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Hello, and welcome to Drivechain Twitterspaces.

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This is Henry at LayerTwo Labs.

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Today we have a bunch of cool stuff to discuss

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related to recent conversations on Twitter and elsewhere

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regarding drivechain, sidechains,

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and how Bitcoin would be greatly strengthened

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through adoption of drivechain.

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Drivechain Twitterspaces by LayerTwo Labs

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happens every Monday and Thursday on Twitterspaces,

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and we are planning to also do a podcast in the near future

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where we'll interview many exciting and brilliant

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members of the Bitcoin community focused on sidechains.

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Sidechains are a path for Bitcoin development in the future

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which can be greatly embraced further.

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Already, Bitcoin has some sidechains,

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but they are not as peer-to-peer in their design as they could be.

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Right now, every Bitcoin sidechain uses a 15-party multisig federation

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or a similar design with a different number of multisig participants.

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Even if the number of multisig participants were 5,000,

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it would not be peer-to-peer.

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A peer-to-peer arrangement is one in which

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no person or organization has been socially selected.

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A peer-to-peer arrangement is one in which

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there is no barrier other than economic cost to entry for each role.

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In other words, if anyone is socially selected

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to participate in the security model of a sidechain,

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then that sidechain's foundation is not peer-to-peer.

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Its security model is not peer-to-peer.

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What we want is something like Bitcoin

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where anyone can opt in to being a miner, a user, a node runner,

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with the only barrier to entry being the cost.

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No one is ever socially selected, necessarily,

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to participate in any aspect of Bitcoin.

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Instead, the whole system involves parties, presumably,

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that are anonymous, mutually distrusting, and self-interested,

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and yet there is an emergent order.

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So, ah, we have a request to speak.

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Or do we not?

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Everyone is welcome to request to speak and come on up to the stage,

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and they can participate, ask questions, share thoughts.

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I see some familiar faces in the audience.

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We love it when people join our spaces,

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whether they are newcomers, OGs, skeptics, or avid fans.

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And there's been a lot of great discourse lately

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on the need to make sidechains more peer-to-peer,

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as Adam Back says.

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Sidechains today have the multisig federation,

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typically 15 people, socially selected.

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Sometimes no one knows who they are.

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And with drivechain, the sidechains would be, as Adam says,

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more peer-to-peer.

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It would be a dynamic group of parties participating in mining

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and expressing the will of the community

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through their activities in mining.

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It's entirely reliant on economic incentives and profit motive,

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just like Bitcoin does.

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Just like Bitcoin has an emergent order,

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even though all of the parties can be anonymous,

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mutually distrusting and self-interested still,

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the order emerges and the value is created reliably and robustly.

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We had a number of great tweets recently

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about drivechain and related topics

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within the discourse that's occurred recently.

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Let's look at some of those tweets as fodder for conversation.

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So I will share to the nest those tweets.

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The first one is from one of our favorite thinkers in Bitcoin,

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Warren Tagami.

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He wrote recently,

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it wouldn't matter if Satoshi were to appear today with or without keys.

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Appeals to authority would mean failure of the decentralized system.

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Satoshi's ideas should be evaluated on a case-by-case basis,

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like any other contributor to the safety-critical peer review process.

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That's a really great thought

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because so much of what Satoshi said was perfect and outstanding,

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but there are parts that were left unfinished and he knew that.

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And that's why he wrote that the main parts of Bitcoin are set in stone.

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He didn't say absolutely everything.

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So he was aware that there could be development, optimization,

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a few tweaks here and there that might make Bitcoin even better.

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So he had an inkling, perhaps,

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that something like drivechain could be useful.

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There could be an idea which would unlock even greater value accrual

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even greater network effect, even greater development,

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greater ossification, greater scaling.

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He was aware that there were some tensions in the system.

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For example, with regard to the block size,

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he said on the one hand that, you know,

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I mean, he himself placed the limit.

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And then he also talked about there being perhaps some discussion in the future

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on both sides of making it larger or keeping it the same.

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So he was aware of the tensions and he knew that updates might come.

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As drivechainers, we feel that if he were here today,

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he would probably support drivechain because it makes the system so much more

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robust in many ways, enabling greater peer-to-peer scaling,

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which brings us to our next tweet for discussion.

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Now that we've discussed Warren's excellent tweet,

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I will post to the Nest another.

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Anyone is welcome to come on up to the stage and chat if you'd like.

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The next tweet we'll discuss is from Adam Back.

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I've placed it in the Nest.

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Adam wrote,

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I think we're going to need big peer-to-peer sidechains for the next billion

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users to benefit from unseizable sensor-resistant Bitcoin,

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opcodes to support peer-to-peer sidechains like drivechain from LayerTwo Labs,

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peer-to-peer liquid, Rootstock.

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That's his statement.

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In fact, that was written today, this morning.

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A great tweet from Adam Back explicitly endorsing large block Bitcoin

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sidechains.

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He has in mind, of course, Thunder sidechain,

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which is the product of the work of LayerTwo Labs and related developers who

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have, over the years, conceived and developed code for a large block sidechain,

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which would begin with a smaller block size than 1 gigabyte.

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And over time, over a few years,

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it would scale up to 1 gigabyte,

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enabling a very exciting experiment in the Bitcoin space,

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a very exciting experiment where the value of large blocks might be massively

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fulfilled as a Layer 2 large block sidechain instead of an altcoin.

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So far,

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there have been experiments with copies of Bitcoin modified with a larger block,

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but they were on a base layer.

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They were not an opt-in feature of a small blockchain.

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So it's a very different thing when the large block size blockchain is a second

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layer.

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It's a very different thing than when it's a first layer.

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It's a whole different arrangement, and that's important.

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So it's an experiment, an innovation,

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and probably a very successful one,

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as we'll see in the near future after drivechain is adopted and the large

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block size sidechain is launched.

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Of course,

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it's worth noting that this experiment would not include the creation of a new

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token.

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Instead,

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a synthetic Bitcoin is the token on the sidechain,

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and the only way to create it is to place Bitcoin in hash rate escrow.

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This,

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as Adam Back has tweeted,

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maintains Bitcoin's 21 million unit limit while enabling a different experience

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for the user in terms of more scaling,

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more low fees,

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high throughput,

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the kinds of things that large blockers talk about as advantages correctly.

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Most excitingly for the community,

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this would bring home to Bitcoin,

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the large block community.

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Thousands of people were upset years ago in the block size war,

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and some of them left.

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With drivechain,

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they would come back to Bitcoin,

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not for sentimental reasons,

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but for pure financial profit,

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because profit is what accrues to the user of the best money,

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the money that has the most features,

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the most network effect,

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the most stability.

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That is what will bring people to drivechain,

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and Bitcoin is profit motive.

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Nothing else.

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Drivechain relies on nothing else but people's self interest.

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That is what will make Bitcoin more valuable when it has peer to peer side

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chains is profit motive.

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So Adam Back's statement there is great.

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All of you are welcome to come on up to the stage and share a thought if you'd like,

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and we can also move forward to the next tweet for conversation in the thread.

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This one I've posted to the nest is from Jameson Lopp.

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He wrote this week.

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The one issue I have with anyone using the word inevitable when describing Bitcoin is that it could lull folks into a false sense of security,

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that it's safe for us to rest on our laurels.

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And Dan held wrote beneath that agreed.

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We should never rest.

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And then Dan held made an outstanding point.

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Dan held is one of the commenters in the Bitcoin space who for years has had many excellent ideas and insights,

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among many other people held wrote in response to Lopp.

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Also to win parenthesis price transaction fees building close parenthesis.

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We inherently need more believers, which would move past which will move past the homebrew computer club types.

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In other words, what Dan held is saying there is a few things.

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First, we can't have Bitcoin be only for ultra cypherpunks because that view that outlook for Bitcoin,

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that it's for people who are hardcore Bitcoiners necessarily means that Bitcoin is only for a tiny fraction of the world.

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Most people aren't interested in living in a bunker and having a totally anonymous life.

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Most people are, you know, buying the latest Kim Kardashian lingerie.

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It's not that they're living in a bunker, you know, collecting guns.

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So we want Bitcoin to be for everyone.

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But we also want to elevate humanity by having a peer-to-peer electronic cash that has no inflation and that is permissionless.

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So no one's getting doxed and de-platformed and sent to the Gulag.

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So how do we do that?

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We have to make it the best possible technology.

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Nothing less than the best possible version of Bitcoin will win.

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Nothing else has a shot.

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We're up against statism.

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We're up against collectivism.

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This is the kind of thing that Fiatjaf I feel would agree with.

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He tweets to this effect often that all of the value of Bitcoin right now, all of it is predicated on the expectation that Bitcoin will take over the world.

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Everyone who's holding Bitcoin today is betting that it's going to go all the way.

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So we have to make sure that it does.

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And to the extent that the Bitcoin community would adopt a narrow mandate for development, then the value would be much lower.

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So we have to be very ambitious.

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And that includes focusing on experimentation and innovation.

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While at the same time enabling conservatism, stability and ossification.

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And how do we do that?

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We have a multilayered architecture in which the base layer is stable.

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Ossified, conservative, reliable, mostly unchanging.

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And the upper layers, the upper layers are innovative, experimental, varied.

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And indeed, they will compete with each other in the fascinating design known as drivechain.

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So multiple second layers, each offering different features, enabling the community to see what ideas accrue value and what ideas don't.

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That's the drivechain vision.

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It's more capitalistic.

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Instead of merely having us deliberate on how to change main chain every few years.

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Instead, we ossify it and let developers compete to create value in the sidechains.

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That's the drivechain vision.

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Sidechains will come and go depending on whether users want them or not.

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Without ever changing the main chain.

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So Jameson Lopp's tweet in the nest was great, as was Dan Held's tweet under it.

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One of the great things that Dan Held has said lately, Dan Held is really on a roll.

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He said recently in that tweet that I just read that, as you noticed, he wrote price, transaction fees and building.

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Those are the things that he feels are the path to winning.

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So let's focus on the issue of transaction fees.

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It's vitally important that Bitcoin have high transaction fees.

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Some people don't agree with this.

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Like yesterday, there were one or two tweets from Pierre Richard, an excellent thinker who doesn't hold the view that we agree with as drive chainers.

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As drive chainers, we know that Bitcoin needs high transaction fees as part of its security budget.

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And Richard, who we respect, wrote in disagreement with that notion.

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He wrote that Bitcoin's security budget is not a concept that he accepts as it's ordinarily discussed.

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He rejects the notion, Richard does, that he rejects the notion that we must have a high security budget.

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We must have high fees.

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In his view, it would be fine if the fees rise only when there is an attack occurring.

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So our view as drive chainers, which we believe is definitely correct, is that Bitcoin must have a massive security budget, meaning very high fees in the future as the subsidy gets smaller and smaller.

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And also we would go further and say that all of the rhetoric which questions the validity of the notion of these words like subsidy and security budget, all of this criticism of this language is sort of a cope.

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People who see that the fees are low say, well, it doesn't matter if the fees are low and we shouldn't even use words like security budget to describe that the fees are low.

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So they're trying to say that whatever the security budget is, is fine.

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In my personal experience, I've had conversations with people who said that it doesn't matter when the fees are low, but when the fees go up momentarily, then they celebrate that.

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For example, we saw that with Greg Maxwell, who wrote in 2017, one of Bitcoin's most excellent thinkers, wrote in 2017 in December that he was breaking out the champagne when transaction fees were $50 each.

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And Bitcoin miners were making many millions of dollars per day at that time.

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For a brief moment, the fees were very high.

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He was celebrating.

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Well, there's been silence over the last five years on that topic from him.

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As far as I can personally recall, he hasn't been making a great complaint that the fees are low over the last few years when they mostly have been.

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So it would be interesting to know, like if he was celebrating when the fees were high, what is his thought today?

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Same thing with Pierre Richard.

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I would imagine that when the fees are high, he would say, well, in fact, yesterday he tweeted that it's wasteful.

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If the fees are high when there's no attack, it's a waste.

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But as drive trainers, we know that we want consistently high fees to create a prohibitively costly hostile attack situation where no one would even contemplate attacking Bitcoin because it would cost them a trillion dollars a year.

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That's the ideal situation.

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Right now, the concern should not be that Bitcoin is oversecured and that fees are wastefully being spent.

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Instead, we want high fees consistently all the time.

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Everyone's welcome to come on up to the stage and ask a question.

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We can have a chat.

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Raise your hands.

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Don't be shy.

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But if we don't have any speakers, then I'll continue with these tweets that we're discussing.

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The next one in the thread that was posted today by LayerTwo Labs.

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Now that we've discussed these excellent thoughts by Warren Tagami, Adam Back, Jameson Lopp, and Dan Held, the next thought that we'll discuss is a recent tweet from two days ago from Rob Hamilton.

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Rob is very often in Cafe Bitcoin in Clubhouse.

254
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So if you want to talk to him, he's available there.

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I have many times.

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He wrote this excellent tweet that I thought was repeating here about the importance of Bitcoin discourse not having any threats of violence.

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It was very smart of Rob to contribute at this moment when there's been some friction in the community.

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He contributed by saying to everyone, let's not have these threats of violence.

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And I thought that was a great statement.

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So you can read his tweet there if you'd like.

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It's in the Nest.

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And then the next tweet that we'll discuss is from the one and only Fiatjaf.

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I have placed it in the Nest.

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It is a link to his own essay on Drivechain.

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And he wrote, I think the arguments on fiatjaf.com slash Drivechain are pretty compelling.

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They have convinced me over and over every time I lose faith and reread.

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That was great.

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Fiatjaf, I was very impressed when the first time I read that essay, I thought, wow, this guy really gets it. He writes. He writes about Drivechain with such clarity and understanding.

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I'm not sure if his essay mentions the security budget, though, I should reread it today to confirm that.

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Fiatjaf, like Adam Back, talks about Drivechain often in terms of innovation and experimentation.

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People come to Drivechain with different things in mind. Some people understand Bitcoin primarily in the context of payments.

272
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And they like that sidechains could offer more scaling opportunities for Bitcoin as a complement to lightning.

273
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However, in Fiatjaf's case, I recall he tweeted once that HiveMind is the thing that excites him the most about Drivechain.

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And he thinks that Drivechain is worth doing if only for HiveMind. So therefore, peer to peer oracles are the thing that Fiatjaf feels are very exciting.

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Others have expressed interest in large block sidechains. Some people come to Drivechain for the security budget concerns, which are certainly very valid.

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And others might come to Drivechain out of an interest in having Bitcoin main chain ossify.

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And lastly, but not leastly, some people come to Drivechain because they comprehend all of these things like scaling, innovation, ossification, security budget.

278
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And they put it all together and they realize that ultimately the final effect of Drivechain is that it would cause Bitcoin's price to skyrocket, potentially.

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Because if Bitcoin achieves greater peer to peer scaling, greater long term security budget outlook, greater ossification for main chain at the same time as greater extensibility for layer twos,

280
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and greater fees paid to Bitcoin miners, if Bitcoin gets those four things, the result will be so powerful, potentially, that the price would rise a lot.

281
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And not just from onboarding more Bitcoiners who have never had any crypto, but also absorbing all of the users value and technology of the altcoins.

282
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And this wouldn't simply double Bitcoin's price. If all of the energy spent hating on altcoins were instead directed towards Bitcoin development more productively,

283
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then all of the friction and internal conflict within the crypto community that's currently being wasted, where Ethereum people and Bitcoin people yell at each other,

284
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and write all these essays and conversations about which is better.

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Instead, imagine if everyone were on Bitcoin, everyone were using Bitcoin as their base chain, and then they all had their sidechains harmoniously without any friction or competition.

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Well, there would be competition in a sense, but it would be on top of Bitcoin, and everyone would be using a synthetic Bitcoin in their sidechain.

287
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So it would be synergistic, we wouldn't just double the Bitcoin price, it would go up much higher, because all the energy that's been spent fighting altcoins would no longer be spent that way.

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Bitcoin would no longer have competition. So the narrative around Bitcoin will be much more powerful.

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So the ultimate effect of drivechain in the most idealistic, optimistic vision is that drivechain would cause Bitcoin to rapidly absorb the entire crypto community,

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sending the price to the moon, strengthening Bitcoin politically, culturally, and economically in every way.

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It would return Bitcoin to the best possible trajectory that it used to have.

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It used to have, in the early days of Bitcoin, from 2009 through 2014, Bitcoin had a certain character, as I understand from my historical reading and conversation.

293
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It had a certain energy that has dissipated to some extent over the years due to the failure to adopt peer-to-peer sidechains.

294
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So let's return Bitcoin to that path. Let's avoid the flippening. Let's avoid it. Let's avoid a security budget problem. Let's avoid custodial scaling.

295
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Let's avoid the threat and risks of ongoing changes to mainchain.

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We cannot continue to do this every few years, changing the mainchain. It is disruptive. It is risky.

297
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We have to do a change which would end all changes.

298
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Now, of course, some people don't like the idea of ossification.

299
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There have been some brilliant people in Bitcoin like Moon Settler and like Luke Dashjr and others who do not agree that ossification is a great thing.

300
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But, you know, just in general, I don't want to misquote them.

301
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But basically, the idea here is that we want to have a higher degree of ossification than we currently have.

302
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If we can think of ossification as in terms of degrees, what we want for Bitcoin is for there to be a natural, a natural achievement of ossification of a higher degree than we currently have.

303
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Right now in the community, there are calls to do a few different changes to mainchain, a few different soft forks.

304
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And what we would like as drivechainers is to see a change done, which would naturally reduce the pressure within the community for more changes.

305
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Because instead, all of these developers with all of their excellent ideas would happily build on sidechains.

306
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And if any of the sidechains were to become so successful that its value was approaching the value of mainchain, then we would have a market signal mechanism to know that perhaps that code should be brought down to the mainchain.

307
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So instead of debating what to do, we would have a way of testing economically, capitalistically.

308
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So we're not saying Bitcoin would never, ever change for any reason.

309
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Absolutely. In the future, when we say that ossification is necessary and important, what we mean is that we should have a natural achievement of lower pressure to change mainchain.

310
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And perhaps with drivechain, we're saying, perhaps with drivechain, after it's adopted, everyone who wants to develop on Bitcoin will happily do it in a sidechain.

311
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And then they'll have to prove that their idea is so good by having it grow such that the sidechain is so large.

312
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And then we would have maybe another change to mainchain.

313
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Like, for example, some people want to see rollups on Bitcoin, but rollups, zero knowledge proofs, things like that involve the latest complex mathematics.

314
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And maybe it's experimental to an extent that it would be risky to add it to Bitcoin at this moment.

315
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So instead, we could do drivechain, which uses technology that's been discussed for years and isn't quite so experimental and risky, one would argue.

316
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And we could do rollups on the sidechain.

317
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And if they prove to be successful and if they accrue a lot of value, if they accrue a lot of value, then that could be brought down to mainchain.

318
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So drivechain would fundamentally improve our system for making changes to Bitcoin on mainchain, where ideas have to accrue value and prove themselves instead of what we have today, which is merely testnets and conversation.

319
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And of course, altcoins. But experimenting with altcoins, using altcoins for experiments is a risky proposition, because suppose the Ethereum experiment proves to be successful.

320
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Suppose the Ethereum experiment grows and grows and grows, and then it's so large that it's competing with Bitcoin.

321
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Right now, it's already half of Bitcoin's market cap.

322
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This is a risky way, a very risky way of testing new ideas, because as Hasu himself wrote in 2017, Bitcoin, when he was referring explicitly to drivechain, he wrote drivechain good.

323
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Bitcoin needs a way to internalize innovation occurring outside of its mainchain.

324
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I believe that I'm reading it from memory, but I think that's what he tweeted.

325
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I don't think he used the word mainchain, but maybe he said blockchain.

326
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But the point is the same, that Hasu understood that it's not great for Bitcoin to let all the innovation and experimentation occur on altcoins, because what if one of them grows a lot?

327
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I mean, that doesn't bring any value to Bitcoin.

328
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In fact, the growth of altcoins is an explicit threat to the network effects of Bitcoin, and that's one of the key drivechain insights.

329
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Drivechainers understand that toxicity and denunciation and dismissal of altcoins is a cope by toxic Bitcoiners, and a wiser plan would be to try to copy all of the code of all of the altcoins, not to try to demonize them, because they're not going to be convinced of that.

330
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They know that their technology is legitimate. The technology in Zcash for privacy is definitely legitimate.

331
00:30:07,690 --> 00:30:11,690
The technology for privacy in Monero is definitely legitimate.

332
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The people working on Oracles, on Chainlink, and in Ethereum, these efforts are certainly scientific in nature, and whether or not there's a pre-mine or developer tax or backdoor doesn't change the fact that these are technological experiments to some extent.

333
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And it would be good for Bitcoin if they were occurring on Bitcoin instead of occurring on altcoins, where in the case of Ethereum, there is a substantial threat to Bitcoin's long-term network effects and Bitcoin's ability to maintain its market cap leadership.

334
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Come on up to the stage and ask a question.

335
00:30:51,690 --> 00:30:53,690
Don't leave me here all alone.

336
00:30:53,690 --> 00:30:55,690
Thank you, everyone who's listening.

337
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If you have a question or if you disagree with things I'm saying, come on up.

338
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Let's chat.

339
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Everyone gets things wrong sometimes.

340
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I could be mistaken.

341
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If you don't agree, raise your hand.

342
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Come on up.

343
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This is a recorded space.

344
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Everyone's welcome to listen live or listen afterwards.

345
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The next tweet that we'll discuss from that thread, this is the final one.

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I'm going to post it into the net.

347
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This is John Light, one of the most excellent thinkers in the space on sidechains.

348
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He wrote, you said, quote, do drivechain with CTV, unquote, but the retraction makes clear that the other opcodes are needed to actually make it work.

349
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By that point, might as well do BIP300, which is clean, straightforward, and most importantly, already exists and works and has a lot of tests, et cetera.

350
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So that's John Light responding to Tim Satz.

351
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Both of them are names that we're familiar with in the drivechain community, especially John Light.

352
00:32:05,690 --> 00:32:15,690
And the key part of that tweet that I just read was where he wrote that BIP300 is clean, straightforward, and most importantly, already exists and works and has a lot of tests.

353
00:32:15,690 --> 00:32:19,690
So in his view, we're ready to go with BIP300.

354
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John Light is an expert on rollups for Bitcoin, and he has a favorable view of drivechain and rollups for Bitcoin.

355
00:32:28,690 --> 00:32:30,690
He would like to see both of them adopted.

356
00:32:30,690 --> 00:32:34,690
He has spoken in Twitter spaces here with drivechain Twitter spaces, LayerTwo Labs.

357
00:32:34,690 --> 00:32:37,690
He's come and spoken here a few times.

358
00:32:37,690 --> 00:32:51,690
One time, he said that he supports doing drivechain and rollups, and he would expect that it would be easier to do drivechain first because it has more years of analysis and preparation.

359
00:32:51,690 --> 00:32:54,690
So he's a supporter in that sense.

360
00:32:54,690 --> 00:32:57,690
Ah, we have a request for a speaker.

361
00:32:58,690 --> 00:33:05,690
Welcome to the stage, Aminabek, Web3 NFT community builder.

362
00:33:05,690 --> 00:33:07,690
Oh, hi.

363
00:33:07,690 --> 00:33:10,690
I really like how you're doing this Twitter space.

364
00:33:10,690 --> 00:33:16,690
I've never actually had anybody pin really good tweets and then talk about them.

365
00:33:16,690 --> 00:33:19,690
So props to you.

366
00:33:19,690 --> 00:33:23,690
I just wanted to give a shout out also to Sol.

367
00:33:23,690 --> 00:33:41,690
He brought up a really good point on actually like onboarding new people to Bitcoin and just the difficulty that is very cost prohibitive and also just not very welcoming at all.

368
00:33:41,690 --> 00:33:47,690
I don't know if he'd like to come up, but there was a really good tweet that he put out.

369
00:33:47,690 --> 00:33:48,690
I don't know.

370
00:33:48,690 --> 00:33:50,690
Would you mind if I pinned it as well?

371
00:33:50,690 --> 00:33:51,690
Sure.

372
00:33:51,690 --> 00:33:52,690
Go ahead.

373
00:33:52,690 --> 00:33:53,690
Sorry.

374
00:33:53,690 --> 00:34:00,690
When you're referring to the cost of onboarding, are you referring to the fees like how it costs like a dollar or two right now for someone to...

375
00:34:00,690 --> 00:34:02,690
Oh, no, no, no, no.

376
00:34:02,690 --> 00:34:10,690
So basically, the Bitcoin ordinals have been really trending.

377
00:34:10,690 --> 00:34:15,690
They've been pretty popular in the last few months.

378
00:34:15,690 --> 00:34:20,690
The thing is, what I've noticed is I've done a lot of research.

379
00:34:20,690 --> 00:34:25,690
I've looked at how this can be done, and I even wrote about it.

380
00:34:25,690 --> 00:34:34,690
But then I tried doing it, and it was like $300 to inscribe one image, one JPEG.

381
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And the fees just are incredible.

382
00:34:38,690 --> 00:34:46,690
So then I just was like, okay, well, I guess I'm not going to inscribe because, I mean, that's like a portion of rent or whatever.

383
00:34:46,690 --> 00:35:02,690
So I just I feel like artists and creators are kind of getting left behind in this movement, even after providing education to themselves or learning what is necessary to do this.

384
00:35:02,690 --> 00:35:15,690
I think there's just other barriers that Bitcoin unfortunately hasn't resolved, and it makes it very hard to access what is there.

385
00:35:15,690 --> 00:35:17,690
Yeah.

386
00:35:17,690 --> 00:35:19,690
So those are great points.

387
00:35:19,690 --> 00:35:20,690
You're right.

388
00:35:20,690 --> 00:35:29,690
There are high financial costs to participating in activities on the blockchain in the case of ordinals and related things.

389
00:35:30,690 --> 00:35:46,690
It's a very, very complex topic, and there's uncertainty as to whether the value of the ordinals, like a Veblen good in economic theory, has to do with the high cost of participation.

390
00:35:47,690 --> 00:36:01,690
Kind of like how some brands never put their clothes on sale because they know that the fact that there are no sales, there are no low prices, is actually part of the demand for those goods.

391
00:36:02,690 --> 00:36:17,690
So the drivechain view on this topic is that if peer-to-peer sidechains existed, one would arise, which perfectly meets the needs of this kind of activity, as well as other kinds of activity.

392
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So there would be a funder sidechain with large blocks for transacting value with high throughput and low fees.

393
00:36:26,690 --> 00:36:35,690
And separately from that large block sidechain for transacting, there would be a sidechain called BitAssets.

394
00:36:35,690 --> 00:36:39,690
And people can read about this on drivechain.info.

395
00:36:39,690 --> 00:36:46,690
If you go to that website and then click on sidechain projects, you'll see one called BitAssets.

396
00:36:46,690 --> 00:36:52,690
Again, drivechain.info, and then click on sidechain projects.

397
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The BitAssets sidechain would be a sidechain on Bitcoin that is peer-to-peer and allows for activities of an ordinals and inscriptions nature.

398
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And this would be a great complement to that movement, and it would not interfere with the activities of other sidechains or of the main chain.

399
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And the fees that are paid on that sidechain would flow almost entirely to main chain miners through blind merge mining.

400
00:37:28,690 --> 00:37:41,690
So the drivechain view on the ordinals and inscriptions, like what Udi and Eric are doing, the drivechain view is really the opposite of what the toxic maximalists think.

401
00:37:41,690 --> 00:37:59,690
So a lot of people in Bitcoin, I'm not going to name them, but some people have criticized the ordinals and inscriptions as unethical, as harming the children, as interfering with the very important message of sound money.

402
00:37:59,690 --> 00:38:10,690
But we believe that this makes Bitcoin stronger when there's more users, more transactions fees being paid, and more people downloading nodes and learning about the technology.

403
00:38:10,690 --> 00:38:17,690
It is essential that Bitcoin be the place where exciting, innovative things are being done.

404
00:38:17,690 --> 00:38:33,690
The market for creativity and art, and also the market for storing data, these are massive markets, and Bitcoin could have an important role in those markets in the future.

405
00:38:33,690 --> 00:38:45,690
So it's important that Bitcoin enable these applications and activities and not attempt to shut them out, which would send them back to Ethereum.

406
00:38:45,690 --> 00:38:55,690
It's important for Bitcoin to be a place where everyone can get what they want, kind of like walking into Walmart, where they sell a million different things.

407
00:38:55,690 --> 00:38:58,690
And that's why Walmart is one of the largest companies in the whole world.

408
00:38:59,690 --> 00:39:01,690
They don't turn away any kind of customer.

409
00:39:01,690 --> 00:39:03,690
Whatever you want, you can find there.

410
00:39:03,690 --> 00:39:05,690
Bitcoin needs to be like that.

411
00:39:05,690 --> 00:39:13,690
So we think that what you're doing is cool and good with being interested in inscriptions and that kind of thing.

412
00:39:13,690 --> 00:39:24,690
And we feel, we believe that with Drivechain, there would be more success for Bitcoin in those matters without any interference for others.

413
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For example, if Greg Foss or others don't, or Tomer Strohleit, like people who don't like this inscriptions activity because it raises the fees and prevents poor people in Africa from moving Bitcoin around on mainchain.

414
00:39:38,690 --> 00:39:54,690
Those concerns will stop when Bitcoin has a peer-to-peer thunder sidechain with large blocks, because people will be able to move their value around for less than a penny in fees on the sidechain that has the large blocks.

415
00:39:54,690 --> 00:39:56,690
And they'll be moving Bitcoin.

416
00:39:59,690 --> 00:40:02,690
Can you explain that to me like I'm five?

417
00:40:04,894 --> 00:40:15,894
Sure. There's a layered architecture with Drivechain, and people can opt in to whichever layer they feel is best for them.

418
00:40:15,894 --> 00:40:21,894
So if you're going to buy a cup of coffee, then you're going to want to buy that cup of coffee using Thunder sidechain.

419
00:40:21,894 --> 00:40:27,894
But if you're going to buy a house, you might want to buy the house using mainchain Bitcoin.

420
00:40:27,894 --> 00:40:38,894
On mainchain, the fee might be $50. But on the Thunder sidechain, the fee might be one tenth of a penny.

421
00:40:38,894 --> 00:40:51,894
So that's the difference, is that on the Thunder sidechain, there's very high throughput, very high block size, a one gigabyte block size, and very low fees.

422
00:40:52,894 --> 00:41:02,894
It's all peer-to-peer. That's the key. It's Bitcoin. It's the same design as Bitcoin. There are nodes, there are miners, and there's a unit of account.

423
00:41:02,894 --> 00:41:13,894
And it's peer-to-peer. And most importantly, the token that you're using on each level of the system is Bitcoin.

424
00:41:13,894 --> 00:41:23,894
It's one Bitcoin. That's the token. Infinitely divisible, one Bitcoin, and you can have it on mainchain, or you can move it around on the higher level.

425
00:41:23,894 --> 00:41:29,894
And on the higher level, the fees are much lower, and there is less decentralization.

426
00:41:29,894 --> 00:41:37,894
But you don't need maximum decentralization when you're buying a cup of coffee.

427
00:41:38,894 --> 00:41:48,894
Yo, welcome to the stage, 0xMetaPanda, founder of Endanger Labs.

428
00:41:48,894 --> 00:41:52,894
Yo, what's good, everyone? Yeah, just MetaPanda.

429
00:41:52,894 --> 00:42:00,894
Yeah, no, this is super interesting. We're also building on Bitcoin, launching our first digital identity offering over there pretty soon.

430
00:42:01,894 --> 00:42:07,894
I actually just tried joining the Telegram twice, but it automatically kicked me.

431
00:42:07,894 --> 00:42:09,894
Oh man, I'm so sorry.

432
00:42:09,894 --> 00:42:24,894
Yeah, so in the Telegram group for Drivechain, we have a very robust anti-spam feature where people who don't perfectly complete the captcha don't get allowed to stay in.

433
00:42:24,894 --> 00:42:31,894
Maybe it's too aggressive, but what you have to do is you have to be in the general topic.

434
00:42:31,894 --> 00:42:36,894
There's different topics, like technical support, off-topic, and then general.

435
00:42:36,894 --> 00:42:43,894
If you're in the general one, that's where the captcha appears. You can try again in a few minutes. I think it'll then work.

436
00:42:43,894 --> 00:42:46,894
Yeah, I did it in general twice.

437
00:42:46,894 --> 00:42:49,894
Third time works a charm.

438
00:42:49,894 --> 00:42:53,894
I don't know what to tell you, but you're like the 100th person who's mentioned this.

439
00:42:53,894 --> 00:42:58,894
So yeah, we have a high bar, it's a high barrier to entry to get into that Telegram group.

440
00:42:58,894 --> 00:43:01,894
You've got to really do it just right, and then we'll work.

441
00:43:01,894 --> 00:43:06,894
I don't know what else to say, but we're aware of this issue and we apologize for it.

442
00:43:06,894 --> 00:43:13,894
Nah, no worries. I love it. Very big on security, OPSEC, so keep up the good work.

443
00:43:13,894 --> 00:43:18,894
Do you go to BitDevs? If you do, I encourage you to talk about Drivechain there.

444
00:43:18,894 --> 00:43:20,894
That's a great place to learn.

445
00:43:20,894 --> 00:43:24,894
Also, if you want to know what do all these thinkers think about Drivechain,

446
00:43:24,894 --> 00:43:28,894
like the people who talk a lot about Bitcoin at the conferences on stage,

447
00:43:28,894 --> 00:43:32,894
I've made a list of what they think about Drivechain.

448
00:43:32,894 --> 00:43:39,894
You can find it at drivechain.info forward slash friends.

449
00:43:39,894 --> 00:43:44,894
That's drivechain.info forward slash friends.

450
00:43:44,894 --> 00:43:51,894
And that will give you a list of what Adam Back, Fiatjaf, Mike Tidwell, John Light,

451
00:43:51,894 --> 00:43:54,894
and others have said about Drivechain.

452
00:43:54,894 --> 00:43:59,894
It's not like the negatives, it's only the positives.

453
00:43:59,894 --> 00:44:02,894
But the list of people who support it is very large,

454
00:44:02,894 --> 00:44:07,894
and I chose to just highlight who's a supporter, who likes it,

455
00:44:07,894 --> 00:44:12,894
who has a favorable attitude about it, who's excited about it.

456
00:44:12,894 --> 00:44:14,894
So I'll give you more context on this idea.

457
00:44:14,894 --> 00:44:19,894
Drivechain. It's an idea which has been growing within the Bitcoin community for eight years.

458
00:44:19,894 --> 00:44:23,894
It was first introduced in a blog post by Paul Sztorc.

459
00:44:23,894 --> 00:44:31,894
Later, Paul Sztorc and CryptAxe authored the Drivechain BIPs, BIP300 and 301.

460
00:44:31,894 --> 00:44:35,894
That's Bitcoin Improvement Proposal 300 and 301.

461
00:44:35,894 --> 00:44:45,894
Numbers were assigned, and you can read the BIPs publicly on the Bitcoin GitHub page.

462
00:44:45,894 --> 00:44:53,894
And later this year, there will be a pull request to merge the code into Bitcoin Core,

463
00:44:53,894 --> 00:45:00,894
which would be, if that's done, the final step in the first part of the Drivechain experience.

464
00:45:00,894 --> 00:45:08,894
The second part will be using Drivechain, where all these exciting sidechains will come to Bitcoin.

465
00:45:08,894 --> 00:45:14,894
But that can't happen until the maintainers of Bitcoin Core,

466
00:45:14,894 --> 00:45:19,894
acting on behalf of the community of Bitcoin users, merges the Drivechain BIPs.

467
00:45:19,894 --> 00:45:25,894
So right now, an exciting development is occurring where Luke Dashjr.,

468
00:45:25,894 --> 00:45:31,894
one of the most experienced Bitcoiners in the whole world, is rebasing the Drivechain code

469
00:45:32,894 --> 00:45:38,894
so it is perfectly ready to be merged into Bitcoin Core, which would launch Drivechain.

470
00:45:38,894 --> 00:45:46,894
And it would be a very exciting time, especially for people like me who are obsessed about it for many months, over a year.

471
00:45:46,894 --> 00:45:51,894
So a great big amount of stuff is happening this year.

472
00:45:51,894 --> 00:45:53,894
This is like a momentous time.

473
00:45:53,894 --> 00:45:58,894
And it couldn't be better for Drivechain because all kinds of things are happening right now.

474
00:45:58,894 --> 00:46:04,894
Like there's a fee crisis where the fees are higher, which is actually a good thing, not a crisis.

475
00:46:04,894 --> 00:46:08,894
So there's discussion of scaling.

476
00:46:08,894 --> 00:46:11,894
There's all this infighting over the ordinals and inscriptions.

477
00:46:11,894 --> 00:46:16,894
So Drivechain solves all these problems, we believe.

478
00:46:16,894 --> 00:46:18,894
I love that. Congrats, guys.

479
00:46:18,894 --> 00:46:21,894
This is actually incredible stuff.

480
00:46:21,894 --> 00:46:26,894
It's really awesome to see this level of innovation coinciding with the happening.

481
00:46:27,894 --> 00:46:32,894
Usually there's always some sort of catalyst where people are like, well, how are we going to get out of this bear market?

482
00:46:32,894 --> 00:46:35,894
And I think we're seeing it on Bitcoin.

483
00:46:35,894 --> 00:46:42,894
It's this incredible renaissance right now where Bitcoin had its first move for quite a while.

484
00:46:42,894 --> 00:46:46,894
And then Ethereum came along and then a lot of these alternative L1s.

485
00:46:46,894 --> 00:46:50,894
But now it's sort of like Bitcoin with the features of Ethereum.

486
00:46:50,894 --> 00:46:54,894
So I'm just super excited for this next cycle.

487
00:46:55,894 --> 00:46:56,894
Well said.

488
00:46:56,894 --> 00:47:00,894
I do have a different take on the halving.

489
00:47:00,894 --> 00:47:03,894
And it'll be interesting to see who's right, you or me.

490
00:47:03,894 --> 00:47:07,894
We don't know for sure whether the halving...

491
00:47:07,894 --> 00:47:10,894
Well, let me rephrase that.

492
00:47:10,894 --> 00:47:17,894
What the halving tells us is that every four years, approximately, the Coinbase is halved.

493
00:47:18,894 --> 00:47:23,894
And historically, people have been witnessing Bitcoin's price rise.

494
00:47:23,894 --> 00:47:26,894
And sometimes they attribute that to the halving.

495
00:47:26,894 --> 00:47:29,894
And this is the so-called stock-to-flow model.

496
00:47:29,894 --> 00:47:32,894
But it doesn't take into account demand.

497
00:47:32,894 --> 00:47:34,894
It just assumes demand is constant.

498
00:47:34,894 --> 00:47:45,894
And therefore, if there's half as much issuance, then the effect on the marginal buyer is that the price will have to rise as they bid to obtain Bitcoin.

499
00:47:46,894 --> 00:47:51,894
But there's no guarantee that the halving will send the price up.

500
00:47:51,894 --> 00:47:56,894
It's entirely possible that Bitcoin's price will not go up because of the halving.

501
00:47:56,894 --> 00:48:05,894
A much better, more fundamental economic understanding of Bitcoin is possible.

502
00:48:05,894 --> 00:48:15,894
Where we perceive correctly that the demand for Bitcoin is a function of whether or not it serves the needs of economic actors.

503
00:48:15,894 --> 00:48:28,894
The fact that the issuance halves every four years towards zero doesn't tell us anything about whether or not Bitcoin is valuable to people and whether it'll sustain demand from the market.

504
00:48:28,894 --> 00:48:33,894
For example, the halving occurs in Bitcoin Cash and BSV.

505
00:48:33,894 --> 00:48:43,894
But of course, none of us would say that there's more demand coming to Bitcoin Cash and BSV because of their halvings in the future.

506
00:48:43,894 --> 00:48:58,894
And mathematically and economically, we can say with total certainty that the economic effect of each halving, whatever that effect is, is half as much as every prior halving.

507
00:48:58,894 --> 00:49:07,894
So in other words, as a result of the nature of halvings, each one is half as important as the prior one.

508
00:49:07,894 --> 00:49:09,894
And we've had a number of them.

509
00:49:09,894 --> 00:49:26,894
For example, in 50 years from now, when the amount of the Coinbase is 0.00 whatever, and then it halves to 0.0005 Bitcoin, that's not going to have any effect on the market.

510
00:49:27,894 --> 00:49:32,894
And the very last halving will be so infinitesimally insignificant.

511
00:49:32,894 --> 00:49:36,894
Of course, people will pay attention to the last one in 100 years because it's the last.

512
00:49:36,894 --> 00:49:42,894
So it's interesting, kind of like an inscription that's like 999,000, like the last one before the million.

513
00:49:42,894 --> 00:49:46,894
But my point is that people talk too much about the halving.

514
00:49:46,894 --> 00:49:52,894
And it's sort of like economically uninformed and simplistic, in my opinion.

515
00:49:52,894 --> 00:50:12,894
And what's much more important is such things as generating noncustodial scaling, ensuring that Bitcoin has large blocks for noncustodial scaling, ensuring Bitcoin has a high fee revenue to miners via merged mining of many successful sidechains.

516
00:50:12,894 --> 00:50:13,894
That's what we need to have.

517
00:50:13,894 --> 00:50:21,894
Today, there's only about 3 Bitcoin per month is coming to Bitcoin miners from Rootstock.

518
00:50:21,894 --> 00:50:23,894
It's not a lot of money.

519
00:50:23,894 --> 00:50:27,894
It needs to be 3,000 Bitcoin per month.

520
00:50:27,894 --> 00:50:29,894
It needs to be 30,000.

521
00:50:29,894 --> 00:50:35,894
We have to have merged mining be the source of revenue for Bitcoin miners in the future.

522
00:50:35,894 --> 00:50:40,894
We need to have every single blockchain paying fees to Bitcoin.

523
00:50:40,894 --> 00:50:43,894
This is necessary for Bitcoin's success.

524
00:50:43,894 --> 00:50:56,894
The only way we're going to see very high value for Bitcoin in the future is if Bitcoin has very high transaction finality due to very high fee revenue.

525
00:50:56,894 --> 00:51:00,894
The fees are what generate the transaction finality.

526
00:51:01,894 --> 00:51:13,894
The transaction finality, in other words, the economic security or the security budget, the robustness of Bitcoin to thwart a hostile 51% miner.

527
00:51:13,894 --> 00:51:16,894
Bitcoin needs high fees for that.

528
00:51:16,894 --> 00:51:20,894
We can't rely on the subsidy, which is halved every four years.

529
00:51:20,894 --> 00:51:24,894
We need to have high fees flowing constantly to Bitcoin miners.

530
00:51:25,894 --> 00:51:36,894
The vision of Drivechain is that we have, let's say, 20 sidechains, each with a market capitalization of $100 billion.

531
00:51:36,894 --> 00:51:42,894
They're all sending millions and millions of dollars of fees every day to Bitcoin miners.

532
00:51:43,894 --> 00:51:50,894
This would result in the security budget of each sidechain being the fees paid on that specific sidechain.

533
00:51:50,894 --> 00:51:56,894
And then, amazingly, the security budget of the mainchain will be three things.

534
00:51:56,894 --> 00:52:00,894
The coinbase on the mainchain, that's part of the revenue.

535
00:52:00,894 --> 00:52:03,894
And then the fees paid on the mainchain.

536
00:52:03,894 --> 00:52:06,894
And then, importantly, the fees paid on the sidechains.

537
00:52:07,894 --> 00:52:22,894
As a result of many merged-mind sidechains sending fees to the mainchain on layer one, the security budget of the mainchain is the sum of the coinbase on the mainchain, the fees on the mainchain, and the fees on the sidechain.

538
00:52:22,894 --> 00:52:35,894
As Drivechain advocates, what we want to see is a lot of fees being received onto the mainchain from all these merged-mind, fascinating and varied, innovative sidechains.

539
00:52:35,894 --> 00:52:38,894
A sidechain like HiveMind for peer-to-peer oracles.

540
00:52:38,894 --> 00:52:45,894
A sidechain like Thunder for one-gigabyte-block, large-block Bitcoin, high-throughput transactions.

541
00:52:45,894 --> 00:52:48,894
A sidechain for BitAssets, like NFTs.

542
00:52:48,894 --> 00:52:51,894
BitNames, the DNS-focused sidechain.

543
00:52:51,894 --> 00:52:58,894
All these different, amazing, technological breakthrough sidechains on Bitcoin paying fees to the mainchain.

544
00:52:58,894 --> 00:53:01,894
That is what's going to make Bitcoin be very strong.

545
00:53:01,894 --> 00:53:03,894
It's kind of like a safe.

546
00:53:04,894 --> 00:53:14,894
If a safe is well-designed and has very thick steel walls and it's bolted to the floor, then it's a robust safe that's hard to steal from.

547
00:53:14,894 --> 00:53:17,894
People might put their gold bars in that safe.

548
00:53:17,894 --> 00:53:25,894
But if the safe is weak and flimsy over time and getting weaker and weaker, then people aren't going to want to store their money there.

549
00:53:25,894 --> 00:53:35,894
So if Bitcoin has a diminishing security budget in the future due to halvings and low fees, that's a recipe for disaster.

550
00:53:35,894 --> 00:53:46,894
So one of the most controversial things that drive-chainers understand correctly, I believe, is the security budget problem and the need to have high fees in the future.

551
00:53:46,894 --> 00:53:54,894
People just wrongfully assume—wrongly assume, not wrongfully, but wrongly assume—that Bitcoin will have high fees.

552
00:53:54,894 --> 00:53:59,894
They've been thinking that for years, even though we're 13 years in, roughly.

553
00:53:59,894 --> 00:54:01,894
The fees are still pretty low.

554
00:54:01,894 --> 00:54:06,894
It only costs a dollar to send a Bitcoin transaction the last time I checked yesterday.

555
00:54:06,894 --> 00:54:09,894
It needs to be back to $50.

556
00:54:09,894 --> 00:54:16,894
$50 is where Greg Maxwell said in December of 2017 that he's breaking out the champagne, at $50.

557
00:54:16,894 --> 00:54:24,894
That was a daily revenue of, I think, north of like $20 million a day of fees for Bitcoin miners.

558
00:54:24,894 --> 00:54:27,894
Today, it's much less than that.

559
00:54:27,894 --> 00:54:32,894
We're at a fraction of what he thought was worthy of celebrating with champagne.

560
00:54:32,894 --> 00:54:34,894
So we have to get the fees up.

561
00:54:34,894 --> 00:54:46,894
And it's funny that within Bitcoin discourse, all we see are mostly like Pierre Richard yesterday, who I respect very much, writing that the security budget is a nonsense concept.

562
00:54:46,894 --> 00:54:50,894
And we don't need high fees unless Bitcoin's being attacked.

563
00:54:50,894 --> 00:54:56,894
And if we do have high fees when Bitcoin's being attacked, then it's wasteful.

564
00:54:56,894 --> 00:54:57,894
We're wasting the fees.

565
00:54:57,894 --> 00:54:59,894
So that's what Pierre Richard said.

566
00:54:59,894 --> 00:55:06,894
Now, if you look at what the Ethereum people say, it's the exact opposite.

567
00:55:06,894 --> 00:55:14,894
It's so fascinating to see these echo chambers, like within Bitcoin, where people are saying, don't worry about low fees.

568
00:55:14,894 --> 00:55:15,894
It's not a problem.

569
00:55:15,894 --> 00:55:18,894
In fact, let's make sure we're not wastefully overpaying.

570
00:55:18,894 --> 00:55:20,894
Bitcoin doesn't have a security budget.

571
00:55:20,894 --> 00:55:22,894
Don't listen to people who use that phrase.

572
00:55:22,894 --> 00:55:24,894
That's what some Bitcoiners say.

573
00:55:24,894 --> 00:55:26,894
And I think they're mistaken.

574
00:55:26,894 --> 00:55:30,894
Now, if you read what Vitalik says, it's the opposite.

575
00:55:30,894 --> 00:55:36,894
He and all the Ethereum maxis would say, Bitcoin has a problem.

576
00:55:36,894 --> 00:55:37,894
The fees are low.

577
00:55:37,894 --> 00:55:41,894
When the halving runs out, Bitcoin will devalue.

578
00:55:41,894 --> 00:55:45,894
And they are exactly right, I believe.

579
00:55:45,894 --> 00:55:48,894
Unless Bitcoin does drivechain.

580
00:55:48,894 --> 00:55:51,894
Drivechain or something like it.

581
00:55:51,894 --> 00:55:58,894
Drivechain or something like it, which would bring fees to the main chain from blockchains outside of Bitcoin.

582
00:55:58,894 --> 00:56:02,894
That's the essence of drivechain is you have a multitude of sidechains.

583
00:56:02,894 --> 00:56:04,894
All of them have no coins on them.

584
00:56:04,894 --> 00:56:15,894
And then Bitcoin users are sending coins to the sidechain, maintaining Bitcoin's monetary policy while expanding Bitcoin's technological capabilities.

585
00:56:16,894 --> 00:56:25,894
And that sidechains have to be peer-to-peer, meaning no one is socially selected to participate in any role.

586
00:56:25,894 --> 00:56:27,894
That's what peer-to-peer means, in my view.

587
00:56:27,894 --> 00:56:39,894
If no one is socially selected for any particular role and anyone who's willing to spend some money to buy some ASICs can participate in the security model, then the security model is peer-to-peer.

588
00:56:39,894 --> 00:56:41,894
Then the sidechain is peer-to-peer.

589
00:56:42,894 --> 00:56:49,894
Peer-to-peer doesn't mean that everyone you're interacting with is equal to you in some sense.

590
00:56:49,894 --> 00:56:53,894
What peer-to-peer means is no one is socially selected.

591
00:56:53,894 --> 00:56:55,894
No one is privileged.

592
00:56:55,894 --> 00:56:59,894
That is the correct definition of peer-to-peer, in my opinion.

593
00:57:00,894 --> 00:57:17,894
So what we want as drive chainers is a multitude of sidechains, all of them peer-to-peer, built on Bitcoin, where Bitcoin users can send a unit of Bitcoin to the sidechain, transact with that unit of account, that synthetic Bitcoin.

594
00:57:17,894 --> 00:57:24,894
And then when they're done, eventually send it back down to main chain to use main chain again.

595
00:57:24,894 --> 00:57:33,894
And we have to have this arrangement such that all the sidechain fees are collected to the main chain.

596
00:57:33,894 --> 00:57:35,894
So that's the brilliant thing about drivechain.

597
00:57:35,894 --> 00:57:38,894
It doesn't just open up more technological possibilities.

598
00:57:38,894 --> 00:57:43,894
It solves the security budget, potentially.

599
00:57:43,894 --> 00:57:49,894
Bitcoin just simply must aspire to collect every single blockchain user in the whole world.

600
00:57:49,894 --> 00:57:51,894
We have to aim for that.

601
00:57:51,894 --> 00:57:54,894
We have to aim that every single application can be on Bitcoin.

602
00:57:54,894 --> 00:57:56,894
Every user can use Bitcoin.

603
00:57:56,894 --> 00:58:01,894
We can't have it be that people must go to an altcoin to do something.

604
00:58:01,894 --> 00:58:12,894
And the more that Bitcoin embraces that narrow mandate, the more the altcoins will thrive.

605
00:58:12,894 --> 00:58:14,894
Welcome to everyone in the audience.

606
00:58:14,894 --> 00:58:16,894
This is Drivechain Twitter Spaces by LayerTwo Labs.

607
00:58:17,894 --> 00:58:23,894
We go every Monday and Thursday to talk about drivechain and related concepts.

608
00:58:23,894 --> 00:58:25,894
Everyone's welcome to come on up to the stage.

609
00:58:25,894 --> 00:58:32,894
You can raise your hand to ask a question or share a comment.

610
00:58:32,894 --> 00:58:33,894
Don't be shy.

611
00:58:33,894 --> 00:58:34,894
Raise your hand.

612
00:58:34,894 --> 00:58:36,894
Come on up.

613
00:58:36,894 --> 00:58:37,894
Tell me how I'm wrong.

614
00:58:37,894 --> 00:58:42,894
Go for it.

615
00:58:42,894 --> 00:58:48,894
Welcome to all the new faces I see and welcome to the familiar ones.

616
00:58:48,894 --> 00:58:52,894
It was great to meet some of you at the recent Bitcoin Miami event.

617
00:58:52,894 --> 00:58:56,894
We hope for those who weren't there that you've enjoyed reviewing our tweets.

618
00:58:56,894 --> 00:59:06,894
We put out a lot of videos on our LayerTwo Labs Twitter of our friends and newcomers visiting our booth.

619
00:59:06,894 --> 00:59:21,894
We had thousands of people visit our booth to collect all of the T-shirts and sunglasses, shot glasses and other things that we handed out, as well as they wanted to take part in the fun act of smashing the pinatas that we had.

620
00:59:21,894 --> 00:59:24,894
Welcome to our speakers.

621
00:59:24,894 --> 00:59:26,894
We have two speakers joining the stage.

622
00:59:27,894 --> 00:59:36,894
Hello, Paul, and hello, SuperTestNet.

623
00:59:36,894 --> 00:59:37,894
Hello.

624
00:59:37,894 --> 00:59:39,894
I just thought I would join, too.

625
00:59:39,894 --> 00:59:49,894
I was sort of listening before, but we were busy doing real work, so now I would get the speaker microphone if I need it.

626
00:59:50,894 --> 00:59:59,894
I don't have anything in particular to say right now, just that we're working on some cool—I guess we could talk about stuff that we're doing.

627
00:59:59,894 --> 01:00:02,894
We're working on Namecoin as a sidechain.

628
01:00:04,566 --> 01:00:08,566
It's a high-performance sidechain, but I don't know. Those are details.

629
01:00:08,566 --> 01:00:12,566
I just wanted to grab the microphone option in case I need it.

630
01:00:12,566 --> 01:00:16,566
What's up, SuperTestNet? Nice seeing you at Miami. Had a great time.

631
01:00:16,566 --> 01:00:19,566
Did you come to our booth? We gave away a bunch of stuff.

632
01:00:19,566 --> 01:00:23,566
I never did get to your booth and actually never made it to the conference at all.

633
01:00:23,566 --> 01:00:26,566
I just hung out in Miami with my friends.

634
01:00:26,566 --> 01:00:46,566
I got some good slides for that one. I think I posted them, but I should tweet them or something.

635
01:00:46,566 --> 01:00:49,566
I'll tweet them.

636
01:00:49,566 --> 01:01:04,566
Super, which sidechain excites you the most? Would it be the Thunder large block sidechain, the Hivemind Oracle sidechain, or the DNS sidechain, or a different one?

637
01:01:04,566 --> 01:01:07,566
The Thunder one. Thunderblocks? Is that what it was called?

638
01:01:07,566 --> 01:01:08,566
Thunder.

639
01:01:08,566 --> 01:01:17,566
I think I actually may have whatever-pilled, drive-pilled Adam back on that a little bit.

640
01:01:17,566 --> 01:01:21,566
He was also thinking about it himself. He came to me and he was like, well, this.

641
01:01:21,566 --> 01:01:30,566
Then I sent him my written article about it, and then he just tweeted about it two hours ago or something.

642
01:01:31,566 --> 01:01:42,566
He's the originator of a different idea called the extension block from December 2014, which is a fascinating idea in its own right.

643
01:01:42,566 --> 01:01:48,566
These are historical details that maybe people are interested in, maybe probably not.

644
01:01:48,566 --> 01:01:51,566
Let me post these slides. I'm going to tweet these slides.

645
01:02:00,566 --> 01:02:10,566
Super, have you seen the GitHub page for the Thunder sidechain?

646
01:02:10,566 --> 01:02:12,566
No.

647
01:02:12,566 --> 01:02:13,566
Okay.

648
01:02:13,566 --> 01:02:27,566
There is a GitHub, but I also have a blog post, which I think is more important for people to understand that it's not the same as naive layer one large blockism, because that is a bad idea, but that's not this idea.

649
01:02:27,566 --> 01:02:30,566
It is also, which is very important.

650
01:02:30,566 --> 01:02:34,566
Also, I just give a lot of context, like reframing.

651
01:02:34,566 --> 01:02:41,566
Let's say it's like an airplane where you have some first class transactions that pay the high fee.

652
01:02:41,566 --> 01:02:43,566
They would be first class.

653
01:02:43,566 --> 01:02:53,566
Layer one Bitcoin is first class, but then you have Coach, where it's a shittier node experience, because the node is more expensive and whatever.

654
01:02:54,566 --> 01:03:02,566
But it's cheaper, and so sometimes you want first class, sometimes you want business class, sometimes you want Coach.

655
01:03:02,566 --> 01:03:05,566
Shouldn't we just have them all in the same airplane?

656
01:03:05,566 --> 01:03:16,566
I don't know if I can easily share that, but I just call it Thunder as a little bit of a joke, like a lightning joke, of course.

657
01:03:16,566 --> 01:03:18,566
But it's a great article.

658
01:03:19,566 --> 01:03:23,566
I can link to it if you just search something for scaling.

659
01:03:23,566 --> 01:03:26,566
So you said it's not the same as naive layer one big blocks.

660
01:03:26,566 --> 01:03:29,566
Is it the same as naive layer two big blocks?

661
01:03:29,566 --> 01:03:31,566
Because that's kind of what I was hoping for.

662
01:03:31,566 --> 01:03:37,566
It is slightly different than just naive layer two, but basically something like that.

663
01:03:38,566 --> 01:03:48,566
Some of the things people don't grasp is you can fail safe with layer two, whereas if layer one fails, you're dead.

664
01:03:48,566 --> 01:03:50,566
Layer two can just kind of pause.

665
01:03:50,566 --> 01:03:54,566
As long as layer one is still working, layer two fails, but it's just on pause.

666
01:03:54,566 --> 01:03:56,566
It can come pause and come back.

667
01:03:56,566 --> 01:04:09,566
Layer two, the chains can have like a pyramid hierarchical structure of some kind where they have like zones, and they work as a team.

668
01:04:09,566 --> 01:04:17,566
So like one of them is like for maybe the East Coast of the United States, and another one is for Southeast Asia,

669
01:04:17,566 --> 01:04:25,566
where situations where most people make transactions among themselves, but they do not transact with anyone outside their zone.

670
01:04:25,566 --> 01:04:34,566
Another thing people don't understand is the main failure mode of the large block sidechain is that the nodes are censored,

671
01:04:34,566 --> 01:04:42,566
but it's possible for, for example, let's say you have the node, all the nodes that serve the people of China.

672
01:04:42,566 --> 01:04:47,566
Everyone in China is using SPV node, but all the full nodes are in a different country.

673
01:04:47,566 --> 01:04:52,566
The Chinese government cannot ban the nodes that are in the United States,

674
01:04:53,566 --> 01:04:57,566
and the United States government can really not ban the nodes that are in Switzerland,

675
01:04:57,566 --> 01:05:04,566
and the Swiss government can't ban the nodes that are in whatever, Djibouti or whatever they are.

676
01:05:04,566 --> 01:05:09,566
So actually these are a lot of things that I think people just don't keep in mind,

677
01:05:09,566 --> 01:05:16,566
and then what people should keep in mind is the potential upside of being able to give everyone a UTXO,

678
01:05:16,566 --> 01:05:20,566
all eight billion people in the world, their own UTXOs.

679
01:05:20,566 --> 01:05:25,566
Finally, another thing that people don't appreciate is that different transactions are different.

680
01:05:25,566 --> 01:05:30,566
So you have a coffee transaction. It doesn't really need a lot of decentralization.

681
01:05:30,566 --> 01:05:35,566
So why would we compete with Venmo credit cards? They are centralized.

682
01:05:35,566 --> 01:05:42,566
We should have a deliberately more centralized option just so that we have the whole spectrum of stuff.

683
01:05:42,566 --> 01:05:49,566
So I talk about this in the article, truthcoin.info.com.

684
01:05:49,566 --> 01:05:55,566
I think the article is a good one to read because it's mind-expanding.

685
01:05:55,566 --> 01:06:02,566
If you want to fit in on Bitcoin Twitter, then you should not read it because you will become enlightened,

686
01:06:02,566 --> 01:06:06,566
and then you will be alienated from the experience of the common man.

687
01:06:06,566 --> 01:06:17,566
But if you want to achieve greatness and ascend into a transcendental religious plane of pure knowledge

688
01:06:17,566 --> 01:06:23,566
and innovation and progress, then maybe you could read it and think about it a little bit.

689
01:06:23,566 --> 01:06:29,566
Well, I like this version of Paul Sztorc. Where did this version of Paul Sztorc come from, the guru version?

690
01:06:29,566 --> 01:06:33,566
It's all because of the magic of the Bitcoin conference.

691
01:06:33,566 --> 01:06:36,566
Have you been listening to Tony Robbins?

692
01:06:36,566 --> 01:06:41,566
Of course not. I sure don't. I should add more Tony Robbins. That would help Bitcoin 300.

693
01:06:41,566 --> 01:06:46,566
I think anyone who's met and chatted with Super, as I recently was fortunate to,

694
01:06:46,566 --> 01:06:50,566
can tell immediately that he is definitely of that kind of mindset.

695
01:06:50,566 --> 01:07:01,566
He is 100% interested in the truth, not at all interested in any kind of superficial posturing or community clout.

696
01:07:01,566 --> 01:07:08,566
He's the kind of independent thinker who is moving Bitcoin forward through science 100%.

697
01:07:08,566 --> 01:07:12,566
I may not be interested in clout, but keep saying stuff like that. It really builds my ego up.

698
01:07:12,566 --> 01:07:19,566
I think people like you really move the conversation forward because it's just so clear to everyone that you're a builder,

699
01:07:19,566 --> 01:07:25,566
that you have the highest class of knowledge, which is someone who's able to actually build a whole application,

700
01:07:25,566 --> 01:07:30,566
like a full-blown coder focused on Bitcoin, Lightning and Nostr.

701
01:07:30,566 --> 01:07:37,566
So it's really great to have you in the sidechain community, and I'm really genuinely excited to see what you do.

702
01:07:37,566 --> 01:07:41,566
If Drivechain is launched, it's people like you, and the few people like you,

703
01:07:41,566 --> 01:07:48,566
who will be able to actually build entire sidechains that are very successful, that accrue billions of dollars of value.

704
01:07:48,566 --> 01:07:53,566
It takes a lot of mastery to probably design that kind of thing.

705
01:07:53,566 --> 01:08:03,566
I have to say, what you see in others also exists in you.

706
01:08:03,566 --> 01:08:12,566
So I just really like that you're uplifting the community. I think this is so rare to see.

707
01:08:12,566 --> 01:08:20,566
Well, the exciting thing about Drivechain is to know that we're going to be vindicated, whatever happens.

708
01:08:20,566 --> 01:08:26,566
Because there's no way, I think, that we're wrong.

709
01:08:26,566 --> 01:08:34,566
Because either Bitcoin does Drivechain, or something like it, and is very successful, or Bitcoin doesn't,

710
01:08:34,566 --> 01:08:41,566
and then some other chain will, and that chain eventually would probably out-compete Bitcoin.

711
01:08:41,566 --> 01:08:50,566
So whatever happens, Drivechain or something like it will become the world's blockchain that has the ossified Layer 1,

712
01:08:50,566 --> 01:08:55,566
the highly extensible Layer 2s, and that will take over.

713
01:08:55,566 --> 01:09:01,566
It'll be the most popular and successful thing in the whole realm of blockchain, money and software.

714
01:09:01,566 --> 01:09:06,566
Just be careful when you think there's no way you can be wrong. It's a dangerous place to be.

715
01:09:06,566 --> 01:09:09,566
Of course, of course. I mean, there could be some oversight or problem.

716
01:09:09,566 --> 01:09:15,566
So it's exciting to find out whether we're right, right? What do you think, Cooper?

717
01:09:15,566 --> 01:09:20,566
I think you're right. I think you're probably right. Like 99.8%.

718
01:09:20,566 --> 01:09:29,566
I think there could be something. I mean, let me list some ways we could be wrong, even though I definitely think that we're right.

719
01:09:29,566 --> 01:09:40,566
But I think that one way is it could be the case that, for some reason, all blockchains just don't work without the block reward at all.

720
01:09:40,566 --> 01:09:46,566
And if you have only transaction fees, something about that doesn't work in a different way,

721
01:09:46,566 --> 01:09:53,566
like in whether or not blocks make forward progress, because there's something called fee sniping,

722
01:09:53,566 --> 01:10:00,566
and there's this old paper called Mind the Gap that I thought it wasn't actually very good, but at least it raises the right problem.

723
01:10:00,566 --> 01:10:05,566
And that would be interesting. And what would be interesting about that is it would kind of be like a canary in the coal mine.

724
01:10:05,566 --> 01:10:15,566
And it would indicate that Bitcoin layer one main chain also will eventually not work because the block subsidy will trend to zero.

725
01:10:16,566 --> 01:10:24,566
That's possible. It's possible that something like – I really don't believe in this ZK-SNARK supremacy thing,

726
01:10:24,566 --> 01:10:32,566
but I suppose it's possible that someone would have a version of this that just has the ZK-SNARK stapled on,

727
01:10:32,566 --> 01:10:39,566
and that for whatever reason, people like – that would really not be significantly different from this project,

728
01:10:39,566 --> 01:10:43,566
because of the data availability problem is not solved at all by ZK-SNARK.

729
01:10:43,566 --> 01:10:53,566
So that would just be like this problem. It would just be BIP300. It would be drivechain plus ZK-SNARK, drive SNARK, or whatever.

730
01:10:53,566 --> 01:11:02,566
And so that would not be that different. And I think another way might be that we could theoretically be wrong.

731
01:11:03,566 --> 01:11:11,566
I'm really scraping the bottom of the barrel here, but if network effects are just so strong, like the QWERTY keyboard level strong,

732
01:11:11,566 --> 01:11:22,566
where just something is big and people are absolutely – no matter how stupid we get, and Bitcoin just becomes more and more successful,

733
01:11:22,566 --> 01:11:29,566
and no matter how complacent we sort of become – I think we have been very complacent for the last five, six, seven years.

734
01:11:29,566 --> 01:11:34,566
There hasn't been a lot of novelty. There has not been a lot of novelty in Bitcoin.

735
01:11:34,566 --> 01:11:41,566
And I think maybe that's just the case. The problem with that is, though, it really predicts that the U.S. dollar will just destroy everything.

736
01:11:41,566 --> 01:11:50,566
It will just conquer every fiat currency, and then it will just be so big that people will need there to be an exchange between BTC and the U.S. dollar,

737
01:11:50,566 --> 01:11:55,566
and then they'll just be able to close down all the exchanges or something.

738
01:11:56,566 --> 01:12:03,566
So that's kind of a dark – the network effect. But I think the network effect is tough, because no matter how strong network effects are,

739
01:12:03,566 --> 01:12:12,566
like Silk Road, you could only use Bitcoin there. And Bitcoin grew from having zero users to having a market cap of $1 trillion.

740
01:12:12,566 --> 01:12:19,566
So how can you explain – if you have a network effect-only story, how do you explain that?

741
01:12:19,566 --> 01:12:30,566
I have a quick question. Paul, the wrapped Bitcoin product is totally centralized through BitCo, as I understand, if I understand correctly.

742
01:12:30,566 --> 01:12:32,566
And yet it has –

743
01:12:32,566 --> 01:12:41,566
There are a couple of different ones. I don't know. I think WBTC is not – which one is the one that is? Maybe I get them mixed up.

744
01:12:41,566 --> 01:12:49,566
I think WBTC has a market cap of $4 billion, and I assume there's a 15-party multisig that the company is managing.

745
01:12:49,566 --> 01:12:54,566
So it's centralized but somewhat successful – $4 billion. Much bigger than Liquid or Rootstock.

746
01:12:54,566 --> 01:13:02,566
What if we built a Thunder sidechain that was a clone of Bitcoin, but not peer-to-peer, but instead had a multisig?

747
01:13:02,566 --> 01:13:09,566
Maybe it would take off, and that would demonstrate the possibility of sidechains being good,

748
01:13:09,566 --> 01:13:15,566
and then people would want to improve it even further by making it peer-to-peer through drivechain. Could we try that?

749
01:13:20,566 --> 01:13:23,566
What do we do? We launch Thunder, and then what do we do?

750
01:13:23,566 --> 01:13:27,566
We launch Thunder, and we promise not to run away with the money.

751
01:13:27,566 --> 01:13:30,566
As a federated sidechain?

752
01:13:30,566 --> 01:13:32,566
Oh, with no BIP300?

753
01:13:32,566 --> 01:13:34,566
Right.

754
01:13:34,566 --> 01:13:38,566
I don't think people would be very persuaded by that. They would just say they're just going to steal it.

755
01:13:38,566 --> 01:13:45,566
But I think RackBitcoin is not peer-to-peer. Someone's trusting them with $4 billion.

756
01:13:47,566 --> 01:13:58,566
They're also not trying to be specifically a scaling solution. They're trying to make it so you can use Bitcoin on DeFi, which is a bit of a different – there's a bit of a demand gap there.

757
01:13:59,566 --> 01:14:02,566
Yeah, they have a rising debt trend.

758
01:14:07,566 --> 01:14:15,566
I was thinking that if we could get more value into the federated sidechains that we have today, that would help the cause of drivechain,

759
01:14:15,566 --> 01:14:24,566
because then people would see that something similar is doing well, and they would want to be able to elevate it further.

760
01:14:24,566 --> 01:14:30,566
I think that the Rootstock people are kind of doing that, because their whole thing is that as soon as we have drivechain, they'll switch to that.

761
01:14:30,566 --> 01:14:36,566
But in the meantime, they're going to use the federated thing, which seems like a good – I think that's reasonable.

762
01:14:36,566 --> 01:14:38,566
Exactly.

763
01:14:38,566 --> 01:14:45,566
But yeah, maybe just becoming Rootstock shillers would be the way, because they're already doing that.

764
01:14:45,566 --> 01:14:49,566
Right, but they're not doing exactly what Thunder is.

765
01:14:50,566 --> 01:14:59,566
Well, I don't know about exactly, but if Thunder has bigger blocks, Rootstock does have bigger blocks than Bitcoin.

766
01:14:59,566 --> 01:15:02,566
So it's got that aspect of it, too.

767
01:15:02,566 --> 01:15:04,566
Yes, you're right.

768
01:15:07,566 --> 01:15:09,566
It's great that Rootstock is there.

769
01:15:09,566 --> 01:15:13,566
Or at least it could have bigger blocks if anyone was using it.

770
01:15:14,566 --> 01:15:19,566
They have some users. They've got Sovereign built on top of Rootstock.

771
01:15:19,566 --> 01:15:24,566
Gabriel Kerman, one of the co-founders, was here a few weeks ago in this Twitter space,

772
01:15:24,566 --> 01:15:29,566
and said that they're generating three Bitcoin per month in transaction fees for Bitcoin miners.

773
01:15:31,566 --> 01:15:39,566
Yeah, I'm looking at their block explorer right now, and it's just a string of empty blocks with no transactions in them.

774
01:15:40,566 --> 01:15:44,566
Two transactions in this one, four in the one before that, one in the one before that.

775
01:15:44,566 --> 01:15:47,566
There's just very little usage of the actual thing.

776
01:15:47,566 --> 01:15:50,566
Every little bit helps for the security budget.

777
01:15:51,566 --> 01:15:58,566
Yeah, but I think these federated things are potentially cool.

778
01:15:58,566 --> 01:16:02,566
It's just that Bitcoiners don't really seem to want to use them all very much.

779
01:16:02,566 --> 01:16:06,566
I guess except for wrapped Bitcoin, people do seem to use that.

780
01:16:06,566 --> 01:16:11,566
One very cool metric is that about half of Bitcoin's hash rate is merged mining Rootstock.

781
01:16:11,566 --> 01:16:17,566
I would assume that's just a few pools is all it takes to get to half, but that's still a large number.

782
01:16:20,566 --> 01:16:23,566
I feel like Paul's baffled that we're talking about Rootstock.

783
01:16:23,566 --> 01:16:27,566
Paul, can you save us from talking about non-Drivechain-y things?

784
01:16:29,566 --> 01:16:33,566
I think Rootstock, well, Rootstock, there's some weird questions about it.

785
01:16:34,566 --> 01:16:40,566
Of course, the Rootstock guys are great, but the point of Rootstock is supposed to be,

786
01:16:40,566 --> 01:16:44,566
okay, does anyone like Ethereum? We'll do Ethereum on Bitcoin.

787
01:16:46,566 --> 01:16:50,566
And I don't know, they seem to do a lot of other stuff.

788
01:16:50,566 --> 01:16:54,566
They have a huge website with lots of stuff on it.

789
01:16:55,566 --> 01:17:02,566
I guess they're building Rootstock versions of a lot of ETH things, which is great, I guess.

790
01:17:03,566 --> 01:17:06,566
With Liquid or with the Federation, I don't know.

791
01:17:06,566 --> 01:17:13,566
We're in a weird situation where Matt Corral publicly tweeted that

792
01:17:13,566 --> 01:17:18,566
it should only be used for sending coins among exchanges.

793
01:17:22,566 --> 01:17:26,566
And I think he literally said in the tweet, if anyone talks about it in a different way,

794
01:17:26,566 --> 01:17:29,566
you should mistrust them.

795
01:17:30,566 --> 01:17:34,566
And he's like the creator of Liquid, sort of, one of the co-creators.

796
01:17:36,566 --> 01:17:39,566
I don't know. I think, I don't know.

797
01:17:39,566 --> 01:17:42,566
It's also possible that there will be no demand, like,

798
01:17:42,566 --> 01:17:47,566
it's possible that there's no demand for any of the actual end uses at all,

799
01:17:47,566 --> 01:17:52,566
and the whole thing is like just sociopathy, which coin you own.

800
01:17:52,566 --> 01:17:55,566
And you own your coin, and you share your coin,

801
01:17:56,566 --> 01:17:59,566
including by pretending that you use it for its features,

802
01:17:59,566 --> 01:18:02,566
but no one is really using any of them for any feature.

803
01:18:03,566 --> 01:18:06,566
But that's kind of hard when you consider that Bitcoin was,

804
01:18:06,566 --> 01:18:09,566
that the Darknet markets were Bitcoin only,

805
01:18:09,566 --> 01:18:13,566
and then they switched to being Monero only.

806
01:18:15,566 --> 01:18:17,566
It's kind of hard to regard that as...

807
01:18:17,566 --> 01:18:19,566
I question that narrative.

808
01:18:20,566 --> 01:18:26,566
Who's doing analysis on Darknet market transactions

809
01:18:26,566 --> 01:18:29,566
to find out what the volume is for these things?

810
01:18:29,566 --> 01:18:31,566
It seems to me that if you were a really good Dark market,

811
01:18:31,566 --> 01:18:36,566
part of your job would be to prevent people from being able to find out your transaction volumes.

812
01:18:37,566 --> 01:18:41,566
Indeed, but I think you also want to attract customers

813
01:18:41,566 --> 01:18:43,566
by saying, like, we're the biggest or something.

814
01:18:43,566 --> 01:18:45,566
There was a good friend of mine.

815
01:18:45,566 --> 01:18:47,566
Well, I don't know about a good friend,

816
01:18:47,566 --> 01:18:49,566
but, I mean, someone I've known for, like, whatever,

817
01:18:49,566 --> 01:18:51,566
like 15 years on the Internet from far away.

818
01:18:51,566 --> 01:18:53,566
And I don't think I've never met them in person.

819
01:18:53,566 --> 01:18:58,566
But this guy Guern, and he's an absolutely fascinating character.

820
01:18:59,566 --> 01:19:02,566
He's one of the most interesting people on the Internet, I think.

821
01:19:02,566 --> 01:19:04,566
It's almost fair to say.

822
01:19:05,566 --> 01:19:08,566
He has this site, and he used to look into all this,

823
01:19:08,566 --> 01:19:09,566
but I don't think he has recently.

824
01:19:09,566 --> 01:19:11,566
But he used to actually be a...

825
01:19:11,566 --> 01:19:14,566
He was a Darknet market researcher, was one of his many titles.

826
01:19:15,566 --> 01:19:17,566
And he's an absolutely fascinating guy.

827
01:19:18,566 --> 01:19:21,566
Just a wide variety of interests.

828
01:19:21,566 --> 01:19:23,566
He's kind of like a polymath kind of guy.

829
01:19:23,566 --> 01:19:24,566
He's just...

830
01:19:24,566 --> 01:19:26,566
When he gets into something, he really gets into it,

831
01:19:26,566 --> 01:19:29,566
and he uses a computer at a very high level.

832
01:19:30,566 --> 01:19:31,566
I wouldn't trust...

833
01:19:31,566 --> 01:19:35,566
I wouldn't trust if a Darknet market had some sort of advertising campaign

834
01:19:35,566 --> 01:19:37,566
to convince people that they were the largest.

835
01:19:38,566 --> 01:19:39,566
I wouldn't trust that they actually are,

836
01:19:39,566 --> 01:19:43,566
because I'd think they're doing a pretty bad job being a Darknet market.

837
01:19:43,566 --> 01:19:45,566
If they're advertising.

838
01:19:45,566 --> 01:19:47,566
It is a paradox, yes.

839
01:19:47,566 --> 01:19:48,566
It's definitely a paradox.

840
01:19:48,566 --> 01:19:49,566
I agree.

841
01:19:49,566 --> 01:19:51,566
It's hard, because you want...

842
01:19:51,566 --> 01:19:54,566
In some sense, I would imagine they want people to know about them,

843
01:19:54,566 --> 01:19:58,566
and then in a different sense, they want no one to find out about them.

844
01:20:00,263 --> 01:20:14,263
Yeah, I remember recently, Post Capone, he mentioned in passing that if half the transactions on Bitcoin were through Lightning, then essentially Bitcoin would be as private as Monero. Does that sound right?

845
01:20:16,263 --> 01:20:18,263
Well, maybe.

846
01:20:18,263 --> 01:20:20,263
It doesn't sound likely, but...

847
01:20:20,263 --> 01:20:33,263
I think one thing... Well, there's a... John Carvalho hosted a Lightning limitations synonym space. He did these synonym spaces. I think this one was like August of last year.

848
01:20:33,263 --> 01:20:43,263
And then you can hear he has elite Lightning people, and there's a section about privacy, and they complain a lot about the privacy in that video.

849
01:20:44,263 --> 01:20:58,263
So I think the privacy is overhyped a little bit in Lightning, where the original thought, like layer one of the onion, so to speak, is like people say, well, it's off-chain, so on-chain, there's this permanent record of every transaction.

850
01:20:58,263 --> 01:21:17,263
But on Lightning, that's not the case, so therefore, better privacy. But then there's all kinds of... I think for a start, IP addresses and things are mandatory to do the routing and just form connections between the Lightning nodes to find the route.

851
01:21:17,263 --> 01:21:38,263
So you should listen to them, not me. They seem to be a little bit pessimistic about near-term Lightning privacy. I think it will be eventually very private, but they think that in the, whatever, two to three year time window, from what I gather, it's pretty pessimistic.

852
01:21:39,263 --> 01:21:56,263
At an intuitive level, the idea of not putting everything on the blockchain sounds like it would be an improvement in privacy. But if your alternative is to tie it to your IP address instead, well, it's like, okay, I guess you're just out of the frying pan and into the fire.

853
01:21:57,263 --> 01:22:18,263
But yeah, I don't think the concept of the Lightning network requires tying payments to your IP address. I know you can use Tor addresses, because I've done it before, to hide my IP address, and I suspect that there's some other things you can do as well.

854
01:22:19,263 --> 01:22:30,263
But we'll see. Maybe we'll never see, because Lightning sucks, and we'll just maybe come up with something better instead of trying to fix it.

855
01:22:31,263 --> 01:22:44,263
Yeah, I feel that. Because I do see a similarity with Mineral now, where back in the day with Bitcoin, it just had a lot of the fundamentals that people look for.

856
01:22:44,263 --> 01:23:01,263
Obviously, people in the dark utilizing it, low supply, proof of work, all these things that are attractive to a lot of people across the internet. But if Bitcoin can nail that, then there's really no argument.

857
01:23:14,263 --> 01:23:22,263
All right.

858
01:23:44,263 --> 01:24:13,263
I'm a big fan of all the attempts to build sidechains. I like Liquid. I like Rootstock. I guess, with the exception of Stacks, I don't like Stacks.

859
01:24:15,263 --> 01:24:25,263
That's the only one. You guys know I like spacechains. I've come up with a couple of sidechain models of my own, and I've implemented some of them and have some worked on other ones.

860
01:24:26,263 --> 01:24:37,263
So I like all of that stuff. Right now, I'm trying to work with some guys on making something called a SPV verification function in Bitcoin script.

861
01:24:38,263 --> 01:24:49,263
So early on in Bitcoin, there was this thought that perhaps we could soft fork in a simplified payment verification function in Bitcoin.

862
01:24:50,263 --> 01:24:59,263
So simplified payment verification is this technique for proving that a payment occurred on Bitcoin without validating the entire blockchain.

863
01:25:00,263 --> 01:25:15,263
You just prove that the particular transaction is included in a branch of a Merkle tree whose root has a certain amount of proof of work on it, and then you can use that as a substitute for actually proving the payment happened.

864
01:25:16,263 --> 01:25:26,263
And there was talk about soft forking in a function that would do that so you could validate whether a payment happened on Bitcoin or on another blockchain and use that as the condition to spend on Bitcoin.

865
01:25:27,263 --> 01:25:39,263
But it never happened, and now me and some other guys are in a Telegram group trying to hack together a way to do it, a way to implement one without a soft fork, just by using the native built-in functions of script.

866
01:25:40,263 --> 01:25:44,263
And I think it's kind of promising. I think there's some promising work being done in that group.

867
01:25:45,263 --> 01:25:52,263
And if we're able to succeed, then I think we could use it to build a two-way peg without a soft fork.

868
01:25:53,263 --> 01:26:03,263
And right now, I think that work is the most promising I see in terms of building a sidechain that has a two-way peg.

869
01:26:04,263 --> 01:26:12,263
Because right now it doesn't seem to me like there's much chance that BIP300 will get accepted by the community.

870
01:26:13,263 --> 01:26:17,263
And so I'm trying to find ways to just work around that and do it without a soft fork.

871
01:26:18,263 --> 01:26:20,263
Would that result be merge-mined sidechains?

872
01:26:21,263 --> 01:26:30,263
It could be. That's what I would want, because we already have ways to do merge-mining, and that's been a success.

873
01:26:31,263 --> 01:26:35,263
So I would like to use that as the governance mechanism, because there's really two problems.

874
01:26:36,263 --> 01:26:42,263
BIP300 and BIP301 solve two problems. One of them is the two-way peg, and the other is governance.

875
01:26:43,263 --> 01:26:48,263
Another way of putting that is, how do you come to consensus on the order of transactions on the sidechain?

876
01:26:48,263 --> 01:26:55,263
BIP301 solves that, but also Reuben Thompson's blind merge-mining proposal can do the same thing without a soft fork.

877
01:26:56,263 --> 01:27:01,263
So that's the one that I use in my Space Chain Launcher. That's the one a couple of other people have used as well.

878
01:27:02,263 --> 01:27:07,263
And then the other one is the two-way peg. That's the more important one, and we don't really have anything for that.

879
01:27:08,263 --> 01:27:15,263
Nothing good, anyway. All we have is the multi-sigs, the multi-sig federated pegs.

880
01:27:16,263 --> 01:27:20,263
So finding a solution to that is one of my current goals.

881
01:27:25,263 --> 01:27:35,263
The original way the sidechain was explained was as SPV proof, and that was the original sidechain design.

882
01:27:36,263 --> 01:27:45,263
The original design involved something like a skip list idea, where it proved that many blocks had happened, like thousands,

883
01:27:46,263 --> 01:27:53,263
by tying each block had a little index, and it referred to a few preceding ones.

884
01:27:54,263 --> 01:27:59,263
This had a log in growth or something, but you still had to put many headers.

885
01:28:00,263 --> 01:28:07,263
You actually had to put many, many actual block headers into the peg-out transaction, which would be like tens of kilobytes.

886
01:28:11,263 --> 01:28:13,263
And it required a soft fork.

887
01:28:14,263 --> 01:28:21,263
Yes, it required quite a bit, and then it could also be surprise attacked, which is a little bit different than PIF300.

888
01:28:22,263 --> 01:28:24,263
But yeah, I think that would be different.

889
01:28:25,263 --> 01:28:36,263
I would wonder about, the goal is to first use current Bitcoin scripts to prove SPV of work on a different chain?

890
01:28:37,263 --> 01:29:00,263
Yes, the goal is to design a transaction system such that transactions on this sidechain can be validated using an SPV verifier that we can construct in Bitcoin script.

891
01:29:01,263 --> 01:29:10,263
So like, custom design a hashing function that we can implement in Bitcoin script, and then use that to build like Merkle trees and stuff on this sidechain.

892
01:29:11,263 --> 01:29:18,263
And then just create a whole sidechain that's based on what can we validate with Bitcoin script.

893
01:29:19,263 --> 01:29:23,263
And if we get that, then we might be able to work. I don't know, the work is ongoing.

894
01:29:23,263 --> 01:29:52,263
That's cool. That's going to be very difficult to get something that will have the second chain, where because you have to unlayer one, people will spend to this weird script, and then it will be unlocked by giving the thing a lot of stuff, an awful lot of stuff on the second chain.

895
01:29:53,263 --> 01:29:54,263
An awful lot of stuff, yeah.

896
01:29:55,263 --> 01:30:02,263
But if you have that as an option, then you can make like an optimistic version, where you can use a federation to peg in and peg out.

897
01:30:03,263 --> 01:30:10,263
But if they censor you, you can fall back on using a very expensive alternative peg out that doesn't require the federation.

898
01:30:11,263 --> 01:30:21,263
So you can have like just an or statement, either this big long SPV verifier, or 11 of 15 of these signatures, or of these public keys.

899
01:30:21,263 --> 01:30:27,263
And that way, you can just always use the cheap method unless you get censored, and then you can use the expensive method.

900
01:30:28,263 --> 01:30:33,263
But we'll see. I mean, it's early work. It's pretty much just a concept right now.

901
01:30:34,263 --> 01:30:41,263
But I did some work on demonstrating that you can build a SHA-256 function in Bitcoin script.

902
01:30:42,263 --> 01:30:45,263
And actually, I got pretty much complete with it.

903
01:30:46,263 --> 01:30:53,263
Instead of just using OP-SHA-256, which you already have, I just built one using the Boolean functions.

904
01:30:54,263 --> 01:30:57,263
I built like a Boolean circuit that does SHA-256.

905
01:30:58,263 --> 01:31:03,263
And so if you can do that, you can probably build something custom.

906
01:31:04,263 --> 01:31:08,263
You can probably build a custom hashing function designed to be much cheaper,

907
01:31:08,263 --> 01:31:15,263
and designed specifically for proving that some transaction happened on a sidechain.

908
01:31:16,263 --> 01:31:21,263
So I mean, it's early days, but I think it's promising.

909
01:31:22,263 --> 01:31:28,263
It might be the most promising way that I'm currently aware of for getting something like a two-way peg into Bitcoin without a soft fork.

910
01:31:28,263 --> 01:31:38,263
Other than just using a multisig, which of course already works. You can just do that.

911
01:31:39,263 --> 01:31:45,263
Are you familiar with the crypto-economic objections some people have to merged mining?

912
01:31:46,263 --> 01:31:53,263
Like Peter Todd and Shinobi, they think it's going to make the incentives too complicated.

913
01:31:54,263 --> 01:31:58,263
And that we should keep Bitcoin simple.

914
01:31:59,263 --> 01:32:09,263
What do you think about that, this ongoing sort of dissent from the idea that Satoshi, with his invention of merged mining, was on the right track?

915
01:32:10,263 --> 01:32:14,263
I haven't given it much thought.

916
01:32:15,263 --> 01:32:17,263
The fact is you can do it.

917
01:32:17,263 --> 01:32:25,263
And if it is a vulnerability of some sort, I don't think there's a way to stop it from happening.

918
01:32:26,263 --> 01:32:32,263
So I would rather try and build the best version of it that I can.

919
01:32:33,263 --> 01:32:36,263
And then if it's a vulnerability and if it can kill Bitcoin, great.

920
01:32:37,263 --> 01:32:41,263
Then we know Bitcoin can't succeed because it has this unstoppable vulnerability called merged mining.

921
01:32:42,263 --> 01:32:47,263
As long as you can add data into Bitcoin's blockchain, you can do merged mining.

922
01:32:48,263 --> 01:32:51,263
And I don't think there's a way to stop people from adding data to Bitcoin.

923
01:32:52,263 --> 01:33:04,263
Are you agreeable to the notion that not only are they wrong, but in fact a vital strength of Bitcoin is what Satoshi suggested, which was collecting fees from every single blockchain.

924
01:33:04,263 --> 01:33:10,263
The vision that every blockchain in the world would be a merged mined blockchain of Bitcoin.

925
01:33:11,263 --> 01:33:13,263
That's what Satoshi explicitly said he expected.

926
01:33:14,263 --> 01:33:16,263
That Bitcoin be the L1 for every other blockchain.

927
01:33:17,263 --> 01:33:21,263
Do you think that'd be great to collect a ton of fees, strengthening the security budget?

928
01:33:22,263 --> 01:33:33,263
I've long thought that using merged mining to collect fees so that miners can increase their fee revenue sounds like a good thing.

929
01:33:34,263 --> 01:33:41,263
I'm aware that Shinobi at least, I didn't know Peter Todd also says this, but I'm aware that Shinobi says that it's actually a vulnerability.

930
01:33:42,263 --> 01:33:47,263
I think I did read his argument once, but I haven't processed it and I can't remember what its contents are.

931
01:33:48,263 --> 01:33:52,263
So I hesitate to say it's false without even knowing what it is.

932
01:33:53,263 --> 01:34:01,263
But if it is true, then I don't think that's a reason to not do it.

933
01:34:01,263 --> 01:34:10,263
If Bitcoin does have a vulnerability, then I'd like to see it exploited so that it can either be fixed or so that we can learn that Bitcoin won't work because it has a serious vulnerability.

934
01:34:11,263 --> 01:34:13,263
That's a great response. Thank you.

935
01:34:14,263 --> 01:34:24,263
The security budget topic is exciting to a lot of people because unlike the other topics related to drivechain, this one is going to be right or wrong.

936
01:34:25,263 --> 01:34:28,263
Either the fees will go up without a lot of merged mining or they won't.

937
01:34:28,263 --> 01:34:36,263
And if they don't ever go up, then the halvings one by one will reduce the transaction finality.

938
01:34:37,263 --> 01:34:42,263
And eventually it would be very cheap in theory to be a hostile miner with a majority of the hash rate.

939
01:34:43,263 --> 01:34:46,263
And people who are optimistic think, well, the fees will go up soon.

940
01:34:47,263 --> 01:34:50,263
But year after year, they come back down to one sat per V byte.

941
01:34:51,263 --> 01:34:55,263
So it's only a matter of time until they're one sat per V byte again, perhaps.

942
01:34:55,263 --> 01:34:56,263
Perhaps.

943
01:34:57,263 --> 01:35:06,263
They also keep going up in value, though, like overall, because if you check year by year, we're sitting at fee all time highs.

944
01:35:07,263 --> 01:35:09,263
So every year we seem to be doing that.

945
01:35:10,263 --> 01:35:23,263
But we'll see because it's not just the absolute value of Satoshis that are relevant to replacing the subsidy, but also the value of those Satoshis also contributes.

946
01:35:23,263 --> 01:35:27,263
And that part's been on the rise year after year.

947
01:35:28,263 --> 01:35:29,263
That's an interesting view.

948
01:35:30,263 --> 01:35:39,263
I, of course, agree that the real purchasing power of the fees per unit of time is what matters and not the nominal number of sats.

949
01:35:40,263 --> 01:35:43,263
Of course, it's the purchasing power of those sats that matters.

950
01:35:44,263 --> 01:35:54,263
But are you adjusting for the loss of the value of the dollar when you think about whether the total fees per day are growing?

951
01:35:55,263 --> 01:36:09,263
Because if we're at half a million dollars a day of fee revenue in recent weeks before this spike, right now I think we're about at a million dollars a day.

952
01:36:10,263 --> 01:36:11,263
But I've looked at the chart a lot.

953
01:36:11,263 --> 01:36:19,263
Over the last five years, the fees again and again were mainly at half a million dollars a day of revenue.

954
01:36:20,263 --> 01:36:23,263
And there are spikes from time to time.

955
01:36:24,263 --> 01:36:28,263
But half a million dollars a day five years ago was worth more than it is today.

956
01:36:29,263 --> 01:36:43,263
So, in fact, I would argue that we're not on an encouraging path in terms of the value of the block space, which is the fees total paid per unit of time in terms of their purchasing power, their real value.

957
01:36:44,263 --> 01:36:45,263
I have not looked at those charts.

958
01:36:46,263 --> 01:36:47,263
That's pretty cool to hear.

959
01:36:48,263 --> 01:36:52,263
If you could put out a tweetstorm about that and show the charts, that'd be really interesting.

960
01:36:53,263 --> 01:36:55,263
I would like to look at that and see your analysis.

961
01:36:56,263 --> 01:37:01,263
It sounds like you're saying in 2017 fees were half a million dollars a day.

962
01:37:02,263 --> 01:37:09,263
Today, over the course of this year so far, fees have been about half a million dollars a day.

963
01:37:10,263 --> 01:37:13,263
But, of course, the dollar was worth more in 2017.

964
01:37:14,263 --> 01:37:16,263
Is that a good summary of what you're saying?

965
01:37:17,263 --> 01:37:18,263
Yes.

966
01:37:18,263 --> 01:37:23,263
So I usually go to blockchain.com and then click on Explorer.

967
01:37:24,263 --> 01:37:28,263
And after you click on Explorer on blockchain.com, click on Charts.

968
01:37:29,263 --> 01:37:32,263
And then click on Mining Information.

969
01:37:33,263 --> 01:37:34,263
That's Mining Information.

970
01:37:35,263 --> 01:37:39,263
And then click on Total Transaction Fees Parenthesis USD.

971
01:37:40,263 --> 01:37:43,263
That's Total Transaction Fees Parenthesis USD.

972
01:37:44,263 --> 01:37:50,263
And then where it says Market Price on the chart, click on the word Market.

973
01:37:51,263 --> 01:37:54,263
And that will eliminate the price of Bitcoin.

974
01:37:55,263 --> 01:37:59,263
And now we're looking at a chart of only the transaction fees in U.S. dollars.

975
01:38:00,263 --> 01:38:04,263
Which, as I mentioned earlier, isn't a perfect measure of the real value.

976
01:38:05,263 --> 01:38:08,263
Because, of course, the dollar is always losing value over the long term.

977
01:38:09,263 --> 01:38:19,263
So if it were possible to adjust this for inflation, then it would look slightly worse in terms of the growth of the value of Bitcoin's block space.

978
01:38:21,263 --> 01:38:23,263
So we can look at a chart of three years.

979
01:38:24,263 --> 01:38:26,263
Hang on a second. I'm trying to follow your example here.

980
01:38:27,263 --> 01:38:29,263
I went to blockchain.com, I clicked Explorer, then I clicked Charts.

981
01:38:30,263 --> 01:38:31,263
And what do I do?

982
01:38:31,263 --> 01:38:32,263
Mining Information.

983
01:38:33,263 --> 01:38:34,263
And after you click on it.

984
01:38:35,263 --> 01:38:36,263
I don't see that.

985
01:38:37,263 --> 01:38:38,263
Oh, there it is. Mining Information.

986
01:38:39,263 --> 01:38:42,263
And then Total Transaction Fees or Miner's Revenue.

987
01:38:43,263 --> 01:38:44,263
Total Transaction Fees USD.

988
01:38:45,263 --> 01:38:48,263
Because Miner Revenue, of course, takes into effect the subsidy.

989
01:38:48,263 --> 01:38:52,263
Whereas we want to look at only the value of the block space.

990
01:38:53,263 --> 01:38:58,263
Okay, so I'm on the Total Transaction Fees USD and then you said to get rid of something?

991
01:38:59,263 --> 01:39:01,263
If you click on the word Market Price, just click on the word Market.

992
01:39:02,263 --> 01:39:04,263
Which is at the top right of the chart graphic.

993
01:39:05,263 --> 01:39:08,263
That removes the distraction of the market price of Bitcoin.

994
01:39:09,263 --> 01:39:15,263
Now we're looking at a chart of only the value of the block space, which is synonymous with the phrase Total Transaction Fees.

995
01:39:15,263 --> 01:39:20,263
So we're talking, we're thinking here about the value of the block space per unit of time.

996
01:39:21,263 --> 01:39:28,263
So this chart shows the total fees paid in each calendar day to Bitcoin miners from just transaction fees.

997
01:39:29,263 --> 01:39:39,263
Now, of course, I would concede that during the recent Ordinals event, you know, with people doing all kinds of entertaining things like posting unusual transactions.

998
01:39:40,263 --> 01:39:49,263
There was some payments to miners that so-called out-of-band payments or just off-chain payments like a check written to a miner in a bank account.

999
01:39:50,263 --> 01:39:52,263
And that would be part of the security budget in theory.

1000
01:39:53,263 --> 01:39:58,263
So I would concede that some people got money that wasn't shown in this chart.

1001
01:39:59,197 --> 01:40:29,197
Almost all miner income is on-chain, right? Like, so that's, but I would concede there's other miner things to think about with in terms of miner income. But here we're looking at Total Transaction Fees in dollars, not inflation adjusted. And you can see here, click on three years. Look at the three years today at the very right hand side of the chart. May 23rd is the latest data available. 1.7 million dollars.

1002
01:40:29,197 --> 01:40:36,836
It's almost the exact same thing as August of 2020, when we were a little bit higher than 1.7.

1003
01:40:37,397 --> 01:40:46,357
So anyone who says right now, as of most recent data available, that the fees are very high, you know, is actually mistaken.

1004
01:40:46,397 --> 01:40:49,237
The fees are where they were, you know, two or three years ago.

1005
01:40:50,077 --> 01:40:57,636
And pretty soon we'll be back down to that, like, you know, June 2022 level of like $400,000 per day, I think.

1006
01:40:59,237 --> 01:41:02,917
The usual Bitcoin, which is like half a million dollars a day to pay to miners.

1007
01:41:03,317 --> 01:41:08,116
This is not good. You know, Bitcoin has 200 million people supposedly using it.

1008
01:41:08,156 --> 01:41:17,357
I heard that number from Brad Mills and he was one of my friends from, never met him, but, you know, talked to him hundreds of times on Clubhouse.

1009
01:41:17,677 --> 01:41:19,317
So he said 200 million people use Bitcoin.

1010
01:41:19,756 --> 01:41:23,957
Well, I'm thinking if we're 13 years in with 200 million people, why is the block space so cheap?

1011
01:41:23,997 --> 01:41:24,796
Something is wrong.

1012
01:41:25,997 --> 01:41:27,557
Well, now, hang on. I'm looking at this chart.

1013
01:41:27,557 --> 01:41:35,476
It looks like over the it looks like the average over the last year is about two million or two million dollars a day in transaction fees.

1014
01:41:36,036 --> 01:41:42,396
And when I look in 2017, it looks like the average is close to close to half a million per day.

1015
01:41:42,517 --> 01:41:44,076
So that seems like a big increase.

1016
01:41:46,116 --> 01:41:48,396
Look at the all time chart and what do you see?

1017
01:41:48,957 --> 01:41:56,836
What we see is almost always Bitcoin is getting under half a million dollars a day of fees.

1018
01:41:56,917 --> 01:42:02,637
There's the spike in 2018, the spike in 2021 and then the smaller spike in 2023.

1019
01:42:04,277 --> 01:42:08,917
But if you look at like January 2017, we were at a hundred thousand dollars per day.

1020
01:42:09,077 --> 01:42:13,157
And then if you look at the end of 2017, you know, it was it was enormous.

1021
01:42:13,197 --> 01:42:14,876
It was like 11 million dollars a day.

1022
01:42:14,917 --> 01:42:16,917
Just a few days, a few days.

1023
01:42:18,197 --> 01:42:25,077
Yeah, for a few days. So on average, though, it was close to it looks like I mean, I would have to do some analysis to figure out the average.

1024
01:42:25,077 --> 01:42:30,396
But it looks to me naively just looking at it like the average was around a half a million per day.

1025
01:42:31,316 --> 01:42:39,476
And then if you look at 2023, you go to the beginning of the thing at the beginning of 2023, which is January.

1026
01:42:41,116 --> 01:42:47,596
We were at two hundred fifty thousand dollars a day at the beginning of January.

1027
01:42:49,637 --> 01:42:51,357
Three hundred. Yeah. Two hundred fifty thousand.

1028
01:42:52,357 --> 01:43:03,596
And then all along, it looks like it's it increases to quite a bit more than a half, somewhere around seven hundred seventy thousand, it stays up there for a long time per day.

1029
01:43:03,637 --> 01:43:08,997
I don't know. It looks like we're we are significantly increasing compared to where we were in 2017.

1030
01:43:10,756 --> 01:43:12,717
Yeah, I mean, but it needs analysis, though.

1031
01:43:12,717 --> 01:43:15,437
I mean, it's hard to judge with all these spikes everywhere on the graph.

1032
01:43:15,557 --> 01:43:18,036
OK, I would like to see some actual analysis of that.

1033
01:43:18,637 --> 01:43:28,157
Let's look at click on where it says under the words total transaction fees, there's the 30 day average you can select instead of one day average.

1034
01:43:28,316 --> 01:43:29,676
So you can smooth the chart.

1035
01:43:30,357 --> 01:43:37,077
You can also as the Bitcoin security budget optimists love to do change the chart to log instead of linear.

1036
01:43:38,197 --> 01:43:45,036
And for analysis, there are some good places I would point you to people much smarter than me.

1037
01:43:45,596 --> 01:43:48,596
For example, there's Lynn Alden's.

1038
01:43:50,596 --> 01:43:57,517
Article from March 2021 called Bitcoin Fee Modeling, and it's a very long essay, I think it's outstanding.

1039
01:43:58,676 --> 01:44:03,197
And I recommend it highly, there's a good passage in there.

1040
01:44:05,596 --> 01:44:08,956
Well, I won't read that now, but that's a good one.

1041
01:44:08,956 --> 01:44:12,077
There's also debates that Paul has had that you can easily find on.

1042
01:44:14,476 --> 01:44:26,077
On like podcast apps, he had a debate with Dan Held about this topic, they got into the details of log scale versus linear scale and Paul's articles.

1043
01:44:26,117 --> 01:44:34,276
Paul has two articles on this topic of the security budget, one from 2019 called Security Budget in the Long Run, which is on TruthCoin.info.

1044
01:44:35,197 --> 01:44:40,357
And then another article, a follow up in 2021 about merged mining.

1045
01:44:41,517 --> 01:44:47,917
So those are the two posts, very detailed sort of PhD level discussion of the security budget and the fees.

1046
01:44:48,876 --> 01:44:53,476
And also, Paul has like a professional background in statistics.

1047
01:44:54,036 --> 01:44:57,237
And I find his articles very compelling.

1048
01:44:57,596 --> 01:45:03,716
We have to think about, you know, in the future, will there be these huge spikes in fees that flood the miners with revenue?

1049
01:45:04,156 --> 01:45:18,316
Or will there be fewer and fewer of those over time as, you know, scaling through custodial venues and other scaling solutions that lower the fees and enable the high frequency traders to move off of Bitcoin?

1050
01:45:18,756 --> 01:45:23,837
Those depart from Bitcoin's main chain and people get lower fees elsewhere.

1051
01:45:23,917 --> 01:45:28,156
So I think we can't rely on these spikes coming from time to time.

1052
01:45:28,156 --> 01:45:33,397
And capitalism has the effect of pushing down the price of everything, almost everything.

1053
01:45:33,917 --> 01:45:37,756
There are only a few kinds of goods where this doesn't operate.

1054
01:45:38,556 --> 01:45:39,917
And money is one of them.

1055
01:45:40,756 --> 01:45:43,197
Capitalism doesn't push down the price of money.

1056
01:45:44,197 --> 01:45:58,316
However, capitalism does push down the price of block space because innovation and scaling solutions and consumer choice tend to reduce the price of the block space as people find ways to avoid paying high fees.

1057
01:45:59,156 --> 01:46:12,117
So there's this good analysis in Paul's articles that I find compelling, which is that what we should aspire to do is make sure we collect fees from every single blockchain in the world and bring those fees to Bitcoin through merged mining.

1058
01:46:12,276 --> 01:46:23,397
And if we don't do that, then we'll see the Bitcoin main chain block space return to one sat per V by it again and again, even as Bitcoin has hundreds of millions of people using it.

1059
01:46:24,316 --> 01:46:29,237
And this will perplex and confound people who haven't thought about it enough, I think.

1060
01:46:32,677 --> 01:46:33,596
That's a really cool chart.

1061
01:46:33,596 --> 01:46:39,716
I want to share this chart and then try and convince somebody to do some analysis on it.

1062
01:46:40,156 --> 01:46:50,476
One thing I'm noticing is that the year 2020 seems like it was the year with the most with the most consistently higher than baseline fee revenue, which is interesting.

1063
01:46:54,476 --> 01:47:02,996
What was special about the I don't remember any any particular thing during 2020 being like, oh, I guess that was probably a block was doing stuff during that year and they were bumping up.

1064
01:47:03,036 --> 01:47:04,436
They were increasing fees for everyone.

1065
01:47:04,436 --> 01:47:11,957
So if you look at if you look at the market price, I want you to click on the words market price to bring back the price of Bitcoin.

1066
01:47:12,596 --> 01:47:19,677
And this will bring us to one of the things that Paul talks about in his statistical analysis in that article on proof point that info called security budget in the long run.

1067
01:47:20,156 --> 01:47:27,237
He argues that Bitcoin has had run ups where the price rose dramatically for a period of time, such as weeks or months.

1068
01:47:27,837 --> 01:47:44,917
And when the price of Bitcoin is rising very fast, economic actors, that is, investors, speculators, transactors, they don't care as much about how much how much they're paying in fees because in their mind they're going to make more from the gains of rapid execution.

1069
01:47:45,316 --> 01:47:51,197
So they'll pay for a high fee to get in, get their transaction in because they want to buy Bitcoin immediately.

1070
01:47:52,197 --> 01:47:58,117
They have high time preference because they want to own Bitcoin soon because they think it's appreciating rapidly.

1071
01:47:58,476 --> 01:48:20,917
However, we can know with certainty that if Bitcoin continues to be adopted and grow, there necessarily cannot always be rapid run ups in its price in terms of real purchasing power, because every time Bitcoin has a run up in price, it gets closer and closer to its total addressable market.

1072
01:48:21,276 --> 01:48:28,397
At some point, the real return from holding Bitcoin will will be lower.

1073
01:48:32,837 --> 01:48:44,477
The real return from holding Bitcoin will be lower because it can't be a 10x year, for example, in Bitcoin again and again and again, eventually Bitcoin will be the world's money and then it can't have a 10x.

1074
01:48:45,157 --> 01:48:51,756
There's a limit to how many times Bitcoin could multiply in the future and in terms of its real value.

1075
01:48:52,037 --> 01:48:56,197
So in other words, we can't rely for the sake of the security budget.

1076
01:48:56,197 --> 01:49:08,597
We can't rely on there being these massive spikes in fees every time Bitcoin has a run up in its value because eventually Bitcoin will stop having those run ups and Bitcoin will be the world's money.

1077
01:49:08,796 --> 01:49:15,796
And then if the security is low, there won't be the occasional fee spike to fix that.

1078
01:49:18,436 --> 01:49:27,837
Do you follow what I'm saying that we can't do, but I don't think at least this 2020 part of the chart is fascinating to me because there was there wasn't a huge.

1079
01:49:27,837 --> 01:49:33,717
Well, for most of 2020, there wasn't a huge run up in price.

1080
01:49:33,717 --> 01:49:34,837
There was at the end of that year.

1081
01:49:36,116 --> 01:49:37,436
But for most of that year, there was not.

1082
01:49:37,436 --> 01:49:45,037
And yet there and yet the fees were consistently were very they were typically higher than baseline.

1083
01:49:45,277 --> 01:49:48,637
Like they were they were pretty they're doing pretty well in that year.

1084
01:49:49,236 --> 01:49:50,436
So I wonder what was happening there.

1085
01:49:58,837 --> 01:49:59,837
Well.

1086
01:50:04,837 --> 01:50:15,837
I think the big the big the big price run up didn't even happen until January, so there wasn't really a big price or price got to $20,000 by the by the end of 2020.

1087
01:50:17,837 --> 01:50:23,837
And it started 2020 at about 10,000.

1088
01:50:24,837 --> 01:50:25,837
Right. That's interesting.

1089
01:50:25,837 --> 01:50:33,837
So what I would say to sort of assist those who might be listening and have the opposite view of mine is to speak for them.

1090
01:50:33,837 --> 01:50:40,837
I would attempt to say that what would and Paul contemplates this in his security budget article.

1091
01:50:40,837 --> 01:51:00,837
And on Truthcoin.info, the one from 2019, that article, he he says that what would what security budget skeptics are looking to see is the increase in the value of the block space at a time when the Bitcoin price is not moving up.

1092
01:51:00,837 --> 01:51:04,837
And what we'd like to see is this occur for a multi-month period.

1093
01:51:05,837 --> 01:51:12,837
In other words, although we usually refer to total transaction fees in Paul's article, he mentions just as kind of a convenient reference.

1094
01:51:12,837 --> 01:51:29,837
If we saw the price of Bitcoin over $2 per transaction over $2 as the price to transact on Bitcoin's main chain, if we saw it over $2 for a multi-month period, while at the same time, Bitcoin's price was not moving up but was moving sideways.

1095
01:51:30,837 --> 01:51:36,837
And if we saw the value of the block space moving from $2 per transaction north, that would be very interesting.

1096
01:51:37,837 --> 01:51:46,837
If you follow what I'm saying, like we want to see a multi-month period, like three or six months where transaction fees are rising while Bitcoin is level or falling.

1097
01:51:47,837 --> 01:51:59,837
And if that were to occur for a multi-month period with transaction fees over $2 per transaction, then that would be statistically significant evidence that perhaps there isn't a security budget problem.

1098
01:52:00,837 --> 01:52:15,837
But instead, Bitcoin's market is sustaining a high transaction fee demand, despite there not being a bull run that's necessarily and inherently short-lived, as I mentioned earlier, for the reasons I mentioned.

1099
01:52:15,837 --> 01:52:19,837
We can't have an endless bull run in the price.

1100
01:52:20,837 --> 01:52:34,837
So one of the essences of the insight, I think, in Paul's article is that there have been fee spikes, spikes where the block space was much more valuable, people were paying a lot of fees, and this flooded the miners with money.

1101
01:52:34,837 --> 01:52:44,837
And a lot of people went into Bitcoin mining thinking that there would be another spike and another spike and maybe a spike that's sustained with many millions of dollars per day in fees.

1102
01:52:45,837 --> 01:52:48,837
But instead, what we've seen is the spikes are short-lived.

1103
01:52:48,837 --> 01:52:54,837
They tend to mostly coincide with bull runs that cannot be expected to last forever.

1104
01:52:54,837 --> 01:53:06,837
Because if Bitcoin has a bull run that's huge and it would become the world's money and then the bull run would stop because it can't become the only asset in the whole world and then still appreciate it.

1105
01:53:06,837 --> 01:53:10,837
It can't go on forever that way in terms of a real return.

1106
01:53:10,837 --> 01:53:13,837
At some point, it reaches this total addressable market.

1107
01:53:13,837 --> 01:53:16,837
So for all these complex reasons, we have to be worried.

1108
01:53:16,837 --> 01:53:31,837
We have to be thoughtfully concerned about will the security budget, will the transaction fee revenue in the long run be high to make it very cost prohibitive to be a 51 percent hostile miner.

1109
01:53:31,837 --> 01:53:41,837
And the strategy to ensure there's no problem there is to try to have every blockchain be a merged mined sidechain of Bitcoin.

1110
01:53:41,837 --> 01:53:44,837
And that way, we're collecting fees from every blockchain.

1111
01:53:44,837 --> 01:53:48,837
Because right now, Bitcoin is getting only a fraction of all the fees paid across all blockchains.

1112
01:53:48,837 --> 01:53:52,837
It's about one-tenth to one-twentieth generally.

1113
01:53:53,837 --> 01:53:56,837
So one funny thing is that it may.

1114
01:53:56,837 --> 01:54:04,837
I don't know, but I don't know how many months it's been or since the Ordinal's phenomenon is certainly a multi-month phenomenon.

1115
01:54:04,837 --> 01:54:15,837
But it would actually be very funny if the criterion was met of the criterion of increasing fees, but not a temporary price bubble.

1116
01:54:16,837 --> 01:54:25,837
That would be funny if that was met in just like a third way, which is like doing something that was like Ethereum-like or sidechain-like.

1117
01:54:25,837 --> 01:54:36,837
Like something that just does not involve the, I don't know, like the Jimmy Song safety and like only using Bitcoin as money type of a thing.

1118
01:54:36,837 --> 01:54:43,837
So maybe I should have added that last requirement in or something.

1119
01:54:43,837 --> 01:54:51,837
Because that would be ironic if the fees would only go up if you would do like BRC-20 tokens or something.

1120
01:54:51,837 --> 01:54:53,837
I think that would be kind of funny.

1121
01:54:54,837 --> 01:54:58,837
Well, I find that – thank you for this phone call.

1122
01:54:58,837 --> 01:54:59,837
I say phone call.

1123
01:54:59,837 --> 01:55:05,837
Thank you for this Twitter space because I didn't know about this fee chart, and it's very fascinating and deserves a lot of analysis.

1124
01:55:05,837 --> 01:55:08,837
Or maybe not a lot, but at least a little analysis.

1125
01:55:08,837 --> 01:55:11,837
It's very interesting and informative.

1126
01:55:11,837 --> 01:55:13,837
So thank you.

1127
01:55:13,837 --> 01:55:15,837
Thank you for being here.

1128
01:55:15,837 --> 01:55:21,837
I posted in the Nest the article from truthcoin.info on the security budget.

1129
01:55:21,837 --> 01:55:23,837
So it's there for anyone curious.

1130
01:55:23,837 --> 01:55:25,837
It's very difficult.

1131
01:55:25,837 --> 01:55:26,837
It's very high level.

1132
01:55:26,837 --> 01:55:29,837
This is like a master's or PhD-level article, I think.

1133
01:55:29,837 --> 01:55:31,837
It's long, and there's –

1134
01:55:31,837 --> 01:55:33,837
Well, it's by Paul, so there you go.

1135
01:55:33,837 --> 01:55:35,837
There's like statistical analysis in there.

1136
01:55:35,837 --> 01:55:37,837
There's some math.

1137
01:55:37,837 --> 01:55:47,837
But the essence is very interesting for those who are ambitious to read it about the inevitable end of bull runs.

1138
01:55:47,837 --> 01:55:49,837
We can't have bull runs forever in Bitcoin's value.

1139
01:55:49,837 --> 01:55:55,837
There can't always be a hysterical 10x year where everyone's feverishly buying Bitcoin and doesn't care about the price of the transaction.

1140
01:55:55,837 --> 01:55:57,837
That can't go on forever.

1141
01:55:57,837 --> 01:56:03,837
There can only be so many of those until we've saturated the world with Bitcoin, and then the bull run will end.

1142
01:56:03,837 --> 01:56:07,837
So we can't rely on these bull run fee spikes.

1143
01:56:07,837 --> 01:56:16,837
And there's never been a multi-month period where the price was over $2 a transaction and rising while Bitcoin's price was level.

1144
01:56:16,837 --> 01:56:25,837
So there's been no evidence that we're going to see high fees on a sustained basis, including this ordinals episode recently.

1145
01:56:25,837 --> 01:56:29,837
People were saying, oh, wow, we're seeing $10 million a day in fees.

1146
01:56:29,837 --> 01:56:31,837
And then that ended rather quickly.

1147
01:56:31,837 --> 01:56:35,837
And now it costs under $2, again, as usual, to send a Bitcoin transaction.

1148
01:56:35,837 --> 01:56:37,837
Right now it's under $2.

1149
01:56:37,837 --> 01:56:41,837
Last time I checked yesterday on mempool.space.

1150
01:56:42,837 --> 01:56:46,837
So the evidence is on Paul's side so far.

1151
01:56:46,837 --> 01:56:51,837
But the good news is that there's a powerful solution to this, which is drivechain.

1152
01:56:51,837 --> 01:56:55,837
The aspiration to collect fees from every blockchain in the world.

1153
01:56:55,837 --> 01:57:07,837
If Bitcoin were collecting fees from every blockchain, if every blockchain were a merged mined sidechain of Bitcoin, Bitcoin miners would receive 15 times more fees.

1154
01:57:08,837 --> 01:57:11,837
It would be great.

1155
01:57:11,837 --> 01:57:15,837
There'd be a robust fee revenue coming to the miners.

1156
01:57:15,837 --> 01:57:26,837
Every Bitcoin miner should look into this idea to understand how it benefits the industry a lot and ultimately is probably necessary for Bitcoin survival.

1157
01:57:37,837 --> 01:57:46,837
Well, that was great to have SuperTesna here.

1158
01:57:46,837 --> 01:57:54,837
It's rare that people are interested in both the economics of Bitcoin and the software.

1159
01:57:54,837 --> 01:58:00,837
But he's one of those people who really has a broad view on the whole subject, which is so great.

1160
01:58:00,837 --> 01:58:08,837
Appreciating the fee market while also being like a sidechain coder.

1161
01:58:08,837 --> 01:58:13,837
That's why he's in favor of drivechain.

1162
01:58:13,837 --> 01:58:17,837
SuperTesna has tweeted unequivocally that he supports drivechain.

1163
01:58:17,837 --> 01:58:22,837
Most recently he wrote, I support drivechain, BIP300 and 301.

1164
01:58:22,837 --> 01:58:24,837
And he's written about it many times.

1165
01:58:24,837 --> 01:58:28,837
He wrote a whole essay in favor of drivechain on Stacker News.

1166
01:58:28,837 --> 01:58:32,837
If you look through LayerTwo Labs' tweets, you'll find it.

1167
01:58:32,837 --> 01:58:35,837
We tweeted a link to it and he's tweeted links to it.

1168
01:58:35,837 --> 01:58:40,837
He wrote a great essay called Responding to Objections to Drivechain.

1169
01:58:40,837 --> 01:58:44,837
I think that was the title or Answering Objections to Drivechain.

1170
01:58:45,837 --> 01:58:52,837
He lists three or five common objections to drivechain and then his view of why they're wrong.

1171
01:58:52,837 --> 01:58:58,837
But before he even says why they're wrong, he tries to articulate exactly what the objection is.

1172
01:58:58,837 --> 01:59:01,837
Which is great in terms of sincere engagement.

1173
01:59:01,837 --> 01:59:08,837
He tries to explain what the people think and he tries to give it full charitable treatment.

1174
01:59:08,837 --> 01:59:12,837
And then he answers why he thinks there's a mistake in their objections.

1175
01:59:12,837 --> 01:59:16,837
So he's really like a genuine intellectual in that way.

1176
01:59:19,837 --> 01:59:23,837
It's so great to have him like part of the drivechain community.

1177
01:59:26,837 --> 01:59:28,837
This has been Drivechain Twitter Spaces.

1178
01:59:28,837 --> 01:59:35,837
We meet twice a week on Mondays and Thursdays to talk about Bitcoin Improvement Proposal 300 and 301.

1179
01:59:37,837 --> 01:59:39,837
It's an idea which has the support of Adam Back.

1180
01:59:39,837 --> 01:59:41,837
He tweeted about it today.

1181
01:59:43,837 --> 01:59:48,837
And his words were in our nest.

1182
01:59:48,837 --> 01:59:51,837
The very second tweet we put in the nest where he wrote,

1183
01:59:51,837 --> 01:59:57,837
I think we're going to need big peer-to-peer sidechain for the next billion users to benefit.

1184
01:59:58,060 --> 02:00:07,060
From unseasable peer-to-peer sidechains like drivechain, LayerTwo Labs, peer-to-peer liquid and Rootstock.

1185
02:00:08,180 --> 02:00:15,980
So you can see that in the nest. If you scroll through all the tweets that we've posted in the nest, it's the second to the first tweet.

1186
02:00:17,420 --> 02:00:24,500
Thanks, Dr. Back, for tweeting that. It's really great to have the support of such well-regarded and seasoned Bitcoiners.

1187
02:00:25,420 --> 02:00:29,859
Adam Back is the only person whose name appears in the Bitcoin whitepaper, in the body of the whitepaper.

1188
02:00:31,300 --> 02:00:39,740
There's Satoshi Nakamoto's name, then there's Adam Back's name in one of the paragraphs, and then there's about seven or nine people mentioned in the footnotes.

1189
02:00:40,659 --> 02:00:45,859
Everyone should read the whitepaper and also the footnotes in the whitepaper, or rather endnotes, rather.

1190
02:00:46,819 --> 02:00:52,420
They're really fascinating. Each of the articles in the endnotes, such as way, dyes, be money.

1191
02:00:52,940 --> 02:01:00,019
And there's also articles about privacy, about identity and different important components of blockchain.

1192
02:01:00,859 --> 02:01:10,339
So it's a great way to understand all of the ideas that came before Satoshi published the whitepaper and the ideas that he chose to cite to give credit

1193
02:01:10,979 --> 02:01:16,979
and to make sure everyone knew where the ideas came from that he brought together to make Bitcoin.

1194
02:01:22,339 --> 02:01:24,979
Would anyone like to come up and share a thought?

1195
02:01:26,299 --> 02:01:31,500
Before we close today, we've been going for about two hours. We usually go for just an hour and a half.

1196
02:01:32,780 --> 02:01:38,500
All of the recorded Drivechain Twitter spaces are available on our Twitter, LayerTwo Labs.

1197
02:01:39,019 --> 02:01:46,339
You can also learn a lot more in different ways, like you can check out our Telegram group that has 700 members called Drivechain Talk.

1198
02:01:49,220 --> 02:01:55,780
And you can find links to everything that we have if you go to layer2labs.com or drivechain.info.

1199
02:01:57,180 --> 02:01:58,979
There's tons of essays and articles.

1200
02:02:00,520 --> 02:02:06,100
can see a list of all of the favorable Drivechain related comments

1201
02:02:06,100 --> 02:02:08,580
that famous Bitcoiners have made.

1202
02:02:09,220 --> 02:02:15,203
If you go to the spreadsheet I made called drivechain.info

1203
02:02:16,183 --> 02:02:17,523
forward slash friends.

1204
02:02:18,003 --> 02:02:21,203
That's drivechain.info forward slash friends.

1205
02:02:21,723 --> 02:02:25,743
And you can see there what Fiatjaf, the creator of Noster has to say about

1206
02:02:25,743 --> 02:02:30,266
Drivechain. He's emphatically in favor of it, along with Adam Back and Mike

1207
02:02:38,500 --> 02:02:44,380
And there's like 50 other like notable Bitcoiners, there's there's too many to list

1208
02:02:44,380 --> 02:02:52,940
I'm sure I've missed some and I'm sorry if you're listening and I haven't put your you know, drivechain support into that list, but

1209
02:02:54,459 --> 02:02:56,459
There's only so much time in the day

1210
02:02:57,420 --> 02:03:00,520
Everyone's free to make their own website about drivechain people have made

1211
02:03:01,140 --> 02:03:06,899
Websites about drivechain who I don't even know who they are or where why they did it, but it was great like one of them

1212
02:03:07,380 --> 02:03:09,140
Is

1213
02:03:09,140 --> 02:03:14,940
drivechain.xyz that's a fan website made by a drivechain supporter and

1214
02:03:16,220 --> 02:03:18,220
There's others

1215
02:03:20,580 --> 02:03:23,860
We have a request to speak from Shumba

1216
02:03:25,940 --> 02:03:27,940
Welcome Shumba

1217
02:03:29,380 --> 02:03:31,380
How's it going

1218
02:03:33,099 --> 02:03:34,860
Take it away

1219
02:03:34,860 --> 02:03:36,860
Good afternoon

1220
02:03:37,899 --> 02:03:40,619
Yeah, I just wanted to ask because

1221
02:03:41,819 --> 02:03:46,220
you know, I think it would sound like conspiracy theories or

1222
02:03:46,819 --> 02:03:47,979
but

1223
02:03:47,979 --> 02:03:50,699
Don't do we have a question now?

1224
02:03:51,699 --> 02:03:56,420
whether Satoshi Nakamoto could be the NSA because

1225
02:03:57,539 --> 02:04:02,459
Lately even with my belief in Bitcoin. I've become a bit skeptical

1226
02:04:03,300 --> 02:04:08,339
To say probably Bitcoin was an experiment for us to

1227
02:04:09,580 --> 02:04:15,660
For to drive us towards the adoption of CBDCs. What's your take on that and

1228
02:04:17,419 --> 02:04:24,820
Don't you think these ones we have mastered using Bitcoin it was an experiment for us to move on to

1229
02:04:25,820 --> 02:04:27,820
start to be able to use

1230
02:04:28,540 --> 02:04:30,899
To use the CBDCs

1231
02:04:30,899 --> 02:04:39,339
I don't know. I would want someone's take on it because I've been digging deep. I may believe in Bitcoin, but

1232
02:04:40,380 --> 02:04:45,339
For some reason I come to an understanding that this might be

1233
02:04:46,660 --> 02:04:51,820
Actually, maybe the US government behind it. What's your take on that? Thank you

1234
02:04:52,459 --> 02:04:54,459
I

1235
02:04:54,940 --> 02:05:00,859
Shumba thanks for your question. I appreciate you asking it. It's an interesting question. Many people have asked

1236
02:05:00,859 --> 02:05:08,339
I don't think it matters whether or not the US government or any particular person had any role in the creation of Bitcoin because

1237
02:05:08,980 --> 02:05:15,540
Bitcoin is peer-to-peer and that means no one is privileged by the software. The software is

1238
02:05:16,540 --> 02:05:20,899
Totally unrelated to the particular people who were involved in it

1239
02:05:20,899 --> 02:05:27,220
so if John made Bitcoin or Michael made Bitcoin or Shumba made Bitcoin or

1240
02:05:28,660 --> 02:05:32,899
Janet Yellen made Bitcoin doesn't matter because Bitcoin is peer-to-peer

1241
02:05:33,060 --> 02:05:38,260
So everyone in every part of the system is replaceable with others

1242
02:05:39,179 --> 02:05:44,480
Who are interested in getting involved? It doesn't rely on any particular privileged party

1243
02:05:45,000 --> 02:05:47,000
to perform any role

1244
02:05:47,440 --> 02:05:49,440
So because it's peer-to-peer

1245
02:05:49,440 --> 02:05:51,359
public and permissionless

1246
02:05:51,359 --> 02:05:55,200
It doesn't matter if the government had any role in its creation

1247
02:05:55,600 --> 02:05:59,880
Governments have had the have had a role in lots of technological innovations

1248
02:06:00,799 --> 02:06:02,799
especially related to the military

1249
02:06:03,040 --> 02:06:04,280
weapons

1250
02:06:04,280 --> 02:06:06,280
surveillance and space

1251
02:06:06,560 --> 02:06:10,239
There's all kinds of great people working in the government making technology

1252
02:06:10,239 --> 02:06:15,880
and there's also some people in government who use their positions to enrich themselves and

1253
02:06:16,600 --> 02:06:17,679
unfortunately

1254
02:06:17,679 --> 02:06:19,679
collude with industry

1255
02:06:20,239 --> 02:06:23,399
So just like people governments are imperfect

1256
02:06:23,639 --> 02:06:30,160
It doesn't matter whether the NSA or the CIA or anyone was involved with Bitcoin. I don't think any of them were I

1257
02:06:30,720 --> 02:06:33,280
Think probably Satoshi was just a private person

1258
02:06:33,839 --> 02:06:38,079
Not you know a civilian not an agent of the government, but it wouldn't matter

1259
02:06:39,079 --> 02:06:43,160
That's a great question, I think it's cool that your profile mentions Austrian economics

1260
02:06:43,799 --> 02:06:47,639
That's what brought me to Bitcoin a strong interest in von Mises

1261
02:06:48,359 --> 02:06:49,519
Hayek

1262
02:06:49,519 --> 02:06:56,799
von Balverk and the thinkers at George Mason University and at the Mises Institute in Auburn, Alabama

1263
02:06:57,440 --> 02:06:59,440
Where I've spent time

1264
02:07:00,280 --> 02:07:05,200
Austrian economics is a really great foundation for understanding the economic aspects of Bitcoin

1265
02:07:05,239 --> 02:07:07,239
Not so much the cryptography or the code

1266
02:07:07,320 --> 02:07:13,000
But the economics of sound money the Austrians have for decades for generations been

1267
02:07:13,399 --> 02:07:17,919
leaders in explaining how the entrepreneurial competitive market process

1268
02:07:19,239 --> 02:07:20,679
facilitates

1269
02:07:20,679 --> 02:07:23,320
civilization and wealth creation and peace

1270
02:07:24,639 --> 02:07:29,600
Von Mises was one of the key thinkers in that realm and it was cool that Satoshi himself

1271
02:07:30,200 --> 02:07:34,679
Participated in an email thread about the ideas of von Mises

1272
02:07:35,200 --> 02:07:41,720
Which we've all read if you've read Phil champagne's book the book of Satoshi by the way Phil was at the conference

1273
02:07:41,720 --> 02:07:46,760
I recognized him from the picture in the back of the book of the book of Satoshi

1274
02:07:46,760 --> 02:07:50,399
And I shook his hand and he gave me a copy of his latest book

1275
02:07:51,639 --> 02:07:53,639
which is called

1276
02:07:53,880 --> 02:07:59,399
Bitcoin versus altcoins the battle for dominance by Phil champagne forward by Preston Pish

1277
02:07:59,760 --> 02:08:04,839
So Phil is back at it with a new book after the great success of his first book

1278
02:08:05,079 --> 02:08:09,320
Which was simply a collection of everything Satoshi publicly wrote

1279
02:08:09,760 --> 02:08:17,320
put into a book with an excellent forward and some commentary on each in each chapter as he as Phil introduces

1280
02:08:17,519 --> 02:08:21,160
The concepts and then gives you exactly what Satoshi wrote

1281
02:08:22,040 --> 02:08:26,280
Which was posted on SourceForge and then the content, you know

1282
02:08:26,320 --> 02:08:33,239
Was published on Bitcoin talk and that's where the conversation continued until I think Bitcoin talk is still around

1283
02:08:33,239 --> 02:08:39,440
But now, you know, there's many different forums where people discuss Bitcoin from reddit to Twitter and Twitter spaces and elsewhere

1284
02:08:40,640 --> 02:08:46,679
But yeah, there's this thread that was on Bitcoin talk called the Mises regression theorem

1285
02:08:47,080 --> 02:08:48,359
where

1286
02:08:48,359 --> 02:08:52,799
Satoshi and his contacts were discussing publicly Mises and Rothbard and

1287
02:08:53,640 --> 02:08:58,599
That thread was what captivated my attention at the beginning of my Bitcoin journey

1288
02:08:58,599 --> 02:09:02,239
It was cool that Satoshi was talking about von Mises

1289
02:09:02,239 --> 02:09:07,840
and I think that thread may have brought in others to who have Austrian economics background and

1290
02:09:08,159 --> 02:09:13,080
notice whenever anyone's discussing von Mises in an unexpected context such as

1291
02:09:13,799 --> 02:09:15,799
cryptography or digital

1292
02:09:16,320 --> 02:09:18,320
digital economics, so

1293
02:09:18,840 --> 02:09:23,640
It's really great that Satoshi was was informed of Mises and not only was he aware of Mises

1294
02:09:23,640 --> 02:09:28,119
But he wrote that von Mises his ideas are harmonious with Bitcoin

1295
02:09:29,560 --> 02:09:35,520
Specifically the so-called regression theorem, which is a discussion about whether or not money can arise

1296
02:09:37,560 --> 02:09:40,799
Without participating first in a barter context

1297
02:09:41,640 --> 02:09:44,119
so some some economic theorists

1298
02:09:44,719 --> 02:09:46,560
puzzle over whether or not

1299
02:09:46,560 --> 02:09:49,679
Bitcoin ever was a barter good or whether it leapfrogged

1300
02:09:50,520 --> 02:09:58,119
Directly into monetary premium, which means use for use as a generally accepted medium of exchange

1301
02:09:58,640 --> 02:10:04,640
instead of being a final good like gold where you can put it into you know, a shot glass or a

1302
02:10:05,799 --> 02:10:07,799
jewelry piece

1303
02:10:10,400 --> 02:10:13,719
So, yeah, I was just saying that it's cool that you're into Austrian economics

1304
02:10:13,719 --> 02:10:15,279
but as for like the

1305
02:10:15,279 --> 02:10:21,239
Conspiracy ideas about like whether the government's involved. I don't think that it would be it wouldn't make sense for the government to

1306
02:10:21,840 --> 02:10:23,840
Want Bitcoin to succeed?

1307
02:10:24,039 --> 02:10:28,320
In the in the short term because that would deprive the government of the printing press

1308
02:10:28,799 --> 02:10:33,479
Revenue that it gets from the senior age profits of money creation in a fiat context

1309
02:10:34,279 --> 02:10:35,440
the

1310
02:10:35,440 --> 02:10:41,760
you know, the Bitcoin is so much better than any CBDC because the CBDC would be permissioned and

1311
02:10:42,279 --> 02:10:43,320
and

1312
02:10:43,320 --> 02:10:50,279
Have infinite inflation potential. So I don't think the government would release something better than Bitcoin

1313
02:10:50,520 --> 02:10:56,560
I'm sorry, the government wouldn't release Bitcoin and then plan that to be an entree or a prelude to

1314
02:10:57,320 --> 02:11:02,440
Something worse which would be permissioned and inflationary instead. I think

1315
02:11:05,039 --> 02:11:07,279
It's unreasonable to think that that's the case so

1316
02:11:07,760 --> 02:11:13,840
No, I don't I think the answer is no the government probably is not hoping that Bitcoin is a prelude to a CBDC

1317
02:11:14,159 --> 02:11:20,799
Like the Chinese CBDC isn't even on a blockchain and I don't think the US government would want our money to be on a blockchain

1318
02:11:21,599 --> 02:11:28,239
Now, of course, there are some in government who are ethical and long-term minded and want the best for society and they support Bitcoin

1319
02:11:28,239 --> 02:11:30,239
people like Ted Cruz

1320
02:11:30,239 --> 02:11:32,239
Cynthia Lummis

1321
02:11:32,880 --> 02:11:35,359
That mayor of Miami and others

1322
02:11:35,359 --> 02:11:38,679
Who and every day there's someone new right like Tulsi Gabbard

1323
02:11:39,200 --> 02:11:43,599
Ron DeSantis, is that his name Ron and other people like

1324
02:11:44,320 --> 02:11:48,400
Politicians are understanding. There's a huge market for promoting Bitcoin and

1325
02:11:49,039 --> 02:11:53,440
Getting the votes of Bitcoiners. So that is what we want to see is an ethical and virtuous

1326
02:11:54,159 --> 02:11:56,159
transition away from

1327
02:11:56,479 --> 02:11:57,679
dollar

1328
02:11:57,679 --> 02:12:01,279
Hegemony and towards a global harmonious very peaceful

1329
02:12:01,279 --> 02:12:03,359
You know sound money private property

1330
02:12:04,080 --> 02:12:06,080
ethical regime of Bitcoin

1331
02:12:06,640 --> 02:12:11,679
As the base layer for the entire monetary system. That would be great. There'd be much less war

1332
02:12:12,400 --> 02:12:16,479
As Murray Rothbard would say the welfare warfare state. There'd be much less of that

1333
02:12:17,279 --> 02:12:21,760
And there'd be more, you know anarchic value creation harmonious peaceful

1334
02:12:22,719 --> 02:12:27,359
Economic activity when money is not inflated arbitrarily by governments

1335
02:12:27,599 --> 02:12:32,159
So it's great to see more people in government being pro Bitcoin anti fiat

1336
02:12:36,320 --> 02:12:40,400
Welcome to the stage Peter sticks Bitcoin optimist

1337
02:12:41,919 --> 02:12:43,919
I definitely know are you

1338
02:12:45,279 --> 02:12:47,279
Awesome. All right

1339
02:12:48,239 --> 02:12:50,479
Well, first of all, I was I was in the

1340
02:12:51,440 --> 02:12:56,400
You know, I'm by no means an expert in any of this, but I was curious to your

1341
02:12:59,520 --> 02:13:01,520
Your opinion about

1342
02:13:01,919 --> 02:13:05,039
You know will drivechain compliment

1343
02:13:05,840 --> 02:13:10,540
no means an expert in any of this, but I was curious to

1344
02:13:10,540 --> 02:13:15,800
your opinion about, you know, will

1345
02:13:15,800 --> 02:13:20,780
Drivechains complement or compete with the Lightning

1346
02:13:20,780 --> 02:13:21,860
Network?

1347
02:13:28,719 --> 02:13:34,320
Drivechains are complementary to lightning. So that's complementary with an e after the l

1348
02:13:35,900 --> 02:13:43,859
Complementary meaning the drivechain and lightning work together perfectly and synergistically

1349
02:13:46,159 --> 02:13:48,159
Opening a lightning channel

1350
02:13:48,640 --> 02:13:55,859
On bitcoin main chain involves a bitcoin transaction on main chain, which in the future will be expensive

1351
02:13:57,200 --> 02:13:58,239
so

1352
02:13:58,239 --> 02:14:03,200
People will be able to opt in to a large block version of bitcoin

1353
02:14:04,479 --> 02:14:06,479
on a sidechain

1354
02:14:06,640 --> 02:14:13,440
It'll be totally optional just like lightning. No one has to use lightning. No one has to use a sidechain, but

1355
02:14:13,919 --> 02:14:16,500
The sidechain provides optional functionality

1356
02:14:18,719 --> 02:14:20,719
And scalability

1357
02:14:21,760 --> 02:14:23,760
and

1358
02:14:23,760 --> 02:14:26,080
Lightning on the sidechain will be possible

1359
02:14:26,880 --> 02:14:33,760
Lightning is a technology that can be used not just on bitcoin's blockchain, but on bitcoin's sidechains as well

1360
02:14:35,119 --> 02:14:40,960
I think there can even be lightning on all every altcoin if they wanted to there could be lightning on dogecoin on ethereum

1361
02:14:41,039 --> 02:14:46,260
Ethereum lightning is that kind of technology. It has like a broad application capability

1362
02:14:48,479 --> 02:14:53,760
So the work together people will be able to do lightning on thunder thunder is the name of the

1363
02:14:54,239 --> 02:14:57,919
Clone of bitcoin, which is a large block version of bitcoin

1364
02:14:58,000 --> 02:15:04,159
So it's the same as bitcoin in almost every way. The main difference is the block size is one gigabyte

1365
02:15:05,119 --> 02:15:12,080
So there was a kernel of truth in the block size war among the large blockers the kernel of truth is that

1366
02:15:12,560 --> 02:15:14,239
large block bitcoin

1367
02:15:14,239 --> 02:15:15,919
has value

1368
02:15:15,919 --> 02:15:17,359
but

1369
02:15:17,359 --> 02:15:23,039
The large blockers were wrong to think that the large block version of bitcoin should be the base layer

1370
02:15:24,000 --> 02:15:25,599
instead

1371
02:15:25,599 --> 02:15:31,840
As drive chainers, we advocate for a multi-layered view of bitcoin where every layer is optional

1372
02:15:32,640 --> 02:15:38,320
No one has to use a sidechain, but you can opt in and here's where it gets really good

1373
02:15:39,919 --> 02:15:42,320
There's no coins on the sidechain at the start

1374
02:15:42,479 --> 02:15:49,679
The only way to send coins there is to lock bitcoin in the hash rate escrow, which is the technical term for the two-way peg

1375
02:15:50,640 --> 02:15:54,099
so drivechain preserves bitcoin's monetary policy

1376
02:15:55,599 --> 02:16:01,039
The only way to create the coin on thunder would be to send bitcoin to the two-way peg which

1377
02:16:01,679 --> 02:16:03,440
mints

1378
02:16:03,440 --> 02:16:08,960
A coin of bitcoin on thunder while holding a bitcoin in the two-way peg thus

1379
02:16:09,599 --> 02:16:11,700
We take one bitcoin out of circulation

1380
02:16:12,239 --> 02:16:17,520
Holding it in the two-way peg while creating a bitcoin on the thunder sidechain with the large blocks

1381
02:16:17,919 --> 02:16:23,520
When users are finished using the thunder sidechain and they want to get their main chain bitcoin back

1382
02:16:23,919 --> 02:16:31,200
They send that bitcoin to the two-way peg that burns the bitcoin on thunder sidechain and releases it on main chain

1383
02:16:31,599 --> 02:16:33,599
As adam back has explained

1384
02:16:34,080 --> 02:16:35,279
in tweets

1385
02:16:35,279 --> 02:16:36,940
drivechain is

1386
02:16:36,940 --> 02:16:38,000
innovation

1387
02:16:38,000 --> 02:16:40,000
maximalism altcoin seniorage

1388
02:16:40,460 --> 02:16:41,760
criticism

1389
02:16:41,760 --> 02:16:43,760
So we're all about innovation

1390
02:16:44,479 --> 02:16:46,479
But we want to preserve

1391
02:16:46,479 --> 02:16:50,159
The 21 million monetary policy of bitcoin in other words

1392
02:16:50,239 --> 02:16:57,840
Imagine if every single altcoin were instead a sidechain of bitcoin the total number of coins would be 21 million

1393
02:16:59,039 --> 02:17:00,080
while

1394
02:17:00,080 --> 02:17:05,299
We would have all of the features and variety and innovation and experimentation of the altcoins

1395
02:17:06,799 --> 02:17:09,620
So that's the goal is more innovation more experimentation

1396
02:17:10,240 --> 02:17:17,200
But making sure all of it is done in a manner that accrues value to bitcoin's main chain token

1397
02:17:17,679 --> 02:17:22,480
That's the key so I think drivechain would send bitcoin's price really high

1398
02:17:23,499 --> 02:17:28,879
Potentially no one can know for sure the future but it the economic design is that we would have

1399
02:17:29,340 --> 02:17:36,960
Innovation that is happening on sidechains and all of the demand for those sidechain tokens is bringing demand for bitcoin

1400
02:17:39,360 --> 02:17:45,999
And also the fees are paid to bitcoin miners so it increases the value not only of bitcoin's token but also of bitcoin's block space

1401
02:17:46,639 --> 02:17:51,120
So that's the vision of drivechains and then lightning on the sidechains would be possible

1402
02:17:51,759 --> 02:17:54,720
As you asked about there'll be lightning on probably all of them

1403
02:17:55,279 --> 02:18:01,600
And people will be able to move coins not just within a sidechain, but it would be possible to swap

1404
02:18:02,399 --> 02:18:05,299
And this technology already exists sideshift.ai

1405
02:18:06,720 --> 02:18:12,560
And similar technology those companies and technologies would be able to enable people to swap their tokens

1406
02:18:13,440 --> 02:18:15,440
across sidechains without

1407
02:18:15,999 --> 02:18:17,999
needing to go back to main chain

1408
02:18:18,320 --> 02:18:20,320
and then professional arbitrageurs

1409
02:18:20,799 --> 02:18:27,120
Would equilibriate the demand for main chain token with the sidechain token because the peg out takes months

1410
02:18:27,600 --> 02:18:32,960
So professionals would go through the peg out while ordinary users would not they would swap

1411
02:18:33,519 --> 02:18:36,159
And pay a infinitesimally small fee

1412
02:18:36,720 --> 02:18:38,639
to do that

1413
02:18:38,639 --> 02:18:44,240
So they would swap in the secondary market. Whereas the professionals would go through the two-way peg just like

1414
02:18:45,019 --> 02:18:50,179
Ordinary people buy gasoline at a gas station and only professionals

1415
02:18:50,960 --> 02:18:52,960
use the futures market

1416
02:18:53,200 --> 02:18:54,480
for

1417
02:18:54,480 --> 02:18:56,159
oil

1418
02:18:56,159 --> 02:19:01,759
Or natural gas ordinary people buy it one way professionals are active in the

1419
02:19:02,779 --> 02:19:05,519
Institutional market which is a larger scale

1420
02:19:06,299 --> 02:19:10,799
Operation where professionals focus on making a little bit of money by moving large

1421
02:19:11,360 --> 02:19:13,279
amounts of value around

1422
02:19:13,360 --> 02:19:14,960
in the economy

1423
02:19:14,960 --> 02:19:17,120
so that's how drivechain would work Paul Sztorc has

1424
02:19:18,879 --> 02:19:22,639
Likened it to the way the energy market works where the ordinary person

1425
02:19:23,200 --> 02:19:28,639
Is not interacting directly with a power plant a nuclear power plant interacts with

1426
02:19:29,200 --> 02:19:35,919
Sort of the second layer and there's a third layer and a fourth layer and finally the ordinary consumer plugs her iphone

1427
02:19:36,560 --> 02:19:41,919
Charger into the wall in an apartment building, but that apartment building, you know is connected to like

1428
02:19:42,639 --> 02:19:43,919
A larger

1429
02:19:43,919 --> 02:19:46,399
power line that power line goes to some

1430
02:19:47,120 --> 02:19:48,320
like

1431
02:19:48,320 --> 02:19:50,080
sort of institutional grade

1432
02:19:50,080 --> 02:19:54,480
Location which eventually links up with the power plant 10 miles away

1433
02:19:54,560 --> 02:19:59,360
So there's a layered architecture in energy and similarly in drivechain

1434
02:19:59,759 --> 02:20:06,179
The vision for bitcoin is a layered architecture where the main chain is the most heavy-duty institutional

1435
02:20:07,120 --> 02:20:10,639
robust and ossified layer and above that there is

1436
02:20:11,259 --> 02:20:15,139
Existing a layer of sidechains, which are more experimental

1437
02:20:15,759 --> 02:20:19,440
More flexible and if any of those sidechains ever fails

1438
02:20:19,919 --> 02:20:25,379
No one is harmed except those who opted into it and that's exactly what we want. We want capitalism

1439
02:20:25,999 --> 02:20:28,799
People to be able to try new things create value

1440
02:20:29,440 --> 02:20:34,580
In a manner that accrues value to bitcoin. The worst thing for bitcoin is to have increasingly

1441
02:20:35,440 --> 02:20:38,240
the growth of altcoins altcoins threaten

1442
02:20:38,960 --> 02:20:44,320
Bitcoin's network effects altcoins deprive bitcoin of transaction fee revenue

1443
02:20:44,960 --> 02:20:50,720
That we want paid to bitcoin miners altcoins deprive bitcoin of users

1444
02:20:51,360 --> 02:20:52,639
and voters

1445
02:20:52,639 --> 02:20:57,860
And loyalty and all of the irl features that altcoins are accumulating

1446
02:20:58,799 --> 02:21:04,720
In their communities. We want that to be on bitcoin instead. So that's what drivechain is all about. It's about

1447
02:21:05,179 --> 02:21:07,679
enabling all these developments to occur on

1448
02:21:08,299 --> 02:21:09,679
bitcoin

1449
02:21:09,679 --> 02:21:16,560
And at the at the at the essence of drivechain is the understanding that some altcoins have value

1450
02:21:17,360 --> 02:21:19,120
They're not all scams

1451
02:21:19,120 --> 02:21:21,120
The privacy altcoins have value

1452
02:21:21,519 --> 02:21:25,919
The altcoins focused on oracles have value the altcoins focused on

1453
02:21:26,720 --> 02:21:28,080
high speed

1454
02:21:28,080 --> 02:21:29,039
low

1455
02:21:29,039 --> 02:21:31,039
Fee payments have value

1456
02:21:31,679 --> 02:21:39,679
The altcoins focused on dns have value there is a wide variety of applications which aren't possible on mainchain bitcoin

1457
02:21:40,879 --> 02:21:47,120
And they have value. I mean we should enable them on bitcoin sidechains right now bitcoin sidechains are not peer-to-peer

1458
02:21:47,519 --> 02:21:49,519
Every one of them has a federation

1459
02:21:50,480 --> 02:21:53,279
Which are which means people that are socially selected

1460
02:21:53,519 --> 02:22:00,899
It doesn't matter if they enable the federation to be a thousand people using the latest like taproot innovations

1461
02:22:01,360 --> 02:22:05,759
Even if there's a thousand people they're socially selected and therefore it's not peer-to-peer

1462
02:22:06,159 --> 02:22:12,560
The only way to make the altcoins perfectly harmonious with bitcoin and to give them the strongest possible narrative

1463
02:22:12,960 --> 02:22:14,980
Is if they are arguably peer-to-peer

1464
02:22:15,679 --> 02:22:17,679
And as adam back says in his tweets

1465
02:22:18,240 --> 02:22:21,999
drivechain would make the sidechains more peer-to-peer by

1466
02:22:22,779 --> 02:22:26,259
graduating them from these socially selected federation

1467
02:22:26,860 --> 02:22:29,759
membership model to a model which

1468
02:22:30,399 --> 02:22:34,399
Anyone can participate in the security model of the of the sidechain

1469
02:22:34,879 --> 02:22:37,039
Because the miners are controlling the sidechain

1470
02:22:37,600 --> 02:22:41,279
And the sidechain rather the sidechain two-way peg the miners control

1471
02:22:42,159 --> 02:22:44,960
And anyone can be a miner. All you need is some money

1472
02:22:45,360 --> 02:22:53,279
So the only barrier is economic not social and that's the meaning of peer-to-peer. I think when satoshi said bitcoin is a peer-to-peer

1473
02:22:53,999 --> 02:22:57,039
Electronic cash system. That's what he meant. He meant no one

1474
02:22:57,679 --> 02:23:04,080
Is privileged no one is socially no one is socially selected to perform any role anyone can

1475
02:23:04,720 --> 02:23:06,879
Participate in mining anyone can have a node

1476
02:23:07,759 --> 02:23:09,759
Anyone can get involved in any of the roles

1477
02:23:10,639 --> 02:23:16,419
With economic barriers being the only kind of barrier no social barrier. No one's being selected and privileged

1478
02:23:17,999 --> 02:23:19,999
I got a couple more questions. So

1479
02:23:20,320 --> 02:23:26,240
Um, is there so in essence you're telling me that drivechains could potentially be the shit coins

1480
02:23:26,720 --> 02:23:29,840
killers, like, you know, there'll be no longer a need for

1481
02:23:30,799 --> 02:23:32,799
other tokens or or

1482
02:23:33,840 --> 02:23:36,799
digital currencies and then the second question how many

1483
02:23:38,080 --> 02:23:40,080
sidechains can we have

1484
02:23:40,480 --> 02:23:42,480
uh along bitcoin

1485
02:23:42,879 --> 02:23:44,879
So

1486
02:23:45,039 --> 02:23:47,840
Sidechains on bitcoin can be very high in number

1487
02:23:48,399 --> 02:23:53,039
The designers of drivechain think that probably they'll just be about 20

1488
02:23:54,159 --> 02:23:56,159
Sidechains, but there could be many more

1489
02:23:56,320 --> 02:24:02,720
We don't know what the bitcoiners will develop people like Super Testnet and CryptAxe and others people who are really

1490
02:24:03,419 --> 02:24:09,360
Sophisticated about the code of bitcoin and what sidechains can offer might develop all kinds of interesting sidechains

1491
02:24:10,159 --> 02:24:15,120
But the fact is right now that there's only about 10 or 20 that are envisioned because

1492
02:24:16,080 --> 02:24:19,440
That's how many interesting and valuable applications exist

1493
02:24:20,799 --> 02:24:24,820
In the view of the drivechain community at this time, but there could be hundreds

1494
02:24:25,519 --> 02:24:28,240
if desired if the community desires that there be

1495
02:24:29,039 --> 02:24:31,679
hundreds of drivechain sidechains there could be

1496
02:24:32,240 --> 02:24:34,639
The drivechain code allows for a few hundred

1497
02:24:35,600 --> 02:24:42,480
And if it were ever necessary there could easily be a change made that would enable thousands of them if that were desired

1498
02:24:43,279 --> 02:24:45,200
and and

1499
02:24:45,200 --> 02:24:50,080
You know a lot of the reasons why we have a lot of shit coins is because speculations and you know new

1500
02:24:50,960 --> 02:24:54,960
Uh, you know shit coins and people want to get in so that this would be eliminated, right?

1501
02:24:54,960 --> 02:24:56,960
Because everything will be under bitcoin

1502
02:24:57,039 --> 02:24:58,560
And it would be whatever

1503
02:24:58,560 --> 02:25:00,560
You know price, you know

1504
02:25:00,639 --> 02:25:02,639
Supply and demand on bitcoin, right?

1505
02:25:04,639 --> 02:25:06,639
Yeah, everything would be built on bitcoin

1506
02:25:07,440 --> 02:25:11,600
And the demand for the monetary token on every one of the sidechains

1507
02:25:12,159 --> 02:25:16,879
Would create demand for bitcoin because the only way to create the monetary token

1508
02:25:17,200 --> 02:25:22,080
On each of these sidechains is to lock up bitcoin in the hash rate escrow. So

1509
02:25:22,799 --> 02:25:24,799
the 21 million limit

1510
02:25:24,799 --> 02:25:26,799
of bitcoin's monetary policy

1511
02:25:27,039 --> 02:25:33,299
Is preserved through drivechain while enabling all of the functionality of altcoins

1512
02:25:34,179 --> 02:25:40,499
This would cause I believe the altcoiners to drop their altcoins to sell them for bitcoin

1513
02:25:40,980 --> 02:25:43,220
Sending the value of the altcoins to zero

1514
02:25:44,259 --> 02:25:49,139
As the users of the altcoins migrate to bitcoin sidechains, for example

1515
02:25:49,860 --> 02:25:51,960
the monero and zcash communities

1516
02:25:53,060 --> 02:25:56,259
Their altcoins are worth a few billion dollars in total

1517
02:25:57,620 --> 02:26:03,060
Those two altcoins. I think those communities will drop their altcoins. They'll sell them for bitcoin

1518
02:26:03,620 --> 02:26:08,019
To use the sidechains that are literally clones of their code

1519
02:26:08,259 --> 02:26:12,419
Their code is open source. Anyone can take it and put it into the sidechain

1520
02:26:13,220 --> 02:26:14,659
and

1521
02:26:14,659 --> 02:26:16,019
then

1522
02:26:16,019 --> 02:26:18,019
Those sidechains will be

1523
02:26:18,419 --> 02:26:20,820
A combination of bitcoiners who opted in

1524
02:26:21,379 --> 02:26:27,379
To those sidechains along with the altcoiners who moved from their altcoins to the bitcoin sidechains

1525
02:26:27,940 --> 02:26:33,060
There's already a sidechain in a test net for drivechain called zside that uses zcash

1526
02:26:34,240 --> 02:26:36,240
Technology, but with a bitcoin token

1527
02:26:36,980 --> 02:26:38,980
It's a very powerful upgrade

1528
02:26:39,860 --> 02:26:45,879
For the privacy cypherpunk community to finally be able to use the latest and greatest technology

1529
02:26:46,740 --> 02:26:51,139
For privacy but with bitcoin as the unit of account and with all the transaction fees

1530
02:26:51,700 --> 02:26:54,919
being paid to bitcoin miners adam back explicitly

1531
02:26:55,879 --> 02:26:57,879
Wrote in favor of this

1532
02:26:58,279 --> 02:27:00,279
If you go to drivechain

1533
02:27:00,279 --> 02:27:03,240
dot info forward slash friends you can read

1534
02:27:04,360 --> 02:27:06,999
This is a spreadsheet I made if you look at line

1535
02:27:08,919 --> 02:27:13,159
Nine on Drivechain.info forward slash friends adam back wrote

1536
02:27:14,039 --> 02:27:20,519
In this tweet that I pasted here truthcoin made a testnet bitcoin sidechain drivechain with zcash crypto for a reason

1537
02:27:20,840 --> 02:27:28,120
I wouldn't buy the altcoin, but I would try and use the drivechain version zcash protocol is a bit risky

1538
02:27:28,840 --> 02:27:33,399
Is a bit risk rnd risky like research and development risky for bitcoin main chain

1539
02:27:34,200 --> 02:27:37,560
Due to reliance on recent and experimental cryptography. In other words

1540
02:27:38,039 --> 02:27:40,039
Dr. Back there is saying

1541
02:27:40,039 --> 02:27:41,560
Zcash is cool

1542
02:27:41,560 --> 02:27:46,919
I don't want to use the altcoin but I would be excited to use the the drivechain sidechain version

1543
02:27:47,240 --> 02:27:53,480
Because then you're using a bitcoin on the sidechain with this strong cypher punky

1544
02:27:54,019 --> 02:27:57,659
Privacy technology. So it's the privacy tech of zcash

1545
02:27:58,200 --> 02:28:06,039
With bitcoin's monetary policy. It's the best of all worlds. It is literally a win win for everyone involved

1546
02:28:06,840 --> 02:28:09,240
except probably the zcash founders who are like

1547
02:28:10,519 --> 02:28:12,679
owning a giant bag of zcash

1548
02:28:13,560 --> 02:28:19,340
So they might they might lose out but but almost everyone in the whole community wins in zcash

1549
02:28:19,639 --> 02:28:22,460
If they drop their altcoin and join the bitcoin community

1550
02:28:22,919 --> 02:28:27,320
Because then they get access to like the massive multitude of bitcoin's network effect

1551
02:28:30,120 --> 02:28:32,120
That's great, thank you

1552
02:28:32,919 --> 02:28:35,080
We've been running for quite a while

1553
02:28:36,120 --> 02:28:38,600
We started at 9 30. It's now 12. So it's been

1554
02:28:39,480 --> 02:28:41,480
two and a half hours

1555
02:28:41,480 --> 02:28:44,440
Perhaps we should wrap and regroup on monday

1556
02:28:46,679 --> 02:28:48,679
Does that sound good to you peter

1557
02:28:48,919 --> 02:28:55,899
Sounds good to me drivechain twitter spaces happens every monday and thursday. We talk about bips 300 and 301

1558
02:28:57,080 --> 02:29:00,759
We talk about how this can increase bitcoin's strength in so many ways

1559
02:29:01,639 --> 02:29:02,840
more

1560
02:29:02,840 --> 02:29:05,980
fees for the miners more innovation and development

1561
02:29:06,779 --> 02:29:12,060
A greater platform for bitcoin builders on sidechains sidechains that are more peer-to-peer

1562
02:29:12,940 --> 02:29:14,940
growing bitcoin's network effect

1563
02:29:15,320 --> 02:29:19,259
absorbing all of the users and value of altcoins sending bitcoin to the moon

1564
02:29:20,060 --> 02:29:25,820
And sending bitcoin past a million dollars a coin. That's our dream. That's our vision. We think this is the best strategy

1565
02:29:27,499 --> 02:29:29,499
And we're excited to be

1566
02:29:29,499 --> 02:29:33,259
Talking about it. Thanks everyone for being here. This is a recorded space

1567
02:29:33,340 --> 02:29:39,499
If you joined late, you can listen to the recording just follow us on LayerTwo Labs. It's posted there as soon as the space ends

1568
02:29:40,139 --> 02:29:41,899
Hope to see you all on monday in the meantime

1569
02:29:41,899 --> 02:29:46,399
Check out our telegram group drivechain talk and our website layer2labs.com

1570
02:29:47,580 --> 02:29:49,580
And also drivechain.info