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Welcome in to This Week in Bitcoin, episode 117.

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My name is Chris, chrislas.com and jupiterbroadcasting.com.

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This has been a week.

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In fact, it kind of feels like one long day since I saw the cold card news was breaking.

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So if you missed episode 116 and you're a cold card user, you need to catch up on that

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episode.

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You need to act.

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And I'm going to give you a big update on that this week.

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So it'd be good to kind of be current on that, at least as far as episode 116 went.

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But to be honest with you, I need to warm up with something a little simpler, something

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a little easier on the nervous system to just kind of get us rolling.

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Currency bailouts and central banks.

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Now, kidding aside, this really does set the scene for the week, and it really does matter.

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The big item is the U.S. stepping in to support the yen.

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The yen had fallen to a multi-decade low near 164 USD to JPY in late July.

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Now, the yen has faced a long-term structural downward trend.

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This is not new.

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It's been really happening since the late 90s.

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But there has been accelerated weakness, you could call it, that's really intensified this year, driven in large part by interest rate differentials between Japan and the U.S.

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And can you guess what else?

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Energy prices.

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The Iran war.

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It's made the situation worse.

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If you're interested more in kind of the yen carry trade stuff, I recommend you search the back catalog because we do have more information about that.

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But what's important for you to understand this week and for this episode is that Japan is currently the largest holder of U.S. treasuries and has been for several years.

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The United States has joined Japan in a rare coordinated intervention in foreign exchange markets.

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The move aims to stabilize the yen after it hit a four-decade low.

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Sol Eslake is an independent economist and he joins me now from Hobart.

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Solis, great to have you with us to explain all of this. What is this intervention we're

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talking about here? Well, as you said, it's highly unusual. 40 years ago, the United States, Japan,

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Germany, the UK and France combined to intervene massively in currency markets to drive the US

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dollar down after it had appreciated massively during Ronald Reagan's first term. And then two

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years later, under what was known as the Louvre Accord, the same powers intervened massively in

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currency markets to push the US dollar back up after it had depreciated substantially as a result

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of the Plaza Accord initiated two years earlier. But since then, we've rarely seen major intervention

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by the US and other Western powers to move currencies. Really, only that's happened during

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financial crises like the GFC or briefly at the early point of COVID. There has been one

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recent precedent where the Trump administration has intervened in support of the currency of one

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of its allies, and that was in Argentina late last year, ahead of elections which President

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Millay in Argentina appeared at risk of losing in the Argentine Congress.

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Now, it seems to me to be the red flag here is it's obvious what they're doing, but they're gaslighting us about the reasons for this move.

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That's the red flag.

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The intervention is being framed as sort of this signal of friendship by the United States.

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But it's really about deeper financial stress.

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Mr. President, why is the U.S. intervening to support the Japanese currency?

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at this time? To support who? To support the Japanese currency. Because we have a good

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relationship with Japan. We're very strong, very, very strong financially. They are, you know,

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they have a weakening yen and they wanted a little bit of help. And we're always there for

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Japan. Japan's been very good to us, with the exception, of course, of Pearl Harbor.

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Mr. President.

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I just that that clip gets me.

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I get this guy.

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So he's framing it as like, oh, well, we're good friends.

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We're good friends.

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That's why we're doing it.

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We've got a good, strong relationship.

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The reality is, and everybody knows this, this is not a secret.

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The U.S. is trying to prevent Japan from dumping U.S. treasuries.

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That would spike our own yields out of control, which are already in the red zone.

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So what we're really doing here is setting the stage for rising U.S. bond yields and market volatility.

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And they're trying, in their attempt, they're trying to get ahead of it.

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Treasury Secretary Scott Bessent weighed in during a kind of interesting off-the-cuff Q&A.

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And, you know, he dismissed concerns about the yen.

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In fact, he thinks it's a great deal.

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I'm going to ask you about Japan.

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It seems the Japanese intervened in their markets, in their currency markets, earlier today.

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What do you, do you have a response to that?

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Well, again, we think that excess volatility in the yen isn't healthy.

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And I was in the currency business for 40 years, and Japanese yen seems very undervalued to me.

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The currency is very cheap.

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The economy is doing well.

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The prime minister is very popular and enacting very strong policies.

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And I think we're going to see the fundamentals come through at a point that the market will realize the yen is undervalued and should strengthen.

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So you're not legitimate question. Does anybody have any idea what this guy's talking about? The yen has been in a 30 year funk. How is it? I mean, how does any of it really if you know what he's talking about, boosted and tell me because he thinks to think it's a great deal, which is just ridiculous.

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this. I just I'm dumbfounded by that. It looks to me like a really bad deal. It looks to me like a

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desperate plea to try to, you know, patch a few different things right now. I mean, I don't know.

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That's a that's a pretty weak argument. So if anybody has anything on that.

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I can't understand it. And it looked initially like the intervention wasn't working,

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but then another bump came along from the U.S. and things have started to improve.

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but when you zoom out on the yen chart, it looks real bad. It still looks real bad. So

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temporary patch is my read. The administration is betting that they can wrap up the war with Iran

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and ease the macro pressure on the yen. And they're hoping this move buys them some time,

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but it's not a fix. Because the other issue is, this is impacting the yen in Japan,

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is we've got these two central banks. They like to jibber jabber, but neither one of them have

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taken any action recently. The bank of Japan keeps talking tough and it did raise rates once.

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But it held them steady at their last meeting at the end of July.

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And the U.S. Federal Reserve has held rates post-warsh steady two meetings in a row now, which is adding pressure to the yen carry trade situation in the yen.

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And people are getting impatient.

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They want a damn rate change one way or another.

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I have a clip from the Q&A from the last Warsh song and dance that kind of shows us this.

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Why should rates not be higher today?

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Rates are higher today than they were 42 days ago.

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markets have made decisions because we step back in part from trying to influence those

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market judgments have moved up on what nominal rates are across the treasury curve that doesn't

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mean we take them as by dictation but we're observing them so i think it's a mischaracterization

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to say that markets haven't reacted because we didn't move today markets are reacting in real

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time. This is it's actually just a horrible answer and it's not doing it for people. He's basically

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saying, well, the market's raising rates for them, so we don't need to do anything. We can just sit

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here and monitor the market. And then he takes credit for that. That's not the answer people

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want. And the question around inflation, well, they're getting more aggressive as time goes on.

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Hi, Anne Safir with Reuters. Nice to see you again. So I need a little help here, too. You've

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said repeatedly you have no tolerance for inflation And yet we are seeing above target inflation repeatedly for five years and through your term so far And sure you have no magic wand but you have not taken action

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You just gave us a little peek at your reaction function as well.

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You said that if underlying inflation is rising, that you would tend to think that you might need to tighten.

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And with the exception of the most recent inflation print, that is what we've been seeing.

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So could you explain what you mean by no tolerance for inflation and what you plan to do about it?

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Sure. So, Anne, I hear from you what I hear more broadly from households and businesses.

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Impatience. Deliver it already.

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This is not an excuse. This is a fact.

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this FOMC, this board has been in business for eight and a half weeks.

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The patience, the impatience that households and businesses feel have been going on for 63 months.

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We are on the job. We will deliver. We are focused like a laser on making sure we can do it.

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But the suggestion that we're going to be able to do it with our magic wand is one I want to

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disabuse you and everyone else of. But the discussion in the last two days give me more

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confidence even than I had eight and a half weeks ago. See, what the issue here really is,

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is that Warsh comes along and tells us that, you know, business is going to be just as usual. We're

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maintaining things. You know, it's new leadership, but we're a family. Sometimes we disagree,

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but it's a robust conversation and we're keeping the train on the tracks. And then the next question

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comes along and his response is, well, look, we're new at the job. We're only eight weeks in. You

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can't expect us to fix inflation in eight weeks. So which is it? Is it a continuity of governance

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at the Federal Reserve that is responsible for a continuous line of events? Or is it every time we

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get a new Fed chair, we hit the reset button? That doesn't seem to make much sense to me.

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So Worsh's answer here sucks so far. This team that we have at the FOMC,

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the support that we have from board staff and the new hard questions we're asking,

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we need to resolve those. And as we resolve those questions, get smarter on those,

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we're going to deliver on the remit. You don't have to take my word for it. If you look broadly

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at market prices, they are certainly not saying all clear, but they are working in concert to

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keep us on our toes. And they have tightened financial conditions in this intra-meeting

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period. And, and that has given us, that has provided us some, some, some comfort that,

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that we've got the ability and capability to deliver. What? And, and, and is your read or your,

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I guess, faith in markets ability to sort of make a judgment and then you to take signal from that

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judgment. How does that affect you when you come up on the September meeting and markets

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are seeing a near 100% chance of a rate hike as they see now? How does that

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feed into your decision making and your thinking?

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So we're not going to be constrained by market prices. We're not going to be constrained or

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take verbatim from what the market's doing. But I think it's useful and to understand that markets

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can be a very good source of information, not a determinative source, not a perfect source.

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But if...

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See, this is what I mean when I say they just jibber jabber. What he's doing here is he's saying,

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well, look, maybe the markets have got it right. Maybe we're going to be tough and they're pricing

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it accordingly. And by doing so, they're fixing things. So just by me jibber jabbering and

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implying that we may raise rates. The market then forecast that and they price and raise rates.

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And now I don't have to. Aren't I a genius? But the answer is actually he's done nothing.

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And I kind of, you know, I guess I suppose the principle I agree with the Fed should not be

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leading the market. The market should be leading the market and the Fed should be monitoring and

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responding in theory, I guess, if whatever. But what a bunch of hogwash that is. What a bunch of

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crap that is. The expansion of the currency is what drives the stock market. Overlay M2 money

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supply with the S&P 500. Go look at that. So like, stop BSing us, right? Like, or he's out of touch,

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which I doubt. Kevin is very, very rich. He knows how this works. He knows how the contillion effect

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works. He's testified to that. So he knows what's going on here and he knows what the market's going

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to be watching and not watching. So you look at these issues, you look at the problems with the

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yen, the U.S. bailing out their biggest customer, like the central banks that are trapped between

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a rock and a hard place and can't do anything because if they raise rates, they blow up the

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AI trade and probably inflation goes crazy. If they lower rates, inflation definitely goes crazy.

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You know what I mean? Like, because people get laid off in one scenario, inflation may go up.

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I know the whole thing is just a mess. So they're really stuck between a rock and a hard place.

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legitimately. It's a fair analogy. And you would think if you just considered these two issues

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and not all the other systemic problems, just these two issues alone make the thesis for Bitcoin

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stronger than ever over the long run. And each twist of history recently seems to be slowly

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creating the pathway for a sovereign nation market for Bitcoin eventually, because they're

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going to have no other choice. And if that's not enough to make you feel bullish long term,

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well, Jim Cramer selling all of his Bitcoin should. I have some crypto. When I think about

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the equations that people tell me could never be cracked to get to my crypto, it sounds to me like

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the University of Chicago announcement. Should I be more careful? I think that you should give

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yourself three or four years. And at that point, I would get rather paranoid about it. Really?

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three or four years.

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That's not that long.

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No, that's not that long.

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Oh, boy.

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No, I realize some way.

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And Ethereum, really, maybe even worse.

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So I think that people have to take this man seriously

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because they're doing commercial quantum.

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And this Chicago study basically cracked a number.

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It did an equation that no one felt could ever be solved.

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Right.

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Isn't that also what you think about Bitcoin?

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Now, there'll be people in Bitcoin who say, look, I don't know what you're talking about, Jim.

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You don't know anything.

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I don't have to know anything.

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I ask the questions.

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I didn't give the answer.

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Arvin Fisher knows quantum incredibly.

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He knows Bitcoin and quantum.

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I'm going to sell mine.

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You are?

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Yes.

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Really?

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Just on what he said?

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Well, he's the man.

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He's the man.

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Three.

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So there you go.

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This is where Kramer gets his information from, a salesman, the CEO of IBM, the current CEO of IBM.

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And the study he's talking about, we've debunked.

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It was all theoretical.

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The hardware to actually produce the results doesn't exist.

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Incredible signal there from Jim Kramer.

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Just, oh, man, love it.

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OK, let's follow up on this cold card story.

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I tried to break the news as fast as I could last week.

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within the first hour of hearing legitimate reports,

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I tried to verify it as fast as possible.

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I started the process of moving my funds off of my cold card.

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And while I was waiting for block confirmations,

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I recorded TWIB 116 and published as fast as I could what I knew.

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Since then, I mean, I must have answered over 200 questions or more

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from people coming in.

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And I've been helping friends and family move their funds

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and trying to closely monitor the situation

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so I could try to give you the most important update possible.

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So here's where things stand as of April, or I wish, August 5th, but more appropriately, Blockhite 961,196.

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We know that the first sweep of cold cards took about 40 minutes.

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It happened within just 40 minutes.

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Tragically, we also know that most of those wallets had never spent.

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They'd only stacked for years.

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And the majority of those wallets were not huge.

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Now, there were a couple that were like 18 Bitcoin and such.

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But most were clearly pleb wallets with one or two Bitcoin or less and that really hurts We also learned that CoinKite was likely warned multiple times about their random number generation process

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The information we have publicly now seems to indicate that they brushed those reports off,

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and sometimes were even aggressive in doing so.

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A few heroes have emerged in this space, spending night and day helping people in projects.

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Rob Hamilton from Anchor Watch, who has been jokingly called the CEO of Bitcoin this week, has truly been a hero.

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And he shared some details about the initial attack wave on what Bitcoin did.

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So when I first saw this, I assumed that it was a Lazarus North Korea type hack, very sophisticated.

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But I've read some stuff online that says it's maybe a bit of an amateur doing this, doesn't really know exactly what he's doing, but still managed to exploit this bug.

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the first the first attacker was i would say an amateur um there's a lot of on-chain heuristics

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of what you could tell in the movement patterns they only moved bitcoin addresses that were more

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than 0.15 bitcoin why someone wouldn't run a little extra logic and just get 0.1 bitcoin at

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six thousand dollars for no extra cost really that's weird they did not properly scan full

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addresses so people were getting hacked and they still had funds that were sitting in the addresses

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was that i did see something about that was it because it was only looking at like the

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the first 200 utxos or something like that it was looking uh what it was doing is looking for the

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first gap so if you create an address and you didn't use it and then you made another address

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and you use that second address the moment the bot saw that there was no more addresses it stopped

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looking uh and this is initially would have kept you safe but this is going back to the point now

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there are multiple attackers now executing this and i'm assuming they're getting more and more

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sophisticated so like that's it and that's why you can see different on-chain movements and seeing

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different wallets being used um different transaction behaviors you can just tell by

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some basic fingerprinting that different actors are going about this that makes sense so but this

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is something you can do trivially like i could do it on my laptop if i had like the skills yeah

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uh there are reports of white hat hackers which is people who are trying to do it for the good

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who started seeing this exploit started running code and came into dozens of bitcoin and they

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swept them because they were trying to do they'd rather at least try to find a way to give it back

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to the right owner and then try to uh let an attacker take it so people will be in a panic

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hearing this if they're using a cold card. I want to talk about some of the other devices,

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because cold card was initially like a fork of Trezor. And since then, Foundation has forked

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cold card. Are those other forks from the same thing safe from the same original source code?

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Yeah. Neither Trezor nor Foundation use the library that was compromised with the cold card.

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Okay. So basically anywhere is safe apart from cold card right now. This isn't like a broader

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self-custody attack, this is a specific cold card.

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The use of this library was specific to cold card, or realistically mainly cold card.

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Yeah, I want to get more into that in a moment. But I think to help understand what really

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happened here, we should probably zoom out for folks that are just kind of coming up to speed.

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The Bitcoin Policy Institute put out a video that really breaks down the basics of what went wrong.

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A Bitcoin wallet is protected by a seed phrase,

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a list of words that acts like the master key to the wallet.

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If someone discovers that phrase, they can take control of the Bitcoin inside.

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So what stops an attacker from simply guessing it?

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The answer is the number of possible seed phrases.

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A properly configured Bitcoin wallet chooses its seed from an incomprehensibly enormous pool.

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The larger and less predictable that pool is, the harder it is for an attacker to search.

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This is where randomness matters.

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The wallet needs a reliable source of randomness so that no one can predict which seed it will choose.

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But in affected cold card firmware, a bug caused the wallet to use a more predictable software generator.

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The seed phrases still looked random to their owners, but they were being selected from a much smaller set of possibilities.

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To understand how much smaller, let's turn those possibilities into something we can compare.

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We will let one atom represent one potential Bitcoin seed phrase.

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Somewhere in the full collection is one key atom, the seed that unlocks the wallet.

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We begin with a single atom, representing a single possible seed.

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Now zoom out to a protein.

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A protein contains about 2 to the power of 10 atoms.

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If this were the entire pool, a computer could test every possibility and find the key atom

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almost instantly.

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Zoom out again to a large virus, containing about 2 to the power of 30 atoms.

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In our simplified model, every potential Bitcoin seed phrase created by the affected cold card

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firmware fits inside this virus as atoms. A computer could search that full set in about

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three hours. That may sound enormous, but how does it compare with the search pool of a correctly

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generated 24-word Bitcoin seed phrase? Would it fill a grain of sand? A grain contains about 2

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to the power of 60 atoms. Not even close. What about Jupiter? At roughly 2 to the power of 180

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atoms, it is still nowhere near large enough. The entire Milky Way contains roughly 2 to the power

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of 225 atoms. Surely that must be enough. Not quite. A properly generated seed has 2 to the

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power of 256 possibilities. To represent every one of those possibilities with an atom,

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we would need about 2 billion galaxies the size of the Milky Way.

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To hack a properly configured Bitcoin wallet,

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an attacker would need to find one specific atom

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hidden somewhere across those 2 billion galaxies.

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That is the scale of the cold card bug.

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It reduced the challenge from finding one atom across 2 billion galaxies

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to finding one atom inside a large virus.

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i think that really puts it into perspective um so a massive catastrophe and what strikes me is

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the initial information and reactions were contained to social media and podcasts like mine

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when we have an actual organic event within bitcoin which i kind of consider this to be one

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i.e something that isn't from like an outside influence or macro event but something that

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happens locally to Bitcoin. The information spreads quickly to the perpetually online,

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but there's a massive, massive lag between perpetually online and breaking outside that

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bubble. And I, I am left with the idea that that means tens of thousands at least that don't even

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know this has happened. It really, it really, it really, it strikes me. And so this is a scenario

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where the mainstream media stepping in can actually be useful because they can get it to

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that next echelon of people that can spread the word. Of course, how they cover it is just awful.

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How did this happen? I mean, I was reading about one of the victims here and he said his

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part of the system was in like a safety deposit box at a bank.

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Yeah. I mean, people had the perception that if you have a cold wallet, that it's secure. And I think this is kind of upended that impression. There was a security flaw in CoinKite's system that someone, it seems, might have even hacked into it all the way back in April times. But then the news kind of blew up over the weekend because a lot of other users were complaining about their accounts getting drained. And so they have a whole mess on their hands now.

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Oh, man, that has to be the most tech.

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Honestly, if they would have given her a script produced by ChatGPT, it would have been less slop than that.

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I mean, that's how bad that was.

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That was really bad.

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Some of the other mainstream media, that was Bloomberg.

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Shameful, shameful, Bloomberg.

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You should do better.

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You're a financial network.

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The CBC has done slightly better coverage and maybe in part because CoinKite was a Canadian company.

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Bitcoin worth more than $100 million, allegedly stolen from devices called cold wallets.

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You were told that moving your crypto onto a cold wallet was the safest thing you could possibly do but thousands of people just had their funds stolen Made by Canadian company CoinKite the cold card was sold as a way to keep Bitcoin secure by keeping a type of password or seed stored physically instead of on the Internet

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But thieves apparently found a five-year-old universal weakness in the cold card.

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They were able to reverse engineer it, figure it out, and therefore get access to the wallets and drain individuals' Bitcoin accounts.

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In an online post, CoinKite wrote, users have suffered real losses and also suggested users move their crypto off affected cold cards.

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This might be safe if it worked as advertised, but it didn't.

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And it didn't for five years.

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And now a lot of people know that.

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So that's the problem.

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It's not just the fact that this shouldn't have happened and that these people did nothing wrong.

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It's also that it strikes at the core of the Bitcoin ethos that you can store these keys yourself securely, that cold card was trusted.

324
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It's not clear who or where the hackers are, and victims may not be able to get much from the cold card company.

325
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You can't sue us and win more than you paid for the device.

326
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And the problem here is the device is worth at most a couple hundred dollars.

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Like this is like a really expensive calculator in terms of the money that's involved here.

328
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There's also speculation this is a new type of attack.

329
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AI is stronger than it's ever been.

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And it's being used by both attackers and defenders alike to identify vulnerabilities across all companies.

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While some victims have said they've reported their losses to authorities as theft,

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it remains very unclear if anything can be done.

333
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Anis Hadari, CBC News, Toronto.

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I think I'm still in shock, really, over all of this.

335
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You know, and it was such a monumental failure.

336
00:27:50,442 --> 00:27:56,022
I think it's really a black swan event for the most serious Bitcoin holders, and it's still ongoing.

337
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We just, as a community, screwed up so big.

338
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And we're still putting everything together.

339
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There's still a lot of questions, like, why is all this kind of just going to, like, one address?

340
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What's the plan here?

341
00:28:06,342 --> 00:28:10,322
supposedly they use some commercial blockchain services that might have been KYC'd.

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But what we do know is the cold card had a good and tested hardware and it could generate random

343
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numbers. We do know that. But the hardware number generator was being bypassed and a

344
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micro Python number generator was being called that wasn't nearly random enough.

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We have more information in this last week's episode of Linux Unplugged, where we kind of

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break this down technically in linuxunplugged.com slash 678. And we also get into some historical

347
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times where Linux screwed this up and what Linux had to do over the years to make its random number

348
00:28:40,482 --> 00:28:47,302
generation actually reliable. And it's relevant to this week. So linuxunplugged.com slash 678,

349
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if you're curious about that. Every key generated using that Python script was exposed the day they

350
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set up the wallet. That's what's such a mind bender. This has been lurking for five years.

351
00:29:00,142 --> 00:29:02,242
And the worst part, think about this, the worst part.

352
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If CoinKite had found out ahead of time and then had to disclose it when they released a firmware update or updated their GitHub, there would have been a race then.

353
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The AI tools would have been fired up and put to the task, and everyone would have had to scramble.

354
00:29:18,962 --> 00:29:25,422
It's an ironic twist that we would have been nearly in the same spot we are now, if not perhaps with more lead time, hopefully.

355
00:29:25,922 --> 00:29:28,542
Maybe CoinKite could have said, hey, update your firmware, we're going to tell you why soon.

356
00:29:30,142 --> 00:29:33,982
from where I sit as a podcaster,

357
00:29:34,062 --> 00:29:36,342
I think that Bitcoin influencer community needs to do better.

358
00:29:37,882 --> 00:29:40,922
To be clear, I don't think it's any one particular podcaster

359
00:29:40,922 --> 00:29:41,742
or YouTuber's fault.

360
00:29:41,842 --> 00:29:44,122
This is CoinKite's fault.

361
00:29:45,462 --> 00:29:48,462
I mean, there is a reality, though.

362
00:29:48,522 --> 00:29:51,482
Too many Bitcoin content creators just trusted and never verified.

363
00:29:51,662 --> 00:29:54,742
And worse than that, they bent to pressure by MVK and CoinKite

364
00:29:54,742 --> 00:29:58,082
to talk crap about other wallets and feature them less.

365
00:29:58,082 --> 00:30:02,082
and many of them took money from CoinKite to market the cold card,

366
00:30:02,202 --> 00:30:04,602
which once you do that, to keep that ad deal,

367
00:30:04,942 --> 00:30:07,242
it means you talk less about the other wallets.

368
00:30:07,522 --> 00:30:09,562
And I know that for a fact. I'll get into that in a second.

369
00:30:09,902 --> 00:30:12,902
But first, you need to get your head around this.

370
00:30:14,442 --> 00:30:16,062
And I don't want to have to repeat myself.

371
00:30:16,662 --> 00:30:19,742
You have got to be more mindful about your sources of information.

372
00:30:20,182 --> 00:30:23,402
Even well-intentioned Bitcoiners here bent the knee to cold card for sponsorship.

373
00:30:24,762 --> 00:30:28,002
I hate to say it, but you've got to understand it's so tempting

374
00:30:28,002 --> 00:30:28,902
as a podcaster.

375
00:30:30,062 --> 00:30:31,842
I mean, until this week,

376
00:30:31,962 --> 00:30:33,702
CoinKite and ColdCard

377
00:30:33,702 --> 00:30:34,722
seemed like a safe bet.

378
00:30:34,822 --> 00:30:36,842
So who cares if you talk less

379
00:30:36,842 --> 00:30:37,782
about the other wallets

380
00:30:37,782 --> 00:30:39,162
because you're recommending ColdCard

381
00:30:39,162 --> 00:30:39,902
and that's great.

382
00:30:41,082 --> 00:30:42,802
But as a result of this

383
00:30:42,802 --> 00:30:44,622
and this little tiny compromise

384
00:30:44,622 --> 00:30:45,882
across the landscape,

385
00:30:47,242 --> 00:30:48,702
consumers of Bitcoin content

386
00:30:48,702 --> 00:30:49,682
were left uninformed

387
00:30:49,682 --> 00:30:50,382
about alternatives.

388
00:30:50,882 --> 00:30:52,302
That's just a fact.

389
00:30:54,742 --> 00:30:56,282
Many listeners and viewers

390
00:30:56,282 --> 00:30:57,862
of these content creators

391
00:30:57,862 --> 00:31:01,062
directly bought cold cards based on a sponsored recommendation.

392
00:31:01,982 --> 00:31:03,322
And until last week, that was fine.

393
00:31:03,762 --> 00:31:04,502
Until it wasn't.

394
00:31:06,022 --> 00:31:09,382
And this is why Bitcoin, this week in Bitcoin, is value for value.

395
00:31:09,542 --> 00:31:15,922
I need you to understand how important it is that there isn't bias in a show like this.

396
00:31:16,462 --> 00:31:17,622
I mean, there can be bias, right?

397
00:31:19,042 --> 00:31:21,262
My stupid brain probably has biases.

398
00:31:21,262 --> 00:31:28,102
But my stupid brain is incentivized to self-correct to serve you in the value for value model.

399
00:31:28,422 --> 00:31:36,582
This isn't a pitch for the show, but I need you to understand how important your information diet is going to be if you want to hold on to your stack.

400
00:31:37,022 --> 00:31:38,502
You've got to wrap your head around this.

401
00:31:38,942 --> 00:31:42,442
It happens to be that it does directly benefit the narrative of the show.

402
00:31:42,442 --> 00:31:51,822
But the reason why it directly benefits my narrative of the show is because I've been doing this for over 20 years and 10 years ago and more than that, I had sponsorships go bad.

403
00:31:52,242 --> 00:31:59,142
I had GoDaddy sponsoring the Linux Action Show and they became a SOPA supporter, which was the most controversial thing on the Internet at the time.

404
00:32:00,082 --> 00:32:02,622
And I had a good deal go real bad quick.

405
00:32:03,842 --> 00:32:07,582
And I had to get rid of that sponsor and I had to take a massive financial loss.

406
00:32:08,362 --> 00:32:11,582
So, you know, I learned my lesson 10, 15 years ago.

407
00:32:12,442 --> 00:32:14,922
And I built this show on those lessons learned.

408
00:32:15,542 --> 00:32:19,542
A month ago, I was approached by CoinKite to do sponsorship on This Week in Bitcoin.

409
00:32:20,882 --> 00:32:22,722
Obviously, we did not go forward with that sponsorship.

410
00:32:23,142 --> 00:32:29,122
And I never mentioned it on air because, honestly, I figured at the time, you'd all think I was crazy.

411
00:32:29,642 --> 00:32:31,082
I mean, JB needs income badly.

412
00:32:31,162 --> 00:32:33,662
The other shows, they need sponsorships.

413
00:32:34,282 --> 00:32:36,882
And here's Twib, and it's getting offers, right?

414
00:32:38,782 --> 00:32:41,422
It's like, you know, it's the Apple, right?

415
00:32:41,422 --> 00:32:42,782
I'm being offered the Apple right there.

416
00:32:42,922 --> 00:32:44,542
And everyone loves Cold Card.

417
00:32:45,542 --> 00:32:49,582
So if I came on air and I told you I turned them down, you'd think I was crazy.

418
00:32:50,142 --> 00:32:53,502
If I told you that the show really can't go on unless you continue to support it, but

419
00:32:53,502 --> 00:32:57,582
Cold Card wanted to sponsor me, you would have thought I was crazy.

420
00:32:58,002 --> 00:32:59,722
And honestly, I didn't need to explain myself.

421
00:32:59,802 --> 00:33:00,362
I'm a big boy.

422
00:33:00,422 --> 00:33:01,822
I don't need to explain my decisions to you.

423
00:33:01,882 --> 00:33:02,882
I know what's best for the show.

424
00:33:03,662 --> 00:33:04,562
But here we are.

425
00:33:05,402 --> 00:33:06,122
Here we are.

426
00:33:06,202 --> 00:33:07,462
Just two weeks later, really.

427
00:33:08,682 --> 00:33:09,902
Conversation ended like two weeks ago.

428
00:33:09,902 --> 00:33:15,922
imagine if I had been chilling cold card for the last month or so imagine if I stopped talking

429
00:33:15,922 --> 00:33:19,202
about the other wallets kind of silently and just sort of gave preference to cold card

430
00:33:19,202 --> 00:33:21,842
that's just a hot mess none of us need

431
00:33:21,842 --> 00:33:32,162
I want to do the show for you not for a sponsor and you need to be able to trust my take even if

432
00:33:32,162 --> 00:33:35,462
I'm getting it wrong because I misunderstood something you need to know it's not because

433
00:33:35,462 --> 00:33:42,402
of some bias because I'm getting paid by a sponsor. And it just matters in the DNA of the show because

434
00:33:42,402 --> 00:33:49,442
of what we're talking about here. You've really got to wrap your head around this. Bitcoin is on

435
00:33:49,442 --> 00:33:54,462
the front lines of this thing. It sits on the shoulders of giant open source projects that are

436
00:33:54,462 --> 00:33:59,842
also on the front lines, constantly getting attacked by new AI tools. And like, who doesn't

437
00:33:59,842 --> 00:34:04,482
want to hack Bitcoin or any Bitcoin software? There's real money. You get real money right away.

438
00:34:04,482 --> 00:34:11,522
the incentive because it's it because it's a real money b generates massive headlines and c

439
00:34:11,522 --> 00:34:16,022
is a very interesting technical challenge with lots of open source software as just public

440
00:34:16,022 --> 00:34:22,942
reference and you combine it with these things like kimmy k3 you really have a powerful combination

441
00:34:22,942 --> 00:34:28,782
here we are on the front lines and it just matters so so much that we keep a clear head

442
00:34:28,782 --> 00:34:31,962
this cold card hack is the starting line.

443
00:34:32,562 --> 00:34:34,282
It's the starting line of this.

444
00:34:34,802 --> 00:34:38,002
And I want to finish just my line of thinking with this.

445
00:34:38,589 --> 00:34:43,349
BIP-110 has been a huge distraction.

446
00:34:43,869 --> 00:34:46,729
I warned about this a few weeks ago, and here we are.

447
00:34:47,369 --> 00:34:50,929
Every single prolonged bear market, we usually have Bitcoiners turn on themselves,

448
00:34:51,049 --> 00:34:53,209
but this has been an absolute slop show.

449
00:34:53,729 --> 00:34:57,749
BIP-110 debacle has been the lead character of the Bitcoin bear market,

450
00:34:57,849 --> 00:35:00,369
and we have completely ignored the fundamentals as a result.

451
00:35:00,909 --> 00:35:04,729
We have been completely distracted by baby brain thinking and vibes

452
00:35:04,729 --> 00:35:07,609
and not paying attention to the fundamental issues that matter.

453
00:35:08,089 --> 00:35:09,009
It's embarrassing.

454
00:35:09,349 --> 00:35:10,369
It's embarrassing.

455
00:35:10,609 --> 00:35:12,749
And the market is punishing us for it right now.

456
00:35:12,889 --> 00:35:13,669
It's embarrassing.

457
00:35:16,809 --> 00:35:19,449
BIP-110 has been an attack on the social layer of Bitcoin.

458
00:35:19,669 --> 00:35:22,349
And now we're all collectively being punished for it.

459
00:35:23,649 --> 00:35:28,709
It's just, it's such an embarrassment as we get close to the fork day.

460
00:35:28,909 --> 00:35:30,149
And it's all vibes.

461
00:35:30,409 --> 00:35:35,289
Yeah, this was a totally humbling event for, really, for the market.

462
00:35:35,289 --> 00:35:42,349
And like we were talking about a bit earlier, Matt, is everybody's been tested in this bear market and just tested in different ways.

463
00:35:42,589 --> 00:35:54,429
And, you know, like our volatility event and now the self-custody event, I wouldn't be surprised to see a little bit of cohesion here as every single person that's involved in the Bitcoin network is going to push that much harder now.

464
00:35:55,129 --> 00:35:55,249
Right.

465
00:35:55,549 --> 00:35:57,429
The security is going to get better.

466
00:35:57,869 --> 00:36:04,229
People are going to be testing and using these AI tools to test all of their platforms as much as possible.

467
00:36:04,229 --> 00:36:08,009
and that's going to be an ongoing task that people are doing. Corporations are going to be

468
00:36:08,009 --> 00:36:12,729
doing it. Corporations are going to be pushing their custodians to strengthen and harden the

469
00:36:12,729 --> 00:36:17,629
network. They're going to question, they're going to verify. And ultimately, I think this will be

470
00:36:17,629 --> 00:36:23,609
really strong for the Bitcoin network. A couple of crazy things that came to my mind. This event

471
00:36:23,609 --> 00:36:29,669
happened and the price of Bitcoin is trending up. This is the largest theft in Bitcoin history on

472
00:36:29,669 --> 00:36:34,829
sovereign cold storage wallets, yet the price of Bitcoin didn't really move. If this would have

473
00:36:34,829 --> 00:36:40,229
happened in 2017, the price of Bitcoin would have nuked, right? It would have nuked significantly.

474
00:36:40,909 --> 00:36:47,729
It would have been dropped to 50%, 60%. Yet here we are and the market is improving.

475
00:36:49,389 --> 00:36:54,849
Just a couple of other things that are mathematically interesting if you're thinking

476
00:36:54,849 --> 00:36:59,969
about risk, if you're a sovereign Bitcoin holder and you're holding Bitcoin in cold storage,

477
00:37:00,149 --> 00:37:04,449
the concept is be your own bank. I even have a sticker on my water bottle that says,

478
00:37:04,549 --> 00:37:10,409
be your own bank. And it's not for everybody. It is difficult. There are things you need to

479
00:37:10,409 --> 00:37:15,009
take into consideration. And I think that mathematical risk perspective is going to

480
00:37:15,009 --> 00:37:20,389
become a bit more apparent to everybody now that this event has occurred. It changes the risk

481
00:37:20,389 --> 00:37:26,569
calculus. It changes how you would think about managing your funds, whether that be single

482
00:37:26,569 --> 00:37:31,689
point of failure or multi-sig, multi-point of failure, and how you interface with that.

483
00:37:32,049 --> 00:37:37,829
If you are not interested in understanding what those are, there are now options to get Bitcoin

484
00:37:37,829 --> 00:37:41,369
exposure where you don't have to take those things into consideration. You can outsource that to

485
00:37:41,369 --> 00:37:45,549
other parties. That was one of the biggest developments in the entire Bitcoin ecosystem

486
00:37:45,549 --> 00:37:48,269
was the development of the Bitcoin ETF

487
00:37:48,269 --> 00:37:51,389
and companies that are holding Bitcoin on their balance sheet,

488
00:37:51,449 --> 00:37:53,129
taking leverage positions on the balance sheet.

489
00:37:53,289 --> 00:37:58,089
And that is all the evolution of the entire market here.

490
00:37:58,089 --> 00:38:02,769
The crazy reality is the ETF holders were better off.

491
00:38:03,709 --> 00:38:07,569
People that kept their Bitcoin on Coinbase better off.

492
00:38:08,889 --> 00:38:10,569
That's the painful reality.

493
00:38:11,549 --> 00:38:13,689
And what I witnessed, what I saw,

494
00:38:13,689 --> 00:38:17,989
was real Bitcoiners coming to the rescue and putting the work in.

495
00:38:18,109 --> 00:38:21,109
And what I saw on the BIP-110 side was vibes.

496
00:38:21,689 --> 00:38:25,309
I saw baby brain conspiracy theories just being cooked up.

497
00:38:26,009 --> 00:38:29,409
They're so self-focused that they think this cold card hack

498
00:38:29,409 --> 00:38:32,429
was some sort of, you know, nation-sponsored attack

499
00:38:32,429 --> 00:38:34,669
by big Bitcoin to delay BIP-110.

500
00:38:36,369 --> 00:38:38,029
It's absolutely wild.

501
00:38:38,689 --> 00:38:42,529
And it really was a stark contrast of real Bitcoiners getting to work

502
00:38:42,529 --> 00:38:45,169
and honestly some of the very technologies

503
00:38:45,169 --> 00:38:47,269
that BIP-110ers are against saving the day.

504
00:38:48,669 --> 00:38:51,249
And then you saw a lot of folks on the BIP-110 side

505
00:38:51,249 --> 00:38:53,089
just sitting around picking their nose,

506
00:38:53,509 --> 00:38:54,209
eating their boogers,

507
00:38:54,389 --> 00:38:56,409
and cooking up baby brain conspiracy theories.

508
00:38:56,769 --> 00:38:58,689
It was really a stark contrast.

509
00:38:59,429 --> 00:39:03,609
They are completely unaware of the bubble that they live in.

510
00:39:04,649 --> 00:39:06,169
This is really something.

511
00:39:06,169 --> 00:39:08,369
And here's my take from all of this,

512
00:39:09,069 --> 00:39:10,369
and hopefully your take.

513
00:39:12,529 --> 00:39:16,009
Trusting the vibes is what got us into this mess with Coldcard.

514
00:39:16,469 --> 00:39:17,749
We trusted the vibes.

515
00:39:18,209 --> 00:39:19,869
And BIP110 is all about vibes.

516
00:39:19,949 --> 00:39:20,949
It's all about being heroes.

517
00:39:21,489 --> 00:39:22,189
And I'm sick of it.

518
00:39:22,249 --> 00:39:23,289
I'm done with the vibes.

519
00:39:24,069 --> 00:39:26,009
Bitcoin is better than vibes.

520
00:39:26,309 --> 00:39:27,089
This is ridiculous.

521
00:39:28,269 --> 00:39:31,569
So I have a question for you, and I'd like you to go to boost.jupiterbroadcasting.com

522
00:39:31,569 --> 00:39:33,009
to support the show and answer this.

523
00:39:33,749 --> 00:39:37,849
When I look at this entire situation and I see the collective fault, we trusted we didn't

524
00:39:37,849 --> 00:39:38,229
verify.

525
00:39:38,229 --> 00:39:43,589
and my question is, is Bitcoin toxic maximalism dead?

526
00:39:43,769 --> 00:39:44,589
Has it failed us here?

527
00:39:45,769 --> 00:39:48,429
We focused on air gaps and powering cold cards

528
00:39:48,429 --> 00:39:50,449
with nine volt batteries and SD cards

529
00:39:50,449 --> 00:39:53,029
and we told ourselves collectively a lie

530
00:39:53,029 --> 00:39:54,129
to guess help us sleep at night.

531
00:39:54,209 --> 00:39:55,449
We all wanted to believe it was safer.

532
00:39:56,709 --> 00:39:58,129
And when I think about BIP-110,

533
00:39:58,269 --> 00:39:59,509
the temporary software created

534
00:39:59,509 --> 00:40:01,349
because a config option was changed,

535
00:40:01,409 --> 00:40:03,089
the default config option was changed

536
00:40:03,089 --> 00:40:05,489
that you could go back and change yourself in core.

537
00:40:05,489 --> 00:40:08,629
the response was BIP-110

538
00:40:08,629 --> 00:40:11,749
which fundamentally changes the rules

539
00:40:11,749 --> 00:40:16,309
and is now considering a proof of work change

540
00:40:16,309 --> 00:40:18,849
not so temporary I guess

541
00:40:18,849 --> 00:40:22,329
and they compare themselves to dropping a grenade at a wedding

542
00:40:22,329 --> 00:40:24,029
and then blame everyone else for it

543
00:40:24,029 --> 00:40:25,789
they still are doing it this week

544
00:40:25,789 --> 00:40:30,589
and all the Bitcoin loving plebs that fell for their good vibes slop

545
00:40:30,589 --> 00:40:33,929
they turned on some of the very OGs

546
00:40:33,929 --> 00:40:37,069
that created some of the fundamental stack Bitcoin relies on,

547
00:40:37,609 --> 00:40:39,909
some of whom were out there helping people this week

548
00:40:39,909 --> 00:40:41,029
while they were picking their nose.

549
00:40:42,649 --> 00:40:45,349
And they did it simply because their favorite YouTuber

550
00:40:45,349 --> 00:40:48,649
or ex-personality convinced them about the vibes.

551
00:40:48,709 --> 00:40:49,409
It's really something.

552
00:40:50,489 --> 00:40:53,569
And all of it, the cold card lack of verifying,

553
00:40:53,969 --> 00:40:55,109
the BIP 110 stuff,

554
00:40:55,369 --> 00:40:58,209
it's all the same lack of critical thinking

555
00:40:58,209 --> 00:41:00,549
and toxic behavior.

556
00:41:01,189 --> 00:41:02,389
So here's my question.

557
00:41:02,389 --> 00:41:05,049
as Bitcoin toxic maximalism,

558
00:41:05,329 --> 00:41:06,309
I can't even say it now,

559
00:41:06,569 --> 00:41:07,089
failed us.

560
00:41:07,469 --> 00:41:08,529
I never liked the term,

561
00:41:09,949 --> 00:41:12,389
but I used to think of it as an immune system

562
00:41:12,389 --> 00:41:13,469
that built up over time

563
00:41:13,469 --> 00:41:15,029
to fight affinity scams and FUD.

564
00:41:15,389 --> 00:41:16,629
But just look where it's left us.

565
00:41:17,609 --> 00:41:19,089
You would have been better with your keys

566
00:41:19,089 --> 00:41:20,849
in somebody else's wallet,

567
00:41:21,149 --> 00:41:22,609
on somebody else's exchange,

568
00:41:22,849 --> 00:41:23,429
with an IOU.

569
00:41:24,329 --> 00:41:25,629
And I hate to say that.

570
00:41:27,649 --> 00:41:29,569
But the moment that wallet was created

571
00:41:29,569 --> 00:41:30,369
five years ago,

572
00:41:30,649 --> 00:41:31,169
you were doomed.

573
00:41:32,389 --> 00:41:41,029
and so the bitcoin toxi maximum culture would have told us that you were a bad bitcoiner

574
00:41:41,029 --> 00:41:45,889
that you were at risk in reality they were putting you at risk

575
00:41:45,889 --> 00:41:52,109
and i was a cold card user i thought it was the best wallet possible now i wasn't exclusively a

576
00:41:52,109 --> 00:41:57,029
cold card user thankfully in fact none of the jb infrastructure uses cold card because i've

577
00:41:57,029 --> 00:41:58,729
always believed in diversified vendors.

578
00:41:59,249 --> 00:41:59,289
But

579
00:41:59,289 --> 00:42:05,069
this is where we're at now. And I'd like you to weigh in

580
00:42:05,069 --> 00:42:07,129
if you think that the Bitcoin culture

581
00:42:07,129 --> 00:42:09,069
has failed us here. And what do

582
00:42:09,069 --> 00:42:10,969
we do now? Do we be more open-minded

583
00:42:10,969 --> 00:42:12,269
about things like the ETF?

584
00:42:15,329 --> 00:42:17,189
Do we be more open-minded

585
00:42:17,189 --> 00:42:18,909
about things like devices

586
00:42:18,909 --> 00:42:21,109
that support other coins? Because those devices

587
00:42:21,109 --> 00:42:22,629
would have been a lot safer than a cold card.

588
00:42:25,069 --> 00:42:26,649
You know? We've always said, keep it simple.

589
00:42:27,029 --> 00:42:28,549
would have been a lot better.

590
00:42:29,729 --> 00:42:32,249
So, this is what I'm reflecting on.

591
00:42:32,969 --> 00:42:34,349
This is what I'm thinking about.

592
00:42:36,269 --> 00:42:38,749
The BIP-110 sheep are a brace-to-fork Bitcoin

593
00:42:38,749 --> 00:42:40,749
after a proof-of-work code change.

594
00:42:40,789 --> 00:42:41,389
It's just crazy.

595
00:42:42,589 --> 00:42:44,289
They're going to end up on a dead, worthless chain.

596
00:42:44,369 --> 00:42:45,929
They've been completely misled by vibes

597
00:42:45,929 --> 00:42:48,089
and Bitcoin-toxic maximalism.

598
00:42:49,069 --> 00:42:51,929
We were focused on 9-volt batteries and SD cards

599
00:42:51,929 --> 00:42:53,169
instead of random seed generators.

600
00:42:54,769 --> 00:42:56,569
I feel humbled by all of this,

601
00:42:56,569 --> 00:42:59,669
And it's made me rethink my risk profile when it comes to self-custody.

602
00:42:59,769 --> 00:43:02,889
So I'd like to know where your head's at, boost.jupiterbroadcasting.com.

603
00:43:03,349 --> 00:43:03,989
Let me know.

604
00:43:04,069 --> 00:43:05,189
Boost didn't support the show.

605
00:43:05,329 --> 00:43:06,409
And let's weigh in on this.

606
00:43:06,489 --> 00:43:07,989
And I'll continue to monitor the story.

607
00:43:08,109 --> 00:43:09,869
And I'll probably have more updates for you next week.

608
00:43:20,649 --> 00:43:25,650
Another story I was personally really disappointed to see is the start of this week we learned

609
00:43:25,650 --> 00:43:30,890
that Bolts, the amazing swap service between on-chain Bitcoin, Lightning, and Liquid, is

610
00:43:30,890 --> 00:43:36,630
shutting down indefinitely due to an underlying stack attack that seems to have been ongoing.

611
00:43:36,630 --> 00:43:41,810
And Bolts believes it's a major paradigm shift for Bitcoin services built on open source

612
00:43:41,810 --> 00:43:48,350
softwares warning users not to expect swap services to return anytime soon and the situation

613
00:43:48,350 --> 00:43:54,450
appears to be that bolts has been under constant ai attack ai assisted attack you know these tools

614
00:43:54,450 --> 00:43:59,730
get better and better and i guess there were some issues with their evm earlier a few weeks ago that

615
00:43:59,730 --> 00:44:04,310
they had to shut down some of their stablecoin support bitcoin news writes the service first

616
00:44:04,310 --> 00:44:07,910
went offline early on august 3rd without explanation several hours later the company

617
00:44:07,910 --> 00:44:12,410
confirmed the shutdown would continue, quote, until further notice as it reviews its security

618
00:44:12,410 --> 00:44:16,990
in response to the attacks. The company said that no user funds were lost during the attacks.

619
00:44:17,070 --> 00:44:20,790
Instead, Bolts itself covered the financial losses caused by the security incidents.

620
00:44:22,070 --> 00:44:26,530
So I read that to be that Bolts took a loss, maybe from their wallets. Now,

621
00:44:26,550 --> 00:44:28,610
they said it wasn't related to the cold card situation.

622
00:44:30,670 --> 00:44:35,110
They said that user funds were never at risk because Bitcoin never came under the company's

623
00:44:35,110 --> 00:44:41,310
control. They were not custodian the Bitcoin. They were non-custodial by design, but the losses were

624
00:44:41,310 --> 00:44:47,530
there alone. Bolt said some services will remain available. The refund API continues to work.

625
00:44:47,930 --> 00:44:54,290
The fallout from this really is going to be felt for the most part by Aqua users, Aqua Wallet,

626
00:44:54,690 --> 00:45:00,710
Bull Wallet users. The services and wallets and built-in swap services that I really like,

627
00:45:00,710 --> 00:45:06,830
I'm a big fan of all of this, but I was always a little hesitant about the Bolts as a central point of failure.

628
00:45:06,930 --> 00:45:09,750
I love, though, that they were non-custodial, so that reduced some of my concern.

629
00:45:10,010 --> 00:45:12,630
I was a big fan of Bolts.

630
00:45:13,450 --> 00:45:14,770
This is really sad to see.

631
00:45:15,230 --> 00:45:17,850
I think others will step up and fill the gap.

632
00:45:18,590 --> 00:45:25,090
Bull Wallet sounds like they're working on infrastructure and sounds like they are a Liquid Network Federation partner, so they can peg in and peg out directly.

633
00:45:26,890 --> 00:45:27,170
Whoo!

634
00:45:27,670 --> 00:45:28,730
That's a hit.

635
00:45:28,730 --> 00:45:32,190
And I think it again, it really, Bolt has it right.

636
00:45:32,250 --> 00:45:33,510
It is a major paradigm shift.

637
00:45:33,770 --> 00:45:39,670
We are watching a major paradigm shift and Bitcoin's going to be on the front line for this.

638
00:45:40,170 --> 00:45:41,470
But consider this as well.

639
00:45:42,370 --> 00:45:47,890
What just came for Bitcoin and what is still coming for Bitcoin will come for every bank, right?

640
00:45:48,470 --> 00:45:51,270
They're sharpening their teeth and they're learning with Bitcoin.

641
00:45:52,170 --> 00:45:55,630
And that's going to make them massive weapons.

642
00:45:55,630 --> 00:45:58,810
and they will then come for the banks

643
00:45:58,810 --> 00:46:00,570
and the banks will not be ready

644
00:46:00,570 --> 00:46:02,290
and they will not adapt as quickly.

645
00:46:03,130 --> 00:46:05,310
And Bitcoin will have spent this time in the fire,

646
00:46:05,790 --> 00:46:07,190
getting harder and smarter.

647
00:46:07,670 --> 00:46:10,250
That is the legitimate upside of all of this

648
00:46:10,250 --> 00:46:12,010
is by being on the front line,

649
00:46:12,090 --> 00:46:13,910
by being one of the first to get attacked

650
00:46:13,910 --> 00:46:16,610
and watching the response to this

651
00:46:16,610 --> 00:46:18,090
and the organization to this.

652
00:46:19,870 --> 00:46:24,170
I think we'll learn how fast Bitcoin can respond.

653
00:46:24,170 --> 00:46:37,150
And I think that's one of the things this incident is showing us, is how fast a decentralized community can respond. And we will be harder and sharper for this, and then it will come for everyone else. That, to me, is going to be absolutely wild.

654
00:46:54,170 --> 00:46:58,770
You can support the show just by doing what you do.

655
00:46:58,850 --> 00:47:01,630
If you're not a booster, you can buy Sats on River using our link.

656
00:47:01,710 --> 00:47:03,270
In fact, all these links are in the show notes.

657
00:47:03,850 --> 00:47:06,710
If you're all about self-custody and you're doubling down, the Bitcoin Well,

658
00:47:06,830 --> 00:47:09,050
they have been stepping up during all of this.

659
00:47:09,470 --> 00:47:12,590
And they'll also be looking at providing more swap services as well.

660
00:47:13,110 --> 00:47:16,330
And they are an amazing self-custody platform, the Bitcoin Well.

661
00:47:16,530 --> 00:47:22,790
Then there's the Bitcoin Company, a lightning-based service that you can go from Sats to gift card in just seconds.

662
00:47:22,790 --> 00:47:24,390
You can even log in using the Lightning Network.

663
00:47:24,790 --> 00:47:27,290
If you use my link in the notes, I get a few sats back for that.

664
00:47:27,890 --> 00:47:28,850
Then there's the fold card.

665
00:47:29,350 --> 00:47:32,470
You can just stack sats by paying for your daily living.

666
00:47:32,590 --> 00:47:33,050
That's what it is.

667
00:47:33,050 --> 00:47:36,370
It's like a debit card and a Visa system and an ACH to pay your bills.

668
00:47:36,970 --> 00:47:38,770
Salt Lending is great to get access to your liquidity.

669
00:47:38,970 --> 00:47:40,370
Strike has lots of services as well.

670
00:47:40,430 --> 00:47:41,450
I have links to all of those.

671
00:47:41,530 --> 00:47:44,370
No official relationship, but I use them and I recommend them.

672
00:47:44,690 --> 00:47:47,330
You can find links in the show notes or in your podcast app of choice.

673
00:47:52,790 --> 00:48:02,990
We do have some boosts to get to.

674
00:48:03,050 --> 00:48:05,130
Four score and seven boosts to go.

675
00:48:05,190 --> 00:48:08,570
And this is going to be across three shows, so...

676
00:48:08,570 --> 00:48:09,930
Stay a while and listen.

677
00:48:10,110 --> 00:48:11,790
I do think there's some good stuff in here.

678
00:48:11,850 --> 00:48:14,170
We're going to get into some of the recent topics.

679
00:48:14,170 --> 00:48:17,670
But Derivation Dingus kicks us off with a baller boost on discount,

680
00:48:18,070 --> 00:48:20,290
coming in with 30,600 sats.

681
00:48:20,370 --> 00:48:21,770
Hey, rich lobster!

682
00:48:22,790 --> 00:48:25,770
Hey, Chris, and thank you for the baller boost.

683
00:48:25,870 --> 00:48:28,150
I hope you're enjoying your time away from the podcast studio.

684
00:48:28,270 --> 00:48:30,970
I really enjoyed this episode and wouldn't mind more episodes like it.

685
00:48:31,030 --> 00:48:32,570
That was the before Satoshi episode.

686
00:48:32,830 --> 00:48:35,630
I did the stereotypical things you aren't supposed to do back in the day.

687
00:48:35,690 --> 00:48:38,470
I got swept up in the 2017 hype, bought a little Bitcoin.

688
00:48:39,130 --> 00:48:42,910
I felt I missed the boat, so I bought a bunch of crap coins, got wrecked, sold everything

689
00:48:42,910 --> 00:48:44,730
and swore I'd never touch any of that again.

690
00:48:45,310 --> 00:48:46,010
Bitcoin included.

691
00:48:46,450 --> 00:48:49,550
Later, though, I discovered Linux Unplugged and self-hosted where I eventually heard about

692
00:48:49,550 --> 00:48:50,610
the Bitcoin dad pod.

693
00:48:50,610 --> 00:48:52,470
and that's when I actually got the path

694
00:48:52,470 --> 00:48:53,410
of learning about Bitcoin.

695
00:48:53,930 --> 00:48:55,590
Also, if anyone is looking for something

696
00:48:55,590 --> 00:48:56,330
even more in-depth,

697
00:48:56,430 --> 00:48:59,430
I thought the Genesis book by Aaron Van Windrum

698
00:48:59,430 --> 00:49:01,510
was a decent read and quite thorough.

699
00:49:01,930 --> 00:49:02,690
Thank you, Derivation.

700
00:49:02,770 --> 00:49:04,450
I appreciate that recommendation too

701
00:49:04,450 --> 00:49:05,890
and it's nice to hear from you.

702
00:49:06,330 --> 00:49:07,010
Hope you're doing well

703
00:49:07,010 --> 00:49:08,930
and I did enjoy my time away from the studio.

704
00:49:09,390 --> 00:49:10,670
I'm glad I made it back when I did.

705
00:49:10,670 --> 00:49:12,690
If the cold card situation happened a week sooner,

706
00:49:12,950 --> 00:49:14,410
I would have been cooked, man.

707
00:49:15,150 --> 00:49:18,630
Nakamoto 6102 comes in with 26,000 Satoshis.

708
00:49:18,630 --> 00:49:20,670
I hoard that which your kind

709
00:49:20,670 --> 00:49:22,670
says thanks for the value and thanks

710
00:49:22,670 --> 00:49:24,410
for the update. Well, thank you for the value.

711
00:49:24,890 --> 00:49:26,150
Adversary 17 is here with

712
00:49:26,150 --> 00:49:28,450
24,576

713
00:49:28,450 --> 00:49:28,990
Satushers.

714
00:49:32,990 --> 00:49:34,650
I had ETH for all about a

715
00:49:34,650 --> 00:49:36,630
month before I learned to go down the straight and narrow

716
00:49:36,630 --> 00:49:38,710
path from Bitcoin DadPod. Sold my

717
00:49:38,710 --> 00:49:40,630
ETH and now I'm all in on sats. Thank you

718
00:49:40,630 --> 00:49:42,530
for the easily downloadable Plan B episodes.

719
00:49:42,850 --> 00:49:44,630
I'm touring them now and committing to

720
00:49:45,230 --> 00:49:46,750
seed them for a very long time so others

721
00:49:46,750 --> 00:49:48,370
will download them as well. Oh, that's great.

722
00:49:48,370 --> 00:49:53,590
adversaries uh if you find anything uh any nuggets let me know i appreciate the boost

723
00:49:53,590 --> 00:50:01,150
derivation dingus is here with a mcduck boost that's 22 2222 satoshis things are looking up

724
00:50:01,150 --> 00:50:05,870
for all the duck emergency pod boost thanks chris and i can't say i saw this one coming

725
00:50:05,870 --> 00:50:12,310
crazy clinkers i agree i wish i would have saw this one coming uh you know part of the problem

726
00:50:12,310 --> 00:50:16,890
was is people tested some of the code paths and people tested the hardware with lasers and all

727
00:50:16,890 --> 00:50:23,110
kinds of stuff. But that sort of on or off condition wasn't checked. They looked right

728
00:50:23,110 --> 00:50:29,210
around it. Such a shame. Thanks, Darivation. Appreciate you. Producer Jeff's here with a row

729
00:50:29,210 --> 00:50:33,750
of McDucks. This old duck still got it. I really enjoyed the history lesson and hearing some old

730
00:50:33,750 --> 00:50:37,250
plan B again. I remember when you launched the show, and even though I had heard of Bitcoin before,

731
00:50:37,370 --> 00:50:42,850
I never gave it any thought until plan B and other JB shows started discussing it. While plan B was

732
00:50:42,850 --> 00:50:46,430
running, I was more concerned about what my next meal would be rather than buying and saving for

733
00:50:46,430 --> 00:50:48,410
the future. I did attempt to mine on

734
00:50:48,410 --> 00:50:50,490
a GPU back then. I failed to grasp and gave up

735
00:50:50,490 --> 00:50:52,390
quickly. Thanks for you, though, these boosts and

736
00:50:52,390 --> 00:50:54,410
a lot of time to stabilize, I finally get to buy

737
00:50:54,410 --> 00:50:56,170
and mine. Yeah, PJ, I love it!

738
00:50:56,750 --> 00:50:58,530
Thank you, sir. Good to hear from

739
00:50:58,530 --> 00:51:00,470
you. OB is here

740
00:51:00,470 --> 00:51:02,450
with 21,000 Satoshis.

741
00:51:02,850 --> 00:51:03,070
Hmm.

742
00:51:03,070 --> 00:51:05,410
It's a long history of me. 21 gigawatts!

743
00:51:05,690 --> 00:51:07,130
Hmm. Cold card.

744
00:51:07,830 --> 00:51:09,330
Industry leader. Dot, dot, dot.

745
00:51:09,770 --> 00:51:10,030
Yeah.

746
00:51:11,170 --> 00:51:13,090
Yeah. Oh, adversaries

747
00:51:13,090 --> 00:51:15,050
is back. You didn't get included in the... Oh, man,

748
00:51:15,050 --> 00:51:15,670
That's too bad.

749
00:51:16,330 --> 00:51:17,290
That's a shame.

750
00:51:17,430 --> 00:51:18,770
Coming in hot with the booze.

751
00:51:18,850 --> 00:51:20,310
Adversaries has no message, just value.

752
00:51:20,370 --> 00:51:20,890
But thank you, sir.

753
00:51:21,010 --> 00:51:22,110
We should include that in your total.

754
00:51:22,230 --> 00:51:22,850
I appreciate that.

755
00:51:23,310 --> 00:51:25,410
MDS comes in with 10,000 sats.

756
00:51:25,650 --> 00:51:27,530
You're doing very well.

757
00:51:27,870 --> 00:51:28,850
Dive for value forever.

758
00:51:29,030 --> 00:51:29,870
Yeah, you get it, buddy.

759
00:51:29,950 --> 00:51:30,750
I hope you get it.

760
00:51:30,810 --> 00:51:31,570
Thank you very much.

761
00:51:31,910 --> 00:51:32,550
Appreciate you.

762
00:51:32,950 --> 00:51:34,170
Hey, there's Gene Bean.

763
00:51:38,990 --> 00:51:42,310
Gene Bean comes in with 16,006 Satoshis.

764
00:51:42,370 --> 00:51:43,010
Oh, my God.

765
00:51:43,070 --> 00:51:44,530
This drawer is filled with fruit loops.

766
00:51:44,530 --> 00:52:03,631
He says so early before podcasting 2 Here some story time though I got into Bitcoin because of you talking about on various shows and the broader podcasting 2 movement I did my toe in with lightning and boosting and I got more curious

767
00:52:04,071 --> 00:52:05,571
I listened to an audio book called Broken Money

768
00:52:05,571 --> 00:52:06,851
and I was a convert afterwards.

769
00:52:07,311 --> 00:52:08,791
I followed that with the Bitcoin standard

770
00:52:08,791 --> 00:52:09,671
and hidden repression,

771
00:52:10,011 --> 00:52:11,851
how the IMF and the World Bank sell exploitation

772
00:52:11,851 --> 00:52:12,511
as development.

773
00:52:12,951 --> 00:52:13,831
And I'll never turn back

774
00:52:13,831 --> 00:52:15,471
now that I've seen the money printer behind the curtain.

775
00:52:15,811 --> 00:52:16,611
Hard money is the way.

776
00:52:17,151 --> 00:52:19,191
Gene, that's so great.

777
00:52:19,271 --> 00:52:20,191
I love those books too.

778
00:52:20,851 --> 00:52:21,451
Follows up with,

779
00:52:21,451 --> 00:52:22,631
even though I had not used cold card,

780
00:52:22,631 --> 00:52:26,191
I agree. It's time to move from using single hardware wallet to a multi-sig vendor hardware

781
00:52:26,191 --> 00:52:29,811
wallet. Step out just out of an abundance of caution. Time to order that other wallet.

782
00:52:30,071 --> 00:52:36,351
I had my eye on. Yeah. You know, right now, these days, I'm looking at the Jade pretty fondly.

783
00:52:36,871 --> 00:52:43,031
The Jade wallet, I think the SeedSigner, those are kind of top of my list. And I think for a lot

784
00:52:43,031 --> 00:52:48,031
of folks, the BitKey should be a consideration as well. So sort of a long list, but I'd like to dive

785
00:52:48,031 --> 00:52:51,971
more into that and hear what people think as well. Landlocked came in with 5,000 sats.

786
00:52:51,971 --> 00:52:52,571
Make it so.

787
00:52:53,031 --> 00:52:54,991
Watch the last episode on YouTube, so here's some value.

788
00:52:55,071 --> 00:52:55,631
Keep up the work.

789
00:52:56,691 --> 00:52:57,431
Thank you, sir.

790
00:52:57,771 --> 00:52:58,131
Boost!

791
00:52:58,291 --> 00:52:59,711
Appreciate you actually doing that.

792
00:52:59,771 --> 00:53:01,511
Not many people will take the time to do that.

793
00:53:02,191 --> 00:53:05,051
Forty Deuce comes in with 4,200 sats.

794
00:53:05,391 --> 00:53:06,331
Everything's under control.

795
00:53:06,571 --> 00:53:07,051
Great track.

796
00:53:07,131 --> 00:53:07,891
Oh, he sent it to our artist.

797
00:53:08,031 --> 00:53:12,751
Another excellent site for value for value music I haven't heard you mention is lnbeats.com.

798
00:53:14,291 --> 00:53:17,751
Maintained by any links to the Noster profile.

799
00:53:17,971 --> 00:53:18,571
I forget.

800
00:53:18,771 --> 00:53:19,491
I know the person.

801
00:53:19,491 --> 00:53:24,271
They're known for music side projects, split kick, hero caster, very, very great, prolific developer in podcasting.

802
00:53:24,691 --> 00:53:26,411
Yeah, and I'll co-sign LN Beats.

803
00:53:26,811 --> 00:53:31,031
I like V for V music and Fountain FM as well and LN Beats.

804
00:53:31,671 --> 00:53:34,751
That's kind of my triangle of getting value for value music right there.

805
00:53:35,071 --> 00:53:36,451
That's the secret sauce, 40 Deuce.

806
00:53:36,511 --> 00:53:37,491
Thank you very much.

807
00:53:38,431 --> 00:53:42,611
The GWJW comes in with 3,333 Satoshis.

808
00:53:42,711 --> 00:53:43,991
Just pump the brakes right there.

809
00:53:44,171 --> 00:53:44,551
Cool tune.

810
00:53:44,771 --> 00:53:45,171
Cool summer.

811
00:53:45,351 --> 00:53:46,351
Thank you for supporting the artist.

812
00:53:46,971 --> 00:53:47,671
Appreciate it, the.

813
00:53:47,671 --> 00:53:53,631
bug-eyed stormtroopers here with 4,200 sats everything's under control my bitcoin journey

814
00:53:53,631 --> 00:53:57,911
began with linux unplugged to introduce me to podcasting 2.0 paradigm thanks wow that's great

815
00:53:57,911 --> 00:54:03,291
that's been i've got to hear a few of you said that that's awesome uh orange mart is here with

816
00:54:03,291 --> 00:54:12,851
5,000 sats big bitcoin boost yeah big bitcoin was right all along it turns out big bitcoin was

817
00:54:12,851 --> 00:54:19,731
right. Thank you, Orange Mart. Cronk the Donk Doggo comes in with 2,114 sats.

818
00:54:25,071 --> 00:54:28,751
Cronk the Donk, I don't know if I got that right. No messages value. I appreciate that

819
00:54:28,751 --> 00:54:34,091
very much. And then we got 5,555 satoshis from Ace Ackerman.

820
00:54:34,091 --> 00:54:42,791
Bitcoin found me in 2018, although I first heard about it when it was $1.

821
00:54:43,131 --> 00:54:47,051
And Andreas Andanopoulos' book on the Internet of Money was my intro.

822
00:54:47,231 --> 00:54:50,031
But American Kingpin by Nick Bolton really put me on the hook.

823
00:54:50,891 --> 00:54:56,471
I am a real estate investor, and I think that that shaped my view of Bitcoin as more of a store of value than money.

824
00:54:56,571 --> 00:54:57,751
Ah, that's nice, Ace.

825
00:54:58,391 --> 00:55:00,351
Also, great episode, and thank you for your courage.

826
00:55:00,511 --> 00:55:01,871
Rest in peace, John C. Dvorak.

827
00:55:02,311 --> 00:55:02,951
Yes, indeed.

828
00:55:04,091 --> 00:55:07,251
That's been a hard one to process as well.

829
00:55:08,791 --> 00:55:09,811
Thank you very much, Ace.

830
00:55:09,911 --> 00:55:10,591
Appreciate that.

831
00:55:10,931 --> 00:55:15,191
Kiwi Bitcoin guides here with 14,332 satoshis.

832
00:55:15,371 --> 00:55:16,211
Hey, hey, Ron.

833
00:55:16,511 --> 00:55:17,931
I didn't know that's what that button did.

834
00:55:18,231 --> 00:55:19,971
This is a tasty burger.

835
00:55:20,071 --> 00:55:23,171
Road trip booze from New Zealand at the BitWiki event on the weekend here.

836
00:55:23,231 --> 00:55:25,411
A few of us were swapping notes about podcasts.

837
00:55:25,611 --> 00:55:27,911
Twib came up as the one with the most signal.

838
00:55:27,911 --> 00:55:30,351
We have a saying here, world famous in New Zealand.

839
00:55:31,791 --> 00:55:32,811
Love it.

840
00:55:32,811 --> 00:55:34,711
Thanks for the update, Chris.

841
00:55:34,811 --> 00:55:35,411
Keep them coming.

842
00:55:35,511 --> 00:55:37,071
People afraid and a bit freaked out.

843
00:55:37,171 --> 00:55:40,691
So some calm words and solid advice from an OG like you were really helpful.

844
00:55:41,291 --> 00:55:43,271
Interesting spin on random numbers in LUP too.

845
00:55:43,351 --> 00:55:46,551
Seems like this is not the first time generating random numbers has led to problems.

846
00:55:47,051 --> 00:55:49,831
No, in fact, years ago, there was a massive Bitcoin wallet wipeout

847
00:55:49,831 --> 00:55:53,111
because of Android's random number generator not being sufficient enough.

848
00:55:53,691 --> 00:55:54,331
Thank you for the boost.

849
00:55:54,491 --> 00:55:55,151
Appreciate it, sir.

850
00:55:55,251 --> 00:55:56,151
Nice to hear from you, Kiwi.

851
00:55:56,751 --> 00:56:00,191
Magnolia Mayhams here with 2,320 Satoshis.

852
00:56:00,191 --> 00:56:03,151
Yes, zip code is a better deal.

853
00:56:03,231 --> 00:56:04,271
Oh, that's what that button does.

854
00:56:04,411 --> 00:56:05,051
I got new buttons.

855
00:56:05,691 --> 00:56:09,291
I was wondering where all my Stacker News sats were going.

856
00:56:09,391 --> 00:56:12,171
It turns out Fountain was linked as my primary wallet, not Albi.

857
00:56:12,611 --> 00:56:14,571
So enjoying some of my S-Post earnings.

858
00:56:15,971 --> 00:56:21,831
Also, I first learned about Bitcoin around 2011 from an article claiming that Bitcoin was the reason why GPUs were dying.

859
00:56:22,211 --> 00:56:23,051
Oh, that's fascinating.

860
00:56:23,151 --> 00:56:23,971
The FUD brought you in.

861
00:56:24,291 --> 00:56:27,351
For way too long, I was making people angry because I thought it was called Bitcoin.

862
00:56:28,411 --> 00:56:29,971
They thought I was calling it names.

863
00:56:29,971 --> 00:56:34,311
Oh, BitCon. I thought it was called Bitcoin. What a mess that last boost was. No, it came in fine.

864
00:56:36,911 --> 00:56:43,971
BitCon! BitCon! Moon Knight comes in and it is for 10,000 satushes.

865
00:56:44,671 --> 00:56:47,171
I hoard that which your kind covet.

866
00:56:47,451 --> 00:56:48,951
B-O-O-S-T!

867
00:56:49,171 --> 00:56:56,031
Oh, this is not the kind of 2 a.m. fire drill I needed. Thanks for the heads up. Moving my funds now. Good. Moon Knight. Man, I know, right?

868
00:56:56,031 --> 00:56:58,431
I had just made it home.

869
00:56:59,411 --> 00:57:02,551
Checked the news, saw it, and was like, oh, man.

870
00:57:02,831 --> 00:57:16,491
Started the process and then got in the car and drove to the studio and, like, got here, went through everything as fast as possible, checked mempool, see if everything was going okay, and then sat down and did the show.

871
00:57:16,571 --> 00:57:17,811
I mean, it was nuts.

872
00:57:18,731 --> 00:57:21,131
It was awful, actually.

873
00:57:21,611 --> 00:57:22,111
It was awful.

874
00:57:22,711 --> 00:57:24,691
Lee, Lee, Lee, Lee, Lee is here with 5,000 sats.

875
00:57:24,691 --> 00:57:26,071
The traders love the vol.

876
00:57:26,271 --> 00:57:27,131
Such sad news.

877
00:57:27,591 --> 00:57:32,071
Multi-vendor, multi-sig, and maybe even multi-institution calling OnRamp an anchor.

878
00:57:32,651 --> 00:57:37,551
This was a serious and worth spending time to resolve, unlike BIP110's general waste of everyone's time.

879
00:57:37,671 --> 00:57:38,311
Oh, man.

880
00:57:39,431 --> 00:57:40,271
Nailed it.

881
00:57:40,931 --> 00:57:41,511
Nailed it.

882
00:57:41,571 --> 00:57:42,731
I need to give you something for that.

883
00:57:42,791 --> 00:57:43,231
Here you go.

884
00:57:43,311 --> 00:57:43,771
Make it so.

885
00:57:43,971 --> 00:57:44,591
Nailed it.

886
00:57:44,711 --> 00:57:45,311
Oh, my God.

887
00:57:45,331 --> 00:57:45,911
You get a Picard.

888
00:57:46,071 --> 00:57:46,451
Thank you.

889
00:57:46,511 --> 00:57:47,971
I'm glad you and I are on the same page.

890
00:57:48,191 --> 00:57:54,671
That actually makes me feel a lot better because I feel like I've been going crazy in the sense that everybody else is going crazy and I'm sitting around having to watch.

891
00:57:54,691 --> 00:58:01,871
attention now stricts comes in with 10 000 sets oh yeah chris sending you some support support for

892
00:58:01,871 --> 00:58:04,691
taking the time to provide the emergency coverage staying on top of what's happening and keeping

893
00:58:04,691 --> 00:58:08,711
everyone informed thank you it was a hustle i appreciate you recognizing that thank you mal

894
00:58:08,711 --> 00:58:16,231
really do appreciate that hey chance of dizzy spells comes in with 19 291 satushes

895
00:58:16,231 --> 00:58:23,951
ah also recognizing the effort in the emergency pod thank you everyone for taking the time thank

896
00:58:23,951 --> 00:58:28,031
you for taking the time to warn us about all the exploits. Yet again, you're keeping me on my finger

897
00:58:28,031 --> 00:58:31,091
and my pulse of the events and news that really mattered. Thank you and bless you for the service.

898
00:58:31,791 --> 00:58:35,511
May the roads be clear and scenic. By the way, the boost value is not code, just the max

899
00:58:35,511 --> 00:58:42,791
palidromic value I could send you. Okay, right on. Why you got to put numbers and letters together?

900
00:58:43,091 --> 00:58:48,551
Why can't you just go? No, I really do appreciate it. Thank you very much. You're doing very well.

901
00:58:48,551 --> 00:58:52,931
All right. Sloppy Joe's here with 5,700 sats.

902
00:58:53,151 --> 00:58:54,191
Let's hear it, good buddy.

903
00:58:54,631 --> 00:59:01,111
Oh, BIPT110. As you know, fees have remained low. However, my primary concern is permanent data bloat.

904
00:59:01,271 --> 00:59:08,671
Prunable data burdens bandwidth temporarily, but UTXO bloat creates an unprunable prunable cost for every node and operator forever.

905
00:59:09,251 --> 00:59:12,851
Do you view unchecked UTX growth as a real threat to decentralization?

906
00:59:12,851 --> 00:59:17,831
if running a full node becomes prohibitively expensive does the network risk ever becoming

907
00:59:17,831 --> 00:59:23,011
a truly robust globally distributed network even if it's just enough to have a it's not just enough

908
00:59:23,011 --> 00:59:29,551
to have a lot of nodes in waiting i think he got cut off but i got i grok your point i do think out

909
00:59:29,551 --> 00:59:34,711
of all of the arguments about spam this is the most immediate short-term issue right like this

910
00:59:34,711 --> 00:59:43,211
is it. So I'm looking at the data. And right now, the current blockchain size is 865.4 gigabytes.

911
00:59:44,071 --> 00:59:50,011
And the Opratern data makes up about 5.89 gigabytes of that 865 gigabytes.

912
00:59:51,231 --> 00:59:55,691
So you'd still have 860 gigs without the Opratern data. Being generous here.

913
00:59:56,751 --> 01:00:04,251
So is this awful? I don't think so. And what I noticed this week is Opratern was being used by

914
01:00:04,251 --> 01:00:09,691
the victims of this attack. I don't know if it's going to be to any success, but they were trying

915
01:00:09,691 --> 01:00:14,851
to reach out to the attackers, sending them notes. We also saw things like Mars Sleepstream become

916
01:00:14,851 --> 01:00:22,331
useful for the plebs to save their multisig Mark III cold card setups. So I've been thinking about

917
01:00:22,331 --> 01:00:26,411
a lot of this, and it seems like the stuff that the BIP-110 folks have been warning us about,

918
01:00:26,491 --> 01:00:32,291
some of it just became very useful this week. And I'm kind of done with the vibes. I kind of

919
01:00:32,291 --> 01:00:48,092
want to go by data And to me 5 gigabytes to let people use Satoshi creation however they want and let the economic incentive system play out doesn seem like a high cost to pay Now if this was

920
01:00:48,092 --> 01:00:54,952
200 gigabytes, I'd be very alarmed. But under six gigabytes, it doesn't really alarm me. I hope that

921
01:00:54,952 --> 01:00:58,072
does that seem reasonable to you, Sloppy Joe? Let me know what you think about that. Great question,

922
01:00:58,072 --> 01:01:04,812
though i do appreciate it monty came in with a row of ducks that's 2 222 sats thanks for the two

923
01:01:04,812 --> 01:01:09,232
great episodes this history was well done and i learned a ton the cold card psa was also very

924
01:01:09,232 --> 01:01:12,632
informative can you recommend how we protect ourselves from attacks should all wallets have

925
01:01:12,632 --> 01:01:17,612
a password should we be creating new wallets and rolling our own entropy you know i don't want to

926
01:01:17,612 --> 01:01:21,192
have to recommend people have to start rolling dice i'm not opposed to it especially if you enjoy

927
01:01:21,192 --> 01:01:27,472
it um and it does give you some peace of mind but i i don't think that's what the uh i that cannot

928
01:01:27,472 --> 01:01:34,612
be the bar. That cannot be the bar for self-custody. I do think multi-vendor is smart because we're

929
01:01:34,612 --> 01:01:38,752
going to see more and more AI attacks. And I think one of the things perhaps to consider,

930
01:01:38,832 --> 01:01:43,352
I'm not saying this is a rule, but something to consider is maybe buy a wallet from a company

931
01:01:43,352 --> 01:01:48,072
that has a team of more than three or four people, that has serious researchers that are doing

932
01:01:48,072 --> 01:01:55,692
serious work. Block and BitKey come to mind. I mean, apparently Trezor and others. SeedSigner

933
01:01:55,692 --> 01:01:58,072
seems like they're holding up really well in all of this, doesn't it?

934
01:01:58,412 --> 01:02:00,512
Even though they were some of the most fudded by CoinKite.

935
01:02:01,032 --> 01:02:03,712
So I think multi-vendor, maybe multi-wallet,

936
01:02:04,072 --> 01:02:07,852
and I don't think anybody should not consider,

937
01:02:08,112 --> 01:02:09,472
I mean, there's other things like,

938
01:02:09,772 --> 01:02:11,412
in this case, River would have been a lot better.

939
01:02:12,192 --> 01:02:13,352
An ETF would have been a lot better.

940
01:02:13,712 --> 01:02:16,692
And I just think, I'm not saying that should be hard recommendations and advice,

941
01:02:16,832 --> 01:02:19,192
but as we work through this and we get on the other side of that,

942
01:02:19,292 --> 01:02:22,152
I think these are the things we should be humble about and ponder more.

943
01:02:23,132 --> 01:02:23,852
Thank you, Monty.

944
01:02:23,852 --> 01:02:25,892
And if you have any follow-up questions, please do follow up.

945
01:02:25,972 --> 01:02:27,252
I think that's a very important topic.

946
01:02:28,032 --> 01:02:29,112
Sleet Stats comes...

947
01:02:29,112 --> 01:02:29,952
I never get that right.

948
01:02:30,152 --> 01:02:36,292
Sleet Stack Stats comes in with one, one, one, one, one Satoshis.

949
01:02:36,512 --> 01:02:36,952
Hmm.

950
01:02:37,512 --> 01:02:38,192
Oh, my God.

951
01:02:38,252 --> 01:02:39,572
This drawer is filled with fruit loads.

952
01:02:39,612 --> 01:02:43,032
You know, 11,111 Satoshis feels like a message.

953
01:02:43,152 --> 01:02:44,812
Boy, they are doing a lot with mayo these days.

954
01:02:44,812 --> 01:02:46,112
Thanks for the emergency update, Chris.

955
01:02:46,172 --> 01:02:49,612
I'm going to share an unpopular opinion that there were two issues with this exploit.

956
01:02:49,612 --> 01:02:53,572
The first and most infuriating issue is the CoinKite entropy code.

957
01:02:53,852 --> 01:02:55,452
That's unexcusable and horrible.

958
01:02:55,912 --> 01:03:02,172
The second issue is hodlers choosing a niche security first hardware wallet and not rolling their own entropy and not using a strong passphrase.

959
01:03:02,372 --> 01:03:06,332
They would have been better off with a mainstream user friendly hardware wallet like Ledger or Trezor.

960
01:03:07,332 --> 01:03:07,812
Yeah.

961
01:03:08,312 --> 01:03:10,972
So let's talk about the passphrase thing because that was on the last boost too.

962
01:03:11,312 --> 01:03:14,752
I do think it is smart at this point to enter a passphrase.

963
01:03:14,872 --> 01:03:17,492
It's it is it does add complexity.

964
01:03:17,492 --> 01:03:21,632
and the only reason why I'm a little hesitant

965
01:03:21,632 --> 01:03:23,592
is on wallets like the Jade,

966
01:03:23,892 --> 01:03:25,312
it's a real pain in the ass.

967
01:03:26,152 --> 01:03:28,892
And if you get that wrong on the Jade,

968
01:03:29,312 --> 01:03:31,532
if you get your passphrase wrong on the Jade,

969
01:03:32,292 --> 01:03:34,872
it can be really disorienting

970
01:03:34,872 --> 01:03:36,572
because it opens up a new wallet.

971
01:03:36,772 --> 01:03:37,452
Now, this is a feature

972
01:03:37,452 --> 01:03:38,872
that allows you to have multiple wallets,

973
01:03:38,972 --> 01:03:41,012
but if you go in there

974
01:03:41,012 --> 01:03:42,532
and you get the passphrase wrong on this device,

975
01:03:42,592 --> 01:03:43,812
it's really hard to enter the passphrase.

976
01:03:44,112 --> 01:03:44,772
And then it goes in,

977
01:03:44,812 --> 01:03:45,752
you got a zero Bitcoin bounce,

978
01:03:45,792 --> 01:03:46,932
you freak out, right?

979
01:03:46,932 --> 01:03:48,992
and it turns out you just created a new wallet.

980
01:03:49,212 --> 01:03:50,172
Now, if you get the passphrase right,

981
01:03:50,232 --> 01:03:50,812
you'll get the right wallet.

982
01:03:50,892 --> 01:03:53,852
But any nuance, any difference in the capitalization,

983
01:03:54,032 --> 01:03:55,872
spacing, anything can be very confusing.

984
01:03:56,532 --> 01:03:58,612
So it is a little device dependent.

985
01:03:58,712 --> 01:03:59,512
That's what makes this tricky.

986
01:04:01,752 --> 01:04:03,252
And then I do think I agree with you.

987
01:04:03,292 --> 01:04:05,192
If you're going to buy a small niche hardware product,

988
01:04:05,332 --> 01:04:07,012
you better be responsible for your own entropy.

989
01:04:07,312 --> 01:04:09,212
Bring your own entropy, I suppose, as they say.

990
01:04:10,412 --> 01:04:11,832
Thanks, Leets. Appreciate that.

991
01:04:12,352 --> 01:04:14,272
I got a Fiat boost from Doma.

992
01:04:14,272 --> 01:04:15,672
Doma came in with $30.

993
01:04:16,252 --> 01:04:17,192
Well, I'll be dipped.

994
01:04:17,212 --> 01:04:17,592
All right.

995
01:04:17,992 --> 01:04:20,692
Enjoy every episode, but appreciate you doing the emergency episode for the community.

996
01:04:20,832 --> 01:04:21,252
God bless.

997
01:04:21,772 --> 01:04:22,252
Thank you, Doma.

998
01:04:22,412 --> 01:04:24,152
Appreciate you recognizing the value in that.

999
01:04:25,952 --> 01:04:27,492
Michael's of Binbo's.

1000
01:04:29,652 --> 01:04:30,052
Okay.

1001
01:04:30,792 --> 01:04:33,472
Microsoft Binbo's 98 comes in with $10.

1002
01:04:34,732 --> 01:04:35,332
Test boost.

1003
01:04:35,392 --> 01:04:36,772
I'm so glad I can send you fiat money.

1004
01:04:36,872 --> 01:04:39,552
I listened to all your podcasts, but I didn't want to set up Bitcoin right now.

1005
01:04:39,632 --> 01:04:40,252
Well, there you go.

1006
01:04:40,352 --> 01:04:40,852
Thank you, sir.

1007
01:04:41,232 --> 01:04:41,892
Appreciate it.

1008
01:04:42,012 --> 01:04:43,332
I liked your username too.

1009
01:04:43,332 --> 01:04:49,212
anonymous came in with a free member boost he's a good guy he's a real good guy no great guy i

1010
01:04:49,212 --> 01:04:55,692
assume so remember i just started four days off the grid when the news dropped oh my god scary to

1011
01:04:55,692 --> 01:04:59,112
think how i could have lost all my stash because i was away from my hardware wallet and couldn't

1012
01:04:59,112 --> 01:05:03,892
update my firmware in time my heart goes out to those affected do you think coin kite can ever be

1013
01:05:03,892 --> 01:05:08,092
trusted again no no and i think as more information comes out it'll be clear why

1014
01:05:08,092 --> 01:05:10,712
and I'm watching that information.

1015
01:05:11,252 --> 01:05:13,492
So I just dodged that bullet.

1016
01:05:13,652 --> 01:05:15,012
I was up in BC,

1017
01:05:16,612 --> 01:05:18,132
you know, 12 hours away from home,

1018
01:05:18,872 --> 01:05:19,912
12 hours through wildfires.

1019
01:05:21,672 --> 01:05:24,012
And if this had been just a few days earlier,

1020
01:05:24,052 --> 01:05:25,392
I just would have been absolutely sick.

1021
01:05:25,932 --> 01:05:27,352
I just made it back.

1022
01:05:27,712 --> 01:05:29,532
Just crazy, just absolutely crazy.

1023
01:05:29,532 --> 01:05:31,092
And it's made me rethink too.

1024
01:05:32,992 --> 01:05:34,372
That aspect, the physical,

1025
01:05:34,572 --> 01:05:35,852
having to be there physically aspect.

1026
01:05:35,852 --> 01:05:46,832
I actually thought my thinking had been the friction in spending and getting access to the Bitcoin was a positive in terms of, you know, not accessing my stack.

1027
01:05:47,132 --> 01:05:47,272
Right.

1028
01:05:49,772 --> 01:05:53,352
But then it turned out the real thing I needed to be worried about was actually being able to move it quick.

1029
01:05:54,092 --> 01:05:55,932
And who knows?

1030
01:05:55,972 --> 01:06:02,952
But that seems like that risk profile remains just as we enter this new era, at least of Sam Altman and Dario over there.

1031
01:06:03,012 --> 01:06:03,192
Right.

1032
01:06:03,352 --> 01:06:03,812
You know what I mean?

1033
01:06:04,472 --> 01:06:05,572
But I appreciate that.

1034
01:06:05,572 --> 01:06:07,352
Thank you, Anonymous, for the free member boost.

1035
01:06:07,472 --> 01:06:10,172
Remember, jupiter.party members get to boost the show for free.

1036
01:06:11,272 --> 01:06:11,812
All right.

1037
01:06:11,972 --> 01:06:17,092
That's everybody that was beloved the 2000sat cutoff.

1038
01:06:17,152 --> 01:06:17,972
I think that actually works.

1039
01:06:18,032 --> 01:06:21,032
I have to stop there for time, but I do read all of them and keep all of them in my show

1040
01:06:21,032 --> 01:06:22,692
doc for prosperity.

1041
01:06:22,872 --> 01:06:24,632
And thank you, everybody who streams sats.

1042
01:06:25,312 --> 01:06:27,812
30 of you did that, and collectively, it's a nice boost.

1043
01:06:27,912 --> 01:06:30,572
You stacked 86,518 satoshis.

1044
01:06:31,232 --> 01:06:32,912
You're doing very well.

1045
01:06:32,952 --> 01:06:33,732
Thank you, sat streamers.

1046
01:06:33,732 --> 01:06:43,512
When you combine that with our fiat boosts, our SAP boosts, and you take it at current market value, that means for the last three episodes, because this is across the last three episodes, we did pretty darn well.

1047
01:06:43,852 --> 01:06:49,192
The show stacked collectively 527,501 Satoshis.

1048
01:06:50,012 --> 01:06:50,752
Not bad.

1049
01:06:50,832 --> 01:06:52,852
That's kind of a cool number, if nothing else.

1050
01:06:52,892 --> 01:06:54,292
So I really do appreciate that.

1051
01:06:54,832 --> 01:06:59,692
And if you would like to support the show, you can do it in a couple different ways.

1052
01:06:59,692 --> 01:07:02,392
you can become a member with Fountain or jupiter.party,

1053
01:07:02,592 --> 01:07:04,492
and then you get access to the free member boost,

1054
01:07:04,852 --> 01:07:07,992
or just send a boost at boost.jupiterbroadcasting.com.

1055
01:07:08,072 --> 01:07:08,912
Support the show directly.

1056
01:07:09,392 --> 01:07:10,752
I think it's obvious why it's important

1057
01:07:10,752 --> 01:07:11,912
the show remained value for value.

1058
01:07:12,392 --> 01:07:13,632
I can't believe what a bullet.

1059
01:07:14,212 --> 01:07:14,892
I dodged.

1060
01:07:15,412 --> 01:07:16,092
I was tempted.

1061
01:07:16,552 --> 01:07:21,172
And I think if I hadn't been burned by sponsors in the past,

1062
01:07:21,432 --> 01:07:24,492
and to be completely clear and frank with you,

1063
01:07:25,072 --> 01:07:27,192
if I hadn't got the sniff and the smell

1064
01:07:27,192 --> 01:07:28,472
that me talking about other wallets

1065
01:07:28,472 --> 01:07:29,492
was going to be an issue for them,

1066
01:07:29,692 --> 01:07:31,312
it could have happened.

1067
01:07:31,632 --> 01:07:32,312
I don't know.

1068
01:07:32,732 --> 01:07:32,932
I don't,

1069
01:07:33,012 --> 01:07:34,192
maybe I would have eventually thought about,

1070
01:07:34,272 --> 01:07:34,952
I don't know.

1071
01:07:35,372 --> 01:07:37,412
But this has reinforced my belief

1072
01:07:37,412 --> 01:07:39,192
that this show either lives and dies

1073
01:07:39,192 --> 01:07:40,112
on value for value.

1074
01:07:40,472 --> 01:07:42,272
It's necessary for what we're talking about

1075
01:07:42,272 --> 01:07:43,492
so you can plan for yourself,

1076
01:07:43,912 --> 01:07:44,432
your family,

1077
01:07:44,612 --> 01:07:45,092
your business,

1078
01:07:45,172 --> 01:07:45,792
and your future.

1079
01:07:46,312 --> 01:07:48,572
And just trust that I'm doing the best job

1080
01:07:48,572 --> 01:07:49,672
I possibly can for you.

1081
01:07:50,392 --> 01:07:52,032
I'm not saying I will always get it right,

1082
01:07:52,172 --> 01:07:53,552
but I'm telling you I'm doing the best job

1083
01:07:53,552 --> 01:07:54,632
I possibly can for you.

1084
01:07:54,632 --> 01:07:56,652
And I hope,

1085
01:07:56,652 --> 01:08:00,692
I hope the last 117 or so episodes proves that.

1086
01:08:01,192 --> 01:08:02,432
And so you got to keep me going.

1087
01:08:02,692 --> 01:08:04,452
And I think, you know,

1088
01:08:04,472 --> 01:08:05,292
there are times like this

1089
01:08:05,292 --> 01:08:06,352
that show it's worth the investment.

1090
01:08:06,492 --> 01:08:07,012
So you got to go to

1091
01:08:07,012 --> 01:08:09,212
boost.jupiterbroadcasting.com to do that.

1092
01:08:09,432 --> 01:08:11,052
And thank you everybody who gets it.

1093
01:08:11,452 --> 01:08:12,432
A lot of you do.

1094
01:08:12,632 --> 01:08:14,572
And I'm very, very grateful.

1095
01:08:14,992 --> 01:08:16,192
But we still have more to get into.

1096
01:08:26,652 --> 01:08:27,972
This next one's real bad.

1097
01:08:28,712 --> 01:08:30,832
Your buddy Tom Lee has lost it.

1098
01:08:31,632 --> 01:08:32,312
Lost it.

1099
01:08:32,392 --> 01:08:33,872
He's got ETH goggles so bad.

1100
01:08:34,272 --> 01:08:41,132
He was on CNBC a couple of days after that Kramer clip that I played earlier about him selling all his coins because of the IBM CEO.

1101
01:08:41,792 --> 01:08:45,652
Poor old Tom, you know, his price calls just ain't working out.

1102
01:08:45,652 --> 01:08:53,932
And the guy's bitmine company is sitting on roughly $8.8 billion of unrealized losses on its ETH treasury.

1103
01:08:53,932 --> 01:08:59,032
and ETH is down about 45% from his average purchase price.

1104
01:09:00,032 --> 01:09:04,592
And it seems that might be impacting Tom's critical thinking engine.

1105
01:09:05,332 --> 01:09:13,072
But in July, Ethereum was up 25, outperformed the NASDAQ by 2,500 basis points.

1106
01:09:13,252 --> 01:09:15,772
That hasn't happened in more than a year.

1107
01:09:15,772 --> 01:09:17,112
And the last time it happened,

1108
01:09:17,153 --> 01:09:19,153
was the start of a big crypto up move.

1109
01:09:19,373 --> 01:09:22,993
So in a way, it's constructive that it was-

1110
01:09:22,993 --> 01:09:24,353
You're saying that on a month-on-month basis,

1111
01:09:24,553 --> 01:09:27,253
not because you could argue the NASDAQ

1112
01:09:27,253 --> 01:09:29,913
has outperformed Bitcoin, obviously, over the past-

1113
01:09:29,913 --> 01:09:31,613
Oh, yes, I'm talking about monthly return,

1114
01:09:31,773 --> 01:09:33,433
just like in the past month.

1115
01:09:33,433 --> 01:09:35,473
It says, yeah, that July-

1116
01:09:35,473 --> 01:09:38,193
Yeah, so it's an unusual break in pattern

1117
01:09:38,193 --> 01:09:40,373
because normally if the NASDAQ was down this month,

1118
01:09:40,413 --> 01:09:41,853
you'd expect crypto prices to be down.

1119
01:09:41,853 --> 01:09:44,753
Yeah, Katie Stockton said that last week

1120
01:09:44,753 --> 01:09:50,893
it was no longer, the correlation with the NASDAQ had broken down.

1121
01:09:51,233 --> 01:09:54,053
Jim Cramer spoke with Arvind Krishna last week,

1122
01:09:54,113 --> 01:09:57,533
and Arvind said that the way quantum computing is going,

1123
01:09:57,533 --> 01:10:00,973
that in three or four years, he'd be a little concerned

1124
01:10:00,973 --> 01:10:04,413
that quantum computers would be able to break the code

1125
01:10:04,413 --> 01:10:08,373
for any of these assets, you know, Bitcoin, Ethereum,

1126
01:10:08,373 --> 01:10:09,333
all the way down the line.

1127
01:10:09,413 --> 01:10:10,253
Do you worry about that?

1128
01:10:10,633 --> 01:10:12,033
Yeah, I mean, that's Q-Day.

1129
01:10:12,673 --> 01:10:14,313
You know, Q-Day, isn't that cute?

1130
01:10:14,753 --> 01:10:16,633
He calls it QDay. He gets real cute.

1131
01:10:16,793 --> 01:10:20,773
Notice his tone, if you're watching the video, his body language.

1132
01:10:22,213 --> 01:10:27,453
He knows that he's being a little cute here, and he's got a little brand name for it, QDay.

1133
01:10:27,833 --> 01:10:30,093
Ethereum all the way down the line. Do you worry about that?

1134
01:10:30,493 --> 01:10:31,873
Yeah, I mean, that's QDay.

1135
01:10:32,833 --> 01:10:37,993
Google researchers think QDay could be 2028 to break all encryption.

1136
01:10:37,993 --> 01:10:48,113
a lot of the crypto blockchains are developing quantum resistance so it's uh it's probably not

1137
01:10:48,113 --> 01:10:53,753
going to be a problem for ethereum or solana or canton no for bitcoin they haven't come to a

1138
01:10:53,753 --> 01:11:00,133
consensus on how to prevent q day will it be this is so this is so bad for tom this is so embarrassing

1139
01:11:00,133 --> 01:11:05,093
for him uh i mean you know he's being cute here you can tell he knows it uh but i'm not having

1140
01:11:05,093 --> 01:11:12,253
this. Of all weeks, I am not having this. We have witnessed an amazing, organic, decentralized

1141
01:11:12,253 --> 01:11:19,733
response to this cold card hack. You know, it has been incredible watching Rob Hamilton of Anchor

1142
01:11:19,733 --> 01:11:26,433
Watch and the Galaxy Digital Research folks step up. All the companies, really, I mean, that are,

1143
01:11:26,553 --> 01:11:32,613
you know, in sort of the well-known groups. It's been really interesting. And the amazing of organic,

1144
01:11:32,613 --> 01:11:37,073
decentralized response to this cold card hack is teaching us that when incentives align,

1145
01:11:37,153 --> 01:11:39,853
the Bitcoin community moves faster than you can believe.

1146
01:11:40,413 --> 01:11:42,413
Also, there's multiple research projects.

1147
01:11:43,273 --> 01:11:46,333
Blockstream's got a couple of really advanced ones to solve quantum.

1148
01:11:46,953 --> 01:11:50,973
And this idea that Ethereum, because it has central management, all of a sudden,

1149
01:11:51,313 --> 01:11:53,973
it's Ethereum's decentralized until it's not, right?

1150
01:11:54,033 --> 01:11:54,873
And now it's not.

1151
01:11:54,913 --> 01:11:56,693
And it's got central management and they're on it.

1152
01:11:56,733 --> 01:11:57,793
They're going to solve it, guys.

1153
01:11:57,853 --> 01:11:58,573
They got a proposal.

1154
01:11:59,113 --> 01:12:00,113
It's going to go great.

1155
01:12:00,593 --> 01:12:01,713
What a joke.

1156
01:12:02,613 --> 01:12:06,033
Ethereum has literally never shipped anything on time.

1157
01:12:06,613 --> 01:12:10,713
And the quantum risk for Ethereum is extremely higher than it is for Bitcoin.

1158
01:12:11,153 --> 01:12:13,453
With Bitcoin, your private keys could be at risk.

1159
01:12:13,713 --> 01:12:14,333
Well, guess what?

1160
01:12:14,913 --> 01:12:16,453
We're going through that right now.

1161
01:12:16,913 --> 01:12:21,913
The worst case scenario for Bitcoin with quantum is happening right now, and it wasn't even a quantum attack.

1162
01:12:22,553 --> 01:12:23,793
And the price is up.

1163
01:12:24,193 --> 01:12:25,593
The price is up.

1164
01:12:25,593 --> 01:12:33,093
Ethereum, Ethereum's core consensus system is vulnerable to quantum attack.

1165
01:12:33,753 --> 01:12:35,233
The consensus mechanism.

1166
01:12:36,753 --> 01:12:41,033
Ethereum's validators use BLS signatures to propose blocks and vote on a canonical chain.

1167
01:12:42,333 --> 01:12:45,013
BLS depends on elliptic curve cryptography.

1168
01:12:46,153 --> 01:12:51,093
And any quantum computer that would be sufficiently powerful enough to break Bitcoin keys,

1169
01:12:51,093 --> 01:12:53,053
or anything like that,

1170
01:12:53,733 --> 01:12:55,793
would also be sufficiently powerful enough

1171
01:12:55,793 --> 01:12:57,633
to break Shor's algorithm,

1172
01:12:57,893 --> 01:12:59,633
which Bitcoin doesn't use and Ethereum does,

1173
01:13:00,413 --> 01:13:02,693
which would mean they could crack Ethereum's consensus

1174
01:13:02,693 --> 01:13:05,593
and forge valid-looking votes and block proposals.

1175
01:13:06,133 --> 01:13:07,513
Think about the impact of that

1176
01:13:07,513 --> 01:13:09,553
on a proof-of-stake network.

1177
01:13:12,093 --> 01:13:16,413
The risk for Ethereum is exponentially bad.

1178
01:13:17,173 --> 01:13:19,333
The risk for Bitcoin is we go through

1179
01:13:19,333 --> 01:13:21,133
exactly what we're going through right now.

1180
01:13:21,633 --> 01:13:24,333
And the people that have to solve it for Bitcoin,

1181
01:13:25,053 --> 01:13:27,273
at the end user, the worst is probably going to be

1182
01:13:27,273 --> 01:13:29,053
you have to move yet again to another wallet.

1183
01:13:29,473 --> 01:13:31,513
You have to generate yet another wallet.

1184
01:13:31,853 --> 01:13:33,273
But you heard that clip.

1185
01:13:34,373 --> 01:13:36,773
You heard it's like finding an atom

1186
01:13:36,773 --> 01:13:38,093
across multiple galaxies.

1187
01:13:38,673 --> 01:13:40,093
We're a way off from that.

1188
01:13:40,933 --> 01:13:42,733
But that's going to be the worst case scenario.

1189
01:13:44,193 --> 01:13:46,993
And the theory, like, they have, well,

1190
01:13:47,013 --> 01:13:49,193
they've got a proposal to solve it over there at Ethereum.

1191
01:13:49,333 --> 01:13:50,173
so it's fine.

1192
01:13:51,213 --> 01:13:51,873
It's ridiculous.

1193
01:13:52,413 --> 01:13:53,813
The proof of stake merge

1194
01:13:53,813 --> 01:13:56,113
took seven years longer

1195
01:13:56,113 --> 01:13:58,793
than users expected.

1196
01:14:00,613 --> 01:14:02,353
And Ethereum's challenge here

1197
01:14:02,353 --> 01:14:03,333
is massive.

1198
01:14:03,713 --> 01:14:04,793
Replacing BLS

1199
01:14:04,793 --> 01:14:05,653
without losing

1200
01:14:05,653 --> 01:14:07,293
any kind of efficient

1201
01:14:07,293 --> 01:14:08,193
signature aggregation

1202
01:14:08,193 --> 01:14:09,333
is going to be nearly impossible.

1203
01:14:09,693 --> 01:14:10,673
And they already have

1204
01:14:10,673 --> 01:14:11,553
such high gas fees.

1205
01:14:13,753 --> 01:14:14,273
Currently,

1206
01:14:14,533 --> 01:14:15,993
as their theory lays it out,

1207
01:14:16,053 --> 01:14:17,173
as their proposal lays it out,

1208
01:14:17,233 --> 01:14:31,341
their post signatures are substantially larger and harder to aggregate and will centralize Ethereum substantially more That their current proposal that Tom all worked up about and they won even ship

1209
01:14:31,341 --> 01:14:31,841
it on time.

1210
01:14:32,881 --> 01:14:35,581
And the worst case for Bitcoiners is what we're going through right now.

1211
01:14:36,421 --> 01:14:37,701
So he knows what he's doing.

1212
01:14:38,161 --> 01:14:39,721
He has full on ETH brain now.

1213
01:14:39,801 --> 01:14:40,941
It's just so embarrassing.

1214
01:14:41,981 --> 01:14:42,721
All right, next story.

1215
01:14:42,801 --> 01:14:44,761
The clarity deadline has been missed.

1216
01:14:44,761 --> 01:14:46,721
I bet you probably noticed if you're paying attention.

1217
01:14:46,721 --> 01:14:52,701
but we did see some positive late additions for Bitcoin since my last coverage of it.

1218
01:14:53,241 --> 01:14:57,261
Recent Senate revisions added a full title focused on software developers

1219
01:14:57,261 --> 01:15:00,381
and non-custodial infrastructure providers.

1220
01:15:01,421 --> 01:15:06,421
The protections largely come from folding in the Bipartisan Blockchain Regulatory Clarity Act

1221
01:15:06,421 --> 01:15:08,461
in the Section 604 of Clarity.

1222
01:15:08,921 --> 01:15:10,941
And I boiled down the basic principle to this.

1223
01:15:12,201 --> 01:15:16,041
It's a protection for developers that says writing or operating software

1224
01:15:16,041 --> 01:15:19,681
is just not the same thing as being a financial intermediary.

1225
01:15:20,701 --> 01:15:21,641
This is huge.

1226
01:15:21,801 --> 01:15:23,401
You know, it's basically the money transmitter issue.

1227
01:15:23,641 --> 01:15:24,561
So that's big.

1228
01:15:24,621 --> 01:15:25,721
And that's under the current draft.

1229
01:15:25,841 --> 01:15:29,241
A developer or provider generally cannot be treated as a money transmitter

1230
01:15:29,241 --> 01:15:31,241
just because they wrote the software that enables it.

1231
01:15:32,561 --> 01:15:37,001
So to my eyes, that's like the entirety of the positive bits for Bitcoin.

1232
01:15:37,181 --> 01:15:38,321
But that is a positive thing.

1233
01:15:38,681 --> 01:15:43,081
The rest of the bill is supercharging KYC and anti-muttering laws,

1234
01:15:43,081 --> 01:15:48,501
really making crypto, you know, just as surveilled as the banks are.

1235
01:15:49,441 --> 01:15:52,801
But, you know, you might have noticed that we missed the August deadline.

1236
01:15:53,041 --> 01:15:55,361
So the question is, is Clarity dead?

1237
01:15:56,361 --> 01:16:03,081
Well, it may at least be really, really tough to pass at this point because it has, as I

1238
01:16:03,081 --> 01:16:06,001
warned, fully entered the realm of politics.

1239
01:16:06,001 --> 01:16:11,281
Now, the Democrats successfully stalled it debating over ethics and are now using it

1240
01:16:11,281 --> 01:16:15,681
as a voting issue, and they're even making ads around it.

1241
01:16:15,921 --> 01:16:20,121
How many Democrats have bowed to Donald Trump or sold out to corporate interests?

1242
01:16:20,401 --> 01:16:25,761
So you have a real choice. Angie Craig voted to let Trump make billions selling crypto coins.

1243
01:16:26,101 --> 01:16:31,281
I won't. She's with the insurance companies blocking Medicare for all. I'm fighting for it.

1244
01:16:31,281 --> 01:16:36,461
And Angie Craig was the only Democrat in this state to vote to let Trump unleash ICE.

1245
01:16:36,801 --> 01:16:40,341
I'll never cave to ICE or Donald Trump. I'm Peggy Flanagan.

1246
01:16:40,341 --> 01:16:45,221
I approve this message. Minnesota deserves a real fighter and a real Democrat.

1247
01:16:45,581 --> 01:16:54,281
The shame about that ad, right, is failing to pass the Clarity Act keeps the current laws in place that allowed Trump to make the profits he made.

1248
01:16:55,121 --> 01:17:02,841
And passing the Clarity Act would make it supposedly impossible, at least for Trump, to directly do that anymore in Trump-related members, I suppose.

1249
01:17:03,441 --> 01:17:11,761
So the irony that the Democrats are running on blocking clarity so that way Trump can't keep crypto scams going is really just pure, pure gaslighting.

1250
01:17:12,081 --> 01:17:13,301
It's really a shame to see it.

1251
01:17:13,721 --> 01:17:20,081
And, you know, the queen of crypto gaslighting is Liz Warren, and she has gone into full spin mode.

1252
01:17:21,401 --> 01:17:26,521
Liz knows that Trump made most of his money selling the crypto companies, not the crypto itself.

1253
01:17:27,261 --> 01:17:30,661
And she knows that he did that before he took office.

1254
01:17:30,661 --> 01:17:39,221
And she knows that the Clarity Act is entirely now almost a Democrat bill based on the amount of revisions and concessions that Lummis and her team made.

1255
01:17:39,441 --> 01:17:42,381
And it's loaded with new legal powers that never existed.

1256
01:17:42,481 --> 01:17:53,141
And that's why literally the intelligence agencies and every major law enforcement union in the United States has written letters in support of the Clarity Act because it gives them new capabilities and surveillance powers.

1257
01:17:53,401 --> 01:17:57,521
But even with all of that, she still makes this BS case.

1258
01:17:57,521 --> 01:18:06,401
because I see the clarity bill as insulting to the American people. Sometimes you get fooled.

1259
01:18:06,401 --> 01:18:12,681
Sometimes despite your best efforts, people get fooled. Sometimes Congress gets fooled. But boy,

1260
01:18:12,901 --> 01:18:21,061
not this time. Donald Trump has made clear what his scam is. Other scams are right out here where

1261
01:18:21,061 --> 01:18:27,641
we can see them, where criminals are able to step up their activity because crypto gives

1262
01:18:27,641 --> 01:18:32,681
them that special advantage to be able to get the money and hide who they are.

1263
01:18:33,001 --> 01:18:38,401
You know, it's also happening with terrorists being able to use crypto and the risk that

1264
01:18:38,401 --> 01:18:41,201
crypto poses to the entire financial system.

1265
01:18:41,321 --> 01:18:45,601
We've got the whole question about, in effect, shadow banking here and what that's going

1266
01:18:45,601 --> 01:18:45,821
to mean.

1267
01:18:46,321 --> 01:18:48,461
We know what the problems are.

1268
01:18:48,461 --> 01:18:54,061
We see a bill that's moving, and yet we don't fix it.

1269
01:18:55,141 --> 01:18:56,701
The Republicans like Loomis got played.

1270
01:18:57,361 --> 01:19:00,781
They made extensive changes to the Clarity Act.

1271
01:19:00,901 --> 01:19:06,661
They spent a year doing so after it was passed by the House, and it was all a play to just delay it.

1272
01:19:06,881 --> 01:19:11,821
And now they're just going with this line, even though they've got all the concessions they wanted.

1273
01:19:11,821 --> 01:19:20,941
And that's why perhaps the softest spoken senator I've ever known, maybe the nicest lady in D.C., has had it.

1274
01:19:21,161 --> 01:19:36,490
The ethics stuff around Trump seems to really grind her gears because she knows the kind of concessions that have been made Digital assets in a blind trust or divest himself of them entirely I still hear that not enough

1275
01:19:36,870 --> 01:19:42,090
I want to be very direct with this chamber because I'm done being careful about this.

1276
01:19:42,570 --> 01:19:52,010
I have spent my entire term working on this. I came here to simply ask what specifically is left

1277
01:19:52,010 --> 01:19:59,890
to give that's reasonable. Tell me the section number. My friends at some point continuing to

1278
01:19:59,890 --> 01:20:07,850
say not yet isn't cautious. It's a deliberate decision to run out the clock and kill a bill

1279
01:20:07,850 --> 01:20:15,750
rather than risk a no vote on the record with constituents and industry. I have more to say.

1280
01:20:16,090 --> 01:20:21,150
I'm going to say it. I'm going to say it before we get a vote on this bill. Just not today.

1281
01:20:21,470 --> 01:20:22,230
Well, just say it.

1282
01:20:22,290 --> 01:20:22,750
Why not?

1283
01:20:22,810 --> 01:20:23,430
Just say it.

1284
01:20:24,390 --> 01:20:28,330
Here's what I think could happen at this point is they have a tiny, tiny, tiny window in

1285
01:20:28,330 --> 01:20:28,730
September.

1286
01:20:29,210 --> 01:20:33,390
If they can do all of the procedural stuff now while some of the critters are on break,

1287
01:20:33,470 --> 01:20:36,310
there's still people there working and they can get a lot of the document stuff done and

1288
01:20:36,310 --> 01:20:38,910
there only has to be one small vote in September.

1289
01:20:39,150 --> 01:20:42,430
They have this tiny, tiny, tiny window where they can pass it.

1290
01:20:43,110 --> 01:20:46,290
Otherwise, I think the play becomes quite obvious.

1291
01:20:46,890 --> 01:20:52,130
The play here is that the Democrats make it a midterms campaign issue across the states as they need it.

1292
01:20:52,290 --> 01:20:55,030
It's just another arrow in their quiver, as they say.

1293
01:20:55,410 --> 01:20:56,750
They create the problem.

1294
01:20:57,790 --> 01:21:06,990
And then once they're in power, after a little bit of time, they pass their version of the Clarity Act, no doubt with new names and some more ways to go after the Trump administration.

1295
01:21:07,710 --> 01:21:11,370
And they pitch it as the solution to solve the crypto corruption that they ran on.

1296
01:21:11,370 --> 01:21:22,550
And the reason why I think this is likely is because the original version of this was created by the Democrats and Maxine Waters in participation with Sam Bankman-Fried at FTX.

1297
01:21:22,810 --> 01:21:34,150
The original regulation was created by the Democrats and was championed by the Democrats, which is why Lummis thought this was going to work.

1298
01:21:35,130 --> 01:21:36,890
But she forgot about the optics,

1299
01:21:37,650 --> 01:21:40,370
or at least she hoped the optics wouldn't win the day,

1300
01:21:40,450 --> 01:21:41,450
but they clearly have here.

1301
01:21:41,910 --> 01:21:43,450
And the Democrats now have themselves

1302
01:21:43,450 --> 01:21:45,710
a very handy thing they can run against.

1303
01:21:46,170 --> 01:21:48,690
Crypto and data centers are gonna be right up there

1304
01:21:48,690 --> 01:21:50,830
with all the other issues, and they got them.

1305
01:21:51,130 --> 01:21:54,150
And then they can come along and fix it later on,

1306
01:21:54,650 --> 01:21:55,510
after they're in power.

1307
01:21:56,010 --> 01:21:57,230
Seems like the solution to me.

1308
01:21:57,590 --> 01:22:00,030
If I were a politician, that'd be the play I'd be going for.

1309
01:22:04,150 --> 01:22:21,790
All right, let's wrap up with what may end up being a bit of irony and fate of history.

1310
01:22:22,050 --> 01:22:26,730
This cold card event might be looked back as the bottom of the bear market.

1311
01:22:27,190 --> 01:22:27,410
Maybe.

1312
01:22:27,410 --> 01:22:34,270
To be clear, not so convinced myself, but I guess such is the nature of bear markets.

1313
01:22:34,710 --> 01:22:39,630
But Arthur Hayes is, and Arthur Hayes is positioning to buy back into Bitcoin now.

1314
01:22:40,070 --> 01:22:44,110
He says it really depends on if we get any kind of deal with Iran at all.

1315
01:22:44,190 --> 01:22:48,510
By the way, this clip will have some mild language, so you may want to jump ahead 30 seconds.

1316
01:22:49,030 --> 01:22:52,570
But Arthur makes the case that the bottom is in.

1317
01:22:52,570 --> 01:23:01,210
firming up and so if we get sort of a um a dog shit seasire between the u.s and iran and things

1318
01:23:01,210 --> 01:23:05,330
slowly improve in terms of the amount of ships that go through the street and we don't progress

1319
01:23:05,330 --> 01:23:10,830
to an escalatory world war three and people just bombing each other um left right and center then

1320
01:23:10,830 --> 01:23:18,490
i think that on balance bitcoin probably bottomed at 60 000 and um myself and maelstrom will turn a

1321
01:23:18,490 --> 01:23:33,730
bit more constructive on risk going forward. All right, let's check in on the state of the

1322
01:23:33,730 --> 01:23:44,370
network. I am wrapping up at block height 961,198. The current Bitcoin price to US dollar is $64,830.

1323
01:23:44,370 --> 01:23:48,870
That puts our sats per dollar at 1,542 satoshis.

1324
01:23:48,990 --> 01:23:55,370
We're down from our all-time high at 48.6%, which was 303 days ago.

1325
01:23:56,670 --> 01:24:03,010
The next estimated difficulty change is an upward adjustment of 1.3% on August 8th.

1326
01:24:03,330 --> 01:24:06,130
We are up 2% in the seven-day.

1327
01:24:06,910 --> 01:24:07,310
Interesting.

1328
01:24:07,670 --> 01:24:08,990
Up 1.1 in the 24.

1329
01:24:09,890 --> 01:24:12,570
And, well, up 2% in the 30-day.

1330
01:24:12,890 --> 01:24:13,150
Huh.

1331
01:24:13,150 --> 01:24:14,950
I actually think that's pretty interesting.

1332
01:24:16,830 --> 01:24:18,170
All right.

1333
01:24:19,630 --> 01:24:22,830
And also, the fees are up.

1334
01:24:23,250 --> 01:24:24,150
The fees have been up.

1335
01:24:24,870 --> 01:24:28,150
Immediate right now is 4.6 sats per vbyte.

1336
01:24:28,390 --> 01:24:45,338
Half hour is 3 sats per vbyte So it is interesting to see the fee market responding to the increased on activity as both some lightning nodes are rebalancing which has also been happening this week quite a bit and as people move their funds to protect them But the network is delivering

1337
01:24:45,338 --> 01:24:46,278
and strong.

1338
01:24:46,278 --> 01:25:01,738
all right time for me to wrap it up i'd love you to go to thisweekinbitcoin.show and check out the

1339
01:25:01,738 --> 01:25:05,998
back catalog if you're new i'll also have links for all of the stuff i talked about and additional

1340
01:25:05,998 --> 01:25:11,698
things that didn't make it into the show that's thisweekinbitcoin.show and you can also go to

1341
01:25:11,698 --> 01:25:15,758
boost.jupiterbroadcasting.com and let me know how i did trying to create a show that doesn't get

1342
01:25:15,758 --> 01:25:19,418
distracted by the politics, but does analyze them and break them down for you so you can plan for

1343
01:25:19,418 --> 01:25:25,638
yourself, your friends, your family, your future, which seems to matter more than ever. So boost.jupiterbroadcasting.com

1344
01:25:25,638 --> 01:25:29,118
for that. And also, I'd love to know what else you'd like to hear from the show. If I miss something,

1345
01:25:29,598 --> 01:25:33,858
you're always welcome to suggest it. Now, I'm going to leave you with a value for value track.

1346
01:25:33,958 --> 01:25:38,518
So if you boost in while this track plays, 95% of the sats go to the artist. I don't know how much

1347
01:25:38,518 --> 01:25:43,018
longer I'll be doing this. This may be one of the last value for value tracks I play because I've had

1348
01:25:43,018 --> 01:25:47,818
some problems with this and I don't want to play tracks and I'll be able to credit the artist. So

1349
01:25:47,818 --> 01:25:51,278
this one should work great. I picked one that's been in the database for a long time.

1350
01:25:51,798 --> 01:25:56,738
It's an early winner in the Value for Value set. It's Empty Passenger Seat by Joe Martin.

1351
01:25:56,898 --> 01:25:59,958
And I'll see you back here next week. Thanks for joining me.

1352
01:26:13,018 --> 01:26:16,898
I know that they will someday.

1353
01:26:18,798 --> 01:26:22,078
Drinking all the backstage beer.

1354
01:26:22,678 --> 01:26:25,398
Trying to dry out your tears.

1355
01:26:25,918 --> 01:26:29,578
Man, it's been a long time since I've been home.

1356
01:26:29,678 --> 01:26:31,918
God, it feels like it leaves.

1357
01:26:32,858 --> 01:26:36,218
Mmm, forgive me for my confusion.

1358
01:26:36,778 --> 01:26:39,898
I got sold to rock and roll delusion.

1359
01:26:39,898 --> 01:26:42,598
Now it's taken its toll.

1360
01:26:43,018 --> 01:26:45,778
is catching up with me

1361
01:26:45,778 --> 01:26:49,018
got my foot to the floor

1362
01:26:49,018 --> 01:26:51,258
going nowhere fast

1363
01:26:51,258 --> 01:26:55,018
don't see how I can make this last

1364
01:26:55,018 --> 01:26:56,818
was convinced

1365
01:26:56,818 --> 01:27:00,418
that my life would be complete

1366
01:27:00,418 --> 01:27:04,278
beside an empty passenger seat

1367
01:27:04,278 --> 01:27:12,018
beside an empty passenger seat

1368
01:27:13,018 --> 01:27:16,838
Another service stop

1369
01:27:16,838 --> 01:27:20,678
Oh, another train to hop

1370
01:27:20,678 --> 01:27:23,618
Another corner street busker

1371
01:27:23,618 --> 01:27:26,438
Singing in the rain

1372
01:27:26,438 --> 01:27:31,178
Stringing my J45

1373
01:27:31,178 --> 01:27:35,618
Sticks and nerves make me feel alive

1374
01:27:35,618 --> 01:27:37,538
But I think of you

1375
01:27:37,538 --> 01:27:41,118
To try and keep me safe

1376
01:27:41,118 --> 01:27:46,338
Oh, forgive me for my confusion

1377
01:27:46,338 --> 01:27:50,038
I got a soul to rock and roll illusion

1378
01:27:50,038 --> 01:27:52,838
Now it's taking its toll

1379
01:27:52,838 --> 01:27:55,918
It's catching up with me

1380
01:27:55,918 --> 01:27:59,218
Got my phone to the floor

1381
01:27:59,218 --> 01:28:01,458
Going nowhere fast

1382
01:28:01,458 --> 01:28:05,218
Don't see how I can make this last

1383
01:28:05,218 --> 01:28:10,058
Was convinced that my life would be complete

1384
01:28:10,058 --> 01:28:15,058
This diamond empty passenger seat

1385
01:28:15,058 --> 01:28:22,058
This diamond empty passenger seat

1386
01:28:22,058 --> 01:28:45,458
I got sold to rock and roll delusion

1387
01:28:45,458 --> 01:28:48,278
Now it's taking its toll

1388
01:28:48,278 --> 01:28:51,098
And it's catching up with me

1389
01:28:51,098 --> 01:28:54,758
Got my phone to the phone

1390
01:28:54,758 --> 01:28:56,858
Don't know where to pass

1391
01:28:56,858 --> 01:29:00,778
Don't see what can make this last

1392
01:29:00,778 --> 01:29:02,358
Now I know

1393
01:29:02,358 --> 01:29:06,058
That my life won't become free

1394
01:29:06,058 --> 01:29:09,858
Beside an empty passage to see

1395
01:29:09,858 --> 01:29:17,858
Beside an empty passage to see

1396
01:29:17,858 --> 01:29:24,978
Beside an empty passenger seat

1397
01:29:24,978 --> 01:29:31,958
Beside an empty passenger seat