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Welcome to Drivechain Twitter Spaces.

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Today is Friday, June 9th.

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We're excited to have another chat about Drivechain.

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Everyone is welcome to come on up to the stage and join our lively conversation.

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We talk about Bitcoin Improvement Proposal 300 and 301.

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Drivechain refers to those two BIPs.

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Drivechain is BIP300 and BIP301.

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Drivechain is an idea to develop better sidechains on Bitcoin.

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Sidechains that are more peer-to-peer, as Adam Back has described it.

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Sidechains that do not use a socially selected set of parties to control the Bitcoin sent to the sidechain.

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Instead, the peer-to-peer network of Bitcoin miners play an important role in the security model of the sidechains.

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I see some familiar faces in the audience.

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Welcome to those who have joined us in the past, and welcome to anyone new who comes to chat about Drivechain.

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Hello, Moonsettler. If you would like to chat, come on up to the stage.

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Happy Friday to you.

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Welcome, everyone.

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We are excited to have another Drivechain Twitter Spaces today.

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Hello, here we are. Happy Friday to all.

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Happy Friday.

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Happy reduction in the Quebec fumes.

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Yes, yes.

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For those who may be listening, there were recently a bunch of fires.

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Yes, sadly.

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All over the East Coast.

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Very unfortunate.

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All right.

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One of the topics of today's conversation will be how Drivechain is all-time high technology.

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It is very possible that the adoption of Drivechain would have a significant bullish effect on Bitcoin's price and a negative effect on the price of altcoins, even before activation.

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The mere possibility of activation could be bullish for Bitcoin because in economics, participants in the economy are future oriented and they speculate.

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So the price for Bitcoin at any moment is a reflection of everyone's expectations of its future demand.

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And therefore, if Bitcoin upgrades its sidechains, then potentially the technology that is currently only available in a peer-to-peer arrangement on altcoins could be copied then to Bitcoin sidechains.

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And that would lead to number go up effects on Bitcoin's price.

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It's very exciting.

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I think the idea is like, what if the traditional financial system just like collapsed or went away tomorrow?

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Would Bitcoin be able to replace all of that infrastructure?

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And the answer is clearly no right now.

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But with 5300, it would kind of be yes, sort of.

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Makes a pretty big difference.

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Yes.

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Moonsettler, in the past, I recall we discussed that you don't have as much confidence as I do in the probability that Drivechain adoption would be very bullish for Bitcoin's price.

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Maybe you'd like to share your thoughts on whether that's the case.

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In his conversation with Brad Mills and Jameson Lopp and Austin Alexander at Satoshi Roundtable, Adam Back said that when the 2014 white paper came out from Blockstream on sidechains, there was a moment where the altcoins fell in price.

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People thought, oh, everything is going to move to Bitcoin.

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Everything.

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And I believe Drivechain will bring us to that kind of moment again, except that Drivechain, unlike that white paper, will have a real permanent effect potentially, where the value will flow to Bitcoin as the technology and users from the privacy coins and all the other valid altcoins.

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All those users and value will flow to Bitcoin and that will make Bitcoin once again, as it was years ago, the center stage of technology in the blockchain space.

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The reason why I have doubts about that is because I think that may have had a time window, but I'm not sure the time window has not closed now for various reasons.

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So it may have been true back then, but I'm not sure it is true now in the current state.

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So that is something that is a reason why I'm having doubts about that.

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But mainly I wanted to talk about a topic that has popped up in relation to Drivechains.

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I have seen some debate around whether Covenant Primitives can be used to implement Drivechains and how that could look like or how close it could get.

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And when you guys are ready, I would like to maybe talk about that.

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So I'm not in a hurry.

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Feel free to.

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Paul, would you like to do that?

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I think that's a good idea.

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Great.

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Did you see what I was talking about with SuperTestNet?

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And then there was a little back and forth.

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And then I wrote a tweet about that.

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And speaking of random tweets, can we put in the nest all the tweets that we had last week or whenever?

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It seems like we have a good collection.

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That's pretty cool.

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Yes.

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But, yeah, the one I'm talking about was this one where I said I was going to shed a little light on it.

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And I said basically what is going on with BIP300 is or what's going on with any sidechain idea or any SPV proof.

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The SPV proof is saying it only proves the work and not the validity on Layer 1 because Layer 1 doesn't want to know everything, every detail of what's going on.

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This is a weird intersection of a lot of ideas such as Andrew Paul Stroh's using blockchains, what chains are for, type of an idea.

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The proof should always – there's lots of, like, nuance and weird intersecting ideas.

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But basically what I'm saying is the – in the sidechain idea as conceived not only by me but also by Blockstream and everyone is this SPV proof idea.

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And the SPV proof idea is this, like, miner you prove the work only.

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It's like the miners can steal issues tied into it inescapably.

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And the – what I'm trying to get at is it's like a miner courtesy is every SPV proof.

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And so what you do is you start with that and then you try to make it more and more and more and more difficult for the miners to actually misbehave.

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And that's what BIP300 tries to do.

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And so that's what I'm really getting at as, like, to whether or not something replicates that is really a function of that.

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So I don't know if this makes sense. Does this make any sense to you, Moonset?

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What I'm trying to say is that, like, the – every – just doing nothing, you already have sidechain if you want to trust the miners completely.

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But then you slowly try to make it more and more difficult for miners to misbehave.

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And that's the idea of sidechains is to make it as difficult as possible.

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But without ever actually – the only perfect way to enforce, to make perfect deposit withdrawal system is to just force the miners to enforce all sidechain rules.

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But then you – it's like shuffleboard where you make it as far as possible, as far as you can.

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But then if you go too far, then you lose everything because forcing the rules to become part of the protocol just merges everything back into layer one.

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And then you have failed to make a sidechain.

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So this is why it gets kind of confusing to me to analyze what exactly people mean when they say we can do drivechains with something else.

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So that was where I was trying to get at.

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Yeah. First of all, I would like to make it clear that I don't believe that we can call those things drivechains.

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So I don't think it fits the bill.

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So it's not a proper hash rate escrow for the coins.

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But I would very much like if we could do something better than the spacechains where the one-way peg requires the coins to be burned.

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I don't like the idea that we are permanently locking coins into utilities.

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And the whole thing is a bit hard to – I mean you could fold the spacechain as many times as you want and they could all lay claim to the same burned coins.

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What is exactly stopping them from it?

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So I don't particularly like the first or the ancient original spacechain idea.

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And I think we can do something in between with simple Covenant primitives.

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The one thing I wanted to mention first is if you want to move towards perfection where the miners can steal and can cheat

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and we don't have some federation or arbiter to hang above our head and we still want to basically have something like it.

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I guess the closest we can get to that is the zero-knowledge stuff.

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So we could use zero-knowledge proofs that clients' nodes can validate without actually having necessarily the data.

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They only check – they don't validate the data, the raw data, they just check that it is available.

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So it's possible to add a short-lived blob space to an extension blob space to Bitcoin.

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So let's assume in the future bandwidth becomes less of a problem but we don't want Bitcoin to bloat forever.

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It could be a tradeoff where we say, all right, we are keeping these blobs around for four weeks, these extension blobs, and you can put roll-up data in there.

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In fact, you have to put roll-up data in there for the proofs to validate.

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And after the four weeks, the nodes will just prune it because we assume that everyone who participates in the roll-up have come online at least once in that four weeks.

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If not, that's on them.

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But it's very unlikely that they would lose access to this data.

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If a lot of people have it, it's highly replicated with those who actually want to use it.

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So these are pretty good assurances that people can be denied service and can be rugged and stuff like that.

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And that is a possible way to move forward with this.

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I believe that is not SPV exactly, and it's not trusting some third party or a federation.

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And I'm not sure how far we are from that, but it has the distinct tradeoff that you actually need the bandwidth.

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So mainchain nodes need to download the roll-up data even if they don't execute and don't verify it.

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And that's still a tradeoff compared to SPV proofs and drivechains.

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So I have...let's see.

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Do we have the...why doesn't it work?

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Do we have that tweet where the...

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Are you talking about the tweet that I was talking about?

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Yeah, someone was saying that you can implement drivechains with CTV or APO or something like that.

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Anyhow, I don't think that is true.

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So the hash rate has to be implemented in such a way.

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Of course, we can do blind merge mining.

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So with the Kovanon protocol, we don't have the problem with the key deletion trusted setup thing.

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So we can do trustless blind merge mining.

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And in this way, I would set it up, of course, so that it is allowing formal liability.

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And basically, that means we are not really predetermining the transaction IDs that follow each other

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because someone would add fees to the blind merge mining.

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Someone would add fees and someone would put in an OP_RETURN every block.

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And the relative time nodes would ensure that you can only advance this thing once a Bitcoin block.

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And basically, you can create a chain for like a thousand years or however long you want.

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Or three months, whatever.

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You can create this chain and anyone can drive it forward.

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Anyone can execute these transactions.

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They don't require an authorization.

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And anyone can bid for main block inclusion.

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And they can collect the fees on the sidechain.

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And they can bid for this transaction on the main chain.

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And that's the very, very simple concept.

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And the one thing that you can do with Kovanon, because you almost can do this.

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Almost the same thing you can do something like this with anyone can spend.

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But what you can do with anyone can spend is that if let's assume that a sidechain that offers a certain utility has a sponsor.

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And this sponsor locks in his capital in this funding transaction.

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And this funding transaction has a set release to his custody of this sidechain fund.

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And basically, the sidechain rule set requires the equal amount of sidechain coins to be burned for a valid block.

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Of course, we can make some allowances.

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So for it to be economically recoverable, maybe the amounts are not released to the founder every block.

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But say every 10 block, every day, something like that.

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So it would be more like a staircase.

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But on the sidechain, you would have to burn a fixed amount compared to that sidechain coin.

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So the economic balance, the peg is maintained.

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And basically, this means that only one person can peg funds into the sidechain.

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And only one person can get the funds out.

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But he can't get them out faster.

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There is no way for him to get them out faster.

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And the following happens.

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If he tries to get his funds out and tries to screw the sidechain side and tries to ignore people who want to transact on the sidechain,

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first of all, he would have to outbid them.

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And then he would have to pay these fees to the miners.

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And that means that he might actually burn more on these than what he gets out.

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So he's burning his money if he's screwing with this.

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He's very heavily incentivized to provide a good service to people who want to use his sidechain, who want to use his liquidity, his capital.

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And those people would assemble the sidechain blocks based on their economic demand, their activity that they want to do there.

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And they would bid for fees.

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And they would drive this contract forward.

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And thus the founder gets his money out without actually having to spend on transaction fees.

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And he would get some extra out.

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So if he puts in, say, 100 Bitcoin, then he would get out, say, 101 Bitcoin or something like that in three months.

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That's not a horrible thing in a hyper-Bitcoinized world.

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And so this difference comes from a small cut on the fees.

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Let's say we are doing it with CTV.

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So the CTV templates would enforce a contract, basically, that chains the first input.

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And it always outputs a little bit more than what comes in from the first input.

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And that difference has to come from the fee input.

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So someone is making a fee input.

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With the transaction that he funds, the fee input, he has to put in the up-return for the sidechain block.

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And then he has to put in some money.

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And he pays the founder.

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And he pays the miners to drive this thing forward.

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And I believe this is what I call sur-chain.

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Because basically you are the big wave of liquidity and ride it out.

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You are the big wave of liquidity, ride it out.

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You can only append to the end.

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But, of course, once you lock into a Covenant contract and it's confirmed, then you have access to that liquidity on the sidechain.

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Because it is no longer possible to spend it any other ways.

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So, basically, if the founder can guess well how much the amount will be for his liquidity on the sidechain.

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And he pays a little bit of a market maker there to make people want to use it.

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Because the primary utility in this is actually the peg, the price peg.

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So he would buy and sell.

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He would be a market maker.

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And if he manages his liquidity well.

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If he doesn't lock in too much, when there is just no economic demand for it. And he is not screwing with the users.

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Then he will make like 1% on his investment every 3 months.

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And if he is screwing with the user, if he overestimated the demand, if he is fucking up, he will lose a lot of money on it.

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So he will get out a lot less than what he put in.

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And that is the basic idea of the surfchains.

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And I think this is as close as we can get to a drivechain. But it's totally not a drivechain.

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It's not a hash. It has screws. The miners can steal. The founder can steal.

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The only thing the founder can do is fuck off and leave people alone.

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And stop stabilizing the sidechain price.

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And even then, people who participate in this can actually still continue without him.

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But that sidechain is basically doomed to die.

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If the founder leaves and is not willing to add additional liquidity, then it will eventually die.

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And probably the price, the exchange rate will be out of whack.

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So it's not going to be a good experience.

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But it's almost certain that the founder will lose money on not being a good actor.

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So it's not clearly a custodial relationship so much.

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And it's weird. I don't know what is the good name for it.

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But it feels to me that a reputable financial institution or organization or person could run this.

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And people could be reassured that they are not getting drugged in any way.

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And it's really nothing in his interest. Literally can't.

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00:21:23,867 --> 00:21:28,867
He only maximizes his revenue if he is playing nice, I believe.

212
00:21:28,867 --> 00:21:32,867
So this is the thing that you can do with a simple Covenant primitive.

213
00:21:32,867 --> 00:21:41,867
And that is a far cry from a real two-way peg or a real drivechain, I believe.

214
00:21:41,867 --> 00:21:47,867
And that is why I don't like it when people say, oh, we can do drivechains with Covenants.

215
00:21:47,867 --> 00:21:51,867
I don't think so. At least not with something so simple.

216
00:21:52,867 --> 00:21:54,867
Cool.

217
00:21:54,867 --> 00:22:02,867
Yeah, I think – I mean there's a lot of weird – like people go through different moods.

218
00:22:02,867 --> 00:22:05,867
Like people hated CTV, but now they like it.

219
00:22:05,867 --> 00:22:09,867
So I guess CTV is the likable-approved thing.

220
00:22:09,867 --> 00:22:13,867
So I always liked CTV myself.

221
00:22:14,867 --> 00:22:16,867
I always liked CTV myself.

222
00:22:16,867 --> 00:22:28,867
I'm not exactly sure what – I haven't actually compared op-vault to op-ctv yet at all, just because I haven't gotten to it yet.

223
00:22:28,867 --> 00:22:33,867
Yeah, so lately op-vault includes op-ctv.

224
00:22:33,867 --> 00:22:37,867
And interestingly, Matt Merkle has all the things.

225
00:22:37,867 --> 00:22:44,867
Also includes CTV as a building block, a component, something they would like to build on.

226
00:22:44,867 --> 00:22:46,867
And another interesting thing is Arc.

227
00:22:46,867 --> 00:22:54,867
I actually spent some time lately trying to come up with ways how I would implement Arc with CTV or APU.

228
00:22:54,867 --> 00:22:58,867
And it actually turns out that it's a lot better with CTV.

229
00:22:58,867 --> 00:23:07,867
I'm not even sure it's actually workable with APU, because – I don't want to get too deep into this –

230
00:23:07,867 --> 00:23:12,867
but basically APU, from what I found in the code, does not commit to the number of inputs.

231
00:23:12,867 --> 00:23:16,867
So if you can add additional inputs, you can mullet the takes either.

232
00:23:16,867 --> 00:23:24,867
You can only prevent this if you add a single sig, but if you add a single sig, then basically the ASP can play games.

233
00:23:25,867 --> 00:23:30,867
If you want to make it trustless, you would have to make it an n-of-n signature.

234
00:23:30,867 --> 00:23:32,867
And then, what is the purpose of APU?

235
00:23:32,867 --> 00:23:36,867
It's almost completely unnecessary at that point.

236
00:23:36,867 --> 00:23:38,867
We are back to the fully interruptive setup.

237
00:23:38,867 --> 00:23:44,867
And CTV is just such a smooth sailing, and it's actually cheaper and simpler.

238
00:23:44,867 --> 00:23:50,867
Cheaper for validation, cheaper for plot space, and it's perfectly suitable for this thing.

239
00:23:50,867 --> 00:23:55,867
So these small things come together in people's minds, and they slowly see through.

240
00:23:55,867 --> 00:24:05,867
And I think that is why, among other things, CTV is gaining popularity, even though it was very, very unpopular a year ago.

241
00:24:10,867 --> 00:24:12,867
Yeah, people said all kinds of weird stuff.

242
00:24:13,867 --> 00:24:23,867
What will happen if we have covenants will be that someone will make a covenant where the child coin must have the covenant,

243
00:24:23,867 --> 00:24:33,867
and it also must be signed by a whitelisted government agent, and then the coins will just be tainted forever.

244
00:24:33,867 --> 00:24:40,867
And then more and more coins will be tainted, and therefore then this one government agency will have all the power,

245
00:24:40,867 --> 00:24:44,867
and then it will just be, Jeremy Rubin has destroyed Bitcoin.

246
00:24:44,867 --> 00:24:47,867
That's something serious that people said.

247
00:24:48,867 --> 00:24:51,867
Yeah, so I want to add two things.

248
00:24:51,867 --> 00:25:01,867
Of course, now I think everyone understands that the receiver decides the address and the script that he receives to.

249
00:25:01,867 --> 00:25:09,867
So if you send me a coin where it's logged in a two-of-two with you and me, I will not accept that as payment,

250
00:25:09,867 --> 00:25:18,867
and I will tell you to go somewhere warm and not deliver you the service or the product that you want,

251
00:25:18,867 --> 00:25:22,867
unless this is what we agreed on, unless this is an escort-type thing.

252
00:25:23,867 --> 00:25:35,867
But the point is the receiver decides how he gets paid, and so that pretty much annuls or kills these FUD points.

253
00:25:35,867 --> 00:25:41,867
But basically, if you really want to, you can do similar things with introspection.

254
00:25:41,867 --> 00:25:48,867
So if you have opcodes similar to the elements opcodes on Liquid or what Bcash has,

255
00:25:48,867 --> 00:25:56,867
then you can actually dig into the transaction details from the script,

256
00:25:56,867 --> 00:25:59,867
and you can insist on certain script types.

257
00:25:59,867 --> 00:26:10,867
So you could create coins that are forever logged into, say, taproot, pay-to-taproot outputs or something like that.

258
00:26:10,867 --> 00:26:12,867
It doesn't really make sense.

259
00:26:12,867 --> 00:26:15,867
And again, you could not pay anyone with it.

260
00:26:15,867 --> 00:26:20,867
So if you are telling someone that you have to download this wallet or I can't pay you,

261
00:26:20,867 --> 00:26:24,867
or I paid you but you have to download this wallet to spend it,

262
00:26:24,867 --> 00:26:27,867
then he will probably tell you to screw yourself.

263
00:26:27,867 --> 00:26:34,867
So it's not really working, I think, the way Bitcoin works and the way people use Bitcoin.

264
00:26:34,867 --> 00:26:38,867
It's just not very possible.

265
00:26:39,867 --> 00:26:42,867
I agree. That was like concern trolling, basically.

266
00:26:42,867 --> 00:26:48,867
People were just like, oh, this is a really, really clever, kind of impressive argument we could make.

267
00:26:48,867 --> 00:26:53,867
And so they just made it for kudos on the Bitcoin dev mailing list,

268
00:26:53,867 --> 00:27:00,867
not because it was true and actually it ended up harming the program.

269
00:27:00,867 --> 00:27:04,867
Yeah, it somehow blew up in the pleb circles.

270
00:27:04,867 --> 00:27:06,867
It really, really blew up.

271
00:27:06,867 --> 00:27:14,867
And I think it was partly because a lot of people or most people were sleeping on Covenants

272
00:27:14,867 --> 00:27:21,867
and a few devs who were aware of them were still unsure how to approach this whole thing.

273
00:27:21,867 --> 00:27:23,867
They were otherwise occupied.

274
00:27:23,867 --> 00:27:27,867
They did not have the time to really deeply think about it.

275
00:27:28,867 --> 00:27:34,867
And so there was not really a settled understanding in the space,

276
00:27:34,867 --> 00:27:39,867
not even maybe among the devs, let alone the wider community.

277
00:27:39,867 --> 00:27:45,867
And people were caught a little bit off guard with an activation effort.

278
00:27:45,867 --> 00:27:50,867
And when some people started screaming, it, of course, spread like wildfire.

279
00:27:50,867 --> 00:27:56,867
And there was this backlash, but things seemed to have calmed down considerably.

280
00:27:56,867 --> 00:28:05,867
And now people are appreciating some of the aspects and some of the things that Covenants could give us,

281
00:28:05,867 --> 00:28:08,867
especially with this Ordinal's inscription thing.

282
00:28:08,867 --> 00:28:17,867
So I think now people have this understanding that if we add more main chain block space,

283
00:28:17,867 --> 00:28:22,867
and it is a more permanent block space, like I said, if we just add a four-week block space,

284
00:28:22,867 --> 00:28:27,867
I don't think people will put JPEGs on that because it has no permanence.

285
00:28:27,867 --> 00:28:29,867
It has no promise of permanence, right?

286
00:28:29,867 --> 00:28:32,867
So it's not really suitable for that.

287
00:28:32,867 --> 00:28:37,867
But if you add permanent block space, probably it's going to fill to the brim with garbage,

288
00:28:37,867 --> 00:28:40,867
even if there is no demand for block space.

289
00:28:40,867 --> 00:28:46,867
And this new understanding with the people who actually understand the scaling limitations

290
00:28:46,867 --> 00:28:56,867
when Layer 1 blockchain phases actually made them think, start to think outside the box and start to appreciate it.

291
00:28:56,867 --> 00:28:58,867
The high fees probably helped a lot.

292
00:28:58,867 --> 00:29:01,867
So people felt uncomfortable.

293
00:29:01,867 --> 00:29:05,867
Lightning node operators suffered with it.

294
00:29:05,867 --> 00:29:10,867
And so a new understanding dawned on people.

295
00:29:11,867 --> 00:29:20,867
And I think it's really something that we should try and see how far we can push it.

296
00:29:20,867 --> 00:29:22,867
So how far we can go.

297
00:29:22,867 --> 00:29:25,867
I don't think it will solve all the problems of Bitcoin forever.

298
00:29:25,867 --> 00:29:28,867
I'm not ready to say that.

299
00:29:28,867 --> 00:29:33,867
But it certainly points to the good direction, I believe.

300
00:29:33,867 --> 00:29:38,867
But as I like to say, we're eventually going to need more block space.

301
00:29:38,867 --> 00:29:40,867
There is just no way around it.

302
00:29:40,867 --> 00:29:44,867
And of course, people don't like to hear this.

303
00:29:44,867 --> 00:29:48,867
A lot of people don't like to hear this, but I still think it is true.

304
00:29:48,867 --> 00:29:58,867
And of course, like I said, mandatory block extension is not looking like a viable thing or something that would be very popular.

305
00:29:58,867 --> 00:30:03,867
So we are back to non-mandatory block space extension, right?

306
00:30:03,867 --> 00:30:07,867
And that's basically sidechains, the old idea of sidechains.

307
00:30:08,867 --> 00:30:16,867
Yeah, I mean, maybe we should talk about the complete futility of various alternatives to BIP300, really.

308
00:30:16,867 --> 00:30:22,867
Which is that, like, the futility of the idea.

309
00:30:22,867 --> 00:30:26,867
Like, how can we summarize it in a way that people actually understand, though?

310
00:30:26,867 --> 00:30:37,867
Which is like, I think of it as like there's like an on-ramp, off-ramp problem that BIP300 solves by adding a tiny bit of trusting the miners.

311
00:30:37,867 --> 00:30:48,867
And that everything else, the solution for even things like Lightning or ARK, they either, in the case of Lightning, they don't solve it at all.

312
00:30:48,867 --> 00:30:50,867
The onboarding part.

313
00:30:51,867 --> 00:30:56,867
And the offboarding part actually involves more trusting the miners in the high-fee rate environment.

314
00:30:56,867 --> 00:31:01,867
But I don't know how we can, like, summarize it in a way that...

315
00:31:01,867 --> 00:31:06,867
What do you think of this onboarding-offboarding way of framing it?

316
00:31:06,867 --> 00:31:18,867
So the thing is, if we are staying on the happy path and we are optimistic about how people behave and how things play out,

317
00:31:18,867 --> 00:31:22,867
I would say ARK easily solves this problem.

318
00:31:22,867 --> 00:31:35,867
So it can, I believe, actually help people hold these virtual UTXOs for, like, billions of people even.

319
00:31:35,867 --> 00:31:37,867
It is technically possible.

320
00:31:37,867 --> 00:31:41,867
The problem comes when things turn a little bit out of Xaria.

321
00:31:41,867 --> 00:31:50,867
So it's always when that minimum amount of trust into cooperation and well-behavior, right, falls apart.

322
00:31:50,867 --> 00:31:59,867
And you are going to, you are arriving to the point where you have to enforce your property rights on Layer 1 mainchain.

323
00:31:59,867 --> 00:32:01,867
And that is where the problems start.

324
00:32:01,867 --> 00:32:07,867
Because in a high-fee environment, you have this thing called the dust limit.

325
00:32:08,867 --> 00:32:14,867
And even if you didn't have the dust limit, you would still just pay the transaction value in fees.

326
00:32:14,867 --> 00:32:22,867
So it's almost like pointless to have below-dust transaction outputs.

327
00:32:22,867 --> 00:32:25,867
Even if you could somehow push them on-chain, it's pointless.

328
00:32:25,867 --> 00:32:31,867
It's basically dust and unspendable.

329
00:32:31,867 --> 00:32:47,867
And so the worst-case scenario, creating a lot of dust or just not being able to afford to push your VTXOs, your tokens of property rights on-chain,

330
00:32:47,867 --> 00:32:57,867
if you are not able to enforce these on-chain in a high-fee and adversarial situation, then is that really self-custody, right?

331
00:32:58,867 --> 00:33:08,867
So how trustless that protocol is, it is more similar to how Lightning operates with below-dust payments,

332
00:33:08,867 --> 00:33:21,867
where instead of HTLCs, which couldn't be enforceable on-chain, the parties basically agree to pay that difference to the miners instead.

333
00:33:21,867 --> 00:33:29,867
And something like this you can do with R2, so you can have a situation where nobody is really interested in pushing these to on-chain,

334
00:33:29,867 --> 00:33:31,867
because everyone would just lose with it.

335
00:33:31,867 --> 00:33:35,867
So it's a lose-lose situation, only the miners would be happy with it.

336
00:33:36,867 --> 00:33:41,867
And that's the best we can do with these amounts.

337
00:33:41,867 --> 00:33:51,867
But if someone is a little bit bullish on Bitcoin, and you assume that, as we've seen, 30,000 and 50,000 Satoshi transaction fees,

338
00:33:51,867 --> 00:33:58,867
they don't seem like an impossible thing for me in a high adoption future.

339
00:33:58,867 --> 00:34:04,867
And if you assume sub-dollar parity in the future, let's say 10 years from now or something like that,

340
00:34:04,867 --> 00:34:08,867
again, that doesn't sound impossible to me.

341
00:34:08,867 --> 00:34:21,867
And that means that you would pay more in on-chain fees for a single VTXO than what is the life-saving of an entire person on average.

342
00:34:21,867 --> 00:34:27,867
And that's just not viable at that point. It's just not working, it's not viable.

343
00:34:28,867 --> 00:34:38,867
So while it might make sense from one approach, and like I said on the happy part, it just works perfectly,

344
00:34:38,867 --> 00:34:45,867
it is not a completely trustless system under certain circumstances and assumptions.

345
00:34:45,867 --> 00:34:54,867
And you don't really have that assurance that you can actually get your money out of it if things continue as they have been.

346
00:34:54,867 --> 00:34:59,867
But it's still a hell of a lot better than being in straight-up custody.

347
00:34:59,867 --> 00:35:08,867
So I could probably talk about why I like ORC and what are the advantages compared to custodial relationships for like an hour.

348
00:35:08,867 --> 00:35:11,867
I don't want to bore people with it here, but not really.

349
00:35:11,867 --> 00:35:19,867
So fractional reserve banking, and like I said, at least your savings may be enforceable on-chain,

350
00:35:19,867 --> 00:35:26,867
again depending on the fee rate and exchange rate and your holdings.

351
00:35:26,867 --> 00:35:32,867
So I think it's a huge thing. If we can do ORC, we should definitely do it.

352
00:35:32,867 --> 00:35:41,867
But if we can do ORC on main-chain in the future, in the high adoption future, that is more up for debate.

353
00:35:42,867 --> 00:35:50,867
And as I have seen in the Telegram group chat, other people are having doubts about this too.

354
00:35:53,867 --> 00:36:06,867
Yes, we plan on making a sidechain that is just Bitcoin Core version 25, and then we just add all of them, 118, 119, OP_VAULT,

355
00:36:07,867 --> 00:36:11,867
and then it will be pretty fun for people to play with.

356
00:36:11,867 --> 00:36:18,867
Yeah, I asked Henry, I think like a few weeks ago, I asked Henry if you are planning to do that,

357
00:36:18,867 --> 00:36:23,867
and I told him that you really should consider it, and I'm happy to hear that.

358
00:36:23,867 --> 00:36:29,867
Because that is going to make life a hell of a lot more easy, I believe.

359
00:36:30,867 --> 00:36:41,867
And I have speculated before that you could even, probably in the interim period, use ORC in a way where the on-chain,

360
00:36:41,867 --> 00:36:54,867
the near and below dust amounts, near and below dust amount VTXOs are actually on a sidechain where they are still enforceable unilaterally.

361
00:36:54,867 --> 00:37:03,867
And your large amounts, your holdings that you really want to secure may be on mainchain,

362
00:37:03,867 --> 00:37:11,867
so this should not be completely impossible, especially if the sidechain has good covenant capability.

363
00:37:11,867 --> 00:37:21,867
Then atomic swaps are possible between mainchain and the sidechain, and you would need a minimal overlap on the denominations.

364
00:37:22,867 --> 00:37:29,867
Probably, because you can't really do the take-slop mechanism that ORC relies on between chains,

365
00:37:29,867 --> 00:37:38,867
at least I'm not aware that you could do between chains, but maybe someone will figure it out, I don't know.

366
00:37:40,867 --> 00:37:48,867
I think that only works on a single chain, but if you could, with a minimal overlap on the VTXO denominations,

367
00:37:48,867 --> 00:37:54,867
have some atomic swap between chains, then your wallet could take care of this in the background.

368
00:37:54,867 --> 00:38:07,867
Like, if you need more change, then it can just swap a larger denomination build to a sidechain and break it up there trustlessly once it's all settled.

369
00:38:07,867 --> 00:38:15,867
So this should be possible, almost with the existing contractual capability with the simple primitives that we have.

370
00:38:15,867 --> 00:38:18,867
And that is a very different ballgame, I believe.

371
00:38:18,867 --> 00:38:27,867
So if you can actually enforce your holdings somewhere, and you have reasonably decentralized sidechains,

372
00:38:27,867 --> 00:38:34,867
and you are not actually directly exposed to that, so you are basically having a relationship with the ASP,

373
00:38:34,867 --> 00:38:41,867
and you are only having a relationship with the sidechain operators, if there are operators,

374
00:38:42,867 --> 00:38:52,867
in which case it's a Bitcoin miners, you are only having a direct relationship with them if you are having a unilateral settlement scenario.

375
00:38:52,867 --> 00:38:59,867
And I think this would be an interesting concept to explore, and it could actually work at scale,

376
00:38:59,867 --> 00:39:07,867
and get people as close to holding their own keys with minimal on-chain footprint as we can probably get.

377
00:39:08,867 --> 00:39:23,867
Moonsettler, is your main concern regarding drivechains the possibility that they would be only as secure as they have consistently high fees?

378
00:39:23,867 --> 00:39:25,867
Is that your main concern?

379
00:39:29,843 --> 00:39:43,843
So my main concern with it is that they would grow too fast, and basically be giant honeypots that are actually economic to attack,

380
00:39:43,843 --> 00:39:58,843
and not really have nor the security budget, nor the widespread consensus, you know, the ecosystem and the users to naturally defend them.

381
00:39:58,843 --> 00:40:09,843
So I have this idea or theory that the humans would naturally agree on property rights, we would naturally agree on that stealing is bad,

382
00:40:09,843 --> 00:40:21,843
and once this thing is sufficiently mature, it would be unthinkable for miners to try to steal from the drivechain escrow.

383
00:40:21,843 --> 00:40:34,843
But like I said, if this pot grows too fast, and the whole thing does not mature, the whole understanding and everything does not mature with it,

384
00:40:34,843 --> 00:40:45,843
then we can get into nasty situations that can even lead to, you know, a new fork war, a nasty chain split, maybe a series of chain splits, chaos.

385
00:40:45,843 --> 00:41:01,843
People don't really like the idea that Bitcoin would have people's voice heard and moral considerations in selecting the next value block.

386
00:41:01,843 --> 00:41:07,843
A lot of people don't like that they want this thing to be pure and based on thermodynamics.

387
00:41:07,843 --> 00:41:16,843
I think it already is not true. So we are not having a chain with the largest amount of cumulative hash power.

388
00:41:16,843 --> 00:41:24,843
We are having a chain with the heaviest chain rule is applied within the validity of the rule set.

389
00:41:24,843 --> 00:41:31,843
So we already have a social consensus on a rule set, and we are free to change that consensus on the rule set.

390
00:41:31,843 --> 00:41:34,843
We are not bound to it forever, in my thinking.

391
00:41:34,843 --> 00:41:47,843
And so it is already not true that it is some objective truth, and if 60% of the miners would start mining a hard fork that nobody cares for,

392
00:41:47,843 --> 00:41:56,843
we could so easily ignore them. We could actually just thank them for mining a hard fork and make it easy for us to ignore them.

393
00:41:57,843 --> 00:42:03,843
So that's kind of how Bitcoin works. They would not automatically win that game.

394
00:42:03,843 --> 00:42:06,843
They would probably have to give up because they would not get paid.

395
00:42:06,843 --> 00:42:19,843
So we kind of decide which chain we value and who we pay, and this relationship is always asymmetric to the soft fork side.

396
00:42:20,843 --> 00:42:27,843
And that is how I generally think about this.

397
00:42:27,843 --> 00:42:38,843
And I think this whole thing could work, but it would have to grow slowly, and it would have to go through the steps and take the time.

398
00:42:39,843 --> 00:42:50,843
I said it before, I think it would take like a decade for drivechains to really accomplish some of what we are talking about,

399
00:42:50,843 --> 00:43:01,843
to really have a significant role in getting fee revenue for the mainchain miners, to actually help scale Bitcoin with block space and stuff like that.

400
00:43:02,843 --> 00:43:12,843
And I'm a bit afraid that people would rush ahead and lock too much value into it before it's actually ready for that role,

401
00:43:12,843 --> 00:43:20,843
before the whole thing grows up, before Bitcoin mining actually becomes unstoppable and stuff like that.

402
00:43:20,843 --> 00:43:25,843
So that's my main worry, that basically people would rush ahead.

403
00:43:26,843 --> 00:43:28,843
Yeah, I kind of worry about that too.

404
00:43:28,843 --> 00:43:33,843
I mean, what I had in mind when I wrote it was that it wouldn't be controversial at all,

405
00:43:33,843 --> 00:43:41,843
and that the large blockers and small blockers would both see it as the solution to the scaling dispute,

406
00:43:41,843 --> 00:43:48,843
and so that there would be this very full understanding, like everyone would get the idea,

407
00:43:49,843 --> 00:43:57,843
and so everyone would know, okay, this is the risk you're taking when you deposit funds into this hashrate escrow.

408
00:43:57,843 --> 00:44:03,843
They may be stolen, but also the idea that on the flip side, because it has many layers,

409
00:44:03,843 --> 00:44:07,843
it was like one layer was they may be stolen, but the second layer is, as you say,

410
00:44:07,843 --> 00:44:17,843
everyone would recognize that in the event of a dispute, it's perfectly easy for people who would not normally run the sidechain node software.

411
00:44:17,843 --> 00:44:23,843
They could run it and just find that only one side of the dispute was right,

412
00:44:23,843 --> 00:44:27,843
and so that's just, to me, that seemed like an awful lot of firepower on the one side,

413
00:44:27,843 --> 00:44:32,843
such that they would kind of basically never lose, and then the onion has even more layers,

414
00:44:32,843 --> 00:44:38,843
because it's kind of like if they never lose, isn't that just what I said was the bad thing earlier,

415
00:44:38,843 --> 00:44:43,843
where now it's become part of layer one consensus?

416
00:44:44,843 --> 00:44:46,843
And the answer is no, it's not the same.

417
00:44:46,843 --> 00:44:57,843
Because you could choose not to at any time, check the layer two rules,

418
00:44:57,843 --> 00:45:02,843
and what's coming back on layer one is just this extreme simplification of it,

419
00:45:02,843 --> 00:45:06,843
this sterilization of it into just one hash every three months.

420
00:45:06,843 --> 00:45:12,843
So that's the only thing that's coming back, and it's not mandatory for everyone all the time.

421
00:45:12,843 --> 00:45:21,843
You can just go on vacation for a year and let other people do those four withdrawals for that year,

422
00:45:21,843 --> 00:45:28,843
and then you come back, and then you can be like, oh, yeah, I guess people are still trying to steal from the hashrate escrows.

423
00:45:28,843 --> 00:45:35,843
So I kind of thought, but to your point, it kind of relied a lot on everyone understanding what all the pieces were doing and why,

424
00:45:35,843 --> 00:45:38,843
which now seems somewhat disastrous.

425
00:45:38,843 --> 00:45:47,843
People are so confused about why this idea is being pursued and what it's for,

426
00:45:47,843 --> 00:45:56,843
and people think that it's for adding shit coins to Bitcoin, which is the opposite of what it's for.

427
00:45:56,843 --> 00:45:59,843
What a tragedy.

428
00:46:00,843 --> 00:46:07,843
Yeah, well, a lot of people, I don't want to spend too much time on this,

429
00:46:07,843 --> 00:46:15,843
but there is this line of worrying that I can't actually debunk, really,

430
00:46:15,843 --> 00:46:23,843
that you are going to have EVM chains and stuff like that run as sidechains,

431
00:46:23,843 --> 00:46:30,843
and they don't have the same UTXO ordering UTXO chains have,

432
00:46:30,843 --> 00:46:36,843
and you are going to have sandwichable transactions, and the miners will start to extract value,

433
00:46:36,843 --> 00:46:42,843
and you will have this situation where it's possible that the worst case,

434
00:46:42,843 --> 00:46:46,843
because some people say miners will centralize, like mining pools.

435
00:46:46,843 --> 00:46:49,843
I don't think that is a huge problem.

436
00:46:49,843 --> 00:46:58,843
Like, mining pools actually running this algo, and miners being able to leave them,

437
00:46:58,843 --> 00:47:05,843
and Stratum V2 gaining dominance, hopefully in the future, and stuff like that.

438
00:47:05,843 --> 00:47:07,843
So, I don't think that is a huge problem.

439
00:47:07,843 --> 00:47:19,843
I think people are more afraid of a different specialization centralizing the sidechain block validation,

440
00:47:19,843 --> 00:47:27,843
because if there is a quant firm that can extract the most value from the sidechains,

441
00:47:27,843 --> 00:47:35,843
and, of course, they can bribe the miners to always, or maybe they can even do more

442
00:47:35,843 --> 00:47:41,843
things like they demand direct lines and skipping the mempool,

443
00:47:41,843 --> 00:47:47,843
and have special deals with mining pools, and the whole thing becomes,

444
00:47:47,843 --> 00:47:52,843
instead of being out in the open and open fee bidding and auction,

445
00:47:52,843 --> 00:47:56,843
it's a small group would gain a lot of control over the Bitcoin ecosystem.

446
00:47:56,843 --> 00:48:00,843
I think this is the line where a lot of people have worries,

447
00:48:00,843 --> 00:48:08,843
that if we can have anything, like literally anything, as blind merge mining attached to Bitcoin,

448
00:48:08,843 --> 00:48:13,843
and there is a significant value and economic activity locked into it,

449
00:48:13,843 --> 00:48:16,843
then we can't really predict the consequences,

450
00:48:16,843 --> 00:48:21,843
but we are seeing on Ethereum kind of where it can go worst case.

451
00:48:22,843 --> 00:48:28,843
And that is something that I would also consider.

452
00:48:28,843 --> 00:48:34,843
So if it was up to me, I would very much prefer if we only had UTXO sidechains,

453
00:48:34,843 --> 00:48:37,843
and basically Bitcoin clones mostly.

454
00:48:37,843 --> 00:48:40,843
Well, you know, I actually have a couple thoughts on that.

455
00:48:40,843 --> 00:48:48,843
One is, first of all, it's already possible to have merge-mined altcoin that has EVM and not UTXO,

456
00:48:49,843 --> 00:48:53,843
which honestly kind of should be enough to just get rid of that whole argument,

457
00:48:53,843 --> 00:48:56,843
because it doesn't have anything to do with sidechains per se,

458
00:48:56,843 --> 00:48:59,843
even though you could say something like,

459
00:48:59,843 --> 00:49:03,843
merge-mined altcoin is so unviable that it will never have any effect on anything,

460
00:49:03,843 --> 00:49:05,843
and so we don't even need to think about that.

461
00:49:05,843 --> 00:49:11,843
But another thing to think about is that, in my view,

462
00:49:11,843 --> 00:49:17,843
all this Ethereum DeFi stuff is actually really, really, really small.

463
00:49:17,843 --> 00:49:19,843
It's like unbelievably small.

464
00:49:19,843 --> 00:49:23,843
It's currently 15 to 20 times larger than Bitcoin, BTC,

465
00:49:23,843 --> 00:49:28,843
but that is only because of just the current state of things in Bitcoin.

466
00:49:28,843 --> 00:49:33,843
The Bitcoin's aspiration is to just replace every transaction in the world,

467
00:49:33,843 --> 00:49:38,843
all the coffee transactions, everything, every time you buy a shirt,

468
00:49:38,843 --> 00:49:41,843
when you buy a chicken sandwich.

469
00:49:42,843 --> 00:49:49,843
There's just so much in the real world of payments that whatever is done in DeFi,

470
00:49:49,843 --> 00:49:53,843
I don't even think it will be very big,

471
00:49:53,843 --> 00:49:59,843
and I think actually the stuff that people like, it has nothing to do.

472
00:49:59,843 --> 00:50:02,843
It would be better served by the UTXO model.

473
00:50:02,843 --> 00:50:09,843
The stuff that people like about Ethereum is not any kind of complicated programmability at all.

474
00:50:09,843 --> 00:50:13,843
What they want is to be able to basically do what Counterparty did or colored coins.

475
00:50:13,843 --> 00:50:15,843
They want to be able to issue their own token.

476
00:50:15,843 --> 00:50:21,843
They want to issue Moon Settler coin, which we can easily do with the UTXO chain

477
00:50:21,843 --> 00:50:25,843
and which would actually be much better because, as you know, in Ethereum,

478
00:50:25,843 --> 00:50:30,843
oftentimes you pay the fee and you don't even get what you wanted to get.

479
00:50:30,843 --> 00:50:33,843
You have to pay the fee for the option of maybe.

480
00:50:34,843 --> 00:50:39,843
The very fact that there's miner extractable value proves that there's a wedge being driven

481
00:50:39,843 --> 00:50:43,843
between the buyer and the seller that is extracted by miners,

482
00:50:43,843 --> 00:50:45,843
and that just proves that it's inefficient.

483
00:50:45,843 --> 00:50:50,843
And so if someone rewrote, we have a primitive version of this right now,

484
00:50:50,843 --> 00:50:54,843
the asset sidechain, where it's just UTXOs for assets,

485
00:50:54,843 --> 00:50:59,843
and it's really assets is like 90% of what people like about Ethereum and DeFi.

486
00:50:59,843 --> 00:51:02,843
Do people actually like the term completeness?

487
00:51:02,843 --> 00:51:03,843
Not really.

488
00:51:03,843 --> 00:51:06,843
So that's my multi-part response to that.

489
00:51:06,843 --> 00:51:08,843
What do you think of those points?

490
00:51:08,843 --> 00:51:18,843
Yeah, I think it's absolutely possible to write a decentralized exchange on the UTXO chain,

491
00:51:18,843 --> 00:51:26,843
and I do believe that it would probably, it should win over the EVM approach.

492
00:51:26,843 --> 00:51:33,843
And that requires a more comprehensive set of governance.

493
00:51:33,843 --> 00:51:43,843
So I'm not sure if you've seen what Burak did on Liquid, Liquid with the elements opcodes.

494
00:51:43,843 --> 00:51:53,843
He actually managed to create a peer-to-peer driven exchange contract

495
00:51:54,843 --> 00:52:02,843
where you can bid for an operation, and you can set your spread tolerance,

496
00:52:02,843 --> 00:52:10,843
and multiple people can get into a round, and it would execute and enforce the rules on chain.

497
00:52:10,843 --> 00:52:15,843
So it was pretty magical what you can do with this stuff.

498
00:52:15,843 --> 00:52:20,843
If you have a native representation of tokens, like on Liquid,

499
00:52:20,843 --> 00:52:26,843
and you have these opcodes where you can dig into the transactions.

500
00:52:26,843 --> 00:52:32,843
And so it's clear that UTXO chains can do these things.

501
00:52:32,843 --> 00:52:34,843
It's pretty clear to me.

502
00:52:34,843 --> 00:52:39,843
And probably going to offer advantages over EVM.

503
00:52:40,843 --> 00:52:45,843
And probably the contracts will be more auditable.

504
00:52:45,843 --> 00:52:51,843
The whole thing, I think, will be more performant.

505
00:52:51,843 --> 00:52:53,843
That's my personal opinion.

506
00:52:53,843 --> 00:52:56,843
Of course, I could be proven wrong on this.

507
00:52:56,843 --> 00:53:04,843
And I think we should probably not be close-minded for this possibility.

508
00:53:04,843 --> 00:53:06,843
What do you think, Paul, about the statement?

509
00:53:06,843 --> 00:53:14,843
I think Roccat said this to me, that payments, that Bitcoin aspires to take over,

510
00:53:14,843 --> 00:53:17,843
that payments are just peanuts compared to finance.

511
00:53:17,843 --> 00:53:24,843
So actually, if you take all the payments, like credit cards and other payments in the world,

512
00:53:24,843 --> 00:53:28,843
it would be nothing compared to finance.

513
00:53:29,843 --> 00:53:36,843
And these difference in aspirations that Bitcoin has had and what is out there in the world to take

514
00:53:36,843 --> 00:53:40,843
fundamentally actually do Bitcoin, in his view.

515
00:53:43,843 --> 00:53:47,843
Well, that's an interesting type of a question because it's really an empirical question.

516
00:53:47,843 --> 00:53:52,843
And I think what's intriguing about it is, first of all, we could just look it up.

517
00:53:52,843 --> 00:53:56,843
But second of all, think about it.

518
00:53:56,843 --> 00:53:59,843
What would it mean if it were wrong?

519
00:53:59,843 --> 00:54:00,843
Would it actually change anything?

520
00:54:00,843 --> 00:54:04,843
Because imagine that finance were smaller than payments.

521
00:54:04,843 --> 00:54:10,843
Well, in three years, one could grow and the other could shrink and then it could reverse

522
00:54:10,843 --> 00:54:12,843
and then it could reverse again.

523
00:54:12,843 --> 00:54:17,843
And so it seems to me nothing can really hinge on whether or not that statement is true.

524
00:54:17,843 --> 00:54:22,843
It happens to be a straightforward empirical statement that we can simply look up.

525
00:54:22,843 --> 00:54:28,843
Certainly, there are many ways in which a financial transaction is not really different

526
00:54:28,843 --> 00:54:31,843
from a regular payment for something.

527
00:54:31,843 --> 00:54:37,843
If you buy something, you want a hamburger, then you buy a hamburger.

528
00:54:37,843 --> 00:54:42,843
If you want to buy car insurance, you buy car insurance.

529
00:54:43,843 --> 00:54:50,843
If you want to buy a house, it's partly land, it's partly house, it's partly homeowners insurance.

530
00:54:50,843 --> 00:54:52,843
What difference does it really make?

531
00:54:52,843 --> 00:54:53,843
But yeah, we could look that up.

532
00:54:53,843 --> 00:54:59,843
I mean, sometimes, though, I do think people, they don't actually understand.

533
00:54:59,843 --> 00:55:01,843
They don't do the accounting quite right, but maybe they do.

534
00:55:01,843 --> 00:55:02,843
I don't know.

535
00:55:02,843 --> 00:55:08,843
But I think they sometimes think they use numbers about like, they can play like stock to flow,

536
00:55:08,843 --> 00:55:11,843
like the market cap to the volume.

537
00:55:11,843 --> 00:55:17,843
And then it's like, if you buy a stock for $5, are you really buying, is it a $5 trade?

538
00:55:17,843 --> 00:55:22,843
Or is it just the marginal value of you exchanging cash, $5 worth of cash?

539
00:55:22,843 --> 00:55:29,843
To swap a $5 worth of cash, $5 worth of stock, what is the actual value of that transaction?

540
00:55:29,843 --> 00:55:32,843
I may have quoted that statement wrongly.

541
00:55:33,843 --> 00:55:44,843
I think the real point that was made was about the profit margin of these operations.

542
00:55:44,843 --> 00:55:52,843
So that payments tend to, you know, towards the marginal cost.

543
00:55:52,843 --> 00:55:59,843
And it's not a huge business compared to anything related to lending and finance.

544
00:55:59,843 --> 00:56:04,843
I think it's more accurate to represent this point like that.

545
00:56:04,843 --> 00:56:14,843
And that involves the miner revenue that can be extracted from, you know, the payments use case versus the finance use case.

546
00:56:14,843 --> 00:56:23,843
Well, my guess is just, you know, basic economics type of idea would be that if it's really true that there is a lot of, you know,

547
00:56:24,843 --> 00:56:26,843
and I agree with this.

548
00:56:26,843 --> 00:56:33,843
See, if someone is buying and selling a hamburger, then people are cutting the profit margins because of the low barriers to entry.

549
00:56:33,843 --> 00:56:42,843
It's not that hard for you to go to the supermarket, buy the inputs, go to Home Depot and buy a stove,

550
00:56:42,843 --> 00:56:47,843
and start turning the inputs into a hamburger.

551
00:56:47,843 --> 00:56:49,843
So that's not that hard.

552
00:56:49,843 --> 00:56:51,843
And so that's competitive.

553
00:56:51,843 --> 00:56:57,843
Whereas for people to offer financial services is not as easy.

554
00:56:57,843 --> 00:57:06,843
The idea being if it's true that there's lots of profits in that industry, it's only because the barriers to entry are high.

555
00:57:06,843 --> 00:57:16,843
And in fact, part of what we would be doing by creating the BitAsset sidechain, by creating open financial, open source software,

556
00:57:16,843 --> 00:57:22,843
we would be the people who would be causing the barriers to entry to plummet.

557
00:57:22,843 --> 00:57:27,843
And then we would be killing the profit margin, basically.

558
00:57:27,843 --> 00:57:31,843
It's like my reaction to that question.

559
00:57:35,843 --> 00:57:36,843
Yeah, interesting.

560
00:57:36,843 --> 00:57:44,843
So I guess one could, I think, ask the question if we can afford to simplify out.

561
00:57:44,843 --> 00:57:47,843
And I'm undecided on that.

562
00:57:47,843 --> 00:57:55,843
So a lot of people just immediately start enumerating the scams in the DeFi space if it comes up.

563
00:57:55,843 --> 00:58:07,843
But on the other hand, this could actually grow up to be in a future where, let's say, Bitcoin does take over in some sense.

564
00:58:07,843 --> 00:58:11,843
And it would not be just scams.

565
00:58:12,843 --> 00:58:18,843
Can we really just sit on our hands and not work towards the future?

566
00:58:18,843 --> 00:58:21,843
I guess that's a question that is worth considering.

567
00:58:23,843 --> 00:58:31,843
You and I would agree that mostly what is out there is scams, like 99 percent or whatever.

568
00:58:32,843 --> 00:58:45,843
Again, though, it's kind of frustrating because this entire trajectory is because the lack of sidechains has both provided enormous cover to scams.

569
00:58:45,843 --> 00:58:50,843
It has also shut down many people's Bitcoin aspirations.

570
00:58:50,843 --> 00:58:58,843
People who would have been in Bitcoin and created a legitimate business found that way blocked, basically,

571
00:58:58,843 --> 00:59:07,843
because the lack of sidechains closed down multiple different complete industries that could have opened up and really derailed, honestly,

572
00:59:07,843 --> 00:59:14,843
the total growth of Bitcoin that would have affected everything from the exchanges to the miners where people had different ideas.

573
00:59:14,843 --> 00:59:17,843
They were enthusiastic about different things.

574
00:59:17,843 --> 00:59:30,843
Or even if they're enthusiastic about something like just general research or just kind of activism, like writing open source software for simple tools.

575
00:59:31,260 --> 00:59:39,580
All of that would have been on a different path if we had had sidechains, which would have just like we would have been able to grow in an unlimited sense.

576
00:59:39,580 --> 00:59:55,100
But also the lack of sidechains created this entire confusing food chain of just like what you had was just one thing after another, where it was like there was no Ethereum before the block size war kind of created Ethereum.

577
00:59:55,660 --> 00:59:59,660
Whereas it didn't really break into the scene until people smelled blood.

578
00:59:59,660 --> 01:00:02,219
They smelled like the Bitcoin community was like disunited.

579
01:00:03,180 --> 01:00:08,219
The Ethereum community knew that they had to be more experimental and tolerant of weird ideas.

580
01:00:08,379 --> 01:00:09,980
They were a new weird idea.

581
01:00:11,580 --> 01:00:19,820
They had people creating all these tokens, many of which were versions of things that had been proposed, probably almost all of which.

582
01:00:20,620 --> 01:00:31,340
There's probably nothing you could find in Ethereum from 2015 to 2017 that wasn't previously proposed on Counterparty or as some kind of weird Bitcoin mod on Bitcoin Talk.

583
01:00:32,059 --> 01:00:34,059
So then you have now you have the alt versions.

584
01:00:34,059 --> 01:00:41,179
And as a result, people are forced to become a little bit more what you might call open minded to new tokens, because now here's Ethereum is a thing.

585
01:00:41,899 --> 01:00:45,740
These all these ICOs and things are things you got ICOs.

586
01:00:45,740 --> 01:00:48,539
And then you have all these people with a vested interest.

587
01:00:48,940 --> 01:00:51,099
We could name some funny names if we wanted to.

588
01:00:52,060 --> 01:00:55,819
You know, this stuff about like fortunes were being made.

589
01:00:56,779 --> 01:01:02,139
You know, that guy, William Guyar, the business blockchain guy, stuff like that.

590
01:01:02,139 --> 01:01:06,380
Just the whole the whole derailment into like the blockchain without Bitcoin thing.

591
01:01:07,099 --> 01:01:15,020
ICOs, all of that just created people with a huge vested interest in continuing to basically scam.

592
01:01:15,020 --> 01:01:16,620
So I'm saying the scam is ironic.

593
01:01:16,700 --> 01:01:18,700
I think the blockchain would have solved this problem.

594
01:01:18,700 --> 01:01:20,060
Welcome, Ryan Dye.

595
01:01:20,060 --> 01:01:21,179
Thanks for joining.

596
01:01:21,179 --> 01:01:21,899
Please chime in.

597
01:01:23,179 --> 01:01:26,219
Actually, Paul, I have a question for you on exactly that point.

598
01:01:26,219 --> 01:01:37,580
Like, I tend to agree, I think, you know, one of the sad things about Bitcoin's history is the amount of kind of PTSD around changing Bitcoin.

599
01:01:38,139 --> 01:01:43,659
Like, I think, you know, it was kind of Bitcoin's game to lose.

600
01:01:43,659 --> 01:01:56,220
And in a lot of ways, like the PTSD out of the block size debacle, I think in a lot of ways, kind of kneecapped the Bitcoin community's ability to adapt to changing market circumstances.

601
01:01:56,780 --> 01:02:09,980
And like, there's this idea that I've subscribed to around sidechains or roll ups or whatever that, you know, if we had it on Bitcoin, it would be better.

602
01:02:10,539 --> 01:02:25,179
And if you, you know, used Bitcoin as the unit of account for like paying for transaction fees on sidechains or whatever other layer twos like that would be better because Bitcoin has like superior monetary and kind of governance properties.

603
01:02:25,659 --> 01:02:30,459
But something I've been thinking about a lot lately is I really wonder if it's just too late.

604
01:02:30,459 --> 01:02:45,899
And if we're in a point now where let's say tomorrow you could like wave a magic wand and we activated BIP300 and 301 and we got, you know, blind merge mine, hash rate, escrow, sidechains, we got drivechains.

605
01:02:46,459 --> 01:02:52,539
It seems like the first thing that somebody would do, or maybe not the first, maybe the second thing, right?

606
01:02:52,539 --> 01:02:59,019
Because I'm sure the first thing is that you've got a prediction market like in the chamber and we're going to go do that and it'll be awesome.

607
01:02:59,260 --> 01:03:07,580
But maybe the second thing that we're going to do is somebody is going to make a better version of wrapped Bitcoin of like WBTC, right?

608
01:03:07,580 --> 01:03:19,420
Because like there's way more Bitcoin in a custodial wrapped Bitcoin deployed on Ethereum than there is in Liquid and Lightning combined.

609
01:03:19,980 --> 01:03:33,500
And so, you know, if somebody could say, all right, there's already a wallet ecosystem, there's already all these dApps, DAOs, like all these different products over in the Ethereum ecosystem.

610
01:03:34,060 --> 01:03:41,739
And it would be really great if we could reduce the trust needed in wrapping Bitcoin and going and using that ecosystem.

611
01:03:42,220 --> 01:03:47,179
Like that would be an incredibly high leverage way of using drivechains, right?

612
01:03:47,179 --> 01:03:53,099
Like you basically just make a drivechain to wrap Bitcoin and deploy it on Ethereum.

613
01:03:53,099 --> 01:03:59,580
And that gets you kind of all of the Ethereum ecosystem and all the crazy Web3 DeFi bullshit that people want to do.

614
01:03:59,580 --> 01:04:02,059
Like you just get that on day one.

615
01:04:02,539 --> 01:04:06,619
And if we do that, then maybe we only end up with like two drivechains, right?

616
01:04:06,619 --> 01:04:15,740
There's like a drivechain to do wrapped Bitcoin and there's a drivechain to do kind of, you know, hive mind prediction markets.

617
01:04:16,219 --> 01:04:17,099
And that's kind of it.

618
01:04:17,099 --> 01:04:23,819
And like there ends up not being a whole lot of demand for other interesting Bitcoin sidechains.

619
01:04:23,819 --> 01:04:28,059
Because if you want to do like Bitcoin things, you do that on Bitcoin.

620
01:04:28,059 --> 01:04:32,059
And if you want to do other stuff, then do that on Ethereum with like a less trusted peg.

621
01:04:32,779 --> 01:04:33,819
Like, does that make sense?

622
01:04:33,819 --> 01:04:35,819
Or am I talking crazy?

623
01:04:36,700 --> 01:04:41,020
There's a lot of different thoughts all wrapped in there.

624
01:04:41,020 --> 01:04:46,379
I think it's certainly true that some people like network effects are big, but also features are big.

625
01:04:46,379 --> 01:04:51,819
And this is a tug of war game that we all have to play.

626
01:04:51,819 --> 01:04:57,580
Because if you think network effects will always win, then the US dollar is going to defeat Bitcoin.

627
01:04:57,580 --> 01:04:59,180
So you just give up.

628
01:04:59,180 --> 01:05:02,939
And if you think that features will always win, then you're not correct.

629
01:05:02,939 --> 01:05:06,140
Because network effects matter a lot.

630
01:05:06,700 --> 01:05:13,659
So it's definitely the case that Ethereum's state has its own very strong network effect at this point.

631
01:05:13,659 --> 01:05:17,180
Where even if you could replicate, you replicate the EVM completely,

632
01:05:17,980 --> 01:05:23,659
then people want to be on the EVM chain that their other stuff is on.

633
01:05:23,659 --> 01:05:24,619
So that's also true.

634
01:05:26,619 --> 01:05:28,779
The question of whether or not it would be wrapped.

635
01:05:30,140 --> 01:05:34,700
First of all, I think it's a little pessimistic to say people would only use it in such and such ways.

636
01:05:34,700 --> 01:05:38,379
You know, if there's demand, then people would use it.

637
01:05:38,379 --> 01:05:39,420
There may not be demand.

638
01:05:39,980 --> 01:05:47,980
But the idea of like, is it like wrapped BTC in the Bitcoin drivechain versus on Ethereum?

639
01:05:49,580 --> 01:05:53,499
This is also something where there's lots of intersecting points where I would say that like,

640
01:05:54,539 --> 01:06:01,339
custodial, we should do everything we can to sort of fight against custodial Bitcoin

641
01:06:01,339 --> 01:06:03,499
by offering a good product or service.

642
01:06:04,779 --> 01:06:05,580
That people like.

643
01:06:06,460 --> 01:06:12,860
But we also have to accept that the custodial thing is going to have lots of advantages for many people

644
01:06:13,659 --> 01:06:16,539
over the cypherpunky thing.

645
01:06:16,539 --> 01:06:22,539
And there's just most people are not going to be going for the cypherpunky thing at the end of the day.

646
01:06:22,539 --> 01:06:27,740
So it shouldn't really be surprising that when you compare liquid to wrapped Bitcoin.

647
01:06:28,379 --> 01:06:35,180
And I would imagine that it's quite possible that some kind of custodial thing,

648
01:06:35,740 --> 01:06:41,980
whether it's all in one UTXO on layer one or in a weird drivechain,

649
01:06:42,939 --> 01:06:45,420
will be, I think that is real.

650
01:06:47,740 --> 01:06:53,420
I think that the way to win is to try to give as many people what they want as possible

651
01:06:53,420 --> 01:06:55,180
so that you have the biggest network effect.

652
01:06:55,819 --> 01:07:02,300
And so what we want is for the people who wanted large blocks to get their large blocks.

653
01:07:02,300 --> 01:07:05,099
The people who wanted small blocks to get their small blocks.

654
01:07:05,099 --> 01:07:08,539
The people who wanted zk-SNARK, super privacy to get that.

655
01:07:09,339 --> 01:07:13,740
The people who didn't want it because it interferes with the audibility of the 21 million coin limit.

656
01:07:13,740 --> 01:07:15,099
They should not have it.

657
01:07:16,300 --> 01:07:19,020
The people who wanted namecoin stuff should get namecoin stuff.

658
01:07:19,020 --> 01:07:20,059
Other people should not.

659
01:07:20,059 --> 01:07:23,020
People want assets, ordinals, they should get it.

660
01:07:23,099 --> 01:07:26,539
So now, of course, we can never do this quite perfectly.

661
01:07:26,539 --> 01:07:30,700
But what we currently do is a very, very shameful thing

662
01:07:30,700 --> 01:07:35,260
where we just have one piece of software that changes very slowly.

663
01:07:35,260 --> 01:07:39,980
We shame anyone who doesn't use that.

664
01:07:39,980 --> 01:07:41,659
You know, we say if someone uses something else,

665
01:07:42,539 --> 01:07:44,619
not only are they wrong, but they're a bad person

666
01:07:44,619 --> 01:07:46,379
and they're misleading their friends and family.

667
01:07:47,499 --> 01:07:51,819
So we don't do a very good job now of being kind of like customer is always right.

668
01:07:53,180 --> 01:07:55,980
This is what I wanted to interject.

669
01:07:55,980 --> 01:07:59,499
Just a little thing, a small thing that I have noticed.

670
01:08:02,059 --> 01:08:05,660
Someone is having an idea, something that would be cool,

671
01:08:05,660 --> 01:08:08,859
something that would be nice, something that some people would want.

672
01:08:08,859 --> 01:08:14,140
And the Bitcoin moxes say, fuck off, make a shitcoin.

673
01:08:15,340 --> 01:08:21,499
The guy goes and makes an altcoin and says, look guys, I built all this, it works.

674
01:08:22,059 --> 01:08:23,179
Do you want to try out?

675
01:08:23,819 --> 01:08:25,580
Fuck off, we are not buying your shitcoin.

676
01:08:26,460 --> 01:08:31,900
And so basically, this is the repeating dynamic that I have noticed.

677
01:08:32,700 --> 01:08:38,700
And I think this is one of the most unfortunate side effects of this that we do not have.

678
01:08:39,900 --> 01:08:47,340
These acceptably not centralized or acceptably decentralized sidechains

679
01:08:48,140 --> 01:08:51,819
since, I don't know, since like 2015 or something.

680
01:08:52,379 --> 01:09:00,059
So this is one of this whole, as you guys said, PTSD that we are living.

681
01:09:00,059 --> 01:09:03,979
And this dynamic is really unfortunate and sad.

682
01:09:05,660 --> 01:09:12,059
Yeah, we see only the tip of the iceberg with respect to all of the people,

683
01:09:12,059 --> 01:09:14,299
like even I only see the tip of the iceberg.

684
01:09:14,299 --> 01:09:15,819
I only know like whatever I've...

685
01:09:15,819 --> 01:09:18,859
Because it's a type of knowledge that doesn't diffuse

686
01:09:18,859 --> 01:09:22,379
because it's like caught up in like shame and like all this weird cult nonsense.

687
01:09:22,939 --> 01:09:23,580
So it's like...

688
01:09:24,299 --> 01:09:27,419
But we know from first-hand experience,

689
01:09:27,419 --> 01:09:32,299
so many people have either had an interesting idea or they have wanted to try an idea.

690
01:09:32,299 --> 01:09:37,580
And these are just the few people who were willing to take the risk or...

691
01:09:38,299 --> 01:09:40,220
Right now, it's actively discouraged.

692
01:09:40,220 --> 01:09:43,260
It's not even like encouraged.

693
01:09:43,260 --> 01:09:45,819
But so many people would just like take their own time.

694
01:09:45,819 --> 01:09:47,419
Jeremy Rubin is a perfect example.

695
01:09:48,379 --> 01:09:54,059
They take time out of their day to work on this idea and then not only invent the idea,

696
01:09:54,059 --> 01:10:01,020
but then try to publish the idea, register like a domain, make a website, do all this work.

697
01:10:02,700 --> 01:10:08,059
So I think this really speaks to how difficult it is to actually figure out

698
01:10:09,100 --> 01:10:12,220
like what sidechains would be popular.

699
01:10:12,379 --> 01:10:15,419
We really see only the tip of the iceberg of...

700
01:10:16,059 --> 01:10:18,299
And it's unfortunate because just think of how...

701
01:10:18,299 --> 01:10:21,580
Think of the cost-benefit analysis on running like a little scam

702
01:10:22,540 --> 01:10:26,059
or just pumping NFT, the cost-benefit...

703
01:10:33,100 --> 01:10:34,140
Paul, I can't hear you.

704
01:10:34,140 --> 01:10:35,260
Yeah, I was wondering if it was me.

705
01:10:36,540 --> 01:10:38,299
Maybe it cut out for him for a moment.

706
01:10:42,780 --> 01:10:51,660
Reyndal, what you were saying was so interesting, how maybe one of the main uses of drivechain

707
01:10:51,660 --> 01:10:59,340
would be the issuance of something better than wrapped Bitcoin.

708
01:10:59,340 --> 01:11:06,939
It's interesting how demand for wrapped Bitcoin does create higher price for Bitcoin on mainchain

709
01:11:06,939 --> 01:11:11,739
because of the two-way peg, although it's federated and run by BitGo.

710
01:11:12,700 --> 01:11:15,979
You know, when people demand that wrapped Bitcoin token,

711
01:11:15,979 --> 01:11:18,939
there's a higher price for Bitcoin as a result.

712
01:11:19,819 --> 01:11:21,819
So it is good for Bitcoin in that sense.

713
01:11:21,819 --> 01:11:28,220
As you described correctly, people want to participate in Bitcoin's monetary policy,

714
01:11:28,220 --> 01:11:31,340
but use the features of Ethereum.

715
01:11:31,340 --> 01:11:33,179
And that's why there's demand for wrapped Bitcoin.

716
01:11:33,179 --> 01:11:34,379
It's like $4 billion.

717
01:11:34,379 --> 01:11:39,979
But of course, Bitcoin is missing out on the transaction fees from that activity.

718
01:11:40,939 --> 01:11:45,100
By the way, would it make sense to make a wrapped Bitcoin on a sidechain?

719
01:11:45,100 --> 01:11:46,700
On a Bitcoin sidechain at all?

720
01:11:46,700 --> 01:11:53,499
I mean, the whole point of sidechains is we are having an altcoin that is pegged one-to-one

721
01:11:53,499 --> 01:11:54,140
to Bitcoin.

722
01:11:54,140 --> 01:11:58,220
So you can just skip the textile step altogether.

723
01:12:01,020 --> 01:12:04,939
Yeah, I think we all agree on that.

724
01:12:05,819 --> 01:12:10,059
Basically, people want to use the Bitcoin token, the unit of account,

725
01:12:10,059 --> 01:12:14,059
but they want the features of, for example, a privacy blockchain,

726
01:12:14,780 --> 01:12:17,979
but with Bitcoin as the unit of account, a synthetic Bitcoin.

727
01:12:20,619 --> 01:12:22,220
Sorry, guys, my app crashed.

728
01:12:22,220 --> 01:12:26,700
So clearly, there's something that they don't want you to hear, you know.

729
01:12:27,499 --> 01:12:31,979
But what I was going to say is that I don't really think anyone,

730
01:12:32,299 --> 01:12:35,419
in my own personal experience, this may be incorrect.

731
01:12:35,419 --> 01:12:35,900
I don't know.

732
01:12:35,900 --> 01:12:43,340
But I don't really think anyone, most people, this may have been a function of when I joined

733
01:12:43,340 --> 01:12:43,900
Bitcoin.

734
01:12:44,700 --> 01:12:45,580
I don't know.

735
01:12:45,580 --> 01:12:52,700
But just my personal experience has been that none of the people who later go on to do,

736
01:12:54,299 --> 01:12:58,059
most people, if they have a good idea, they show up and they think,

737
01:12:58,059 --> 01:13:05,020
wow, Bitcoin is way cooler than Chase Manhattan, like my checking account.

738
01:13:05,020 --> 01:13:07,100
Bitcoin is way cooler than PayPal.

739
01:13:07,660 --> 01:13:09,020
They're like, this is so cool.

740
01:13:09,020 --> 01:13:09,819
I love Bitcoin.

741
01:13:10,379 --> 01:13:15,100
And then what they think is, here's my cool idea for how to make Bitcoin better.

742
01:13:16,299 --> 01:13:20,460
Almost no one shows up and then they say, okay, I'm going to launch an altcoin.

743
01:13:20,460 --> 01:13:22,140
I'm going to compete with Bitcoin.

744
01:13:22,140 --> 01:13:24,140
I'm going to defeat and overthrow Bitcoin.

745
01:13:24,140 --> 01:13:25,660
And then I'm going to have conquered the world.

746
01:13:26,460 --> 01:13:32,140
I don't really know of anyone who actually fits that description in the slightest.

747
01:13:32,140 --> 01:13:34,700
Even Vitalik was co-founder of Bitcoin Magazine.

748
01:13:34,700 --> 01:13:37,179
He wrote for Bitcoin Magazine for many years.

749
01:13:37,179 --> 01:13:39,499
He was like a diehard Bitcoiner.

750
01:13:40,460 --> 01:13:42,220
Roger Ver was obviously a diehard.

751
01:13:42,220 --> 01:13:45,900
People really do not turn to the altcoin solution.

752
01:13:45,900 --> 01:13:50,939
It is like a last resort for most of the people I know who had any serious talent.

753
01:13:51,419 --> 01:13:57,739
People are dragged cooking and screaming into the altcoin world to some extent.

754
01:13:57,739 --> 01:14:02,140
And there's other people, not so much, but those are mostly the generic,

755
01:14:03,499 --> 01:14:06,379
those are the projects that usually aren't as viable.

756
01:14:07,100 --> 01:14:13,340
Those are the whatever, like the NFT or just something that's not...

757
01:14:13,340 --> 01:14:17,900
I had one thing I was going to say before I got cut off about the earlier question about ETH.

758
01:14:18,540 --> 01:14:22,140
I had a direct idea about will it just be a wrapped Bitcoin on ETH.

759
01:14:23,739 --> 01:14:25,979
First of all, again, ETH does have network effects.

760
01:14:27,179 --> 01:14:29,660
So there's some gravity to that.

761
01:14:31,260 --> 01:14:36,780
But the ETH also has the property that the fees will fill up.

762
01:14:36,780 --> 01:14:43,260
The fees are paid in Ether and the fees eventually become high on Ethereum, the altcoin.

763
01:14:43,979 --> 01:14:47,419
Whereas if you have ETH, the sidechain, like EVM sidechain,

764
01:14:49,020 --> 01:14:52,540
once the fees fill up, you can just stamp out a second ETH sidechain.

765
01:14:54,059 --> 01:14:58,379
And now maybe it's unclear because different network effects and things,

766
01:14:58,379 --> 01:15:04,220
but it does seem like then everyone's focused on just the right thing,

767
01:15:04,220 --> 01:15:07,419
which is how to get more users, how to get more users.

768
01:15:07,900 --> 01:15:13,340
Or if people are chasing lower fees, then maybe they start on network one

769
01:15:13,340 --> 01:15:14,859
and then that one fills up.

770
01:15:14,859 --> 01:15:16,939
And so somebody makes an alternative network.

771
01:15:16,939 --> 01:15:21,580
And I think the thing that I'm trying to think through is whenever I...

772
01:15:23,260 --> 01:15:25,499
There's like a substitution principle here, right?

773
01:15:25,499 --> 01:15:29,340
Where it's like, if the thing that I want is I want to take my Bitcoin unit of an account

774
01:15:29,900 --> 01:15:36,379
and go use it somewhere else that has better smart contracts or bigger blocks or more privacy

775
01:15:36,379 --> 01:15:38,140
or whatever the thing is, right?

776
01:15:39,660 --> 01:15:45,660
Within that category, maybe those other chains are fungible to each other, right?

777
01:15:45,660 --> 01:15:48,220
Because I can always come back to Bitcoin.

778
01:15:48,220 --> 01:15:52,780
So if I'm using Avalanche one day and Solana the next day,

779
01:15:52,780 --> 01:15:56,059
if it has the features that I want, what do I care if I have

780
01:15:57,419 --> 01:16:00,379
a trust-minimized peg back to Bitcoin?

781
01:16:00,379 --> 01:16:05,660
And so I think part of the rationale for sidechains in the past

782
01:16:05,660 --> 01:16:13,340
has always been that you'll pay your layer one fees in Bitcoin

783
01:16:13,340 --> 01:16:15,100
instead of in whatever the native token is.

784
01:16:15,660 --> 01:16:19,179
But these things have network effects.

785
01:16:19,179 --> 01:16:25,419
And so if we end up with like, we activate drivechains tomorrow,

786
01:16:25,979 --> 01:16:31,260
the day after tomorrow, drivechain ends up mostly just being used

787
01:16:31,260 --> 01:16:38,219
as like a bridging mechanism to go from Bitcoin to these other alternative layer ones

788
01:16:38,219 --> 01:16:41,979
that have these other capabilities that have like their own token and you're paying,

789
01:16:41,979 --> 01:16:46,219
you know, ETH fees in ETH, you're paying Avalanche fees in Avalanche,

790
01:16:46,219 --> 01:16:49,979
you're paying, I don't know, Cardano fees in Cardano, like whatever.

791
01:16:51,739 --> 01:16:53,420
Like, maybe that's okay, right?

792
01:16:53,420 --> 01:16:55,979
Like, because it still drives demand for Bitcoin.

793
01:16:55,979 --> 01:16:57,979
It's still through blind merge mining.

794
01:16:57,979 --> 01:17:01,579
You still provide like security budget for Bitcoin.

795
01:17:02,459 --> 01:17:03,579
Maybe it doesn't really matter.

796
01:17:03,579 --> 01:17:06,300
But I think it's like a little bit different from the,

797
01:17:07,499 --> 01:17:09,979
I don't know, dogmatic view of sidechains.

798
01:17:14,219 --> 01:17:17,979
Isn't the plan to clone the altcoin technology

799
01:17:17,979 --> 01:17:21,180
so that there is no other blockchain other than the sidechains?

800
01:17:21,180 --> 01:17:24,060
Yeah, but like, people actually use that, right?

801
01:17:24,459 --> 01:17:29,339
Like, people have cloned ETH and put it on Rootstock.

802
01:17:29,339 --> 01:17:33,979
And Rootstock isn't perfect, but there's, you know, many orders of magnitude,

803
01:17:33,979 --> 01:17:37,579
more economic activity happening on ETH than there is on Rootstock,

804
01:17:37,579 --> 01:17:41,739
despite the fact that there's analogs to all of the ETH things on Rootstock.

805
01:17:42,619 --> 01:17:47,339
Isn't it an apples to oranges comparison when the entire Rootstock ecosystem

806
01:17:47,339 --> 01:17:50,619
has to be federated by necessity due to the lack

807
01:17:50,619 --> 01:17:53,499
of the peer-to-peer sidechain architecture of drivechain?

808
01:17:54,619 --> 01:17:55,420
Well, I don't know.

809
01:17:55,420 --> 01:17:55,900
Maybe.

810
01:17:55,900 --> 01:17:57,020
I mean, it's hard to say.

811
01:17:57,020 --> 01:18:02,859
Like, I wonder how many people actually even know or actually care about any of the...

812
01:18:04,619 --> 01:18:05,660
I don't know about that.

813
01:18:05,660 --> 01:18:09,739
I think RSK is like weird.

814
01:18:10,540 --> 01:18:11,820
RSK is a weird...

815
01:18:13,180 --> 01:18:18,219
It's kind of difficult for me to view RSK as an experiment.

816
01:18:18,219 --> 01:18:18,859
I don't know.

817
01:18:19,820 --> 01:18:23,739
Like, what I mean by that is there's a lot of confounding variables, I think.

818
01:18:24,300 --> 01:18:26,060
One of them is the federation, which...

819
01:18:27,499 --> 01:18:31,579
Does anyone know who are the federation members and how are they chosen?

820
01:18:31,579 --> 01:18:32,540
And what is the ceremony?

821
01:18:32,540 --> 01:18:36,940
It's the same problem with Liquid, where you just think, like, who are the people?

822
01:18:37,579 --> 01:18:38,619
No one knows.

823
01:18:38,619 --> 01:18:39,739
The whole thing rests on their...

824
01:18:39,739 --> 01:18:40,300
Yeah.

825
01:18:40,300 --> 01:18:44,379
You could argue that just having BitGo hold it is actually better than a federation with

826
01:18:44,379 --> 01:18:47,820
unknown participants, because you don't know if the federation is just one dude in his basement

827
01:18:47,820 --> 01:18:49,739
or if it's actually a federation of different people.

828
01:18:50,619 --> 01:18:51,820
Well, Warren Tagami...

829
01:18:52,060 --> 01:18:55,020
That is something that people pick up on with the federation.

830
01:18:55,020 --> 01:18:59,820
They kind of think, like, in an abstract sense, they think a federation is okay.

831
01:18:59,820 --> 01:19:05,420
But then when push comes to shove and you have to put your $200 on the chain, people

832
01:19:05,420 --> 01:19:08,859
kind of think, like, they have this moment where they're like, wait a minute, what am

833
01:19:08,859 --> 01:19:09,420
I doing now?

834
01:19:10,219 --> 01:19:12,060
What kind of boat am I getting into right now?

835
01:19:12,780 --> 01:19:16,300
And they kind of think, like, maybe I'll just wait.

836
01:19:17,020 --> 01:19:25,099
So I do think the federation is worse than even the regular ETH altcoin consensus, because

837
01:19:25,099 --> 01:19:28,300
people do eventually have this weird reaction where they don't really know.

838
01:19:28,300 --> 01:19:30,219
Like, you're like, what does that mean, a federation?

839
01:19:30,219 --> 01:19:31,739
And you can see why BitGo...

840
01:19:32,075 --> 01:19:34,075
doesn't do it, because...

841
01:19:34,075 --> 01:19:37,515
who wants to be... like, who wants this job? Like, no one.

842
01:19:37,515 --> 01:19:40,955
You could sign up to be a federation member, there could be some kind of glitch,

843
01:19:40,955 --> 01:19:42,955
and then you could be blamed.

844
01:19:42,955 --> 01:19:44,955
Or you could get...

845
01:19:44,955 --> 01:19:49,755
you know, Gary Gensler could be all you into Congress or something.

846
01:19:49,755 --> 01:19:53,355
Like, who wants this job? No one. BitGo doesn't want to do the Ethereum thing,

847
01:19:53,355 --> 01:19:56,155
and then the DAO hack happens. It's like a giant mess, so...

848
01:19:56,155 --> 01:19:58,954
But there's a lot of confounding things with RSK.

849
01:19:59,034 --> 01:20:04,235
RSK just has this weird X-factor that is very hard for people to place,

850
01:20:04,235 --> 01:20:06,235
where you just think, like...

851
01:20:06,235 --> 01:20:08,235
just, it's like kind of...

852
01:20:08,235 --> 01:20:12,235
they have this dense, impenetrable quality about them

853
01:20:12,235 --> 01:20:14,235
that it's very hard for me to understand or explain,

854
01:20:14,235 --> 01:20:18,235
but it's something that goes along the lines of...

855
01:20:18,235 --> 01:20:20,235
no one knows what RSK is doing,

856
01:20:20,235 --> 01:20:22,235
they don't show up...

857
01:20:22,235 --> 01:20:24,235
they show up to, like, some events,

858
01:20:24,235 --> 01:20:28,235
but no, they don't, like, really...

859
01:20:28,514 --> 01:20:32,514
It's difficult, because if you're into ETH stuff,

860
01:20:32,514 --> 01:20:33,514
you would probably...

861
01:20:33,514 --> 01:20:37,515
See, another confounding thing is that ETH has a viable...

862
01:20:37,515 --> 01:20:41,515
like, the ETH plan is to flip in BTC.

863
01:20:41,515 --> 01:20:45,515
So imagine that the final destination is $300 trillion market cap.

864
01:20:45,515 --> 01:20:49,515
If you get there from $30,000, you did pretty well.

865
01:20:49,515 --> 01:20:52,515
But you'd do even better if you can get there from whatever the...

866
01:20:52,515 --> 01:20:56,515
if you adjust Ethereum's price to normalize it to 21 million units,

867
01:20:56,795 --> 01:20:58,795
whatever that would be.

868
01:20:58,795 --> 01:21:04,795
So if you get there from $4,000 for 21 millionth,

869
01:21:04,795 --> 01:21:06,795
then you did even better.

870
01:21:06,795 --> 01:21:08,795
So the ETH people, they like ETH,

871
01:21:08,795 --> 01:21:10,795
and they think, well, if I think ETH is a good thing,

872
01:21:10,795 --> 01:21:12,795
maybe we can flip in.

873
01:21:12,795 --> 01:21:14,795
It's all about the flippening.

874
01:21:14,795 --> 01:21:16,795
So they want to flip in also.

875
01:21:16,795 --> 01:21:18,795
So if they really like ETH, they want to flip in.

876
01:21:18,795 --> 01:21:20,795
So why join RSK when you can just break even

877
01:21:20,795 --> 01:21:22,795
with every other Bitcoiner?

878
01:21:22,795 --> 01:21:24,795
If you're into your ETH thing,

879
01:21:25,075 --> 01:21:29,075
why not just throw in with Ethereum or whatever?

880
01:21:29,075 --> 01:21:31,075
After all, you have a thing that you like

881
01:21:31,075 --> 01:21:35,075
that you know that they are wrongly shunning.

882
01:21:35,075 --> 01:21:37,075
So I think there's a lot of complicated things.

883
01:21:37,075 --> 01:21:39,075
But with sidechains, it might be different.

884
01:21:39,075 --> 01:21:41,075
It may be different.

885
01:21:41,075 --> 01:21:43,075
And maybe, as was suggested earlier,

886
01:21:43,075 --> 01:21:45,075
maybe kind of too late.

887
01:21:45,075 --> 01:21:47,075
But maybe not.

888
01:21:47,075 --> 01:21:49,075
And what I'm getting at is the idea would be,

889
01:21:49,075 --> 01:21:53,075
once we have sidechains that are popular,

890
01:21:53,354 --> 01:21:55,354
that everyone understands,

891
01:21:55,354 --> 01:21:57,354
and that lots of people use,

892
01:21:57,354 --> 01:21:59,354
people would kind of shrug,

893
01:21:59,354 --> 01:22:01,354
and they would say, you know what?

894
01:22:01,354 --> 01:22:03,354
Ethereum, the altcoin, doesn't have a future

895
01:22:03,354 --> 01:22:05,354
because we have the EVM,

896
01:22:05,354 --> 01:22:07,354
we have the healthy EVM sidechain.

897
01:22:07,354 --> 01:22:09,354
And so not because of anything Ethereum did wrong,

898
01:22:09,354 --> 01:22:11,354
but people would then abandon it,

899
01:22:11,354 --> 01:22:13,354
and that would be the reason why

900
01:22:13,354 --> 01:22:15,354
it would be different than RSK.

901
01:22:15,354 --> 01:22:17,354
But this is a very weird thing.

902
01:22:17,354 --> 01:22:19,354
A lot of stuff about RSK is just kind of like

903
01:22:19,354 --> 01:22:21,354
difficult for me to think about.

904
01:22:21,634 --> 01:22:23,634
And everyone else that I talk to

905
01:22:23,634 --> 01:22:25,634
kind of feels the same way.

906
01:22:25,634 --> 01:22:27,634
I don't know.

907
01:22:27,634 --> 01:22:29,634
They're just hanging out down there

908
01:22:29,634 --> 01:22:31,634
in Argentina or something.

909
01:22:31,634 --> 01:22:33,634
I don't know.

910
01:22:33,634 --> 01:22:35,634
I can't really explain it.

911
01:22:35,634 --> 01:22:37,634
But there's a very imperceptible vibe

912
01:22:37,634 --> 01:22:39,634
for some reason.

913
01:22:39,634 --> 01:22:41,634
Randall, what do you think?

914
01:22:41,634 --> 01:22:43,634
What are your current thoughts

915
01:22:43,634 --> 01:22:45,634
on drivechain generally,

916
01:22:45,634 --> 01:22:47,634
and how it might lead to a new understanding

917
01:22:47,634 --> 01:22:49,634
throughout all of the crypto community

918
01:22:49,634 --> 01:22:51,634
that almost anything can be built

919
01:22:51,634 --> 01:22:53,634
on Bitcoin that previously

920
01:22:53,634 --> 01:22:55,634
couldn't exist in a peer-to-peer

921
01:22:55,634 --> 01:22:57,634
manner on Bitcoin,

922
01:22:57,634 --> 01:22:59,634
and therefore that gave rise to altcoins

923
01:22:59,634 --> 01:23:01,634
for a decade.

924
01:23:01,634 --> 01:23:03,634
But then, because of the adoption of drivechain,

925
01:23:03,634 --> 01:23:05,634
now all of that tech with its users

926
01:23:05,634 --> 01:23:07,634
and value will flow back to Bitcoin,

927
01:23:07,634 --> 01:23:09,634
and Bitcoin would be

928
01:23:09,634 --> 01:23:11,634
the layer one for every blockchain,

929
01:23:11,634 --> 01:23:13,634
literally.

930
01:23:13,634 --> 01:23:15,634
Do you find that vision

931
01:23:15,634 --> 01:23:17,634
potentially compelling?

932
01:23:17,634 --> 01:23:19,634
So,

933
01:23:19,634 --> 01:23:21,634
I think

934
01:23:21,634 --> 01:23:23,634
that it's

935
01:23:23,634 --> 01:23:25,634
not likely that

936
01:23:25,634 --> 01:23:27,634
ETH has

937
01:23:27,634 --> 01:23:29,634
half the market cap of Bitcoin.

938
01:23:29,634 --> 01:23:31,634
So, I don't think it's

939
01:23:31,634 --> 01:23:33,634
likely that if we had drivechains

940
01:23:33,634 --> 01:23:35,634
tomorrow that ETH would just

941
01:23:35,634 --> 01:23:37,634
poof, evaporate, and all of that

942
01:23:37,634 --> 01:23:39,634
market cap

943
01:23:39,634 --> 01:23:41,634
would come to Bitcoin. I think what's more likely

944
01:23:41,634 --> 01:23:43,634
is

945
01:23:43,634 --> 01:23:45,634
there would be a race

946
01:23:45,634 --> 01:23:47,634
to say, hey, we're going to build

947
01:23:47,634 --> 01:23:49,634
a...

948
01:23:49,634 --> 01:23:51,634
Sorry, one second.

949
01:23:51,634 --> 01:23:53,634
We're going to build

950
01:23:53,634 --> 01:23:55,634
a, air quotes, trustless peg

951
01:23:55,634 --> 01:23:57,634
to ETH, and

952
01:23:57,634 --> 01:23:59,634
you can move Bitcoin onto

953
01:23:59,634 --> 01:24:01,634
ETH and use

954
01:24:01,634 --> 01:24:03,634
that ecosystem, and I think that thing

955
01:24:03,634 --> 01:24:05,634
would be very

956
01:24:05,634 --> 01:24:07,634
strong in the market. I think

957
01:24:07,634 --> 01:24:09,634
what would be a good impact...

958
01:24:09,634 --> 01:24:11,634
So, for one thing, that might

959
01:24:11,634 --> 01:24:13,634
sound really gross, but I think

960
01:24:13,634 --> 01:24:15,634
that would actually be a net positive for Bitcoin

961
01:24:15,634 --> 01:24:17,634
because instead of people having

962
01:24:17,634 --> 01:24:19,634
to say, oh, I have

963
01:24:19,634 --> 01:24:21,634
Bitcoin, but I want to go use some

964
01:24:21,634 --> 01:24:23,634
DeFi or NFT thing, they would

965
01:24:23,634 --> 01:24:25,634
say, hey, I can go and use my Bitcoin with

966
01:24:25,634 --> 01:24:27,634
that DeFi NFT thing, and I think that would actually

967
01:24:27,634 --> 01:24:29,634
be a net positive for Bitcoin.

968
01:24:29,634 --> 01:24:31,634
I think where you'd see

969
01:24:31,634 --> 01:24:33,634
real

970
01:24:33,634 --> 01:24:35,634
impact would be

971
01:24:35,634 --> 01:24:37,634
that things that are like, net

972
01:24:37,634 --> 01:24:39,634
new, instead of

973
01:24:39,634 --> 01:24:41,634
it being like, hey,

974
01:24:41,634 --> 01:24:43,634
I need to pick either Bitcoin with

975
01:24:43,634 --> 01:24:45,634
less features or some altcoin

976
01:24:45,634 --> 01:24:47,634
with more features, you could just say,

977
01:24:47,634 --> 01:24:49,634
I'm going to use a Bitcoin sidechain.

978
01:24:49,634 --> 01:24:51,634
If you wanted to do some crazy

979
01:24:51,634 --> 01:24:53,634
new custody scheme, or if you wanted to do

980
01:24:53,634 --> 01:24:55,634
some crazy new ZK scheme, or

981
01:24:55,634 --> 01:24:57,634
some crazy

982
01:24:57,634 --> 01:24:59,634
high throughput, but simple

983
01:24:59,634 --> 01:25:01,634
transaction scheme, then

984
01:25:01,634 --> 01:25:03,634
you could do that on Bitcoin,

985
01:25:03,634 --> 01:25:05,634
and you could do it on a Bitcoin sidechain, and I think

986
01:25:05,634 --> 01:25:07,634
that that would be really compelling. The thing

987
01:25:07,634 --> 01:25:09,634
that I'm wrestling with is, I don't

988
01:25:09,634 --> 01:25:11,634
think that all of the alt mark

989
01:25:11,634 --> 01:25:13,634
cap would suddenly go to zero.

990
01:25:13,634 --> 01:25:15,634
I think those network effects are real,

991
01:25:15,634 --> 01:25:17,634
and I think that

992
01:25:17,634 --> 01:25:19,634
Bitcoin would be able to better coexist

993
01:25:19,634 --> 01:25:21,634
with them, but I think what would be

994
01:25:21,634 --> 01:25:23,634
really nice is

995
01:25:23,634 --> 01:25:25,634
if you woke up tomorrow and you

996
01:25:25,634 --> 01:25:27,634
read some cool new ZK

997
01:25:27,634 --> 01:25:29,634
paper for doing better,

998
01:25:29,634 --> 01:25:31,634
more private payments, instead

999
01:25:31,634 --> 01:25:33,634
of having to say, oh shit, let me

1000
01:25:33,634 --> 01:25:35,634
go find an altcoin for this,

1001
01:25:35,634 --> 01:25:37,634
you'd be able to say, let me do

1002
01:25:37,634 --> 01:25:39,634
a trustless Bitcoin sidechain

1003
01:25:39,634 --> 01:25:41,634
for this. So I

1004
01:25:41,634 --> 01:25:43,634
think, I don't know,

1005
01:25:43,634 --> 01:25:45,634
I've been pretty down on

1006
01:25:45,634 --> 01:25:47,634
drivechains generally. I'm

1007
01:25:47,634 --> 01:25:49,634
very slowly coming

1008
01:25:49,634 --> 01:25:51,634
around to it, and I

1009
01:25:51,634 --> 01:25:53,634
think that overall,

1010
01:25:55,634 --> 01:25:57,634
I don't know, I'm skeptical

1011
01:25:57,634 --> 01:25:59,634
about there being enough

1012
01:25:59,634 --> 01:26:01,634
consensus for activation, but

1013
01:26:01,634 --> 01:26:03,634
I think if somehow you were able

1014
01:26:03,634 --> 01:26:05,634
to do it, I think it would be a net positive for Bitcoin.

1015
01:26:07,634 --> 01:26:09,634
Rinder, quick question.

1016
01:26:09,634 --> 01:26:11,634
Would you like,

1017
01:26:11,634 --> 01:26:13,634
would you prefer a

1018
01:26:13,634 --> 01:26:15,634
drivechain implementation

1019
01:26:15,634 --> 01:26:17,634
of liquidity elements

1020
01:26:17,634 --> 01:26:19,634
of codes to

1021
01:26:19,634 --> 01:26:21,634
a federated one?

1022
01:26:21,634 --> 01:26:23,634
Yeah, I think I would, and I was thinking

1023
01:26:23,634 --> 01:26:25,634
about this a couple days ago,

1024
01:26:25,634 --> 01:26:27,634
so SuperTestNet

1025
01:26:27,634 --> 01:26:29,634
did a

1026
01:26:29,634 --> 01:26:31,634
thing called AnchorInk,

1027
01:26:31,634 --> 01:26:33,634
which was kind of like

1028
01:26:33,634 --> 01:26:35,634
a drivechain-like

1029
01:26:35,634 --> 01:26:37,634
thing,

1030
01:26:37,634 --> 01:26:39,634
but how it worked was

1031
01:26:39,634 --> 01:26:41,634
the idea is

1032
01:26:41,634 --> 01:26:43,634
that miners would put a

1033
01:26:43,634 --> 01:26:45,634
pubkey into the coinbase

1034
01:26:45,634 --> 01:26:47,634
transaction just as part of the OP_RETURN,

1035
01:26:47,634 --> 01:26:49,634
and then what you could do

1036
01:26:49,634 --> 01:26:51,634
is you could make yourself

1037
01:26:51,634 --> 01:26:53,634
a federated multisig

1038
01:26:53,634 --> 01:26:55,634
out of the pubkeys

1039
01:26:55,634 --> 01:26:57,634
that the last six months

1040
01:26:57,634 --> 01:26:59,634
worth of miners had

1041
01:26:59,634 --> 01:27:01,634
mined,

1042
01:27:01,634 --> 01:27:03,634
right? And so it kind of looks

1043
01:27:03,634 --> 01:27:05,634
like hashrate escrow, but it's with

1044
01:27:05,634 --> 01:27:07,634
this static set, and I was thinking

1045
01:27:07,634 --> 01:27:09,634
about what's wrong with that.

1046
01:27:09,634 --> 01:27:11,634
Without the hashrate escrow, right?

1047
01:27:11,634 --> 01:27:13,634
So it's really a miner

1048
01:27:13,634 --> 01:27:15,634
dynamic federation without

1049
01:27:15,634 --> 01:27:17,634
the hashrate escrow. Yes, exactly.

1050
01:27:17,634 --> 01:27:19,634
It's miner dynafed, right?

1051
01:27:19,634 --> 01:27:21,634
And

1052
01:27:21,634 --> 01:27:23,634
the thing that I realized is that

1053
01:27:23,634 --> 01:27:25,634
one of the things that's clever

1054
01:27:25,634 --> 01:27:27,634
about hashrate escrow

1055
01:27:27,634 --> 01:27:29,634
is that

1056
01:27:29,634 --> 01:27:31,634
say that you

1057
01:27:31,634 --> 01:27:33,634
are a drivechain

1058
01:27:33,634 --> 01:27:35,634
community, so like you're running a sidechain,

1059
01:27:35,634 --> 01:27:37,634
and you

1060
01:27:37,634 --> 01:27:39,634
think that the miners

1061
01:27:39,634 --> 01:27:41,634
are colluding to

1062
01:27:41,634 --> 01:27:43,634
pilfer your sidechain.

1063
01:27:43,634 --> 01:27:45,634
If you have enough

1064
01:27:45,634 --> 01:27:47,634
economic activity on your

1065
01:27:47,634 --> 01:27:49,634
sidechain, you could just

1066
01:27:49,634 --> 01:27:51,634
go and buy a bunch of

1067
01:27:51,634 --> 01:27:53,634
S19s, or go

1068
01:27:53,634 --> 01:27:55,634
and rent a bunch of hashrate, or go and

1069
01:27:55,634 --> 01:27:57,634
just pay a bunch of miners

1070
01:27:57,634 --> 01:27:59,634
to mine

1071
01:27:59,634 --> 01:28:01,634
blocks that resist

1072
01:28:01,634 --> 01:28:03,634
that peg out, that

1073
01:28:03,634 --> 01:28:05,634
resist that withdrawal.

1074
01:28:05,634 --> 01:28:07,634
You have

1075
01:28:07,634 --> 01:28:09,634
economic means to

1076
01:28:09,634 --> 01:28:11,634
resist a

1077
01:28:11,634 --> 01:28:13,634
malicious peg out under

1078
01:28:13,634 --> 01:28:15,634
drivechains, under proper drivechains.

1079
01:28:15,634 --> 01:28:17,634
And I think if you do something like

1080
01:28:17,634 --> 01:28:19,634
a

1081
01:28:19,634 --> 01:28:21,634
hand crank mechanism

1082
01:28:21,634 --> 01:28:23,634
where it's like a dynafed

1083
01:28:23,634 --> 01:28:25,634
that's looking backwards on

1084
01:28:25,634 --> 01:28:27,634
the last six months of blocks, then you don't.

1085
01:28:27,634 --> 01:28:29,634
And so I've been really

1086
01:28:29,634 --> 01:28:31,634
I still am

1087
01:28:31,634 --> 01:28:33,634
very cautiously optimistic on

1088
01:28:33,634 --> 01:28:35,634
having some

1089
01:28:35,634 --> 01:28:37,634
ZK opcode plus

1090
01:28:37,634 --> 01:28:39,634
a covenant

1091
01:28:39,634 --> 01:28:41,634
to do peg out from

1092
01:28:41,634 --> 01:28:43,634
sidechains or from L2s.

1093
01:28:43,634 --> 01:28:45,634
But I think you kind of always end up

1094
01:28:45,634 --> 01:28:47,634
running into a data availability problem.

1095
01:28:47,634 --> 01:28:49,634
So I think

1096
01:28:49,634 --> 01:28:51,634
you kind of have

1097
01:28:51,634 --> 01:28:53,634
to choose. Do you want to have a data

1098
01:28:53,634 --> 01:28:55,634
availability problem with some kind of

1099
01:28:55,634 --> 01:28:57,634
ZK rollup, or do you want

1100
01:28:57,634 --> 01:28:59,634
to have a

1101
01:28:59,634 --> 01:29:01,634
like miners can steal

1102
01:29:01,634 --> 01:29:03,634
but they are constrained

1103
01:29:03,634 --> 01:29:05,634
by their own economic incentives

1104
01:29:05,634 --> 01:29:07,634
problem. And I think

1105
01:29:07,634 --> 01:29:09,634
the magic of Bitcoin

1106
01:29:09,634 --> 01:29:11,634
is that it takes

1107
01:29:11,634 --> 01:29:13,634
what is an unsolvable problem

1108
01:29:13,634 --> 01:29:15,634
and

1109
01:29:15,634 --> 01:29:17,634
mitigates it with economics.

1110
01:29:17,634 --> 01:29:19,634
And

1111
01:29:19,634 --> 01:29:21,634
if we're already bought into that

1112
01:29:21,634 --> 01:29:23,634
idea, then maybe

1113
01:29:23,634 --> 01:29:25,634
we should just

1114
01:29:25,634 --> 01:29:27,634
embrace the fact that

1115
01:29:27,634 --> 01:29:29,634
miners can find MEV

1116
01:29:29,634 --> 01:29:31,634
anyway, so let's at least

1117
01:29:31,634 --> 01:29:33,634
standardize it and put it on chain

1118
01:29:33,634 --> 01:29:35,634
and make it in a way that everybody can audit.

1119
01:29:39,634 --> 01:29:41,634
One interesting thought experiment

1120
01:29:41,634 --> 01:29:43,634
regarding network effects from the

1121
01:29:43,634 --> 01:29:45,634
prior topic was

1122
01:29:45,634 --> 01:29:47,634
when you were saying that Ethereum has

1123
01:29:47,634 --> 01:29:49,634
a lot of network effects, so

1124
01:29:49,634 --> 01:29:51,634
if we just clone Ethereum into a drivechain

1125
01:29:51,634 --> 01:29:53,634
we can't expect those users

1126
01:29:53,634 --> 01:29:55,634
to flow over overnight. However,

1127
01:29:55,634 --> 01:29:57,634
imagine in a smaller example

1128
01:29:57,634 --> 01:29:59,634
the privacy altcoins, Monero

1129
01:29:59,634 --> 01:30:01,634
and Zcash. They have

1130
01:30:01,634 --> 01:30:03,634
a substantial amount of users

1131
01:30:03,634 --> 01:30:05,634
who are focused on not just

1132
01:30:05,634 --> 01:30:07,634
the number go up potential, but

1133
01:30:07,634 --> 01:30:09,634
the features, the privacy

1134
01:30:09,634 --> 01:30:11,634
technology that's more advanced

1135
01:30:11,634 --> 01:30:13,634
than what Bitcoin offers generally.

1136
01:30:13,634 --> 01:30:15,634
So...

1137
01:30:15,634 --> 01:30:17,634
I totally agree with those things.

1138
01:30:17,634 --> 01:30:19,634
By the way, we have

1139
01:30:19,634 --> 01:30:21,634
a bit harder as a speaker

1140
01:30:21,634 --> 01:30:23,634
and we just didn't let...

1141
01:30:23,634 --> 01:30:25,634
Yeah.

1142
01:30:25,634 --> 01:30:27,634
Well,

1143
01:30:27,634 --> 01:30:29,634
I wanted to ask

1144
01:30:29,634 --> 01:30:31,634
what do

1145
01:30:31,634 --> 01:30:33,634
you mean by

1146
01:30:33,634 --> 01:30:35,634
drivechain enabling

1147
01:30:35,634 --> 01:30:37,634
you to

1148
01:30:37,634 --> 01:30:39,634
do

1149
01:30:39,634 --> 01:30:41,634
wrapped Bitcoin better?

1150
01:30:41,634 --> 01:30:43,634
How can a drivechain make it

1151
01:30:43,634 --> 01:30:45,634
better than what already exists?

1152
01:30:45,634 --> 01:30:47,634
As I understand,

1153
01:30:47,634 --> 01:30:49,634
Bitcoin works already.

1154
01:30:49,634 --> 01:30:51,634
It's custodial.

1155
01:30:51,634 --> 01:30:53,634
Totally custodial right now.

1156
01:30:53,634 --> 01:30:55,634
So I think Rinda means that

1157
01:30:55,634 --> 01:30:57,634
you could somehow

1158
01:30:57,634 --> 01:30:59,634
create a trustless

1159
01:30:59,634 --> 01:31:01,634
bridge basically and some automatic

1160
01:31:03,634 --> 01:31:05,634
custodial

1161
01:31:05,634 --> 01:31:07,634
contract that issues the wrapped

1162
01:31:07,634 --> 01:31:09,634
Bitcoin or destroys the wrapped Bitcoin

1163
01:31:09,634 --> 01:31:11,634
as you peg out. No?

1164
01:31:11,634 --> 01:31:13,634
Okay, but how is it

1165
01:31:13,634 --> 01:31:15,634
different from like

1166
01:31:15,634 --> 01:31:17,634
the Ethereum sidechain?

1167
01:31:17,634 --> 01:31:19,634
Right now, there's no way...

1168
01:31:19,634 --> 01:31:21,634
Yeah, so there's no way

1169
01:31:21,634 --> 01:31:23,634
on the Ethereum side

1170
01:31:23,634 --> 01:31:25,634
you could validate

1171
01:31:25,634 --> 01:31:27,634
like that Bitcoin

1172
01:31:27,634 --> 01:31:29,634
is locked up on the Bitcoin side and you could

1173
01:31:29,634 --> 01:31:31,634
issue like a ERC-20

1174
01:31:31,634 --> 01:31:33,634
token that

1175
01:31:33,634 --> 01:31:35,634
represents like tokenized Bitcoin

1176
01:31:35,634 --> 01:31:37,634
like on the Ethereum side and you can go use that

1177
01:31:37,634 --> 01:31:39,634
however you want to use whatever other token.

1178
01:31:39,634 --> 01:31:41,634
On the Bitcoin side,

1179
01:31:41,634 --> 01:31:43,634
Bitcoin script is not

1180
01:31:43,634 --> 01:31:45,634
expressive enough to

1181
01:31:45,634 --> 01:31:47,634
let us validate

1182
01:31:47,634 --> 01:31:49,634
something like a token burn

1183
01:31:49,634 --> 01:31:51,634
on the Ethereum side, right?

1184
01:31:51,634 --> 01:31:53,634
That's not what I'm

1185
01:31:53,634 --> 01:31:55,634
saying. What I'm saying is

1186
01:31:55,634 --> 01:31:57,634
if we have an Ethereum sidechain that just

1187
01:31:57,634 --> 01:31:59,634
copies Ethereum

1188
01:31:59,634 --> 01:32:01,634
and we peg in Bitcoin into

1189
01:32:01,634 --> 01:32:03,634
the Ethereum sidechain,

1190
01:32:03,634 --> 01:32:05,634
wouldn't that accomplish the same thing

1191
01:32:05,634 --> 01:32:07,634
as doing the

1192
01:32:07,634 --> 01:32:09,634
trustless

1193
01:32:09,634 --> 01:32:11,634
wrapped Bitcoin? Oh, sure, yeah.

1194
01:32:11,634 --> 01:32:13,634
The point that I was making is that, you know,

1195
01:32:13,634 --> 01:32:15,634
Ethereum has like a whole ecosystem

1196
01:32:15,634 --> 01:32:17,634
of, you know,

1197
01:32:17,634 --> 01:32:19,634
Uniswap is there, there's stablecoin

1198
01:32:19,634 --> 01:32:21,634
issuers on there, there's

1199
01:32:21,634 --> 01:32:23,634
borrow-lend markets with like

1200
01:32:23,634 --> 01:32:25,634
a lot of liquidity, there's

1201
01:32:25,634 --> 01:32:27,634
L2s, there's wallet

1202
01:32:27,634 --> 01:32:29,634
ecosystems, like there's all this ecosystem

1203
01:32:29,634 --> 01:32:31,634
that you're not going to lift onto

1204
01:32:31,634 --> 01:32:33,634
an Ethereum sidechain.

1205
01:32:33,634 --> 01:32:35,634
But the thing is

1206
01:32:35,634 --> 01:32:37,634
all that ecosystem is kind of open source,

1207
01:32:37,634 --> 01:32:39,634
right? Like all the bullets and

1208
01:32:39,634 --> 01:32:41,634
so on, you can also copy them

1209
01:32:41,634 --> 01:32:43,634
along with the sidechain.

1210
01:32:43,634 --> 01:32:45,634
Sure, but like we've

1211
01:32:45,634 --> 01:32:47,634
seen people try that and

1212
01:32:47,634 --> 01:32:49,634
like, you know,

1213
01:32:49,634 --> 01:32:51,634
you have,

1214
01:32:51,634 --> 01:32:53,634
so Paul pointed out some good

1215
01:32:53,634 --> 01:32:55,634
reasons not to

1216
01:32:55,634 --> 01:32:57,634
believe in Rootstock, but like Rootstock

1217
01:32:57,634 --> 01:32:59,634
has kind of done that.

1218
01:32:59,634 --> 01:33:01,634
A more recent example is like PulseChain,

1219
01:33:01,634 --> 01:33:03,634
which is like a Richard Hart

1220
01:33:03,634 --> 01:33:05,634
project,

1221
01:33:05,634 --> 01:33:07,634
I guess is the

1222
01:33:07,634 --> 01:33:09,634
most generous way to put it, right?

1223
01:33:09,634 --> 01:33:11,634
They literally cloned

1224
01:33:11,634 --> 01:33:13,634
the entire

1225
01:33:13,634 --> 01:33:15,634
EVM state

1226
01:33:15,634 --> 01:33:17,634
and just airdropped it into their

1227
01:33:17,634 --> 01:33:19,634
sidechain, and it's not like

1228
01:33:19,634 --> 01:33:21,634
people, you know,

1229
01:33:21,634 --> 01:33:23,634
it's not like everybody went into Metamask

1230
01:33:23,634 --> 01:33:25,634
and said like, alright, fuck it, we're

1231
01:33:25,634 --> 01:33:27,634
pointing at PulseChain now, right?

1232
01:33:27,634 --> 01:33:29,634
Like, moving the software

1233
01:33:29,634 --> 01:33:31,634
doesn't move the liquidity, and

1234
01:33:31,634 --> 01:33:33,634
there's a lot of liquidity and a lot of

1235
01:33:33,634 --> 01:33:35,634
ecosystem there.

1236
01:33:35,634 --> 01:33:37,634
Yeah, right, but

1237
01:33:37,634 --> 01:33:39,634
kind of also the difference

1238
01:33:39,634 --> 01:33:41,634
is that

1239
01:33:41,634 --> 01:33:43,634
this PulseChain is that

1240
01:33:43,634 --> 01:33:45,634
PulseChain doesn't have

1241
01:33:45,634 --> 01:33:47,634
the advantage that Bitcoin has,

1242
01:33:47,634 --> 01:33:49,634
because, you know, Bitcoin

1243
01:33:49,634 --> 01:33:51,634
has the advantage of like larger market

1244
01:33:51,634 --> 01:33:53,634
cap and a very large

1245
01:33:53,634 --> 01:33:55,634
brand, right?

1246
01:33:55,634 --> 01:33:57,634
Things like that, and

1247
01:33:57,634 --> 01:33:59,634
Ethereum has its unique advantage,

1248
01:33:59,634 --> 01:34:01,634
which is like the technology,

1249
01:34:01,634 --> 01:34:03,634
the kind of also its own

1250
01:34:03,634 --> 01:34:05,634
brand, it's separate,

1251
01:34:05,634 --> 01:34:07,634
and like basically with

1252
01:34:07,634 --> 01:34:09,634
an Ethereum sidechain, we copy over

1253
01:34:09,634 --> 01:34:11,634
all the technology and

1254
01:34:11,634 --> 01:34:13,634
take away that advantage.

1255
01:34:13,634 --> 01:34:15,634
And that would be

1256
01:34:15,634 --> 01:34:17,634
just a competition

1257
01:34:17,634 --> 01:34:19,634
between the Bitcoin brand

1258
01:34:19,634 --> 01:34:21,634
with all the Ethereum stuff that does exactly

1259
01:34:21,634 --> 01:34:23,634
the same technology, and between

1260
01:34:23,634 --> 01:34:25,634
the Ethereum brand, which

1261
01:34:25,634 --> 01:34:27,634
also has the exact same technology, but

1262
01:34:27,634 --> 01:34:29,634
actually less, because

1263
01:34:29,634 --> 01:34:31,634
Bitcoin also will have

1264
01:34:31,634 --> 01:34:33,634
its sidechains, right?

1265
01:34:33,634 --> 01:34:35,634
All the other stuff, right?

1266
01:34:35,634 --> 01:34:37,634
Like the thing that I think

1267
01:34:37,634 --> 01:34:39,634
a lot of us

1268
01:34:39,634 --> 01:34:41,634
miss, right, is that

1269
01:34:41,634 --> 01:34:43,634
Ethereum developers, like the people

1270
01:34:43,634 --> 01:34:45,634
who have been building all this technology,

1271
01:34:45,634 --> 01:34:47,634
are all Ethereum bag holders,

1272
01:34:47,634 --> 01:34:49,634
right? Like if you've got a big bag of

1273
01:34:49,634 --> 01:34:51,634
Ethereum and Uniswap token

1274
01:34:51,634 --> 01:34:53,634
and Compound token,

1275
01:34:53,634 --> 01:34:55,634
you're not just going to

1276
01:34:55,634 --> 01:34:57,634
dump all of that,

1277
01:34:57,634 --> 01:34:59,634
because now there's a Compound

1278
01:34:59,634 --> 01:35:01,634
token on Bitcoin,

1279
01:35:01,634 --> 01:35:03,634
right?

1280
01:35:03,634 --> 01:35:05,634
But the insidious

1281
01:35:05,634 --> 01:35:07,634
thing is, because all of the

1282
01:35:07,634 --> 01:35:09,634
software is open source, you can just copy

1283
01:35:09,634 --> 01:35:11,634
absolutely everything they do

1284
01:35:11,634 --> 01:35:13,634
and have exactly the same technology.

1285
01:35:13,634 --> 01:35:15,634
Yeah, sure, but

1286
01:35:15,634 --> 01:35:17,634
that doesn't

1287
01:35:17,634 --> 01:35:19,634
make me bullish on Rootstock

1288
01:35:19,634 --> 01:35:21,634
or on Pulsechain.

1289
01:35:21,634 --> 01:35:23,634
They can lift all that technology

1290
01:35:23,634 --> 01:35:25,634
and replicate it over.

1291
01:35:25,634 --> 01:35:27,634
It doesn't really matter.

1292
01:35:27,634 --> 01:35:29,634
Yeah, that is true,

1293
01:35:29,634 --> 01:35:31,634
but I guess also

1294
01:35:31,634 --> 01:35:33,634
another problem with something like Rootstock

1295
01:35:33,634 --> 01:35:35,634
is, again,

1296
01:35:35,634 --> 01:35:37,634
Rootstock doesn't have

1297
01:35:37,634 --> 01:35:39,634
the advantage that Bitcoin has,

1298
01:35:39,634 --> 01:35:41,634
because Bitcoin is like the oldest

1299
01:35:41,634 --> 01:35:43,634
coin,

1300
01:35:43,634 --> 01:35:45,634
the biggest, right?

1301
01:35:45,634 --> 01:35:47,634
Because if you pair

1302
01:35:47,634 --> 01:35:49,634
being the biggest coin

1303
01:35:49,634 --> 01:35:51,634
with the most investors,

1304
01:35:51,634 --> 01:35:53,634
that's the most known,

1305
01:35:53,634 --> 01:35:55,634
with having exactly the same technology,

1306
01:35:55,634 --> 01:35:57,634
then there's a pretty good chance

1307
01:35:57,634 --> 01:35:59,634
of victory over something like

1308
01:35:59,634 --> 01:36:01,634
Ethereum, even

1309
01:36:01,634 --> 01:36:03,634
though Ethereum also has a pretty strong brand

1310
01:36:03,634 --> 01:36:05,634
and stuff like that.

1311
01:36:05,634 --> 01:36:07,634
I would like to

1312
01:36:07,634 --> 01:36:09,634
just one quick thing.

1313
01:36:09,634 --> 01:36:11,634
So, one thing

1314
01:36:11,634 --> 01:36:13,634
I would really like

1315
01:36:13,634 --> 01:36:15,634
if Bitcoin did its own thing.

1316
01:36:15,634 --> 01:36:17,634
I don't think

1317
01:36:17,634 --> 01:36:19,634
we should just go after

1318
01:36:19,634 --> 01:36:21,634
other chains, because Bitcoin

1319
01:36:21,634 --> 01:36:23,634
has found

1320
01:36:23,634 --> 01:36:25,634
a very unique set of trade-offs

1321
01:36:25,634 --> 01:36:27,634
and it's actually

1322
01:36:27,634 --> 01:36:29,634
comfortable in there.

1323
01:36:29,634 --> 01:36:31,634
And we

1324
01:36:31,634 --> 01:36:33,634
kind of should, instead of copying

1325
01:36:33,634 --> 01:36:35,634
Ethereum

1326
01:36:35,634 --> 01:36:37,635
and Ethereum technology or

1327
01:36:37,635 --> 01:36:39,635
Monero or Zcash and their technology,

1328
01:36:39,635 --> 01:36:41,635
we should do our own thing,

1329
01:36:41,635 --> 01:36:43,635
I believe. So, that's

1330
01:36:43,635 --> 01:36:45,635
also another reason why I'm much more

1331
01:36:45,635 --> 01:36:47,635
interested in Bitcoin clones,

1332
01:36:47,635 --> 01:36:49,635
sidechains, with slightly

1333
01:36:49,635 --> 01:36:51,635
more different capabilities.

1334
01:36:51,635 --> 01:36:53,635
And doing

1335
01:36:53,635 --> 01:36:55,635
privacy and scaling

1336
01:36:55,635 --> 01:36:57,635
mainly on Layer 2s,

1337
01:36:57,635 --> 01:36:59,635
because that's Bitcoin's

1338
01:36:59,635 --> 01:37:01,635
thing, right? That's something

1339
01:37:01,635 --> 01:37:03,635
that we are trying

1340
01:37:03,635 --> 01:37:05,635
to accomplish and

1341
01:37:05,635 --> 01:37:07,635
it makes sense in a lot of

1342
01:37:07,635 --> 01:37:09,635
technical sense.

1343
01:37:09,635 --> 01:37:11,635
And I

1344
01:37:11,635 --> 01:37:13,635
think

1345
01:37:13,635 --> 01:37:15,635
these

1346
01:37:15,635 --> 01:37:17,635
straight-up clones

1347
01:37:17,635 --> 01:37:19,635
of altcoins that made very, very

1348
01:37:19,635 --> 01:37:21,635
different trade-offs,

1349
01:37:21,635 --> 01:37:23,635
I also doubt that they will be very

1350
01:37:23,635 --> 01:37:25,635
successful on Bitcoin.

1351
01:37:25,635 --> 01:37:27,635
Simply because the people

1352
01:37:27,635 --> 01:37:29,635
who remain Bitcoiners and did not go

1353
01:37:29,635 --> 01:37:31,635
over to these altcoins,

1354
01:37:31,635 --> 01:37:33,635
who did not become Robert Monero

1355
01:37:33,635 --> 01:37:35,635
or Zcash or

1356
01:37:35,635 --> 01:37:37,635
Ethereum fans, are the

1357
01:37:37,635 --> 01:37:39,635
people who like this approach

1358
01:37:39,635 --> 01:37:41,635
generally and

1359
01:37:41,635 --> 01:37:43,635
like these

1360
01:37:43,635 --> 01:37:45,635
unique characteristics.

1361
01:37:45,635 --> 01:37:47,635
And

1362
01:37:47,635 --> 01:37:49,635
maybe we should just have more of that.

1363
01:37:49,635 --> 01:37:51,635
That's my two cents.

1364
01:37:51,635 --> 01:37:53,635
Yes, well said. I just wanted to

1365
01:37:53,635 --> 01:37:55,635
very quickly say, in agreement

1366
01:37:55,635 --> 01:37:57,635
with what WetHardware was saying,

1367
01:37:57,635 --> 01:37:59,635
and in response to your excellent

1368
01:37:59,635 --> 01:38:01,635
thoughts, Reindahl, regarding

1369
01:38:01,635 --> 01:38:03,635
network effects, imagine

1370
01:38:03,635 --> 01:38:05,635
not Ethereum as the

1371
01:38:05,635 --> 01:38:07,635
competitor to Bitcoin, but

1372
01:38:07,635 --> 01:38:09,635
just Zcash or Monero.

1373
01:38:09,635 --> 01:38:11,635
Their market caps

1374
01:38:11,635 --> 01:38:13,635
are just $1 or $2 billion.

1375
01:38:13,635 --> 01:38:15,635
Therefore, if

1376
01:38:15,635 --> 01:38:17,635
only 1%

1377
01:38:17,635 --> 01:38:19,635
of Bitcoiners sent Bitcoin

1378
01:38:19,635 --> 01:38:21,635
to a privacy sidechain,

1379
01:38:21,635 --> 01:38:23,635
it would be a $4 billion market

1380
01:38:23,635 --> 01:38:25,635
cap sidechain with, presumably,

1381
01:38:25,635 --> 01:38:27,635
high fees, or at least as

1382
01:38:27,635 --> 01:38:29,635
much as

1383
01:38:29,635 --> 01:38:31,635
Monero or Zcash. So there would be

1384
01:38:31,635 --> 01:38:33,635
some security. There would be a significant

1385
01:38:33,635 --> 01:38:35,635
market cap. It would begin to have network

1386
01:38:35,635 --> 01:38:37,635
effects and privacy

1387
01:38:37,635 --> 01:38:39,635
that rivals or exceeds

1388
01:38:39,635 --> 01:38:41,635
those altcoins. So therefore,

1389
01:38:41,635 --> 01:38:43,635
maybe

1390
01:38:43,635 --> 01:38:45,635
utility-focused users on those altcoins,

1391
01:38:45,635 --> 01:38:47,635
not the ones gambling on the

1392
01:38:47,635 --> 01:38:49,635
token, but holding it for the utility

1393
01:38:49,635 --> 01:38:51,635
and transacting privately, they

1394
01:38:51,635 --> 01:38:53,635
would move over to Bitcoin

1395
01:38:53,635 --> 01:38:55,635
to use this privacy

1396
01:38:55,635 --> 01:38:57,635
sidechain. And then, that would be the first

1397
01:38:57,635 --> 01:38:59,635
example, maybe, of Bitcoin

1398
01:38:59,635 --> 01:39:01,635
absorbing the value in users

1399
01:39:01,635 --> 01:39:03,635
of an altcoin. And if we do that

1400
01:39:03,635 --> 01:39:05,635
one by one, absorbing

1401
01:39:05,635 --> 01:39:07,635
the value in users and technology

1402
01:39:07,635 --> 01:39:09,635
of the altcoins focused

1403
01:39:09,635 --> 01:39:11,635
on things that aren't offered

1404
01:39:11,635 --> 01:39:13,635
on Bitcoin presently, then Bitcoin would

1405
01:39:13,635 --> 01:39:15,635
begin to have a greater

1406
01:39:15,635 --> 01:39:17,635
and greater network effect

1407
01:39:17,635 --> 01:39:19,635
more than it already has against

1408
01:39:19,635 --> 01:39:21,635
Ethereum, and would eventually

1409
01:39:21,635 --> 01:39:23,635
swallow up even its largest competitor.

1410
01:39:29,950 --> 01:39:31,390
You want to say something? I want to say something.

1411
01:39:31,390 --> 01:39:32,750
Yeah, Reindahl, what do you think of that?

1412
01:39:32,750 --> 01:39:39,630
Well, just really quick. I mean, because of this whole thing, I'm skeptical of the whole

1413
01:39:40,510 --> 01:39:48,990
Bitcoin will make alts go to zero. I think the real value of sidechains is that we can do higher

1414
01:39:48,990 --> 01:39:53,470
throughput, more private payments. It seems like the reason why people use Bitcoin is because it's

1415
01:39:53,470 --> 01:40:02,830
better money. And so, I think we can build better money capabilities on sidechains. And that might

1416
01:40:02,830 --> 01:40:12,749
be like, hey, let's get some 10,000 TPS plus perfect privacy payment system as a sidechain

1417
01:40:12,749 --> 01:40:22,030
or some other L2. And the NFT stuff, we just settle on, yeah, there's a better bridge from

1418
01:40:22,030 --> 01:40:28,350
Bitcoin to that thing. But that thing is on some other network that has its own established network

1419
01:40:28,350 --> 01:40:35,470
effects, and we just try to live with it. Well, I think it's all related because the

1420
01:40:35,470 --> 01:40:39,710
topic of creation, really, which is like those things probably wouldn't have been created if

1421
01:40:39,710 --> 01:40:48,670
there was some other outlet. But I think I wanted to go to the topic of Monero and ETH, which are

1422
01:40:49,070 --> 01:40:56,269
if you use a certain lens, like I re-watched the Theranos documentary, because someone did a

1423
01:40:56,269 --> 01:41:01,229
funny Bitcoin parody thread that I liked, and I was like, oh, Theranos, what a great story.

1424
01:41:02,189 --> 01:41:07,869
But anyway, if you do, then you can see part of what's going on with ETH, like we were talking

1425
01:41:07,869 --> 01:41:15,070
about before, the ETH bag holders, it speaks to the ability of capitalism to align all these

1426
01:41:15,070 --> 01:41:22,750
people, you know, Tim Draper, General Mattis, all these people, like huge numbers of people

1427
01:41:22,750 --> 01:41:27,629
all working together, they're all on the same team, that lawyer they bought off with stock,

1428
01:41:28,269 --> 01:41:33,869
and they are all aligned. So this is the enterprising power of capitalism, even when

1429
01:41:33,869 --> 01:41:39,629
the product doesn't work at all. And it's kind of like, you know, so this is like, you can get all

1430
01:41:39,629 --> 01:41:44,749
these people, they can buy a big office, they can have technicians, people will quit Stanford

1431
01:41:45,629 --> 01:41:50,590
to work there, and they are all aligned on the same mission of making the company a success,

1432
01:41:50,590 --> 01:41:57,549
they're all cooperating. And this, I think it speaks to a virtue of capitalism and a virtue of

1433
01:41:57,549 --> 01:42:05,469
finance and of, you know, corporation, that it can do this type of thing. But of course,

1434
01:42:06,430 --> 01:42:11,870
the thing is Monero is being used on the darknet markets today. And this is like,

1435
01:42:11,870 --> 01:42:17,070
the problem with Theranos is, it didn't actually collide with any people who are actually using it

1436
01:42:17,070 --> 01:42:22,029
for its actual features. A lot of people liked him like associated with it or whatever. But it

1437
01:42:22,029 --> 01:42:26,350
was supposed to be like testing people's blood. At the end of the day, push comes to shove,

1438
01:42:26,350 --> 01:42:30,029
and you have to actually do something. And the reason why I always bring up the darknet markets

1439
01:42:30,029 --> 01:42:36,590
is just because it was kind of like Bitcoin's first big break, so to speak, and it switched

1440
01:42:36,590 --> 01:42:42,189
from being whatever they were doing before to Bitcoin only was like prepaid cards or whatever,

1441
01:42:42,189 --> 01:42:48,109
and it was nothing. And then Ross Albright and Silk Road made it with Bitcoin. And then now it's

1442
01:42:48,109 --> 01:42:54,189
Monero only. And when you think of that, that kind of to me seems almost like what you might call

1443
01:42:54,189 --> 01:42:59,230
like real sales, for lack of a better way of putting it. Those are like the actual circuit

1444
01:42:59,230 --> 01:43:04,430
has been completed. And that's how you know that you're doing. Because the thing is, you don't know

1445
01:43:05,389 --> 01:43:09,950
you're working for Theranos, like you're in a cult. How do you know that you're in a cult?

1446
01:43:10,590 --> 01:43:17,310
Everyone around you, they say you're not in a cult. It doesn't seem like you're in a cult from

1447
01:43:17,310 --> 01:43:24,430
the inside. So how do you know? Because it often looks exactly the same inside and outside. And so

1448
01:43:24,430 --> 01:43:30,109
this is like, in one sense, you can view the Ethereum through this lens and say, aha,

1449
01:43:30,749 --> 01:43:36,269
just because it's so popular doesn't mean it will succeed. It has all this stuff, but that's just

1450
01:43:36,269 --> 01:43:42,109
people pumping their own bags. But then you can also look at Bitcoin through that lens and say,

1451
01:43:43,469 --> 01:43:50,590
why has Bitcoin left the darknet markets? Bitcoin is the, you know, then in that sense,

1452
01:43:50,590 --> 01:43:56,750
you could say Bitcoin is the Theranos. Yeah, Paul, I completely like, I love that analogy.

1453
01:43:57,549 --> 01:44:03,310
I want to give you another example that I think is hitting on the same point, but is maybe a more

1454
01:44:03,310 --> 01:44:09,150
recent example, which is the Canadian trucker protest last year. Right. So, you know, like

1455
01:44:09,710 --> 01:44:16,590
people speculate on Bitcoin. I would argue that the number one actual use of Bitcoin is speculation.

1456
01:44:16,590 --> 01:44:21,229
Most people don't actually use Bitcoin as a tool. They use it as a speculative vehicle.

1457
01:44:21,229 --> 01:44:25,310
And there's a lot of speculative narratives for Bitcoin. And I think one of the

1458
01:44:26,190 --> 01:44:33,870
most compelling is that it's a hedge or it's a tool to circumvent like oppressive censorship

1459
01:44:33,870 --> 01:44:39,470
or oppressive regulation. And when push came to shove, when like the rubber met the road,

1460
01:44:39,470 --> 01:44:44,190
there was a group of people that were being oppressed financially by their government,

1461
01:44:44,269 --> 01:44:50,910
and they needed a way to get money. And, you know, like you can go on Twitter or go on podcasts

1462
01:44:50,910 --> 01:44:55,549
all day and talk about like the way to send Bitcoin privately, the way to receive Bitcoin

1463
01:44:55,549 --> 01:45:00,269
privately, the way to use Bitcoin to like circumvent like government tyranny. And at

1464
01:45:00,269 --> 01:45:05,870
the end of the day, like there's a video online of Caribou like handing paper wallets through

1465
01:45:05,870 --> 01:45:10,990
truck windows to people because like that was like the best way that he could figure out to do it.

1466
01:45:10,990 --> 01:45:15,949
Right. And so like there's all this like speculation about like Bitcoin being able

1467
01:45:15,949 --> 01:45:20,669
to do all of these things. And when the rubber met the road, like somebody needed to use the tool

1468
01:45:21,310 --> 01:45:26,030
and they use the tool the best way that they could figure out how. And then like people got

1469
01:45:26,030 --> 01:45:30,750
really mad about it because it didn't live up to like the ideals of Bitcoin. And maybe that's like

1470
01:45:31,389 --> 01:45:36,430
not his fault. Maybe that's like the fault of kind of the Bitcoin ecosystem. And I think that

1471
01:45:36,910 --> 01:45:45,630
it's kind of a similar thing of, you know, when you have a detachment between like the actual

1472
01:45:45,630 --> 01:45:52,750
utility of a tool and like the narrative of a tool, then you end up having some like dissonance

1473
01:45:52,750 --> 01:45:59,150
between like actual value and perceived value. And I think you see that with darknet markets,

1474
01:45:59,150 --> 01:46:02,990
like moving away from Bitcoin. I think you see that with like Canadian truckers, like

1475
01:46:02,990 --> 01:46:06,109
having trouble receiving Bitcoin. I think there's like a number of places.

1476
01:46:06,669 --> 01:46:12,269
And the solution to that is probably not to get more religious and more sanctimonious

1477
01:46:12,829 --> 01:46:17,630
about like Bitcoin's immaculate conception and like monetary properties. It's probably to like

1478
01:46:18,190 --> 01:46:20,349
actually figure out how to make Bitcoin be a better tool.

1479
01:46:22,349 --> 01:46:22,990
Yeah.

1480
01:46:22,990 --> 01:46:28,669
Should we talk for a bit about funder? Maybe we should discuss. Pardon?

1481
01:46:29,789 --> 01:46:31,069
I just said it's 100% correct.

1482
01:46:31,630 --> 01:46:36,030
Yes. Well said, Reindahl. Thank you. Maybe we should talk about funder,

1483
01:46:36,030 --> 01:46:41,150
because Reindahl and Moon Settler both have mentioned today or in other conversations,

1484
01:46:41,150 --> 01:46:47,470
as I recall, that they of all possible drivechain applications, the most exciting side

1485
01:46:47,470 --> 01:46:53,229
chain to them might be a clone of Bitcoin with larger blocks to enhance Bitcoin's ability to

1486
01:46:53,229 --> 01:47:00,750
scale and onboard billions of people rapidly in a level of fees and decentralization that

1487
01:47:00,829 --> 01:47:06,349
they prefer to opt into, in addition to having main chain Bitcoin as an option.

1488
01:47:07,310 --> 01:47:08,910
Maybe we should talk about funder a bit.

1489
01:47:09,949 --> 01:47:17,310
And I keep repeating this, but I don't actually believe in one gigabyte block sidechains. So

1490
01:47:17,310 --> 01:47:23,389
I don't think we need to go crazy with that. What we can do with these sidechains is be a little

1491
01:47:23,389 --> 01:47:33,949
bit more bored with stuff like covenants and maybe not only be more free to use near and below

1492
01:47:33,949 --> 01:47:41,150
dust amounts on the sidechain than on main chain, it would be possible, but also we could

1493
01:47:41,150 --> 01:47:50,349
have more expressive covenants and we could have excellent wallets like what ARK aims to be.

1494
01:47:50,349 --> 01:47:57,150
So ARK is really giving us scaling and privacy, hopefully, and just an overall better wallet

1495
01:47:57,150 --> 01:48:03,870
experience than anything even on chain could give us, because the way ARK works is it's almost

1496
01:48:03,870 --> 01:48:11,469
giving you instant finality, not quite, but at least it is atomic. So it gives you instant zero

1497
01:48:11,469 --> 01:48:19,229
conf atomicity, at least I can say that with very good game theoretical guarantees. And that means

1498
01:48:19,229 --> 01:48:25,789
that just doing ARK on a sidechain where you don't have to worry about being able to enforce

1499
01:48:25,789 --> 01:48:34,349
your property rights on chain, that is a completely different ballgame. And I would very much like to

1500
01:48:34,349 --> 01:48:42,589
see more of that than straight up copying altcoins and trying to somehow make their weird trade-offs

1501
01:48:42,589 --> 01:48:49,070
work, like we are not sure that Monero is going to scale at all, we are not sure if their privacy

1502
01:48:49,070 --> 01:48:58,909
is actually standing up to reasonable statistical analysis type of things, it very much looks like

1503
01:48:58,909 --> 01:49:06,909
it won't. And there is a whole host of reasons why we should actually omit as much data optimistically

1504
01:49:06,909 --> 01:49:15,950
as possible from the chains, and actually keep the stuff just very difficult to trace or observe

1505
01:49:15,950 --> 01:49:24,589
by keeping this state of chain, and having stat addresses by default basically, ARK gives you

1506
01:49:25,390 --> 01:49:31,469
an address that you can receive coins to, but nobody actually sees coins being received to

1507
01:49:31,469 --> 01:49:39,310
that address, not in the coin joins, not on chain, so you get all the good trade-offs,

1508
01:49:39,310 --> 01:49:47,390
all the good wallet experience, and the only downside that ARK really has is this future

1509
01:49:47,390 --> 01:49:54,589
Bitcoin main chain fee marketing, and if you have a suitable solution to that, I think that alone

1510
01:49:54,589 --> 01:50:02,510
will be just a huge giant leap forward, and you would have basically a wallet that is lightning

1511
01:50:02,510 --> 01:50:08,669
interoperable, almost as probably as good a UX as a custodial lightning wallet is today,

1512
01:50:08,669 --> 01:50:14,349
so you have this very very good UX, you are not in custody, you are private,

1513
01:50:14,349 --> 01:50:21,469
you have stat address, nobody can really observe you efficiently, effectively, so that is what we

1514
01:50:21,469 --> 01:50:26,190
should be aiming for, and this whole thing is compatible with Bitcoin's UTXO model, and the way

1515
01:50:26,190 --> 01:50:31,630
it operates, and the trust model, and I think we should do more of that, that's what I wanted to say,

1516
01:50:31,630 --> 01:50:39,469
so not even all that sold on people actually doing on-chain transactions on the plane,

1517
01:50:39,469 --> 01:50:47,950
on the sidechain, right, it can just be a fallback. Yeah, I agree that actually,

1518
01:50:48,830 --> 01:50:55,310
like in the post, the idea is actually not to have like one large block sidechain, it's to have like

1519
01:50:55,950 --> 01:51:03,149
a bunch of geographically distributed, like 10 or so that each start at like 8 megabytes or

1520
01:51:03,149 --> 01:51:10,029
something small, and then they grow geometrically to like 800 megabytes over 10 years or something,

1521
01:51:10,589 --> 01:51:14,750
you know, you start off with one, and then when that one fills up, you start the second one,

1522
01:51:14,750 --> 01:51:18,669
so it's kind of like a combination of ideas, but it's true at the very end of the appendix, I do

1523
01:51:19,310 --> 01:51:26,029
the math on what a one gigabyte block size node would cost, but I kind of only do that to just

1524
01:51:26,029 --> 01:51:30,909
show, I was kind of trying to put like, because people have this like abstract fear, I mean first

1525
01:51:30,909 --> 01:51:36,430
of all, there's a night and day difference between layer one blocks, like large blocks on layer one

1526
01:51:36,430 --> 01:51:42,349
mandatory, which is a big mistake, and optional layer two large block, and the fact that it's

1527
01:51:42,349 --> 01:51:47,469
optional is all the difference, you know, it's the difference between being in a food court where you

1528
01:51:47,469 --> 01:51:54,190
can pick any food, or just leave or no food, and being in prison, you know, it's a big difference.

1529
01:51:54,190 --> 01:52:00,029
We should also point out that the post that Paul is talking about is now in the nest,

1530
01:52:00,029 --> 01:52:04,669
that LayerTwo Labs tweet where it says thunder can be the future, if you open that tweet and

1531
01:52:04,669 --> 01:52:15,310
click on the link, you'll get to the github. Yeah, so some people, you know, prison food is very

1532
01:52:15,310 --> 01:52:21,149
low quality, but some people really like cheap, super cheap cheap McDonald's food, or microwave

1533
01:52:22,029 --> 01:52:26,270
food, you know, they like that, so there's a difference between having the option and being

1534
01:52:26,270 --> 01:52:32,029
forced to do it, and the idea is not just one gigabyte, even though I think it's sometimes

1535
01:52:32,029 --> 01:52:36,909
described that way, but it's kind of silly, but anyway, I completely agree with you that

1536
01:52:38,430 --> 01:52:46,589
we, well, I think the way I frame it is, the way I see it is actually very different. The way I view it is

1537
01:52:47,549 --> 01:52:51,709
you join a team when you, when you show up on Bitcoin, you join like the Bitcoin team,

1538
01:52:52,430 --> 01:52:57,070
and then the team ends up having like disputes, and it's kind of like we have like in the United

1539
01:52:57,070 --> 01:53:02,349
States, we have like the Supreme Court, or we have whatever, you know, we have some way of resolving

1540
01:53:02,349 --> 01:53:09,469
the dispute, and so to me, it's something like there was a block size dispute, some people wanted larger

1541
01:53:09,469 --> 01:53:16,270
blocks, other people did not, and so that's where the sidechain comes in. It says we can accommodate

1542
01:53:17,229 --> 01:53:24,909
some of your dispute, not all the time, not always, whatever, so what I would really say is that we

1543
01:53:24,909 --> 01:53:30,349
should have like, there should be like a Roger Ver chain and a Moon Settler chain, or whatever,

1544
01:53:30,349 --> 01:53:36,830
where the Moon Settler chain is like 10 megabytes with BIP119, or with whatever, OP_VAULT,

1545
01:53:38,830 --> 01:53:43,950
and then there's the Roger Ver one, it's just not like that. It should just be, because it's like,

1546
01:53:43,950 --> 01:53:50,190
what do we really get by turning people away? Unfortunately, in the Bitcoin culture, you

1547
01:53:50,190 --> 01:53:57,789
can rise on the totem pole by being like, extremely inconsiderate, and you know,

1548
01:53:59,469 --> 01:54:09,469
basically throwing this attitude of smug complacency, but we don't, it's not actually

1549
01:54:09,469 --> 01:54:13,310
good, it's only good for you, that's not actually good for Bitcoin. What's good for Bitcoin is more

1550
01:54:13,310 --> 01:54:17,310
people using Bitcoin, more people owning Bitcoin, more people talking about Bitcoin,

1551
01:54:18,109 --> 01:54:23,950
more people just giving up on rivals to Bitcoin, including fiat currencies, so that is the,

1552
01:54:25,709 --> 01:54:30,510
we don't, we want the coalition to just grow forever, so if we have, we hit the dispute number

1553
01:54:30,510 --> 01:54:37,229
one, and it's, we want larger blocks, then we give people larger blocks, and then years later, in 2023,

1554
01:54:37,229 --> 01:54:42,589
we hit a new dispute, and Jeremy Rubin wants 119, or whatever, and other people don't,

1555
01:54:43,310 --> 01:54:48,669
we split that off, and that's how I see it, I see it as a very human thing, I see it as going from

1556
01:54:48,669 --> 01:54:56,830
like, dispute to dispute. And there is one more thing that I have tried to explain, I have this

1557
01:54:56,830 --> 01:55:05,630
intuition that if like, Bitcoin has, you know, we go with this whole remnant lot, and there is like,

1558
01:55:06,589 --> 01:55:11,709
let's say, 1% of humanity tops, that is a hardcore Bitcoiner, and everyone is

1559
01:55:12,589 --> 01:55:20,349
their servants, and serves, and whatever, I don't know, these fantasies are weird, so in that world,

1560
01:55:21,070 --> 01:55:27,310
you know, I think history shows that not even a 10% minority is really protected, and

1561
01:55:27,310 --> 01:55:32,430
shit is the fun, and someone is there to blame, and someone is doing better than the rest, and

1562
01:55:33,310 --> 01:55:40,669
it's just not a good position to be, because it's almost certainly guaranteed that there will be a

1563
01:55:40,669 --> 01:55:46,270
witch hunt, and these people will be somehow blamed for everything, from climate change to

1564
01:55:46,909 --> 01:55:52,510
whatever political, economical shitstorm that they managed to weather, better than the rest

1565
01:55:52,510 --> 01:56:00,109
of the population, so a 1% minority is just as good as dead, a 10% minority is still something

1566
01:56:00,190 --> 01:56:07,549
that historically, you know, easily fall victim to the majority, when it comes to

1567
01:56:08,510 --> 01:56:13,469
interfering, and someone to blame, but when everyone is a Bitcoiner, although almost everyone

1568
01:56:13,469 --> 01:56:18,830
is a Bitcoiner, it's just political suicide to, you know, single out Bitcoiners, and go after

1569
01:56:18,830 --> 01:56:25,469
them, that's how I also see this whole remnant versus big tent thing, that it actually makes

1570
01:56:25,469 --> 01:56:28,830
sense out of self-interest, you would want everyone to be a Bitcoiner.

1571
01:56:39,150 --> 01:56:42,670
Paul, perhaps you'd like to respond to a very interesting tweet

1572
01:56:42,670 --> 01:56:47,309
from Rijndael, I put in the nest. Okay, maybe I will, do we have a new speaker?

1573
01:56:48,109 --> 01:56:50,109
Yes, we do. Hello, Bitcode.

1574
01:56:50,910 --> 01:56:59,069
Yeah, hi guys. Thank you, Paul, for doing this, what you are doing, this is the

1575
01:57:00,109 --> 01:57:09,550
most exciting project on Bitcoin, and I can tell you that I'm so excited that I discovered

1576
01:57:10,109 --> 01:57:19,229
the drivechains, because I'm 14 years in this space, for a long time, and,

1577
01:57:21,069 --> 01:57:28,349
you know, I listened to what you were saying, and I agree with you, and I want to say that,

1578
01:57:29,069 --> 01:57:37,309
for me, what you are doing is the only way that we preserve the decentralization of the Bitcoin,

1579
01:57:38,030 --> 01:57:45,229
because, actually, you created something that does not affect the main chain,

1580
01:57:45,949 --> 01:57:54,270
but uses the same, the same, everything the same, what Bitcoin uses, so it's very good. I mean,

1581
01:57:54,270 --> 01:58:02,349
like, I tried the drivechains core, I ran it, I mined some drivechain tokens,

1582
01:58:03,150 --> 01:58:09,469
and I have some questions, so I get more, more knowledge about this, and I'm planning to do

1583
01:58:10,429 --> 01:58:19,469
my spaces with some other people, because I was working on, to create some sidechain. Actually,

1584
01:58:19,469 --> 01:58:27,949
our reason for creating, or trying to create sidechain is to bring everything back to Bitcoin.

1585
01:58:28,829 --> 01:58:35,150
Yes, well said. Thank you very much for those very warm comments. It's great that you're involved.

1586
01:58:35,150 --> 01:58:38,349
Welcome, David, to the stage. David Bailey.

1587
01:58:38,349 --> 01:58:47,709
What's up? Very bullish on BIP300. Very excited about what LayerTwo Labs is doing.

1588
01:58:47,709 --> 01:58:53,390
Whoa, hold on. Dave Bailey, I just want to say that I appreciate your mom.

1589
01:58:54,589 --> 01:58:55,949
Can we leave my mom out of this, please?

1590
01:58:56,910 --> 01:58:57,390
Yes.

1591
01:58:59,949 --> 01:59:05,550
So, this space is strictly for the kids, okay? This is strictly for the kids.

1592
01:59:07,390 --> 01:59:14,990
So, LayerTwo Labs, just my only question is, for people that are diehard fans of BIP300,

1593
01:59:14,990 --> 01:59:20,349
how can we support LayerTwo Labs? How can we make BIP300 happen? What is a positive,

1594
01:59:20,349 --> 01:59:23,550
value-adding action for people in the spaces to go do right now?

1595
01:59:25,949 --> 01:59:31,069
So, it turns out you need to make hats, and you need to wear them, and be very loud.

1596
01:59:31,306 --> 01:59:38,306
Some of the things you can do include joining a Telegram group, downloading our software at layer2labs.com,

1597
01:59:38,306 --> 01:59:46,306
and talking about it at your local BitDevs meetup, and sharing it with your friends and fellow Bitcoiners,

1598
01:59:46,306 --> 01:59:52,306
and especially running our software, as I mentioned, at layer2labs.com. Paul, what else would you mention?

1599
01:59:52,306 --> 01:59:58,306
Software is a really good way to learn more, but if you feel you have learned enough,

1600
01:59:58,306 --> 02:00:05,306
then I think just the important thing is to, I think, just keep the idea in the conversation.

1601
02:00:05,306 --> 02:00:12,306
We're going to have a new, soon we'll have a sidechain that is just Bitcoin Core version 25,

1602
02:00:12,306 --> 02:00:18,306
and we'll just add BIP119, 118, OPVALT, or whatever, into the sidechain so people can play around with it.

1603
02:00:19,306 --> 02:00:28,306
So, let me give you an example of, it's well known that in Bitcoin Core development,

1604
02:00:28,306 --> 02:00:35,306
things will not get merged unless they have overwhelming, there can't really be any controversy,

1605
02:00:35,306 --> 02:00:41,306
or even any kind of, they're very conflict avoidant over there.

1606
02:00:41,306 --> 02:00:49,306
So, I think anything that people can do to, if someone is a critic, then we'll send the critic over into the space.

1607
02:00:49,306 --> 02:00:55,306
That would be good. Send all the critics into space so we can talk it out and figure out what they are up to,

1608
02:00:55,306 --> 02:01:02,306
but other than that, just keep the idea in mind. Keep in mind this vision of Bitcoin,

1609
02:01:02,306 --> 02:01:06,306
like don't give up on the vision of Bitcoin replacing every single transaction in the world,

1610
02:01:06,306 --> 02:01:10,306
every altcoin transaction, every fiat transaction.

1611
02:01:10,306 --> 02:01:20,306
I think we have to push back a little on the complacency narrative, the idea that Bitcoin has already won.

1612
02:01:20,306 --> 02:01:24,306
We have to push back on that idea because that's not the case.

1613
02:01:24,306 --> 02:01:28,306
Bitcoin hasn't won until there are no more fiat currencies.

1614
02:01:28,306 --> 02:01:34,306
So, until then, we have to keep working hard to make Bitcoin a success.

1615
02:01:34,306 --> 02:01:38,306
I think one thing, the toxicity has to be handled a certain way.

1616
02:01:38,306 --> 02:01:43,306
People should just keep, there's such a, so many people will send me a message and say,

1617
02:01:43,306 --> 02:01:47,306
oh, I privately think this, but I'm not comfortable saying it out loud.

1618
02:01:47,306 --> 02:01:55,306
The more people who say it out loud, then the more you'll realize that a lot of other people feel the same way as you.

1619
02:01:55,306 --> 02:02:02,306
A recent, one thing that we just talked about was the whole idea that if someone has an idea,

1620
02:02:03,306 --> 02:02:06,306
they're told not to do it in Bitcoin, they're told do it on an altcoin,

1621
02:02:06,306 --> 02:02:09,306
and that once someone does it on an altcoin, they're told,

1622
02:02:09,306 --> 02:02:13,306
well, we're not even going to look at your altcoin because, you know, you're a shit-coiner.

1623
02:02:13,306 --> 02:02:18,306
So, like, there's no real path for, like, new ideas to take.

1624
02:02:18,306 --> 02:02:21,306
So, I just keep all this in mind and just bring it up.

1625
02:02:21,306 --> 02:02:25,306
I mean, Bitcoin, it has people who disagree.

1626
02:02:25,306 --> 02:02:28,306
We've had people who disagreed about the block size.

1627
02:02:28,306 --> 02:02:30,306
We've had people who disagreed about privacy.

1628
02:02:30,306 --> 02:02:33,306
Some people don't even want, some people want ZK-proof privacy,

1629
02:02:33,306 --> 02:02:37,306
but other people, they don't even want that because it interferes with the 21 million coin limit.

1630
02:02:37,306 --> 02:02:42,306
So, Bitcoin has all these disagreements, and that is what the sidechain idea is really about.

1631
02:02:42,306 --> 02:02:44,306
What is a tangible thing people can do?

1632
02:02:44,306 --> 02:02:47,306
You know, one thing, if you have a really, if you write a really great tweet,

1633
02:02:47,306 --> 02:02:53,306
we will add it to our, we'll add it to the layer2labs.com slash friends list.

1634
02:02:53,306 --> 02:02:54,306
We have a huge list.

1635
02:02:54,306 --> 02:02:58,306
Maybe we should put that, I don't know if we have that in the giant nest,

1636
02:02:58,306 --> 02:02:59,306
which is huge now.

1637
02:02:59,306 --> 02:03:00,306
It has millions of tweets.

1638
02:03:00,306 --> 02:03:04,306
But if you have a good tweet, then we will add you.

1639
02:03:04,306 --> 02:03:07,306
We'll find you because you can see it in public on Twitter.

1640
02:03:07,306 --> 02:03:09,306
You write a great tweet, and the better it is,

1641
02:03:09,306 --> 02:03:14,306
we sort the list based on how influential we think you are and how great the tweet is.

1642
02:03:14,306 --> 02:03:15,306
Yeah.

1643
02:03:15,306 --> 02:03:18,306
Basically, if anyone tweets that they support Drivechain,

1644
02:03:18,306 --> 02:03:22,306
if they're, especially if they're in the technical community, like Rheindel,

1645
02:03:22,306 --> 02:03:26,306
then I would add their tweet within seconds to my collection,

1646
02:03:26,306 --> 02:03:30,306
that public list of the favorable comments.

1647
02:03:30,306 --> 02:03:34,306
Because one thing that's very exciting that's happening right now is

1648
02:03:34,306 --> 02:03:41,306
LayerTwo Labs has retained an expert Bitcoin developer with tons of experience

1649
02:03:41,306 --> 02:03:42,306
to rebase the code.

1650
02:03:42,306 --> 02:03:44,306
So never before this has happened,

1651
02:03:44,306 --> 02:03:48,306
where never before has there been a pull request to Bitcoin Core

1652
02:03:48,306 --> 02:03:51,306
to merge the Drivechain code into Bitcoin.

1653
02:03:51,306 --> 02:03:54,306
So this request will come in the coming months, probably.

1654
02:03:55,306 --> 02:04:01,306
And then the community will really have the opportunity to take the final step

1655
02:04:01,306 --> 02:04:02,306
of including it or not.

1656
02:04:02,306 --> 02:04:06,306
And it'll be developers and technical community members like Rheindel,

1657
02:04:06,306 --> 02:04:10,306
Moonsettler, and others who will do that discussion.

1658
02:04:10,306 --> 02:04:15,306
But they need the support and encouragement of the whole community

1659
02:04:15,306 --> 02:04:19,306
who can understand Drivechain conceptually

1660
02:04:19,306 --> 02:04:23,306
and understand that it could really alter the narratives and potential of Bitcoin.

1661
02:04:23,306 --> 02:04:26,306
So they need the support of the whole community

1662
02:04:26,306 --> 02:04:30,306
so that they can feel comfortable with the overall concept of Drivechain.

1663
02:04:32,306 --> 02:04:34,306
Cool. Well, I have to bounce for a call.

1664
02:04:34,306 --> 02:04:36,306
But, Bruce, I'm curious,

1665
02:04:36,306 --> 02:04:39,306
how amazing of an idea do you think BIP300 is?

1666
02:04:39,306 --> 02:04:43,306
From a scale of an amazing idea to a really outstanding idea,

1667
02:04:43,306 --> 02:04:45,306
where do you fall on that spectrum?

1668
02:04:45,306 --> 02:04:48,306
I'm going to say 10 out of 10. I think it's awesome.

1669
02:04:48,306 --> 02:04:53,306
I mean, I've been saying for a long, long time,

1670
02:04:53,306 --> 02:04:57,306
I'm really interested in a couple of things.

1671
02:04:57,306 --> 02:04:59,306
One thing is Bitcoin and money,

1672
02:04:59,306 --> 02:05:01,306
and that it can be the best money in the world.

1673
02:05:01,306 --> 02:05:04,306
And it's sound money and everything that you all know well.

1674
02:05:04,306 --> 02:05:09,306
But I've also always felt that there's a use of distributed ledger technology

1675
02:05:09,306 --> 02:05:11,306
for things like security, because I come from securities.

1676
02:05:11,306 --> 02:05:13,306
And I know how crappy it is.

1677
02:05:13,306 --> 02:05:17,306
And it takes like a week to move a security from one person to another.

1678
02:05:17,306 --> 02:05:19,306
And the old clunky system, which is kind of based on paper,

1679
02:05:19,306 --> 02:05:22,306
that later became digitized, it's all centralized and goofy.

1680
02:05:22,306 --> 02:05:24,306
But like Litecoin doesn't work that way,

1681
02:05:24,306 --> 02:05:26,306
or Ordinal doesn't work that way.

1682
02:05:26,306 --> 02:05:29,306
An NFT on top of Bitcoin doesn't work that way.

1683
02:05:29,306 --> 02:05:31,306
You can send it. So I'm convinced that's going to happen.

1684
02:05:31,306 --> 02:05:34,306
And I've also, like, I've thought this for a long time,

1685
02:05:34,306 --> 02:05:40,306
but even though I'm more friendly to altcoins than some other Bitcoiners,

1686
02:05:40,306 --> 02:05:43,306
but I'm not confident in them enough to build.

1687
02:05:43,306 --> 02:05:45,306
I think there's a lot of shakiness.

1688
02:05:45,306 --> 02:05:48,306
And I do believe that proof of work is the best method

1689
02:05:48,306 --> 02:05:51,306
and that Bitcoin is by far the strongest chain.

1690
02:05:51,306 --> 02:05:54,306
And there's just so many crappy, goofy things that happen in our industry,

1691
02:05:54,306 --> 02:05:56,306
as we all well know.

1692
02:05:56,306 --> 02:05:57,306
Like, I'm not that smart.

1693
02:05:57,306 --> 02:06:02,306
So I look at, I just, I'm like strongest chain best, you know,

1694
02:06:02,306 --> 02:06:04,306
like, like, like, I'm not technical.

1695
02:06:04,306 --> 02:06:07,306
I can't tell you why Bitcoin's stronger.

1696
02:06:07,306 --> 02:06:08,306
I'm not that smart.

1697
02:06:08,306 --> 02:06:10,306
Like, I can't tell you why,

1698
02:06:10,306 --> 02:06:13,306
why the technical advantages it has over the other chains,

1699
02:06:13,306 --> 02:06:15,306
but I can tell you that it's more secure

1700
02:06:15,306 --> 02:06:17,306
because you don't have to be that smart

1701
02:06:17,306 --> 02:06:19,306
to know that Bitcoin is a more secure chain.

1702
02:06:19,306 --> 02:06:22,306
It has more eyeballs on it, more dollars behind it.

1703
02:06:22,306 --> 02:06:25,306
Its structure is impeccable, you know,

1704
02:06:25,306 --> 02:06:27,306
as far as centralization and stuff like that.

1705
02:06:27,306 --> 02:06:28,306
It doesn't have some group.

1706
02:06:28,306 --> 02:06:30,306
I mean, it's just like, you don't have to be that smart

1707
02:06:30,306 --> 02:06:32,306
to know that it's the, it's the strongest chain.

1708
02:06:32,306 --> 02:06:35,306
So I love the idea of building on top of it.

1709
02:06:35,306 --> 02:06:37,306
And I'm also like pro experimentation.

1710
02:06:37,306 --> 02:06:40,306
And part of that is being pro even stupid ideas.

1711
02:06:40,306 --> 02:06:42,306
Like I, I love the idea of NFTs.

1712
02:06:42,306 --> 02:06:43,306
I wouldn't buy one.

1713
02:06:43,306 --> 02:06:45,306
I've never bought one, but I think it's great.

1714
02:06:45,306 --> 02:06:46,306
Yeah, go, good.

1715
02:06:46,306 --> 02:06:48,306
Collectibles is a multi-billion dollar industry.

1716
02:06:48,306 --> 02:06:51,306
World of Warcraft has billions of dollars worth of stuff online.

1717
02:06:51,306 --> 02:06:52,306
Go for it.

1718
02:06:52,306 --> 02:06:53,306
Go, go buy.

1719
02:06:53,306 --> 02:06:55,306
If it gives you joy to buy some stupid JPEG, go, good.

1720
02:06:55,306 --> 02:06:56,306
Do it.

1721
02:06:56,306 --> 02:06:57,306
Wonderful.

1722
02:06:57,306 --> 02:06:58,306
And, you know, all kinds of, you know,

1723
02:06:58,306 --> 02:06:59,306
medical records on the blockchain.

1724
02:06:59,306 --> 02:07:01,306
Okay, it's dumb, but what do I know?

1725
02:07:01,306 --> 02:07:03,306
Maybe somebody somewhere will figure out

1726
02:07:03,306 --> 02:07:05,306
some smart way to do some of this stuff.

1727
02:07:05,306 --> 02:07:07,306
And I'm all for experimentation.

1728
02:07:07,306 --> 02:07:09,306
And eventually the market will decide.

1729
02:07:09,306 --> 02:07:10,306
Good things will rise to the top,

1730
02:07:10,306 --> 02:07:12,306
like good equities and good companies.

1731
02:07:12,306 --> 02:07:14,306
Those always make sense and always will, you know.

1732
02:07:14,306 --> 02:07:16,306
So, so, you know, so I'm all for it.

1733
02:07:16,306 --> 02:07:17,306
I think it's awesome.

1734
02:07:17,306 --> 02:07:19,306
And I, and I think it's good for Bitcoin.

1735
02:07:19,306 --> 02:07:21,306
And I think that, you know, it's valid to say

1736
02:07:21,306 --> 02:07:23,306
that you may only end up with kind of

1737
02:07:23,306 --> 02:07:25,306
like a main proof of work chain

1738
02:07:25,306 --> 02:07:28,306
because the externality cost of mining

1739
02:07:28,306 --> 02:07:29,306
is the same for everybody.

1740
02:07:29,306 --> 02:07:31,306
Electricity is electricity.

1741
02:07:31,306 --> 02:07:33,306
So eventually, you know, if you,

1742
02:07:33,306 --> 02:07:35,306
especially if you believe that proof of work

1743
02:07:35,306 --> 02:07:36,306
is like the best method,

1744
02:07:36,306 --> 02:07:39,306
then you could really kind of end up with one chain.

1745
02:07:39,306 --> 02:07:41,306
So that's the other reason to, you know, build on Bitcoin.

1746
02:07:41,306 --> 02:07:43,306
So I, you know, I think digital world, digital asset,

1747
02:07:43,306 --> 02:07:44,306
I think it's awesome.

1748
02:07:44,306 --> 02:07:46,306
10 out of 10.

1749
02:07:46,306 --> 02:07:47,306
Well, thanks for your support, Bruce.

1750
02:07:47,306 --> 02:07:49,306
One of my favorite memories of you

1751
02:07:49,306 --> 02:07:52,306
that I sometimes think of when I think about sidechains

1752
02:07:52,306 --> 02:07:57,306
is when you had the debate with the Chewbacca mask guy.

1753
02:07:57,306 --> 02:07:59,306
And I was just thinking about

1754
02:07:59,306 --> 02:08:01,306
how you would not have had to go through that

1755
02:08:01,306 --> 02:08:04,306
if not even like if we had sidechains,

1756
02:08:04,306 --> 02:08:06,306
but also just if like counterparty

1757
02:08:06,306 --> 02:08:08,306
had been treated a different way

1758
02:08:08,306 --> 02:08:10,306
that there was some colored coins thing.

1759
02:08:10,306 --> 02:08:11,306
But yeah, I remember that.

1760
02:08:11,306 --> 02:08:13,306
And I remember just thinking like

1761
02:08:13,306 --> 02:08:15,306
you did a very good job of being sort of dignified

1762
02:08:15,306 --> 02:08:18,306
in the face of that, whatever that,

1763
02:08:18,306 --> 02:08:20,306
however you want to describe whatever that was.

1764
02:08:20,306 --> 02:08:22,306
But basically you were trying to say about like, you know,

1765
02:08:22,306 --> 02:08:26,306
assets on chain and there's, it's,

1766
02:08:26,306 --> 02:08:28,306
I think I completely agree with you.

1767
02:08:28,306 --> 02:08:30,306
And the experimentation thing is the main point,

1768
02:08:30,306 --> 02:08:34,306
which is you shouldn't have to justify your idea

1769
02:08:34,306 --> 02:08:37,306
to people who don't like it.

1770
02:08:37,306 --> 02:08:38,306
You should only have to justify it

1771
02:08:38,306 --> 02:08:39,306
to the customers who like it.

1772
02:08:39,306 --> 02:08:42,306
Like if you open a restaurant, you know,

1773
02:08:42,306 --> 02:08:44,306
you're accountable to the customers who like the food.

1774
02:08:44,306 --> 02:08:46,306
You're not accountable to like the whole world.

1775
02:08:46,306 --> 02:08:47,306
Like since when did you have to,

1776
02:08:47,306 --> 02:08:50,306
and this idea that the people on the Bitcoin dev mailing list

1777
02:08:50,306 --> 02:08:54,306
are going to be always aware of every single use case

1778
02:08:54,306 --> 02:08:58,306
and every single invention in like a timely manner

1779
02:08:58,306 --> 02:09:01,306
and shepherd them through the Bitcoin Core development process

1780
02:09:01,306 --> 02:09:04,306
like instantly is also not true.

1781
02:09:04,306 --> 02:09:07,306
But with respect to the assets specifically,

1782
02:09:07,306 --> 02:09:12,306
I think I started to look into it kind of after you,

1783
02:09:12,306 --> 02:09:13,306
you did like,

1784
02:09:13,306 --> 02:09:16,306
this is when you started that time of when you would like walk

1785
02:09:16,306 --> 02:09:18,306
and do the phone videos.

1786
02:09:18,306 --> 02:09:22,306
And I was very surprised as to like how bad it was.

1787
02:09:22,306 --> 02:09:26,306
And it's like, and now we started this own corporation.

1788
02:09:26,306 --> 02:09:28,306
Like you have to register, you have to tell the, you know,

1789
02:09:28,306 --> 02:09:32,306
Delaware how many shares you have and kind of like who has them.

1790
02:09:32,306 --> 02:09:36,306
And I was like, Oh, a blockchain actually would be much better for this,

1791
02:09:36,306 --> 02:09:37,306
this part.

1792
02:09:37,306 --> 02:09:40,306
Like surely the audited financial statements and the operations of the

1793
02:09:40,306 --> 02:09:44,306
company, there's no way that the blockchain will do that.

1794
02:09:44,306 --> 02:09:48,306
But actually I thought this was, you know,

1795
02:09:48,306 --> 02:09:52,306
there's absolutely no reason for people to push back against this idea.

1796
02:09:52,306 --> 02:09:53,306
It's a very good idea.

1797
02:09:53,306 --> 02:09:56,306
Yeah, I think so.

1798
02:09:56,306 --> 02:09:59,306
Can I say something just real quick?

1799
02:09:59,306 --> 02:10:00,306
Yes.

1800
02:10:00,306 --> 02:10:02,306
A lot of people, a lot of people.

1801
02:10:02,306 --> 02:10:05,306
And lately this has been, you know,

1802
02:10:05,306 --> 02:10:10,306
so there was a period where everyone wanted to put everything on the

1803
02:10:10,306 --> 02:10:11,306
blockchain.

1804
02:10:11,306 --> 02:10:15,306
And then there came this giant backlash where people were saying blockchain

1805
02:10:15,306 --> 02:10:16,306
is stupid.

1806
02:10:16,306 --> 02:10:21,306
It's the shittiest database in existence and we should eradicate

1807
02:10:21,306 --> 02:10:23,306
blockchain from everywhere possible.

1808
02:10:24,306 --> 02:10:31,306
So there is a line basically where I think very easy to see a clear

1809
02:10:31,306 --> 02:10:36,306
separation between the good and the not so good or not so smart use of

1810
02:10:36,306 --> 02:10:37,306
blockchain.

1811
02:10:37,306 --> 02:10:42,306
And that is making sure that in a decentralized setting,

1812
02:10:42,306 --> 02:10:46,306
consensus critical data is available.

1813
02:10:46,306 --> 02:10:49,306
That is an excellent use of the blockchain.

1814
02:10:49,306 --> 02:10:52,306
I'm not so much sold on the rest.

1815
02:10:52,306 --> 02:10:55,306
So like, you know, putting,

1816
02:10:55,306 --> 02:10:58,306
putting JPEGs and medical records on blockchains,

1817
02:10:58,306 --> 02:11:01,306
I don't think that's, that's an excellent idea.

1818
02:11:01,306 --> 02:11:05,306
But, but there are legitimate.

1819
02:11:05,306 --> 02:11:08,306
Different way though, I think, I mean, like, I agree with you.

1820
02:11:08,306 --> 02:11:11,306
Like there's like, what do we expect in equilibrium?

1821
02:11:11,306 --> 02:11:15,306
Will the asset, will like digital assets actually be like, well,

1822
02:11:15,306 --> 02:11:17,306
digital art,

1823
02:11:17,306 --> 02:11:22,306
will it be the actual JPEG on chain or will it merely be the hash?

1824
02:11:22,306 --> 02:11:25,306
I think you and I know that at the end of the day,

1825
02:11:25,306 --> 02:11:28,306
there's really no difference since it's just the computer interpreting the

1826
02:11:28,306 --> 02:11:30,306
JPEG file as an image.

1827
02:11:30,306 --> 02:11:32,306
There's very little difference between,

1828
02:11:32,306 --> 02:11:34,306
especially if you know about an info hash, like in BitTorrent.

1829
02:11:34,306 --> 02:11:36,306
Sorry, it's really raining here.

1830
02:11:36,306 --> 02:11:37,306
Can you guys hear this?

1831
02:11:37,306 --> 02:11:38,306
Oh my gosh, crazy rain.

1832
02:11:38,306 --> 02:11:39,306
No, we hear you well.

1833
02:11:39,306 --> 02:11:40,306
Okay, good.

1834
02:11:40,306 --> 02:11:42,306
The, the,

1835
02:11:43,306 --> 02:11:46,306
like we know from BitTorrent that a hash can basically transform into a

1836
02:11:46,306 --> 02:11:47,306
file.

1837
02:11:47,306 --> 02:11:51,306
And you also kind of know that if the file is right in front of you,

1838
02:11:51,306 --> 02:11:53,306
it's hash is kind of equal to the file.

1839
02:11:53,306 --> 02:11:57,306
And if you know the hash, someone else can tell you, hey,

1840
02:11:57,306 --> 02:11:58,306
this is the image.

1841
02:11:58,306 --> 02:12:01,306
So you and I know that basically the hat at the end of the day,

1842
02:12:01,306 --> 02:12:03,306
it's going to be the hash on chain.

1843
02:12:03,306 --> 02:12:07,306
But maybe if instead of an image that is like an inscription,

1844
02:12:07,306 --> 02:12:09,306
it's something else, like it's a,

1845
02:12:09,306 --> 02:12:11,306
some kind of advertisement or it's a,

1846
02:12:11,306 --> 02:12:14,306
it's like the Tiananmen square tank man photo,

1847
02:12:14,306 --> 02:12:17,306
or it's some other type of thing.

1848
02:12:17,306 --> 02:12:21,306
And so I think we should not be so quick to just dismiss the whole

1849
02:12:21,306 --> 02:12:26,306
category of like putting an image on chain or putting medical records on

1850
02:12:26,306 --> 02:12:27,306
chain.

1851
02:12:27,306 --> 02:12:28,306
You know what I mean?

1852
02:12:28,306 --> 02:12:31,306
Like you and I know that certain things in equilibrium are just

1853
02:12:31,306 --> 02:12:34,306
inefficient from an engineering point of view,

1854
02:12:34,306 --> 02:12:36,306
but that's not really the point.

1855
02:12:36,306 --> 02:12:39,306
The point is people are very clever.

1856
02:12:39,306 --> 02:12:44,306
And if they're willing to pay, if the miner is willing to mine,

1857
02:12:44,306 --> 02:12:45,306
you sell them the block space.

1858
02:12:45,306 --> 02:12:48,306
If someone is willing to buy and if developers are willing to write

1859
02:12:48,306 --> 02:12:53,306
software that users are willing to use somewhere in this intersection,

1860
02:12:53,306 --> 02:12:59,306
there will be something, something cool that benefits all four parties.

1861
02:12:59,306 --> 02:13:02,306
And I think that is how I would sort of reframe it.

1862
02:13:07,306 --> 02:13:09,306
Yeah, I'd say, you know,

1863
02:13:09,306 --> 02:13:13,306
it really depends on the use case and what the ultimate goal is.

1864
02:13:13,306 --> 02:13:16,306
The reason I mentioned medical records is because personally,

1865
02:13:16,306 --> 02:13:17,306
I think that's kind of a dumb idea.

1866
02:13:17,306 --> 02:13:19,306
It's something you've heard about for a long time,

1867
02:13:19,306 --> 02:13:21,306
but it's just kind of like, it's a dumb idea.

1868
02:13:21,306 --> 02:13:24,306
But my point was that, what do I know?

1869
02:13:24,306 --> 02:13:27,306
Maybe dumb idea works. Like I I'm not a medical expert, you know,

1870
02:13:27,306 --> 02:13:29,306
it might be solving some problem I'm unaware of, but, but,

1871
02:13:29,306 --> 02:13:32,306
but just to be clear, I'm not advocating, you know, the opposite.

1872
02:13:32,306 --> 02:13:34,306
I actually think it's kind of dumb, but,

1873
02:13:34,306 --> 02:13:38,306
but I'm also like a defender of stupid experiments because, because,

1874
02:13:38,306 --> 02:13:40,306
you know, stupid experiments is what you do.

1875
02:13:40,306 --> 02:13:43,306
Thousands of stupid experiments, something, something does become cool.

1876
02:13:43,306 --> 02:13:46,306
But the other thing is, so if you look at the actual,

1877
02:13:46,306 --> 02:13:49,306
like what are you trying to solve for, you know,

1878
02:13:49,306 --> 02:13:53,306
I view Bitcoin as like, you know,

1879
02:13:53,306 --> 02:13:59,306
some variation of solving the Byzantine generals dilemma, basically.

1880
02:13:59,306 --> 02:14:03,306
It's, it is, you know,

1881
02:14:03,306 --> 02:14:08,306
basically a way for you to distribute trust and not have to rely,

1882
02:14:08,306 --> 02:14:11,306
like to have a, have a group of peers decide what is true.

1883
02:14:11,306 --> 02:14:14,306
It's kind of what I view Bitcoin as, as core.

1884
02:14:14,306 --> 02:14:15,306
And I think that solves a real thing.

1885
02:14:15,306 --> 02:14:16,306
We know why it solves it for, for,

1886
02:14:16,306 --> 02:14:21,306
for money and being able to say who has what money where and not needing a

1887
02:14:21,306 --> 02:14:23,306
bank or something to say that I sent this to you,

1888
02:14:23,306 --> 02:14:26,306
we can get the network and both trust it and even run our own node.

1889
02:14:27,306 --> 02:14:28,306
And that is limited.

1890
02:14:28,306 --> 02:14:32,306
There's a lot of things where that's not useful. Like it's like, well,

1891
02:14:32,306 --> 02:14:34,306
who cares? You know, you know what,

1892
02:14:34,306 --> 02:14:37,306
why if it's just a JPEG that somebody gave you,

1893
02:14:37,306 --> 02:14:41,306
why do you care about having this billion dollar security network?

1894
02:14:41,306 --> 02:14:45,306
That's meant to be nation state resistant, have your record, you know,

1895
02:14:45,306 --> 02:14:46,306
but for other things, I, you know,

1896
02:14:46,306 --> 02:14:49,306
I know securities pretty well and I think like securities is an example that I

1897
02:14:49,306 --> 02:14:53,306
think it actually does work because it is similar to the Byzantine generals

1898
02:14:53,306 --> 02:14:56,306
dilemma, which basically is,

1899
02:14:56,306 --> 02:14:59,306
is about untrusted parties needing to communicate what's true.

1900
02:14:59,306 --> 02:15:02,306
So if you're in an environment of untrusted parties,

1901
02:15:02,306 --> 02:15:04,306
which is what we have now in the real securities world,

1902
02:15:04,306 --> 02:15:06,306
in the real securities world, big public companies,

1903
02:15:06,306 --> 02:15:10,306
you have hundreds of brokers and clearing firms and transfer agents and

1904
02:15:10,306 --> 02:15:14,306
the issuers themselves and, and all these groups, hedge funds, you know,

1905
02:15:14,306 --> 02:15:17,306
all these groups that don't trust each other. And like, you know,

1906
02:15:17,306 --> 02:15:21,306
so like Apple shares, Apple shares, who knows who has what Apple shares,

1907
02:15:22,306 --> 02:15:25,306
Merrill Lynch doesn't know. They only know Merrill Lynch clients,

1908
02:15:25,306 --> 02:15:27,306
Charles Schwab only knows Charles Schwab clients.

1909
02:15:27,306 --> 02:15:30,306
They will not share the list with each other. Who will they share it with?

1910
02:15:30,306 --> 02:15:33,306
Apple? Absolutely not. They might be doing a shareholder takeover.

1911
02:15:33,306 --> 02:15:34,306
They're not sharing it with Apple.

1912
02:15:34,306 --> 02:15:37,306
They're not obligated by law to and they don't have the mechanism.

1913
02:15:37,306 --> 02:15:41,306
So Apple doesn't even know their own shareholders unless they go to all these

1914
02:15:41,306 --> 02:15:44,306
clunky long story short centralized databases and yada yada.

1915
02:15:44,306 --> 02:15:48,306
But ultimately to make all this system work,

1916
02:15:48,306 --> 02:15:50,306
it relies heavily on centralized database.

1917
02:15:50,306 --> 02:15:53,306
In the US it's called DTCC where basically all the stocks are in this,

1918
02:15:53,306 --> 02:15:55,306
this thing.

1919
02:15:55,306 --> 02:15:59,306
So for you to know what's true when you move your shares from Merrill Lynch to

1920
02:15:59,306 --> 02:16:04,306
Robinhood that has to, you know, Robinhood reports it.

1921
02:16:04,306 --> 02:16:06,306
Merrill Lynch reports that it goes up through this clunky system,

1922
02:16:06,306 --> 02:16:10,306
through DTCC and CD&Co and this whole clunky goofy system, which is,

1923
02:16:10,306 --> 02:16:12,306
by the way, it's the only way they've been able to make it work.

1924
02:16:12,306 --> 02:16:15,306
These are smart people with billions and billions of dollars. You know,

1925
02:16:15,306 --> 02:16:18,306
a lot of people I've mentioned this before and somebody be like, Oh,

1926
02:16:18,306 --> 02:16:22,306
that's easy to fix. Just use the signature with the, with the PGP key or something.

1927
02:16:22,306 --> 02:16:24,306
Like, no, it's not easy to fix.

1928
02:16:24,306 --> 02:16:26,306
There's billions of dollars really smart people trying to work on it.

1929
02:16:26,306 --> 02:16:31,306
These firms don't trust each other and trust non-trusted parties sharing

1930
02:16:31,306 --> 02:16:35,306
information and verifying what's true is a difficult problem until Bitcoin

1931
02:16:35,306 --> 02:16:37,306
technology solved it. It solved a thing.

1932
02:16:37,306 --> 02:16:41,306
It's a real thing that was a real solution that was solved aside from the

1933
02:16:41,306 --> 02:16:42,306
invention of money.

1934
02:16:42,306 --> 02:16:45,306
It actually solved a thing that couldn't be, couldn't be done before.

1935
02:16:45,306 --> 02:16:50,306
You now have a way, you know, to kind of solve this way of, of, you know,

1936
02:16:52,306 --> 02:16:55,306
like, like, you know, sharing information and untrusted source. So I,

1937
02:16:55,306 --> 02:16:59,306
so I think like you could tag, there's some devils in the details, you know,

1938
02:16:59,306 --> 02:17:03,306
securities kind of need identity and identity doesn't jive well with this kind

1939
02:17:03,306 --> 02:17:06,306
of decentralized permissionless stuff. You know, there's, there's, there's,

1940
02:17:06,306 --> 02:17:07,306
there's devil in the details,

1941
02:17:07,306 --> 02:17:11,306
but I am convinced that in a digital world and especially a Bitcoin world,

1942
02:17:11,306 --> 02:17:15,306
you're going to have things like securities interact. And I am convinced that,

1943
02:17:15,306 --> 02:17:17,306
you know, just scrap DTCC, you know,

1944
02:17:17,306 --> 02:17:21,306
why do I need to go through 10 clunky parties to say what's true when I want to

1945
02:17:21,306 --> 02:17:26,306
own IBM stock? When, if I want to own a ordinal token,

1946
02:17:26,306 --> 02:17:29,306
I can see what's true right on my Bitcoin blockchain, you know, like why,

1947
02:17:29,306 --> 02:17:32,306
you know, that's just a better way. And, and, you know,

1948
02:17:32,306 --> 02:17:34,306
I'm making it overly simplistic, maybe it won't be on chain or whatever,

1949
02:17:34,306 --> 02:17:36,306
but you know what I'm saying? It's like,

1950
02:17:36,306 --> 02:17:39,306
I think it depends on the use case is basically what I'm saying.

1951
02:17:39,306 --> 02:17:40,306
Well,

1952
02:17:40,306 --> 02:17:44,306
one thing that is interesting is when you have a trusted issuer or some trusted

1953
02:17:44,306 --> 02:17:49,306
arbiter that does the ultimate enforcement or redemption,

1954
02:17:49,306 --> 02:17:54,306
then you can suddenly compartmentalize the burden of

1955
02:17:54,306 --> 02:17:55,306
validating these things.

1956
02:17:55,306 --> 02:18:00,306
And there are a lot of people working on client side validation stuff,

1957
02:18:00,306 --> 02:18:03,306
where you basically just commit to these actions,

1958
02:18:03,306 --> 02:18:07,306
but completely hide them from on chain,

1959
02:18:07,306 --> 02:18:09,306
but you still kind of have, you know,

1960
02:18:09,306 --> 02:18:12,306
the Bitcoin blockchain or a sidechain as a,

1961
02:18:12,306 --> 02:18:19,306
as an encore to this thermodynamic ordering of event stuff that,

1962
02:18:19,306 --> 02:18:22,306
that we like Bitcoin for.

1963
02:18:22,306 --> 02:18:25,306
And basically you get the benefit,

1964
02:18:25,306 --> 02:18:30,306
but you also can just leave everyone out of your private dealings of,

1965
02:18:30,306 --> 02:18:33,306
of these assets that, like I said,

1966
02:18:33,306 --> 02:18:38,306
are issued by some centralized authority in a sense.

1967
02:18:38,306 --> 02:18:39,306
Well,

1968
02:18:39,306 --> 02:18:43,306
I think you said that you would specialize,

1969
02:18:43,306 --> 02:18:48,306
you divide the labor and you'd say, everyone agrees that, you know,

1970
02:18:48,306 --> 02:18:53,306
Apple has this ticker symbol in the digital asset world.

1971
02:18:53,306 --> 02:18:56,306
And then anyone can look up on the blockchain,

1972
02:18:56,306 --> 02:19:00,306
like how many shares of Apple there are and even get in contact with those

1973
02:19:00,306 --> 02:19:04,306
people in a way, or know that they, who they're dealing with.

1974
02:19:04,306 --> 02:19:05,306
And so it's,

1975
02:19:05,306 --> 02:19:10,306
it would seem to be an enormous improvement over the current system.

1976
02:19:10,306 --> 02:19:14,306
Even if it of course cannot do anything about the operations or like can't

1977
02:19:14,306 --> 02:19:18,306
guarantee dividends are paid. Although it could also, you know,

1978
02:19:18,306 --> 02:19:20,306
you could force the dividends to be paid on chain.

1979
02:19:20,306 --> 02:19:22,306
Then at least you would know whether or not they were paid.

1980
02:19:22,306 --> 02:19:24,306
That would also be there. It just seems like there's,

1981
02:19:24,306 --> 02:19:26,306
but I think it's missing the bigger point,

1982
02:19:26,306 --> 02:19:30,306
which is that the alternative to like.

1983
02:19:30,699 --> 02:19:37,699
What Bruce was just saying about like the dumb experimentation, like the alternative to that is someone who is omniscient.

1984
02:19:37,699 --> 02:19:46,699
So if you have someone who's omniscient, then we don't need a dumb experimentation because you can just ask that one everything.

1985
02:19:46,699 --> 02:19:56,699
You ask that person and they'll tell us whether or not an idea is good or not, but otherwise we kind of need to try each idea to see whether or not it's good.

1986
02:19:57,699 --> 02:20:03,699
I can give you another example that happens to be with digital assets, which I was going to write this post up, but I didn't get to it.

1987
02:20:03,699 --> 02:20:10,699
But one curious thing about NFTs is that actually they can lower your taxes in a way.

1988
02:20:10,699 --> 02:20:14,699
If in certain cases you think like, what am I talking about?

1989
02:20:14,699 --> 02:20:18,699
But that's why I was going to write this post because it's such a funny little weird argument.

1990
02:20:19,699 --> 02:20:28,699
But it's basically like if you have money, you have dark net money that you want to, you know, let's say you wanted to make it taxable.

1991
02:20:28,699 --> 02:20:35,699
You could either do like what Jesse Pinkman in Better Go Breaking Bad, they buy the nail salon or whatever, the car wash.

1992
02:20:35,699 --> 02:20:38,699
That's like one pop culture reference.

1993
02:20:38,699 --> 02:20:45,699
But you can also like make an asset and then like trade it to yourself and then it's in the capital gains world.

1994
02:20:45,699 --> 02:20:49,699
Now, I don't know like how legal this is or whatever. It's probably illegal.

1995
02:20:49,699 --> 02:20:55,699
But I just bring it up to show the idea that when you have like Francis Puyo or whatever, I like Francis Puyo a lot.

1996
02:20:55,699 --> 02:21:05,699
But if they're saying like there's no people getting like frothing at the mouth and like very angry that something can never be allowed, it should never, it is irredeemably evil.

1997
02:21:05,699 --> 02:21:09,699
There are often a lot of motivations why someone may want to do something.

1998
02:21:09,699 --> 02:21:11,699
Some may be overt, some may be covert.

1999
02:21:11,699 --> 02:21:14,699
I don't think anyone is actually doing this NFT tax thing at all.

2000
02:21:14,699 --> 02:21:16,699
I just point it out because I think it's funny.

2001
02:21:16,699 --> 02:21:23,699
Like if you say on your tax return, oh, I made – I held whatever.

2002
02:21:23,699 --> 02:21:28,699
I held Moon Settler coin for 13 months and I made $100,000.

2003
02:21:34,699 --> 02:21:36,699
We might have lost you, Paul.

2004
02:21:36,699 --> 02:21:38,699
The connection might have gone.

2005
02:21:38,699 --> 02:21:40,699
I can't hear him.

2006
02:21:40,699 --> 02:21:43,699
How about you, Randall? Can you hear him?

2007
02:21:43,699 --> 02:21:48,699
The connection might have gone if anybody wants some rare inscriptions.

2008
02:21:48,699 --> 02:21:55,699
Yeah, just to be clear, we at LayerTwo Labs recommend everyone pay their taxes as appropriate.

2009
02:21:55,699 --> 02:22:03,699
But yeah, it's true that a lot of the activity in the NFT world may be for reasons that aren't obvious or publicly stated.

2010
02:22:03,699 --> 02:22:09,699
People might be doing things for their personal reasons that have to do with the values involved.

2011
02:22:10,699 --> 02:22:14,699
I'm just saying particularly in regards to Securities.

2012
02:22:14,699 --> 02:22:19,699
Securities is not a distributed decentralized game.

2013
02:22:19,699 --> 02:22:27,699
As others have mentioned, it is a regulated game where you have an authority at the end of the day.

2014
02:22:28,699 --> 02:22:40,699
The main property of these Securities and various tokens that represent real things is it's not really enforceable just on the blockchain.

2015
02:22:40,699 --> 02:22:44,699
At one point, you are going to need to have a guy with a stick.

2016
02:22:44,699 --> 02:22:50,699
The guy with the largest stick is basically the state, the authorities.

2017
02:22:50,699 --> 02:22:57,699
You need a guy with a stick to enforce these small contracts because they relate to real world things.

2018
02:22:59,699 --> 02:23:03,699
You can divide and conquer or whatever.

2019
02:23:03,699 --> 02:23:05,699
It's like with Tether.

2020
02:23:05,699 --> 02:23:08,699
You say there is a backer.

2021
02:23:09,699 --> 02:23:15,699
One thing with Tether is I don't know how much money they're making now.

2022
02:23:15,699 --> 02:23:23,699
But as interest rates rise, they must be making whatever it is per month for doing nothing.

2023
02:23:23,699 --> 02:23:28,699
Just because people trust them with the billions of dollars of cash, basically.

2024
02:23:28,699 --> 02:23:30,699
Because they can just buy bonds.

2025
02:23:30,699 --> 02:23:35,699
I'm sure they're like MF globaling it or whatever they're doing where they get a little yield from all these interest rates.

2026
02:23:36,699 --> 02:23:42,699
I think it's a case where they say we're going to break it down into different tasks.

2027
02:23:42,699 --> 02:23:45,699
We're going to say we will handle the redemption part.

2028
02:23:45,699 --> 02:23:47,699
We will shoulder the risk.

2029
02:23:47,699 --> 02:23:49,699
It's just basic division of labor.

2030
02:23:49,699 --> 02:23:52,699
It's like an Adam Smith thing where they say we will break it up.

2031
02:23:52,699 --> 02:23:59,699
Whether or not you transfer USDT to someone or not is up to you and the blockchain.

2032
02:23:59,699 --> 02:24:03,699
That's how progress works.

2033
02:24:04,699 --> 02:24:06,699
You break the task up into different pieces.

2034
02:24:09,699 --> 02:24:16,699
Anyone who would protest against that and say it's not a real example, they have their work cut out for them.

2035
02:24:16,699 --> 02:24:25,699
Because they have to say that Tether isn't real or that Tether isn't a good thing.

2036
02:24:26,699 --> 02:24:28,699
I did not say that.

2037
02:24:28,699 --> 02:24:36,699
To clarify my point, this use case does not actually need a global consensus on what is happening.

2038
02:24:36,699 --> 02:24:39,699
It does not actually require everyone to know what is happening.

2039
02:24:39,699 --> 02:24:41,699
That is the beauty of the client-side validation.

2040
02:24:41,699 --> 02:24:43,699
It's the curse of the client-side validation.

2041
02:24:43,699 --> 02:24:44,699
Don't you think?

2042
02:24:44,699 --> 02:24:46,699
Sometimes people do want to know.

2043
02:24:46,699 --> 02:24:50,699
I want to know if I buy Apple stock, I want to know how much Apple stock is there.

2044
02:24:51,699 --> 02:24:53,699
Yeah, you can.

2045
02:24:53,699 --> 02:25:06,699
People who buy Apple stocks obviously will see Apple issuing X amount, X number of stocks in a funding transaction.

2046
02:25:06,699 --> 02:25:09,699
Basically, that is the root of this whole thing.

2047
02:25:09,699 --> 02:25:13,699
I'm just trying to say not everything needs to be a global burden.

2048
02:25:13,699 --> 02:25:16,699
That was my main point with all these things.

2049
02:25:16,699 --> 02:25:23,699
Blockchains have an important role, seemingly, in rooting these things somehow in reality.

2050
02:25:23,699 --> 02:25:35,699
But these are not necessarily decentralized legally or otherwise enforced things that do not actually require a global consensus.

2051
02:25:35,699 --> 02:25:36,699
That's what we see.

2052
02:25:36,699 --> 02:25:39,699
It's different from Bitcoin.

2053
02:25:40,699 --> 02:25:46,699
I may be wrong, but I think client-side validation…

2054
02:25:46,699 --> 02:25:47,699
I don't know.

2055
02:25:47,699 --> 02:25:49,699
I think people actually like…

2056
02:25:49,699 --> 02:26:04,699
Since the asset is already digital and it's already abstract, it's not like you're buying a car or something real that you can push up against it and you can feel how heavy it is.

2057
02:26:05,699 --> 02:26:08,699
It's already very intangible.

2058
02:26:08,699 --> 02:26:11,699
And then the idea that you can't…

2059
02:26:11,699 --> 02:26:13,699
People like a block explorer.

2060
02:26:13,699 --> 02:26:17,699
They like knowing they could look it up and see, oh, how many coins do I have?

2061
02:26:17,699 --> 02:26:18,699
People don't really understand.

2062
02:26:18,699 --> 02:26:27,699
They know they're running a node, but they kind of want to know something about what do other people's nodes say.

2063
02:26:27,699 --> 02:26:29,699
I think that's just a very human emotion.

2064
02:26:29,699 --> 02:26:33,699
I actually think that this will be tough for client-side validation.

2065
02:26:33,699 --> 02:26:38,699
In fact, it manifests itself with a concern that I think Peter Todd has written about.

2066
02:26:38,699 --> 02:26:42,699
Maybe I'm misremembering this, but the concern goes basically something like this.

2067
02:26:42,699 --> 02:26:58,699
You can release a version of client-side validation version one, and then a different person can simply release a second version of the compiled software or whatever it is, the protocol.

2068
02:26:59,699 --> 02:27:07,699
And in that second version, it's like basically a hard fork, or they can do all kinds of mischief, like give themselves out because it's a different version.

2069
02:27:07,699 --> 02:27:20,699
And then the two versions kind of compete in the wild in a kind of popularity contest where there's no proof of work, like promoting one software version against the next.

2070
02:27:20,699 --> 02:27:24,699
And I may be wrong, but I think that this is why RGB took so long.

2071
02:27:24,699 --> 02:27:27,699
It's because they wanted to try to finish it as much as possible.

2072
02:27:27,699 --> 02:27:33,699
Although, of course, is it even possible to succeed at that task because software is never finished?

2073
02:27:33,699 --> 02:27:34,699
I don't know.

2074
02:27:37,699 --> 02:27:47,699
One way of putting together what Bruce said and what Moon Settler said, like I heard Bruce talk about the interesting potential to have securities on blockchain.

2075
02:27:47,699 --> 02:27:52,699
And then Moon Settler seemed to say, we don't need that kind of thing on blockchain.

2076
02:27:52,699 --> 02:27:57,699
But Hivemind would be a futures market on blockchain.

2077
02:27:57,699 --> 02:27:59,699
Well, that's a completely different thing though.

2078
02:28:03,699 --> 02:28:09,699
The assets in Hivemind are built in this Oracle system.

2079
02:28:09,699 --> 02:28:12,699
So that is a completely different thing.

2080
02:28:12,699 --> 02:28:14,699
But it's also very cool.

2081
02:28:14,699 --> 02:28:15,699
What I meant was…

2082
02:28:15,699 --> 02:28:18,699
The original thing that I invented that people liked.

2083
02:28:18,699 --> 02:28:25,699
And in fact, all the OGs probably only remember me for that, which is kind of a weird paradox.

2084
02:28:25,699 --> 02:28:33,699
What I wanted to just quickly say was that one of the main reasons to have a blockchain is if the market is suppressed by the government.

2085
02:28:33,699 --> 02:28:36,699
Like the market for money is heavily regulated and suppressed by governments.

2086
02:28:36,699 --> 02:28:39,699
So that's why peer-to-peer cash has great potential.

2087
02:28:40,699 --> 02:28:46,699
And similarly, there's a lot of futures markets that are heavily regulated or completely banned in many places.

2088
02:28:46,699 --> 02:28:55,699
So if people had an outlet for that kind of value, creative activity and commerce on blockchain, then that would be a market that otherwise wouldn't exist.

2089
02:28:55,699 --> 02:29:07,699
So I think Bruce is very close to the view that I'm optimistic about, which is that Hivemind could provide a new market of financial activity that otherwise wouldn't exist at all.

2090
02:29:08,699 --> 02:29:12,699
One small correction, if you allow me.

2091
02:29:12,699 --> 02:29:16,699
So that is not an entirely correct way to put what I said.

2092
02:29:16,699 --> 02:29:31,699
Because these client-side validation things do need the blockchains to be as permissionless and free in the transfer within the rules as they can be.

2093
02:29:31,699 --> 02:29:35,699
So it's not like you don't need a blockchain.

2094
02:29:35,699 --> 02:29:41,699
It's like you don't need to put everything on the blockchain that only concerns a few people.

2095
02:29:41,699 --> 02:29:43,699
That's the big difference.

2096
02:29:48,699 --> 02:29:52,699
Yeah, and you don't want to clog the chain itself.

2097
02:29:54,699 --> 02:29:56,699
And your point on the centralization.

2098
02:29:56,699 --> 02:30:01,699
With securities, you have an issue where it's centralized, but you're not solving for that.

2099
02:30:02,699 --> 02:30:09,699
You're not worried about Facebook stealing your shares and you're trying to get censorship resistance versus Facebook.

2100
02:30:09,699 --> 02:30:13,699
That's not a problem you're solving because you already trust the issuer.

2101
02:30:13,699 --> 02:30:21,699
What you're solving for is trust of the ledger manager, which these days is usually different than the issuer.

2102
02:30:21,699 --> 02:30:25,699
For a small startup, the startup will know who their own cap table is.

2103
02:30:25,699 --> 02:30:28,699
But for a big public company, they don't know who their cap table is.

2104
02:30:29,699 --> 02:30:32,699
They vaguely know, but it's all kind of distributed.

2105
02:30:32,699 --> 02:30:34,699
So for that one, you'd be solving.

2106
02:30:34,699 --> 02:30:35,699
You wouldn't want to replace.

2107
02:30:35,699 --> 02:30:37,699
It's not like you own Apple shares.

2108
02:30:37,699 --> 02:30:39,699
You want to replace Apple with a blockchain.

2109
02:30:39,699 --> 02:30:41,699
It's like you own Apple shares.

2110
02:30:41,699 --> 02:30:46,699
You want to replace the ledger manager, which is DTCC.

2111
02:30:46,699 --> 02:30:53,699
Yes, and you can actually do that without putting everything on the blockchain and expressing everything that you do.

2112
02:30:56,699 --> 02:30:57,699
I'm not sure about that.

2113
02:30:57,699 --> 02:30:59,699
I think it is better.

2114
02:31:01,699 --> 02:31:02,699
I don't know.

2115
02:31:02,699 --> 02:31:03,699
Maybe.

2116
02:31:03,699 --> 02:31:05,699
I don't know about the single-use seal thing.

2117
02:31:05,699 --> 02:31:06,699
I don't know if it will.

2118
02:31:06,699 --> 02:31:11,699
But the bigger point is that multiple different things should be tried, I think.

2119
02:31:13,699 --> 02:31:16,699
One more point, and then I will let this go, I promise.

2120
02:31:16,699 --> 02:31:21,699
So the point with client-side validation is there are people who want to play this game,

2121
02:31:21,699 --> 02:31:28,699
and the rest of the population, the rest of the users don't need to know about it because they are not interested in it.

2122
02:31:28,699 --> 02:31:38,699
These people either adhere to a rule set very strictly, or the other participants in the game will not accept the proof that they provide.

2123
02:31:38,699 --> 02:31:45,699
So if you just start to make Apple shares, like multiply your Apple shares from one transaction to the next,

2124
02:31:45,699 --> 02:31:47,699
you basically destroyed your Apple shares.

2125
02:31:47,699 --> 02:31:49,699
That's what you are doing in the end.

2126
02:31:50,699 --> 02:31:53,699
Like I said, there is a trusted issuer.

2127
02:31:53,699 --> 02:31:56,699
Apple is going to say, like, that transaction is bullshit.

2128
02:31:56,699 --> 02:31:59,699
Sorry, you have violated the terms of service, whatever.

2129
02:31:59,699 --> 02:32:01,699
So game over.

2130
02:32:01,699 --> 02:32:03,699
And it works perfectly well.

2131
02:32:03,699 --> 02:32:13,699
Like I said, some of these things are absolutely not consensus critical from the moment that you have a trusted issuer and a trusted redeemer,

2132
02:32:13,699 --> 02:32:20,699
a trusted arbiter of truth, and that other people can also just look up what you have done.

2133
02:32:20,699 --> 02:32:34,699
Because I will not accept your made-up Apple shares if you don't show me the entire transaction history of valid splits and merges and operations on this client-side validation stuff.

2134
02:32:34,699 --> 02:32:40,699
I will just not accept it unless I can verify it, and I can do that off-chain.

2135
02:32:40,699 --> 02:32:46,699
But I think that is a very interesting thing and basically can reconcile these two worlds,

2136
02:32:46,699 --> 02:32:55,699
that people want to have the advantages of blockchains, but blockchains are not really suitable for this type of thing.

2137
02:32:55,699 --> 02:32:57,699
You know, outright experts.

2138
02:33:00,699 --> 02:33:04,699
Reindahl, did you have a thought earlier that you didn't get to say?

2139
02:33:04,699 --> 02:33:17,699
No, I think earlier the conversation was going somewhere else, and I was going to ask Paul if the plan was still to do a prediction market if 303.01 could activate.

2140
02:33:17,699 --> 02:33:22,699
Because I actually think that that's still one of the better uses of a drivechain.

2141
02:33:25,699 --> 02:33:32,699
Well, it's a kind of a chicken and egg problem because the prediction market thing is itself a sidechain.

2142
02:33:32,699 --> 02:33:39,699
But I think, what would it be about? Would it be like, will it activate within a year or what would the price be if it did activate?

2143
02:33:39,699 --> 02:33:43,699
That would be like, that second one was like what I would do.

2144
02:33:43,699 --> 02:33:49,699
I think we could do that. There was like the fork futures idea. I like that idea.

2145
02:33:49,699 --> 02:33:56,699
That was in a different context, but that at least gives people something fun to look at every day.

2146
02:33:57,699 --> 02:34:05,699
I think what Reindahl is asking is perhaps, if drivechain is activated, would HiveMind potentially launch soon after that?

2147
02:34:05,699 --> 02:34:08,699
Oh yeah, that's definitely the case.

2148
02:34:08,699 --> 02:34:25,699
Yeah, that was the question. I think something like HiveMind for political prediction markets is one of those things that would give Bitcoin maybe more utility than just baseline money.

2149
02:34:26,699 --> 02:34:36,699
And of course, I don't know if it's possible, but something that has struck in my mind since I read about it,

2150
02:34:36,699 --> 02:34:46,699
and that's basically, you know, hash rate futures that allow miners to hedge their strategies in a more complex way.

2151
02:34:46,699 --> 02:34:49,699
Is that something that would be possible?

2152
02:34:50,699 --> 02:34:57,699
Didn't we talk about this before? I kind of vaguely, this is giving me deja vu, that isn't it like, it is possible,

2153
02:34:57,699 --> 02:35:04,699
but if you buy, if you're a miner and you own like an ASIC, that is already like a hash rate.

2154
02:35:04,699 --> 02:35:09,699
Like you're kind of just betting on your own performance relative to anyone else.

2155
02:35:09,699 --> 02:35:16,699
And who would bet, like why would you bet against yourself? Who would bet for you that's not you?

2156
02:35:17,699 --> 02:35:30,699
Maybe I skipped a bunch of steps there, a bit of proof, but basically the hash rate derivative is similar to just buying, you know, an ASIC or buying Bitcoin itself.

2157
02:35:30,699 --> 02:35:35,699
Just filtered through the idea that you would, you're betting on, like if you're betting the difficulty goes up,

2158
02:35:35,699 --> 02:35:39,699
then you're betting that all the mining technology will improve relative to the price of Bitcoin.

2159
02:35:40,699 --> 02:35:48,699
I think it's probably have to do with the frequency of trading. Like you can't buy and sell ASICs with light speed probably.

2160
02:35:48,699 --> 02:36:05,699
And the way Bitcoin miners would integrate to the energy markets, like miners could turn on and off based on, you know, the spot or even the futures, high frequency trading or the energy markets.

2161
02:36:05,699 --> 02:36:16,699
Well, I'll give you another example, right? Like there's a big lag between when a large miner starts deploying capital and when they're able to actually turn on hash rate,

2162
02:36:16,699 --> 02:36:22,699
because like they've got to buy energy purchase agreements, they might have to like build data centers,

2163
02:36:22,699 --> 02:36:26,699
they have to like rack and stack ASICs and like those have their own supply chain difficulties.

2164
02:36:27,699 --> 02:36:43,699
There's like a lot of, you know, just like on the ground logistics. And so if you're a large or medium Bitcoin miner and you model out that the hash rate is going to go up by like a certain percentage over the next nine months,

2165
02:36:43,699 --> 02:36:53,699
and you factor that into your economic model and you say, all right, as long as the hash rate doesn't go up by more than, you know, make up a number like 20% over the next nine months,

2166
02:36:53,699 --> 02:37:09,699
then like this investment will be profitable. But, you know, maybe you want to be able to hedge that by buying some hash rate derivative so that if the hash rate goes up by 50% and, you know, you're no longer deploying enough,

2167
02:37:09,699 --> 02:37:14,699
like your, you know, capital deployment now, it doesn't make any sense, you are hedged.

2168
02:37:15,699 --> 02:37:27,699
Yeah, you know, you guys, you are right. And I was wrong. And in fact, I fell into the trap I was just talking about earlier, where I don't actually know if what you said makes any sense, but it doesn't really matter because with Hivemind,

2169
02:37:27,699 --> 02:37:41,699
you can create the derivative that is just pays on whatever the hash rate is or whatever the difficulty is more likely. And people can then buy and sell that for any reason, including recreation, like just gambling, or no reason.

2170
02:37:42,699 --> 02:37:57,699
And if people out there want to find a reason and they think their mining rig will only be popular for certain regions of difficulty, and they want to buy that and someone else wants to sell, then it doesn't really matter what I think.

2171
02:37:57,699 --> 02:38:00,699
Or if they just want to gamble, who cares? It's their money, right?

2172
02:38:00,699 --> 02:38:01,699
Right.

2173
02:38:02,699 --> 02:38:16,699
So, such a thing is such a prediction market is possible and very, very easy to make, it will be very easy to make whenever Hivemind exists, it will just be typing and clicking some buttons.

2174
02:38:16,699 --> 02:38:26,699
And then the prediction markets thing, I think people don't even realize like, we stand on the precipice of all kinds of really cool stuff.

2175
02:38:26,699 --> 02:38:33,699
I think you should go to my website, BitcoinHivemind.com and just read a little there. Watch this couple of videos there.

2176
02:38:34,699 --> 02:38:50,699
And someone needs to invite me, I did a part two to that Anarchapulco talk, and it was canceled because of COVID. And I have never had a venue to give the part two, which means I will never actually finish the slides per se.

2177
02:38:50,699 --> 02:38:54,699
So someone needs to invite me somewhere, and I'll give part two of that talk.

2178
02:38:55,699 --> 02:39:00,699
Very good talk. And that's a really cool project.

2179
02:39:00,699 --> 02:39:07,699
There won't be anyone like Bill Maher or whatever, these people who say, well, cryptocurrency isn't for anything.

2180
02:39:07,699 --> 02:39:11,699
That'll be the end of that, if we were to get this off the ground.

2181
02:39:14,699 --> 02:39:16,699
I think Namecoin is also totally underappreciated.

2182
02:39:16,699 --> 02:39:24,699
I don't understand. I find it mind boggling, honestly. I don't understand why.

2183
02:39:27,164 --> 02:39:54,484
Someone dropped the ball on that. Someone dropped the ball on making that popular. I don't know what happened. It's such an amazing idea. The core of the idea is like you have one name that you use everywhere. So your Twitter handle or whatever it is, it's just your name everywhere in the world. And it's like also how people find you on Nostr. It's how people find you. It's how people email you. It's how they send you Bitcoin. There's no Bitcoin addresses. That's like the vision of the idea. So it's a huge idea.

2184
02:39:54,803 --> 02:40:15,283
For the non-technical here, could you explain what would the Namecoin sidechain be? And would it realize the vision that Satoshi contemplated briefly in that one thread where he talked about BitDNS? Would it be self-sovereign ownership of website addresses? Or is that a good synopsis of what we're talking about here?

2185
02:40:15,283 --> 02:40:45,204
Oh, yeah, but it'd be far more than that. Because basically, the way it would work is your quote, website, unquote, would basically be like you'd go to the site, like you'd go to like PaulStorts.com, or PaulStorts.bit, or whatever it is, PaulStorts.anarchy or whatever, you know, we'd be having some fun with this, I'm sure. But your computer would go there. And then it would look up, you'd have like a big JSON list or something of all of your stuff, your Bitcoin address, your Z address on the

2186
02:40:45,204 --> 02:41:13,123
Zcash sidechain, your Nostr address, your PGP key, your email, your phone, your telegram, everything would like it would all be all your whole identity would be there updatable by you only this, this would be like your website, but it would include a link to your, your onion website or your I2P site. So just like every single person would just get, you just get everything, all the authentication, all the finding people,

2187
02:41:13,123 --> 02:41:43,044
all of that would be fixed. And with that comes an end to many problems, but just like just authentication with username and password, which is annoying and doesn't work very well. Spam also, because you just have everything would just be whitelists. So you'd just be you'd, there'd be no spam, because it'd be whitelist on one hand, and then introductions would be gated by, like, like a like an onscene fee paying message.

2188
02:41:43,283 --> 02:41:45,604
Like a paymail idea or whatever, which is like,

2189
02:41:47,324 --> 02:42:05,684
how did the the original idea or the mortgages deal with this, you know, this huge speculative squatting problem where basically every intelligible word and word combination would be, you know, registered in the first five minutes of launching.

2190
02:42:06,684 --> 02:42:22,484
100% agree. No, you're 100% right. I think that's why the first Namecoin failed was the squatting. And I think I have the plan for that, too. But I think it was also it was more than that. I think it was just like way ahead of its time. And like, no one understood it. Like, no one really understood it for what it was.

2191
02:42:23,484 --> 02:42:38,803
And, like, like people also like it had an altcoin in it. And it was kind of that's kind of weird had NMC. And it was just weird merge mining, I think only like 40 people on the entire planet Earth actually like graphs, like, what are you doing or something?

2192
02:42:38,803 --> 02:42:55,244
Did anyone actually try to make something like this, you know, combined with, say, proof of work? Like, you would have to work like a thing with proof of work, Namecoin itself has existed. It was invented in 2010, long ago.

2193
02:42:56,803 --> 02:42:59,443
And still the squatting was heavy.

2194
02:42:59,443 --> 02:43:29,083
The squatting Yeah, but the squatting is my I have a plan for that. And you can read all about it in my posts, if you want to read about it. But the the basic plan, because I think that this is right. This is the the property rights on the name. People reacted badly to this. They said I already paid whatever $100,000 for google.com. And they say now I missed my chance to register this. And this this threw off the the coalition building human element of the idea.

2195
02:43:29,443 --> 02:43:58,963
squatting. And so how do you deal with squatting? And I say, well, we basically do is we hard fork the the ICANN UTXO set with transaction replay, which is a weird way of describing it. But but what I really mean is, if you own google.com in the real world, we'll have the we'll have you own google.com in the blockchain world, and we'll have that update be done in a special key that works only within the L1 world and only on

2196
02:43:58,963 --> 02:44:28,364
ICANN formatted names. So the ICANN formatted names will all be in the Namecoin blockchain, the Namecoin sidechain, which I call BitNames now since Namecoin is a different thing. So in this BitNames blockchain, they'll all be in there, all the names will be in there. The ICANN names and if someone buys an ICANN name, they'll be able to get it in the blockchain, but the blockchain will be doing all of this without actually leaving

2197
02:44:28,364 --> 02:44:58,204
it's itself without actually leaving the the blockchain world and asking ICANN. So it'll be like a one way street. And I think that would be enough. You'd say this is interoperable with the old system, that would be enough to deter, no one would be able to squat like you could squat google.anarchy, but you couldn't squat google.com. And so but that's not the point. The point is this, this type of thing wouldn't be for google.com, you have to try to

2198
02:44:58,204 --> 02:45:27,804
preserve everything about the internet that already works, which is the google.com part, but you would want to add on to it, you'd want to add in like, whatever it is Edward Snowden.bit, or Julian Assange.anarchy, or whatever it is. So or whatever, whatever, you know, whatever Vladimir Zelensky dot, you know, dot bit or whatever, you know, whatever, whatever the thing is of the day Canadian truckers that bit. So, and then we would not have the

2199
02:45:27,804 --> 02:45:49,723
problem mentioned before the Canadian truckers, which is a total embarrassment. And that is another clue that we are not doing things the right way, which is that it should be possible within like 15 minutes for everyone to figure out how to get money from wherever you are to some kind of political protest anywhere in the world. If we can't do that, then we're really kind of lame.

2200
02:45:53,663 --> 02:45:59,103
you were gonna say, hardware tax,

2201
02:45:59,523 --> 02:46:01,763
which would also be like a fun experiment to run.

2202
02:46:01,923 --> 02:46:03,088
And if there's a way to do

2203
02:46:03,688 --> 02:46:08,328
you know, permissionless L2s or sidechains on Bitcoin, then maybe we could play with a

2204
02:46:08,328 --> 02:46:12,368
Arbor Tax, a BitTNS system.

2205
02:46:14,048 --> 02:46:15,148
See which one wins.

2206
02:46:16,454 --> 02:46:24,654
Yeah, I think part of it was that it was described as a DNS system.

2207
02:46:24,654 --> 02:46:30,334
I think that's part of why it didn't catch on because Bitcoin was just very nerdy at

2208
02:46:30,334 --> 02:46:31,334
the time.

2209
02:46:31,334 --> 02:46:32,214
You know, it's like 2010.

2210
02:46:32,754 --> 02:46:40,754
So it's like ultra nerds, and these are people who are really, really, really familiar with the problems of DNS, which is just like basically that you...

2211
02:46:40,754 --> 02:46:44,754
One silly thing is that you have to pay, you rent them, you know.

2212
02:46:44,754 --> 02:46:49,618
The database update, when you buy it, there's one database update.

2213
02:46:49,618 --> 02:46:55,618
But you have to keep paying every year, and you have to pay for, if you want HTTPS, there's

2214
02:46:55,618 --> 02:47:02,858
you know, exceptions and stuff, but basically, most people have to pay like five, six dollars

2215
02:47:02,858 --> 02:47:06,898
a month, or whatever it is, I'm not familiar with the going rates, but you have to pay

2216
02:47:06,898 --> 02:47:12,538
for HTTPS, which is like ridiculous, because it's all authentic, like we have private keys

2217
02:47:12,538 --> 02:47:13,563
and public keys.

2218
02:47:14,324 --> 02:47:15,683
the cryptography is all free.

2219
02:47:15,924 --> 02:47:34,843
Well, I think one of the other things that was like that, that, that, like Namecoin got wrong, and then ENS kind of got right, is, I think, if on day one, you say, we're gonna try to replace DNS, then like a category error that I made was saying,

2220
02:47:34,843 --> 02:48:03,883
Alright, well, look at all of the software that supports DNS. And are you going to either port or bridge like all of that to work with like this new naming system? Like, that's insane. And then I think what other projects did, like ENS did this, I think, really well, is they said, we're going to build a, you know, a decentralized name system kind of analog, that makes a ton of sense within this one, like vertical, and just like take that thing over and then slowly expand outward.

2221
02:48:03,883 --> 02:48:31,883
So you do something similar, right? Like there's something happening kind of like that in the Ordinals ecosystem, where people are coming up with like naming schemes for trading around their rare Satoshis. And, you know, folks are starting to like add software support for like other things that use that same naming scheme. And that's like a more reasonable way to kind of land and expand and just say, like, hey, Google, don't worry, we reserved your bit DNS for you.

2222
02:48:32,883 --> 02:49:01,763
Yeah, but the other side, the other side of the coin, by the way, with this whole DNS and this certificate authority system is that it is actually abusable. So there are authorities that can take your DNS, your certification away or your issue, you know, for some malicious or maybe in your perspective, malicious, but maybe they are a government agency.

2223
02:49:01,763 --> 02:49:19,643
So government agency can just simply get a perfectly valid certificate issued to them in your name. And you don't really have control over this whole thing. So you are completely beholden to centralized doctors and their good grace and their good behavior.

2224
02:49:19,643 --> 02:49:25,343
behavior and if you expect that these root certificate authorities

2225
02:49:25,343 --> 02:49:30,923
will not, you know, issue legitimate certificates to,

2226
02:49:30,923 --> 02:49:36,523
I don't know, Russian hackers or whoever or Chinese hackers, you are going to

2227
02:49:39,583 --> 02:49:44,983
happen. I think that is another side of this coin that

2228
02:49:44,983 --> 02:49:50,763
people who kind of wanted to get

2229
02:49:50,763 --> 02:49:56,703
away from this, maybe not primarily wanted to get away from the rent

2230
02:49:56,703 --> 02:49:59,043
-seeking, they wanted to get away from authority.

2231
02:50:02,710 --> 02:50:07,470
Yes, I think also, I think I 100 % agree with all that.

2232
02:50:07,810 --> 02:50:12,410
The better way would have been for a name coin to like target like someone like Edward

2233
02:50:12,410 --> 02:50:18,070
Snowden, like quickly, and you could get him like, this is how you can

2234
02:50:19,643 --> 02:50:39,523
I actually have this weird idea that celebrities would like it. And this probably sounds really weird because what most people first think of is they think of celebrities are going to use something that's really flashy. It's really expensive. It's like very high status. Why would they adopt something nerdy and weird like this?

2235
02:50:39,523 --> 02:51:04,403
But I actually kind of think that they might because they must have a horrendous spam intake problem. You know, they must just get constant emails, phone calls. They have to constantly change their phone. So they would adopt it, honestly, just for the feature, which is that they would own their name. Because if you're a celebrity, your identity is like very important. You know, you don't want to get kicked off Instagram or these people getting de-platformed.

2236
02:51:04,403 --> 02:51:22,283
Anyone being de-platformed, which would like Edward Snowden kind of falls in this category. But even if you're just someone who is like a Milo Yiannopoulos, remember that guy? He had this like big cult he was building or whatever. But then he got kicked off of Twitter and then he was like no one has ever heard of him since or whatever.

2237
02:51:22,283 --> 02:51:50,164
But someone like that, a celebrity type person, they would get their name, their BitName. And then they would – the idea is they would have the name and then they'd have like their whitelisted friends who can contact them anytime. And then they'd have like the pay mail for the introductions. Like someone would pay $20 or $50. Or like if it's Taylor Swift or something, they'd pay maybe like $500 or $1,000 to send them like a little message.

2238
02:51:51,044 --> 02:52:04,044
And then that way they can always be reached, but they don't get any spam. They get no spam. And if you book a flight or whatever, they look you up based on your BitName. Obviously, this is like 10 years away of total integration.

2239
02:52:04,044 --> 02:52:20,924
But if you – there's never a reason to get any spam. There's people you've whitelisted with and then if you buy a concert ticket or if you buy – like they don't ask you to make an account. You already have an account everywhere because you have the name.

2240
02:52:20,924 --> 02:52:42,804
So if you just say at Paul Sztorc buys a ticket to this concert, if I buy a ticket to an NFL game, I can just go and I just type in my own – I type in my BitName when I get to like the kiosk or when I go wherever, however they do it or however they let you in.

2241
02:52:42,804 --> 02:52:59,684
And then it just looks me up and then it says, are you this person? I get a little notification on my phone. I like tap BitNames app on my phone or whatever and I just tap – I show them the code or whatever and then they just let you in. You don't even need like ticketing. You don't even need – you don't need anything. You don't need any account.

2242
02:52:59,684 --> 02:53:20,564
So this is kind of hard to explain because it's so different. But yeah, that was one thing that I thought that celebrities actually might – they might need it for the feature because I don't understand how they – how do they survive? Like if you're someone like, for example, Taylor Swift, how do you have like a phone number? I'm just curious about that. I would love if anyone knew the answer to that.

2243
02:53:29,684 --> 02:53:48,564
He says something like, a lot of people say they want to be rich and famous and he says, I always tell them the same thing. Try being rich and see if that doesn't do it for you. Being famous is really difficult, he says something like that. So that's the point of the quote is who wants to be rich? You don't want to be rich and famous. You only want to be rich and not famous.

2244
02:53:48,564 --> 02:54:03,444
And a lot of people find it annoying and I think – I just would love to know exactly how they operate like a phone or an email because I would just imagine it would just be overrun as soon as – they keep it secret for as long as possible and then it's overrun.

2245
02:54:03,444 --> 02:54:30,323
Weird thing about this though that all of this white listing can be done on your side. So like literally it's just software that can filter your email for you, that can filter your instant messaging for you, that can – I mean phones are a bit different, right? Because you can actually run a denial of service on someone if you try to call them and you get rejected.

2246
02:54:30,323 --> 02:54:45,203
So that's a different system. But on these internet systems, messaging systems, it's very easy to actually filter on your side. I don't think you need a global system for that.

2247
02:54:45,203 --> 02:54:55,203
Yeah, but you know that it's for the name. I agree. It's like BitNames, Namecoin sidechain plus like a telegram bot.

2248
02:54:56,083 --> 02:55:12,083
The other thing is I would expect – if I were to implement such a system, I would just simply use a global ledger to establish ownership and nothing else.

2249
02:55:12,083 --> 02:55:38,963
So basically I would just let everyone know that this is the public key that is authorized to update the distributed hash table entries and nothing else really. So I would just simply sign the distributed hash table entries and just broadcast them and that's how the whole thing would work. I would not put every operation on chain, right? Just the ownership transfers.

2250
02:55:39,044 --> 02:55:51,044
Yes, it's mainly the key. But there's a couple other things I think you might want in there as well. Like you probably want some other way of being contacted so that you don't have to be – exactly so that you don't have to be contacted on the blockchain.

2251
02:55:51,044 --> 02:56:10,083
Because if you're contacted on the blockchain, that's like 200, 300, 400 bytes minimum. But if you just say on the left – basically it's a table. On the left is Paul Sztorc and on the right is a little – only the hash will be in consensus.

2252
02:56:10,083 --> 02:56:36,164
But there will be some other place of looking it up. Someone else – there will be like a super node or like Google will just have it all just like you have the MIT PGP key server. But only the hash will be in consensus. So that's only whatever, 32 byte. But the data itself would still be something like a key, like a pub key or maybe even a Bitcoin address so that it's like a hashed key.

2253
02:56:37,123 --> 02:56:55,204
But the pub key would be there and maybe like your Telegram name would be there. Because you want – you actually want a way for – one thing you want is to be able to verify yourself. So if I contact you on Telegram, you say I'm the real moonsettler. Then I say how do I know that?

2254
02:56:55,204 --> 02:57:20,243
And then at least I have – I can look it up and I can ping you on Telegram and the bot, the Telegram bot can like – it can only show you like the six – the PIN code or whatever and then you just – you give me the PIN code and then I see that it matches the one that I sent you or just whatever. Because you want it to have some kind of – you want it to be doing some work. You want it to be – but yeah, the key is the big thing is the mapping the name.

2255
02:57:20,324 --> 02:57:22,324
Yes, yes.

2256
02:57:22,324 --> 02:57:48,324
To map it to an endpoint, right? So you need to map a name, a public name, a domain name. You need to map to an endpoint and from that moment on, you can serve everything really. You can authenticate with that public key. You make everyone know what public key is authorized to update these entries.

2257
02:57:48,403 --> 02:58:06,403
And then you can authenticate yourself and then you can serve everything else. You can combine this perfectly probably with ION, the ID system, and then you can have a lot of discretion over what data you share with whom, right?

2258
02:58:06,403 --> 02:58:21,444
You have encrypted Merkle trees of claims that are certified by authorities and you have freedom over what you share. You can combine this with zero-knowledge proofs. Did we lose Rinder?

2259
02:58:21,523 --> 02:58:41,523
I think so. But you're 100% right. I would imagine like a nested hash, nested Merkle tree type of a thing where if you go all the way – if you go like 10 nests deep, then it's like all your medical records are there maybe and only your family has that or whatever. That's just like planning it out too far.

2260
02:58:41,603 --> 02:58:57,603
But yeah, you're right. You map it to one thing. Some people want this to be like an IP address and like a name server type thing, but that's what I was saying is some people want it to be – maybe this is what you mean when you say an endpoint, but they want it to only be like the telegram screen.

2261
02:58:57,603 --> 02:59:03,684
But it can't only be the telegram screen name because then you're vulnerable to that. It really has to be –

2262
02:59:03,846 --> 02:59:09,366
this is why it needs the blockchain actually because it has to actually be you owning the actual name

2263
02:59:09,366 --> 02:59:15,846
itself on the left because if telegram decides – telegram admin decides to rug pull everyone and

2264
02:59:15,846 --> 02:59:20,246
start stealing people's names or whatever or charging you to use your name, you have to be

2265
02:59:20,246 --> 02:59:26,725
able to go into the Namecoin sidechain and say, I am the real Moon Settler and this is my new

2266
02:59:26,725 --> 02:59:31,206
telegram, this is my Nostr key, this is my whatever, this is my Twitter. Yeah, yeah. I wanted

2267
02:59:31,286 --> 02:59:38,726
to say Nostr fixes this and also DIDs, right? So DID is a more comprehensive fix to this whole

2268
02:59:38,726 --> 02:59:44,326
problem because you would not be known by your telegram handle, right? The telegram handle would

2269
02:59:44,326 --> 02:59:53,686
be maybe a part of your DID structure, but more importantly, you can actually be notably

2270
02:59:54,645 --> 03:00:00,166
identified on the platform by whatever part of your DID that you are willing to share and you

2271
03:00:00,166 --> 03:00:06,326
have full control over that. So at least you own your identity. They can just impersonate you

2272
03:00:06,326 --> 03:00:11,765
hopefully, especially if you do sign your events, right? On Nostr, it would be pretty hard to

2273
03:00:11,765 --> 03:00:19,606
impersonate someone without their private key if someone is known. I mean, I don't think that's

2274
03:00:19,606 --> 03:00:25,606
accurate in a way. I mean, I think that definitely if the Namecoin thing works, then under the hood,

2275
03:00:25,606 --> 03:00:30,246
your telegram name could just be like garbled characters and then humans wouldn't even see the

2276
03:00:30,246 --> 03:00:34,646
actual telegram name, so to speak. But I mean, I don't know if maybe by Nostr you just mean that

2277
03:00:34,646 --> 03:00:40,566
things or events are signed, then that would fix this. But I think Nostr actually, the weakness

2278
03:00:40,566 --> 03:00:47,286
of Nostr or one of the weaknesses is that everyone has, in order to friend someone on Nostr,

2279
03:00:47,926 --> 03:00:53,606
you need to know their giant garbled unreadable key and I actually think that that is part of what

2280
03:00:54,485 --> 03:01:02,725
the Namecoin sidechain idea would solve because you want to be able to just pronounce it out loud,

2281
03:01:02,725 --> 03:01:08,725
you know, like in a television commercial or in a whatever, you don't want to be able to go like,

2282
03:01:10,166 --> 03:01:14,726
it's just like, it just doesn't, the human readable thing has many advantages other than

2283
03:01:14,726 --> 03:01:20,806
being easy to remember and spell. If you did like Photoshop out a QR code and put a different QR

2284
03:01:20,806 --> 03:01:25,846
code in there, but if it's like canadiantruckers.bit, then it's not, it's more than just

2285
03:01:25,846 --> 03:01:31,125
being human readable, it's like that is the logical name that it would be or something,

2286
03:01:31,125 --> 03:01:34,885
you know, and then it's like if someone wants to say that one's fake, well then you can have

2287
03:01:34,885 --> 03:01:40,646
antibodies. Everyone can say canadiantruckers.bit is the fake one, but you can't do that if it's

2288
03:01:40,646 --> 03:01:44,325
a QR code or it's just unreadable garbled nonsense, so I actually think it's pretty big.

2289
03:01:45,045 --> 03:01:52,965
So in NOS currently, it's always centralized solutions that give you this namespace

2290
03:01:52,965 --> 03:02:02,245
thing, this human readable alias thing, so there is an authority and this can be Twitter or GitHub

2291
03:02:02,245 --> 03:02:10,965
or the server that you are using the client of and they can give you this human readable name,

2292
03:02:11,446 --> 03:02:19,206
but your real identity is actually your pubkey and that is something nobody can take away from you

2293
03:02:19,206 --> 03:02:25,125
and it's fairly easy. The reason we're talking about this is because the Namecoin sidechain

2294
03:02:25,125 --> 03:02:33,446
would map a human readable name that you own to that. Yes, exactly. So you don't have a central

2295
03:02:33,446 --> 03:02:42,166
authority anymore, so that is solved. I'm just saying that I think the other things are also

2296
03:02:42,166 --> 03:02:47,685
important, you having this flexibility and control over your stuff, so and that's why I think

2297
03:02:47,685 --> 03:02:54,726
basically the best way to approach it is to really just have a key, an ownership associated

2298
03:02:54,726 --> 03:03:00,885
with a public key and then you can update these distributed hash tables for your endpoint and

2299
03:03:00,885 --> 03:03:06,965
then your endpoint can serve your proofs and from that you are very much free and

2300
03:03:06,965 --> 03:03:11,605
that actually doesn't need to be on the blockchain, it seems to me, but of course we will see.

2301
03:03:13,286 --> 03:03:18,405
Well, it doesn't, yes, but don't you understand the benefit of the blockchain is the human readable

2302
03:03:18,405 --> 03:03:27,685
name for the key? Yes, I'm not disputing that. You have to answer some mysterious questions

2303
03:03:27,685 --> 03:03:32,486
like, you know, the internet that we use that has like google.com and facebook.com

2304
03:03:33,286 --> 03:03:39,205
that has human readable names, so it seems like people do like them, yes. Sorry, so maybe I was

2305
03:03:39,205 --> 03:03:47,685
not clear, I want the human readable name to be tied on a public ledger to a public key and that is

2306
03:03:47,685 --> 03:03:54,566
the ownership and from that we can basically take the whole thing off-chain and have a very

2307
03:03:54,965 --> 03:04:00,326
flexible and good experience off-chain because that is the crucial thing that actually needs

2308
03:04:00,326 --> 03:04:06,805
to be in a public ledger. Yeah, I completely agree, but I also think that there's some utility to

2309
03:04:06,805 --> 03:04:13,046
being able to return on-chain for some functions that would never actually, this would be used like

2310
03:04:13,046 --> 03:04:18,645
very rarely, but in the case of someone like being de-platformed they might want to sign a message,

2311
03:04:18,645 --> 03:04:25,925
like if they're de-platformed everywhere, they may want to use the Namecoin sidechain actually

2312
03:04:25,925 --> 03:04:31,606
as a kind of Twitter and it's unfortunate. I think this is partly related to what we were

2313
03:04:31,606 --> 03:04:35,446
talking about before where everyone went through the blockchain without bitcoin

2314
03:04:37,205 --> 03:04:43,606
phase in 2016 and it was so dumb that it dumbified everyone forever into thinking that

2315
03:04:43,606 --> 03:04:49,606
any use of a blockchain must automatically be the worst idea to have ever been invented,

2316
03:04:49,606 --> 03:04:55,046
but this is a similar thing where no intelligent person says every single tweet should be

2317
03:04:55,046 --> 03:05:01,446
on the blockchain, that's a ridiculous idea, but actually in the one moment when you're de-platformed

2318
03:05:01,446 --> 03:05:07,925
from everything you may want to be able to sign and globally broadcast one big message that's

2319
03:05:08,486 --> 03:05:14,645
by big I mean like 400 bytes, so really really small, but it just says something like here's my

2320
03:05:14,645 --> 03:05:19,766
new Twitter, here's my new Telegram, here's my new email, here's my new everything, here's my new key

2321
03:05:19,766 --> 03:05:26,965
or whatever it is, so in that case it may as a fallback may be sort of invaluable. Anyway, we have

2322
03:05:26,965 --> 03:05:35,925
a hand up, yes? Bitcoder, please share your question. Guys, I want to share my thoughts about where

2323
03:05:36,645 --> 03:05:42,245
I see the blockchains in the future and also ask you what do you think about my

2324
03:05:43,205 --> 03:05:50,645
my view about blockchains. I think that and also this is important for the drivechains because I

2325
03:05:50,645 --> 03:05:59,286
think there will be the main driver of this, like I think that and this is my thoughts from

2326
03:05:59,286 --> 03:06:06,085
a long time ago when I discovered Bitcoin, maybe 14 years ago. I thought that one time

2327
03:06:06,085 --> 03:06:14,245
blockchain will replace the old IT infrastructure as a base layer, so I think that and this is also

2328
03:06:14,245 --> 03:06:20,085
I'm adding on your conversation about the shares and you know issuers and stuff like that, so like

2329
03:06:21,046 --> 03:06:29,365
the I see the blockchains like that everybody, companies, institutions and whatever they are

2330
03:06:29,365 --> 03:06:34,805
centralized or decentralized, by the way I'm strongly supporting decentralization and first

2331
03:06:34,805 --> 03:06:46,486
principles of crypto and I see them like using sidechains and whatever they want to do, how they

2332
03:06:46,486 --> 03:06:52,166
want to be centralized, decentralized is their way, but actually the most important thing

2333
03:06:53,846 --> 03:07:01,525
is that they will use the decentralized security from the most decentralized blockchain Bitcoin

2334
03:07:01,525 --> 03:07:10,085
Bitcoin blockchain, so what do you think? Do you see this happening? Do you believe in this or

2335
03:07:10,726 --> 03:07:12,645
it's something that the first part

2336
03:07:14,566 --> 03:07:20,006
the obviously the most like the most decentralized this you want to have a small block

2337
03:07:21,446 --> 03:07:25,685
layer one you want to have a layer one be small blocks be very simple

2338
03:07:26,965 --> 03:07:34,805
not change too much and have high hash rate and have like global permeability or whatever but

2339
03:07:34,805 --> 03:07:39,846
then what were you saying would be on top of it I didn't understand yeah yeah using using

2340
03:07:39,846 --> 03:07:50,885
drivechains as a as a sidechain for main for main operations but then as you you said the

2341
03:07:50,885 --> 03:08:00,565
the BIP300 and BIP301 the the security and the transactions will be validated on the main chain

2342
03:08:01,445 --> 03:08:07,205
I think he's expressing the drivechain view in a summary which is yeah yeah yeah in drive

2343
03:08:07,205 --> 03:08:13,046
chain in drivechain we have the Bitcoin base layer that's the main chain and it has small

2344
03:08:13,046 --> 03:08:19,525
blocks and it has stability and it has a monetary policy we all know and then every other blockchain

2345
03:08:19,525 --> 03:08:24,726
in the world would be a sidechain that has the same monetary policy as Bitcoin it shares Bitcoin's

2346
03:08:24,726 --> 03:08:32,005
monetary policy no inflation but new features and a different layer a different level of security

2347
03:08:32,005 --> 03:08:37,366
and decentralization than the main chain so it's a different experience except you're using the

2348
03:08:37,366 --> 03:08:45,765
same miners and you're using the same monetary policy yeah yeah so that's yeah that's our view

2349
03:08:45,765 --> 03:08:50,486
every single blockchain in the world would then be paying fees to Bitcoin miners and sharing the

2350
03:08:50,486 --> 03:08:55,846
same miners and every blockchain in the world would be a Bitcoin sidechain and it would have

2351
03:08:55,846 --> 03:09:03,126
its own layer of its own level of security from the fees on that sidechain and its own level of

2352
03:09:03,126 --> 03:09:12,726
decentralization based on the block size of that sidechain yeah yeah because did like this is the

2353
03:09:13,366 --> 03:09:18,325
this is the thing that I believe in the future every company even maybe individuals who

2354
03:09:19,286 --> 03:09:26,246
will have their sidechain or blockchain a small blockchain that you know you can you can do

2355
03:09:26,246 --> 03:09:31,926
as a sidechain but actually you are secure because you are using the the Bitcoin blockchain

2356
03:09:33,366 --> 03:09:42,565
as a base layer so I think that the old IT infrastructure with what is centralized at

2357
03:09:42,565 --> 03:09:50,486
the moment I think will be replaced with with sidechains that uses the Bitcoin blockchain as

2358
03:09:50,486 --> 03:09:56,885
a base layer well said yeah that's our view Paul do you think we should continue today we've been

2359
03:09:56,885 --> 03:10:01,686
going for three hours now we could continue if you'd like or we could resume on Monday this is

2360
03:10:02,325 --> 03:10:10,806
our what do you feel oh um I think we've been going for a while I guess I don't know

2361
03:10:10,806 --> 03:10:16,965
maybe we should demand I don't know if the audience will do final questions

2362
03:10:18,405 --> 03:10:23,046
today's been a great space thank you everyone who's listened and welcome to those who are new

2363
03:10:23,046 --> 03:10:29,046
this is Drivechain Twitter Spaces hosted by LayerTwo Labs we speak every Monday and Friday

2364
03:10:29,046 --> 03:10:35,606
on Twitter Spaces about Drivechain that's Bitcoin Improvement Proposal 300 and 301

2365
03:10:36,486 --> 03:10:41,046
and we're going to have our next one on this Monday so just in a few days from now today's

2366
03:10:41,046 --> 03:10:47,286
been a three-hour space usually we just go for an hour and a half um are there any final questions

2367
03:10:47,286 --> 03:10:51,846
from the audience you can come up and ask your question or final thoughts from Moon Settler

2368
03:10:55,046 --> 03:11:01,846
Moon Settler are you ready to announce or have you are you still are you still considering and

2369
03:11:02,405 --> 03:11:09,525
analyzing we hope one day you will decide that it's time to fully and emphatically support

2370
03:11:09,525 --> 03:11:15,286
this proposal without the support of the technical community members like you

2371
03:11:15,846 --> 03:11:19,765
this idea can't be adopted we need the support of people like you

2372
03:11:21,926 --> 03:11:25,445
maybe we need to wait basically no I'm just kidding

2373
03:11:25,606 --> 03:11:35,765
yes so I just wanted to again reiterate that I think we should um I don't discount blockchains

2374
03:11:36,645 --> 03:11:42,166
because they do a few things like I said when you have to make consensus critical data available in

2375
03:11:42,166 --> 03:11:48,965
a decentralized setting and when you want to solve for the interactivity because it's very easy to do

2376
03:11:49,525 --> 03:11:57,846
and basically byzantine proof systems in the world but not in the way and of course blockchains

2377
03:11:57,846 --> 03:12:03,765
not really byzantine proof they don't solve the byzantine general problem anyone that says bitcoin

2378
03:12:03,765 --> 03:12:09,445
solves the byzantine general problem is wrong I think bitcoin is a proof that you don't need to

2379
03:12:09,445 --> 03:12:14,806
solve the byzantine general problem that's a more correct way of putting it but you can actually

2380
03:12:14,806 --> 03:12:21,765
solve the byzantine general problem in distributed systems if you don't mind interactivity so

2381
03:12:21,765 --> 03:12:27,046
basically blockchain gives us no interactivity and and gives us data availability consensus

2382
03:12:27,046 --> 03:12:31,926
critical data availability those are the primary functions and we need to look at

2383
03:12:31,926 --> 03:12:37,846
the stuff we want to do we need to look at what is the core that that needs these properties and

2384
03:12:37,846 --> 03:12:45,525
what is that don't need these properties and a little bit sounded to me that there are actually

2385
03:12:45,525 --> 03:12:50,806
some people who want to put everything on blockchains and and again I don't believe in that

2386
03:12:51,525 --> 03:12:57,525
but I also don't believe in the notion that blockchains are completely useless and we just

2387
03:12:57,525 --> 03:13:03,286
don't need them and we should get rid of them so I'm between the two extremes basically

2388
03:13:03,525 --> 03:13:11,366
well said very well said all right our last speaker our last question or comment will come

2389
03:13:11,366 --> 03:13:19,126
from crypto voyager welcome to the stage your question or comment thank you very much I have

2390
03:13:19,126 --> 03:13:26,325
a question since since the drivechains how many drivechains could I have actually then

2391
03:13:26,325 --> 03:13:32,005
on whatever layer you want using using the bitcoin blockchain that's a great question

2392
03:13:32,005 --> 03:13:38,726
you can have that be calculated there can be set up for 256 which is the size of one byte

2393
03:13:39,525 --> 03:13:45,765
its ability to count but actually you can have sidechains of sidechains or you can just

2394
03:13:46,885 --> 03:13:53,926
add 300 again and add another 256 so the real number is unlimited

2395
03:13:54,246 --> 03:14:01,126
thanks for the question all right that's the end of our space today we invite everyone to

2396
03:14:01,126 --> 03:14:06,885
continue the conversation in drivechain talk to the telegram group with over 700 members

2397
03:14:06,885 --> 03:14:13,126
talking about drivechain you can find it if you go to drivechain.info and then look at the links

2398
03:14:13,126 --> 03:14:18,726
one of the links is for the telegram group we also have a great youtube channel with many videos of a

2399
03:14:19,205 --> 03:14:26,166
videos of a very advanced and both and also some elementary level videos at LayerTwo Labs

2400
03:14:26,166 --> 03:14:33,286
youtube channel and you can find that link if you go to layer2labs.com that's LayerTwo Labs with no

2401
03:14:33,286 --> 03:14:38,965
number just letters layer2labs.com scroll to the bottom and you'll see our youtube channel link

2402
03:14:39,765 --> 03:14:44,486
and of course if you're technically ambitious please download our software and run the drive

2403
03:14:44,486 --> 03:14:50,806
chain testnet code on your own computer and interact with the sidechain software that's

2404
03:14:50,806 --> 03:14:58,166
been developed and you can also go to the LayerTwo Labs github page and at the LayerTwo Labs github

2405
03:14:58,166 --> 03:15:05,846
page you can see the drivechain code and the code for the sidechains and it's very exciting

2406
03:15:05,846 --> 03:15:10,565
thank you all for being here this is a recorded space you can listen to the whole thing on demand

2407
03:15:10,965 --> 03:15:14,405
we'll see you on monday for our next one we do these twice a week

2408
03:15:15,606 --> 03:15:22,812
thank you so much moonsettler and everyone else who asked questions