Paolo, Mathias, welcome to the Bitcoin Infinity Show.
Thank you very much for joining us.
Thank you for having us.
Yeah, good to have you here, guys.
We're going to talk a bit about Keet and Holepunch and a little
bit about Tether today, aren't we?
Sounds like that's the plan.
Yeah.
So thank you again, both for joining us.
And just to start things off, would you both mind giving a quick introduction
on, on yourselves just so our listeners have the background on you both?
Sure, I'm Paolo Arduino, I'm the CEO at Tether.
I started my career as a developer, over the last few years.
I pivoted towards more, strategy and execution for, Tether and Bitfinex.
And, co founded with Matthias, Holepunch, that is, building very, crazy and
awesome technology, that is gonna be disrupting the way people communicate.
Fantastic.
And, Mathias, over to you.
Yeah, thank you.
Yeah, I've been, so I come from a, a peer-to-peer background.
I've been working with peer-to-peer technology.
The last, I always say five, but it's probably more like 10 years.
'cause we all get older.
I did a lot of work on BitTorrent and I did a lot of work on JavaScript.
and a little bit came a little bit later to to, Bitcoin and I saw a lot
of potential on how we can use Bitcoin with pureology and like how we can use.
P2P technology to bring the same mission that Bitcoin has, but to,
to all kinds of data, setting up, setting all data free and, making
everything private per default and self sovereignty and that kind of thing.
I'm very into that.
and I've been lucky to work with, like I said, with Paolo for, many
years now and, Get a lot of, valuable, feedback and, idea sharing out of that.
And we're on a mission to, to, build some, really cool things.
In addition to all the things we've already been building.
So it's super exciting and glad to be here.
Oh, fantastic.
Matthias, that was a perfect segue into basically, an introduction to,
can you tell us about, Holepunch.
What is Holepunch and what are you doing?
Yeah, sure.
like I said, we co founded the company a couple of years ago.
Now, we've been building up a team of really talented peer to peer engineers.
we're always hiring also.
So if anybody's listening and want to join our mission, please, apply.
we have some really smart people working with us.
but we teamed up to basically.
like I said in my introduction, I've been working on peer to peer
technology for many years now and thinking ahead how we can, stop using
all that technology when I started it was only used for basically piracy.
I'm from the Nordics, and I think Knut is from the Nordics also, so he knows
all about, the Nordics know about piracy.
It wasn't back in the day.
A lot of very interesting technologies came out of that.
But basically, how can we use those ideas that were proven by piracy back then
to be really unstoppable, because a lot of people wanted to stop it, but apply
that same kind of mindset to the general data, so we can build actual applications
that has that kind of quality, that can withstand the wrath of God.
that can work without any centralization.
Actually, that's nobody can shut down, not even the authorities if they wanted to.
Basically unkillable and make that general enough that it can basically
run any kind of application, solve a lot of really hot problems.
it works on your own computers, your own networks.
Mobile phones, and tie that up.
I'm a developer by heart, into a software stack that people can just build on.
So not everybody has to go in and tackle all these problems individually,
but just give them some software to solve all this so they can, as
much as possible, just worry about making really cool applications
that we use, the kind of thing.
And, Yeah, like I said, we've been working really intensely on this, for
a long time and in Holepunch, we made this our co mission to scale this up
and, deliver a software stack on that.
and it's been really exciting and it's been really fun and it's been
very, challenging, but if it's not challenging, then why, do it?
and, especially, with the backing of, Tether, through Paolo and also just
expertise from there, we have a good hand built to deliver this to the world.
And, the first thing we did was, like, think about what's, a good first
application that we can build that can showcase this, but also something
we really want to use ourself and see scale have also have on the world.
And obviously that was a communications app, keyed,
which we was our first project.
And, we're still in beta and we're still lots of work to do.
And we're still iterating that really heavily, but I like to
show that you can build these kind of apps without any kind of.
central points.
and we released that also, like the first thing we released
when we launched the company.
And like I said, we're still, building and still iterating it.
A lot of fun.
and then take the software stack from that, which we call the pair
runtime and then split that out.
So anybody else can build similar apps on top.
With that same technology stack, and, yeah, that's, we launched that earlier
this year also, and, it's been really exciting so far, and it's, I love going
to work every day and solve, even though, you can see on my hair that it's not
really good for, the head scratching, but, but, it's really fun, and it's really
challenging, and it's interesting thing.
goal as a company, basically to have that if we go out of business tomorrow, our
technology continues to exist because we're not in the loop of anything.
It's also sometimes really hard to explain that we don't have any, chip coins
involved or any kind of limitations on the stack because we're basically engineering
it not to be part of it, because that's the only way you can actually engineer
these things that they can understand.
anything, and, yeah, that's, super exciting and, encourage
everybody to try to check it out.
we've, we've both used Keet and I've certainly enjoyed the experience.
I, think, the, basics of this, as I understand it, is that
it's, entirely on, on both sides.
The communicators end, or a group of communicators, it's all on their end,
and the communication is entirely peer to peer, as you say, and I guess
the main thing here is that, what is Keet really, okay, actually, I'll
back up a little bit here, what is the basics of Keet as, say, a product?
What is the easiest way that you would explain what it is?
But we're basically, the thing is actually really simple.
We're basically trying to just build a world class communications app that
works to a large degree, like normal communication apps that you know,
like Signal, Telegram, WhatsApp.
Just with all the centralization tucked away, with all the costs of
running it tucked away, and then adding all the features that also we
can, because we're peer to peer like.
It's in a file sharing.
I could limit some things when there's no limits because it's just
between people and stuff, but like to a large degree, just wrap that up.
Take all the technology.
People don't care about technology.
That's the shouldn't like we're, technologists.
We loved it, but don't have that surface off too much to the user.
Just have the user use it as any other app, but then just have it be
100 percent private per default, 100 percent like no strings attached.
It just works.
if we get caught off by a.
From the internet tomorrow, it will still work, that kind of thing,
but deliver that in a way, and this is always our mission where users
don't really need to worry about it.
It just works.
And, it works the same way to a large degree as their other apps work,
except obviously, there's no phone numbers and things like that, because
there's a lot of, issues with that.
Very cryptographically sound and, but trying always not to bubble it up.
And I think that's, so it's actually a really simple mission,
but it's obviously really hard.
And that requires a lot of smart people, but luckily our users in a good way,
don't need to be very smart about that.
So I think that's, the goal.
Yeah, a quick one there.
No strings attached starts with the letters Nostr,
so is, Keet and Nostr, do they go mix well together or, is there an
integration there between the two?
I see a lot of similarities here.
what's the story there?
the, I tried to explain the differences between Kit and Nostr.
I think Nostr is a very interesting protocol, but also is very, simple.
And, the way I like to describe it is that, if you remember, if you are familiar
with the history of filesharing, Starting from, from the first one, super, super
centralized, and then eventually every single step, from, even LimeWire, and then
you have Knutella, and you have all of them, you get to a decentralized platform.
And the last one, the most decentralized one, that is BitTorrent.
the story, the history of file sharing proved that every time
you try to centralize something, it ends up badly, right?
if you have any special node in the system that does a little bit more than
others and requires more resources than others to run, that will end up badly.
You might end up in a small room with a lamp in your room.
Point it to your face, and then everyone suddenly will stop running an indexer.
That reminds me about Nostr structure.
of course, I praise the efforts on the Open Source side and work, and so on.
That, of course, is great.
the reality is that if you are building a peer to peer system, or if you are
building a very resilient communication system, if you think about Nostr, you
would imagine that if you have, 10 million or 100 million users, the number
of relays would be probably less than the square root of the number of users.
So that surface, although a hundred million users is very,
they're not attackable, right?
But the surface of, of, the relays is much more attackable.
look at what happen, what will happen, what is happening with, also
the coin joinin platforms, right?
very similar.
If, if something, the beauty of KIT versus Nostr is that in KIT you
have number of relays is actually equal to the number of users because
the users are their own relays.
and they can relate, actually they can act as relays for others to increase,
to, further their connectivity.
That is how we think a technology that, has to be ready for the
apocalypse and resilient to the wrath of God should, work.
the, if you have, a log number of users or square root of number of users as relates,
I don't think it's cool technology.
It will work for, of course, better, will work better than centralized,
Technologies like WhatsApp and so on, or Twitter, but eventually will not
work if, when you will need it the most.
Because the point is that we will not know what will happen when we
will need this technology the most.
Today, not for everyone, but the world is still almost at peace.
Things might unfold, maybe in the future, and maybe sooner rather than later.
But when things will unfold, you will need the best of the best technology, the ones
that, the one that is truly independent, the one that is truly peer to peer.
it cannot, it's not really peer to peer if you have specialized relays,
because it's not peer to peer, but where you have super peers randomly.
Yeah, the difference here, between the Realize and not having any other
centralized infrastructure in the picture is certainly an interesting distinction.
We're definitely getting into a bit of the weeds, of this Keit architecture.
I hadn't heard anything about that you can act as a next
connector or something like that.
So there's a couple of related things.
I know there was an announcement about what, what, the, pair
runtime, is that right?
Is it, this is, can you talk a little bit about, about that or can any
other, the ways that this is, this is growing in your whole, platform,
Yeah, sure.
so basically when we talk about ideas, internally, also from our software
background, we never, We want to solve just like a single problem.
We want to solve a small problem that then can solve it for everybody.
So it's we're not set out in the world to build necessarily
communication technology.
We want to build technology that can just send data around efficiently, so
you can build any kind of app on top.
So really, we want We're all about modularity and all about, taking these
things to the extreme so we can repurpose it into any kind of application and
other people can, get value out of it.
And, that's been our mission from the get go.
So basically, like Paolo said, when we built Keed, Keed.
We took all of these primitives we have, it's all open source on our GitHub, that
can do various things, relay encrypted data in a way that's completely private,
nobody can read it, and in a generalizable way, so it can run on any applications.
We have databases that can interpret, work with this data on device, but still in a
way where nobody else knows what's going on, fully private, and we spent many years
perfecting this, and it's still ongoing.
so like huge project.
And we, similar to like connectivity, it might seem really easy if you don't know
what's going on that, connecting this computer to another computer and another
place, but it's really hard because ISPs and, your internet providers, et cetera,
they don't really want you to do that.
So there's a lot of firewalls involved that you have to work around to get
around back in the darn days when I was working with P2P, it was a lot easier.
It's only getting harder.
And we had to invest a lot in.
Making that work.
This is all really, hard problems that took a long time to solve.
But luckily, all of these are like generalizable problems where you just
solve them once to a large degree, and then it's solved for everybody.
If you put them in a modular framework where anybody can
put the Legos together on top.
And that's what we've been heavily invested in.
And then as we were building Keed, we realized that basically And Keete
is just like 95 percent of these Lego blocks that are applicable for anything.
So why not take all this stuff, pack it up for free, we don't make any money on it.
and an open source runtime that we're just giving away so other people can contribute
to it, but also build their own apps.
And, and, the more peer to peer apps the world has, the
better from my point of view.
and, and document it and make it really easy to install.
And I think actually Paolo said something interesting because as
soon as you have, one point of centralization, you can always unravel it.
and coming from the Bitcoin days, I remember how quickly things can unravel.
people went to jail for linking to things because authorities,
when they crack down, really hard.
so if you have one weak spot, it will be taken advantage
of at some point by somebody.
And so even things like distributing updates to your software can be really
hard because this often requires like a central point, like you go to a
website and you don't download it.
And so all apps built on our runtime, for example.
It's distributed through the runtime, which is a little bit mind bending.
So all apps are peer to peer data applications themselves, and the
network doesn't care, which means that we can continue to distribute updates
even, if everything gets shut down, you only need like a bootstrap for the
first install when you get the app.
That's a little bit easier problem to solve.
So we're thinking that in.
At every level, because it's really, important to us to, basically
learn from everything that happened in the past and then actually
build things that are resilient.
And we take this to a degree where I'm sure we could move 10 times faster
if we just let go a little bit of that idea, because it is easier to
just put all the data in one place or put all the updates in one place.
But then it's then we're just building the same old thing that's
going to die eventually anyway.
So we're very, uncompromising in that mission of actually decentralizing
everything from updates to, to, to data, and then also always
solving in a way where everybody can take advantage of that.
And then the final thing I'll say about that is that, so every time we update.
That runtime, those building blocks of that runtime, every time we
fix a bug, every time we make it faster, every app becomes faster.
That's also very exciting.
It's because you're building the whole infrastructure into this
layer that runs on your phone.
And it's all somewhat generalizable.
Every time we fix something, it's just better for the entire ecosystem.
And that's obviously really, exciting.
And like I said, actually, no strings attached.
Yeah, so I, I think you were referring to the trial of the Pirate Bay
people there in, In Sweden, right?
which
lucky enough to meet a couple of them in Denmark and it's been very
fun to hear about their journey and,
and there, there's, there was a great documentary made about it called TPBAFK.
So the Pirate Bay Away From Keyboard, about that whole trial and how,
corrupt the system was even back then.
And, throwing people in jail for providing links.
they didn't do any more wrong than Google did, from a certain perspective.
And, I remember even, before BitTorrents, there was a program called.
DC or Direct Connect Do you remember that?
I used to, it was one of my first introductions to decentralization.
Yeah.
it as you just shared your, like a Google Drive for everyone or something.
Like you just shared parts of your file tree to everyone who
wanted to peek into it, Yeah,
with
I find, I find it interesting what you said, because I think it's interesting
to think that I think to a large degree, the whole decentralization movement that
was happening with BitTorrent back in the day got shut down because At some
point, authorities figured out that they could just block DNS requests to shut it
down for normal people, and as soon as they did that, it was actually effective.
And to Paolo's point, one point of centralization, no matter
how weak it is, they're done.
and they tried to kill the technology elsewhere, but that's
actually what killed them.
Then, obviously, alternatives came that people could pay for, and it
also shows that people actually want, to stay on the right side of things.
I think, normally, now it's going very much in the wrong direction
again, because now we're back at abusing that centralization again.
the cycle will repeat.
But, yeah, like any point of weakness will be attacked at any point.
So what are the drawbacks to decentralization?
I think we and our audience certainly understand the benefit
of decentralization, what you gain by decentralizing, but what do
you naturally give up in terms of the user experience and the, ease
of, use, the convenience factor?
yeah, I'm sure Paola has stuff to say here, but I'm just, I love talking
about this stuff, so I'll go first.
Mattias.
I will pile
it's, I think it's a really interesting question, first of all,
because it's one of those questions where You know, obviously I want to
say there's no drawbacks, but like anything, it's a balance, right?
Because it's not that there's drawbacks and advantages, there obviously is, but
it's also just a different paradigm.
first of all, with sensitization, I think one of the biggest thing I noticed
also with developers is that we all come out of systems, education systems.
That teaches how to think centralized, which makes us biased
towards centralized solutions.
and that's, I remember my whole curriculum was about servers
and clients and stuff like that.
it's actually really hard to think about decentralization as a developer.
And I think that's actually part of why a lot of people think it's hard.
It's complex because it is complex, but also because we're just like, we've
been trained massively in the other direction, and it's really hard to go
back because decentralization can be as simple as what Knut said about DC
Connect, DC where it's just, oh, I'm just browsing other people's computers.
That's amazing.
That's a really, simple experience, and it's like something you can never do
But like in today's world, people, the first thing I always get asked
is like, how do I get a username?
And I'm like, that hasn't, usernames have an inherent centralization
and there's trade offs there.
And we need to think that through and stuff.
and most applications don't necessarily require usernames.
I'm not saying that's a bad feature, but it's that's where you need to think more
about the trade offs because there's governance involved to some degree.
But for the core experience, and I think that's what we've shown in Keith so far.
Like I said, we're still, There is actually very few trade offs you
need to do once you understand the technological changes you need to do.
Then, there's obviously tons of upsides also, it's much
easier to do big data transfers.
Money is less of a concern, which actually changes the thinking,
how you think about features.
And that, again, is something we've been trained in a lot as developers,
because we think centralized.
When we talk about features at Holepunch, hey, we should
add podcast recording to Keed.
Normally somebody would say, that's going to cost a lot of money to host that data.
And we just always we don't even have that discussion because it doesn't matter
because it's just between the users.
And then it's more about like the UX.
But then other simple, like I said, other simple discussions,
let's add a username index.
That's where we're like, okay, let's think that through because there's like
various things to think about there because there's no centric governance,
and we don't want to introduce that because again, one point is.
It's bad.
so it's, more like you really need to think differently and it's really hard
to wire your brain to think differently.
but once you get past that point, I think it's, super interesting.
And I, think actually developers care way more than normal people because,
developers care a lot about how links look and links and structure and that.
And normal people are just used to just clicking buttons and apps
and going with the flow on that.
And that's also what we're seeing, I think, with, a lot of key
I think the, when it comes to, definitely the hiring is, has proven a little bit
more challenging, as Matthias was saying, when you are told that the cloud is
your friend, That, hosting, on, Google Cloud or AWS is the right thing to do.
And, of course, it's get, it got cheaper and cheaper, so now
everyone can host their websites.
But the reality is that 70 percent of, the entire internet knowledge
is hosted by three, in the data centers of three companies.
developers should think about that, should think about the
fact that internet was born to be point to point and peer to peer.
And, we are very far away from that initial concept.
over the years, especially with the boom in, in the year 2000 for the
internet boom, and bubble, then,
realized that, holding people's data is the way to go, with
social media and social network.
That is even worse.
And so you have these friendly advertisements that are telling you,
That, with a smiley face that, you know, yeah, you should, upload all your
data on, Apple cloud or Google cloud.
And in general, cloud backups are great, right?
You want to have some sort of redundancy in your life, but the reality is that
you should be able to upload those.
In an encrypted way, and yet most of this data sits unencrypted because,
the big tech companies have to decrypt it and use it for, to milk the
information to pay for, for, another month of their new data centers.
the, issue is, we need, we have so much power in our hands through our phones.
the phones that we have today are much more powerful than the phones
that we, or even the computers that we have 10 years ago or 5 years ago.
And so We should, we are at a stage where we can use this, this, this, we
can use this hardware, not only for communicating, but also for in the future
for AI processing and inference and so on.
is, we need to, understand that the word cannot be connected to Google.
I mean if, we cannot found, we cannot be a function of Google.
We cannot be a function of AWS.
And so I think that, the, there is, escalating pace of, towards centralization
and it's almost a black hole.
And eventually, the, we'll attract all the lights and if we are too close to
it, no lights will come out anymore.
And, that's why we want to really to double down on this technology, because
it's not going to be easy, right?
It's going to be very challenging, and most of the people don't
care, as Maite has said before.
Most of the people will think, oh, it's Why do I care?
everything works with WhatsApp and, and, Signal, but Signal announced
that their 2023 costs for data centers and data center costs are around 50
million, and they, apart from the mobile coin that was not The best
thing that they could do, there is, it's not easy for them to monetize.
And the problem is that if you are, you're basically almost the only way to monetize
it is to sell your customer's data.
So if you don't want to sell your customer data, eventually your
service will not be sustainable.
So the only way to make it sustainable is actually going back to peer, where
you can leverage people, infrastructure, people, connectivity, people, phones,
people, processing power, Deliver very high quality communication system.
And while people don't care, people, people don't care until they care.
And when they will care, it will be probably usually too
late if nothing exists yet.
when people will care is because shit is hitting the fan.
And, you really want to have a solution that is not, that will survive if,
the countries around you or around the country where you live are not
going to be nice to your own country.
So that's the view to peer-to-peer.
The peer-to-peer wheel system will keep working if your neighbor countries
are not going to be nice towards you.
That's independence, that's resiliency, those are terms that, we need to
take very seriously, especially seeing where the, world is going to.
Yeah, I think we're all primed for, to, have a, what's the word, proclivity
for, centralization, centralized solutions, from a very young age.
this is the state, this is what it is like, state funded schooling.
state funders or state subsidized media.
We are, like brainwashed into, trusting, institutions all, like all our lives.
So I think that is somewhat connected to why people so reluctant to be
vigilant about this on the internet.
I think the two go hand in hand that we, take the comfortable way, or most people
take the comfortable route of, not taking responsibility for their own stuff.
not only on the internet, but outsourcing responsibility to the
government is basically the, another side of the same coin, right?
also find, I think also in that note, I think I find it very interesting,
especially being from a small country like Denmark that doesn't have a
lot of homegrown infrastructure.
And I'm just seeing how much communication with some of the public entities is
happening through centralized platforms like Facebook and things like that, where
okay, so But even though we centralize it, we also centralize it in companies
that we don't even have any control over in different countries where we probably
have, let's face it, no rights at all.
So it's it's like hyper centralization, especially from the weakest point of view.
And I think that's super problematic.
And I'm always.
Thinking it's, weird that we're not talking about that more in especially
like from, when you look at the things that they're trying to do in the EU,
they're almost trying to just push more and more in that direction,
which I find even more interesting.
yeah, definitely.
It's like a, it's, a huge problem and it's only getting bigger.
And that's, why
So to what level can decentralization actually get there?
What is the limit to decentralization?
And I'll calibrate this with an example.
The internet itself, you said it was built to essentially originally be
decentralized, but we don't have it.
For physical links, like individual physical links between each other,
the fiber or whatever the wire is goes together into another group of
wires, which eventually go into some backbone, which is operated by a company.
And then that goes into the global Internet.
And so somewhere it centralizes into telecom companies and other services.
It might be decentralized on one level, but there is a layer of centralized
services that make the internet work that isn't necessarily the so called
cloud providers and that sort of thing.
So is there a limitation to how far this can go?
I think the, in general, sure, there is, there are the ISPs and, their physical
infrastructure is in part centralized, but also you start having redundancy, right?
So for example, the backbones are redundant.
There are multiple companies running, cross connects across
different areas of the world.
Now you have Starlink if you want.
So you start getting, and by the way, that is a way, great way to start
decentralizing connectivity because Starlink will not be the only one that
will run satellites, so there will be multiple companies that will allow
you to connect through satellites, plus you have normal cabling.
So you will have, it will become a huge mesh network, it's already
in part, but it will become more and more a huge mesh network.
of course, if someone will cut the wires around your house and will beam
the, will use a beamer to kill your wireless, it's going to be a problem.
in general, you will always find a way, even with a pigeon, to start
sending bits out of your house.
I think the most important part is, you have to be in control of your
own data, and then, you need to send this data with the shortest path to
the people that you want to talk to.
Right now, I usually make this example, because I think it's When we do this
presentation, we try to make people think about how much waste also
centralized systems have created.
imagine you live in Rome, you have, you live in Rome and you have your family.
Most of people live nearby their families.
That is a classic thing among humans.
90 percent of the people live nearby their families.
Maybe nearby, like 10km, 50km nearby.
If you talk to your family, every single message, every single photo
that you will send to your family, that message will travel, instead of going
50 kilometers in a nearby town where your mother lives or your father lives,
it will travel every single message, every single bit of every single video
call or every single bit of every photo will travel 5, 000 miles to Frankfurt
just to go back 50 kilometers from you.
Imagine how much government spent in order to create these internet lines
and to empower them to make it bigger, more, with more capacity when the
majority of the people are talking to people and they're in the same area.
Peer to peer make things with, allows with a lower latency, allows to
save on bandwidth, allows to save on cost of global infrastructure.
So that's how, actually, We can create better mesh networks, more
resilient mesh networks, just because data will always find the shortest
path from one point to another.
And still all roads lead to Rome.
So
I'm Italian, so I need to use Rome as an example.
Yeah.
That's all good.
I find it.
I find also, I think the discussion here is really interesting also compared
to Bitcoin, because I also think it's actually the scaling longer term.
It's, a lot, large thing about.
Sovereignty, I think, like how, Bitcoin kind of told us very direct terms that if
you have a key pair, you have your money.
And it doesn't matter where you are in the world.
If you have that key pair, you have a way to, to get to that money.
And the means of transportation, it's actually very uninteresting in that
sense, because you have it with you.
The Internet today, the centralized Internet is designed in a way where,
what does it mean to go to Facebook?
it's really hard to explain because it's like some certificate that issued by
somebody, and we don't really, there's.
Some, cabal of companies that manages them, there's some regulations around
it, but we don't really actually understand it that well as normal people.
Technically, we can understand it, but it's very, centralized and it's very,
opaque and it's very built into the infrastructure in that way, in a bad way.
And, with Pure Technology, we're like taking the same approach as Bitcoin
here and saying, You're just a key pair, and the other person is just a key
pair, and there's a bunch of protocols around that, but the transportation
is actually not that interesting.
Right now, we use the internet to do it.
We'll probably do that for a long time, but there's no reason why we
can take the same technology we have right now and in 50 years run it on,
laser beams or something else, because we're taking the software and feedback.
I think, actually, that's the main thing to think about in that.
Discussion.
when, Paolo, when you were talking about that people don't care, when you were
saying that people don't care because WhatsApp just works, I was at the
same time thinking that's the parallel of people saying that, that, I don't
care because Visa just works, right?
And so the parallel between Bitcoin and what you're doing at Holepunch, Keet,
everything else here, really seems to be tracking along the same line.
And I guess there's the connection that, I don't, I won't say all, but
a lot of the people involved are already in the Bitcoin ecosystem.
But can you comment on is there a little more of a connection there between,
between Holepunch and Keet and Bitcoin?
Yeah, Bitcoin definitely is working and servicing, I think, in a good
way, many, people in communities.
The users of Bitcoin today are, unfortunately, and also that relates to
Tether, Still, mostly, I think in the Western world, in the richer countries,
as a way to save wealth and, as a store of value, more than a means of exchange.
For different reasons, right?
We'd like a network that would improve, of course, over time, and
there will be different approaches, but, still, the world is not yet
using Bitcoin, but the world will use Bitcoin when shit will hit the fan.
but the beauty of Bitcoin is that an option is already there, is available,
and when something bad will happen, people immediately, with a snap
of a finger, will turn to Bitcoin, and will have it and can use it.
don't have that in communications.
What is our communica our parallel with communications, if we don't have it?
I don't know, because if, if suddenly centralized communications will, be
blocked, or privacy in communications will be blocked, and you cannot, you
cannot use Whatsapp, or Whatsapp has to start giving all the information
to every single government.
and the government will become more evil than what they are today,
also western governments then.
we wanted to build the exact parallel as we said it, we just tried to describe it,
that with Bitcoin, for communications.
We need to have something that, Kit will take time to, since there
are so many alternatives that are working as with your, you can make
the parallel with Visa, right?
Visa is working today, so people are still using a lot of Visa, but
if something will happen, they will use Bitcoin from one day to another.
Whatsapp is working, and Zoom is working, and Google Meet is working, so
people don't feel the urge, but there will be a trigger point when people
will feel the urge at some point in their lives, because something happened
around them, and we need to make sure that kit will be available to them.
and will be an option, will be stable, will be well designed so that when
they will need it the most that option will be available to them.
Yeah, fantastic.
And so I think the follow up I have, and just to get back to the earlier
discussion a little bit with Nostr, the communication in terms of messaging, I
absolutely see that and directly in what Keet is, I already absolutely see that.
Is there a goal to get somewhere towards more like Social media, social networking,
things like that in a, in certainly a decentralized way, but right now
there, there isn't something like that as I understand it, coming from, Keet.
So is, that a goal?
Is that on the roadmap?
Yeah, it is on the roadmap, it's something that, so we had to start with the
thing that we thought was more urgent and also the thing that could have
been, would have been a game changer.
again, sure, social media is very important, especially in, in, in,
In difficult situation, you want to make, you want to get news, and you
want to get unbiased news, so you want to use, social networks to, to
see what's happening in the world.
But we, think that the most sacrosanct thing that you need in your life is
to be able to talk to your family and friends in any situation with
the highest privacy possible.
that's the first thing that we tackled, and also was a way to battle test the
technology with, with, Keet you can do high quality video calls as well, so if
we are able to tackle in the best way possible privacy and extreme scalability
of peer to peer communications, then on top of that foundation we can build
also social media and every single other application that we have in mind.
But first, we wanted to tackle the hardest problem.
I'm not sure, Matthias, if you want to add on.
No, I think it makes a lot of sense.
And I also just want to say, as a, probably like one of the
most prolific Keet users, I use Keet right now also as a very,
like a social media, we have big public rooms where we talk about
Keet and talk about technology.
I get a lot of the value I would get otherwise on Twitter X from that
because I, it's like a public platform for me to, get ideas out there, but
also interact with users directly.
And I think, there's many ways to take them as a young app.
And we're talking about this a lot, obviously it has to be
simple, has to be parent approved.
My parents can figure it out, but I think, to a large degree, all really
healthy social networks that are actually, to some degree, a communication app.
And it's also just a really good way to get local news and to get
this locality that Peter is good at.
That doesn't mean that we might not also make other things, but I think it's a
hard line to set the difference between a social network and a communications app
when it's structured correctly, I think.
Yeah, and this, another thing that came to mind just as, you were talking
about these parallels, as, I understand it, the account system with Keet is,
essentially still just a, Key pair.
Correct me if I'm, wrong,
Very, true.
you backups with the same, the same 1224 words.
Is, that fully interoperable as well?
Is that, could be your Bitcoin key.
That could be
We use the, same, I can't remember the date, the BIP, but there's a
BIP for like during key generation.
So we can use it also in the future for other things.
and,
and you have those words, you have your account, and that's, we never store that.
And that's like your sovereignty and, that lets you use it also,
that lets you use it seamlessly on different devices also.
It's one of those things that I love because I know what's going on when
you use keyed Insanely hard problem, but it's solved by the runtime,
and it just works seamlessly and I think that's, the beauty of it.
I think there's some UX stuff to figure out about onboarding that stuff a
little bit easier for normal people.
That's probably to a large degree the same for Bitcoin.
something I'm always, like the first step is always the hardest, I think, but, yeah.
I
The other part that I would do with Bitcoin is that, with Bitcoin,
with your 12, 24 words, you can access your private wealth.
in the same way, so you, the beauty of Bitcoin is that you can remember
12 24 words, you cross borders, and you carry with you your wealth.
You can do the same thing with your digital private life.
You remember 12 24 words, they could be the same by the way.
And, whatever happens, you can spawn back your digital private life fully
encrypted from, one of your other devices that you connected that
is somewhere else in the world.
So when you start seeing and understanding the unlock in terms of also human
resilience that this creates is very, insane and can create a very powerful,
that can be used for, to create a very, powerful applications, again, not just
communications, but you can build.
Really any sort of interaction, even mapping.
Imagine peer to peer mapping, where basically data is not
stored in one single location.
You can access, tiles of the maps, that are more nearby, you from, local
people that curate them in a better way.
So the, level of, of type of applications that you can build, All unlocked by
the same technology that is being used by Bitcoin is very, incredible.
Yes, absolutely it is.
And what do you think of the idea that all of this stuff is just interoperable
now based on essentially you have your private key and there you go.
It doesn't matter the technology stack.
Is that sort of an agnostic thing where you can take your data
to any one of these systems?
What you're building with Keith being one, Nostr being another, Bitcoin being
a third, what do you think of that?
Yeah, the fact that, data is yours, right?
So you should do whatever you want with your data.
That is, I think, an axiom that, that we should assume.
And, it shouldn't even, we shouldn't even discuss about this, right?
We are discussing about it because people are trying to
take away this axiom from us.
But, definitely.
The, you are a key pair, and you're basically, because you are, you just
need, you are, unique, and uniqueness is expressed by the cryptography
around those 24 words, and that's, that also is a way to prove your identity,
it's like, It's the best, it's a mathematical way to prove your identity.
No one can, can steal that from you, of course, but no one will, can track
it as no one can impersonate, should not be able to impersonate you.
So it's, it's truly powerful.
also think it's like worth remembering here also in this discussion that a lot
of very high valuable data for yourself is actually not that big, but centralized
platforms take it hostage anyway.
if you take all my chat history and, I have pictures, but like a couple
of the pictures would probably be bigger than all my chat history ever.
but a lot of that, those messages have a lot of value for me, especially
personally and also being able to search through it and have infinite history,
it's very valuable for me personally.
But it's very scary for me if that's on some other platform where it gets leaked
at some point, et cetera, et cetera.
But we already have the devices, just normal consumer devices that we buy,
that we all have, phones, computers, whatever, that have more than enough
capacity to store multiple copies of this.
Again, you might have some media that might push that a little bit over,
but In terms of like per user, data production, it's a manageable problem.
And I think it's it's interesting
how, much, providers force us to think in terms of giving that data away,
even though we could easily store it.
And this is even more important when we think about potential,
AI applications, right?
So imagine your best assistant.
And, the, the Paolo's assistant should go through all the emails of my emails,
my kids chats, my old social stuff, and be able to be my best assistant.
But in order to do that, I have two options.
Either, I imagine that chat, OpenAI would come with an assistant.
They would upload, All the information on their servers, crunch that information,
and then, use it to serve, service me, but also service their own needs.
And that can become very scary, also because they wear a hat.
It's public, right?
you don't want your most intimate codes that your best personal assistant
could know, to be on somewhere else, rather than your devices.
And so people were, people never uploaded, at least most of the
people would never upload medical, information on Facebook, right?
But they are uploading it on ChatGPT to get a second opinion.
so things can be, get even scarier than what we described today because, we,
discussed about social media, that is basically, the fun part where we upload
photos, when we are eating something cool.
But, things can be, get, become scarier when it comes to privacy
and data control with ai.
So I, I want to see a future where I have a local AI that is integrating Kit, can
read all key messages that I have from my local phone on my local device, and can
become the best powers assistant possible without renouncing to, to my privacy, and
also still governed by the same 24 words.
the fine tuning that is applied on that LLM should stay local to my own device,
and it should be in control of that.
And still, the current power of the devices that we have makes it possible.
We should not fall for the same lie.
We don't need, we, of course, big data centers with GPUs are
important for training a huge LLM, but that is a generic LLM.
You can take that one and then fine tune it with your own
data and run it by yourself.
And for most of it, unless you want to do crazy things, that is more
than enough and can run on modern GPUs or local GPUs or your phones.
So we should not fall in the trap of that, that brought us to think
that the only way to build a system was through a client server.
We should start thinking that we can build local experiences without
having an API all the time connected to someone else's data center.
super interesting.
you briefly just briefly mentioned tether before and I
think we need to get into this.
So we're running a little short on time here because we're, curious to know,
how tether works and, why, It's a tool on the path to hyperbitcoinization.
what is it and how much of a maxi are you, Paolo?
And, what, made this thing happen?
Can you give us the story here about Tether?
Tether started in 2014.
I personally am, I consider myself a maxi, but running Tether, you
could say that, I'm a shit coiner.
I don't mind, right?
I like what I do, and I think I'm net positive, so it's okay.
Tera was born in 2014 with a very simple idea.
we had different crypto exchanges, not, us, but in general, there were
a few crypto exchanges in, 2014.
was Bitfinex, Coinbase, Kraken, Bitstamp.
OKCoin, there was BTCChina, and just a few others, right?
Around 10 that were meaningful.
The problem back then was to do, trading arbitrage, you sell Bitcoin
on the exchange where the price is higher, you take the dollars.
From that sale, you move the dollars on the exchange where the price
is lower and rinse and repeat.
That is called arbitrage.
It is a property of every single efficient financial system.
And that also helps to keep the price of Bitcoin in line
across different exchanges.
But, that was very, hard in 2014.
If you remember in 2013 was the first year that Bitcoin broke the,
Bitcoin price broke the 1, 000.
But on some exchanges the price was 1.
2, on others was 900.
And in order to arbitrage that price difference, you have to move dollars
from one exchange to another and Bitcoin from one exchange to another.
You can move Bitcoin from one exchange to another.
10 minutes, but dollars would take days, right?
International wires.
And so of course the opportunity arbitrage was go, was, fully gone
by, by, the, time the wire was hitting the, receiving exchange.
and the reason why we created that was, USDT was simply to put the dollar on a
blockchain so that we could have the same user experience that we had with bitcoin.
And to make arbitrage very, simple.
For the first two years, almost no exchange apart Bitfinex understood USDT.
Then Poloniex in 2016 started to add the USDT across for against
every single trading pair.
There was the start of the ICO boom.
2017 was the peak of the ICO boom and, USDT reached 1 billion in market cap.
Fast forward in 2020,
we had around 10 billion in market cap, and then the bull run started,
but also another important thing started, that was the pandemic.
So the pandemic had a huge effect on many economies around the world, in all the
economies around the world, but especially in emerging markets, developing countries.
Basically pandemic also killed entire economies.
And so as a Bitcoin you would think, oh, all these people that are in countries
like Argentina and and Venezuela and Turkey and so on, they should use Bitcoin
and they should, they should, only use Bitcoin because everything else is cheap.
So that is pretty much, the approach that we have as Bitcoiners that, I believe in.
But the problem is that.
Not everyone is ready, so not everyone has our time to understand Bitcoin.
Not everyone has yet the full skill set to understand Bitcoin at this
stage, at this moment in time.
we as Bitcoiners didn't build the best user experience in the world, right?
So one of the best wallets for Bitcoin is still Electrum.
That, is not necessarily nice and well done for and simple to
be used for, a 70 year old lady.
so we need to do a better job as Bitcoiners to build better user
experiences we want Bitcoin to be more used around the world.
At the same time, 99 percent of the population knows, especially the ones
that are living in high inflation areas, knows that there is the dollar
that is usually Much better currency than what they hold in their hands.
the US dollar is not, definitely not perfect.
It's not the perfect fiat currency.
but it's like the tale of the two friends running away from the lion, right?
you have, one friend tells to the other, Oh, the lion is gonna kill us.
We have to run really fast.
And one of the two friends says to the other, I just have to
run faster than you, right?
So the US dollar is the friend that is running faster, in a sense that is the
one that is likely better than the others.
And so being better than the others is creating a sort of safety feeling
among 5 billion people in the world that live in high inflation countries.
And for those people that, they don't have yet the time, they didn't have
the time, they didn't have the luck also, maybe, to understand Bitcoin,
they are, in fact, using USDT.
they had, If you live in Argentina, peso lost 98% against the US
dollar in the last five years.
The Turkish L lost 80% against the US dollar in, the last five years.
So of course, Bitcoin would be better than the US dollar, but even already,
if you hold the dollar, you are the king of a hill of the hill there, right?
So because it's, you are able to preserve your wealth much, better than almost
anyone else in, in, in the region.
I think, the way I see it is that, USDT is offering a temporary solution
and is providing a service, a very good service to people that don't have
alternatives and good alternatives and they are very, familiar with the U.
S.
dollar already.
so eventually, the hyperbitcoinization, I don't, I think it will happen.
There is, there is no way it won't happen.
It's hard to pinpoint on a time when, that will happen.
But it's all about the turning point.
What the economy will look like in the next, 10, 20 years and what trigger
point there will be for fiat currencies to blow up and become irrelevant.
the way I see it is that it's likely that the U.
S.
dollar will stay around for a while, and people might still want to use, the U.
S.
dollar for, as a checking account, but they, should UBU start to use, the,
Bitcoin as their savings account, in the checking account, you want to, even today,
you, are happy to not make interest, on the checking account, It's something
that you use for payments, it's something that you are okay to detach from it
from your checking account because it's the money that you are ready to spend.
The savings account is the thing that we should fight for.
This thing is the thing that matter the most, and, it's, it's the thing
that will is protecting people wealth.
And so in the long term.
And in the medium term, we should push for this savings account to be Bitcoin.
also with Tether, we are heavily investing in companies, in Bitcoin companies.
we support the Blockstream.
We supported so many in the space that are, we, are supporting RGB.
That is a protocol that is building, assets on top of,
like network, style channels.
Thank you for listening.
and we buy Bitcoin ourselves.
We do a lot of Bitcoin mining.
We develop, I think, the best and most sophisticated Bitcoin mining software, by
the way, based on hole punch technology.
It's like IoT for Bitcoiners and Bitcoin mining.
It's very cool.
I, think that, definitely, we are relying on the dollar and, and, the,
definitely in a way you could see that, you could say that USDT is helping the
dollar, expansion, but the same way I don't think Dollar and Bitcoin aren't
necessarily opposed to one or the other.
I think that Bitcoin has its own path.
And no matter what happens, there is no way to slow it down.
I think, it's going to be inevitable success.
It's going to be inevitable that it will become global internet
money and global words money.
No country will trust to each other with, with each other currencies
for, for a longer time, and so the only viable solution is a
currency that is governed by math.
That is the only objective way, objective thing that we have in the universe.
that's my train of thoughts on, Tether and Bitcoin.
Oh, thank you.
Thank you for that explanation.
It explains a lot of things.
To me, it sounds a bit like you're a lubrication company, like selling
lubrication for the transition between the rape of the dollar to the love
fest of the hyperbitcoinized world, to make the transition a little smoother.
If,
we are more than, at Tether we have also this educational arm and, believe it or
not, our, the majority of the creation we do is actually on Bitcoin, right?
So we have the, we are supporting the Plan B network led by the great Giacomo Zucco.
we try our best to go around and, The unfortunate thing is that USDT,
we, didn't have a marketing team up to, 2022 with u with Tether.
So basically, I wish I could say that success of Tether is because
we were super intelligent and great.
but actually the success of Tether, unfortunately is a symptom of the
success of, of, national economies.
And it's sad if you think about it, right?
So the success of your main product U as it is, They're actually proportional
to the FACAP of many central banks.
And, but it is what it is, right?
So we need to do what we do at, really, at DataRace, creating all these educational
contents to try to explain that, sure, we are providing a tool for today, but,
For tomorrow you probably need, you need to understand that you have other
options, you need to understand Bitcoin, because as we said for, Keith, right?
So the moment when you will need the most Bitcoin, it has to be
available, you need to understand it, so that is a true option for you.
So that's, the key.
The way we are, we, see bitcoin education.
No, and, I, something like Tether would have, emerged, either way, and
it's very comforting to know that it's run by Bitcoiners and not by
a central bank itself or something.
yeah, and the Plan B Network, I was a guest lecturer there
in Logano and it was fantastic.
I love what you're doing there with the educational hub.
And we even got Giacomo to write the foreword to our new book here
that you can see here behind Luke.
and Fine World.
Always say the title, Knut.
Always say the title.
Bitcoin, the inverse of Clown World.
It's, you, if, you're good at maths and emojis, you might be able to figure out
the title from the cover, but it's one divided by Clown World anyway, which is
on the opposite side of the everything divided by 21 million equation, So
anyway, looking forward to, yeah, to seeing you in Lugano and giving you
both a copy of the book, of course.
Oh, with pleasure, with great pleasure, with a nice, education.
How you call it like the,
Absolutely.
Yeah, you'll get signed copies.
Absolutely.
Yep.
100%.
And we have to wind things down, but I'll just say as well, yeah, absolutely
looking forward to Lugano Plan B Forum.
Always a highlight of the year.
It was my first time last year.
I absolutely loved it.
can't wait to attend this year.
Yeah.
anything you want to say about that, by the way, just, since we're
here, we've got a few minutes left.
so it's the 25th, 2020 6th of October, 2024.
this year,
it's a Bitcoin event that is not made to make money.
So the problem with, with events is that.
You have to find sponsors, and usually, sponsor might not be well aligned with
the message you want to give, right?
I think Tether is lucky enough, to not have to make money on the event.
I want to have, good, guests.
I want to have great speakers.
I want to have the messaging.
That is not only about Bitcoin, it's about, freedom of speech as well.
We had the family of Assange for the last few years, and I think
that they will come also this year.
By the way, we are going to also launch an event.
I'm going to be probably killed by the By our marketing team, I'm not sure if they
announced it, but we are going to have another Plan B event also in El Salvador
next year, so we're trying to create this network of cities and countries that have
things in common and, invite people that want to share knowledge around the world.
And, yeah, and of course we, are very proud of the good
food that we, serve in Lugano.
So that is another thing that, not all the bands can say the same thing.
No, it's fantastic.
And we happened to bump into the Assange family at the cocktail bar in, in, in
a fancy hotel and, had a, had a very interesting conversation with them there.
So if you're listening.
Anyone from the Assange family is welcome on the show any time.
So yeah, no looking forward to, to that event for sure, we had a great time.
And I think we're even playing this year, aren't we, Luke?
You're
yeah, the Satoshi, I understand it, the Satoshi Rakamoto is the, is in the
event there, yeah, we, we, played, in, back in Prague, it was my first, time,
but Knut is a regular at the Rakamotos.
What, what you're playing?
Which, which songs?
too.
Oh, anything and everything, what did we do in Prague?
We did some,
paranoid and,
Can I
commission a song?
Yeah, sure, What song would you like to hear?
I have two that I would suggest.
One is Nothing Else Matters.
Alright.
So I think that, that is, that also is very inspiring, right?
Bitcoin, for sure.
Nothing Else Matters.
it's perfectly aligned with Bitcoin.
And, the other one is Sad But True.
I'm a big Metallica fan,
Oh, that would be fun.
That would be fun.
Yeah.
We'll squeeze in some Metallica there, won't we, Luke?
we'll 100% have those songs ready to go.
I, guarantee you that.
We also have, there's also a big peer to peer track at the conference, not so
much music, but, but yeah, that's peer to
looking forward to that.
Hey, we have to wind things down here because, yeah, we're, almost, out of time.
So I'll just hand this, back to you both.
Is there anything else you'd like to, mention about, say, the, your plans
in the upcoming couple of years, in, key, toll, punch, anything like that?
only that we're, like I said, we're integrating really hard right now,
and it's a really fun time to, to both join the company because, we're
small and efficient and, We get to work with Tether, which has a lot
of benefits and it's getting really fast, so definitely check that out.
And it's also a really fun time to join Keith in our public rooms.
There's a lot of very personal, in a good way, intense chats where
you get to be part of the loop.
I love to be part of those early communities and I would suggest
everybody to check that out and go to the website and try it out.
we will certainly do that.
yes.
Yeah, I couldn't agree more.
So go check out Keith and Holepunch and the Plan B forum in Lugano,
And also go to the Bitcoin Infinity store and check out
that and what you can find there.
You could visit tether.
io, that is, the website where we are trying to explain what we have in our
minds between, finance, bitcoin mining, energy production, AI, communications,
brain chips and stuff, right?
I think it's more exciting.
Just those things, that's all.
Yeah, we are probably, we, I don't know, we can piss off more than this.
Thanks.
No, it's just perfect.
It's just perfect.
and is on that note, is there anywhere else specific you'd
like to direct our listeners?
just follow the social channels and give us feedback on kit all the time
because it's, these technologies, needs everyone's help to be nailed them.
We love technical feedback.
We love UX feedback.
We love all the feedback.
We're trying to make something that works for the masses, so anything is good.
Fantastic.
So that's, all at Keet.
io.
Is that correct?
For Keet?
Key.
io and pairs.
com for our runtime.
That's the only links, and then there's no links after that.
It's all peer to peer.
Wonderful.
And you're also still on the legacy social media platforms, right?
Twitter at minimum?
Yeah.
we'll make sure to include links to your handles so people can
find you there if they would like.
So Paolo, Mathias, thank you very much for joining us.
This has been the Bitcoin Infinity Show.