Hello, and welcome to Drivechain Talk, Twitter Space.
This is May 1st, and we are excited to have another chat about Drivechain today.
I'm Henry at LayerTwo Labs, and everyone in the audience is welcome to come on up
and ask any questions you might have about Drivechain,
chat about the prospect of sidechains revolutionizing Bitcoin development
and strengthening Bitcoin's potential for value accrual
and blocks-based value accrual in the future.
Drivechain is an idea whose time has come.
Eight years into the development of this project,
we are now at a moment where there's a lot of attention on it.
We have prominent support from such Bitcoin thought leaders as Adam Back and Fiatjaf,
Mike Tidwell, and many others who are Drivechain fans, some of them Drivechain fanatics.
Many people are very excited about how sidechains can fulfill the promise of Bitcoin
to serve as a platform for a variety of technology that is permissionless and peer-to-peer,
such as oracles, large blocks, strong fungibility, DNS, and other technology.
All of those technologies can be built on Bitcoin instead of built on altcoins.
Right now, Bitcoin doesn't offer those technologies in a peer-to-peer format,
but with Drivechain, those technologies would be available in a peer-to-peer format.
Right now, Drivechain is existing as a testnet and existing as a movement
which has a Bitcoin improvement proposal, two of them, in fact, ready for consideration by the community.
An effort is underway with an expert in the community to rebase both of the BIPs,
bringing them up to readiness, full readiness for consideration by the community in terms of merging them into the code.
It's a very exciting time to be interested in Drivechain.
Sidechains have been contemplated by Bitcoin thinkers for quite a while.
There is an excellent paper by Blockstream in 2014 on sidechains,
and then they also have another excellent paper a few years later about Liquid specifically.
Sidechains have their roots, I would say, in the 2010 writings of Satoshi
when he thought about merged-mined altcoins, which, of course, aren't sidechains but altcoins.
He thought about BitDNS serving as a DNS on blockchain, merged-mined with Bitcoin.
So at the very beginnings of Bitcoin, back in 2010, Satoshi himself contemplated the possibility of a multitude of blockchains built on Bitcoin.
And, of course, a merged-mined altcoin isn't as exciting as a merged-mined sidechain
because the sidechain accrues value to Bitcoin mainchain,
whereas the merged-mined altcoin merely accrues value to Bitcoin's block space.
There are two goods in the Bitcoin network,
and the goal of sidechains, specifically of the Drivechain variety,
is to boost the value of not only the Bitcoin block space but also the Bitcoin token.
What we want is for all of the value accrued on the sidechain,
all of the value proposition and network effect of the sidechain,
to be harmonious and symbiotic with the economics of the mainchain,
such that each of these Bitcoin sidechains is a force for good in terms of bringing more people to Bitcoin,
bringing more value to Bitcoin.
If anyone in the audience would like to come on up and raise their hand and ask a question, you're welcome to.
Feel free to join the stage and share your question if you'd like.
In the meantime, let's put up some food for thought in the nest.
Let's get some interesting tweets up in the nest for conversation.
The first thing in the nest is the badge.
The badge of Drivechain. There it is, PIP-303-01.
All right.
Everyone's welcome to come on up to the stage and ask a question. Don't be shy.
If you're in the audience and you have a question, you can, in your app, select to raise your hand.
And then you can join the stage and ask your question.
Welcome. Welcome, everyone, to the audience.
Please do feel free to raise your hand and come on up to the stage if you'd like to discuss Drivechain.
It would be great to have anyone come on up and ask a question or share a comment about it.
So feel free to raise your hand and come on up to the stage to chat about BIP300 and BIP301.
Thank you.
Thank you.
Thank you.
So who has a question or comment about Drivechain?
Don't be shy. Come on up and let's chat about it.
Drivechain is a very powerful idea.
What it would do is provide strengthened facilities for Bitcoin sidechains.
Right now, every Bitcoin sidechain is federated.
A federated sidechain involves control of the Bitcoin held in the sidechain by a group of people, 15 people.
Whereas in a Drivechain format, it's the miners who participate in the security model of that Bitcoin held in a hash rate escrow.
So instead of a federated sidechain being the only format for sidechains, if Drivechain is adopted, then we have a new model available.
And it's opt-in. No one has to use it.
So it's all optional.
But if it's introduced, then I think a lot of people will use it and it'll help Bitcoin grow enormously.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Thank you.
Hello, and welcome to Drivechain Duh.
Welcome, everyone, to Drivechain Twitter Spaces.
If you have a question or comment or want to chat, come on up.
Usually we have a larger crowd today, it's pretty quiet.
If anyone has any questions about Drivechain or would like to come up and chat, do.
Hello, MoonSettler.
Come on up if you'd like to chat about our favorite
topic.
Welcome, Raybon. Go for it.
What should I go for?
You could share a comment or question about Drivechain if you'd like.
I don't know enough about it, honestly.
That's alright.
Not a people do, even though it's been talked about within Bitcoin's
community for about 8 years,
only recently has it gotten more attention.
Are you familiar with idea of sidechains or merged mining?
Yeah, I'm a current participant and so is it anything similar to like the way
a full payout per share pool works?
a nice
or LinCoin, it something like that?
I would have to just look those up for a minute, but NiceHash is where you rent
hashing, correct? From like a centralized company?
Yeah, it's like a marketplace, totally.
So I think this wouldn't be that, because that's
Drivechain is a proposal for a soft fork that would introduce a new
option for the way things can be done.
currently, NiceHash is up and running and is centralized, whereas Drivechain is an
effort to make sidechains of Bitcoin not federated.
So currently, I'm sure you've heard of like Liquid and RSK.
Those are the two largest sidechains on Bitcoin.
They're not that large right now.
They're like 50 or 70 million dollars each in terms of like the market cap of the
Bitcoin that's been sent to those sidechains.
What is the name of that one you just mentioned?
The other one's called Rootstock.
Okay, I've heard of too.
wasn't sure. Yeah, I mean, they're not that big.
They aren't like billions the way, for example, wrapped Bitcoin is like four
billion dollars
value. People have often heard of wrapped Bitcoin, but Liquid, which is by Blockstream
and RSK, which is Rootstock,
those two sidechains are not that big.
So Drivechain is an idea which might make sidechains much bigger on
Bitcoin. So it's possible that
if the Drivechain BIPs are adopted, like the, know, SegWit was adopted in 2017,
Taproot was adopted in 2021, Drivechain is an idea which could be adopted
in like 2024, for example, hypothetically.
And if it were, then we might
start to see a lot more value in these Bitcoin
sidechains. instead of Liquid and RSK being rather small, Liquid and RSK and other
sidechains might grow much larger because the Drivechain architecture
is designed
to sidechains, to make sidechains more peer -to -peer rather than federated.
Currently, every Bitcoin sidechain uses a federation.
And Drivechain is different.
is, to quote Adam back, more peer -to -peer.
It's an approach to side change that's more peer -to -peer because
instead of a 15 -person multi -sig controlling Bitcoin, that has been sent to the
sidechain.
Drivechain uses something called Hashrate escrow which is BIP300 and the
miners play an important role in that.
The goal here is to make sidechains more
like Bitcoin and that they're peer -to -peer rather than having a trusted third party,
which is how we could describe the federations that currently control the Bitcoin
in various sidechains today.
So the places that people can learn more about Drivechain include the Telegram group,
which has 700 members,
drivechain.info website, there's also videos online.
Some of the applications that Drivechain would bring to Bitcoiners include more
privacy, so you could have a sidechain that's focused on very strong privacy, and you
can also have a sidechain focused
Large blocks? Hold on, hold on.
What do you mean by large blocks?
that's exactly the right reaction people sometimes have because people think, wait,
what's the reason to have large blocks anywhere?
Wasn't
think like weren't large blocks something that were, you know, considered and rejected
in Bitcoin's history?
it turns out, and Adam back, you know, tweets about this.
So, not just him, but many other people think that it would be good to have people be
able to opt
in to large blocks purely optional.
So if you want to do a lot of transactions that are maybe smaller value like buying
coffee, then you want to have a fee that's low and lightning
is great for smaller value, higher frequency, low fee
payments, but large blocks is another way of doing it that has a different set of
features and advantages and it would be a good complement to Lightning.
If you wanted to onboard billions of people to Lightning, it would take decades because
there's only so many channel opening transactions that can be done in every
block. every Bitcoin block can only hold so many
transactions. So if you had the whole world onboarded to Lightning, it would take
like 40 years to onboard like 8 billion people.
So if we want to have Bitcoin be used by the
whole world and not have everyone cut in third -party custody at Coinbase,
a lower decentralization.
Do you think Cuckbase?
Sorry, Cuckbase? Yeah.
Yeah, so if the goal is to avoid things like Coinbase and embrace peer -to -peer,
then a large block sidechain is exactly one good path to do it.
that's what Adam back recently tweeted.
I'll just find the tweet and share it in a blatant appeal.
Damn, got Adam on your side now, Henry.
That's good. Fuck yeah.
a blatant appeal to authority, I'll just find his tweet and share it.
have to scroll a bit to find it.
as I do that, there are a bunch of, this is like the essence of Drivechain, that there
are a bunch of cool technologies that currently aren't possible to build on Bitcoin in
a peer -to -peer manner.
And Drivechain would
enable those technologies to be built on Bitcoin, specifically on Bitcoin's sidechains,
are completely optional.
No one has to use it.
It's like Lightning.
No one has to use Lightning.
You can just do main chain Bitcoin.
In the far future, Bitcoin is extremely successful, the fees
will be pretty high on MainChain.
People also will want to do applications that are not possible
on example, MainChain has
small blocks. If you wanted to use a large block version of Bitcoin, could use a
sidechain that
has that larger block size.
So it would be a clone of Bitcoin, except it has a larger block size, enabling lower
fees, higher throughput, but it's still peer -to -peer.
It's not reliant on some centralized third party.
there would be, if Drivechain's adopted, we'll
is a sidechain for privacy that uses the technology from zcash a sidechain for
smart contracts that uses the technology from ethereum and a sidechain
for large blocks kind of like bitcoin cash or bsv just large block version what is the
tech of ethereum that makes it stand out
to you? when I look at it, just see, like, I don't see a breakthrough.
I don't see a technology.
I just see, like, a company with, like, a product, you know?
Yeah. So some of the technology that might be,
so the question kind of gets to, like, is blockchain for only
payments or are there things beyond payments that can be done on blockchain and should
be done on blockchain that's one way of putting your question and think that
there are applications other than just payments so for example even
payments itself like money on blockchain and people say
Bitcoin not blockchain, know, there's there's even variations within the money category
like more private money or more scalable money.
larger blocks or more privacy, more fungibility, right?
So if you wanted to have on blockchain, a extremely private
way
of sending money around, you would want use the technology from these privacy altcoins.
But the problem with those altcoins is that they have a token that is like money
printing. So the whole goal of Drivechain is to eliminate all of the money
printing of altcoins, but enable Bitcoin
So,
there's a tweet from Adam Back where he said, am an innovation maximalist, but I'm
an altcoin senior age critic.
So, he wants the technology of the altcoins without the money printing, and that's what
Drivechain
Chain is about.
It's that basically, instead of saying that altcoins are all worthless, what we want to
do is bring the technology of the good ones.
There's a few good ones for, as I mentioned, privacy, large blocks, also peer -to
oracles. All of those technologies and DNS, that's
himself talked about back in August 2010.
He wrote in of DNS on blockchain.
the idea that blockchains only for payments is not quite right.
And instead it would be good for Bitcoin to be able to have these peer to peer side
chains that have these interesting and potentially
very valuable technologies, eliminating all of the altcoin money printing.
So actually, Drivechain is an idea which is directly attacking altcoins
in the sense that, like, you're like me and you think it'd be
great just to have Bitcoin's
monetary policy be the monetary policy of the whole world.
If that's what you want to happen, want to see happen.
If you want see that happen, Drivechain.
That's what I want to happen.
Yeah, that's what Drivechain is designed to help make happen because it's all about
eliminating all of the altcoin money printing, but at the same time enabling their
technology to be built on Bitcoin.
Could it embolden them to continue on their own test?
Because they're doing it, the big boss is doing it, like, and I do it too.
I mean, that's just conjecture, but you know what I'm You mean like when they say that
Bitcoin is the big boss and Bitcoin got value, so they want to have their own?
Is that what you meant?
Yeah, if you bring some of these things to Bitcoin, doesn't it sort of validate their
efforts in a way?
Yeah, that's what Jimmy Song said to me in a conversation about a year ago on Twitter
Spaces. He's like, I used to be in favor of Drivechain, but now I'm not because I think
it would validate altcoins.
altcoins. See, I see it the opposite way, do the Drivechain.
See, I was kind of thinking that too, it's a two at double edge.
either emboldens some folks, but for the most part, it would make people just abandon
their shitcoin. I can see why that would happen too.
So I think that if
Bitcoiners were to drop this mantra that there's no good technology outside of Bitcoin
and instead tweak their their view with to have the drivechain view which is that
right now altcoins some of them have good technology but we want to we want to
eliminate the monetary policy of those altcoins.
Let's take a look at Bitcoin.
to zero and have Bitcoin be the only token that's a monetary token.
In order to do that we have to enable Bitcoin to have a narrative which is that
everything you want to build on blockchain you can build on Bitcoin and right now that
narrative doesn't exist
because if you want to build on Bitcoin smart contracts, privacy technology
of the kind that Monero or Zcash has or large blocks
or DNS if you want to build those applications on
Bitcoin the only way to do it is a federated
sidechain like Liquid or RSK.
All of the sidechains right now on Bitcoin are federated, 100 % of them.
There's no way around it.
Drivechain aims to fix that, to make these sidechains more peer -to -peer.
And therefore, the sidechains would potentially, and I can't promise it will happen,
but potentially have a
narrative, which is that they're more or less trustless and they're reliable.
And we could see these drivechains over the course of years grow into the billions of
dollars of value.
And what's critical there is that all of that value is going to increase Bitcoin's
price. And
also all of the transaction fees on the sidechains are paid to Bitcoin miners so
drivechain is designed to make Bitcoin more valuable and stronger
in terms of miner revenue and also Bitcoin token price now you might ask
well Henry how does like the value
on the sidechain accrue to Bitcoin's mainchain?
Well, there's what's called a two -way peg between the sidechain and the mainchain.
And currently, the Bitcoin sidechains have this, the federated ones.
They have a two -way peg.
if you were to go out and buy, let's say, hypothetically, a billion dollars' worth of
liquid Bitcoin, which is the native token
of the liquid network sidechain.
If you were buy a billion dollars worth of it, all that demand that you're creating for
the liquid token would actually increase Bitcoin's price because there's a two -way peg
between liquid Bitcoin and Bitcoin on the main chain, like actual Bitcoin.
And that two -way peg means
that if there's demand for the sidechain token, that increases the value of the main
chain token.
Does that that make sense?
I know that was a lot of work.
think so. And I think I get what you're saying, most to the most part, what I'm
concerned with is like,
I think would probably, it's like a, it's a vague sort of concern because I don't
really know, but like LayerTwo Labs, like that's, that's your, you're employed by them,
right? Yeah. they're the ones, are they the ones that the only group trying to
implement the BIPs for Drivechain?
Well, mean, other people talk about it
who aren't in LayerTwo Labs like Fiatjaf, creator of Noster.
He's a... Drivechain more like an overall term for the that avenue
of trying to create a peer -to -peer version of like the like what Liquid does?
mean, LayerTwo Labs is only one year old.
Drivechains is eight years
old.
Yeah, I didn't really know that.
didn't know. No problem.
Almost no one's heard of LayerTwo Labs,
but it only has five employees.
That's what I was going to ask.
many employees? it's got five people?
Yeah, five employees.
would say most of the Drivechain
supporters don't have anything to do with LayerTwo Labs because it's like small kind of
niche company. Drivechain, I would say, is the property of the whole Bitcoin community.
The fact that...
I don't know, that's...when I hear that, scares me.
Because I'm like, is it?
It's like Taproot or SegWit.
It's an idea, part of the source
development community. mean the Bips are listed on the Bitcoin GitHub and you
know the maintainers or Luke or someone added the drivechain Bips to the GitHub for
Bitcoin. So everyone in the world can see all of the code and the explanation
for these Bips for for the consideration
of the community it's like SegWit taproot BIP 119 any of
these Proposals that had you know, some of which have been accepted some of which have
been rejected others are just out there in Consideration and I would say drivechain is
in that number 39
BIP 39
It's a good one, right?
I mean, they're all very interesting.
I really like BIP39.
think it's a good one too, Raybo.
Welcome to the stage.
yeah, mean the purpose of
these spaces, have them every Monday and Thursday, is just to chat about Drivechain and
answer questions, share comments.
Sometimes we have critics, we have supporters, sometimes we just have people who want
to... Yeah, dude, what's the number one critic?
What's overarching, when people have a problem with Drivechain or
or they don't like it, I don't really feel either one way or the other because I don't
fully understand it.
What is the crux of the issue to you?
Why has it been so long that there hasn't been a that passed?
Or has there been any to do with it?
no
there has never been any Drivechain BIPs that have been adopted.
There are two BIPs.
It's BIP300 and 301.
Those two BIPs.
The first one is the two -way peg that's peer -to -peer called Hashrate Escrow.
BIP301 is secondary and less important, but they're both designed to work together.
The second one is called blind merge mining.
just an improvement on that, designed by the Drivechain authors.
what blind merge mining does is enables the Bitcoin miners to receive the transaction
fees of the sidechains without running the
sidechain node. blind merge mining lowers the burden and complexity of getting those
fees for the Bitcoin miners.
And you asked a great question.
what's the primary
by the Drivechain critics with respect to Drivechain?
the primary objection, if you were to talk to Greg Maxwell or Shinobi
or Peter Todd or other people
Jimmy Song. Todd, he the barber in that movie with the Edward Scissorhands kind of
vibe?
A Sweeney Todd, bro.
Yeah, so there are some big names in Bitcoin who don't like Drivechain and some that
do, know, Fiatjaf
Drivechain.
So the critics, it's a great question, what's the criticisms?
They would point to the influence of Drivechain on the and how the miners have a lot
power in the drivechain
ecosystem in their view, and that the miners would have too much power
and influence, and that there might be force of less
decentralization. If Drivechain's adopted, in their
view, large miners could collude to steal money from the hashrate escrow.
they also think that the burden of running nodes would arise for small miners.
Even though blind merge mining exists, there would be a profit motive to have
the nodes running Which would be hard for some small miner to have the nodes of the
sidechain, especially if they're yeah What are the requirements it like or?
What's the idea as far as so I didn't realize that part so you'd have to run a node So
let's say I got Bitcoin core node.
run the nodes of the sidechain.
the whole system is designed to be completely optional.
Like no one has to do anything.
It's like lightning.
doesn't have any negative impact on anyone.
Like lightning doesn't harm
Bitcoin to the sidechain to use the sidechain,
the synthetic Bitcoin on the sidechain, which is one -for -one pegged with mainchain
Bitcoin. That increases the price of Bitcoin.
It's kind of like this.
Imagine if Ethereum and Zcash were sidechains of Bitcoin.
If that were the case, and all of the transaction fees were being paid
The Bitcoin miners would have much higher revenue, which would mean...
They probably should have pursued that and they'd be more relevant today.
Exactly. That is the vision exactly of Drivechain, that it would create like harmony
and collaboration among all of the altcoin communities, because they would get
rid of their altcoin they'd come to Bitcoin use Bitcoin sidechains and then we'd all
be Bitcoiners there would be no like competition for like who has the monetary
token there'd no like money printing it all be about technology it would be better
if the entire crypto community were just
everything were built on Bitcoin.
just, and we wouldn't be like judging the project so much.
Like all of this hatred of altcoins, it really might go away if Drivechain's adopted
and then all of the altcoins just go to zero in theory.
That's like a fantasy scenario that I think will come true, but it's sort of hard
just a Bitcoin sidechain.
of the... the way I see it, really does have 100 % dominance.
when you think about that, you got, let's say when people say it's a 50 % dominance, if
I create 10 more tokens, that dominance goes down, but all I did was poof something out
of the air.
But I know what you're saying, I agree with
You know what I mean?
when people point to Bitcoin dominance, like it's a metric, it's really unfair, or
it's skewed. Yeah, yeah, it's a complicated topic of market cap
because, you know, they're stablecoins and also,
Yeah, it's manipulated like someone can print a trillion tokens and then trade one of
them for ten dollars and then they claim A ten trillion dollars.
Look how fast it went.
Okay, the speed the transactions per second Yeah, god damn.
They claim a ten trillion dollar
cap. So part of what it takes though to like really grok Drivechain, part of what it
takes, and this is hard for a of people, is you've got to understand that there is some
legitimate valuable technology in some altcoins and
that it would be better for Bitcoiners and everyone if that technology were copied onto
a Bitcoin sidechain, which would enable people to use that technology, but also
have Bitcoin's unit of account.
So for example, suppose there's another blockchain out there like Zcash or
Monero. And suppose that it has very strong fungibility guarantees.
the privacy community, people trading in a regime where the government is
oppressive and they want strong privacy, which is their right.
They might use Monero instead of Bitcoin,
but the problem there is that Monero
competes for monetary premium against Bitcoin.
It would be ideal if those people could instead use a Bitcoin sidechain, which doesn't
compete for monetary premium
against Bitcoin. They would be transacting in a unit of account that is one Bitcoin
on this privacy sidechain.
And then when they're done, they could do the peg out back to the main chain, get
Bitcoin and be done with the sidechain.
It's kind of like, it's kind of like, imagine you have gold
bars and you convert them into gold coins by melting them down and casting them as gold
coins. And then when you're done with the coins, you can get back to bars by just
melting down the coins and then putting them into bars again.
So that's an example of a two -way peg in physical reality.
But on the blockchain, there can be a two -way peg between the sidechain and the main
chain. every sidechain would be another blockchain.
and The idea the holy grail of Bitcoin development since like for the last decade has
been how do we have a sidechain?
Where it's trustless and peer -to -peer
-peer, and you can move value, can move a Bitcoin from the main chain to the sidechain
and then get back.
So, if you've heard about like soft chains and space chains, there have been some
people who are tinkering and exploring with the idea of sidechains trying to keep them
peer -to -peer.
The
hardest part is the peg -out mechanism, which is moving value from the sidechain back to
the mainchain in a manner that's not federated.
that's what Drivechain is designed to achieve, is a
peer -to -peer peg -out mechanism
for Bitcoin sidechains, which currently doesn't exist.
currently, if you use a sidechain like Rootstock or Liquid, when you want to move your
value back to the main chain, when you're finished using the sidechain, you're to be
dealing with a federated
group of persons who are controlling those pegouts.
it's arguably permissioned and not peer -to -peer.
with Drivechain, that architecture is improved.
People have an option to use the Drivechain setup once it's adopted by the community.
and
then the whole idea is to make Bitcoin sidechains a more vibrant and successful part of
the Bitcoin ecosystem.
And it would give Bitcoin a narrative that you can build anything on Bitcoin.
It would give Bitcoin a narrative that it currently doesn't have.
Right now, the altcoins have a certain narrative,
which is, they would say, it's hard to build on Bitcoin or impossible to build on
Bitcoin. So we have to do an altcoin.
So that was actually the rationale of Ethereum.
As you know, the Ethereum white paper, the whole first couple pages are about how it's
hard or impossible to build on Bitcoin.
So that's why they had to do a new altcoin.
And if Drivechain had existed then, then they wouldn't have been able to make that
argument. So Drivechain would deprive Altcoin...
founders of their most valuable narrative, is it's impossible to build on Bitcoin and
therefore we need to build on altcoins.
So I think that
oh, Drivechain would validate altcoins.
Like they already have the
technologies on Bitcoin.
But if Drivechain were adopted, Bitcoin would seize that narrative.
Now, Bitcoin would be able to say, everything you want to build on a blockchain, can
build on Bitcoin, especially on a Bitcoin sidechain.
So drivechain would strengthen
Bitcoin's narratives and I think, like, weaken the altcoins narratives.
And that's the whole idea.
So, if you want to have an extremely strong privacy technology like Zcash,
then you could build it on a Bitcoin sidechain.
And fact, the Drivechain testnet
has a clone of Zcash running.
so the idea is there that you're moving Bitcoin around in an extremely private way
using the technology of Zcash, but you're not using the Zcash altcoin, you're using the
Bitcoin token. So the only way you
people would get tokens on the sidechain is by sending Bitcoin
to the sidechain.
And therefore, the 21 million hard cap is preserved.
Even though Bitcoin is circulating on all these sidechains, there isn't any monetary
issuance.
So every time someone creates like Ethereum or Monero or anything else, they're
printing money to, you know, create their altcoin.
It would be better if they had just created a Bitcoin sidechain.
So Drivechain tends to interest people who have a strong interest in kind of technology
and innovative
stuff like Fiatjaf, the creator of Noster likes drivechain a lot.
So it attracts people who have a strong technology orientation.
Although there are some critics who worry that drivechain would complicate the
economic design of Bitcoin
and they worry that
it places power in the hands of the miners.
So there are some lingering questions and concerns within the Bitcoin community
about Drivechain, and that's why it's been around for so many years.
But I think that its time has yet to come, and maybe in the next
couple of months or years we could see it adopted on Bitcoin and that would be very
interesting.
That's what it's all about.
I welcome you to share any thoughts or
about that. Yeah, I guess for for I think like, if it works, that's, it seems like a
good thing. What is the concern around the miners having too much power because what
they collect more fees, or how would it give them an edge like over what how it already
stands? So the Yeah, that's a great question. The um, the miners would get a lot more fees
from transactions, because let's say there are some very large sidechains on Bitcoin
in the future that are merged mind. So the miners will be getting fees from main chain
transaction fees, and also sidechain transaction fees. And the there's like a complicated theory
that goes like this, that some miners that are very large will want to run the nodes
of the sidechains in order to get even more fees because there could be meth, there could
be like a complicated profitable opportunity from running the node of the sidechain. For
example, you know how there's like meth on Ethereum, there's this issue where like, certain
parties in the Ethereum ecosystem are making more money by like reordering transactions and
other complicated things. Well, if the Bitcoin sidechain, if all of the if all of the
Ethereum were a Bitcoin sidechain, then that meth would be happening just the same way. So
some people are concerned about that. And they want to keep Bitcoin very simple. Like that's
what Peter Todd has said in some YouTubes and spaces I've seen, or maybe just YouTube, I'm not
sure if I've seen him on spaces, but he talks about how he's had some debates with Paul
Sztorc, who is the lead designer of Drivechain. I've seen them talk on one or two YouTubes. And
Peter has said that, you know, Drivechain would complicate Bitcoin and complicate the
economics of mining. So that's, that's one of the concerns about it is that it would make
Bitcoin more complicated. So some people want to have Bitcoin be as simple as possible, just be
about payments, not about, you know, financial, like more complicated financial
transactions. Because if you introduce smart contracts onto a blockchain, then there becomes
the possibility of profit being achieved by a miner who can choose which transactions to include
in a block. Like let's say you and I have a smart contract that says that, you know, if something
happens, if a certain kind of transaction happens before a certain block, then you get paid. But if
it doesn't happen, then I get paid. Well, that would give you the opportunity, you like a
profitable incentive to try to include that transaction before a certain block happens. So
there could be a bet placed on the blockchain, a smart contract, where a miner has a profitable
incentive to include a transaction earlier than later. That's like a very simple kind of example
of the kind of thing I'm talking about, which is that miners might have an incentive to start doing
certain things to make more money. So the critics of drivechain are interested in that kind of
reasoning. But the advocates for drivechain would say that in order for Bitcoin to be successful, it
has to be the platform where anything can be built on blockchain. And that way we bring, you know, all
of the shit coins over to Bitcoin, bring all of their technology, all of their value, all of their
transaction fees, all of their users, make all of those people Bitcoiners. That's the goal of drive
chain is to make the entire crypto community built on Bitcoin. And that way there are no more alt
coins being minted. And Bitcoin would have no competitors, nobody would be worried about the
flippening. And there would be also a ton of transaction fees paid to Bitcoin miners. So nobody
would be worried about the security budget. So there are there are interesting, different
motivations for drivechain. Like a person can like drivechain because they like innovation and
building. That's like the Adam Back approach. Like Adam Back is not worried about the security
budget, but he does like innovation and he likes peer to peer technology. So that's why he's into
drivechain. Like I've read all of his statements and tweets about it. And those are the things he
emphasizes peer to peer and innovation. So he's into drivechain for those reasons. Other people like
drivechain because it would bring more fees. And there other people are worried about the security
budget, which is the idea that the fees could stay low forever. And therefore the miners wouldn't have
enough income. And therefore the cost to attack the network as a 51% miner would fall. So drivechain
could fix that because it would bring fees from all these sidechains to Bitcoin miners and that would
increase their fee revenue. So as the subsidy is halved every four years, if the fees are going up a
lot, then it's okay that the subsidy is being halved. For example, Peter Todd has said he would
like he would support inflation for Bitcoin. So he would support a fork that would introduce
perpetual tail issuance inflation on Bitcoin. So instead of 21 million, he would be okay with like
1% you know, inflation forever. If I'm not I hope I'm not misquoting him. I think he's he's he said he
would support 1% or 0.1% or something, some amount of inflation forever, which a lot of Bitcoiners
wouldn't like and I wouldn't like it. So I would prefer we get more fees rather than keep things
simple, don't have sidechains and then try to do inflation instead. So that security budget problem,
that's like one line of reasoning that has interested some people. In fact, that's what got me
interested originally in drivechain, but I've kind of come around and I found that the most effective way
to talk about it is the way that Adam talks about it, which is not to talk about fees or security
budget instead to talk about innovation and peer to peer technology. Those are like the essences of
drivechain that I think speak to the most number of people in the most effective way. Like even if
there weren't any altcoins, we would still want to do drivechain to enable more peer to peer
innovation on top of Bitcoin. So it's not about drivechain is not just about worrying about altcoins
and worrying about competition. It's it's even if those altcoins didn't exist, we would still want to
build on Bitcoin in a peer to peer manner.
Yeah, so what do you think needs to happen? What are the obstacles until like, what's holding it back from
being approved? I mean, we talked about what what people have against it and stuff, but like, when it
really comes down to it for getting a bit like this activated, like, what's the roadmap look like? You
think it'll you're saying it'll happen sooner than later? Not sooner than later, but in some format in
the future? Like, is there some obstacle that needs to overcome to prove to people it's a good idea?
So the way that Bitcoin development actually happens in terms of consensus soft forks like this is
something which you get, you would get different answers from different people. My understanding,
having read articles about it, and talk to people is that when there's a consensus soft fork proposal, like
SegWit, or Taproot, which are the most recent two major ones, maybe the only major ones, except for
something that may have happened like long ago. You know, there's some debate about which there's some
debate about which changes to Bitcoin were soft forks and which were hard forks. But to keep things
really simple, basically, the big two are SegWit and Taproot. And the way that those happened was that there
was like a sense in the community that most of the Bitcoiners wanted it. And once there's that consent,
there's that sense of things, then people say there's consensus when like, almost everybody likes an idea,
we say that there's consensus. And then the Bitcoin Core maintainers, which are a group of people who are
experts in open source software development, they control, like five, approximately five people have
like access to like the permissions on GitHub to merge code. So BIP300 and 301 are code. And the
maintainers could click to like merge that code into Bitcoin Core. And that would be like the start of
Drivechain being a part of Bitcoin. And then people download nodes, like the new software from the Bitcoin
core. And then they would have that on their node, and then they would, Drivechain would be up and
running. So the answer to your question is, the thing that needs to happen in order for Drivechain to be a part
of Bitcoin is there needs to be widespread support for it in the Bitcoin community. So if everybody were like,
yeah, we want to have sidechains on Bitcoin that are more peer to peer, so we can build on Bitcoin, side
chains and strengthen Bitcoin, and maybe in the process, eliminate altcoins and strengthen the security
budget, like if people were all saying that, then it would happen. And right now, there's some like work being
done to rebase the code. rebasing means making the Drivechain code compatible fully with like the latest
version of Bitcoin Core such that if the community supports it, then the code could be merged into
Bitcoin Core. So the goal of LayerTwo Labs is to like fund the project of rebasing because it's expensive, it
requires like an expert on Bitcoin code to work many hours on the code to make sure that it's like totally
cleaned up and ready. So there's that work being done. And then also like popularizing the idea explaining it. So
it's it's a long it's been a long project, you know, Drivechain wasn't was first introduced in like 2015. And
then now we're eight years in to this conversation. And it's just steadily been growing over time. Some people
would say it's like never gonna happen. For example, recently, Eric Wall went on Peter, Peter McCormack's
podcast, what Bitcoin did. And Eric said, and he's a Drivechain supporter. And he said, it's it's dead. He said it
is dead, like it's not happening. So that and he's a supporter of it. He's been a supporter for years. So some
people think it's never going to happen. But I think it's really cool. And we'll have to wait and see. Probably this
is going to be the year where things come to a head. So either it'll happen this year, or it just really won't go
anywhere. Because now the idea has like funding behind it. So LayerTwo Labs raised $3 million from angel investors
to, you know, promote this idea, and try to build related projects, like build out the sidechains, and make this
happen. So in the coming months, if not a couple of years, whether Drivechain will become part of Bitcoin, or whether
some other idea will come along, like there's Simplicity, which is an upgrade for Bitcoin that has been developed by
Blockstream. So, you know, in the coming years, that will be increasingly talked about as a major change for Bitcoin
potentially. And there's other ideas out there that have been proposed for Bitcoin. Drivechain is just one of them. So
we'll see which idea kind of gets adopted by the community. And there are some people who would say Bitcoin should never
change again. So those people are in favor of ossification. They're in favor of keeping Bitcoin the way it is, and not to
have any more consensus soft fork upgrades, unless a bug appears or unless there's some problem. So some people are in favor
of just keeping things the way they are, and not really changing anything.
I appreciate your questions. They were great questions. So this has been Drivechain Twitter Spaces run by LayerTwo Labs. We meet
every Monday and Thursday at 930am Pacific to chat about Drivechain and discuss the latest ideas. Drivechain is BIP300 and 301. You
can learn more at drivechain.info. There's also videos. If you go to the LayerTwo Labs YouTube channel, there's like dozens of
videos there, mostly of Paul Sztorc giving lectures at Bitcoin conferences. Like he spoke last year with Adam Back on stage at
Bitcoin Amsterdam, and again at Bitcoin Honeybadger, Baltic Honeybadger in Latvia. So last year was a pretty big year, because
Adam spoke two times on stage with Paul about Drivechain and other things. And Fiatjaf is a supporter, Mike Tidwell of
TabConf, which is like the most kind of like hardcore technology focused conference. Well, not the most, but one of them. And Tidwell is
very sophisticated, lightning focused programmer, and he is a big supporter of Drivechain. It has been for years. So some of the most
sophisticated and well respected Bitcoin thinkers and developers like it. But of course, there are some detractors, like I think Greg
Maxwell is like opposed to Drivechain. At least I know that from like an email he wrote publicly in 2017. I'm not sure if he's ever
expressed the public view since then on it. But maybe we'll see this year, something cool could happen. There could be someone who
comes forward, who hasn't really shared a view yet, who who likes it.
Jeff, welcome to the stage. If you have any questions or comments or criticisms or anything you want to say, we have four minutes left. Four
minutes left in our scheduled programming. Usually we talk from like 9.30 to 11. So we're getting ready to wrap up today. But chime in if
you'd like.
Thank you. I really don't have anything intelligent to add. I do. I like the sound of your voice. It's really soothing. And I wasn't
really listening to anything that you were saying most of the time, but just the tonality and the way that your voice flows. And it makes
for like a really zen type of experience. I'm a little stoned right now. So it's a good vibe. I appreciate it. I appreciate you for
that. Thank you.
That's very sweet of you to say. I would like to return the compliment. I think you have a lovely tone of voice. And you also have an
impressive vocabulary. You mentioned tonality and other things. So I find you to have a mellifluous and sophisticated persona on the
internet. And I congratulate you for that.
Are you flirting with me right now?
Well, that would be a betrayal of my, you know, holy matrimony with my wife. So I would, I would say that I'm probably not. But, you
know, I was just making sure. That's okay.
Well, let's see.
I hope that if anyone takes anything away from this conversation, it's that sidechains on Bitcoin are an important topic. And that at some
point in the future, if you're devoted to Bitcoin, if you love Bitcoin, and if you want Bitcoin to succeed, then it behooves you to
understand what is a Bitcoin sidechain? What is the history of this idea of Bitcoin sidechains? And what is merged mining? So those are key
concepts. You don't have to be a drivechain supporter, to know that merged mining is something Satoshi invented. And he specifically said
that all blockchains in the future would be merged mine with Bitcoin. He wrote that in the bit DNS thread. So Satoshi had a view that
everything will be built on Bitcoin to some extent. And I think that drivechain might fulfill that vision and eliminate all of the
competition from altcoins and enable Bitcoin holders to hold their token for 100 years and retain value and grow their value without having to
worry about pivoting to some other blockchain. So the goal is to make Bitcoin the strongest possible, widest and most successful
system. And also, like, in my sort of studies of drivechain, I found that it becomes apparent when you think about it enough, and you read
enough about it that, like the blockchain that achieves a design similar to drivechain is the one that's going to in the very far future be
the one and only blockchain base layer. So we want that to be Bitcoin, we want Bitcoin to be the base layer to all the other applications out
there that are on blockchain. And if Bitcoin were to maintain a simple, narrow mandate of only doing payments of a certain kind, plus lightning, I
think that technological platform wouldn't be expansive enough. And a different blockchain would grow and accrue value and compete with
Bitcoin. So mainly Ethereum. So the goal here is before Ethereum ossifies its main chain, it would be good for Bitcoin to develop its side
chains fully. And therefore it would, it would probably absorb all of the value from Ethereum. And Bitcoin would then be left as the sole, you
know, layer one that's standing. In fact, the drivechain, you know, testnet includes a clone of Ethereum and Zcash. So those were the two that
the developers chose to start with. So they've cloned those blockchains into Bitcoin sidechains. And then that would enable all of the users
to move over and use Bitcoin. There's a lot of demand, there is a lot of demand to do smart contracting with Bitcoin. That's why $4 billion has
been sent into BitGo's wrapped Bitcoin product. People want to use Bitcoin in a smart contracting blockchain. So it's unfortunate that
everyone's using the wrapped Bitcoin product because it's totally centralized. A single company, BitGo, as I understand, is more or less in
control of that $4 billion of value of actual Bitcoin. So it'd be good if instead that were peer to peer and, you know, more trustless. So
that's the whole story. Well, it's 11 o'clock now. Let's pick up this conversation on Thursday. You're all you all are welcome back. It was
awesome to have you here. Thanks for the very good questions, Raybon and Jeff. Catch you next time on Thursday. Drivechain Twitter spaces
every Monday and Thursday. We chat about BIP300 and 301, sidechains, merged mining, innovation. That's what it's all about. I hope to see you
all again on Thursday.