. But you have to go this other route. It will be very difficult to make a hard 214 00:22:26,400 --> 00:22:33,920 fork with its own brand and its own, its own fate, a success. But I think if it succeeds, 215 00:22:33,920 --> 00:22:40,240 it will only have proven that BTC was actually vulnerable to being replaced this whole time. 216 00:22:40,960 --> 00:22:46,560 Announcement here today, timeline, what does it look like? What's coming? And 217 00:22:47,360 --> 00:22:55,120 when will eCash be live? Yeah, it'll be late August. So basically four months from now. 218 00:22:56,880 --> 00:23:01,680 And then, you know, I'm sure that'll be a very chaotic day and a very chaotic week. 219 00:23:02,720 --> 00:23:06,880 And then, you know, it'll probably we'll have to see how it takes shape over the next 220 00:23:07,680 --> 00:23:15,360 year or so and then reassess, like if it's actually achieving its goals. The optimistic 221 00:23:15,360 --> 00:23:24,320 case is that it, you know, that a lot of the L2s attract users. So, for example, 222 00:23:24,320 --> 00:23:28,320 we want to have like a scalability L2 and a privacy L2 if people are actually using it for 223 00:23:28,320 --> 00:23:34,720 those things and to have my prediction markets project. So like if those are actually acquiring 224 00:23:34,720 --> 00:23:40,320 users and there's a little network effect is building up, then we have the potential to have 225 00:23:40,320 --> 00:23:47,840 unlimited growth in transaction fee and fee revenue for miners on those L2s. So if that 226 00:23:47,840 --> 00:23:54,080 has started to happen, then the optimistic case is that the network of new network effects of this 227 00:23:54,080 --> 00:24:00,800 project would just accumulate and it would eventually be, you know, an enormous amount of 228 00:24:00,800 --> 00:24:06,800 mining revenue enough to make the project a big success, you know, in the future and 229 00:24:08,240 --> 00:24:13,600 potentially even replace BTC because BTC will have diminishing mining revenue and have low 230 00:24:13,600 --> 00:24:18,080 proof of work and become insecure, among other reasons, just being less popular. 231 00:24:19,040 --> 00:24:23,680 So that would be like we have to see is it doing that or is it is it forcing a conversation with 232 00:24:23,680 --> 00:24:31,760 BTC about its future? If it's so, if it's succeeding, then we'll know. And then if it's not, 233 00:24:31,760 --> 00:24:37,040 then we'll figure out who should do something else. Could just be a demo. This could just be 234 00:24:37,040 --> 00:24:41,520 a demonstration of what BTC should do. Maybe it would work as that. So we'll have to see. 235 00:24:42,320 --> 00:24:48,800 If eCash is successful, Bitcoin could move in the direction and adopt BIP300, right? 236 00:24:50,080 --> 00:24:58,800 Right. The thing is, I'm not sure if like it was already BIP300 was already like one of these 237 00:24:59,469 --> 00:25:12,469 opt-in, reversible, ignorable soft forks, it was already like endorsed by lots of people and it was already just like strictly additive to mining revenues. 238 00:25:12,469 --> 00:25:25,469 So I don't know, like it was already like a really good idea served up on a silver platter and already you could do it without modifying Bitcoin Core with the CUSF that I invented, 239 00:25:25,469 --> 00:25:41,469 Core Untouched Soft Fork. So I think it would be more than just activating BIP300. It has to be like this huge cultural revolution where it's like people say, well, we were wrong to put so much attention on Lightning Network. 240 00:25:41,469 --> 00:26:00,469 It would have to be a lot of different things. So I don't know if it would be that simple or that possible. I think that's part of my essay about the derangements of Bitcoin or my list is like the culture, I think, is very confused. 241 00:26:00,469 --> 00:26:07,469 And I don't think I'm not sure if it would be that simple, but I hope that it's still possible. 242 00:26:08,469 --> 00:26:19,469 Most forks of Bitcoin have been hostile. They've put user coins in danger at the point of the fork. Do users need to be informed? What do they need to do? 243 00:26:19,469 --> 00:26:28,469 Smart contracts on Bitcoin, no longer just an Ethereum thing. OpNet, it's different. It's not a sidechain. It's not a bridge. It's not a wrapped asset. It's a meta protocol. 244 00:26:28,469 --> 00:26:41,469 Your Bitcoin stays on Bitcoin the entire time. And every OpNet transaction is just a Bitcoin transaction. Connect your Bitcoin wallet, make trustless swaps with no new tokens to buy, no new chain to learn. 245 00:26:41,469 --> 00:26:51,469 Bitcoin is the gas. If you've been waiting for DeFi that doesn't ask you to migrate to another crypto asset, OpNet just went live on mainnet. You can check it out at opnet.org. 246 00:26:52,469 --> 00:27:03,469 Yeah, there is something called transaction replay, which is important to keep in mind, which is if you make a transaction on one of the networks, it's possible that it will just be valid on both networks. 247 00:27:03,469 --> 00:27:25,469 In one sense, this is kind of like keeping a Dropbox folder synchronized. But it's like if you send two BTC to your friend, if Paul sends two Bitcoin to Pete, then it's possible that you would have had two eCash. 248 00:27:25,469 --> 00:27:41,469 They also end up going to Pete. If you download our software, you can split the coins permanently, but maybe some people won't want to do that because in order to do that, you have to put your private keys into a new piece of software. 249 00:27:41,469 --> 00:27:58,469 So you wouldn't want to do that on day one. It's just typing a private key into someone's software. So yeah, I think the smart thing would be to just kind of wait and get information from people you trust about what they are doing. 250 00:27:58,469 --> 00:28:13,469 And that's probably the most reliable advice. Just keep in mind that you're getting a bunch of free money. I mean, you could also just make peace with it. You could just say, well, I'm getting a bunch of free money, but maybe I don't understand how to claim it. So just forget about it. 251 00:28:13,469 --> 00:28:25,469 But I think probably it would be nearer to the time of the fork. You'll be able to figure out what your friends and advisors are doing. But yeah, that's something to keep in mind. 252 00:28:25,469 --> 00:28:51,469 I think the reason that most forks were hostile was because they all put Bitcoin in the name. And I think that people don't like that. They know that the brand should only refer to one thing at a time. So even if they don't agree with everything in BTC world, they think it's annoying to have one word describe two different things. So I think that was annoying for people. 253 00:28:52,469 --> 00:29:13,469 There are going to be a lot of other differences about eCash as opposed to Bitcoin, the structure, how it's running, how it's operating. Can you talk a little bit about LayerTwo Labs, how you plan to manage this ecosystem and bootstrap it? And what are the conflicts that you see with that company? Or how do you see reducing the involvement of that company over time? 254 00:29:14,469 --> 00:29:27,469 Well, I don't think there will be any need for an L1 because, again, I want to keep the L1 the same as Bitcoin Core. So it really shouldn't be any development effort put in there. 255 00:29:28,469 --> 00:29:49,469 Even Bitcoin Core's terrible mistakes and bad ideas, I plan to just merge across and just keep it very, very, very simple so that it's just a tiny little patch set. And that is a completely different type of project than if you were running a full node of whatever, Ethereum or Solana or something. 256 00:29:49,469 --> 00:29:59,469 So right off the bat, that is just like a few minutes every six months out of a really talented person's time. 257 00:29:59,469 --> 00:30:13,469 So the L1, that should be OK. And even the L2s, we built a lot of them already. So I think we, in a strange way, I think this is actually the most decentralized project as far as development goes. 258 00:30:14,469 --> 00:30:29,469 Because the L1 is free riding off of Bitcoin Core. And the L2s, many of them already exist. So like enough of them exist. And then anyone can propose new ones through the system already. 259 00:30:29,469 --> 00:30:45,469 And the existing graphical user interface and everything will just add them. Also, the front end is, so in Bitcoin Core, there's this Qt interface that's like tightly connected to the source code in the C++ source code. 260 00:30:46,469 --> 00:30:58,469 But we have ours as a disconnected user interface. So actually, even that people can fork and just change the color without touching the L1 code. 261 00:30:59,469 --> 00:31:12,469 So I think it will be very, very, very easy to maintain and keep competitive because the L1 is just Bitcoin Core. So that takes basically zero effort. L2s already exist. There will be new people competing with them. 262 00:31:13,469 --> 00:31:24,469 I think competition will keep things in line and will keep the contributions coming in because they'll be from people who really want an actual change. 263 00:31:25,469 --> 00:31:34,469 So I think that it will be very, very easy to, from an overhead point of view, to run the project. I'm not really worried about that. 264 00:31:35,469 --> 00:31:47,469 As part of this, you'll be airdropping new Bitcoins, eCash tokens to everyone who owns Bitcoin. This includes the large institutions and asset managers who now own Bitcoin on behalf of other people. 265 00:31:48,469 --> 00:31:56,469 How do you expect them to react to the projects? Are you doing outreach to those institutions? And what has their response been, if so? 266 00:31:57,469 --> 00:32:08,469 It's a very interesting idea. I don't know what they will make of this. I haven't spoken to them yet because this project has mostly been secret until now. 267 00:32:09,469 --> 00:32:13,469 Although it's a secret that I guess a lot of people knew about, but I was mostly not telling people. 268 00:32:14,469 --> 00:32:23,469 There's still four months to plan. It's an interesting idea. In Bitcoin, we have the not your keys, not your coins mantra. 269 00:32:24,469 --> 00:32:38,469 And so according to some Bitcoiners, if you own Bitcoin in an ETF or if you keep your Bitcoin on an exchange, according to some, they would say, well, you don't really own any Bitcoin, actually. 270 00:32:39,469 --> 00:32:45,469 You have a relationship with the ETF and maybe they'll give you – but they're the real owner. 271 00:32:46,469 --> 00:32:56,469 And so, yeah, to anyone who owns the coins on the network at the time of the fork, that will get credited. So really, they will get your eCash. 272 00:32:57,469 --> 00:33:01,469 Will they just give it to you? I don't know. 273 00:33:01,469 --> 00:33:13,469 I think probably people should try to find out. And if they won't, then you would tend to want to withdraw. 274 00:33:14,469 --> 00:33:23,469 You'd want to withdraw for like the one day. Withdraw, keep it on your own computer, the coin split, and then deposit again. 275 00:33:24,469 --> 00:33:34,469 You would think that they wouldn't want you to withdraw, so they would proactively take some kind of step to make sure that you get whatever you think you deserve. 276 00:33:35,469 --> 00:33:47,469 I think there's definitely an argument to say that this has all gotten too institutionalized and that it would be good to some extent if there was a little bit of chaos thrown in. 277 00:33:48,469 --> 00:33:54,469 Because we want to encourage people to self-custody Bitcoin on their own node. 278 00:33:55,469 --> 00:34:06,469 If they do, then they will get the fork. Particularly if this idea, the eCash hard fork, if this triggers like a wave of copycats and there's just lots of people doing forks like this, 279 00:34:07,469 --> 00:34:13,469 then it will be all the people who have Bitcoin on their own full node, they will just be getting all this free money all day. 280 00:34:14,469 --> 00:34:17,469 But if you have your coins on an exchange, the exchange will be getting all that. 281 00:34:18,469 --> 00:34:28,469 So I don't know. I think it's a very interesting – a lot of different things are possible, including things that are very frustrating for people and also including things that people think are great. 282 00:34:28,469 --> 00:34:41,469 I would hope that the large institutions would either just credit everyone or I would kind of prefer that they just keep – selfishly keep the coins because I think it's also good. 283 00:34:42,469 --> 00:34:48,469 I think it's also good for me if anyone just thinks, oh, these are valuable coins and I want them. I did though. 284 00:34:49,469 --> 00:34:57,469 To some extent, you've already outsourced – you've already said to a large ETF or whatever, you've said, oh, you can have custody of my BTC. 285 00:34:58,469 --> 00:35:04,469 So that's what you've said. So now they'll have custody of your eCash as well. I'm not exactly sure what will happen. 286 00:35:05,469 --> 00:35:16,469 Is price going to be the denominator of success for eCash? And if it's not, I guess how will you tell whether eCash is making progress against Bitcoin? 287 00:35:16,469 --> 00:35:23,469 Well, there is a second thing other than the price. The price obviously is a pretty useful indicator. 288 00:35:24,469 --> 00:35:32,469 But also the total transaction fee revenues expressed in US dollar purchasing power, that would be a second thing. 289 00:35:33,469 --> 00:35:37,469 If either of those are really, really healthy, that would indicate success. 290 00:35:38,469 --> 00:35:43,469 If both of them are very low, then that would indicate that the market doesn't really care that much. 291 00:35:43,469 --> 00:35:52,469 When Bitcoin Cash launched, when it debuted in November 2017, because it had launched before, it was one of many problems with Bitcoin Cash. 292 00:35:53,469 --> 00:35:56,469 They had like a convoluted rollout that was like not announced. 293 00:35:57,469 --> 00:36:02,469 And that it had already existed for several months before people realized what it was or whatever. It's a long story. 294 00:36:03,469 --> 00:36:12,469 But when it really debuted in November 2017, it briefly became the number two coin by price. 295 00:36:13,469 --> 00:36:19,469 And this led to a famous tweet from Vitalik who said, congrats on this seriously to Roger Ver. 296 00:36:20,469 --> 00:36:29,469 And so the big debut, a Bitcoin fork made it to number two and it was trading at something like 15% of BTC's price. 297 00:36:29,469 --> 00:36:36,469 This was back then. If a coin today debuted at 15% of Bitcoin's price, it would be the number three coin. 298 00:36:37,469 --> 00:36:42,469 So I have no idea to what extent these are comparable situations. 299 00:36:43,469 --> 00:36:50,469 But I do think it's the case that a hard fork is playing ball with people. 300 00:36:51,469 --> 00:36:57,469 A hard fork is more cooperative to the Bitcoin owner because we give all the Bitcoin owner their fair share. 301 00:36:58,469 --> 00:37:01,469 Except for Satoshi in this case, as I mentioned previously. 302 00:37:02,469 --> 00:37:05,469 But we give everyone, we cut everyone in. 303 00:37:06,469 --> 00:37:11,469 And I think that if you compare that to an altcoin, it's in a completely different league. 304 00:37:12,469 --> 00:37:17,469 And so I actually do wonder about another thing that happened was, of course, Bitcoin Cash and Bitcoin SV. 305 00:37:18,469 --> 00:37:25,469 They didn't have that much success, even though Bitcoin Cash is still today like in the top 15 of coins, which is very good. 306 00:37:25,469 --> 00:37:29,469 Especially because it's very long, you know, it's geometric fall off in market cap. 307 00:37:30,469 --> 00:37:37,469 But so, yeah, to be like in the top 15 is like a completely different league than like the top 30 or something. 308 00:37:38,469 --> 00:37:51,469 But I think Bitcoin Cash and Bitcoin SV kind of like it was so miserable and it was so confusing and people hated it all so much that it discredited the hard fork unfairly. 309 00:37:51,469 --> 00:37:54,469 People actually have forgotten about it. 310 00:37:55,469 --> 00:37:59,469 And so I think it'll be very interesting to see people's reaction to this. 311 00:38:00,469 --> 00:38:04,469 They may some people may really, really like it and they may think, well, actually, this is what we should do. 312 00:38:05,469 --> 00:38:12,469 Every time there's a dispute, you know, every time with Luke Dashjr. or whatever, we should just have this thing split off. 313 00:38:13,469 --> 00:38:15,469 And I've written a lot in the past. 314 00:38:16,469 --> 00:38:20,469 There's a lot of nuances to the hard fork and hard fork is very dangerous and it should not be used. 315 00:38:21,469 --> 00:38:25,469 Yeah. And in particular, the hard fork, you basically have to have some. 316 00:38:26,469 --> 00:38:31,469 There's going to be a pre-existing chain and then there's going to be something brand new. 317 00:38:32,469 --> 00:38:37,469 And the pre-existing one has a lot of benefits that it just passively has. 318 00:38:38,469 --> 00:38:44,469 And this is bad for the principle of competition, because ideally there would be two equal competitors for each decision. 319 00:38:45,469 --> 00:38:48,469 And then we would be easy for the better one to win. 320 00:38:48,469 --> 00:38:51,469 So the new hard fork has a lot of disadvantages. 321 00:38:52,469 --> 00:38:58,469 But even despite all of this stuff and despite all the mistakes made by Bitcoin Cash, it did it did briefly go to number two. 322 00:38:59,469 --> 00:39:01,469 For one day when it debuted. 323 00:39:02,469 --> 00:39:05,469 And it's still at somewhere in the top 15. 324 00:39:06,469 --> 00:39:08,469 So it's still worth huge amounts. 325 00:39:09,469 --> 00:39:15,469 It created an enormous amount of value in a sustainable sense over what is now basically nine years. 326 00:39:15,469 --> 00:39:19,469 So over the last nine years, it's still stayed in the top 15. 327 00:39:20,469 --> 00:39:23,469 So it's much better than many other altcoins. 328 00:39:24,469 --> 00:39:29,469 So I think that price, it's a stiff competition, actually. 329 00:39:30,469 --> 00:39:36,469 But I think price would be a very, you know, that's a very strong indicator of validation for people. 330 00:39:37,469 --> 00:39:54,469 But I would also say if the price is kind of like not doing that well, but there is the sustainable growth in real users, I would say that that would only mean that it's only a matter of time before investors, you know, or even just the users decide, I'm just going to keep a little of this because I use it every day. 331 00:39:55,469 --> 00:39:57,469 The users are the most scarce resource. 332 00:39:58,469 --> 00:40:01,469 Are exchanges and miners supporting this at launch? 333 00:40:01,469 --> 00:40:04,469 Well, I think we have some exchanges that will. 334 00:40:04,469 --> 00:40:06,469 We also have one of our L2s. 335 00:40:06,469 --> 00:40:08,469 It's called CoinShift. 336 00:40:08,469 --> 00:40:13,469 It kind of is a an exchange all by itself. 337 00:40:13,469 --> 00:40:22,469 Now, I can't guarantee I have talked to some exchanges who've said that they will, but I can't guarantee I have no idea if they're just being polite or whatever, you know. 338 00:40:22,469 --> 00:40:31,469 But I think because of the way the transaction replay works and because the L1 is a clone of Bitcoin Core, so it's not like new. 339 00:40:32,469 --> 00:40:34,469 It's not like anything new that they'll have to figure out. 340 00:40:34,469 --> 00:40:37,469 They just have to kind of copy and paste their setup. 341 00:40:38,469 --> 00:40:44,469 And I would think that they would with respect to exchanges. 342 00:40:44,469 --> 00:40:48,469 The same thing with the miners, which is they could say this or that. 343 00:40:49,469 --> 00:40:54,469 But that I don't think an agreement is as good as to have a real incentive. 344 00:40:54,469 --> 00:41:04,469 So in order to create the hard fork, the mechanism by which that is splitting off is that will lower the block difficulty to its lowest value. 345 00:41:05,469 --> 00:41:07,469 And that makes it very easy to mine. 346 00:41:07,469 --> 00:41:18,469 So even if the blocks are worth one millionth of what a BTC block is worth, since you have to subtract, you know, you have to subtract the revenue minus cost. 347 00:41:19,469 --> 00:41:26,469 For a brief time, it would be very, very, very easy to mine the eCash blocks until the difficulty moves back up. 348 00:41:27,469 --> 00:41:31,469 And as a result, that should attract miners. 349 00:41:32,469 --> 00:41:37,469 So, yeah, that's the plan is to make it in their incentive to do so. 350 00:41:38,469 --> 00:41:44,469 In addition to talking to some people and saying among the like there's some a few group chats and stuff. 351 00:41:45,469 --> 00:41:56,469 People are they're excited to try to mine themselves, especially because with the low difficulty, it will be possible to dig out old hardware and have it mine for just a little bit, maybe like two or three days. 352 00:41:56,469 --> 00:41:59,469 You shoot through two thousand blocks in a day or so. 353 00:42:00,469 --> 00:42:01,469 Difficulty would go up and up and up. 354 00:42:02,469 --> 00:42:04,469 From then it will depend completely on the price. 355 00:42:05,469 --> 00:42:06,469 The price goes up. 356 00:42:07,469 --> 00:42:11,469 To be more mining, if the price goes down, then there'll be less mining, but the difficulty will go back down. 357 00:42:12,469 --> 00:42:16,469 So it'll be like a normal proof of work blockchain at that point. 358 00:42:16,469 --> 00:42:18,469 Paul, you're one of my favorite writers on the subject. 359 00:42:19,469 --> 00:42:22,469 You have an immense body of work at Truthcoin. 360 00:42:23,469 --> 00:42:26,469 You've contributed a lot to Bitcoin and the thinking and others like myself. 361 00:42:27,469 --> 00:42:29,469 What are you risking by doing this project? 362 00:42:29,469 --> 00:42:36,469 I don't think I'm risking that much because what is the reputation in Bitcoin really even worth at this point? 363 00:42:37,469 --> 00:42:39,469 Which is I never thought that it was like a very valuable thing to have. 364 00:42:40,469 --> 00:42:49,469 But I think that like what is the point of like what would we even do with the community now? 365 00:42:50,469 --> 00:42:54,469 So I think, again, like it's kind of like topped out. 366 00:42:55,469 --> 00:42:56,469 Like if we allow. 367 00:42:58,469 --> 00:43:00,469 Like we've come very, very far, which has been great. 368 00:43:01,469 --> 00:43:03,469 But I don't see how we can. 369 00:43:06,469 --> 00:43:07,469 You know, I just don't see where we go from here. 370 00:43:08,469 --> 00:43:18,469 So I think, you know, it would be what it was different before when it was like everyone was starting like people starting BitPay or even BTC. 371 00:43:19,469 --> 00:43:21,469 BTC pay server. Now, what would people just work on? 372 00:43:22,469 --> 00:43:23,469 What like custodial lightning or their work? 373 00:43:24,469 --> 00:43:28,469 So I don't know. So I think I'd really we have very little to lose and a lot to gain. 374 00:43:29,469 --> 00:43:30,469 You're announcing the hard fork today. 375 00:43:31,469 --> 00:43:35,469 The eCash project born out of LayerTwo Labs, trading your own coin, creating your own chain. 376 00:43:36,469 --> 00:43:38,469 Final question. Are you still a Bitcoiner? 377 00:43:39,469 --> 00:43:40,469 Well, I would think so. 378 00:43:41,469 --> 00:43:43,469 Yeah, I don't plan on selling BTC. 379 00:43:43,469 --> 00:43:53,469 I see this as kind of a hedge against the failure of BTC, which is something that I always thought BTC couldn't possibly fail. 380 00:43:54,469 --> 00:44:00,469 But over the last few years, I have become worried about the overconfidence and complacency. 381 00:44:01,469 --> 00:44:03,469 So I think, yeah, I don't think I'll be selling my BTC. 382 00:44:03,469 --> 00:44:17,469 But I will be trying to improve this competitor as both a backup plan if BTC doesn't work out and also as maybe an example of what BTC should be more like. 383 00:44:18,469 --> 00:44:19,469 Thanks, everyone, for watching. 384 00:44:20,469 --> 00:44:26,469 While you're still here, head over to Trezor.io and check out the latest and greatest in Bitcoin hardware wallet security. 385 00:44:27,469 --> 00:44:29,469 I'm talking about the Trezor Safe 7. 386 00:44:30,469 --> 00:44:33,469 Use the promo code RIZO for a 5% discount today.