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Do we have some intro music, maybe?

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That's what other people do, people who are much more interesting.

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Anyway, here we are.

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It's a new Friday.

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Sidechain extravaganza.

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I hope everyone's app works.

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Mine certainly doesn't.

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I always have to join a space like two or three times before I can even see anyone's

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image.

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And then after that, it sometimes works and then I get kicked out.

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So Elon, don't fire everyone at Twitter.

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Keep at least one.

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Hi, everyone.

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Can you hear me?

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Yes, I can hear you.

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Okay, great.

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Here we are.

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So I think we must wait for Spider-Man.

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Yeah.

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I can hear you.

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great.

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Here we are.

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So I think we must wait for Spider -Man.

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Yeah.

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Damn.

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I can ping him on Telegram.

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Good idea.

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It's a good one now, Spider, for Halloween.

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Some people have this, I want to get a gigantic, absolutely absurd

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sized inflatable spider for Halloween, just inflated

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against my house.

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and just like troll everyone and just be a crazy person but

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I would integrate you know it's a good one.

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here we go nice and now here we all are.

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Happy Friday to everyone.

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was some big, not sidechain news, but L2 news.

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Just broke.

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Sort of. I actually haven't really looked into it, but apparently this enlightening

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channel jamming thing is I remember seeing

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someone give a talk at MIT this year, but apparently

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it's worse. mean, kind of always thought the,

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where lightning really starts to run into problems is when you go through people, know,

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the bidirectional payment channels are sort of fine

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enough, but when you have to route them through third parties,

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that is when it really requires a lot of effort to keep it working.

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this is the new thing, like I mentioned this many years ago about channel risk, about

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like if you open the channel with the wrong person, you may regret

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it. But I don't know if we want to touch on this, it's so new.

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I haven't really had a chance to look into it at all.

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We already have too many new things.

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BitVM is already too new.

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I've just, uh, haven't heard of it, if you could link it, Happy Friday by the way.

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Can you hear me?

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Yes,

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can hear you.

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Link it, yes.

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Let's put it, we'll put the link in.

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Let's get that link.

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Yeah, I'm quoting this person.

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They made this public post.

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The public post is from Antoni Riard and they have like

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a very salacious sentence.

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It's just, they're very serious in their conviction.

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So I quoted it.

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Hopefully it's not too impolite.

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anyway, there it is.

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but you never know.

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Lightning already has, I'm not sure we should even go into it because Lightning already

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has many unfixable problems in my opinion.

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And there's really nothing wrong with Lightning per se.

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It's not, you know, if I can just maybe give a little bit of a take here.

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It has nothing to do with the people

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working on lightning and there's nothing to do with the lightning design.

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It is the people in the audience who are the lightning fanboys who

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basically have turned the idea into a

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weapon against Bitcoin success.

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As they turn into scaling Messiah and then it's just like,

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the idea you can't criticize and then it's just warps everything and then you have

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people who really don't,

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the non -technical people just get fed a version that is completely false and then they

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make a, they make the former worldview around

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that mistaken

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idea.

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So, there you go.

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But that's hot news.

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But maybe we'll return to it no one, if people haven't looked.

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I haven't looked into it.

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But William hasn't looked into it.

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I haven't. I think in general, coming back to Lightning,

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think the base protocol seems fairly easy, as with anything, the devil is always

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in the details and implementation.

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so I think that's something generally for any sidechain really.

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even an idea is Lightning, some hash, time locks, and two out

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of two multisigs.

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Even an idea as simple as that eventually becomes very, very difficult and a lot of

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different effect factors.

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So I think something generally we need to be aware of.

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Indeed. Okay, so what should we do here exactly?

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My guess is that most people listening to this either now or with the recording

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later, will probably like be...

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my guess is those people are all like pretty confused about

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BitVM and maybe SpiderChain, they know Drivechain a little bit better

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because we do the space every Friday.

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Maybe not though.

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I'm not sure.

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should we just do the song and dance where we explain our

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idea again? I think probably a lot of people would want to get out of this is if we

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compare and contrast the ideas somewhat.

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mean, like BitVM is like you and I would sit

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down and we want to bet half a Bitcoin on a chess game.

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This is, I'm going to give you my sort of take on it.

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And we sit down and I compute all the possible moves that I could make as white

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right now. And then if I do anything else or if I don't make one of those moves,

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have constructed something where you can, you know, the chess opponent, like Robin

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and I are going to play chess.

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And if I either don't move at all within the amount of time, or if I make some kind of

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illegal move, the,

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my

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money is slashed from me and goes to Robin.

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And so then I move pawn to e4 and then we recompute it again and we do it again.

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Except Robin has to reply in time.

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And then at the end it says if someone is in a checkmated state or whatever,

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the other person wins and if there's a stalemate, I guess there's a refund or

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something. that a good way to think about it or

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what do you think?

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kind of. But you do the calculation only once at the end in the case of a

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game. Like in the case of a game, have two phases.

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First phase is we do our moves, and then we get to a stage where

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one party says, okay, the game is over.

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And then we evaluate the shortcut given the inputs, which are the moves that we

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made.

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And then the shortcut evaluates to

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either true or false.

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And if it evaluates to true, then it means you won.

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If it evaluates to false, I won.

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Of course, it could also a draw.

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But isn't there time right before the game starts where we have to both agree to like

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how much money is, don't we fund the transaction first?

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that thing don't we have to do what do we what exactly is that's the part that

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I don't think I don't get really it's like what on L1 where I'm putting this into some

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kind of what is it being put into an L1 the two of two like we just create a joint

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output where both our money is

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in. then we do this challenge response game, or

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we prepare the challenge response game for that output.

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then at the end, one of

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us could run that challenge response game with the other

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one. Yeah, but surely you can't compute like, isn't it has to be something the way I

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said, we agree to play chess, but we can't

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possibly... How do know whether or you've broken

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the rules on the first...

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like we sit down and we pay two of two, and then it will

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like leak the other person's key if they, if the circuit.

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I still don't really get like, you can't, okay, I'm getting confused is, You can't pre

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-compute all the chess moves possible because there's far too many.

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Yeah. But we have to do something.

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When we fund the transaction, then there has to be something.

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So we fund the transaction and then the next step.

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How do I know that we're playing chess and not checkers?

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Basically. Yeah.

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we do commit to a program that can evaluate a chess position and say, if you want,

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if I want.

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Yeah, but it's okay.

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So, but this is like, I think this is also like the right way to just think about it in

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general, right? Because it is

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like people cannot really join or leave this as I understand it.

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So it is a like a bunch of people get together and play a game of some kind.

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Yeah. It's probably like the most like

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easy way for most people to understand it.

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Yeah. And you don't like have

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a global state, there's no blockchain.

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There's no... Right, because a blockchain is kind of

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like... can generate it in the privacy of your own

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home with all the blinds drawn and all the windows closed.

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You can generate as many keys as you want and then start sending coins to those.

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So it's like the blockchain has this like ability to add new people in all the time.

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But this does not, This is like people already exist.

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Well, I'm not sure, maybe it does.

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don't know. Maybe there's some kind of

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CTV thing.

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That the main drawback of the BitVM that it is limited to this

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prover -verifier setting.

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What you can do is that you have multiple verifiers.

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That is interesting, for example, for a two -way pack.

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You could have a prover that

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facilitates a two -way pack between two chains.

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And then you could have many verifiers, let's say 100 verifiers.

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And each of them can challenge them in parallel.

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And if one of them gets to the end or disproves the prover, then they

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can punish

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the prover.

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But, so like, maybe we do an example with like, with like

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actual numbers, like you have like 100.

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Well, how does it work if there's like 10?

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like, how would it work in the parallel case where someone wants to

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like, we're all here, we all are.

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opens BitVM, they want to make a new like extension block or like some kind

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of zone, like a roll up zone or

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like a payments zone.

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And so we're doing the two -way peg.

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So what do they do next?

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Yeah, there would be the prover that first has to put up some deposit

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to keep them,

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incentivize them to stay honest.

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And then they could pack BTC to the other chain, or people could just send money

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to the prover's address.

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That's how they pack in.

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And the pack out is just the prover sending the money to someone else.

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and

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And the verifiers, they would verify that this someone else is actually someone

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who packed out in the sidechain.

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Would that, with the prover address that you just mentioned, is that a separate address

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or is that address where the BitVM is deployed?

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would be a

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separate address. So you need introspection basically.

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Yes, exactly. Essentially it's introspection.

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You use the BitVM to do introspection on the transactions that the prover does, on the

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packout transactions that the prover does.

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then that

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works. think, yeah, the only limitation is then the size of the stake of the

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prover, so to speak.

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The prover probably has more money than is locked in the sidechain.

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In that simple case, maybe you can optimize it, but like in the simple idea,

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would be just, if there is one BTC in the sidechain, then the prover would have to put

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up 1.5 BTC or something to hold him accountable.

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That's pretty interesting.

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Yeah, I don't know.

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A lot of these have this

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interesting feature of people putting up the L1 coins or they put up some kind of coins

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that will be slashed later if they do the wrong thing.

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It's interesting that the regular real world operates often in almost a reverse

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way, not saying that that's good or bad.

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It's

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probably bad in fact, but it's just noteworthy that the real world has like credit,

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know, where it's like, no one has anything up.

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They just say, I will pay you.

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We will do this the right way.

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And then if I don't, then I will pay you $10,000.

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no one really, often, no

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one puts up anything.

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Although of course sometimes they do.

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put escrow. often they don't.

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So that's a neat idea.

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Okay, cool. think we should probably, we'll turn to spider chain, but I think probably

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the best thing of all would be if the audience would ask

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questions.

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Because I don't know if the three of us talk to each other.

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I'm not sure if anyone will get anything out of that.

248
00:17:02,848 --> 00:17:03,568
mean, I hope they do.

249
00:17:04,288 --> 00:17:09,768
could each compare and contrast the three the way we see it, I suppose.

250
00:17:10,408 --> 00:17:12,708
okay, well, let's go to SpiderChain.

251
00:17:12,968 --> 00:17:15,070
My understanding is SpiderChain is something

252
00:17:15,270 --> 00:17:20,950
where there's lots of -sig outputs, then there's something like on top, kind of like a,

253
00:17:21,450 --> 00:17:25,370
kind of reminds me of Counterparty, but it's not really like that at all, it's like,

254
00:17:25,710 --> 00:17:30,190
there's next, so things like Bitcoin Core, Bitcoin Core Plus, you know, Spidr version

255
00:17:30,190 --> 00:17:34,870
into the Spidrverse, and it is keeping track

256
00:17:34,953 --> 00:17:36,533
of who has staked coins,

257
00:17:37,753 --> 00:17:38,893
kind of like a BitVM.

258
00:17:39,813 --> 00:17:45,513
Like people have staked coins and in return they are allowed to spend away other

259
00:17:45,513 --> 00:17:47,833
coins that are in the multisig.

260
00:17:49,913 --> 00:17:54,733
either someone's following the rules or in the case where they are

261
00:17:54,835 --> 00:17:58,435
breaking someone is breaking rules and it's doing the wrong thing, or if enough of

262
00:17:58,435 --> 00:18:01,455
them, all each conspired to all break the rules.

263
00:18:01,555 --> 00:18:05,475
But it's a, it's kind of a similar idea where you have to have lots of different people

264
00:18:05,475 --> 00:18:10,415
involved and it's very easy for them to coordinate on the truth because that's all just

265
00:18:10,415 --> 00:18:14,115
automatic. but to get them all to steal

266
00:18:15,217 --> 00:18:20,877
they would have to coordinate amongst themselves first, which is harder to do.

267
00:18:21,117 --> 00:18:23,837
I'm not sure if that is how you would explain it.

268
00:18:23,857 --> 00:18:28,837
But I'm thinking of like there's many, many UTXOs in the spider chain world.

269
00:18:29,277 --> 00:18:34,397
time people are making new, when they deposit, they make new multisig UTXOs that are

270
00:18:34,397 --> 00:18:34,599
all

271
00:18:34,599 --> 00:18:40,319
like partly controlled by this big group, the whole web

272
00:18:40,319 --> 00:18:40,799
thing.

273
00:18:42,839 --> 00:18:45,179
Yeah. Yeah, that's the way to see it.

274
00:18:45,339 --> 00:18:51,099
I don't really think that's going to be an issue, amount of UTXO, because in the end,

275
00:18:51,299 --> 00:18:54,481
it's all on Bitcoin that you can see it as well.

276
00:18:55,921 --> 00:19:01,801
The best way to, I think, explain the Spyder chain is you basically have a bunch of

277
00:19:01,801 --> 00:19:07,581
decentralized multisigs that are controlled by the

278
00:19:07,581 --> 00:19:10,961
Stakerset. So for example, you have 10,000 different Stakers.

279
00:19:10,961 --> 00:19:14,101
Here's the output, a certain amount of Bitcoin

280
00:19:14,363 --> 00:19:17,183
in those decentralized multisex.

281
00:19:18,683 --> 00:19:23,323
And that basically secures a second layer or EVM.

282
00:19:24,603 --> 00:19:28,863
And then there's a second very interesting part of spider chain is that it asks for

283
00:19:28,863 --> 00:19:34,245
word security. So basically even if you have two thirds, you lose control

284
00:19:34,425 --> 00:19:40,225
of two -thirds majority of the Stakers' hat, they can still not

285
00:19:40,225 --> 00:19:41,185
steal any Bitcoin.

286
00:19:44,185 --> 00:19:46,025
I hope that explains it a little bit.

287
00:19:46,665 --> 00:19:49,845
In the sense, in general, sidechains, I always think you have two big parts.

288
00:19:50,665 --> 00:19:54,085
One part is how do you lock the assets, and then the

289
00:19:54,127 --> 00:19:55,707
second part is the consensus.

290
00:19:56,807 --> 00:19:59,627
Basically, how do you build the blocks in the second part of the chain?

291
00:20:00,347 --> 00:20:05,967
Compare that to Drivechain, have BIP300 for the asset locking

292
00:20:05,967 --> 00:20:10,007
mechanism, and then you have merge mining for the second part.

293
00:20:11,027 --> 00:20:13,847
then BitVM is actually, I think, it's more a

294
00:20:14,009 --> 00:20:19,569
lower level, yeah, basically

295
00:20:19,569 --> 00:20:24,649
circuit that allows you build different types of sidechains.

296
00:20:24,969 --> 00:20:29,069
So for example, in the spider chain, when we say decentralized multi -six, what it

297
00:20:29,069 --> 00:20:33,849
actually is, it's like a small BitVM in the sense that we

298
00:20:33,892 --> 00:20:39,572
build a Boolean circuit in every multi -sig wallet that

299
00:20:39,572 --> 00:20:41,832
basically holds that Bitcoin.

300
00:20:43,332 --> 00:20:49,232
that basically acts very similar to the model or optimistic proof

301
00:20:49,232 --> 00:20:51,132
that we see in BitVM.

302
00:20:51,792 --> 00:20:53,774
I think BitVM

303
00:20:53,874 --> 00:20:57,194
kind of enables way more types of sidechains.

304
00:20:57,554 --> 00:21:00,794
I think it eventually becomes very compatible.

305
00:21:03,614 --> 00:21:07,554
And then maybe the last thing I would say is in this pirate chain we actually optimized

306
00:21:07,554 --> 00:21:09,734
for fully decentralization and liveness.

307
00:21:10,554 --> 00:21:13,656
Since everyone will be able to run a full node, they

308
00:21:13,716 --> 00:21:18,216
exit and entrance of new node runners becomes very easy.

309
00:21:19,576 --> 00:21:25,416
basically you can have an unlimited amount of people running the sidechain and

310
00:21:25,416 --> 00:21:27,176
verifying the sidechain.

311
00:21:28,656 --> 00:21:29,836
Letting a short summary.

312
00:21:31,496 --> 00:21:32,996
Yeah, that's pretty interesting.

313
00:21:33,878 --> 00:21:37,218
you go over again that part about even if you lose two thirds?

314
00:21:39,738 --> 00:21:44,218
guess maybe, should we all just say, like, what would be like the worst case scenario

315
00:21:44,218 --> 00:21:44,818
for our thing?

316
00:21:44,958 --> 00:21:45,458
I don't know.

317
00:21:45,818 --> 00:21:49,978
Probably not, but yeah, you said about if you lose control of two thirds,

318
00:21:50,718 --> 00:21:53,398
you said, still, that's not

319
00:21:53,420 --> 00:21:56,560
enough. I thought I was reading Jameson Lop's summary of it.

320
00:21:57,060 --> 00:22:03,020
And he was saying something like, if you have enough of the steak, you can start just

321
00:22:03,020 --> 00:22:05,020
emptying it and giving it to yourself.

322
00:22:05,880 --> 00:22:10,320
I thought maybe, did you think he had like a fair summary or no?

323
00:22:11,180 --> 00:22:12,740
Usually Jameson Lop's pretty good.

324
00:22:13,302 --> 00:22:15,582
He's got a very good summary.

325
00:22:15,942 --> 00:22:17,582
He very quickly understood it.

326
00:22:17,582 --> 00:22:21,962
But he doesn't say that exactly what the attack factor basically is.

327
00:22:21,982 --> 00:22:26,182
Anyone with two -thirds majority of the stake can hold the sidechain.

328
00:22:26,822 --> 00:22:30,162
So basically the sidechain will stop producing new blocks.

329
00:22:30,842 --> 00:22:32,902
However, they will not be able to

330
00:22:33,184 --> 00:22:34,904
steal any Bitcoin.

331
00:22:35,344 --> 00:22:38,064
that's basically what we call forward security.

332
00:22:38,364 --> 00:22:40,684
Comes from forward secrecy and encryption.

333
00:22:41,564 --> 00:22:45,984
Basically because we have sequential multisig generating over time.

334
00:22:46,644 --> 00:22:51,824
That means that older multisig wallets are basically controlled

335
00:22:51,824 --> 00:22:52,684
by

336
00:22:53,426 --> 00:22:55,066
established stakers.

337
00:22:56,386 --> 00:23:01,746
So at a certain point in time, if you lose control of two thirds of the

338
00:23:01,746 --> 00:23:05,546
orchestrators, all the previous multi -sigs are actually still secure.

339
00:23:06,146 --> 00:23:11,566
So only the future multi -sigs that are being created from that point onwards

340
00:23:11,566 --> 00:23:12,948
are

341
00:23:13,888 --> 00:23:15,408
insecure, so to speak.

342
00:23:16,588 --> 00:23:19,148
So the older Bitcoin is still secure.

343
00:23:20,008 --> 00:23:23,788
yeah, the worst case scenario, I'm happy to talk about that.

344
00:23:23,948 --> 00:23:26,288
think in our cases, that's very clear.

345
00:23:26,828 --> 00:23:30,648
Basically, you lose two thirds majority of the Staker set.

346
00:23:32,308 --> 00:23:32,831
And

347
00:23:32,991 --> 00:23:36,391
And then the chain holds that crowds out any people.

348
00:23:36,811 --> 00:23:39,171
then basically, the chain is that.

349
00:23:39,291 --> 00:23:43,031
know everyone will still be able to get their Bitcoin back.

350
00:23:45,911 --> 00:23:47,651
yeah, the chain is basically halted.

351
00:23:48,491 --> 00:23:50,791
it's no longer useful.

352
00:23:51,831 --> 00:23:52,711
I think that's probably the worst

353
00:23:52,713 --> 00:23:53,773
case scenario.

354
00:23:55,433 --> 00:23:56,953
Well, that's not so bad.

355
00:23:58,013 --> 00:24:01,453
But I still don't understand what's happening on L1 when you say they get their coins

356
00:24:01,453 --> 00:24:06,053
back. to me, it's like you deposit the coins into something else.

357
00:24:06,573 --> 00:24:07,953
Then something else is happening.

358
00:24:08,813 --> 00:24:10,273
got was deposited to SpiderChain.

359
00:24:10,673 --> 00:24:12,595
Then I bet them on, you

360
00:24:12,595 --> 00:24:14,135
an NFL game.

361
00:24:15,135 --> 00:24:16,655
now maybe I won, I lost.

362
00:24:17,975 --> 00:24:23,975
seems like, would you say, in that scenario, it's not desirable for me

363
00:24:23,975 --> 00:24:25,395
to always be able to get my money back.

364
00:24:25,615 --> 00:24:31,195
Because if I lose to bet in the smart contract, in the spider chain, then I just say,

365
00:24:31,195 --> 00:24:32,235
oh, I get my money back

366
00:24:32,837 --> 00:24:38,717
not sure what name of

367
00:24:38,717 --> 00:24:40,077
the

368
00:24:40,077 --> 00:24:46,657
is,

369
00:24:50,157 --> 00:24:52,257
I'm not what the the Bitcoin

370
00:24:52,459 --> 00:24:57,239
back. mean, like, and if the new owner who wins the bet on L2, they can always get

371
00:24:57,239 --> 00:25:00,699
their money back on L1, even if everything goes away.

372
00:25:02,459 --> 00:25:05,159
Yeah, we'll have to be coordinated by the orchestrators.

373
00:25:06,199 --> 00:25:09,259
There's actually an opportunity to improve that part later on where you can

374
00:25:09,259 --> 00:25:10,019
unilaterally

375
00:25:11,979 --> 00:25:12,241
get

376
00:25:12,381 --> 00:25:13,541
Get Bitcoin back.

377
00:25:16,441 --> 00:25:19,981
If you build like a Boolean circuit with a BitVM, that's definitely possible.

378
00:25:20,481 --> 00:25:22,981
So I think longer term, there might be an opportunity to do that.

379
00:25:23,461 --> 00:25:27,921
In the short term, basically once the chain is taken over, you can coordinate

380
00:25:27,921 --> 00:25:32,001
with the orchestrators to

381
00:25:32,123 --> 00:25:35,683
distribute everybody's L2 Bitcoin to L1 Bitcoin.

382
00:25:36,743 --> 00:25:39,123
Very easily just send out all transactions.

383
00:25:44,163 --> 00:25:46,643
But that's the worst case scenario for the spider chain.

384
00:25:47,163 --> 00:25:48,583
How it's designed at the moment.

385
00:25:49,903 --> 00:25:52,005
Maybe you could go over again like

386
00:25:52,165 --> 00:25:54,425
the different groups, the orchestrators,

387
00:25:57,085 --> 00:25:58,285
the regular user deposits.

388
00:25:58,605 --> 00:26:00,225
So if I want to deposit a SpiderChain,

389
00:26:02,165 --> 00:26:04,985
I go to whatever, spiderchain.com or something.

390
00:26:05,725 --> 00:26:10,565
I download some software and then I send BTC to Multisig on L1.

391
00:26:10,565 --> 00:26:11,845
And the

392
00:26:11,887 --> 00:26:16,227
multisig is between me,

393
00:26:18,047 --> 00:26:23,487
I assume, me and someone from the orchestrator set, right?

394
00:26:23,487 --> 00:26:24,667
So what's the L1 multisig?

395
00:26:25,627 --> 00:26:26,307
Yeah,

396
00:26:28,027 --> 00:26:29,087
very good question.

397
00:26:29,287 --> 00:26:31,727
basically, how it looks like is very

398
00:26:31,770 --> 00:26:34,930
similar to Arbitrum if people have used that on Ethereum.

399
00:26:35,310 --> 00:26:41,010
You just go to the Botanix Bridge website, connect

400
00:26:41,010 --> 00:26:43,430
your Ethereum address, your EBM address.

401
00:26:44,890 --> 00:26:50,770
From that we will generate a certain Bitcoin address that has this step

402
00:26:50,770 --> 00:26:51,652
root circuit

403
00:26:51,732 --> 00:26:57,672
or step root tree behind it that connects your EVM address to

404
00:26:57,672 --> 00:26:59,212
that specific Bitcoin address.

405
00:26:59,852 --> 00:27:05,852
And that is a multi -sick address that is shared between a random subset of all

406
00:27:05,852 --> 00:27:06,652
the orchestrators.

407
00:27:08,392 --> 00:27:11,472
So, for example, 100 orchestrators randomly chosen out of 10

408
00:27:11,534 --> 00:27:12,194
,000 stickers.

409
00:27:14,354 --> 00:27:20,334
that basically, that transaction once confirmed will give you back

410
00:27:20,334 --> 00:27:22,454
Bitcoin on the second layer.

411
00:27:23,574 --> 00:27:28,674
Now the actual Bitcoin on the LayerOne is then secured in that single multi -sake with

412
00:27:29,154 --> 00:27:30,754
the put -free unit.

413
00:27:31,416 --> 00:27:37,296
And the idea is those people could take the L1 coins, but if

414
00:27:37,296 --> 00:27:43,256
they do, I will get reimbursed or they will get punished by the other

415
00:27:43,256 --> 00:27:45,856
orchestrators, something like that.

416
00:27:46,636 --> 00:27:51,076
Yeah, correct. It's similar to what we've discussed on the BitVM 2 effect we talked

417
00:27:51,076 --> 00:27:51,298
about

418
00:27:51,338 --> 00:27:57,258
earlier. The moment that happens, all the orchestrators, their stakes get

419
00:27:57,258 --> 00:27:57,698
slashed.

420
00:28:00,378 --> 00:28:06,198
Every orchestrator. That is part of that maliciously signed,

421
00:28:06,198 --> 00:28:07,478
a malicious transaction.

422
00:28:07,778 --> 00:28:09,498
Yeah, it's only the ones who did the wrong thing.

423
00:28:09,798 --> 00:28:10,178
Yeah, of course.

424
00:28:12,440 --> 00:28:18,080
And so they get slashed and their funds go to the other orchestrators or to miners

425
00:28:18,080 --> 00:28:19,280
or where do they go?

426
00:28:21,420 --> 00:28:24,800
The slash goes to the one who reported it.

427
00:28:25,720 --> 00:28:26,760
Oh, that's cool.

428
00:28:28,760 --> 00:28:30,820
100 % of it or...

429
00:28:32,762 --> 00:28:38,682
Yeah, idea right now is 100 % that makes the economics the most sense.

430
00:28:38,962 --> 00:28:42,362
Basically, if you remember Jameson Lott's he talks about capital efficiency.

431
00:28:42,822 --> 00:28:45,962
And it's the same issue we basically discussed earlier with the BitVM.

432
00:28:47,522 --> 00:28:50,782
If the orchestrator or the staker only has a stake

433
00:28:50,944 --> 00:28:55,544
of 1.5 Bitcoin and basically can only really secure 1 Bitcoin.

434
00:28:57,144 --> 00:29:02,844
Now if you suddenly have 100 stakers that, for example, stake 1 Bitcoin, then you can

435
00:29:02,844 --> 00:29:06,904
have at max stake 100 Bitcoin there, right?

436
00:29:07,444 --> 00:29:10,784
Because now there's 100 different stakers that all stake 1

437
00:29:10,826 --> 00:29:11,066
Bitcoin.

438
00:29:12,426 --> 00:29:17,846
But now if actually there's an incentive for all the rest of the people to actually

439
00:29:17,846 --> 00:29:22,366
report malicious behavior, they can get all the staking rewards.

440
00:29:22,686 --> 00:29:28,306
So anyone who reports could possibly get up to 99 Bitcoin of all the rest of the

441
00:29:28,306 --> 00:29:30,006
malicious stakers, so to speak.

442
00:29:30,006 --> 00:29:30,626
I

443
00:29:30,888 --> 00:29:36,348
Robin has had some similar ideas on that in the case of one -to

444
00:29:36,348 --> 00:29:38,968
-n multi -party system.

445
00:29:39,808 --> 00:29:44,728
It makes your capital efficiency of all the stakers way higher basically.

446
00:29:48,428 --> 00:29:50,568
but so I want to

447
00:29:50,591 --> 00:29:53,491
use SpiderChain. They give me the address.

448
00:29:54,291 --> 00:29:59,971
turns out Flavor is the guy who's supposed to be watching my

449
00:29:59,971 --> 00:30:04,631
coins, and he will get slashed if he does the wrong thing.

450
00:30:05,611 --> 00:30:10,473
But what if he does the wrong thing, and then he reports it also?

451
00:30:10,973 --> 00:30:13,893
he gets the money just going from one pocket to another, it seems.

452
00:30:16,693 --> 00:30:21,753
Yeah, exactly. depends if other malicious people join as well.

453
00:30:23,473 --> 00:30:28,073
So if other stakers also maliciously signed that same transaction,

454
00:30:29,313 --> 00:30:29,833
then

455
00:30:30,355 --> 00:30:32,515
he lured some people in.

456
00:30:32,915 --> 00:30:36,355
But of course you'll always pay transaction fees, et cetera.

457
00:30:37,175 --> 00:30:41,075
And he'll booted from, well, he'll have to exit.

458
00:30:41,695 --> 00:30:44,435
So it's a game where there's zero things to win.

459
00:30:44,735 --> 00:30:47,155
It doesn't hurt the system, but yeah, it's possible.

460
00:30:49,335 --> 00:30:50,175
Well, I thought it was

461
00:30:50,237 --> 00:30:54,297
something like, like if you have two thirds of the Staker set are all the same person,

462
00:30:55,617 --> 00:31:00,977
then can't they just basically take all the quote deposits

463
00:31:00,977 --> 00:31:06,437
and then report themselves and then just collect the deposits and they collect the

464
00:31:06,437 --> 00:31:08,377
slash from themselves.

465
00:31:10,759 --> 00:31:15,119
that would seem to be the losers would be the last third who weren't in on it.

466
00:31:16,959 --> 00:31:21,659
So now you have to differentiate between the whole network and a single multisig.

467
00:31:21,839 --> 00:31:23,699
It's a different game theory.

468
00:31:24,219 --> 00:31:29,099
A single multisig versus the whole network where you could have two -thirds majority.

469
00:31:30,381 --> 00:31:36,201
For the whole network, let's say you have two -thirds majority of the whole network.

470
00:31:37,141 --> 00:31:41,101
You don't have two -thirds majority of every single multisig.

471
00:31:42,641 --> 00:31:48,121
You don't any previously generated

472
00:31:48,121 --> 00:31:48,761
multisig.

473
00:31:50,323 --> 00:31:56,303
basically the only thing you can do is try to convince all the others to join you.

474
00:31:57,603 --> 00:32:01,043
then basically you're - sure, that's a slightly different setup.

475
00:32:01,363 --> 00:32:06,063
what if I'm the first, I put all of the money, the spider chain has started and I put

476
00:32:06,063 --> 00:32:07,483
all of the money in.

477
00:32:07,603 --> 00:32:09,765
I have 100 % so

478
00:32:09,765 --> 00:32:15,705
far. put 100 Bitcoin in and then someone puts whatever it would take

479
00:32:15,705 --> 00:32:17,605
to make that number work out.

480
00:32:18,945 --> 00:32:22,345
I guess they put 50 or they put 49 in.

481
00:32:22,785 --> 00:32:24,325
The next person puts 49 in.

482
00:32:24,545 --> 00:32:28,005
have two thirds and I have the oldest two thirds.

483
00:32:28,965 --> 00:32:29,647
I know

484
00:32:29,707 --> 00:32:35,567
it's kind of implausible, I suppose, but in that scenario, I can take all the

485
00:32:35,567 --> 00:32:36,067
deposits

486
00:32:37,387 --> 00:32:41,007
and the... do I also take the 49 that are the latest?

487
00:32:41,587 --> 00:32:41,867
not.

488
00:32:43,547 --> 00:32:43,987
I'm not sure.

489
00:32:45,387 --> 00:32:49,530
Yeah. now you're, yeah, initially in the first phases, like when

490
00:32:49,530 --> 00:32:54,190
when there's zero Bitcoin staked, yes, you're very vulnerable to that.

491
00:32:54,730 --> 00:32:57,710
But yeah, comes way more secure once you grow the system.

492
00:32:58,250 --> 00:33:01,110
It's basically you will start off as a federation as well.

493
00:33:02,770 --> 00:33:07,910
Basically a permissioned staking federation where people can stake with

494
00:33:07,910 --> 00:33:09,310
federation partners

495
00:33:09,412 --> 00:33:13,692
until you have enough Bitcoin staked and then you can become fully permissioned.

496
00:33:15,292 --> 00:33:18,092
And then if you try it again, then it becomes very costly.

497
00:33:20,472 --> 00:33:25,952
Cool. think probably some people that I know,

498
00:33:26,792 --> 00:33:29,232
they will want to ask about what

499
00:33:29,294 --> 00:33:34,654
happens if 51 % L1 miners try to interfere with your thing?

500
00:33:34,754 --> 00:33:36,674
Because of course in Drivechain it's not very good.

501
00:33:37,094 --> 00:33:39,974
They can interfere by just taking everything basically.

502
00:33:41,814 --> 00:33:46,394
seems also that this, I had like a conjecture many years ago that this is kind of

503
00:33:46,394 --> 00:33:49,176
always true for anything, which has been kind of

504
00:33:49,176 --> 00:33:50,996
born out by the Lightning Network.

505
00:33:53,776 --> 00:33:56,736
In BitVM, think also applies where if they...

506
00:33:58,696 --> 00:34:04,556
Somehow, if you're playing the game against 51 % miners, the game of chess

507
00:34:04,556 --> 00:34:08,436
or whatever, they also know what

508
00:34:09,058 --> 00:34:13,938
message to refuse to allow in, and they can time it out,

509
00:34:14,678 --> 00:34:20,138
take the funds, which I think is must be universal, but maybe not, I don't know.

510
00:34:21,518 --> 00:34:25,378
I don't know, maybe that's not a very interesting question, I'm not sure.

511
00:34:27,458 --> 00:34:28,940
So what would 51

512
00:34:29,360 --> 00:34:31,600
% do exactly?

513
00:34:31,900 --> 00:34:36,580
I think in the case of the spider chain, can halt the doubts,

514
00:34:37,700 --> 00:34:39,460
can halt the finality.

515
00:34:40,240 --> 00:34:46,120
Basically, would only get finality after like, I don't know, whenever you post a

516
00:34:46,120 --> 00:34:47,680
root back to Bitcoin.

517
00:34:48,360 --> 00:34:48,820
But since

518
00:34:48,882 --> 00:34:54,722
we'll probably do a weak delay for Stakers to exit, they would have to

519
00:34:54,722 --> 00:34:58,182
hold for a week in order to make the long range attack possible.

520
00:34:58,662 --> 00:35:01,922
So I don't think really there's an attack factor there.

521
00:35:03,142 --> 00:35:03,902
Yeah, there probably isn't.

522
00:35:04,082 --> 00:35:04,522
think you're right.

523
00:35:04,742 --> 00:35:07,682
it's an L1, it's just a bunch of multisek.

524
00:35:11,704 --> 00:35:13,864
So you can hold them hostage, of course.

525
00:35:15,004 --> 00:35:20,344
mean, 51 % hashrate can always hold something hostage, but anything with those timeouts,

526
00:35:22,204 --> 00:35:24,264
the hostage situation is much worse.

527
00:35:24,664 --> 00:35:28,464
But there are none, and in SpiderChain, there's no like, you must

528
00:35:28,586 --> 00:35:34,506
do this by this time or else, you know, like an

529
00:35:34,506 --> 00:35:39,786
HTLC, right? There's no, is there any equivalent of an HTLC in Spider Chain?

530
00:35:41,206 --> 00:35:42,206
No, not really.

531
00:35:42,966 --> 00:35:48,326
And even if you lose 51 % of the miners, then whenever

532
00:35:48,629 --> 00:35:52,109
transaction gets confirmed by the other 49%, like, you're so fine.

533
00:35:53,509 --> 00:35:58,429
yeah, I don't think the Spark trainings will be vulnerable to the 51 % the Yeah,

534
00:35:58,449 --> 00:35:58,909
probably not.

535
00:36:00,629 --> 00:36:04,489
Robin had a weird connecting thing, and then he's dropped down.

536
00:36:04,569 --> 00:36:07,289
He'll probably be back up soon.

537
00:36:10,251 --> 00:36:11,811
This app is very buggy, honestly.

538
00:36:12,331 --> 00:36:13,011
The spaces.

539
00:36:14,391 --> 00:36:15,271
I mean, it is for me.

540
00:36:15,331 --> 00:36:17,391
Other people seem to have no problems with it.

541
00:36:17,471 --> 00:36:19,191
Got a brand new phone and it still doesn't work.

542
00:36:21,271 --> 00:36:22,511
also have a flavor.

543
00:36:23,511 --> 00:36:24,211
He's up here.

544
00:36:24,351 --> 00:36:24,811
I think it's good.

545
00:36:24,931 --> 00:36:25,611
should have the audience.

546
00:36:25,911 --> 00:36:27,571
We should have to get the audience people up here.

547
00:36:27,731 --> 00:36:28,151
breathe

548
00:36:28,233 --> 00:36:31,313
some more life into the conversation.

549
00:36:32,713 --> 00:36:32,953
Hello.

550
00:36:35,773 --> 00:36:37,413
Can you hear me?

551
00:36:40,053 --> 00:36:43,773
I wanted to ask questions that were a little moving away from the technical side and

552
00:36:43,773 --> 00:36:48,093
just get more of a background on Willem and his kind of experience

553
00:36:48,115 --> 00:36:53,035
in Bitcoin and the inspiration behind Spiderchain?

554
00:36:54,935 --> 00:36:59,895
As a bonus question, Drivechains inspire Spiderchains at all?

555
00:37:00,755 --> 00:37:03,375
had that question for both Willem and Robin.

556
00:37:07,175 --> 00:37:07,997
I

557
00:37:08,037 --> 00:37:09,857
think can go first.

558
00:37:11,057 --> 00:37:13,817
yeah, background. Grew up in Belgium.

559
00:37:14,997 --> 00:37:17,037
lived most of my life there actually.

560
00:37:17,297 --> 00:37:19,477
I have a mathematics background.

561
00:37:20,177 --> 00:37:22,597
came to the international mathematics competition.

562
00:37:23,477 --> 00:37:25,657
That's actually where the name Botanix comes from.

563
00:37:25,957 --> 00:37:27,817
As a prize, I got this book

564
00:37:27,879 --> 00:37:29,479
about mathematics in nature.

565
00:37:31,099 --> 00:37:36,819
Very big prize, all about like trees and basically all the

566
00:37:36,819 --> 00:37:39,239
fractals and etc.

567
00:37:39,259 --> 00:37:41,959
in nature where you see the Kubernetes sequence.

568
00:37:42,719 --> 00:37:46,699
Then ended up doing electrical engineering, then in the master's focused on

569
00:37:46,699 --> 00:37:47,761
cryptography. So I broke

570
00:37:47,801 --> 00:37:53,701
some authenticated encryption algorithms, where I broke one of the

571
00:37:53,701 --> 00:37:58,101
algorithms by breaking the forward secrecy, which is basically the forward security

572
00:37:58,101 --> 00:38:01,801
used in encryption, so that came into play in the spider chain.

573
00:38:02,501 --> 00:38:06,741
That ended up doing something completely different, went into chemicals, moved to Saudi

574
00:38:06,741 --> 00:38:07,301
Arabia,

575
00:38:07,983 --> 00:38:11,943
and basically only really saw the Bitcoin micro picture.

576
00:38:12,883 --> 00:38:17,743
When I went to Lebanon, saw hyperinflation happening, put everything together very

577
00:38:17,743 --> 00:38:18,283
quickly,

578
00:38:19,863 --> 00:38:23,343
and then basically became a very big Bitcoiner.

579
00:38:23,883 --> 00:38:24,963
Then moved to the US,

580
00:38:27,625 --> 00:38:31,885
Boston, now recently last two weeks, moved to New York, missed you yesterday,

581
00:38:35,125 --> 00:38:40,945
basically like year and a half ago, tried to figure out how to basically

582
00:38:40,945 --> 00:38:46,025
build sidechains on Bitcoin because I started to realize, okay, now you have Bitcoin,

583
00:38:46,445 --> 00:38:47,265
it's going to take over the

584
00:38:47,408 --> 00:38:47,648
world.

585
00:38:49,348 --> 00:38:53,128
How is the world looking that fully runs on Bitcoin?

586
00:38:53,628 --> 00:38:56,488
Basically means our whole financial system needs to run on Bitcoin.

587
00:38:56,908 --> 00:39:02,908
That means all the stock markets, trades, yeah, insurance, whatsoever, supply

588
00:39:02,908 --> 00:39:04,008
chains will run on Bitcoin.

589
00:39:04,108 --> 00:39:05,828
How does that look like and what do you need for that?

590
00:39:05,828 --> 00:39:07,188
And so at the same

591
00:39:07,290 --> 00:39:13,250
basically, off trying get the

592
00:39:13,250 --> 00:39:18,790
Bitcoin, I started to think about how to Bitcoin, get how to get the

593
00:39:18,790 --> 00:39:19,590
Bitcoin,

594
00:39:21,230 --> 00:39:27,172
how the how the Bitcoin, dollars of applications created on an EVM.

595
00:39:28,712 --> 00:39:34,532
basically when I started off trying to design the spider chain, that boxed me

596
00:39:34,532 --> 00:39:40,172
in in the sense that I wanted to be able to run an EVM and I wanted it to be able

597
00:39:40,172 --> 00:39:44,912
to decentralized. I think one of the big issues that I'll typically always have with

598
00:39:44,912 --> 00:39:46,992
Optimistic or other type of roll

599
00:39:47,054 --> 00:39:49,794
-ups or sovereign roll -ups is that it's always one party.

600
00:39:50,314 --> 00:39:54,934
So I wanted it be fully decentralized, I wanted it to be able to run on EVM, and I

601
00:39:54,934 --> 00:39:58,474
wanted it to be able to run on current Bitcoin core.

602
00:39:59,614 --> 00:40:01,594
And that's where Drivechains came in.

603
00:40:01,754 --> 00:40:05,374
I realized that Bitcoin is falsifying more and more.

604
00:40:05,474 --> 00:40:06,774
It's very hard to make changes.

605
00:40:08,776 --> 00:40:11,216
And I did get some inspiration from Drivechains.

606
00:40:11,856 --> 00:40:16,716
I think Drivechains showed me that you need two big things in any sidechain.

607
00:40:16,896 --> 00:40:22,536
You need an asset locking mechanism, and you need a consensus or a sequence for

608
00:40:22,536 --> 00:40:26,816
deciding the blocks on your side

609
00:40:26,818 --> 00:40:27,138
sidechain.

610
00:40:29,018 --> 00:40:33,478
that drove me like, what if we don't do proof of work?

611
00:40:33,898 --> 00:40:37,058
And what happens if we change to proof of stake?

612
00:40:37,398 --> 00:40:41,518
And how can we decentralize the multisig in order asset locking mechanism?

613
00:40:41,778 --> 00:40:44,678
And that basically was the basis of the spider chain.

614
00:40:54,660 --> 00:41:00,440
I'm working on

615
00:41:00,440 --> 00:41:04,380
Zeroesync, is applying zero knowledge proofs to Bitcoin.

616
00:41:04,380 --> 00:41:06,520
Essentially, we are

617
00:41:06,842 --> 00:41:08,902
lot of things

618
00:41:08,902 --> 00:41:21,022
to

619
00:41:21,022 --> 00:41:26,382
do. We We We of We of We have a lot of to have

620
00:41:26,464 --> 00:41:29,584
super cool to have a CKB Verifier on the main layer.

621
00:41:30,604 --> 00:41:33,044
as William already mentioned, it's hard to change Bitcoin.

622
00:41:34,664 --> 00:41:39,424
So we didn't really hope for some kind of soft fork.

623
00:41:40,324 --> 00:41:45,464
Or I mean, we did at some point or still, we hope for simplicity.

624
00:41:46,204 --> 00:41:46,347
If there

625
00:41:46,427 --> 00:41:51,747
was simplicity, would basically be a byproduct to implement the ZKP verifier.

626
00:41:52,967 --> 00:41:57,587
stuff like an OBS -ZKP verify, is probably...

627
00:41:58,607 --> 00:42:04,507
That will not happen anytime soon because the proof systems are not mature yet and

628
00:42:04,507 --> 00:42:06,187
it will end essentially

629
00:42:06,229 --> 00:42:10,349
in endless bike shedding to agree on some kind of OBS -CKP verifier.

630
00:42:12,809 --> 00:42:13,629
yeah,

631
00:42:15,569 --> 00:42:21,069
Miami, Bitcoin Miami this year, I met Supertestnet and also Sam Parker and

632
00:42:22,269 --> 00:42:25,989
we were hanging out at the Nostr beach and

633
00:42:26,111 --> 00:42:31,651
we were talking about if there is not some way to hack a ZKP verifier into Bitcoin

634
00:42:31,651 --> 00:42:33,711
script as it is right now.

635
00:42:34,411 --> 00:42:40,231
And starting from there, we created the Telegram group that was titled Hack

636
00:42:40,231 --> 00:42:41,831
a ZKP Verifier into Bitcoin.

637
00:42:42,731 --> 00:42:45,891
And yeah, we have been bouncing off

638
00:42:45,993 --> 00:42:49,693
ideas of each other for like half a year now.

639
00:42:49,793 --> 00:42:54,473
And yeah, shared all kinds of different approaches that might lead somewhere.

640
00:42:55,453 --> 00:43:01,053
And then at some point I read about Matt, Merkelize, all the things.

641
00:43:02,473 --> 00:43:05,753
And then it became kind of obvious that something like that should

642
00:43:05,875 --> 00:43:08,555
be somehow possible by hacking it into Tabroot.

643
00:43:10,275 --> 00:43:12,095
That's how the BitVM was created.

644
00:43:13,175 --> 00:43:14,575
And yeah, was I inspired by Drivechains?

645
00:43:14,895 --> 00:43:16,535
Yeah, well, to some degree, of course.

646
00:43:18,795 --> 00:43:22,535
In general, I've been working on ideas,

647
00:43:24,115 --> 00:43:25,575
in general, on sidechain

648
00:43:25,757 --> 00:43:30,157
ideas since like I think I started 2019 to 2020.

649
00:43:30,257 --> 00:43:34,097
I published my first paper where I wrote about like a Bitcoin backed proof of stake,

650
00:43:34,337 --> 00:43:38,677
which is essentially a consensus mechanism that allows you to stake Bitcoins in the

651
00:43:38,677 --> 00:43:41,897
Bitcoin chain. And then you can vote on sidechain blocks.

652
00:43:42,077 --> 00:43:45,317
And if you ever actually vocate and I vote on two conflicting blocks,

653
00:43:45,839 --> 00:43:47,499
then you lose your Bitcoin in the Bitcoin chain.

654
00:43:48,559 --> 00:43:52,899
And that is a to leverage Bitcoin's proof of work to

655
00:43:52,899 --> 00:43:55,839
gain sidechain consensus.

656
00:43:57,499 --> 00:44:02,699
And yeah, I think these consensus mechanisms, there are quite a few interesting

657
00:44:02,699 --> 00:44:05,521
consensus mechanisms. There's Bitcoin back proof of stake that I just

658
00:44:05,521 --> 00:44:11,521
just mentioned, there's BIP301, is blind merge mining as Ruben Somson proposed it,

659
00:44:11,881 --> 00:44:16,781
there is merge mining of course, there are quite a few proposals and they are already,

660
00:44:17,221 --> 00:44:23,201
some of them are already possible today, though like not ideally, like, or sorry, not

661
00:44:23,201 --> 00:44:25,341
in an ideal way, but in

662
00:44:25,403 --> 00:44:26,883
some way it's already possible.

663
00:44:27,443 --> 00:44:29,383
what's really interesting is the pack.

664
00:44:30,523 --> 00:44:35,223
yeah, the two -way pack was the main reason to invent the BitVM.

665
00:44:36,563 --> 00:44:41,843
yeah, now we have that solution that is a bit better than what we had before,

666
00:44:42,683 --> 00:44:45,103
yeah, it's essentially like a

667
00:44:45,886 --> 00:44:50,366
but the trust model is reduced in the sense that you have to trust that there's at

668
00:44:50,366 --> 00:44:51,626
least one honest party.

669
00:44:51,966 --> 00:44:55,406
don't have to trust that some majority is honest, you only have to trust that there is

670
00:44:55,406 --> 00:44:59,886
one honest party in the federation, and then the peg is secure.

671
00:44:59,886 --> 00:45:01,886
So, you know.

672
00:45:04,166 --> 00:45:05,168
All right, those are

673
00:45:05,168 --> 00:45:11,088
are really insightful answers thank you so what was that oh those

674
00:45:11,088 --> 00:45:16,888
are really insightful answers thank you I guess I have more

675
00:45:16,888 --> 00:45:20,648
questions if nobody else wants to come up

676
00:45:20,648 --> 00:45:25,008
so I'm saying again this is a question kind of

677
00:45:25,050 --> 00:45:28,950
for both of you, but I guess also for Paul, if he wants to answer.

678
00:45:31,090 --> 00:45:36,590
After having discussed the worst case scenario, does the best case scenario look like

679
00:45:36,590 --> 00:45:42,470
for either of your ideas in terms of adoption, use cases,

680
00:45:43,150 --> 00:45:44,932
and what kind of roadblocks do

681
00:45:45,072 --> 00:45:47,932
you see moving forward for your ideas?

682
00:45:52,832 --> 00:45:53,212
I start?

683
00:45:55,632 --> 00:45:56,932
if nobody else is starting...

684
00:45:58,852 --> 00:45:59,932
mean, wrong one.

685
00:46:00,952 --> 00:46:04,814
we go. The idea of outcome is that we have a

686
00:46:05,054 --> 00:46:06,454
free market of sidechains.

687
00:46:07,394 --> 00:46:11,794
everybody can create their own sidechain and compete with the other sidechains.

688
00:46:12,094 --> 00:46:15,994
Paul just changed his mind.

689
00:46:16,454 --> 00:46:20,214
thumbs down, no free market of sidechains.

690
00:46:21,314 --> 00:46:23,154
So then I hit the wrong button.

691
00:46:25,316 --> 00:46:25,916
Right, thumbs up.

692
00:46:26,676 --> 00:46:32,436
So yeah, that would be great for Bitcoin if we essentially get all

693
00:46:32,436 --> 00:46:37,876
the innovations to them and have everybody who

694
00:46:37,876 --> 00:46:43,736
has great ideas trying it out on Bitcoin and no

695
00:46:43,736 --> 00:46:44,436
shitcoin

696
00:46:44,898 --> 00:46:48,278
new thingy around it, like, at least it would be great if there would be no

697
00:46:48,278 --> 00:46:49,938
justification to create shitcoins.

698
00:46:51,078 --> 00:46:55,358
then investors won't buy it, hopefully, if the market is as efficient as we would like

699
00:46:55,358 --> 00:46:56,458
it to be.

700
00:46:56,898 --> 00:47:02,758
yeah, then we would have a free market of sidechains and people could

701
00:47:02,758 --> 00:47:04,460
just try out ideas for scalability,

702
00:47:04,680 --> 00:47:06,700
privacy, utility.

703
00:47:08,540 --> 00:47:09,940
That would be my idea.

704
00:47:10,120 --> 00:47:15,300
And the biggest roadblock that I see is generalizing the BitVM bridge

705
00:47:15,300 --> 00:47:21,180
to more verifiers because in the model as it is right now, you could maybe have 100

706
00:47:21,180 --> 00:47:23,580
verifiers, maybe even a thousand if

707
00:47:24,482 --> 00:47:25,502
then, can a

708
00:47:25,502 --> 00:47:35,042
of

709
00:47:35,042 --> 00:47:40,782
stuff like lot of like like like lot of

710
00:47:41,642 --> 00:47:44,222
And then, can

711
00:47:44,225 --> 00:47:49,965
be really awesome if we could essentially have a million verifiers, and if

712
00:47:49,965 --> 00:47:51,825
one of them is honest, then the bridge works.

713
00:47:52,345 --> 00:47:53,405
That would be like the dream.

714
00:47:54,425 --> 00:47:58,625
currently it is limited by the number of verifiers, which is the biggest roadblock so

715
00:47:58,625 --> 00:47:59,005
far.

716
00:48:01,405 --> 00:48:03,305
to add to that, maybe Robin,

717
00:48:05,647 --> 00:48:07,247
I've been thinking about this a lot.

718
00:48:08,507 --> 00:48:13,507
you can basically, if you limit to 100, but you create multiple, exactly the same

719
00:48:13,507 --> 00:48:18,507
BIPMs, then there's no real reason why you cannot go beyond that.

720
00:48:19,107 --> 00:48:23,187
Like if you take the model of the spider chain, you can have 10,000 stickers, but every

721
00:48:23,187 --> 00:48:23,907
multi -stick is

722
00:48:23,989 --> 00:48:26,089
secured by 100 people.

723
00:48:26,549 --> 00:48:30,769
could do the same thing, where every bit.vm is basically

724
00:48:30,769 --> 00:48:36,329
a different subset of 100 people out of 10,000.

725
00:48:36,529 --> 00:48:42,469
then basically you can keep creating new bit.vm space that run exactly

726
00:48:42,469 --> 00:48:43,709
the same

727
00:48:44,431 --> 00:48:44,891
circuit.

728
00:48:47,131 --> 00:48:48,391
Yeah, I agree on that.

729
00:48:48,491 --> 00:48:50,291
But that requires more deposit, I think.

730
00:48:50,831 --> 00:48:56,731
I think in general, is that trade off between how much setup do you or

731
00:48:56,731 --> 00:48:59,291
like how computationally expensive can the setup be?

732
00:48:59,591 --> 00:49:00,471
That is one dimension.

733
00:49:00,551 --> 00:49:03,651
The next dimension is how much deposits shall the

734
00:49:03,753 --> 00:49:06,053
prover put up.

735
00:49:08,573 --> 00:49:13,753
The more you accept setup costs and more you accept deposit costs,

736
00:49:14,733 --> 00:49:17,613
the more verifiers you can have.

737
00:49:18,753 --> 00:49:23,593
Yeah, but your provers can be different people as well.

738
00:49:34,198 --> 00:49:39,438
then basically you can scale and you have the same capital efficiency that you have

739
00:49:39,438 --> 00:49:40,838
that you see in this BIP300 basically.

740
00:49:41,458 --> 00:49:43,518
But it might cost happiness again.

741
00:49:44,058 --> 00:49:49,498
if the pack is facilitated by like let's say three people, then all

742
00:49:49,498 --> 00:49:51,681
three of them have to agree, otherwise

743
00:49:51,781 --> 00:49:54,301
it stops working.

744
00:49:55,461 --> 00:49:56,601
The funds get frozen.

745
00:49:58,561 --> 00:50:01,881
And in the current setting, what we have is that we really have this one -off -end

746
00:50:01,881 --> 00:50:05,821
assumption, and if just one party is honest, then you have both lifeness and safety,

747
00:50:05,981 --> 00:50:07,641
which is quite strong.

748
00:50:11,504 --> 00:50:14,504
What do you do prover always has to be on online, right?

749
00:50:16,684 --> 00:50:18,864
Yeah, of course, like you can slash them if they go offline.

750
00:50:19,724 --> 00:50:20,464
Yeah, exactly.

751
00:50:23,404 --> 00:50:28,684
You don't need all parties, just need some of the verifiers to be online.

752
00:50:29,024 --> 00:50:31,327
Same as in the spider chain really, you only need

753
00:50:31,327 --> 00:50:37,247
need one of the people to not collaborate and report any malicious behavior.

754
00:50:38,527 --> 00:50:42,247
Which can be even more trust -mism, minimized with BitVM of course.

755
00:50:42,947 --> 00:50:48,927
I do see that you can do, like you get that one -of -n assumption if you have a n

756
00:50:48,927 --> 00:50:49,667
-of -n multi -sig.

757
00:50:52,850 --> 00:50:57,510
But that has the problem that you sacrifice liveness as soon as one person is offline.

758
00:51:04,410 --> 00:51:07,690
Say again, like in N N, BitVM?

759
00:51:07,690 --> 00:51:09,370
We have a 7 of 7.

760
00:51:10,530 --> 00:51:10,973
then

761
00:51:11,113 --> 00:51:16,733
we can be certain if one person is honest of that seven people, then

762
00:51:16,733 --> 00:51:18,933
nobody will ever steal that money.

763
00:51:19,713 --> 00:51:24,773
However, the problem is if only one of these seven people is offline, then the money

764
00:51:24,773 --> 00:51:26,093
cannot be moved at all.

765
00:51:26,453 --> 00:51:28,133
So we sacrifice lifeness.

766
00:51:31,257 --> 00:51:36,757
And then can have a threshold, small to say, a threshold signature.

767
00:51:37,937 --> 00:51:40,536
Then you weaken the other assumption.

768
00:51:41,117 --> 00:51:43,717
Let's say we have a 5 out of 7.

769
00:51:44,417 --> 00:51:47,677
Then that means there have to be at least 3 honest people, right?

770
00:51:49,117 --> 00:51:50,437
Correct. It's a trade -off.

771
00:51:51,280 --> 00:51:51,860
Yeah, it's a trade -off.

772
00:51:52,260 --> 00:51:55,560
And a trade -off you don't have a BitVM in the simple setting where

773
00:51:57,140 --> 00:52:02,180
one honest verifier is sufficient for both lifeness and safety.

774
00:52:05,420 --> 00:52:10,443
Yeah, no, assume more in general referencing to creating multiple

775
00:52:10,903 --> 00:52:16,243
BitVMs with multiple provers that put

776
00:52:16,243 --> 00:52:22,103
in different stakes that basically can increase your capital efficiency and solve

777
00:52:22,103 --> 00:52:26,483
that problem. Plus can solve the prover -lifeness problem.

778
00:52:29,383 --> 00:52:30,266
I can see

779
00:52:30,286 --> 00:52:33,106
a spider chain world where basically every multisig is actually

780
00:52:34,766 --> 00:52:39,266
a BitVM instead of a multisig.

781
00:52:40,506 --> 00:52:42,466
That would make sense to me.

782
00:52:43,186 --> 00:52:46,346
That you solve the capital efficiency, you solve the liveness.

783
00:52:47,366 --> 00:52:50,089
I still have to think more about like what you actually put in the BitVM.

784
00:52:51,329 --> 00:52:53,389
yeah, kind of way.

785
00:52:57,689 --> 00:53:02,969
Also there is another way that you could like cascade the validators or the verifiers.

786
00:53:03,669 --> 00:53:08,589
So you could have 100 verifiers who verify the prover, but if the prover does something

787
00:53:08,589 --> 00:53:09,869
and the verifiers

788
00:53:09,912 --> 00:53:15,792
don't act, they just do nothing or they ask stupid

789
00:53:15,792 --> 00:53:20,932
questions, quote unquote, questions that don't reveal the fraud of the prover,

790
00:53:21,872 --> 00:53:25,992
then other verifiers can slash the verifiers.

791
00:53:27,652 --> 00:53:29,532
So the first stage

792
00:53:29,735 --> 00:53:33,795
verifiers, the verifiers who are connected to the prover, they could set up circles

793
00:53:33,795 --> 00:53:36,015
with other verifiers that verify themselves.

794
00:53:36,695 --> 00:53:42,695
So you could have like this cascade of verifiers and you could help hold

795
00:53:42,695 --> 00:53:45,375
the verifiers accountable with other verifiers.

796
00:53:46,315 --> 00:53:49,315
Yeah, exactly. And then like maybe your first one can add

797
00:53:49,558 --> 00:53:55,438
on one out of an assumption where you only need one on the certifiers, but basically

798
00:53:55,438 --> 00:53:59,758
for the second layer of cascaded certifiers, can do a threshold.

799
00:54:01,418 --> 00:54:03,258
to speak. It makes a lot of sense.

800
00:54:03,438 --> 00:54:09,381
then once you have a threshold, you can probably use like a rose to swap in and out new

801
00:54:09,621 --> 00:54:12,501
or old participants, if people want to change.

802
00:54:13,201 --> 00:54:19,141
Oh, and another important point is that in general about two

803
00:54:19,141 --> 00:54:24,981
-way packs, have that thing, if that two -way pack just works somehow, even if it's very

804
00:54:24,981 --> 00:54:29,141
slow and if it's cumbersome to use it, it still is of

805
00:54:29,204 --> 00:54:34,484
great value because then you can use it to pack BTC to the sidechain.

806
00:54:35,724 --> 00:54:40,564
regular users, can just use atomic swaps between the sidechain and the mainchain.

807
00:54:40,844 --> 00:54:43,884
So, they do not have to use the pack actually.

808
00:54:44,684 --> 00:54:49,004
liquidity providers or like some, like a very small subset of the

809
00:54:49,107 --> 00:54:51,987
sidechain users would actually use the two -way pack.

810
00:54:52,747 --> 00:54:56,267
And all the other users, they just use atomic swaps.

811
00:54:57,287 --> 00:54:58,367
So for them, it's instant.

812
00:54:59,047 --> 00:55:04,867
And only if you use the real bridge, then it's slower

813
00:55:04,867 --> 00:55:05,727
and more cumbersome.

814
00:55:06,107 --> 00:55:08,850
And you need a bigger amount to pack out and stuff like that.

815
00:55:10,990 --> 00:55:13,030
But it's a great trade -off.

816
00:55:14,510 --> 00:55:20,050
It's in general a great property of two -way packs that as long as they work

817
00:55:20,050 --> 00:55:25,830
somehow, they are good enough to work really well in practice because the atomic

818
00:55:25,830 --> 00:55:26,570
swaps for the wind.

819
00:55:27,690 --> 00:55:28,210
Yeah, exactly.

820
00:55:28,674 --> 00:55:43,734
for

821
00:55:43,734 --> 00:55:44,873
the win.

822
00:55:48,717 --> 00:55:53,977
that they want it now, They want to swap out quickly and they understand that they pay

823
00:55:53,977 --> 00:55:54,817
a fee for that.

824
00:55:55,757 --> 00:55:57,077
That's what most regular people want.

825
00:55:57,297 --> 00:55:58,957
You hire a plumber or something.

826
00:55:59,557 --> 00:56:02,717
You pay, but you get what you want, and you don't have to do anything.

827
00:56:03,257 --> 00:56:04,237
But you do Uber Eats.

828
00:56:05,177 --> 00:56:08,317
You get your food, you pay, but you get

829
00:56:08,320 --> 00:56:08,880
what you want.

830
00:56:09,840 --> 00:56:15,120
And it's better to just split it into like an employees only section where the people

831
00:56:15,120 --> 00:56:18,480
swap, the people are swapping slowly and they're the ones that actually care about the

832
00:56:18,480 --> 00:56:24,000
minutia of each sidechain and whether or not it has ZK proofs or whether or not it's

833
00:56:24,000 --> 00:56:27,180
like Zcash where there might be hidden inflation bugs.

834
00:56:27,240 --> 00:56:28,000
They all care about

835
00:56:28,143 --> 00:56:33,623
this, and they make the market on the instant swap outs, but most regular people

836
00:56:33,623 --> 00:56:39,623
don't do it, except in the case where someone is handy around the house, they fix their

837
00:56:39,623 --> 00:56:43,823
own pipes, or they change the oil in their own car, or something like that.

838
00:56:45,083 --> 00:56:46,883
It's just better to split them up.

839
00:56:51,646 --> 00:56:54,026
Cool, have a Satoshi and Delirious here.

840
00:56:54,706 --> 00:56:57,546
He's now a wizard, congratulations.

841
00:56:58,266 --> 00:56:58,666
Thanks.

842
00:57:00,166 --> 00:57:01,626
Thank you. Hey, what's up, guys?

843
00:57:02,186 --> 00:57:07,546
I'm not as familiar with the flow yet for the Prover and Verifier of BitVM,

844
00:57:08,309 --> 00:57:08,849
But I have a question.

845
00:57:09,529 --> 00:57:11,749
Does the verifier have anything at stake?

846
00:57:12,729 --> 00:57:13,289
Yes.

847
00:57:15,069 --> 00:57:20,589
You want to disincentivize the verifier from starting baseless

848
00:57:20,589 --> 00:57:24,309
disputes. if the prover was honest.

849
00:57:24,489 --> 00:57:26,149
Does it cost anything for the prover?

850
00:57:26,529 --> 00:57:27,612
Like if it's a baseless dispute,

851
00:57:28,152 --> 00:57:31,372
is it really that costly for them to just disprove it real quick?

852
00:57:33,032 --> 00:57:37,892
Yeah, like they have to participate in this challenge response protocol, right?

853
00:57:38,032 --> 00:57:42,992
And they must do some, you know, a few transactions back and forth.

854
00:57:44,072 --> 00:57:46,232
And the loser should pay all the transaction fees.

855
00:57:46,892 --> 00:57:47,372
I

856
00:57:47,875 --> 00:57:53,855
the way I was thinking of is to solve the 100 verifier thing, maybe you would

857
00:57:53,855 --> 00:57:59,095
have a verifier where the public key is known for other people, but it seems like you

858
00:57:59,095 --> 00:58:00,055
can grief it.

859
00:58:02,115 --> 00:58:04,395
you can ask quote unquote stupid questions.

860
00:58:04,555 --> 00:58:07,258
can ask questions that don't reveal what...

861
00:58:07,658 --> 00:58:10,138
Does it cost anything to ask?

862
00:58:10,338 --> 00:58:11,258
that an on -chain transaction?

863
00:58:11,918 --> 00:58:12,218
Yes.

864
00:58:13,498 --> 00:58:17,818
In the worst case, I mean, you can always do everything off -chain as long as both

865
00:58:17,818 --> 00:58:21,238
parties participate. if both parties collaborate,

866
00:58:22,698 --> 00:58:26,518
But, yeah, one of the parties is lying, then they will try

867
00:58:27,081 --> 00:58:30,721
to drag it out as much as possible, of course.

868
00:58:32,741 --> 00:58:35,521
Is there any way to have a verifier that cannot do on -chain?

869
00:58:36,021 --> 00:58:37,201
They can only do off -chain.

870
00:58:37,541 --> 00:58:40,461
This way you can make that, you know, known, that public key.

871
00:58:40,561 --> 00:58:45,281
And then if there is a dispute, you know, some potential, then other verifiers would be

872
00:58:45,281 --> 00:58:46,861
like, oh, okay, you know, and

873
00:58:46,904 --> 00:58:47,704
then they'll do it on chain.

874
00:58:51,004 --> 00:58:53,224
Not really. mean,

875
00:58:55,284 --> 00:58:58,804
these hash commitments definitely allow you to do all the steps of chain.

876
00:58:59,204 --> 00:59:04,824
But the problem here is that in the very worst case, the prover just stops responding.

877
00:59:05,164 --> 00:59:06,624
They don't answer anything.

878
00:59:07,327 --> 00:59:11,647
And then you have to force them to give you a response.

879
00:59:12,987 --> 00:59:15,187
But then you're still somebody that's to take it on chain.

880
00:59:15,987 --> 00:59:16,367
Yes.

881
00:59:17,947 --> 00:59:18,887
Okay, thank you.

882
00:59:19,527 --> 00:59:21,927
The best thing you can...

883
00:59:21,927 --> 00:59:26,107
You said you are not that familiar with the internals of the BitVM, and I have not

884
00:59:26,107 --> 00:59:26,551
explained

885
00:59:26,650 --> 00:59:28,411
them publicly that well.

886
00:59:29,190 --> 00:59:34,451
These ideas of having low -level circuits, but on the other hand, having actually a

887
00:59:34,451 --> 00:59:40,210
virtual machine and then you can commit to state transitions of that virtual machine

888
00:59:40,210 --> 00:59:44,831
and then you use the circuits only to disprove an incorrect state transition of that

889
00:59:44,831 --> 00:59:45,130
machine.

890
00:59:46,534 --> 00:59:49,234
is the current idea how to build all that.

891
00:59:51,694 --> 00:59:57,454
And yeah, that search and that state transitions, would be just like

892
00:59:57,454 --> 01:00:02,314
a state is just the marker root of the memory of the machine.

893
01:00:03,214 --> 01:00:06,074
So that's essentially a hash that you commit to.

894
01:00:06,737 --> 01:00:12,537
And the Barifay would have to do a binary search in the state

895
01:00:12,537 --> 01:00:13,937
commitments of the prover.

896
01:00:14,177 --> 01:00:18,897
Like the prover just, he commits and says, yeah, state one led to state two, and state

897
01:00:18,897 --> 01:00:21,777
two led to state three, and so on and so on and so on.

898
01:00:22,617 --> 01:00:26,020
And then the Barifay has to do binary search over

899
01:00:26,080 --> 01:00:29,060
these states to find the first faulty state to disprove it.

900
01:00:29,960 --> 01:00:34,460
in particular the first thing that binary search, it's quite deterministic.

901
01:00:34,860 --> 01:00:39,940
it is at every step, it is clear what the verifier would have to ask.

902
01:00:41,000 --> 01:00:43,380
That's why you could have a verifier,

903
01:00:45,800 --> 01:00:45,843
like

904
01:00:45,843 --> 01:00:48,323
everybody could be the verifier in that case.

905
01:00:48,823 --> 01:00:51,963
And if they ask a stupid question, you can slash them for that.

906
01:00:52,283 --> 01:00:55,603
Like you can prove that this question was not the most efficient question that they

907
01:00:55,603 --> 01:00:56,323
could have asked.

908
01:00:56,583 --> 01:00:58,863
And yeah, you can punish them for that.

909
01:00:58,863 --> 01:01:02,223
It adds more complexity, but it seems possible.

910
01:01:03,863 --> 01:01:05,443
And the verifiers can be

911
01:01:05,666 --> 01:01:10,426
like a dynamic federation of newer ones coming in, previous ones being removed and

912
01:01:10,426 --> 01:01:11,506
things like this?

913
01:01:12,686 --> 01:01:16,386
The idea behind this is that everybody could be a verifier and that they don't have to

914
01:01:16,386 --> 01:01:18,966
sign up at all in the first place.

915
01:01:19,126 --> 01:01:24,106
could just like come in later and say, I will do one step of the protocol now.

916
01:01:24,246 --> 01:01:25,489
And I put up this deposit.

917
01:01:27,189 --> 01:01:31,009
I do my one step, and then there is a timeout phase where other people could challenge

918
01:01:31,009 --> 01:01:34,269
them and be like, hey, the question that you asked is not the most efficient question

919
01:01:34,269 --> 01:01:36,729
that you could have asked, so you get punished for it.

920
01:01:37,609 --> 01:01:43,349
This way, it might become open, that might solve the main pain point, and that

921
01:01:43,349 --> 01:01:45,312
might allow everybody to be

922
01:01:45,332 --> 01:01:47,732
a verifier, which is kind of like the body.

923
01:01:47,732 --> 01:01:53,652
in that case, if a person does have enough funds, they can ask their

924
01:01:53,652 --> 01:01:58,312
stupid question and then other verifiers that they control can say that it's fine as

925
01:01:58,312 --> 01:02:00,892
long as they have enough funds to attack it this way?

926
01:02:01,612 --> 01:02:03,092
Sure. Hmm.

927
01:02:04,752 --> 01:02:05,135
Yeah.

928
01:02:05,175 --> 01:02:05,795
Yeah.

929
01:02:08,275 --> 01:02:12,555
Okay. Yeah, so making it all symbol resistant is important, right?

930
01:02:13,115 --> 01:02:19,035
maybe the funds might be enough of a detractor, but still, it can

931
01:02:19,035 --> 01:02:21,095
get annoying if somebody really wants to attack.

932
01:02:21,975 --> 01:02:24,815
Yeah. Another basic question is,

933
01:02:25,398 --> 01:02:29,658
with these type of sidechains, I assume you can have merge mining and blind merge

934
01:02:29,658 --> 01:02:30,298
mining as well, right?

935
01:02:34,138 --> 01:02:36,278
I'm also asking if need make proof of stake.

936
01:02:37,418 --> 01:02:41,898
think Bitcoin back proof of stake can be very nice and it can be better than merge

937
01:02:41,898 --> 01:02:44,781
mining because the settlement velocity

938
01:02:44,881 --> 01:02:50,441
is much quicker with proof of stake because in proof of work type of things,

939
01:02:50,721 --> 01:02:56,681
usually have that the cost of block production equals the cost of attacking the chain.

940
01:02:57,201 --> 01:03:01,801
So it is just the same price of attacking the chain and being honest.

941
01:03:02,941 --> 01:03:04,581
But in a proof of stake algorithm, you

942
01:03:04,604 --> 01:03:10,304
can have a huge asymmetry because the cost of producing the chain is just the time

943
01:03:10,304 --> 01:03:12,464
value of the Bitcoins that are at stake.

944
01:03:13,424 --> 01:03:18,484
the cost of the chain is like the actual value of the Bitcoins, which is what I saw.

945
01:03:18,924 --> 01:03:23,084
But if it's not contributing to the base layer security, do you see that as an issue?

946
01:03:27,288 --> 01:03:30,288
You mean like if they are not paying enough fees?

947
01:03:31,068 --> 01:03:35,828
I'm saying if you have the sidechain running its own of stake consensus and you know

948
01:03:36,588 --> 01:03:41,628
this proof of stake consensus would be like bitcoins staked in Bitcoin in the Bitcoin

949
01:03:41,628 --> 01:03:44,251
blockchain. Right, who's earning the

950
01:03:44,311 --> 01:03:45,771
fees from this?

951
01:03:47,271 --> 01:03:49,931
Yeah, if it's open for anybody, then it's not the miners.

952
01:03:50,191 --> 01:03:55,291
And if it's not the miners, then it's not going to, you know, base layer security, Yes,

953
01:03:56,131 --> 01:03:58,031
that's true. That's a drawback.

954
01:03:58,571 --> 01:03:58,991
Definitely.

955
01:04:00,831 --> 01:04:03,991
So that being said, do you still think the proof of stake

956
01:04:04,074 --> 01:04:08,974
is better? wouldn't it be better to add to LayerOne security instead?

957
01:04:11,994 --> 01:04:17,814
Yeah, I mean, it would be definitely ideal if these go to the Bitcoin miners and

958
01:04:17,814 --> 01:04:20,694
then you add to the base layer security.

959
01:04:20,854 --> 01:04:22,134
That would be ideal, definitely.

960
01:04:24,157 --> 01:04:24,437
think...

961
01:04:25,897 --> 01:04:31,237
I'll try to in here, because I've had a lot of those discussions about if you

962
01:04:31,237 --> 01:04:37,217
have all LayerTwo and all the feeds end up being generated on LayerTwo, what does

963
01:04:37,217 --> 01:04:39,697
that leave to the miners on LayerOne?

964
01:04:41,737 --> 01:04:43,720
I actually don't think that

965
01:04:43,940 --> 01:04:47,920
will be an issue because there's a very big incentive for anyone who is running

966
01:04:47,920 --> 01:04:53,860
LayerTwo protocols or sidechains to have sufficient security to go

967
01:04:53,860 --> 01:04:54,800
back to LayerOne.

968
01:04:55,400 --> 01:05:01,340
So there's multiple ways to accrue more of the fees generated on LayerTwo

969
01:05:01,340 --> 01:05:03,320
to let that accrue back to LayerOne.

970
01:05:04,123 --> 01:05:09,643
And it's in the incentive of the LayerOne sidechain node runners to basically do

971
01:05:09,643 --> 01:05:10,223
that.

972
01:05:11,683 --> 01:05:17,263
I think that's trying to come up with a very interesting incentive model that's way

973
01:05:17,263 --> 01:05:17,903
down the line.

974
01:05:18,503 --> 01:05:20,983
I think generally that will not be the initial.

975
01:05:22,823 --> 01:05:23,303
But what do

976
01:05:37,338 --> 01:05:38,598
It's like a volunteer, you know?

977
01:05:39,198 --> 01:05:40,958
You're just like voluntarily giving up money.

978
01:05:41,858 --> 01:05:42,858
But maybe you have some...

979
01:05:42,858 --> 01:05:46,598
I can think of a scenario, if you have this LayerTwo that is proof of stake or

980
01:05:46,598 --> 01:05:51,618
whatever, if it needs to anchor to L1 anyways, the miners can say, well, if you want to

981
01:05:51,618 --> 01:05:53,438
anchor to L1, here's the fee, right?

982
01:05:56,158 --> 01:05:56,558
Exactly.

983
01:05:58,994 --> 01:05:59,994
Oh, yeah, that could be a good idea.

984
01:06:00,314 --> 01:06:00,654
of course,

985
01:06:04,574 --> 01:06:10,354
it give them an, you know, how many, the question is, like, are the bytes fungible or

986
01:06:10,354 --> 01:06:10,774
not?

987
01:06:12,174 --> 01:06:14,954
And it seems like they sort of must be to some extent.

988
01:06:16,690 --> 01:06:21,210
mean, maybe not because, I mean, what I'm getting at is they have this way of anchoring

989
01:06:21,210 --> 01:06:24,510
the L1, the picture is something like this.

990
01:06:24,590 --> 01:06:28,370
The L2 is making $50 million a day in fees.

991
01:06:29,470 --> 01:06:31,730
It's collecting 50 million a day for fees.

992
01:06:31,830 --> 01:06:35,290
And then they decided, well, we want to give some of this to the L1

993
01:06:35,446 --> 01:06:35,726
miners,

994
01:06:37,526 --> 01:06:42,806
but there's a rival L2 that is also collecting 50 million a day in fees.

995
01:06:44,386 --> 01:06:48,046
so then the miners, from the miners point of view, they're to say something like,

996
01:06:48,266 --> 01:06:48,326
listen,

997
01:06:50,506 --> 01:06:54,766
we know that you guys anchor into L1 like here and

998
01:06:54,842 --> 01:07:00,402
here. So if you want that block space, we're charging you, you know, 25 million a day

999
01:07:00,402 --> 01:07:01,702
or whatever it is.

1000
01:07:04,022 --> 01:07:09,822
And then it seems like the L2 can just innovate, excuse me, a different

1001
01:07:09,822 --> 01:07:12,162
way of anchoring and it's kind of cat and mouse.

1002
01:07:13,202 --> 01:07:14,222
Or it seems that

1003
01:07:14,318 --> 01:07:19,618
one of the L2s is at a disadvantage because it will voluntarily be paying for L1.

1004
01:07:19,638 --> 01:07:21,878
This is the collective action problem I mentioned before.

1005
01:07:22,318 --> 01:07:26,898
will voluntarily be paying an L1 and the benefit will go to both L2s.

1006
01:07:28,118 --> 01:07:32,778
it's just kind of you get the same amount regardless of how much you, everyone gets the

1007
01:07:32,778 --> 01:07:33,634
same amount regardless

1008
01:07:33,714 --> 01:07:39,054
of how much you individually pay, which probably won't

1009
01:07:39,054 --> 01:07:44,774
work. Well, in this case, if there's infinite amount of ways that they can anchor,

1010
01:07:45,814 --> 01:07:49,474
well, then you can't stop them and you can't force them to merge mine no matter what

1011
01:07:49,474 --> 01:07:50,914
anyways then, right?

1012
01:07:50,914 --> 01:07:52,354
Well,

1013
01:07:55,030 --> 01:08:00,550
idea being the way 301 was designed was

1014
01:08:00,550 --> 01:08:04,950
imagine they wanted to like vertically integrate but specialize.

1015
01:08:07,030 --> 01:08:09,790
How would they accomplish that the best way for them all?

1016
01:08:10,610 --> 01:08:12,350
what the idea of 301,

1017
01:08:12,606 --> 01:08:17,066
because what they could do is they could just try to say, we said, we hold this hostage

1018
01:08:17,066 --> 01:08:21,786
and we censor everything of this shape or something like that, which may destroy a

1019
01:08:21,786 --> 01:08:24,286
bunch of legitimate L1 use cases.

1020
01:08:24,746 --> 01:08:28,526
But I think it doesn't matter, like whether they can or they can't,

1021
01:08:30,546 --> 01:08:31,806
if they can't stop,

1022
01:08:32,882 --> 01:08:37,602
if they can't hold the L2 hostage, then you have the collective action problem and the

1023
01:08:37,602 --> 01:08:38,802
fees don't go to L1.

1024
01:08:39,482 --> 01:08:44,982
But if you can hold it hostage, then you have a conflict between L1 and

1025
01:08:44,982 --> 01:08:48,442
L2 because L2 has all the money and L1 can hold it hostage.

1026
01:08:49,182 --> 01:08:51,218
So I think the problem kind of appears either way

1027
01:08:51,338 --> 01:08:54,218
you go around that mountain.

1028
01:08:59,598 --> 01:09:03,058
Yeah, I think in general it's very hard to predict how this will play out.

1029
01:09:03,738 --> 01:09:05,658
There is, though, a very big incentive.

1030
01:09:05,898 --> 01:09:10,458
If the fees are too high, two people will just go back to I think that's

1031
01:09:10,614 --> 01:09:12,374
one thing I'll think we'll see play out.

1032
01:09:12,794 --> 01:09:17,094
second thing is something we have already seen play out, that's what's been happening

1033
01:09:17,094 --> 01:09:22,814
on Liquid. So when you think about how Liquid is implemented, they put

1034
01:09:22,814 --> 01:09:27,654
their transaction fees on Bitcoin main layer way higher

1035
01:09:27,654 --> 01:09:30,010
than anyone

1036
01:09:30,170 --> 01:09:32,270
else just to make sure that is confirmed.

1037
01:09:32,490 --> 01:09:38,150
One of the big risks of any two -way pack is that you have to calculate somehow the

1038
01:09:38,150 --> 01:09:39,990
transaction fees for your bag out.

1039
01:09:40,550 --> 01:09:46,390
And if you calculate that too low, basically your

1040
01:09:46,390 --> 01:09:48,210
whole sidechain will get stuck.

1041
01:09:48,210 --> 01:09:49,406
So you need to put

1042
01:09:49,846 --> 01:09:55,186
those transaction fees high enough, which will create automatically way higher fees for

1043
01:09:55,186 --> 01:09:59,426
the LayerOne. We've already seen that play out because of Liquid, and we'll probably

1044
01:09:59,426 --> 01:10:04,546
end up implementing it very similarly, because you don't want to have the risk that

1045
01:10:04,546 --> 01:10:08,566
basically your sidechain has two low fees

1046
01:10:08,802 --> 01:10:14,802
and then that locks your pegouts and then you

1047
01:10:14,802 --> 01:10:20,042
end up in very niche scenarios that you don't want to end up in.

1048
01:10:20,182 --> 01:10:25,142
And since it's the end user that is bridging back, is paying for fees, basically

1049
01:10:25,142 --> 01:10:28,198
you will calculate high

1050
01:10:44,258 --> 01:10:46,038
it is a collective action problem.

1051
01:10:46,218 --> 01:10:51,958
I see that but there's also a collective incentive to really make

1052
01:10:51,958 --> 01:10:54,398
sure the security of the LayerTwo is guaranteed.

1053
01:10:55,958 --> 01:11:00,918
one of the ways to do that is have high enough fees on the base layer.

1054
01:11:01,598 --> 01:11:03,438
Yeah but the withdrawal fees are

1055
01:11:04,485 --> 01:11:09,025
I think, I don't know why this is so common, but people often

1056
01:11:09,025 --> 01:11:15,025
use the word fees to refer to two completely different things, which is obviously

1057
01:11:15,025 --> 01:11:20,925
not good from the perspective of having a normal conversation about it because I use

1058
01:11:20,925 --> 01:11:23,445
fee rates for like the dollar per transaction

1059
01:11:23,591 --> 01:11:29,291
going rate, and then fees is like the total revenue of the block

1060
01:11:29,291 --> 01:11:34,231
collected. I don't know, that's just what I prefer to use, I think that the,

1061
01:11:35,571 --> 01:11:39,391
it's all the withdrawals, those are all going to be L1 transactions.

1062
01:11:39,731 --> 01:11:41,551
So they will pay the L1 rate.

1063
01:11:41,951 --> 01:11:43,258
They may play L1

1064
01:11:43,258 --> 01:11:45,558
plus a buffer, as you were saying.

1065
01:11:47,898 --> 01:11:49,198
so that's certainly true.

1066
01:11:50,598 --> 01:11:55,738
The idea that, you know, it's it's collective action problem, but there's

1067
01:11:56,478 --> 01:11:59,298
and it's we don't want to suffer from the problem.

1068
01:11:59,598 --> 01:12:01,638
That's that's true of every collective action problem.

1069
01:12:03,458 --> 01:12:06,578
The first thing you said, I don't remember what it was, but I remember thinking that

1070
01:12:06,578 --> 01:12:08,478
that's not all this is the fee versus fee rates.

1071
01:12:08,498 --> 01:12:12,958
Yeah, you're saying if L2 fees, if L2 fee rates go up, that encourages people to go to

1072
01:12:12,958 --> 01:12:14,158
L1 but that's not what I'm saying.

1073
01:12:15,138 --> 01:12:19,238
I'm saying it's quite possible that the L2 is collecting huge amounts of total fee.

1074
01:12:19,498 --> 01:12:23,718
but the fee rates will be lower because of a higher quantity of transactions.

1075
01:12:24,678 --> 01:12:29,038
So they could have 10 million times more transactions each by half as much fees as on

1076
01:12:29,038 --> 01:12:33,418
L1, but then you still have this conflict between L1 and L2 where L1 is saying,

1077
01:12:34,433 --> 01:12:39,553
listen, L1 is like whatever, Boromir from

1078
01:12:39,553 --> 01:12:41,133
Lord of the Rings.

1079
01:12:41,793 --> 01:12:46,113
He's like, we're doing all the work over here, stopping the works from invading.

1080
01:12:47,413 --> 01:12:49,328
And we don't get any

1081
01:12:49,648 --> 01:12:55,468
credit, know, and the L2 people can get 100X or 1000X or 10

1082
01:12:55,468 --> 01:12:56,768
,000X times more.

1083
01:12:56,928 --> 01:13:01,848
so I either say there will be a conflict between L1 and L2, or there'll be the

1084
01:13:01,848 --> 01:13:02,928
collective action problem.

1085
01:13:03,368 --> 01:13:04,348
Or maybe nothing will

1086
01:13:04,363 --> 01:13:07,083
happen because maybe it won't be a big deal.

1087
01:13:10,483 --> 01:13:14,863
But I guess, I think it will be a big deal in the future because it'll be a ton, we're

1088
01:13:14,863 --> 01:13:18,863
talking about a ton of money and then people will start and they won't like say it

1089
01:13:18,863 --> 01:13:19,398
overtly. they

1090
01:13:19,398 --> 01:13:20,237
They won't be like,

1091
01:13:21,357 --> 01:13:26,317
we are doing such and such because we want the fees.

1092
01:13:27,237 --> 01:13:29,078
They'll just start like little nonsense,

1093
01:13:29,078 --> 01:13:33,917
Twitter psyops and they'll say whatever sucks or

1094
01:13:33,997 --> 01:13:38,557
miners will drop every, every fifth multi-sig or something. I don't know,

1095
01:13:39,278 --> 01:13:43,237
but I think, um, it might be a, you know,

1096
01:13:43,258 --> 01:13:44,977
a rough seas.

1097
01:13:48,817 --> 01:13:51,458
Oh, here's even more of an odd ball. Um, Alex, uh,

1098
01:13:51,497 --> 01:13:54,218
Kravitz was talking about it last week where, uh,

1099
01:13:54,297 --> 01:13:59,218
in a potential world that we have a trust minimize or a trustless two-way peg.

1100
01:14:00,057 --> 01:14:03,417
Um, most likely one of the first things will happen is, uh, uh,

1101
01:14:03,458 --> 01:14:07,297
a wrapped on, on, on Ethereum for, for an actual, um,

1102
01:14:07,377 --> 01:14:12,218
trustless or trust minimize peg. And now Ethereum has a credible, um, uh,

1103
01:14:12,278 --> 01:14:16,677
Bitcoin asset. And then, um, it gives more credibility to the Ethereum EVM.

1104
01:14:17,518 --> 01:14:21,357
Uh, their fees go up because they have the network effect. Um, you know,

1105
01:14:21,437 --> 01:14:25,718
that continues to, uh, legitimize or solidify their, um,

1106
01:14:25,958 --> 01:14:29,797
network effect to continue to grow because of, uh, a two-way peg. Now that,

1107
01:14:29,797 --> 01:14:31,997
that works for, for, for Bitcoin to Ethereum.

1108
01:14:33,557 --> 01:14:34,598
What do you guys think about this?

1109
01:14:36,598 --> 01:14:38,477
I'm happy to go here. Um,

1110
01:14:38,737 --> 01:14:43,737
because a lot of people always told me over last month that I should use the

1111
01:14:43,737 --> 01:14:46,538
spider chain to build the bridge to Ethereum.

1112
01:14:46,937 --> 01:14:51,937
Now how I think about it is why would you ever use a bridge if you can just send

1113
01:14:53,338 --> 01:14:58,338
Bitcoin to a centralized exchange by Ethereum,

1114
01:14:59,218 --> 01:15:03,817
send it to Ethereum main net, and then by wrap Bitcoin,

1115
01:15:04,338 --> 01:15:06,658
like I have zero risks there.

1116
01:15:07,038 --> 01:15:09,158
And we've seen 80% of the hacks are on bridges.

1117
01:15:11,158 --> 01:15:14,437
Well, wrap Bitcoin has that centralization risk of, you know,

1118
01:15:14,437 --> 01:15:15,477
the custodial Bitco.

1119
01:15:16,997 --> 01:15:18,357
Yeah. But, um,

1120
01:15:18,398 --> 01:15:23,117
there is a big difference between security and centralization.

1121
01:15:23,237 --> 01:15:26,477
Like Liquid is probably one of the most secure things out there.

1122
01:15:27,038 --> 01:15:31,437
So security like centralized solutions can be way more secure than

1123
01:15:31,477 --> 01:15:33,518
decentralized solutions because it's, it's often trustless.

1124
01:15:33,977 --> 01:15:37,658
But the thing with Liquid is doesn't have the network effect of, you know,

1125
01:15:37,658 --> 01:15:38,377
all the, uh,

1126
01:15:38,377 --> 01:15:42,218
the DeFi protocols that Ethereum has with their TVL and, you know,

1127
01:15:42,417 --> 01:15:46,737
lock collateral in all of their whatever contracts. Right.

1128
01:15:47,098 --> 01:15:51,497
So the incentive will be for Ethereum to have, you know, sure,

1129
01:15:51,578 --> 01:15:53,377
wrap Bitcoin works fine,

1130
01:15:53,658 --> 01:15:57,417
but if they can have a better wrap Bitcoin that is actually more trustless,

1131
01:15:57,417 --> 01:16:00,977
right now that would benefit them and their whole ecosystem.

1132
01:16:03,538 --> 01:16:07,737
If you can convince the market that it's more trustless, one trustless,

1133
01:16:07,737 --> 01:16:10,417
two way packs, we haven't seen it yet. And two,

1134
01:16:10,417 --> 01:16:14,057
all the hacks I've always been happening on bridges. Um,

1135
01:16:15,018 --> 01:16:18,218
I don't know. So it's an interesting question.

1136
01:16:18,338 --> 01:16:23,098
I actually think the easiest way to maybe implement the bridges,

1137
01:16:24,338 --> 01:16:26,138
um, go on, uh,

1138
01:16:26,698 --> 01:16:31,417
go on a second layer EVM on Bitcoin and then build an EVM EVM

1139
01:16:31,437 --> 01:16:35,398
bridge, um, instead of, uh, a Bitcoin Ethereum bridge.

1140
01:16:35,917 --> 01:16:38,838
But generally I think, um, um,

1141
01:16:39,198 --> 01:16:41,598
I'm not really afraid of the decades for,

1142
01:16:42,198 --> 01:16:45,038
for the bridges taking the network packs to Ethereum.

1143
01:16:45,278 --> 01:16:50,018
I think it should, it's the opposite. Like with an EVM, um, Bitcoin,

1144
01:16:50,158 --> 01:16:54,838
I think Ethereum should be more scared that all the activity

1145
01:16:54,838 --> 01:16:56,398
will go back to Bitcoin.

1146
01:16:57,298 --> 01:17:00,658
I agree as well, because I think it still doesn't solve their whole, you know,

1147
01:17:00,658 --> 01:17:05,457
consensus problems on that side of like USDC centralization or,

1148
01:17:05,457 --> 01:17:09,977
or things like that, if they had a fork or whatever. Um, so yeah, I,

1149
01:17:09,977 --> 01:17:14,298
I think as well, if you have, um, a Bitcoin side EVM, uh,

1150
01:17:14,298 --> 01:17:18,538
eventually over time the liquidity would grow and then you're really just

1151
01:17:18,577 --> 01:17:21,058
fighting the monetary asset of Bitcoin versus Ethereum,

1152
01:17:21,058 --> 01:17:24,258
where most likely Bitcoin will continue to grow.

1153
01:17:24,278 --> 01:17:27,237
Most likely Bitcoin will continue to continue to win there.

1154
01:17:30,038 --> 01:17:33,638
That would be my hope too, but I think your concern is valid.

1155
01:17:36,398 --> 01:17:41,398
I would think if all the, um, if they all have equal features,

1156
01:17:43,038 --> 01:17:47,278
it does just put so much of a premium on the number one coin and it just

1157
01:17:47,298 --> 01:17:52,558
stigmatize everything else is my thought. So I don't know,

1158
01:17:52,558 --> 01:17:55,658
like, uh, anything that,

1159
01:17:55,898 --> 01:17:59,938
because the thing about the story you have to tell if you want Ethereum to flip

1160
01:17:59,938 --> 01:18:01,977
in BTC, the story has to be something like

1161
01:18:04,097 --> 01:18:07,737
if we at Ethereum did such and such, we have turned complete scripts.

1162
01:18:07,737 --> 01:18:11,518
We have state, we have a freedom to develop.

1163
01:18:11,518 --> 01:18:15,377
And this turned out to be more important than Bitcoin's conservatism.

1164
01:18:17,217 --> 01:18:19,418
That's like the story you have to tell, right? Like, why did it,

1165
01:18:19,597 --> 01:18:23,237
why did it flip and why should people join Ethereum as the number one coin?

1166
01:18:24,158 --> 01:18:26,678
Cause you know, you could flip, it could flip flop, you know, right.

1167
01:18:26,678 --> 01:18:30,038
Flip back and forth. So people would say, Hey,

1168
01:18:30,197 --> 01:18:32,318
the number two coin sometimes becomes number one.

1169
01:18:33,038 --> 01:18:36,357
So the story they have to tell has to be something like we have these features

1170
01:18:36,357 --> 01:18:40,357
that these properties that Bitcoin doesn't have and it's permanent.

1171
01:18:41,237 --> 01:18:46,197
But in a world where Bitcoin has just gained the ability to like where they

1172
01:18:46,197 --> 01:18:47,918
each gain each other's features,

1173
01:18:48,178 --> 01:18:52,418
then I think that's, it's not good for the number two coin.

1174
01:18:55,217 --> 01:18:56,658
But it's about the network effects.

1175
01:18:56,658 --> 01:19:00,097
And I think like Ethereum is number one when it comes to the network effects of

1176
01:19:00,097 --> 01:19:01,018
like casinos.

1177
01:19:02,977 --> 01:19:03,097
Yeah.

1178
01:19:03,097 --> 01:19:08,058
We can see also a similar example that happened when AVAX was incentivizing and

1179
01:19:08,058 --> 01:19:11,898
bribing people to move over to them during last cycle.

1180
01:19:12,298 --> 01:19:15,898
And you know, the fees were much lower arguably about, you know,

1181
01:19:15,918 --> 01:19:18,117
their decentralization and their consensus is different.

1182
01:19:19,077 --> 01:19:21,438
But eventually like there was a moment that, you know,

1183
01:19:21,438 --> 01:19:23,638
there was decent amount of liquidity growing over there,

1184
01:19:23,758 --> 01:19:25,278
but then eventually it evaporated.

1185
01:19:25,438 --> 01:19:29,197
And I assume it's because the network effect of Ethereum was just so much

1186
01:19:29,197 --> 01:19:33,758
stronger and greater that you might temporarily bribe people to move on to your,

1187
01:19:33,957 --> 01:19:35,717
you know, whatever, faster, cheaper, better network.

1188
01:19:35,717 --> 01:19:39,597
But if it doesn't have that stickiness of the,

1189
01:19:39,877 --> 01:19:41,877
of the liquidity then eventually a dry up.

1190
01:19:41,877 --> 01:19:44,918
But I don't think this will be a problem for Bitcoin because here the monetary

1191
01:19:44,918 --> 01:19:48,097
asset has more of a network effect,

1192
01:19:48,097 --> 01:19:49,737
even if it's not in the casino aspect,

1193
01:19:49,977 --> 01:19:54,018
the fact that it's a better network effect for money might be enough for

1194
01:19:54,038 --> 01:19:58,617
liquidity to eventually grow and actually be sticky over the longer term.

1195
01:20:00,517 --> 01:20:05,117
Well, I mean, we all hope so, but it is true that, you know,

1196
01:20:05,117 --> 01:20:09,197
Ethereum has a lot of users, has a lot of fee paying users,

1197
01:20:09,197 --> 01:20:10,437
has a lot of activity.

1198
01:20:11,037 --> 01:20:16,037
It has a lot going forward in terms of not like a top down

1199
01:20:17,197 --> 01:20:19,517
intelligentsia, but it has a lot of actual,

1200
01:20:20,917 --> 01:20:23,757
it just has a lot of actual people who are, who are excited about it.

1201
01:20:23,757 --> 01:20:27,396
And of course Bitcoin obviously does as well. But the problem is,

1202
01:20:28,396 --> 01:20:33,397
in Bitcoin we have, you know, sort of been lying to ourselves.

1203
01:20:33,397 --> 01:20:36,557
I mean, this is the BIP300 or drivechain.

1204
01:20:36,557 --> 01:20:40,276
It really would have been a much better idea back in 2015 when I first proposed

1205
01:20:40,276 --> 01:20:44,917
it. When Ethereum was still a complete, complete pile of junk,

1206
01:20:45,636 --> 01:20:49,237
that would have been much better. We would have had all this stuff on Bitcoin,

1207
01:20:49,397 --> 01:20:50,557
you know, a long time ago,

1208
01:20:50,557 --> 01:20:53,956
and there probably wouldn't have been a big Ethereum network effect.

1209
01:20:54,757 --> 01:20:59,517
And now as Ethereum gets better, we just have more sour grapes,

1210
01:20:59,517 --> 01:21:01,757
I think, where we just say, Oh, we never wanted that. Anyway,

1211
01:21:01,757 --> 01:21:05,716
we have the Jock Mozuka slide or whatever. We say,

1212
01:21:07,197 --> 01:21:10,877
every other idea is not good. And,

1213
01:21:11,637 --> 01:21:16,637
and so I'm not sure. I think our culture is much weaker,

1214
01:21:17,036 --> 01:21:21,036
I think actually than the Ethereum culture, believe it or not.

1215
01:21:24,957 --> 01:21:26,197
Yeah, but I'm not really,

1216
01:21:28,356 --> 01:21:32,877
I don't really believe that all these things will play out long term.

1217
01:21:34,716 --> 01:21:38,197
And you just have to look at the market cap numbers.

1218
01:21:38,796 --> 01:21:43,796
Bitcoin has $600 billion of market cap and almost no utility in applications.

1219
01:21:46,036 --> 01:21:50,436
And so even though Ethereum has the strongest network effects,

1220
01:21:50,716 --> 01:21:53,637
both in switching costs, in culture,

1221
01:21:54,277 --> 01:21:57,837
network effects and liquidity, longer term,

1222
01:21:57,837 --> 01:22:02,716
there's a massive incentive to move to Bitcoin because in Bitcoin,

1223
01:22:02,716 --> 01:22:07,556
you have all the capital that is not being used in any applications.

1224
01:22:07,556 --> 01:22:11,436
So if I'm a dev and I'm looking for customers,

1225
01:22:11,877 --> 01:22:16,117
there's $600 billion of potential customers. Why wouldn't I move over?

1226
01:22:16,517 --> 01:22:18,076
And so it's a question of time before,

1227
01:22:18,597 --> 01:22:20,916
basically, yeah,

1228
01:22:21,436 --> 01:22:25,156
the whole ecosystem network effects start on Bitcoin.

1229
01:22:25,716 --> 01:22:28,356
If you build the argument around the market cap though,

1230
01:22:28,356 --> 01:22:32,276
then it's something of a circular reasoning really, because

1231
01:22:34,597 --> 01:22:37,076
I mean, I've seen those market cap numbers change quite a bit.

1232
01:22:37,076 --> 01:22:41,796
I remember when Ethereum had the, you know, one 10,000th the market cap of BTC.

1233
01:22:42,957 --> 01:22:47,436
So I've seen those numbers change enormously over the last, whatever, 10 years,

1234
01:22:47,957 --> 01:22:51,757
more. So, you know,

1235
01:22:51,757 --> 01:22:56,317
and once the day of the Dow hack or whatever Ethereum fell like 66% or something

1236
01:22:56,317 --> 01:22:57,156
like that. So,

1237
01:22:57,436 --> 01:23:01,877
so I hope that everyone is right about all this and that none of it matters.

1238
01:23:03,477 --> 01:23:07,356
I gave you a little speech just a moment ago about how if they all have equal

1239
01:23:07,356 --> 01:23:09,837
features, I think that stigmatizes the number two coin,

1240
01:23:09,877 --> 01:23:13,276
makes it really difficult for it to succeed. So I certainly believe that.

1241
01:23:14,037 --> 01:23:15,636
Certainly hope it won't be an issue,

1242
01:23:16,196 --> 01:23:21,156
but I wouldn't build it all on the market cap because the market

1243
01:23:21,156 --> 01:23:25,757
cap, I have seen the Bitcoin market cap get cut in half in a

1244
01:23:25,757 --> 01:23:27,916
day, several times.

1245
01:23:28,356 --> 01:23:31,877
I've seen Ethereum fall by two thirds in a day at one time.

1246
01:23:33,117 --> 01:23:37,156
I've seen quite a bit of stuff happen. And the market,

1247
01:23:37,436 --> 01:23:40,877
the market cap is mostly it's circular reasoning itself,

1248
01:23:40,877 --> 01:23:45,436
because I think it's a people speculating on future ability to

1249
01:23:45,436 --> 01:23:47,677
spend the coin future utility of the coin.

1250
01:23:48,156 --> 01:23:49,877
So it's inherently very speculative.

1251
01:23:50,837 --> 01:23:55,556
And so the people's expectations of the future can change like in an

1252
01:23:55,556 --> 01:23:56,397
instant.

1253
01:24:00,436 --> 01:24:04,837
As far as like Bitcoin's culture being weaker than,

1254
01:24:04,916 --> 01:24:08,877
than Ethereum's, I think that maybe in utility and like casino wise,

1255
01:24:09,156 --> 01:24:12,757
Ethereum might have like a stronger culture or utility and whatever.

1256
01:24:13,037 --> 01:24:17,517
But as far as like a base layer money I think Bitcoin's culture is,

1257
01:24:17,756 --> 01:24:21,237
you know, probably way stronger. But like, like you said,

1258
01:24:21,237 --> 01:24:23,557
who knows what the future will hold, but, but you know,

1259
01:24:23,957 --> 01:24:26,036
I think Ethereum's culture is terrible,

1260
01:24:26,076 --> 01:24:30,957
but I think that Bitcoin's has gone from being okay

1261
01:24:30,957 --> 01:24:34,596
to even worse. We, I think we really

1262
01:24:36,117 --> 01:24:36,756
you know, what,

1263
01:24:36,756 --> 01:24:39,476
what made Ethereum's culture bad was when it was talking about being world

1264
01:24:39,476 --> 01:24:43,277
computer and, and blah, blah, blah, saving the planet.

1265
01:24:43,916 --> 01:24:46,036
It said all this, this, this big stuff.

1266
01:24:47,076 --> 01:24:51,356
So it's the big cock and not being serious about getting things done.

1267
01:24:51,356 --> 01:24:53,437
But now we are the ones who do the big talk.

1268
01:24:54,277 --> 01:24:56,356
We have this grandiose nonsense that

1269
01:24:58,397 --> 01:25:03,397
we're lying to ourselves about the details don't add up yet,

1270
01:25:03,517 --> 01:25:05,277
but they're very close, but not yet.

1271
01:25:06,316 --> 01:25:09,076
Not until B300 activates, then it'll all be,

1272
01:25:09,076 --> 01:25:10,356
then it'll go back to being perfect.

1273
01:25:16,876 --> 01:25:20,837
It's about the self deception though, just to be clear. That's what it is.

1274
01:25:22,957 --> 01:25:25,717
Cause once you have, once people can't be honest,

1275
01:25:25,837 --> 01:25:30,677
then there's no recovery. So,

1276
01:25:31,277 --> 01:25:35,277
and it was very different 2012, 2014, it was very different people, you know,

1277
01:25:36,677 --> 01:25:37,517
it was just,

1278
01:25:37,596 --> 01:25:42,596
you go back and read bitcointalk.org and just read what it was like in 2012,

1279
01:25:43,717 --> 01:25:47,636
2014, that type of a thing 10 years ago. And it was, uh,

1280
01:25:49,476 --> 01:25:53,916
and I think the Twitter algorithm is also screwing us to some extent.

1281
01:25:54,036 --> 01:25:57,076
Anyway, we have some other people up here. They are. Hello.

1282
01:25:58,356 --> 01:25:59,677
Crypto conversion.

1283
01:26:01,557 --> 01:26:05,316
Yeah. Um, I just wanted to, um, just on this discussion of,

1284
01:26:05,316 --> 01:26:08,916
of the culture and you know, market cap versus, um, fee,

1285
01:26:10,397 --> 01:26:13,596
fees paid and things like that. I, I do think, um, you know, I,

1286
01:26:13,596 --> 01:26:17,397
I just, I agree that, uh, market cap isn't a good indicator and that,

1287
01:26:17,397 --> 01:26:20,677
and that's, that's, that's a, that's a, that's a good indicator.

1288
01:26:20,677 --> 01:26:24,517
I agree that a market cap isn't a good indicator and that, um,

1289
01:26:24,557 --> 01:26:28,717
people aren't building, uh, again, the culture of Bitcoin. There's so,

1290
01:26:28,717 --> 01:26:32,437
I think so much of that market cap is people who are, you know,

1291
01:26:32,596 --> 01:26:37,316
never going to spend any other Bitcoin, right. That's, that is the, um, I,

1292
01:26:37,636 --> 01:26:41,316
maybe the predominant Bitcoin culture is, um, you know, hold your keys,

1293
01:26:41,316 --> 01:26:45,916
hold your crypto, uh, or whatever, hold, hold your Bitcoin cold storage, um,

1294
01:26:46,036 --> 01:26:49,076
you know, save it for the rest of your life and then, you know, you'll,

1295
01:26:49,076 --> 01:26:53,756
you'll be rich. Right. And so I, I think we definitely need to see, um, you know,

1296
01:26:53,796 --> 01:26:58,076
the start of a culture shift, um, that we are willing to pay fees.

1297
01:26:58,076 --> 01:27:02,157
We are willing to use applications and then all those applications will be

1298
01:27:02,157 --> 01:27:04,397
built and then we'll have, um, you know,

1299
01:27:04,397 --> 01:27:07,756
we'll we have to have that kind of culture shift before we, um,

1300
01:27:07,796 --> 01:27:10,636
can overtake a theory of whose culture is, um,

1301
01:27:10,717 --> 01:27:13,957
I'm using apps whether or not to make money or, you know,

1302
01:27:13,957 --> 01:27:17,036
identity apps or things like that. But, um, you know, I am,

1303
01:27:17,677 --> 01:27:20,196
I have a theorem so that I can use it. Um,

1304
01:27:22,957 --> 01:27:27,957
I completely agree that if you had gone back in time to the 2012,

1305
01:27:28,796 --> 01:27:33,596
2014 era, I think this is all because of the scale, the scaling war,

1306
01:27:33,596 --> 01:27:36,796
split the medium of exchange and store value groups.

1307
01:27:38,397 --> 01:27:41,636
Previously they were absolutely the same group and people imagined.

1308
01:27:41,837 --> 01:27:45,076
I guess is that people would have actually imagined something that is much more

1309
01:27:45,117 --> 01:27:49,237
like bit VM. If you went back to 2012,

1310
01:27:50,356 --> 01:27:52,117
everyone would think, wow, this is going to be crazy.

1311
01:27:52,117 --> 01:27:54,356
I'm going to go online and I'm not going to,

1312
01:27:54,356 --> 01:27:57,677
I'm going to be in the anonymous internet and I'm going to pay for like my VPN

1313
01:27:57,677 --> 01:28:00,596
with Bitcoin and I'm going to pay for like my whatever, you know,

1314
01:28:00,596 --> 01:28:04,717
my drugs or something with Bitcoin and my prostitutes and I'm going to have

1315
01:28:04,717 --> 01:28:08,916
magic encrypted files on the internet and I'm going to play against,

1316
01:28:08,957 --> 01:28:13,957
I'm going to play chess against someone and cryptography is going to guarantee

1317
01:28:14,356 --> 01:28:17,677
that the winner of the chess game gets something and we can have people,

1318
01:28:17,677 --> 01:28:18,517
we'll have people meet.

1319
01:28:19,277 --> 01:28:23,957
It'd be like the fast and the furious where they all meet on the one road to

1320
01:28:23,957 --> 01:28:24,796
race and they were like,

1321
01:28:24,796 --> 01:28:29,117
we'll have like cryptographic like chat rooms and stuff and like there'll be a

1322
01:28:29,117 --> 01:28:33,917
spam resistant email. People were talking a lot about using it a lot.

1323
01:28:34,957 --> 01:28:37,556
And we had bit pay. We were like, Oh, bit pay.

1324
01:28:38,236 --> 01:28:41,116
It's exactly like a credit card except much cheaper.

1325
01:28:41,116 --> 01:28:44,876
It's a better deal for the merchant, the user, you know, the customer,

1326
01:28:44,876 --> 01:28:47,717
they get cash the next day. Bit pay was big.

1327
01:28:48,277 --> 01:28:51,957
It was a big idea and just to have this cool little logo and it was just like a

1328
01:28:51,957 --> 01:28:55,076
visa. You could like have a little sticker at your,

1329
01:28:55,917 --> 01:29:00,917
at your store and it was really about using it as much as it was about people

1330
01:29:02,357 --> 01:29:05,037
talking about, Hey, this, the properties of money are way better.

1331
01:29:05,236 --> 01:29:07,756
We have 21 million coins only. There's no inflation.

1332
01:29:07,797 --> 01:29:12,316
There's totally predictable monetary policy. There's no ambiguity. You,

1333
01:29:12,477 --> 01:29:14,397
you always know exactly. Unlike gold,

1334
01:29:14,837 --> 01:29:16,756
you always know exactly how much Bitcoin you have.

1335
01:29:17,556 --> 01:29:21,196
So people talked about the store of value stuff, of course,

1336
01:29:21,957 --> 01:29:24,917
but they also talked about the medium of exchange. And this is why I,

1337
01:29:25,436 --> 01:29:26,636
I repeat this a lot,

1338
01:29:26,636 --> 01:29:31,196
but I really believe it that the scaling war screwed everything up in Bitcoin

1339
01:29:31,196 --> 01:29:32,037
because

1340
01:29:32,996 --> 01:29:37,636
now we, we get to a point where people would, there are people who will say,

1341
01:29:39,556 --> 01:29:44,236
um, you know, they'll say, we don't even want to use Bitcoin.

1342
01:29:44,277 --> 01:29:48,957
Using Bitcoin is bad. And, uh, in fact, if we, if we use it too much, it might,

1343
01:29:48,996 --> 01:29:49,876
it might, you know,

1344
01:29:49,917 --> 01:29:52,797
it might make it harder for BlackRock to get the ETF or something.

1345
01:29:52,957 --> 01:29:56,037
And if you had said that in, in 2012,

1346
01:29:56,397 --> 01:29:58,717
person's head would have just exploded. They would have said,

1347
01:29:58,996 --> 01:30:03,357
who fucking cares about that? And, uh, so, I mean, yeah,

1348
01:30:03,357 --> 01:30:06,717
it's important. Adoption is good. Investment is good.

1349
01:30:06,756 --> 01:30:10,597
High market cap is good. BlackRock ETF. That's, that's good.

1350
01:30:11,597 --> 01:30:15,316
But I just don't, I just don't get it. You know, really there would be,

1351
01:30:15,357 --> 01:30:20,277
you know, the cypherpunk future has departed almost completely.

1352
01:30:20,636 --> 01:30:23,037
Cause the cypherpunk future was like, you know,

1353
01:30:23,037 --> 01:30:25,717
magic file storage and stuff like that.

1354
01:30:25,957 --> 01:30:30,957
So now it's considered very fashionable to reject all of that and say,

1355
01:30:31,477 --> 01:30:33,876
we don't want application.

1356
01:30:33,876 --> 01:30:35,957
That part of this is the sour grapes that I mentioned before.

1357
01:30:35,957 --> 01:30:40,397
This is a really sad thing is that it's because other coins like Ethereum and

1358
01:30:40,397 --> 01:30:43,157
other stuff, Filecoin or whatever,

1359
01:30:44,196 --> 01:30:46,037
because they have moved into that territory.

1360
01:30:46,037 --> 01:30:49,196
Now the Bitcoin culture has to say, is forced to say,

1361
01:30:49,676 --> 01:30:53,477
we're holding a gun to ourselves. And we're not going to let that happen.

1362
01:30:53,517 --> 01:30:56,717
We're holding a gun to ourselves and we say, well,

1363
01:30:57,436 --> 01:31:02,076
we never really wanted that anyway. That's just, um, that's just a scam.

1364
01:31:03,316 --> 01:31:07,157
And, uh, yeah, that's not good. That's why it's a big problem.

1365
01:31:07,876 --> 01:31:09,236
Yeah. I, but I,

1366
01:31:09,236 --> 01:31:13,676
I do think there's something in addition to just a medium of exchange, um,

1367
01:31:13,756 --> 01:31:17,996
that we have to get in people's mind, right on Ethereum. Um, you know,

1368
01:31:17,996 --> 01:31:23,116
it's not that people think ether is, uh, a good money or, you know,

1369
01:31:23,236 --> 01:31:25,876
it's something that they want to maximize.

1370
01:31:25,996 --> 01:31:30,436
There are plenty of people on Ethereum who, you know, it's simply the gas.

1371
01:31:30,436 --> 01:31:33,357
It's simply the, you know, um, it's, it's the,

1372
01:31:33,357 --> 01:31:36,797
the means to get what they want. They hold a little bit of ether, but they're,

1373
01:31:36,996 --> 01:31:40,477
you know, they're in tokens, they're in NFTs, they're, um, you know,

1374
01:31:40,517 --> 01:31:44,316
they're doing identity stuff with ENS and they're, you know,

1375
01:31:44,556 --> 01:31:49,477
more about that and building that out. And then, um, you know, the ether, right.

1376
01:31:49,717 --> 01:31:54,517
I could imagine if lightning scaled perfectly in Bitcoin was used as,

1377
01:31:54,876 --> 01:31:57,996
you know, a store of value and a medium of exchange. It's still,

1378
01:31:57,996 --> 01:32:02,436
unless people can wrap their heads around it being, you know, gas and,

1379
01:32:02,436 --> 01:32:06,676
and having, um, I, I don't know if this makes sense,

1380
01:32:06,676 --> 01:32:10,436
or maybe it is simply a medium of exchange and they're paying the fee to do

1381
01:32:10,436 --> 01:32:12,996
these things. But, um, I, I don't know, I, in my head,

1382
01:32:12,996 --> 01:32:17,436
it seems like it's an additional property of this like utility in order to

1383
01:32:17,436 --> 01:32:22,436
access these things. I have to have and use, um, Bitcoin to do so.

1384
01:32:24,917 --> 01:32:29,917
Yes. This is a very important point that people often claim that ordinals spam

1385
01:32:30,556 --> 01:32:31,397
the blockchain.

1386
01:32:32,957 --> 01:32:36,676
I just want to say I don't own any ordinals at all or inscriptions or whatever,

1387
01:32:36,717 --> 01:32:41,397
but I'm going to defend them slightly because they say that there's no,

1388
01:32:41,837 --> 01:32:45,236
it takes a block space that should instead be used for transactions,

1389
01:32:46,236 --> 01:32:51,236
but that's not true because the ordinals inscription thing is a transaction.

1390
01:32:51,236 --> 01:32:56,236
It is, it pays the transaction fee to the miner and it is a,

1391
01:32:56,996 --> 01:33:01,316
it is a transaction. So it's not the transaction you want,

1392
01:33:02,037 --> 01:33:06,797
but it is something. And as a result,

1393
01:33:06,797 --> 01:33:10,436
it, uh, they bid for the block space they pay the most.

1394
01:33:10,676 --> 01:33:15,277
So they're the rightful owner. And yeah, it just goes to this,

1395
01:33:15,277 --> 01:33:18,917
like this, but I think this is the scaling thing about how, um,

1396
01:33:19,597 --> 01:33:21,157
payments was de-emphasized.

1397
01:33:21,196 --> 01:33:26,196
It was originally a big emphasis was payments and now it's been de-emphasized.

1398
01:33:26,876 --> 01:33:31,397
So it used to be like removing, we thought, I can't believe we have to compete

1399
01:33:31,397 --> 01:33:35,397
with Western union, which is like charges 15% or something.

1400
01:33:35,397 --> 01:33:38,236
It charges a fortune. We were just like, we're going to,

1401
01:33:39,116 --> 01:33:42,196
this is going to be no problem. And, you know, payment,

1402
01:33:42,196 --> 01:33:47,196
we all make payments multiple times a day, but yeah,

1403
01:33:47,436 --> 01:33:48,277
this was a,

1404
01:33:48,837 --> 01:33:53,076
the scaling war really through a giant wrench in all of this. Not because,

1405
01:33:53,636 --> 01:33:57,477
you know, the correct side one, but that's not the point.

1406
01:33:58,157 --> 01:34:03,157
We're really both sides lost because the community split and then each side

1407
01:34:03,157 --> 01:34:05,157
became obsessed with only it's one thing

1408
01:34:05,157 --> 01:34:10,157
when both were, or both are needed or really what's really needed is just the,

1409
01:34:10,157 --> 01:34:15,157
the ability to be honest with yourself about things that you want.

1410
01:34:17,076 --> 01:34:21,636
So like in Bitcoin, we actually, we want payments, we want scalability,

1411
01:34:21,636 --> 01:34:24,076
we want a smart contracts, but we were often,

1412
01:34:24,196 --> 01:34:26,917
often we lie to ourselves about, about that fact.

1413
01:34:27,996 --> 01:34:30,957
You know, I think, I think there was another thing as well that,

1414
01:34:31,076 --> 01:34:34,076
that contributed, not just the scaling war. Um,

1415
01:34:34,116 --> 01:34:35,837
and from my experience early on, there was,

1416
01:34:35,876 --> 01:34:40,876
it was a pro exploration and a pro innovation and like it was a pro learn about

1417
01:34:41,157 --> 01:34:44,357
the other protocols and try them out and, you know, understand them.

1418
01:34:44,357 --> 01:34:46,917
And if they are good, you know, Bitcoin will eventually adopt it.

1419
01:34:47,236 --> 01:34:49,556
I remember that, that culture early on. Um,

1420
01:34:49,837 --> 01:34:52,236
but then there was also the, the Hal Finney's that would say, you know,

1421
01:34:52,236 --> 01:34:55,876
the base layer really doesn't scale on, you know, in its current form. Right.

1422
01:34:56,676 --> 01:35:01,676
With his famous post saying that it's going to be as rare today in the future

1423
01:35:01,797 --> 01:35:03,477
as, as a Bitcoin transaction today. Right.

1424
01:35:03,477 --> 01:35:08,116
So he already saw that, um, the, the, the scaling limitations and, um, you know,

1425
01:35:08,116 --> 01:35:11,357
other layers that would actually be doing the medium of exchange and things like

1426
01:35:11,357 --> 01:35:14,477
that. But I, I think that the, the, what really ha what,

1427
01:35:14,477 --> 01:35:17,116
another thing that happened is during maybe, um, you know,

1428
01:35:17,116 --> 01:35:20,316
old coin booms or ICO booms and things like this, it was,

1429
01:35:20,357 --> 01:35:24,676
there was a defense mechanism where Bitcoiners would try to protect newcomers

1430
01:35:24,676 --> 01:35:28,196
because obviously during new cycles, there is an influx of new people.

1431
01:35:28,517 --> 01:35:29,517
And the new people,

1432
01:35:29,517 --> 01:35:33,676
they don't really understand the actual inner workings of the protocols and

1433
01:35:33,676 --> 01:35:35,076
they're very prone to getting scammed.

1434
01:35:35,316 --> 01:35:38,316
So it was a lot easier to protect them by just calling everything a scam

1435
01:35:38,876 --> 01:35:41,196
outright. Right. And like, because, you know,

1436
01:35:41,196 --> 01:35:44,436
obviously you're protecting them from 99.99% that are scams.

1437
01:35:44,756 --> 01:35:48,917
And I feel like it was because of this defense mechanism that was shunning

1438
01:35:48,917 --> 01:35:52,157
everybody away from everything else to protect them rightfully so.

1439
01:35:52,397 --> 01:35:55,756
But at the same time, it eventually became too strong where, you know,

1440
01:35:55,797 --> 01:35:58,876
it lost the idea of actually explored. You don't have to invest in it.

1441
01:35:58,876 --> 01:36:00,556
You don't have to buy it. Don't fall for the marketing,

1442
01:36:00,756 --> 01:36:02,037
but explore it and learn about it.

1443
01:36:02,277 --> 01:36:05,157
And I think that that part kind of got lost, you know,

1444
01:36:05,277 --> 01:36:08,157
over the years because of the defense mechanism.

1445
01:36:11,196 --> 01:36:15,517
I definitely agree with the history, you know, tracking where we lost this.

1446
01:36:15,717 --> 01:36:18,876
Um, but then Paul, I liked that you mentioned, um, ordinals.

1447
01:36:18,876 --> 01:36:23,436
I do think that is hopeful for the future that it seemed like when that came

1448
01:36:23,436 --> 01:36:26,517
out, you know, even though whatever, you know,

1449
01:36:26,517 --> 01:36:29,996
maybe they were inefficient and expensive. Um, just the number,

1450
01:36:29,996 --> 01:36:33,597
the fact that so many of those things got minted, it pulled, um, you know,

1451
01:36:33,597 --> 01:36:38,277
a number of people from Ethereum, they have a back into Bitcoin, um,

1452
01:36:38,357 --> 01:36:42,397
you know, that they, uh, so, so definitely I am hopeful for, um,

1453
01:36:42,597 --> 01:36:47,236
one of these scaling solutions, one of these side, sidechain solutions. Um,

1454
01:36:47,636 --> 01:36:52,876
I I'm hopeful that one of them can, you know, lead us to, to, uh,

1455
01:36:52,996 --> 01:36:57,556
you know, take more of that, um, more of what Ethereum has right now. Um,

1456
01:36:57,556 --> 01:37:02,076
and, and, you know, maybe one day make it obsolete. Um, and so anyway, that,

1457
01:37:02,116 --> 01:37:05,356
that's it for me. Just wanted to talk about that debate. Thanks guys.

1458
01:37:06,756 --> 01:37:11,716
Yeah, no, absolutely. I agree. I think I'll be, be more optimistic.

1459
01:37:11,797 --> 01:37:15,917
I think what's next for Bitcoin is minimum of exchange.

1460
01:37:16,756 --> 01:37:18,756
I think I really believe in,

1461
01:37:18,756 --> 01:37:22,437
there was this one chart called the evolution of Bitcoin that said it would go

1462
01:37:22,476 --> 01:37:27,557
from a digital collectible to store of value to medium of exchange

1463
01:37:27,677 --> 01:37:30,716
to a unit of account. Um,

1464
01:37:30,797 --> 01:37:33,037
I just posted on my Twitter as well,

1465
01:37:33,037 --> 01:37:35,756
if you want to see which graph I'm talking about,

1466
01:37:36,037 --> 01:37:38,716
but I think during the scaling war, um,

1467
01:37:38,797 --> 01:37:43,517
you've optimized for store of value. I think last bull run,

1468
01:37:43,517 --> 01:37:46,636
we've seen everyone in the world talk about digital gold,

1469
01:37:46,756 --> 01:37:49,277
like it achieved that status in people's minds.

1470
01:37:49,917 --> 01:37:52,157
And I think what's going to happen next bull run,

1471
01:37:52,636 --> 01:37:56,517
we'll have a botanics with a, uh,

1472
01:37:56,557 --> 01:37:58,956
with a sidechain, there will be a bunch of different sections.

1473
01:37:58,956 --> 01:38:03,397
And I actually think we'll see a massive increase of adoption of depths, uh,

1474
01:38:03,437 --> 01:38:06,236
back on Bitcoin. And that's, I think where, uh,

1475
01:38:06,277 --> 01:38:10,836
Bitcoin as a medium of exchange, um, starts to play way more role.

1476
01:38:11,797 --> 01:38:14,157
Um, and that's, I think in the, in the depth world of things,

1477
01:38:14,157 --> 01:38:17,956
but also in the macroeconomic, uh, type of things,

1478
01:38:18,277 --> 01:38:21,996
countries will start transacting way more in, uh, in Bitcoin.

1479
01:38:22,397 --> 01:38:26,836
Like the more people get thrown off Swift, the more, um,

1480
01:38:26,876 --> 01:38:31,397
Bitcoin rails will, will be used. And so I think the minimum of exchange,

1481
01:38:31,677 --> 01:38:34,876
we haven't seen it play out yet, but I think it will, uh,

1482
01:38:35,116 --> 01:38:39,756
come way faster than we all expect. Um, just to give everyone a,

1483
01:38:40,437 --> 01:38:41,876
um, an expectation here.

1484
01:38:42,476 --> 01:38:45,636
Once you have an EVM that's fully equivalent on Bitcoin,

1485
01:38:46,236 --> 01:38:51,236
it takes you a day to copy any application that you have on Ethereum and

1486
01:38:53,037 --> 01:38:55,917
deploy it on Bitcoin. Um,

1487
01:38:55,996 --> 01:39:00,996
and so I think the changeover will be way faster than a lot of people expect.

1488
01:39:02,116 --> 01:39:02,236
Yeah.

1489
01:39:02,236 --> 01:39:05,437
Initially it will go slow because you have the massive liquidity effects.

1490
01:39:05,876 --> 01:39:10,037
But after that, I think, uh, um, a lot more people will, uh,

1491
01:39:10,157 --> 01:39:13,356
will come back and the battles will be, um,

1492
01:39:13,356 --> 01:39:17,356
between different sidechains and basically you'll see an explosion of side

1493
01:39:17,356 --> 01:39:19,716
chains. I think as, as Robin mentioned,

1494
01:39:19,716 --> 01:39:24,356
like the tools are being laid out right now. Um, and over the next years,

1495
01:39:24,356 --> 01:39:25,836
I think, um,

1496
01:39:25,876 --> 01:39:30,116
development on sidechains and on Bitcoin main later and applications will just

1497
01:39:30,517 --> 01:39:32,836
explode. Um, and then explore them.

1498
01:39:33,197 --> 01:39:34,037
Okay.

1499
01:39:41,397 --> 01:39:43,317
Paul, can I ask a question?

1500
01:39:44,596 --> 01:39:45,437
Yes, of course.

1501
01:39:47,197 --> 01:39:50,677
Uh, first, uh, just a quick comment with respect to ordinals.

1502
01:39:50,677 --> 01:39:52,356
It reminds me a lot of, uh,

1503
01:39:52,756 --> 01:39:55,476
I don't know if you remember when Satoshi dice was popular,

1504
01:39:55,476 --> 01:39:59,356
people were making the same arguments that Satoshi dice was spamming the

1505
01:39:59,356 --> 01:40:00,197
blockchain.

1506
01:40:03,138 --> 01:40:04,138
Okay.

1507
01:40:04,138 --> 01:40:13,138
Um, my other question, I've been following you for a long, long time, like over a decade.

1508
01:40:13,138 --> 01:40:19,138
Um, and I sort of, um, I don't know, sort of checked out of the community for a while.

1509
01:40:19,138 --> 01:40:31,138
Um, and I just wanted to know what your thoughts are. You don't have to answer the question if you've covered it elsewhere, if you've covered it today, but there seems to be like, you know, the small block or argument and then, or the hell Finney argument.

1510
01:40:32,138 --> 01:40:41,138
Or the hell Finney position versus the Satoshi position where Satoshi, uh, said that, you know, Bitcoin never hit, hit a scaling ceiling.

1511
01:40:41,138 --> 01:40:48,138
He mentioned that, uh, nodes and miners were the same thing and that there would be large server farms.

1512
01:40:48,138 --> 01:40:56,138
Um, so he, he, or she, or they, or whatever envisioned Bitcoin scaling on chain.

1513
01:40:56,138 --> 01:41:01,138
And from what I'm hearing from you is you don't feel that way.

1514
01:41:01,138 --> 01:41:02,138
Is that right?

1515
01:41:02,138 --> 01:41:03,138
And if so, why not?

1516
01:41:03,138 --> 01:41:04,138
Thank you.

1517
01:41:05,138 --> 01:41:06,138
Sure.

1518
01:41:06,138 --> 01:41:07,138
Yes.

1519
01:41:07,138 --> 01:41:08,138
They said that about Satoshi dice.

1520
01:41:08,138 --> 01:41:17,138
Um, but what they didn't say as loudly, but Eric Voorhees replied, Eric Voorhees was like the inventor of Satoshi dice or whatever.

1521
01:41:17,138 --> 01:41:21,138
And that was the place where we could, you would send a Bitcoin somewhere.

1522
01:41:21,138 --> 01:41:27,138
And then if you based on the source of randomness, that was like the block cast or something.

1523
01:41:27,138 --> 01:41:36,138
You could win money and they send the coins back to you and it was all happening on chain and it involved a lot of spam on the blockchain.

1524
01:41:36,138 --> 01:41:57,138
But Satoshi dice had actually paid more fees total, not only per each transaction, you know, not enough, not only enough to outbid, but Satoshi dice, the entity had paid at one point more transaction fees total than had been paid in the entire history of Bitcoin.

1525
01:41:58,138 --> 01:42:09,138
So that was a very interesting, um, phenomenon, but, uh, yeah, so this question has been, has come up many, many, many times.

1526
01:42:09,138 --> 01:42:20,138
So if you, if you really want to know in depth, my view, I wrote in September, 2015, this post measuring decentralization, where I say that it is problematic.

1527
01:42:20,138 --> 01:42:24,138
The more expensive a full note is, but I have a giant essay about that.

1528
01:42:25,138 --> 01:42:29,138
And then I wrote an essay called a thunder, which is about scaling with sidechains.

1529
01:42:29,138 --> 01:42:31,138
It's a little joke of mine.

1530
01:42:31,138 --> 01:42:41,138
And I explained in detail why, uh, this is different from naive L1 large block ism.

1531
01:42:41,138 --> 01:42:50,138
And it allows us to basically have our cake and eat it too, which is to say you could get large blocks and use them for payments if you want.

1532
01:42:51,138 --> 01:42:58,138
But the entire network doesn't have to come along with you enough to risk the entire L1 on that.

1533
01:42:59,138 --> 01:43:07,138
And we don't, um, it's only optional to utilize the extra box space.

1534
01:43:07,138 --> 01:43:17,138
But yeah, Satoshi seemed to really think that it didn't matter very much that the, uh, he thought that full node costs my, he thought that every miner had to run a full node.

1535
01:43:17,138 --> 01:43:20,138
This is, I think where I would probably disagree with him.

1536
01:43:21,138 --> 01:43:23,138
Really miners never run a full node.

1537
01:43:23,138 --> 01:43:34,138
So I think that the irony though, is that there seems to be like, if you can draw like a grid and there's like four different groups that all seem to believe different things.

1538
01:43:35,138 --> 01:43:46,138
So I think original Satoshi, he thought that miners always had to run nodes and that's like the Bitcoin SV position now.

1539
01:43:47,138 --> 01:43:56,138
And then, um, there's other people who say that, I mean, I say miners never need to run nodes, but that running nodes is the important thing.

1540
01:43:57,138 --> 01:43:59,138
Other people will say that it's, it doesn't matter.

1541
01:44:00,138 --> 01:44:02,138
There is no such thing as running a node without being a miner.

1542
01:44:02,138 --> 01:44:17,138
So that's where this, but it's kind of a bizarre, um, little, uh, it's a bizarre little grid of, of who thinks what, but my answer is it doesn't really matter because we can have both of the two options.

1543
01:44:18,138 --> 01:44:21,138
It was small block L1, large block L2 optional.

1544
01:44:22,138 --> 01:44:24,138
Now, anyone who wanted L2, they could do that.

1545
01:44:25,138 --> 01:44:29,138
Anyone who wanted L1, um, they do that.

1546
01:44:29,138 --> 01:44:43,138
And so, uh, so it's a moot point really, but it's clearly, clearly Satoshi began as a large blocker and then it's like an infinite block size blocker.

1547
01:44:44,138 --> 01:44:48,138
And then he, he was the one who himself inserted the one megabyte block size limit.

1548
01:44:49,138 --> 01:44:51,138
I think it was in July, 2010, something like that.

1549
01:44:52,138 --> 01:44:58,138
Um, so he, he did that and then he left without, he described it.

1550
01:44:59,138 --> 01:45:13,138
We could phase it out later, but even though he had things that phased out, like he had difficulty adjustment and he had the, um, the having every four years, he didn't put any of that in.

1551
01:45:14,138 --> 01:45:18,138
He kind of knew that he had kind of left it that way.

1552
01:45:18,138 --> 01:45:22,138
So he, so he put that in, so he had become kind of a small blocker.

1553
01:45:24,138 --> 01:45:28,138
I think the original design I think was, was unlimited block size.

1554
01:45:29,138 --> 01:45:42,138
I think, you know, like, I'm not sure, but he's, cause he seemed to be obsessed with like the Merkle tree and it had like log two and like log N, um, it had like log N SPV properties.

1555
01:45:42,138 --> 01:45:48,138
And he thought that if miners can't mine a block, they won't know whose block is valid or not unless they run a node.

1556
01:45:51,138 --> 01:45:52,138
Hopefully this is answering some of your question.

1557
01:45:54,138 --> 01:45:57,138
Just when you said that anyone who wants a large L1 can have that.

1558
01:45:58,138 --> 01:46:00,138
Do you mean, uh, by using,

1559
01:46:02,138 --> 01:46:05,138
Yeah, he used large rock L2 by using a sidechain, sidechain and Bitcoin.

1560
01:46:06,138 --> 01:46:23,138
And in terms of like, I find that people talk about decentralization a lot, but I, you know, decentralization is merely a means to an end and the end is actually censorship, censorship resistance.

1561
01:46:24,138 --> 01:46:32,138
And for me, it becomes like an economic question as to how many nodes or how much decentralization do you need?

1562
01:46:32,138 --> 01:46:33,138
But it's not the quantity of nodes.

1563
01:46:34,138 --> 01:46:39,138
I talk about this in the essay measuring decentralization and it's not the quantity of nodes.

1564
01:46:40,138 --> 01:46:43,138
It is the, how expensive it is to spin up a new node.

1565
01:46:44,138 --> 01:46:46,138
This is the cost of the cell dividing basically.

1566
01:46:47,138 --> 01:46:54,138
If the, how, how easily can we get all the nodes back or start up a new node and look into the blockchain ourselves.

1567
01:46:55,138 --> 01:46:56,138
And so that cost must be low.

1568
01:46:56,138 --> 01:47:04,138
But I mean, I, apparently like Tron is decentralized enough to supporting an enormous number of USDT payments or whatever.

1569
01:47:05,138 --> 01:47:11,138
So apparently we already know where the line is and it's slightly different for each person in each particular.

1570
01:47:12,138 --> 01:47:16,138
It's an economic question of allocation of scarce resources.

1571
01:47:17,138 --> 01:47:24,138
And the way I see it is that the block size cap is, you know, it's sort of like central planning.

1572
01:47:25,138 --> 01:47:33,138
It's devs or the community or whoever saying that we know that we need more decentralization.

1573
01:47:34,138 --> 01:47:36,138
Well, I don't think that's correct.

1574
01:47:37,138 --> 01:47:49,138
Well, you're not allowing the market to discover the right block size to balance the medium of exchange utility of Bitcoin with while maintaining censorship resistance.

1575
01:47:50,138 --> 01:47:58,138
And you're choosing or whoever is choosing to forego that medium of exchange utility, which is why you're seeing the things that you're seeing.

1576
01:47:59,138 --> 01:48:06,138
In terms of stagnation of development of BTC as a medium of exchange.

1577
01:48:07,138 --> 01:48:08,138
Well, I think it's not correct.

1578
01:48:09,138 --> 01:48:10,138
I mean, well, there's a part of it.

1579
01:48:11,138 --> 01:48:14,138
There's some truth to it, but not enough.

1580
01:48:15,138 --> 01:48:27,138
But the but what's true about the block size limit, the one megabyte static block size limit is it's unclear exactly how we are supposed to recover from the limit not being met.

1581
01:48:28,138 --> 01:48:30,138
Not being correct.

1582
01:48:31,138 --> 01:48:36,138
So, you know, like if we if the limit is an error, how do we recover from it?

1583
01:48:37,138 --> 01:48:49,138
And that's similarly, as you say, if in the free market, you know, usually if there's someone is opening a restaurant and they do something wrong every single time, people love the restaurant.

1584
01:48:50,138 --> 01:48:51,138
The prices are just too high.

1585
01:48:52,138 --> 01:49:01,138
Or the dishes aren't clean or something, then someone can open a new restaurant next to it, do the thing, do it the right way.

1586
01:49:02,138 --> 01:49:05,138
And it's just a question of barrier sentry and stuff like that.

1587
01:49:06,138 --> 01:49:10,138
So the free market usually has ways of correcting mistakes.

1588
01:49:11,138 --> 01:49:19,138
If someone if someone's wage is wrong or the price or something is wrong or, you know, something's not being constructed the right way, technically.

1589
01:49:20,138 --> 01:49:28,138
And a static one megabyte block size limit, it doesn't really have that feature because it's sort of unclear how are we supposed to get out from under it?

1590
01:49:28,138 --> 01:49:30,138
You know, do we launch a different coin?

1591
01:49:31,138 --> 01:49:32,138
Do we hard fork Bitcoin?

1592
01:49:32,138 --> 01:49:34,138
I think that's what a hard fork is.

1593
01:49:34,138 --> 01:49:41,138
A hard fork is the market taking, you know, taking the issue into its own hands.

1594
01:49:42,138 --> 01:49:43,138
Would you why would you say that, though?

1595
01:49:44,138 --> 01:49:52,138
Because it was reliably hard because a group of people, some people wanted small blocks, some people wanted unbounded blocks.

1596
01:49:52,138 --> 01:49:54,138
And so the community forked.

1597
01:49:54,138 --> 01:49:57,138
And now, you know, we have an obvious split, though.

1598
01:49:57,138 --> 01:50:03,138
It doesn't split the 80 percent of people maybe were indifferent or something, but they all stay on BTC.

1599
01:50:03,138 --> 01:50:06,138
I wish the hard fork enabled competition.

1600
01:50:06,138 --> 01:50:13,138
The hard fork is kind of like the restaurant scenario where it's very, very, very, very difficult to you have very high barriers to entry.

1601
01:50:14,138 --> 01:50:19,138
So the hard fork is feeble as a competitor is not able to compete.

1602
01:50:20,138 --> 01:50:21,138
I wish that it would.

1603
01:50:21,138 --> 01:50:23,138
If it was, then it wouldn't.

1604
01:50:23,138 --> 01:50:24,138
It would be a moot point, right?

1605
01:50:24,138 --> 01:50:29,138
Because it would say, well, no one would complain because you would.

1606
01:50:29,138 --> 01:50:34,138
Let me let me explain to you what I mean when I say, like, if the hard fork was.

1607
01:50:35,138 --> 01:50:38,138
A good way of inspiring competition.

1608
01:50:39,138 --> 01:50:49,138
Then what would always happen would be whenever anyone hard forked, the market cap would be divided into into two equal portions for some tiny amount of time.

1609
01:50:50,138 --> 01:50:55,138
And both of the new projects would get like a new name and like a new ticker symbol, completely new.

1610
01:50:56,138 --> 01:51:00,138
So it really would split from one thing into two different things.

1611
01:51:01,138 --> 01:51:03,138
But that's just not what the hard fork does.

1612
01:51:03,138 --> 01:51:04,138
The hard fork is too weak.

1613
01:51:04,138 --> 01:51:05,138
The hard fork is just.

1614
01:51:06,138 --> 01:51:07,138
A shit coin.

1615
01:51:08,138 --> 01:51:09,138
I mean.

1616
01:51:10,138 --> 01:51:19,138
Yeah, well, I think, you know, I think of the the hard fork as sort of a vestigial organ almost.

1617
01:51:20,138 --> 01:51:30,138
And when the right economic conditions present themselves, that it may have the right, quote, unquote, genetic makeup so that it'll flourish in the future.

1618
01:51:31,138 --> 01:51:45,138
And I think with ordinals, you know, and fees, you know, going really high, I think it woke some people up in terms of how, you know, some people were stacking sats and had very small amounts of sats.

1619
01:51:46,138 --> 01:51:51,138
Maybe were priced out of ever accessing their on chain sats because fees were too high.

1620
01:51:52,138 --> 01:51:54,138
And it may be in the future.

1621
01:51:54,138 --> 01:52:09,138
Look, hypothetically, if you think of some type of thought experiment where BTC fees rise up, you know, a hundred fold, a thousand fold, then all of a sudden these shit coins start to have utility.

1622
01:52:11,138 --> 01:52:15,138
Well, I think also that what gives them utility is that we in Bitcoin, we don't have an answer.

1623
01:52:15,138 --> 01:52:21,138
When someone comes to us, when someone comes and says, listen, I really want to do ring signatures for extra privacy.

1624
01:52:22,138 --> 01:52:24,138
We in Bitcoin, we we have to turn them away.

1625
01:52:25,138 --> 01:52:27,138
We don't give them anything that they can use.

1626
01:52:28,138 --> 01:52:34,138
And as a result, they must launch Monero or whatever.

1627
01:52:34,138 --> 01:52:36,138
So what are we supposed to tell them?

1628
01:52:36,138 --> 01:52:38,138
You know, the developers are going to make something.

1629
01:52:38,138 --> 01:52:39,138
Yeah. What are we supposed to do?

1630
01:52:39,138 --> 01:52:44,138
Jeremy makes CTV and the community drags its feet for five years.

1631
01:52:45,138 --> 01:52:48,138
And so it's either either you just do nothing.

1632
01:52:49,138 --> 01:52:52,138
You're supposed to do nothing with your idea or you have to launch an alt.

1633
01:52:53,138 --> 01:52:54,138
And then we don't we don't.

1634
01:52:55,138 --> 01:53:03,138
It's a similar concept to the what I was telling you about what I was explaining in my point of view about the one megabyte static block is where it's kind of like it's unclear.

1635
01:53:04,138 --> 01:53:09,138
Exactly. How is it that we're supposed to get out from under this if it's a mistake?

1636
01:53:10,138 --> 01:53:16,138
If we say no ring signatures on Bitcoin, is that a mistake or not?

1637
01:53:17,138 --> 01:53:21,138
And we say, well, if it is, how do we escape from it?

1638
01:53:22,138 --> 01:53:24,138
I think I think it takes a crisis.

1639
01:53:25,138 --> 01:53:26,138
That's all.

1640
01:53:28,138 --> 01:53:29,138
Cool.

1641
01:53:29,138 --> 01:53:32,138
Sorry to interrupt you guys, but I have to say goodbye here.

1642
01:53:32,138 --> 01:53:35,138
Unfortunately, I have another appointment now.

1643
01:53:36,138 --> 01:53:37,138
Yeah.

1644
01:53:37,138 --> 01:53:38,138
Thanks.

1645
01:53:42,138 --> 01:53:43,138
Yeah.

1646
01:53:43,138 --> 01:53:44,138
Check out BitVM.org.

1647
01:53:45,138 --> 01:53:46,138
Read the white paper.

1648
01:53:46,138 --> 01:53:47,138
Give us feedback.

1649
01:53:47,138 --> 01:53:48,138
Try to break it.

1650
01:53:49,138 --> 01:53:51,138
And yeah.

1651
01:53:52,138 --> 01:53:53,138
Have a great day.

1652
01:53:53,138 --> 01:53:54,138
Bye.

1653
01:53:54,138 --> 01:53:55,138
Cool.

1654
01:53:55,138 --> 01:53:56,138
See you.

1655
01:53:56,138 --> 01:53:59,138
I'm also going to sort of turn off my mic.

1656
01:53:59,138 --> 01:54:01,138
Thanks, Paul, for everything you do.

1657
01:54:02,138 --> 01:54:03,138
Yeah.

1658
01:54:03,138 --> 01:54:04,138
Paul is awesome.

1659
01:54:04,138 --> 01:54:05,138
Activate BIP300.

1660
01:54:10,138 --> 01:54:11,138
Thanks, guys.

1661
01:54:13,138 --> 01:54:20,138
Let's see if we want any more questions from the audience that are new or about anything.

1662
01:54:24,138 --> 01:54:31,138
In the meantime, I can maybe chime in on what we just discussed on Monero.

1663
01:54:32,138 --> 01:54:33,138
Yeah, do it.

1664
01:54:33,138 --> 01:54:44,138
I start to get this theory that how I see it is that any more or less successful layer one that we've seen, like Monero and others,

1665
01:54:45,138 --> 01:54:51,138
basically always reach some kind of or have some property that reach product market fit in the market.

1666
01:54:51,138 --> 01:54:55,138
And privacy basically is one of those properties.

1667
01:54:55,138 --> 01:54:59,138
And it shows that there is demand or blockchain demand for something.

1668
01:54:59,138 --> 01:55:00,138
And that's privacy.

1669
01:55:01,138 --> 01:55:02,138
Same for Ethereum.

1670
01:55:02,138 --> 01:55:05,138
It shows that there's demand for a virtual machine in a blockchain.

1671
01:55:05,138 --> 01:55:06,138
Same for Solana.

1672
01:55:06,138 --> 01:55:13,138
It shows that there is demand for fast, for high speed transactions, for gaming, et cetera.

1673
01:55:13,138 --> 01:55:19,138
And Bitcoin is, of course, the most secure decentralized money.

1674
01:55:20,138 --> 01:55:22,138
And I think all of those will be true.

1675
01:55:22,138 --> 01:55:28,138
But for money, it matters most that what Bitcoin has.

1676
01:55:28,138 --> 01:55:34,138
But you can have all those properties on second layers or on sidechains.

1677
01:55:34,138 --> 01:55:40,138
So I fully believe at some point we'll see a Monero fully running on Bitcoin as a sidechain.

1678
01:55:40,138 --> 01:55:44,138
Or Solana will be a very fast sidechain.

1679
01:55:44,138 --> 01:55:48,138
Or, yeah, the EVM, of course, makes so much sense.

1680
01:55:48,138 --> 01:55:50,138
But that's basically what I've been thinking.

1681
01:55:50,138 --> 01:55:51,138
Yeah, I mean, I hope so.

1682
01:55:51,138 --> 01:55:54,138
But I mean, like, I've been waiting for like eight years.

1683
01:55:54,138 --> 01:55:59,138
I mean, not that I've only focused on this.

1684
01:55:59,138 --> 01:56:03,138
But yeah, I think that that's the idea is that eventually it would.

1685
01:56:04,138 --> 01:56:08,138
But, you know, weirdly, this is why I mentioned the culture,

1686
01:56:08,138 --> 01:56:19,138
where the scenario with the culture is like that people have decided that they don't really even want these things.

1687
01:56:19,138 --> 01:56:23,138
So there'll be hostility to those hostilities like 119 or something.

1688
01:56:23,138 --> 01:56:24,138
So I don't know. I mean, I hope so.

1689
01:56:24,138 --> 01:56:39,138
But I think that is going to be kind of a concerning development of like, do people even want there to be EVM on Bitcoin or something?

1690
01:56:39,138 --> 01:56:42,138
It'll be an interesting thing to see it play out.

1691
01:56:43,138 --> 01:56:48,138
Well, I guess we'll see very soon because it's happening.

1692
01:56:48,138 --> 01:56:51,138
But yeah, I think there will definitely be a lot of hate.

1693
01:56:51,138 --> 01:57:00,138
But in the end, if it gains adoption, then the market basically tells us they were wrong in that sense.

1694
01:57:05,138 --> 01:57:07,138
Cool. Great. Yeah, I agree.

1695
01:57:08,138 --> 01:57:09,138
Yeah, I agree.

1696
01:57:09,138 --> 01:57:15,138
You know, if you're not going to be one of the ones using this, then, you know, it's kind of annoying when people.

1697
01:57:16,138 --> 01:57:29,138
It should be a relationship between the software developer and their users and not like random other people who don't know what to, you know, comment and they don't know what they're talking about.

1698
01:57:29,138 --> 01:57:31,138
Anyway, Flavor, did you have something?

1699
01:57:33,138 --> 01:57:37,138
Oh, I just want to ask, I guess, a little more straightforward of a question.

1700
01:57:38,138 --> 01:58:03,138
It kind of ties into the first question I asked, which is that it does seem a little bit like, too bad that Robin left, but that BitVM and SpiderChain are almost answers to the issues that Drivechain has faced with the bureaucracy and the idea that Drivechain needs permission, whereas BitVM and SpiderChain don't.

1701
01:58:04,138 --> 01:58:19,138
And so I guess that's kind of why I was asking that question, and I wanted to hear Willem speak to that, I guess, and speak, I guess, a little bit, share your thoughts on what you've seen Drivechain go through on a political level.

1702
01:58:20,138 --> 01:58:29,138
Well, you know, I've never actually released, you know, I never had a pull request and I never released client software that miners could run to activate.

1703
01:58:30,138 --> 01:58:32,138
So, but yeah, I did.

1704
01:58:33,138 --> 01:58:35,138
So that's it's possible.

1705
01:58:36,138 --> 01:58:47,138
But yeah, I do think that in general, the soft fork idea kind of died in after SegWit, because sure, we had Taproot, but that's all we've had.

1706
01:58:47,138 --> 01:58:54,138
And so that makes us going from like 2015, December, until the present with only those two.

1707
01:58:55,138 --> 01:59:03,138
And people are just awkward, they don't want to every time this, this activation logic pops up.

1708
01:59:04,138 --> 01:59:27,138
People get annoyed, and that is because they're all of them have mistaken views, I think, honestly, we could clean them all up by just saying, we had this thing, BIP-9, and it required 95% hashing, hash rate to activate soft forks, but then miners use that to hold the soft fork hostage.

1709
01:59:28,138 --> 01:59:41,138
And that had nothing to do with the soft fork, though, that everything to do with other things, other mistakes that have been made by overlapping groups of people.

1710
01:59:42,138 --> 01:59:48,138
So it's true, though, but yeah, I don't understand why the bigger question is, why aren't?

1711
01:59:49,138 --> 01:59:51,138
Why didn't people work on drivechain?

1712
01:59:52,138 --> 02:00:00,138
Like, why didn't they just switch to working on drivechain after problems with the lightning network emerged in like 2017, 2018?

1713
02:00:01,376 --> 02:00:14,376
And why didn't they pursue sidechains in general? I think, honestly, a lot of it is just because of Liquid, where everyone thought Blockstream was working on it, and then people didn't really realize that they had abandoned it.

1714
02:00:14,376 --> 02:00:41,376
That's my guess. It's hard to say. I think now it's very weird, because, as I've said, as the altcoins have gotten stronger, the prevailing attitude among Bitcoiners is to just deny that there's anything good happening over there. So that's not really constructive. But I don't know, it's a very weird situation.

1715
02:00:41,376 --> 02:01:03,376
I think the idea of not needing a soft fork, that is, of course, touted as an advantage of BitVM and spiderchain, over drivechain. But in my view, this is just a symptom of a disease. There's no reason to have a prejudice against the soft fork.

1716
02:01:03,376 --> 02:01:23,376
The reason why people failed with the soft fork was because the relationship between developers and miners was one of distrust. So people had failed already to do the right thing, which was communicate their ideas effectively on both sides.

1717
02:01:23,376 --> 02:01:41,376
So they had failed already, and then they doubled down on their failure by blaming the soft fork, when all the soft fork did was hold up a mirror to their own lack of virtue and lack of leadership and just overall inability to achieve success.

1718
02:01:41,376 --> 02:02:03,376
So they blamed the mirror, which is a soft fork. I'll explain what I mean by that, which is we make all kinds of code changes all the time in Bitcoin, any of which could be like a assert zero bug that crashes the node or which has some kind of key logger or do something else that's terrible.

1719
02:02:03,376 --> 02:02:19,376
Matt Corral inadvertently, I don't want to blame him, but he was just trying to speed up something by like half a millisecond. And he inadvertently introduced an inflation bug. That has nothing to do with whether or not it's a hard or soft fork intended.

1720
02:02:19,376 --> 02:02:39,376
So this is such a notable case, because that one in particular was found by a Bitcoin Cash developer and then reported to BTC. So I'm just saying, weird stuff is totally possible when you are not, it has nothing to do with hard soft fork, hard fork, no fork, whatever.

1721
02:02:39,376 --> 02:03:03,376
If we want to be pro ossification, we should just not change, there should be no code changes at all, no refactoring, no nothing, just don't change the code. If we are, if we wisely say, well, that idea is probably never going to work, because you have things like dependencies and CVE, right, critical vulnerabilities.

1722
02:03:03,376 --> 02:03:21,376
Just anything about the hardware changes, the software, the operating systems change. Do you have something on a phone? Do you have something on a tablet? These things change over time. So the ossification is probably not happening just because of dependencies alone.

1723
02:03:21,376 --> 02:03:43,376
So what I'm getting at is, why do we care so much about the soft fork? What it does is, again, is the soft fork is the mirror. It's, we look into the mirror and we see something really ugly. And we say, and what it says is we can't soft fork. But it's, you know, it's not the mirror's fault, it's our fault.

1724
02:03:43,376 --> 02:04:05,376
We are bad at doing, we're bad at communicating ideas to the community, the miners are bad at taking responsibility for both their past mistake, and also they're bad at taking responsibility for the future of Bitcoin. They say, I have invested all this money in mining equipment, we will do, you know, soft forks again.

1725
02:04:05,376 --> 02:04:29,376
Developers have decided that they, they, developers have decided to become spineless, basically, they've said, I don't want to take responsibility for soft fork, because as what happened with Jeremy Rubin and myself, you get blamed, you get a lot of unwanted attention from, you know, people have no idea what they're talking about. And the developers all look the other way, which makes them kind of complicit, really.

1726
02:04:30,376 --> 02:04:54,376
They are the, you know, first they came for the such and such. But the, so this is all what it is, it's a very ugly situation. And everyone is determined to just say, just evade the issue, which is on one sense is very rational, because they will just evade the issue because we don't need a soft fork.

1727
02:04:55,376 --> 02:05:16,376
But I think that we make all these changes already, every single version, there's numerous, numerous changes that are, you know, they're not good. Or I mean, they're harmless. That's not what I mean. What I mean is we make all these changes, but they don't get treated with the same, like this might destroy Bitcoin attitude.

1728
02:05:16,376 --> 02:05:45,376
So it's just pointless, completely pointless. And yeah, the reason why it's a symptom of something much worse, is that it just speaks to how little any of these words mean anything. You know what I mean? Like you time travel 100 years in the future and say, I use Bitcoin today. And Bitcoin is something controlled by the Fed in the United States, and it has an unlimited supply, and it has no privacy, but people call it Bitcoin.

1729
02:05:47,376 --> 02:05:52,376
100 years from now, because we've already started to do this with like custodial lightning, for example.

1730
02:05:53,376 --> 02:06:18,376
So if the words stop meaning anything, as soon as we lose, you know, the honesty, and the self criticism, then it's all it will all go away. And so that's what I'm trying to say about this whole thing about needing a soft fork, like it's, it's ridiculous. It's not anything. It just shows how we no longer are able to think about ideas correctly.

1731
02:06:19,376 --> 02:06:46,376
I would say, to add on here, Paul, I would say there is something that speaks for ossification. And when you think about all technologies, and even science and mathematics, you always form a certain basis. And as an example, you have the internet, could there have been a better TCP IP? Could there have been better? I don't know, low level designs, probably.

1732
02:06:47,376 --> 02:07:09,376
But there is something that enables further development once the basis no longer changes a lot. And I think, like, do I believe Bitcoin will ossify at some point? Yes. And I think it probably should, because you can make development of building on Bitcoin way more predictable.

1733
02:07:10,376 --> 02:07:34,376
And so I would also argue a little bit, because you talked about that we're constantly making changes to Bitcoin, I think there's a dependent, there's a difference between fixing small issues and bugs and opening up new, new possibilities. That said, I'm playing the advocate of the devil here, because I would love to see more soft forks happening.

1734
02:07:34,376 --> 02:07:38,376
You're 100% correct.

1735
02:07:41,478 --> 02:07:42,198
You're 100 % correct,

1736
02:07:43,518 --> 02:07:47,138
but the soft fork already is the ossified, you know what I mean?

1737
02:07:47,538 --> 02:07:51,378
this, the hard fork that breaks the ossification, it's the soft fork if it's already

1738
02:07:51,378 --> 02:07:55,458
backwards compatible. So that's why I say it's no different than any other code change.

1739
02:07:56,418 --> 02:07:57,798
They say we change the way

1740
02:08:05,376 --> 02:08:14,376
And it's a hard fork, or it's a soft fork. So you know what I mean? If someone refactors, they change how a matrix is multiplied, and they save half a second, that is a soft fork, really.

1741
02:08:15,376 --> 02:08:19,376
Version 25 is a soft fork of version 24, Bitcoin Core.

1742
02:08:19,376 --> 02:08:33,376
So a soft fork really, I mean, I guess if you wanted to really make the definition mean something, it would just be has 51% of the miners run the latest version.

1743
02:08:34,376 --> 02:08:44,376
Or 51%. But so but you can do an awful lot with that. I mean, TCP IP, of course, it was general enough to have the whole internet built on top of it.

1744
02:08:45,376 --> 02:09:05,376
So if is that true of Bitcoin today, I certainly think we should have 119 300 and up vault. I think I think up vault should be on L1 or something like it should be some kind of vaulting thing should be on L1.

1745
02:09:06,376 --> 02:09:31,376
I mean, if we don't, the other thing, though, is that the TCP IP, if you how am I going to put this what I'm trying to articulate is that they were really I'm trying to articulate the point that we all as you move up the stack,

1746
02:09:32,376 --> 02:09:56,376
the barriers to entry are lower, like it's very easy to launch an altcoin, right? Relatively speaking, but then if you would have time traveled to the past, how easy would it have been to launch a different like, you know, a different TCP IP that that would work and get get people to adopt that would have been pretty difficult.

1747
02:09:57,376 --> 02:10:14,376
So there's more competition. So I think that speaks to more competition there is, the more you have to worry about being replaced. And it's kind of like TCP IP. I'm sure fortunes were made and lost, you know, when that was chosen, so to speak.

1748
02:10:15,376 --> 02:10:31,376
But it won't be like this with Bitcoin, where you have a lot of people involved who don't know anything, you know, TCP IP, probably most of the people involved were had more direct knowledge of. So that's, whereas today, you have a lot of people who just invest and they just think this is, you know, future money or something.

1749
02:10:31,376 --> 02:10:56,376
I'm not sure how it's a bigger, bigger topic. So I'm not sure. But I agree with you that it should also buy Bitcoin can and will also fight to some extent. It's, it can never also fight completely, because of like dependencies and like hardware and things. But it will just be removing the, it'll be re emulating the same exact same thing.

1750
02:10:57,376 --> 02:10:58,016
same thing.

1751
02:10:59,376 --> 02:11:00,516
So I think that that's the case.

1752
02:11:00,836 --> 02:11:04,476
I don't see it...

1753
02:11:04,476 --> 02:11:09,356
You should only do that when you actually have the ability

1754
02:11:09,356 --> 02:11:15,030
to, first of all, meet the It's a minimum that we would

1755
02:11:15,030 --> 02:11:18,090
be able to meet the planetary scale.

1756
02:11:18,490 --> 02:11:22,070
Like TCPIP scales to 8 billion people.

1757
02:11:23,910 --> 02:11:26,650
So if you can't do that, then you should just be crossed off the list.

1758
02:11:27,910 --> 02:11:32,250
So we'll see about what types of L2s work for that.

1759
02:11:33,564 --> 02:11:34,164
yeah, I don't know.

1760
02:11:34,544 --> 02:11:35,404
I think it's not quite the same.

1761
02:11:35,624 --> 02:11:37,504
I think there's a lot of truth to what you're saying.

1762
02:11:53,158 --> 02:11:57,138
Well, hey, this has been a fun, I don't know if we should please come up if you have

1763
02:11:57,138 --> 02:12:02,278
questions. Otherwise, could have a shorter one today at only

1764
02:12:02,278 --> 02:12:04,538
two hours a little.

1765
02:12:13,772 --> 02:12:16,352
It doesn't seem like anyone wants to come up at the moment.

1766
02:12:23,432 --> 02:12:24,872
So, I think we can end it.

1767
02:12:24,912 --> 02:12:25,646
People can listen to the

1768
02:12:25,646 --> 02:12:31,406
recording. hope someone got something useful out of all this.

1769
02:12:34,106 --> 02:12:37,826
Yeah, I can maybe end up on the last note.

1770
02:12:39,626 --> 02:12:45,566
I think a lot of what we've been talking about will

1771
02:12:45,566 --> 02:12:47,666
change over the coming months.

1772
02:12:48,566 --> 02:12:50,846
Like we'll soon see.

1773
02:12:52,126 --> 02:12:57,706
So I've seen the testnet run a few times from Botanix, first version of a

1774
02:12:57,706 --> 02:13:01,626
centralized node with an EVM, and so it becomes very easy.

1775
02:13:01,666 --> 02:13:06,706
to start deploying and I think it will be groundbreaking and mind -blowing for a people

1776
02:13:06,706 --> 02:13:12,246
to really see it work so I think that will change a lot of perception over the coming

1777
02:13:12,246 --> 02:13:17,506
months once you see it like people are visual people they love to see things so

1778
02:13:17,506 --> 02:13:20,402
definitely stay in touch make

1779
02:13:20,582 --> 02:13:23,222
make sure to follow the next account.

1780
02:13:24,022 --> 02:13:28,422
And very soon we'll see that testnet.

1781
02:13:29,402 --> 02:13:31,402
then, yeah, can...

1782
02:13:32,882 --> 02:13:36,702
Every time I use it, it's quite incredible to see.

1783
02:13:36,962 --> 02:13:38,802
So I think a lot of the discussions will

1784
02:13:39,159 --> 02:13:41,499
soon very quickly change.

1785
02:13:42,819 --> 02:13:48,499
Cool. Yeah, that's always nice when people can run the software and actually

1786
02:13:48,499 --> 02:13:53,599
experience it. That's usually better for learning about things.

1787
02:13:55,579 --> 02:13:57,539
Okay, great. hey, thanks everyone.

1788
02:13:59,055 --> 02:14:01,815
Hope you enjoyed this, got a good time.

1789
02:14:02,655 --> 02:14:05,095
We usually hang out every week, every Friday afternoon.

1790
02:14:07,095 --> 02:14:08,295
So, thanks a lot.

1791
02:14:09,735 --> 02:14:12,075
Awesome, thank you, Thank you.

1792
02:14:14,335 --> 02:14:15,235
Bye, everyone.