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Mr.

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Mechanic, welcome back.

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Hello.

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Hi, Luke.

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Telling my kids this was Luke Jr.

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Thank you.

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Yeah.

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Yeah.

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It sort of is from a certain perspective.

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Yeah.

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Well, welcome.

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Great to have you.

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great to have you back.

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Thank you for having me.

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I'm sorry if I'm a bit surly.

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I'm a bit jet lagged, you know.

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Um,

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And we're a bit tired, so this is going to be our best episode.

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We

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it'll be really good.

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Yeah.

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Yeah.

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This is gonna be great.

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Ha ha ha.

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Alright.

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So.

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I thought we'd start this by coming full circle to the thing that your wife asked

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me when we first met, uh, like, or we, she asked me at the Horsepower Ranch,

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which in, in Mexico, the Baja, which is like the middle of the middle of nowhere.

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Uh huh.

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or the outskirts

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edge of nowhere?

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It's right

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of nowhere.

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endless ocean.

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yeah, yeah, yeah, that's that.

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Ensenada, right?

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Like, just below Tijuana.

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yeah, well, the ocean is actually nowhere, isn't it?

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So Hawaii would be in the middle of nowhere.

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And

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Yeah, I think so.

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anyway, the thing she asked me is a very simple question, which I've been trying

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to, like, refine the answer to over the years after, after she first asked it.

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And it's the simple question, what is Bitcoin?

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Yeah, I think it is whatever we make it.

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I think that's, it, it changes, right?

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It's a, it's a set of rules, uh, that can change.

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It's a protocol.

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And that's like, so my favorite analogy is always the language analogy

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because language is a protocol that everyone will happily adopt and use

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and correct people if they use it wrong and update their own understanding of

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what the rules of the protocol are.

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So that, that totally applies to Bitcoin.

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So, rules change over time, you know, uh, it's a set of rules

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enforced by voluntary participants.

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That's what Bitcoin is.

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It's a protocol.

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It's a set of rules that is followed voluntarily by a bunch of people.

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It's, it's, that's all it is.

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Just a evolving set of rules,

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Uh, it's close to my answers, uh, I, I,

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and copy in my homework

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copying your homework.

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I usually answer, it's a, it's an agreement on a fixed set of rules

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that are very hard to change.

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And the reason we agree on the rules is that they're more

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expensive to break than to follow,

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Yeah,

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creates, you know, absolute finite number and not being able to copy and all of

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the other nice censorship resistance.

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and no because breaking the rules isn't like The point is it's because

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you're not breaking the rules.

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I mean the implication here is doing something like a 51 percent attack

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That doesn't violate the protocol, it just violates the expectation of

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what other people think you might do.

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And especially in current scenario, where Bitmain can 51 percent attack the

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network, if they want, at any minute.

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Like, it doesn't, importantly, that doesn't violate the protocol.

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If it did, we wouldn't have to worry about it,

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Please explain that.

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Bitmain make all the hardware, and they run all the small pools, and they run a

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big pool too, and if you add it all up, it's over 51 percent of pool dominance,

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and it's over 80 percent of hardware dominance, which is all closed source

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and backdoored, and, like, they just run that entire part of the ecosystem.

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Unfortunately, there's Bitcoiners, and laser eyes, and like maxis, and

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ideological bitcoiners, and this is the world I've been in forever, and mining

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went off on its own tangent, and it's basically just run by one Chinese company,

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and if you go and, like Viabtc is an old partner of Bitmain, and You go on

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the CEO's Twitter page, and it's just a Bitcoin cash flag, and these guys have,

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they would switch in five minutes to doing whatever gets them more fiat, right?

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It's the idea that they're somehow part of the ecosystem, or the game

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theory will magically keep us all in alignment, and it's all fine.

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It's I'm, I'm rambling already, but this is the analogy I came up with

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earlier, like, someone, someone was worried about something Bob Burnett

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said at the conference right here, and they went and went to their

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guru, Michael Saylor, and went, Bob Burnett's worried about centralization

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of template construction in mining.

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And, uh, apparently, this is like Chinese whispers here, but Saylor was

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like, well, don't worry about that.

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Because if the centralized template constructors ever did anything bad,

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then all the miners would just switch, which is like the old cope from 2015.

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And then the guy went back to Bob Burnett and went, yeah, okay,

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apparently that isn't a concern, Michael Saylor says, because all

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the miners will just switch, right?

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And I was like, this is, this is like, my parallel for this is like, I'm

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trying to explain Bitcoin as two no coiners, as a monetary network, a medium

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of exchange, not a store of value.

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And they're like, why do I need this?

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I, I send my products.

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Payroll Lil goes out over PayPal every month.

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What's the issue?

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Why do I need Bitcoin?

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I'm like well because PayPal can de platform you they can cancel you and

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they're like, oh, don't worry about that If they ever did that, I would

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just use Venmo instead I'm like you you do not understand what building

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a resilient system is or like why you create redundancy and you you

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you Caught you caught inefficiency just as a means of You know, I

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don't want one guy to do this thing.

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I want 8 million people to do this thing.

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Even though 7, 999, 000 was all redundant, it just means governments

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can't stop it anymore, which is what the whole point of the thing is.

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That's it.

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So mining, mining is centralized.

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At the end of the day, it's centralized and getting worse.

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And people are now resorting to COPE.

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They're no longer interested in anti fragility.

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They're just saying, it doesn't matter because bitcoin somehow will just work.

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Like, it's, it's literally just it is bitcoin to no coiners.

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You're saying centralized payment networks are fine because if any one of them

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messes around, free market will fix it.

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And so that's, that is not a reliable argument.

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System for you to build an economy on.

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Okay, well, I'm, what I'm thinking of is that, that famous Antonopoulos

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video where he explains the 51 percent attack, and he says that all they

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could do was one double spend, and then we'll kick the fuckers off the network.

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And so what would happen if Bitmain actually pulled off a 51 percent attack?

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What do you see happening, like, if they actually do that?

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I think, um, you'd see a disappointing and underwhelming reaction to it.

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Um, at the moment, we're all boiling frogs.

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Um, everything's gone way over the limit of what should have

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been tolerable to bitcoiners.

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Um, and comparatively, we're just not anything like as

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vigilant as we used to be.

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Bitcoin was always going to be a victim of its own success.

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Um, and it's now inundated and diluted with people that Even if

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they really care about it, they just don't understand it that well,

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and they don't know the history.

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So, GHash.

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io was a big pool, got too big, spooked the network, and everyone

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abandoned it, and it died.

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Uh, Bitmain is in that position now, and they have this silly game they play, where

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they pretend to not be as big as they are, via the use of proxy pools that make the,

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I see that, but if they actually pulled

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Yeah, yeah, I'm getting to that.

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I'm just saying, Hmm.

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If, given that we're already past the point where they can, which was sufficient

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to cause alarm before, I don't somehow expect Bitcoinists to go, Alright,

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that's too far, and all the frogs to jump out of the hot water because they,

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they, you know, actually did that.

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I know what Andreas was saying, he's saying, you know, just an economically

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rational actor would never 51 percent attack if they were in a position to,

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because why would they undermine Bitcoin?

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The entire, why would they bite the hand that feeds them?

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I get that, it's logical, but Bitcoin does not exist in its

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own game theoretical vacuum.

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Someone can come, I don't care what it is, if the, if the, if

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the CBDC people are like, right, we're pulling the trigger today.

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This is, if, if the, if the Chinese government wants to come to Bitmain

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and say, right, you're doing this now, it's to, it isn't, I'm not going

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to rely on Andreas video saying, oh, don't worry, they won't do

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that, it's economically irrational.

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Like, they have a gun to their head, and Bitcoiners can either, React strongly

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to it and do what they need to do.

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Or they can cope and say, Oh, it doesn't matter.

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Someone else will include the, like it's, what are they doing

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with the 51 percent attack?

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Are they just mining empty blocks?

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Are they double spending?

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I would think it would probably be a censorship attack more than,

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uh, a reorganizing of the chain, which does undermine Bitcoin more.

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Um, so the former, um, in an, in a scenario where they do that, I think

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Bitcoin is, would largely just stay boiling frogs in the pan and say, This

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sucks, and then the publicly traded miners that are mining with this.

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I mean, they tend to be more North American based, so they all go

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to Foundry instead of Bitmain.

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Foundry will pick up some of the slack, but then it depends

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what's going on politically there.

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If someone's holding a gun to Foundry's head too, and saying, you need to

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censor, um, the idea that the, the riots and the marathons Not Marathon,

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because they're their own thing.

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The Hut8s, and the BitFarms, and the CleanSparks, and those publicly

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traded companies, the idea that they would just all switch pool.

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I don't know where they could even go, because the requirements that are placed

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on them to be allowed to be miners in a publicly traded capacity mean that

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they can't really move, and even if they could, they're not going anywhere quickly.

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So, I think very quickly, what, how it would actually play out is Um, assuming,

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you know, disaster scenario, you've got Foundry and you've got Bitmain, like,

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conducting a censorship attack, those two alone are already around 50%, if

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you don't even include the proxy pools, like Brains and all those guys that

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are really just Anpool at this point.

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If those guys are censoring and they're doing it according to some blacklist,

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like OFAC compliance, something like that, um, Most Bitcoiners are going

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to say, well, I'm not on that list.

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So, you know, I'll carry on using it.

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The price might fall a bit.

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The price also might go up a lot, right?

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Like when, do you remember when Silk Road got shut down?

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The price, this was October 2013, or 2012, was it?

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I don't even remember, but the price went like, The market had

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a schizophrenic reaction to it.

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It went extremely far down because a lot of people thought like Silk Road is

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the killer use case for Bitcoin, right?

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And then it went all the way in the other direction.

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Like it was two God candles, like in both directions and everyone, because

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a lot of people just appreciated like the new found legitimacy of Bitcoin.

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We've shaken off this nasty drug stuff, right?

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So if they're putting pools in a position, Like, are the, like, the billionaires

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that are putting their company balance sheet on Bitcoin, are they gonna care if

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there's a UTXO blacklist that's all these nasty drug dealers and Russian oligarchs?

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They might see it as a good thing.

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So, in, just to round off the point, um, I don't, you're not

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going to see the publicly traded guys switch pool in that scenario.

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They might even welcome it.

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And even if they, with the best of intentions, wanted to switch, The

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regulators have got them by the balls and they can't, like if, like, I work

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for Ocean, if, if these publicly traded guys were like this sucks, Foundry is

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censoring, we're gonna switch to Ocean.

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They literally can't.

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In most contexts, they can't because we don't have the necessary, we, they want

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00:11:24,881 --> 00:11:28,721
us to KYC all of our miners and we're not prepared to do stuff like that.

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That is prohibitive for them.

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So, I mean, in that scenario, I basically think this cope that Andreas has is

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just, It's no more than conjecture, and I don't think it's based on any

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sort of pragmatic understanding of what most Bitcoiners are these days.

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No one is gonna dump their Bitcoin in that scenario that you might think, because

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where, what are they gonna dump it for?

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Bitcoin is still going to be the best thing, even with centralized mining.

239
00:11:53,206 --> 00:11:55,096
This is what I mean with boiling frog syndrome.

240
00:11:55,271 --> 00:11:58,436
Yeah,

241
00:11:58,621 --> 00:12:01,641
I don't like the term circular economy, because as you say,

242
00:12:01,641 --> 00:12:02,991
nothing exists in a vacuum.

243
00:12:02,991 --> 00:12:07,001
Everyone's action influences everyone else's action, the Kevin Bacon numbers

244
00:12:07,001 --> 00:12:11,241
and whatnot, like we're all connected in this, but, but to, to take it back

245
00:12:11,241 --> 00:12:16,481
to the MT Gox thing, I, I remember how I reacted to that when it happened.

246
00:12:16,551 --> 00:12:20,591
I mean, I wasn't deep into Bitcoin at all at the point, but I was very

247
00:12:20,591 --> 00:12:21,851
interested in what was going on.

248
00:12:22,296 --> 00:12:25,946
And to me, it was, uh, not that, oh, okay.

249
00:12:25,946 --> 00:12:30,386
Bitcoin is legit because now the, the, the drug use narrative is gone.

250
00:12:30,396 --> 00:12:32,046
It was more like, okay.

251
00:12:32,486 --> 00:12:37,766
One entity, one large fucking entity went down and Bitcoin still works.

252
00:12:37,856 --> 00:12:39,626
Therefore, number went up again.

253
00:12:39,936 --> 00:12:42,556
And, and that's like what I hope will happen now.

254
00:12:42,556 --> 00:12:46,166
If, if, uh, there's like a 51%, like, don't you think that

255
00:12:46,176 --> 00:12:47,916
kind of mindset is still there?

256
00:12:48,679 --> 00:12:49,899
that's a very good point.

257
00:12:50,469 --> 00:12:53,059
That's one of my favorite things to sort of mention.

258
00:12:53,394 --> 00:12:58,794
About like, bad things happening and Bitcoin surviving them and thus becoming

259
00:12:58,794 --> 00:13:02,984
not theoretically anti fragile, but in practice demonstrating it's anti fragile.

260
00:13:03,589 --> 00:13:04,069
perfect example.

261
00:13:04,514 --> 00:13:04,794
Mt.

262
00:13:04,794 --> 00:13:07,364
Gox is a good example, Gavin Andreessen is a good example, China

263
00:13:07,364 --> 00:13:08,924
mining bans are great examples.

264
00:13:08,924 --> 00:13:13,214
Like, I use this frequently when I'm like, you know, pontificating on this

265
00:13:13,214 --> 00:13:18,134
stuff as I like to do, but I think when it comes to mining centralization,

266
00:13:19,159 --> 00:13:21,389
No, I don't think that applies, sadly.

267
00:13:21,389 --> 00:13:25,719
I don't think someone does a 51 percent attack, the community responds in an

268
00:13:25,739 --> 00:13:32,759
agile way that's commensurate with the cypherpunk ethos, deals with

269
00:13:32,759 --> 00:13:36,489
it, roots around it, and we go, hey, we dealt with the theoretical 51

270
00:13:36,489 --> 00:13:41,679
percent attack and proved that the practical response to it actually is

271
00:13:41,679 --> 00:13:43,429
something that we can expect to happen.

272
00:13:43,979 --> 00:13:48,049
No, I think we'd be very disappointed in that space because of how

273
00:13:48,069 --> 00:13:50,499
divorced mining is from Bitcoin.

274
00:13:50,699 --> 00:13:56,009
They are super separate, like not just aesthetically, but this has been something

275
00:13:56,009 --> 00:13:59,659
that's been just more and more obvious to me since working with Jason and Luke.

276
00:14:00,034 --> 00:14:05,884
In, uh, Ocean, because none of the miners are really that well versed in what's

277
00:14:05,884 --> 00:14:11,244
going on in the Bitcoin space, uh, with development, and with, like, these,

278
00:14:11,774 --> 00:14:16,514
you know, the concept of not your keys, not your coins, okay, it's a big part

279
00:14:16,514 --> 00:14:20,864
of hodl culture, it is not a big part of mining culture, because everyone is

280
00:14:20,864 --> 00:14:24,294
happy just having all of their rewards go straight to the pool, and then the

281
00:14:24,294 --> 00:14:28,469
pool pay them from some other source, And this is not even a, like when Ocean

282
00:14:28,469 --> 00:14:31,599
comes out and says, Alright, our biggest 16 miners will get paid in the block.

283
00:14:31,599 --> 00:14:34,749
So the money, the minute it exists, it's already yours.

284
00:14:34,969 --> 00:14:36,059
Like, we can't even touch it.

285
00:14:36,059 --> 00:14:39,109
And because we go from the top down, that results in 90 percent

286
00:14:39,129 --> 00:14:43,569
of the new coins getting created by Ocean, never touch our hands.

287
00:14:43,809 --> 00:14:45,449
And this was something I thought.

288
00:14:45,984 --> 00:14:49,084
If the mining culture reflected Bitcoin culture, that would

289
00:14:49,084 --> 00:14:50,414
be like, this is fantastic.

290
00:14:50,674 --> 00:14:52,254
Instead, it barely moved the needle.

291
00:14:52,304 --> 00:14:54,774
Because people are like, oh, why do I need, why do I need to take

292
00:14:54,774 --> 00:14:56,344
custody of my coins immediately?

293
00:14:56,344 --> 00:14:58,524
I'm like, for obvious reasons, right?

294
00:14:58,564 --> 00:14:59,124
For Mt.

295
00:14:59,124 --> 00:15:00,654
Gov, for not your keys, not your coins.

296
00:15:00,654 --> 00:15:01,414
And it's like, no.

297
00:15:01,834 --> 00:15:02,724
And then you have, you.

298
00:15:02,954 --> 00:15:06,664
You know, who's going to run Bitcoin Core if it's closed source

299
00:15:06,804 --> 00:15:08,354
and we find backdoors in it?

300
00:15:08,434 --> 00:15:09,624
Who's going to accept that?

301
00:15:09,694 --> 00:15:10,554
That would be a joke.

302
00:15:10,554 --> 00:15:11,744
We'd get laughed out of the room.

303
00:15:11,754 --> 00:15:13,304
Like, even shitcoins don't do that.

304
00:15:13,544 --> 00:15:16,364
Whereas the majority of the hardware on the network is all made by one

305
00:15:16,364 --> 00:15:20,334
company with closed source firmware that we found backdoors in before.

306
00:15:20,384 --> 00:15:21,664
Antbleed was a thing.

307
00:15:21,944 --> 00:15:23,754
We knew they had remote access.

308
00:15:24,034 --> 00:15:26,164
They could shut down any ant miner in the world.

309
00:15:26,204 --> 00:15:27,144
Bitmain could do it.

310
00:15:27,194 --> 00:15:30,744
We caught them in the act and they went, Oh, this was supposed to be, uh You know,

311
00:15:30,744 --> 00:15:34,574
like, how Apple can shut down an iPhone if you report it as stolen, and, uh,

312
00:15:34,624 --> 00:15:36,114
but don't worry, we've got rid of it.

313
00:15:36,164 --> 00:15:40,354
And like, we, we totally caught you, everyone is still doing it, and, like, the

314
00:15:40,354 --> 00:15:46,014
ideology of, like, why would you run on your local area network at home, closed

315
00:15:46,014 --> 00:15:49,614
source firmware by a malicious company that's tried to hijack the protocol

316
00:15:49,614 --> 00:15:54,244
before, and everyone's just like, meh, you know, I, I, I spend this much on

317
00:15:54,244 --> 00:15:56,424
electricity, I get that much back in sats.

318
00:15:57,029 --> 00:15:57,919
You know, it's fine.

319
00:15:57,969 --> 00:16:00,009
Like, most of the time they're dealing with electricity and

320
00:16:00,019 --> 00:16:01,389
real world stuff like that.

321
00:16:01,399 --> 00:16:05,019
So, like, just, I'm just trying to illustrate how divorced

322
00:16:05,049 --> 00:16:06,359
the two mentalities are.

323
00:16:07,614 --> 00:16:11,594
perfect illustration I saw today at the expo area in the conference.

324
00:16:11,594 --> 00:16:14,254
I mean, this is one of the most high signal to noise

325
00:16:14,254 --> 00:16:15,774
ratio conferences there is.

326
00:16:16,144 --> 00:16:20,614
But, but it's not completely devoid of crypto, quote unquote, crypto.

327
00:16:20,649 --> 00:16:21,409
There's some of it.

328
00:16:21,444 --> 00:16:26,684
so I saw some mining, some, I don't even know what the company was, but there was

329
00:16:26,684 --> 00:16:33,594
a couple of, of miners, a couple of ASICs, and they had each had a sign above them.

330
00:16:33,654 --> 00:16:38,184
And when one said, uh, had the Bitcoin logo and 11 per day.

331
00:16:38,224 --> 00:16:42,754
Another one had the Dogecoin logo and 27 per day.

332
00:16:43,074 --> 00:16:47,364
And it's like, holy shit, are miners, is this how miners think?

333
00:16:47,404 --> 00:16:52,374
Are they that, you know, low, short, short term oriented?

334
00:16:52,484 --> 00:16:58,054
So, so that they just think like, okay, uh, I can make more money mining Dogecoin.

335
00:16:58,054 --> 00:17:01,084
And therefore they do like, is that, is that how this works?

336
00:17:01,239 --> 00:17:04,499
Well, people are scared of altruism and, like, ideological

337
00:17:04,499 --> 00:17:06,429
commitment to Bitcoin inside mining.

338
00:17:06,959 --> 00:17:11,489
And, like, You know, this was a big pushback from Ocean's anti spam

339
00:17:11,489 --> 00:17:15,179
stuff, was like, you're, you're relying on the altruism of minors.

340
00:17:15,459 --> 00:17:19,069
That's a no no, you've committed an ideological sin in the space.

341
00:17:19,099 --> 00:17:26,339
We cannot ever go outside of, like, pure, like, just naive libertarian approach of

342
00:17:26,339 --> 00:17:30,639
no one ever does anything unless there's, like, not only is it profitable for just,

343
00:17:30,809 --> 00:17:34,739
like, for them, but it also has to be only in the short term that it's profitable.

344
00:17:35,104 --> 00:17:39,154
Like, I'm not gonna sit here and discuss libertarianism, like, I find

345
00:17:39,154 --> 00:17:43,064
it complete, it's incomplete, like all ideologies, like, obviously I like

346
00:17:43,064 --> 00:17:48,124
it, and I'm partial to it, but, like, by this logic, no one is going to fix

347
00:17:48,124 --> 00:17:51,774
bugs in Bitcoin, no one's gonna work on anything, no one's gonna educate.

348
00:17:52,314 --> 00:17:55,414
Like, I hate it because you always have to backwards rationalize it

349
00:17:55,414 --> 00:17:58,464
and go like, Like, I'm doing this podcast and I'm talking to you about

350
00:17:58,464 --> 00:18:00,224
it because I care about this stuff.

351
00:18:00,354 --> 00:18:01,064
That's it.

352
00:18:01,404 --> 00:18:06,034
And like, yeah, you can, you can play this stupid game that libertarians always do

353
00:18:06,214 --> 00:18:09,244
where they have to go, Yes, but you care about it because you have your money in it

354
00:18:09,254 --> 00:18:10,744
and you need to protect your investment.

355
00:18:10,764 --> 00:18:13,919
And also, Maybe it's good for your, like, you're gonna get more

356
00:18:13,919 --> 00:18:17,349
followers from it, or, you're gonna, like, they just, they always have

357
00:18:17,349 --> 00:18:18,989
to come up with some profitability

358
00:18:19,514 --> 00:18:21,124
is an incentive too, I would say.

359
00:18:21,144 --> 00:18:21,944
It's like a, to

360
00:18:22,169 --> 00:18:26,349
able to look at yourself in the mirror when you get up is an incentive, so

361
00:18:26,419 --> 00:18:28,059
I hate that they always exclude that.

362
00:18:28,309 --> 00:18:31,639
So I'm like, miners, if you're aware of the fact that you're participating

363
00:18:31,649 --> 00:18:36,569
in an attack on the network, it's self evident that you're not going to want to

364
00:18:36,569 --> 00:18:38,159
do that once you understand what it is.

365
00:18:38,459 --> 00:18:43,589
Ignorance is fine, but I don't, it's not, it stops being ignorance

366
00:18:43,589 --> 00:18:47,419
after a while and it becomes active participation and willful participation.

367
00:18:47,659 --> 00:18:51,229
Like, ignorance, like, who's that guy, I really like listening to him, he's like

368
00:18:51,229 --> 00:18:56,789
a natural law advocate, Mark Passio, he talks about, you know, ignorance.

369
00:18:56,809 --> 00:19:00,659
You know, put, describing it as like, you know, there's, there's

370
00:19:00,669 --> 00:19:04,539
not knowing something, but then there's, when the information enters

371
00:19:04,559 --> 00:19:06,164
the, the, the field, the field.

372
00:19:06,474 --> 00:19:08,314
And you choose to ignore it.

373
00:19:08,364 --> 00:19:09,764
That's why it's detestable.

374
00:19:09,774 --> 00:19:13,194
That's why when you call people ignorant, it's like, it's not that you're not aware

375
00:19:13,194 --> 00:19:17,004
of the thing, you know it's out there, but you're choosing not to think about it.

376
00:19:17,314 --> 00:19:21,824
So this is why when miners do this, when miners participate in the ongoing

377
00:19:21,824 --> 00:19:26,514
attack, that it's being, you know, mischaracterized and butchered and

378
00:19:26,514 --> 00:19:31,369
you have these Former heroes, Bitcoin Magazine, turning into absolute

379
00:19:31,579 --> 00:19:35,899
putrid, like, bottom of the barrel attackers, trying to undermine all

380
00:19:35,899 --> 00:19:38,289
of these central characteristics.

381
00:19:38,709 --> 00:19:44,629
When you have that stuff going on, and it boggles the mind, because you

382
00:19:44,629 --> 00:19:49,359
know that if you surround yourself with snakes and shit coiners, it

383
00:19:49,389 --> 00:19:51,299
leads to psychopathy pretty quickly.

384
00:19:51,309 --> 00:19:55,229
You watch all these people unravel very quickly, like, in their own, you

385
00:19:55,229 --> 00:19:59,049
know, Mess, but I'm like, I don't, I care about that, and I will help you

386
00:19:59,049 --> 00:20:03,399
not do it, but, out of compassion, but I don't want you to bring down

387
00:20:03,399 --> 00:20:04,939
the network while you're doing it.

388
00:20:04,949 --> 00:20:08,849
So you have a hundred million UTXOs turn into two hundred million

389
00:20:08,849 --> 00:20:10,589
UTXOs in the space of a year.

390
00:20:10,789 --> 00:20:13,379
You have the implications for node runners.

391
00:20:13,954 --> 00:20:14,514
And,

392
00:20:14,884 --> 00:20:16,264
Please explain why that's a problem.

393
00:20:16,714 --> 00:20:19,174
well, it just makes it harder to run a node.

394
00:20:19,214 --> 00:20:26,444
It's, practically speaking, it seems like I'm still benchmarking, right?

395
00:20:26,554 --> 00:20:30,674
Like, my initial horror around it was when I tried to do IBD, which

396
00:20:30,674 --> 00:20:33,764
is, you know, the initial block download process for any new node.

397
00:20:34,399 --> 00:20:39,429
Like, we want people to run nodes, we want a decentralized protocol, which,

398
00:20:39,499 --> 00:20:45,219
like, for the language analogy, it's every node is a speaker of that language,

399
00:20:45,219 --> 00:20:49,009
and the language is centralized unless enough people speak it, and then you

400
00:20:49,009 --> 00:20:50,879
can have reliable, unchangeable rules.

401
00:20:51,119 --> 00:20:52,259
So what is Bitcoin?

402
00:20:52,289 --> 00:20:56,329
Like, it's rules that hopefully can't be changed in an unriggable game.

403
00:20:56,899 --> 00:20:59,829
Because there's nothing worse than playing a game where someone keeps changing the

404
00:20:59,829 --> 00:21:01,589
rules every time you start to do well.

405
00:21:01,739 --> 00:21:02,969
That's what inflation is.

406
00:21:02,989 --> 00:21:07,599
It's, hey, I worked hard, I saved money to do this thing, and it didn't work.

407
00:21:07,649 --> 00:21:10,229
Because someone printed a bunch more money, and now I don't

408
00:21:10,239 --> 00:21:11,619
have the thing I worked for.

409
00:21:11,619 --> 00:21:12,829
That's like, I rolled a six.

410
00:21:13,114 --> 00:21:16,234
And they went, well, that's actually, you move backwards instead of forwards, like,

411
00:21:16,244 --> 00:21:20,654
on the, it's like, this is so annoying, and it makes you disillusioned and short

412
00:21:20,654 --> 00:21:25,124
term preference and all that, so, wow, that was a tangent, you're asking me,

413
00:21:25,124 --> 00:21:29,854
like, what the implications of the, like, you need the nodes, nodes are what makes

414
00:21:29,854 --> 00:21:35,249
Bitcoin not a shitcoin, I've, like, I've been asking people this, like, Very open

415
00:21:35,249 --> 00:21:39,279
ended question, like, in the space, like, why, what, why is Bitcoin not a shitcoin?

416
00:21:40,179 --> 00:21:41,919
Like, what's your reason for that?

417
00:21:41,939 --> 00:21:44,939
And that's a very good question, it's a very provocative question.

418
00:21:45,259 --> 00:21:46,989
Because that's what we have to ask ourselves.

419
00:21:46,989 --> 00:21:49,429
Why do we get to have maximalism?

420
00:21:49,439 --> 00:21:51,859
Why do we get to have a superiority complex?

421
00:21:52,379 --> 00:21:53,979
How do we justify that?

422
00:21:54,369 --> 00:21:56,629
And, you know, people give different answers.

423
00:21:56,999 --> 00:21:58,929
Immaculate conception is one.

424
00:21:59,389 --> 00:22:05,149
Um, culture is another, um, but, to me, it's nodes.

425
00:22:05,579 --> 00:22:09,919
Like, in, there is not a shitcoin in the world where they do more than do some

426
00:22:09,919 --> 00:22:12,269
sort of dismissive gesture towards nodes.

427
00:22:12,509 --> 00:22:16,119
Like, Solana's my favorite, because it costs literally six figures worth of

428
00:22:16,169 --> 00:22:18,089
equipment to be able to run a node there.

429
00:22:18,279 --> 00:22:21,099
So they're saying, this is not important to what we do.

430
00:22:21,249 --> 00:22:23,769
Like, we don't need you running your fucking node.

431
00:22:23,769 --> 00:22:28,369
Craig Wright said the same, like, fuck off with your node, unless you've got 20, 000.

432
00:22:28,509 --> 00:22:33,259
I'm not trying to cater my, my protocol towards you guys.

433
00:22:33,779 --> 00:22:37,199
Bitcoin, Luke, people like those were the champions of node running.

434
00:22:37,349 --> 00:22:40,049
They're saying node running, everything is downstream from the nodes.

435
00:22:40,049 --> 00:22:44,259
If you ever forget that hierarchy, then you can't, Bitcoin cannot

436
00:22:44,259 --> 00:22:45,279
be controlled by miners.

437
00:22:45,309 --> 00:22:46,149
It just can't.

438
00:22:46,159 --> 00:22:47,939
They have to be employees of the network.

439
00:22:47,979 --> 00:22:49,969
They cannot be dictators of the protocol.

440
00:22:50,409 --> 00:22:53,079
There cannot be that case because if they ever get put in that position,

441
00:22:53,389 --> 00:22:56,269
then it's just, you know, Obama putting a medal on his own neck.

442
00:22:56,539 --> 00:23:00,132
When that becomes, when that becomes the system of checks and balances,

443
00:23:00,132 --> 00:23:02,959
then Bitcoin is a centralized shitcoin.

444
00:23:03,159 --> 00:23:05,029
Like, by definition, that's what it is.

445
00:23:05,094 --> 00:23:09,464
and that's, that's why I think the block size wars were such a pivotal

446
00:23:09,474 --> 00:23:13,634
moment and were like, where, where my conviction was ironclad was during that

447
00:23:13,634 --> 00:23:17,554
moment, because it's like, this is sort of a proof that we were actually in

448
00:23:17,554 --> 00:23:19,454
charge, the users, the node runners.

449
00:23:20,079 --> 00:23:25,819
But, but, yeah, if that isn't the case anymore, so, I mean, how, how,

450
00:23:26,679 --> 00:23:30,279
how, what's the, how big is this risk?

451
00:23:30,349 --> 00:23:32,469
Like, will we, will we win?

452
00:23:32,629 --> 00:23:35,469
Like, in your mind, like, what, what would it take for

453
00:23:35,469 --> 00:23:37,759
Bitcoin to survive this attack?

454
00:23:38,399 --> 00:23:41,624
Uh, because, uh, Yeah, another point there.

455
00:23:41,724 --> 00:23:47,874
Uh, if Bitcoin is allowed to be something else than money, then, then

456
00:23:47,874 --> 00:23:49,684
the incentive structure doesn't work.

457
00:23:49,684 --> 00:23:49,954
Right.

458
00:23:49,954 --> 00:23:51,024
This is like, yeah.

459
00:23:51,224 --> 00:23:56,844
So, so, so, and it right now it's being used for, for a ton of other shit.

460
00:23:57,294 --> 00:24:02,514
And it's just like how gold is not as good a money because it, because it is

461
00:24:02,514 --> 00:24:05,174
used as jewelry and like this Hayekian

462
00:24:05,839 --> 00:24:06,509
Yeah, right.

463
00:24:06,614 --> 00:24:08,754
much of a, how big is this risk?

464
00:24:08,774 --> 00:24:14,529
Like how, how, How endangered is Bitcoin by this, by this attack

465
00:24:14,529 --> 00:24:17,389
from this, uh, absolute scammers?

466
00:24:17,619 --> 00:24:19,689
Um, it remains to be seen.

467
00:24:19,889 --> 00:24:25,599
It's like, to round off the, what I should have said for your previous question, the,

468
00:24:25,609 --> 00:24:31,699
the attack, the Treating, increasing the scope of what a node does, which is run

469
00:24:31,699 --> 00:24:37,039
a very low resource requiring computer to verify the entire financial history

470
00:24:37,039 --> 00:24:42,369
of this network, plus a few op returns here and there, if you like, from weirdos

471
00:24:42,379 --> 00:24:49,269
that want to do stuff in it, and, um, and for your own benefit, UTXO set in an

472
00:24:49,289 --> 00:24:54,969
unscammable way of accepting money from anyone you've never met of any amount.

473
00:24:55,329 --> 00:25:00,119
You know, for 600 gigabytes on a one terabyte solid state drive or whatever

474
00:25:00,119 --> 00:25:03,879
that costs you a hundred bucks on a, you know, a, an a hundred dollar little

475
00:25:04,049 --> 00:25:06,059
single board computer like a Raspberry Pi.

476
00:25:06,599 --> 00:25:10,159
You know, that you manage to sync up to the network in two or three days.

477
00:25:10,459 --> 00:25:13,859
All of that to me is like, alright, that's kind of become the standard.

478
00:25:14,529 --> 00:25:18,809
And that was the Raspberry Pi 4, which was like the majority of nodes

479
00:25:18,809 --> 00:25:21,699
on the network because of these projects like Umbrella and Start9.

480
00:25:22,209 --> 00:25:25,959
And, fantastic, that was good, it was doing a lot, and a lot of it

481
00:25:25,959 --> 00:25:29,289
doesn't even show up in the stats that people show because it's all Tor.

482
00:25:29,759 --> 00:25:33,569
And, you know, so it, like the things like 21nodes.

483
00:25:33,619 --> 00:25:35,719
com or whatever, they won't even see all those nodes.

484
00:25:36,034 --> 00:25:40,024
So Luke, again, runs a much better service that shows there's around,

485
00:25:40,254 --> 00:25:43,344
I don't know, it's like 60, 70, 000 nodes on the network at the moment.

486
00:25:43,614 --> 00:25:45,414
That's credibly decentralized, it's good.

487
00:25:45,734 --> 00:25:50,234
But what they're not, what they did not sign up for was to become redundant cloud

488
00:25:50,234 --> 00:25:54,624
storage for people like Michael Saylor that have a great idea about another

489
00:25:54,624 --> 00:25:56,624
thing we can do with Bitcoin's blockchain.

490
00:25:56,624 --> 00:26:00,904
Like, you're abusing that resource, which is an unpaid resource.

491
00:26:01,284 --> 00:26:06,324
That is just, you know, it's just like if you could magically say like I have

492
00:26:06,324 --> 00:26:10,704
this like appreciate English for a minute It allows us all to communicate

493
00:26:10,914 --> 00:26:14,944
like if you're if you're Austrian and you're meeting a Russian or something

494
00:26:15,274 --> 00:26:18,704
English is probably going to be really useful because it's a common thing

495
00:26:18,704 --> 00:26:23,899
that you probably both have now imagine if Like, the, the, the resources that

496
00:26:23,899 --> 00:26:28,579
went into learning English as a child, or, you know, that happened, that we

497
00:26:28,729 --> 00:26:32,179
gratefully, was useful to enough people that they did it of their own volition.

498
00:26:32,359 --> 00:26:36,079
Foreigners that learned to speak English, they did this thing for their own

499
00:26:36,079 --> 00:26:40,859
benefit, and as a result, we all get English, and it's fucking useful, we can

500
00:26:40,859 --> 00:26:44,679
communicate, and it's great, and there's little attacks on languages around.

501
00:26:44,974 --> 00:26:47,954
You know, woke ideologies that try to redefine words and stuff

502
00:26:47,954 --> 00:26:50,484
like that, and we still laugh at them and dismiss what they do.

503
00:26:50,844 --> 00:26:52,684
We still know men don't get periods.

504
00:26:52,724 --> 00:26:55,244
All that stuff, because it's decentralized enough.

505
00:26:55,544 --> 00:26:58,744
This is so useful as a fantastic, wonderful tool.

506
00:26:59,094 --> 00:27:05,259
But imagine You found a hole in the, in, if the medium through which English

507
00:27:05,259 --> 00:27:09,299
travelled, obviously it doesn't work like that, and you went, I can hijack

508
00:27:09,359 --> 00:27:13,139
every one of those people that's got that set of rules in their brain,

509
00:27:13,209 --> 00:27:17,229
all those English speakers, and I can force them To start storing irrelevant

510
00:27:17,229 --> 00:27:21,699
crap and increasing the overhead of what it takes to learn English so a

511
00:27:21,699 --> 00:27:23,469
three year old can't learn it anymore.

512
00:27:23,534 --> 00:27:25,874
you need to learn Esperanto as well, like,

513
00:27:25,969 --> 00:27:27,219
You're tacking it on.

514
00:27:27,229 --> 00:27:30,049
You're increasing the scope of what all these, like, no one

515
00:27:30,049 --> 00:27:31,919
is being paid to learn English.

516
00:27:32,069 --> 00:27:36,209
Like, they are doing it for their own good and you're saying I'm going to abuse

517
00:27:36,209 --> 00:27:39,989
the fact that you want to do it for your own good by making you have to do more.

518
00:27:40,329 --> 00:27:46,009
That's such a fucking sociopathic thing to do, it's so undermining to it,

519
00:27:46,009 --> 00:27:49,519
because you'll just get more and more people saying, I can't speak English,

520
00:27:49,819 --> 00:27:53,219
I'm just gonna, like, rely on Google Translate to do it all, and I've got AI

521
00:27:53,619 --> 00:27:57,509
to do it, and then, great, now there's OpenAI, and a couple of other things.

522
00:27:57,639 --> 00:28:00,609
Companies that are the gatekeepers of all human communication.

523
00:28:00,799 --> 00:28:02,359
That's what happens with Bitcoin.

524
00:28:02,519 --> 00:28:06,399
No one can run nodes anymore So we all need permission to use the network.

525
00:28:06,479 --> 00:28:08,079
That's the way you trend with

526
00:28:08,364 --> 00:28:12,864
So, so, so, back to Sailor and this idea of,

527
00:28:13,029 --> 00:28:13,729
did scheme.

528
00:28:14,684 --> 00:28:18,314
So, yeah, the digital idea, whatever.

529
00:28:19,024 --> 00:28:24,484
Uh, it's like Michael, uh, Michael Saylor as well, like everyone

530
00:28:24,484 --> 00:28:25,574
has a learning curve, right?

531
00:28:25,604 --> 00:28:27,864
And he has not been in the space for very long.

532
00:28:27,894 --> 00:28:31,454
I mean, he's, he's got some great perspectives on it and

533
00:28:31,454 --> 00:28:35,464
whatnot, but couldn't this just be like, I mean, nobody's perfect.

534
00:28:35,494 --> 00:28:37,074
Couldn't this just be a flow in?

535
00:28:37,449 --> 00:28:41,209
The understanding is anyone talking to him about this stuff?

536
00:28:41,629 --> 00:28:44,879
Or does he get the wrong information because it's

537
00:28:45,189 --> 00:28:46,389
connected to the wrong people?

538
00:28:46,389 --> 00:28:50,739
Why, why isn't anyone like, uh, anti spam pilling him

539
00:28:51,887 --> 00:28:53,437
There's, there's two ways with this.

540
00:28:53,467 --> 00:28:56,607
Like, I was sort of hit with an idea today about it that I hadn't thought of before.

541
00:28:56,607 --> 00:29:02,482
It can be 5D Chess, because his explicit position is Stop fucking

542
00:29:02,482 --> 00:29:06,642
around with my money, stop with the opcodes, stop funding core developers

543
00:29:06,642 --> 00:29:10,582
altogether, and, like, I agree with him far more than most with this.

544
00:29:10,622 --> 00:29:12,662
I think there's deep wisdom in that.

545
00:29:12,992 --> 00:29:16,282
Stop, and I said it on stage earlier at this conference, like, I was

546
00:29:16,282 --> 00:29:19,702
the biggest proponent of SegWit and Taproot, and I was, like, a big part

547
00:29:19,702 --> 00:29:23,987
of pushing these in every way I could, like, However, how helpful I was, I

548
00:29:23,997 --> 00:29:27,717
don't know, but I was very enthusiastic about it, and shit happened as a

549
00:29:27,717 --> 00:29:29,527
result of them that I did not expect.

550
00:29:29,787 --> 00:29:33,177
And I took, I'm eating a humble pill from that, saying, I

551
00:29:33,197 --> 00:29:34,647
don't fucking know everything.

552
00:29:34,657 --> 00:29:38,067
Like, I will argue at B caches all day about how good Segwit is and all that,

553
00:29:38,267 --> 00:29:42,777
and I don't regret that they happened, but some shit happened that I wish hadn't

554
00:29:42,777 --> 00:29:46,737
happened, and Saylor is basically just having the wisdom to say, I don't care

555
00:29:46,747 --> 00:29:52,622
how solid you think OpCat is, or OpCTV is, Something is going to happen as a

556
00:29:52,622 --> 00:29:56,312
result of these things that you didn't account for and the bigger Bitcoin

557
00:29:56,322 --> 00:29:58,592
gets, the harder it is for us to fix it.

558
00:29:59,072 --> 00:30:04,092
So, I was saying, I wanted to, to posit to Selah, you have an

559
00:30:04,092 --> 00:30:05,782
exactly correct position there.

560
00:30:05,842 --> 00:30:10,182
It's reeks of wisdom and it's something that the intelligent people in the space,

561
00:30:10,182 --> 00:30:15,392
but the naive young developer breed of people that are very intelligent,

562
00:30:15,402 --> 00:30:19,707
like damagingly intelligent, but not very wise yet, Won't be aware

563
00:30:19,952 --> 00:30:22,442
No, it's a move fast and break things mentality, right?

564
00:30:22,457 --> 00:30:26,757
but the, the best example we have of an unintended consequence of

565
00:30:26,767 --> 00:30:30,187
an otherwise good soft fork is what's going on with the spam.

566
00:30:30,687 --> 00:30:33,887
And Saylor is saying, all right, I'm going to engage in the spam.

567
00:30:33,927 --> 00:30:34,817
That's what he's doing.

568
00:30:34,827 --> 00:30:39,187
He's using, he's not using OpReturn, he's using the grossest hack possible

569
00:30:39,207 --> 00:30:44,337
to trick nodes into How into storing transactions that are, you know, they're

570
00:30:44,337 --> 00:30:48,357
fake transactions that are tricking nodes into believing something is a

571
00:30:48,357 --> 00:30:51,367
script that isn't a script, that's really just a bunch of arbitrary

572
00:30:51,802 --> 00:30:56,652
we say he's doing it, we really mean that this is a potential, it's like a

573
00:30:56,662 --> 00:30:59,452
suggested thing from MicroStrategy, right?

574
00:30:59,457 --> 00:31:02,487
I don't, I don't know where they are in the process of

575
00:31:02,487 --> 00:31:03,777
it, but they've laid it out.

576
00:31:03,777 --> 00:31:06,747
They've said the mechanism by which they're going to add data into the

577
00:31:06,747 --> 00:31:08,637
chain, like, and it's not op return.

578
00:31:08,637 --> 00:31:11,917
This is what I asked him and he said, I don't know the mechanism.

579
00:31:11,917 --> 00:31:14,927
And then they published it and it's like, wow, this is the mechanism.

580
00:31:14,952 --> 00:31:17,282
This was the conversation that the three of us happened

581
00:31:17,282 --> 00:31:19,572
to fall into on the Madeira.

582
00:31:19,572 --> 00:31:20,502
Actually, we remember that.

583
00:31:20,502 --> 00:31:22,602
But, uh, uh, can you quickly

584
00:31:22,932 --> 00:31:23,502
we were all

585
00:31:23,822 --> 00:31:24,292
Yeah, yeah.

586
00:31:24,452 --> 00:31:25,122
Exactly

587
00:31:25,352 --> 00:31:29,892
I've spoken to Saylor many times, but I never get more than 15 seconds, because

588
00:31:29,902 --> 00:31:33,222
someone always comes along and shakes hands and talks about what a genius he is.

589
00:31:33,402 --> 00:31:37,012
And I love Saylor, I think he is a genius, but, like, you're

590
00:31:37,012 --> 00:31:38,502
asking about the psychology here?

591
00:31:38,962 --> 00:31:42,382
If it's 5D chess, it's him saying, you want to keep doing upgrades?

592
00:31:42,512 --> 00:31:45,122
Well, when there's problems with them, people like me will come

593
00:31:45,122 --> 00:31:47,822
along and exploit those problems and there's nothing you can do about it.

594
00:31:47,952 --> 00:31:53,467
So he is simultaneously A complete hypocrite for saying, don't fuck with

595
00:31:53,467 --> 00:31:57,317
perfect money, and by the way, I'm using this new thing that's only possible

596
00:31:57,327 --> 00:32:00,267
because someone fucked with perfect money that undermines everything.

597
00:32:00,617 --> 00:32:04,697
Uh, or he's just, like, like, that's completely hypocritical,

598
00:32:04,707 --> 00:32:08,757
or he's just saying, I told you, like, I don't know which it is.

599
00:32:09,067 --> 00:32:09,447
But he's

600
00:32:09,662 --> 00:32:12,932
if you're watching, like, have a conversation with these guys.

601
00:32:12,957 --> 00:32:15,557
I've asked, I've reached out to him before to talk, I've never

602
00:32:15,557 --> 00:32:18,347
managed to get, like, any kind of response or anything like that.

603
00:32:18,837 --> 00:32:23,157
Busy guy, you know, I don't question his motivation and commitment, like, I really

604
00:32:23,157 --> 00:32:25,537
think he's a sincere and good advocate.

605
00:32:25,937 --> 00:32:28,467
Like, the only thing I take issue with is when he's telling people to

606
00:32:28,467 --> 00:32:34,097
mortgage their house to buy bitcoin, and like, dude, do not buy Like, we don't

607
00:32:34,097 --> 00:32:35,967
have 0 percent interest like you do.

608
00:32:36,282 --> 00:32:39,932
Well, the rest of us have, like, like, this is credit card debt you're

609
00:32:39,932 --> 00:32:43,852
getting people into to pump banks, like, this is really irresponsible.

610
00:32:43,922 --> 00:32:47,822
Like, I don't know why he hasn't said, yeah, that was maybe not good.

611
00:32:47,842 --> 00:32:50,292
Like, his, his, he borrows money at 0%, right?

612
00:32:50,582 --> 00:32:56,167
So, sure, buy 21 million bitcoins at 0 percent interest, like, No brainer, right?

613
00:32:56,167 --> 00:32:58,657
But your average pleb needs to not do that.

614
00:32:58,667 --> 00:33:03,377
Like, they need to just earn and stack what they can and do their UTXO

615
00:33:03,377 --> 00:33:08,107
management and like, don't be, don't be borrowing money to buy Bitcoin ever,

616
00:33:08,257 --> 00:33:11,697
because then you have to sell it at some point to repay the loan and you'll

617
00:33:11,697 --> 00:33:14,207
probably have to do that at a loss.

618
00:33:14,557 --> 00:33:18,907
Like, even if you, 50 50 chance of Like, of being right or wrong with

619
00:33:18,907 --> 00:33:23,717
the market, plus the interest on the loan means you, you're, you're down.

620
00:33:23,757 --> 00:33:26,707
Most of the, you have a greater chance of losing than winning.

621
00:33:26,797 --> 00:33:27,227
Sorry.

622
00:33:27,618 --> 00:33:28,008
here.

623
00:33:28,278 --> 00:33:29,138
I just want to.

624
00:33:29,338 --> 00:33:32,748
So, I mean, everything in terms of sailors, specifically some,

625
00:33:32,788 --> 00:33:37,058
some good points, but I think just for the sake of, uh, Explaining

626
00:33:37,058 --> 00:33:42,038
what the difference is between Operturn and the new types of spam.

627
00:33:42,038 --> 00:33:46,068
Can you do just a little TLDR on Operturn versus what all

628
00:33:46,258 --> 00:33:47,418
the new types of things are?

629
00:33:47,458 --> 00:33:48,958
Because there's a few of them, right?

630
00:33:49,143 --> 00:33:55,283
So, OpReturn is, uh, was done as a compromise to try and, uh, make it so that

631
00:33:55,813 --> 00:34:01,103
there was a, the least resource intensive, or, you know, the least expensive to the

632
00:34:01,103 --> 00:34:03,683
network method of storing arbitrary data.

633
00:34:04,278 --> 00:34:08,418
Um, it doesn't bloat the UTXO set like other methods.

634
00:34:08,628 --> 00:34:11,388
Um, and everything in it, it's provably printable.

635
00:34:11,388 --> 00:34:14,748
So even if you send SATs to an opera return output, which you don't have to

636
00:34:14,748 --> 00:34:17,118
do, those SATs are never spendable again.

637
00:34:17,118 --> 00:34:18,888
So as a node you don't need to care about it.

638
00:34:18,918 --> 00:34:22,098
You can make an opera turn of one Bitcoin if you like, and the

639
00:34:22,158 --> 00:34:25,398
every node can discard it 'cause that Bitcoin can never be spent.

640
00:34:25,618 --> 00:34:30,398
So, that's, that's not true of other things like fake public keys, right,

641
00:34:30,398 --> 00:34:34,198
which isn't, which was a thing people were doing before OpReturn, where,

642
00:34:34,238 --> 00:34:38,268
even though those are also unspendable, your node has to do a bunch of

643
00:34:38,458 --> 00:34:42,878
calculation to verify that those public keys are genuinely not true or not.

644
00:34:43,348 --> 00:34:49,128
Um, and like, you know, as a, I think it's roughly 50 percent of, Out of

645
00:34:49,128 --> 00:34:52,098
the total space of public keys you can generate, 50 percent of them are

646
00:34:52,098 --> 00:34:53,908
spendable and 50 percent of them aren't.

647
00:34:54,108 --> 00:34:55,798
And you don't know that trivially.

648
00:34:55,818 --> 00:35:00,708
So, you can, you've seen that like one bitcoin ETA address don't send

649
00:35:01,068 --> 00:35:02,808
address that people use as an example.

650
00:35:02,818 --> 00:35:05,408
You can send bitcoins to that, you can't spend from that,

651
00:35:05,408 --> 00:35:07,098
it's not a valid public key.

652
00:35:07,418 --> 00:35:10,538
But, your node will treat them as the same because it's too

653
00:35:10,538 --> 00:35:12,768
computationally expensive to verify.

654
00:35:13,228 --> 00:35:19,278
Outputs, like we can soft fork to an address type, which you, in which

655
00:35:19,508 --> 00:35:21,688
transactions are only valid in blocks.

656
00:35:21,768 --> 00:35:25,468
If the node runs some calculations and says, yes, all these outputs are to

657
00:35:25,468 --> 00:35:27,148
valid addresses that are spendable.

658
00:35:27,568 --> 00:35:31,468
There's a computational cost to that, but it's not actually that undoable.

659
00:35:31,478 --> 00:35:34,468
And this is like a controversial thing I probably shouldn't get into.

660
00:35:34,468 --> 00:35:37,848
But if the assumption was that's not possible.

661
00:35:38,068 --> 00:35:42,618
So to stop people using freaking fake public keys.

662
00:35:43,173 --> 00:35:46,563
Uh, we're gonna create something which is provably the same thing

663
00:35:46,563 --> 00:35:50,113
as a fake public key that can't be a real, like, spendable output.

664
00:35:50,133 --> 00:35:51,303
That's what OpReturn is.

665
00:35:51,703 --> 00:35:54,463
And it was a good compromise for a while.

666
00:35:54,873 --> 00:35:56,133
I don't think it lasted.

667
00:35:56,153 --> 00:36:00,353
And unfortunately, the witness discount that came with SegWit meant they found a

668
00:36:00,353 --> 00:36:05,753
way to do, like, OpReturn was, you weren't seeing any bigger than 83 bytes because

669
00:36:05,753 --> 00:36:07,713
that was the default on Bitcoin Core.

670
00:36:08,223 --> 00:36:11,703
And they weren't getting any kind of discount versus real transactions.

671
00:36:12,053 --> 00:36:16,753
So Segwit and Taproot come along and suddenly you have the 83 byte limit

672
00:36:16,753 --> 00:36:22,013
doesn't apply to the bug they found a way to exploit and it gets to take

673
00:36:22,013 --> 00:36:23,473
advantage of the witness discount too.

674
00:36:24,313 --> 00:36:24,833
So,

675
00:36:24,978 --> 00:36:27,538
the basics of the bug that's being exploited?

676
00:36:28,083 --> 00:36:30,923
um, you're, you're creating something that looks like a script.

677
00:36:31,233 --> 00:36:36,773
But you're using, like, in, you know, you have if, if conditions, right, where in,

678
00:36:36,973 --> 00:36:43,213
you know, if, if this, then that, like, and you're creating, uh, uh, what are

679
00:36:43,243 --> 00:36:48,603
the, they're putting the, the false opcode before the op if, and so the op false

680
00:36:48,603 --> 00:36:51,783
says, ignore the following chunk of, if.

681
00:36:52,203 --> 00:36:55,773
The following chunk of code can never execute, and then there's an if condition

682
00:36:55,993 --> 00:36:59,873
that is, will never be, you know, called.

683
00:36:59,903 --> 00:37:02,483
I don't even, or, I don't know the right thing, right?

684
00:37:02,823 --> 00:37:05,703
Um, and that contains a bunch of arbitrary data.

685
00:37:06,033 --> 00:37:10,743
And your bitcoin node doesn't mind that it's there, or that it's invalid as a

686
00:37:10,743 --> 00:37:14,273
script, or doesn't make any sense, because the false has told it to ignore it all.

687
00:37:14,443 --> 00:37:19,688
But it's, it's It's deliberately hacking its way into a script and like

688
00:37:19,688 --> 00:37:25,588
it's it's just saying like It's like I want to I want you to I want to blab

689
00:37:25,588 --> 00:37:28,088
a bunch of crap at you that you've never heard So I come to you and say

690
00:37:28,088 --> 00:37:31,118
hey I got something interesting to tell you blah blah blah blah blah and

691
00:37:31,118 --> 00:37:34,058
I force you to stand there and listen to it and absorb It all and then go.

692
00:37:34,098 --> 00:37:34,968
That happens once.

693
00:37:35,028 --> 00:37:35,368
mind.

694
00:37:35,378 --> 00:37:38,438
Actually, I didn't have anything to say and then you walk off Do you know what?

695
00:37:38,438 --> 00:37:38,848
I mean?

696
00:37:39,008 --> 00:37:43,128
It's it's like you're forcing someone to listen to something that is irrelevant.

697
00:37:43,253 --> 00:37:46,753
like when there's a Q& A section and someone says, yeah, I have a question.

698
00:37:46,793 --> 00:37:47,953
And then it's not a question.

699
00:37:47,953 --> 00:37:49,023
It's a rant for 20

700
00:37:49,208 --> 00:37:54,528
Yeah, right, it's, and, but, the structure of what it is, and the sort of social norm

701
00:37:54,528 --> 00:37:58,148
of that context, where someone's asking a question, forces you to listen to it,

702
00:37:58,313 --> 00:37:58,873
yeah, yeah.

703
00:37:58,878 --> 00:38:00,128
It's like a hack of that

704
00:38:00,433 --> 00:38:03,383
it the case that and like ad rant,

705
00:38:03,608 --> 00:38:08,308
Yeah, it's, it's a, it's just, it's, uh, it's data injection, like, this

706
00:38:08,308 --> 00:38:12,458
is, as Jason put it, this is Computer Science 101, you're putting data

707
00:38:12,958 --> 00:38:16,713
in a way that's not, uh, Accepted by the, you know, the thing.

708
00:38:16,713 --> 00:38:21,073
It's like if you're typing in code into the login field on a website

709
00:38:21,293 --> 00:38:24,463
that doesn't have like, what do they call it, sanitized inputs.

710
00:38:24,483 --> 00:38:28,363
Like, there's a, and if you ever, like, tried to, like, create a

711
00:38:28,363 --> 00:38:32,303
username or account with, like, with, like, database language and stuff in

712
00:38:32,303 --> 00:38:35,113
it to try and, like, make Facebook dump all their users and stuff.

713
00:38:35,323 --> 00:38:37,873
Like, you can try and do that, but they, they prevent you from doing

714
00:38:37,873 --> 00:38:39,283
it because that's data injection.

715
00:38:39,293 --> 00:38:39,833
Like,

716
00:38:40,003 --> 00:38:40,473
even easier.

717
00:38:40,473 --> 00:38:45,083
It's like when you put the web address in the search bar instead of the address

718
00:38:45,248 --> 00:38:45,688
Yeah,

719
00:38:46,093 --> 00:38:48,813
even that, like, it's like my mother using the computer.

720
00:38:49,128 --> 00:38:53,748
Yeah, but I mean, it's just an, like, something about doing that.

721
00:38:54,448 --> 00:39:00,158
It's, to me, it's just like, I used this bus analogy before, and it's a

722
00:39:00,158 --> 00:39:02,508
good analogy, and I do stick to it.

723
00:39:02,518 --> 00:39:07,338
It's like, you design a city, and people are just about getting around

724
00:39:07,338 --> 00:39:11,238
it, and there's a bus service, and then FedEx figures out they can put packages

725
00:39:11,238 --> 00:39:14,658
on the bus, and do that cheaper than getting their own vans and all that.

726
00:39:15,118 --> 00:39:18,328
And, you know, you have the idiots that are like, So what?

727
00:39:18,348 --> 00:39:21,388
Who gets to define what a package is versus a human being?

728
00:39:21,388 --> 00:39:24,808
Like, I have a backpack, are you gonna not let me on the bus as part of your new

729
00:39:24,818 --> 00:39:26,788
censorship thing to not let FedEx use it?

730
00:39:27,178 --> 00:39:30,378
I'm like, but, look guys, no one can make it around the city anymore,

731
00:39:30,398 --> 00:39:32,908
cause FedEx have all this money and they're using a bus service

732
00:39:32,908 --> 00:39:33,938
for something that wasn't designed.

733
00:39:34,198 --> 00:39:36,828
But now you have, like, Michael Saylor.

734
00:39:37,358 --> 00:39:41,278
You've got a cardboard box that you've, like, put this scarecrow thing

735
00:39:41,278 --> 00:39:43,478
around to make it look like a human.

736
00:39:43,788 --> 00:39:47,908
To, to sneak it onto the bus, to trick the bus driver that this thing

737
00:39:47,908 --> 00:39:52,758
really is a human, like, ask yourself why you have to paint this picture,

738
00:39:52,768 --> 00:39:54,388
why are you playing this charade?

739
00:39:54,598 --> 00:39:58,828
It's because the intentions of everyone involved in this wants this

740
00:39:58,858 --> 00:40:01,278
to be a bus service, not a courier.

741
00:40:01,563 --> 00:40:05,513
Like, the fact that you have to disguise your actions and hack stuff

742
00:40:05,513 --> 00:40:09,043
and trick nodes should tell you that you're doing something untoward.

743
00:40:09,413 --> 00:40:13,883
If, if Bitcoin was all about being a, a store, an arbitrary data storage

744
00:40:13,893 --> 00:40:17,823
mechanism for like all these wild ideas we can do, like decentralized identity

745
00:40:17,823 --> 00:40:22,003
and all that, it would be, you wouldn't have to hack it, you would just do it.

746
00:40:22,063 --> 00:40:24,533
Like, nodes would just accept it on the off.

747
00:40:24,783 --> 00:40:28,703
The fact that you have to like, trick it, It should betray to you the fact

748
00:40:28,703 --> 00:40:33,233
that you're, you're using a, a tool that doesn't want to be used for that job.

749
00:40:33,413 --> 00:40:36,443
And it's like, on the one hand you can go, wow, what a cipher punk you are

750
00:40:36,443 --> 00:40:38,183
for figuring out how to hack a system.

751
00:40:38,363 --> 00:40:40,583
On the other hand, you can just go, this is unethical.

752
00:40:40,963 --> 00:40:44,803
Like, it's like it's, this is designed for a purpose and you're not using it

753
00:40:44,803 --> 00:40:47,473
for that, and there's a reason for this.

754
00:41:47,255 --> 00:41:51,865
Okay, okay, like, uh, so, so, there's this narrative that, like, Bitcoin

755
00:41:52,285 --> 00:41:55,395
thrives in an adversarial environment and Bitcoin is for enemies and

756
00:41:55,435 --> 00:41:59,135
It does if it's community is prepared to acknowledge that it's under

757
00:41:59,135 --> 00:42:00,645
attack and actually fight back.

758
00:42:00,655 --> 00:42:02,795
If it's not, then it just collapses.

759
00:42:02,825 --> 00:42:07,155
Bitcoin cannot withstand it's own miners attacking it and thinking they're not.

760
00:42:07,365 --> 00:42:10,905
Bitcoin, no one survives a drug addiction problem where they

761
00:42:10,905 --> 00:42:12,225
start attacking their own body.

762
00:42:12,545 --> 00:42:15,175
Sure, like, I can attack you and you can get stronger as a result,

763
00:42:15,205 --> 00:42:19,325
but if you imagine the attack to be a good thing, and you totally open

764
00:42:19,325 --> 00:42:21,055
yourself up to it, then you're fucked.

765
00:42:21,260 --> 00:42:26,750
but my question is more like, if Bitcoin survives this attack, will

766
00:42:26,750 --> 00:42:30,740
it be better off, uh, than if this attack wouldn't have happened at all?

767
00:42:31,150 --> 00:42:35,590
Like, w is this less an in vigilance a good thing or a bad

768
00:42:35,660 --> 00:42:37,270
If we survive this, great.

769
00:42:37,340 --> 00:42:41,240
But the, uh, the reason I'm not optimistic is because we've already survived it.

770
00:42:41,240 --> 00:42:43,800
And some attacks keep repeating, right?

771
00:42:43,800 --> 00:42:46,830
Like, big blockers, they just keep, it's like a perennial,

772
00:42:46,830 --> 00:42:48,120
eternal September kind of thing.

773
00:42:48,500 --> 00:42:52,540
Like, you have big blockers from ages ago, we were all big blockers.

774
00:42:52,540 --> 00:42:55,620
And then you have, like, the New York agreement big blockers, and the Roger

775
00:42:55,620 --> 00:42:59,270
Ver big blockers, and the Bitmain big blockers, and now, now you even have the

776
00:42:59,270 --> 00:43:01,400
Andreas big blocker, and the, and the

777
00:43:01,410 --> 00:43:01,800
Yeah.

778
00:43:01,800 --> 00:43:02,130
Yeah.

779
00:43:02,130 --> 00:43:04,520
I heard that that was a surprise.

780
00:43:04,690 --> 00:43:08,120
know, it's, it's painfully naive for someone of his intelligence.

781
00:43:08,150 --> 00:43:10,580
Like, it's, I honestly can't believe

782
00:43:10,630 --> 00:43:11,260
No, it's, it is

783
00:43:11,380 --> 00:43:12,060
what I'm hearing here.

784
00:43:12,130 --> 00:43:15,370
the way I see it is like, let's, we didn't get the like.

785
00:43:15,885 --> 00:43:20,095
It's like the some of the early generation stuff like genius programmers

786
00:43:20,245 --> 00:43:23,895
not understanding the economics like like that There's there's a

787
00:43:23,910 --> 00:43:27,620
Well, they don't necessarily, like, just cause you're a fantastic developer doesn't

788
00:43:27,620 --> 00:43:29,320
mean you know anything about economics.

789
00:43:29,400 --> 00:43:30,410
And, like, you,

790
00:43:30,445 --> 00:43:32,355
No, it's such a confusing field to so

791
00:43:32,635 --> 00:43:36,335
Satoshi was like the perfect jack of all trades, because he understood enough

792
00:43:36,335 --> 00:43:40,395
about each field to design a system, like, it's not, if he'd have just been like a

793
00:43:40,395 --> 00:43:45,825
million times better at C and just not any good at, you know, economics, you

794
00:43:45,825 --> 00:43:49,715
wouldn't have Bitcoin, it's, you have the specialist, but I think to answer,

795
00:43:50,205 --> 00:43:54,465
what you just said is a really provoking question, because you have these like,

796
00:43:54,675 --> 00:43:58,735
perennial issues that keep coming up over and over again, and you have to fight them

797
00:43:59,255 --> 00:44:04,550
off every time, like, so, China banning Bitcoin is like a one off, where we've

798
00:44:04,550 --> 00:44:08,840
gone good luck with a nation state banning mining, that we'll lose, and I think

799
00:44:08,840 --> 00:44:11,650
that's one of those battles you fight once, and you've demonstrated you can

800
00:44:11,650 --> 00:44:15,840
succeed, and you recover, the difficulty adjusted like it was supposed to, all

801
00:44:15,840 --> 00:44:18,900
the miners in other countries just made twice as much Bitcoin suddenly, and it

802
00:44:18,935 --> 00:44:19,375
Mm hmm.

803
00:44:19,480 --> 00:44:22,850
we all laughed, and we all are happy, and I don't think it's gonna get tried again.

804
00:44:23,205 --> 00:44:27,595
Rogue developers, we've done that, we've done exchanges collapsing, these

805
00:44:27,595 --> 00:44:28,925
are things that will actually repeat.

806
00:44:29,135 --> 00:44:33,485
So when an ETF gets caught doing its Enron shit and it turns out, like, they've got

807
00:44:33,485 --> 00:44:37,415
no Bitcoin, and they've been selling fake Bitcoin on their balance sheet and all

808
00:44:37,415 --> 00:44:40,605
that, and even though they ticked all the boxes, this is gonna happen, right?

809
00:44:40,605 --> 00:44:44,235
One, one of these ETFs is going to not have the Bitcoin, it says it does.

810
00:44:44,255 --> 00:44:46,115
It's, it's a, it's an accident waiting to happen.

811
00:44:46,465 --> 00:44:47,385
That's gonna be Mt.

812
00:44:47,385 --> 00:44:48,385
Gox 2.

813
00:44:48,385 --> 00:44:48,705
0, right?

814
00:44:48,725 --> 00:44:50,295
FTX was already that, right?

815
00:44:50,295 --> 00:44:54,395
But, Like, these, these are inevitable, and unfortunately, those are battles

816
00:44:54,415 --> 00:44:58,515
that you have to keep winning over and over again, and that's like, that's like

817
00:44:58,535 --> 00:45:02,775
weeding in the garden, and if one day it becomes apparent that the weeders

818
00:45:02,835 --> 00:45:06,285
are not paying attention anymore, then within six months, you're overgrown

819
00:45:06,295 --> 00:45:09,595
with weeds, and that's what I think is happening with decentralization, and,

820
00:45:09,815 --> 00:45:14,295
and because we, to round to, um, I'm endeavoring to, like, make a point here

821
00:45:14,345 --> 00:45:19,605
when it comes to spam, we've fought spam and arbitrary data before, And we won.

822
00:45:19,755 --> 00:45:21,855
That's why opera turn is where it is.

823
00:45:21,915 --> 00:45:26,655
And that's why, that's why all of the shit Bitcoiners got the amp and went over

824
00:45:26,660 --> 00:45:31,695
to Ethereum because we won those battles and we told them like, yes, you can still

825
00:45:31,755 --> 00:45:33,615
put arbitrator in his fake public keys.

826
00:45:33,615 --> 00:45:36,375
And yes, you can use opera turn, but go away.

827
00:45:36,615 --> 00:45:40,125
And that that means you can't get, you can't raise money unless

828
00:45:40,125 --> 00:45:41,445
you tell the venture capitalist.

829
00:45:41,450 --> 00:45:43,935
Don't worry, we're doing it on Ethereum that actually wants us to do it.

830
00:45:44,115 --> 00:45:47,025
Like the minute, like you're, if you've got millions of dollars to invest.

831
00:45:47,335 --> 00:45:50,535
In, uh, something like the Taproot Wizards or whatever scam it is they're

832
00:45:50,575 --> 00:45:55,125
doing, and any venture any VC is gonna do their due diligence and go, you're

833
00:45:55,125 --> 00:45:58,585
doing it on Bitcoin, and as far as I can tell, these guys are hostile to it.

834
00:45:58,645 --> 00:46:01,765
They might fork to prevent you from doing what you're doing, and it's gonna

835
00:46:01,765 --> 00:46:05,845
take us months to raise the capital and build the thing, and gamify the

836
00:46:05,845 --> 00:46:08,625
whole attack to the point where it becomes an actual problem for Bitcoin.

837
00:46:09,280 --> 00:46:09,640
Right?

838
00:46:09,890 --> 00:46:14,130
If you want to take your spam to that level, where you have enough NFT idiots

839
00:46:14,190 --> 00:46:20,020
participating in and funding the attack, you need a relatively docile Bitcoin,

840
00:46:20,510 --> 00:46:24,150
and a community that's demonstrated it doesn't really care that much, like, this

841
00:46:24,150 --> 00:46:25,850
is why the spam is so easy to defeat.

842
00:46:26,225 --> 00:46:30,775
Because you, you just, when you have Vladimir Van der Laan and, you know, and,

843
00:46:31,165 --> 00:46:34,325
um, Jeff Garzik back in 2014 and Luke Jr.

844
00:46:34,325 --> 00:46:38,635
saying go away with Counterparty, do it somewhere else, like there's no soft

845
00:46:38,635 --> 00:46:42,535
fork, you don't need it, the developers go alright, well I'm not going to spend the

846
00:46:42,535 --> 00:46:46,615
next six months writing a bunch of code for like an arbitrary data thing that,

847
00:46:46,685 --> 00:46:51,685
on Bitcoin, that no one, that, Gets like shunned by the thing and it's not worth

848
00:46:51,685 --> 00:46:56,685
my time Like now because we're ambivalent and we're flaccid enough as a community

849
00:46:56,925 --> 00:47:01,685
it got to escape Velocity and rather than be the odd op return here and there it's

850
00:47:01,685 --> 00:47:06,175
become like a massive systemic issue Like and you can root that out if you want,

851
00:47:06,485 --> 00:47:11,335
but after a point of no return, it's like the garden with the inevitable weeds has

852
00:47:11,335 --> 00:47:15,675
now turned into an absolute jungle and I can't really do anything about it anymore

853
00:47:15,675 --> 00:47:21,305
in fact we've kind of lost this you know so it's you have to keep arbitrary data

854
00:47:21,305 --> 00:47:28,895
in bitcoin spam mitigation in any protocol always requires active participation

855
00:47:29,155 --> 00:47:31,755
and ongoing cat and mouse ish

856
00:47:32,095 --> 00:47:35,895
So I love how you say that you were humbled by by

857
00:47:36,505 --> 00:47:37,588
segwit and

858
00:47:37,675 --> 00:47:41,865
Yeah, yeah, and that there were these unforeseen consequences that you

859
00:47:42,155 --> 00:47:47,535
saw them later down the line, and I echo that with like, the view I

860
00:47:47,545 --> 00:47:52,715
used to have of us winning the block size wars, us, I say us for lack of

861
00:47:52,715 --> 00:47:54,925
a better word, but like, you know,

862
00:47:55,735 --> 00:47:57,215
don't have this same yeah

863
00:47:57,245 --> 00:48:02,615
Yeah, it's like, it's like, this is proof that the users are in charge of

864
00:48:02,830 --> 00:48:03,320
Mm

865
00:48:03,670 --> 00:48:08,490
But actually, like, in hindsight, my, my, how I see it now is like, it's

866
00:48:08,510 --> 00:48:10,870
proof that we were in charge then.

867
00:48:11,460 --> 00:48:13,270
It's not proof that we're in charge now.

868
00:48:13,280 --> 00:48:17,800
Like, this is a, it's like Ronald Reagan of old people said, like, that freedom

869
00:48:17,800 --> 00:48:20,510
is a battle each generation has to fight.

870
00:48:20,530 --> 00:48:24,010
There's no, we can't become complacent because we're losing.

871
00:48:24,440 --> 00:48:24,970
Eternal

872
00:48:25,030 --> 00:48:26,350
yeah, that's what we need.

873
00:48:26,350 --> 00:48:31,800
And like, so, so how do we instill eternal vigilance into the culture?

874
00:48:31,920 --> 00:48:34,210
Well, I think benchmarking is quite revealing.

875
00:48:34,240 --> 00:48:36,940
So when I, I didn't finish explaining what I'd done here.

876
00:48:36,940 --> 00:48:41,970
So, uh, back in the day, working at Start9, I was like, my job, like,

877
00:48:41,970 --> 00:48:45,860
I've synced Bitcoin so many times on low end hardware, and on a Raspberry

878
00:48:45,860 --> 00:48:51,695
Pi 4, back in 2022, I could sync Using an SSD, a Raspberry Pi 4, with

879
00:48:51,715 --> 00:48:55,345
8 gigabytes of RAM, and like default core settings, and a whole bunch of,

880
00:48:55,675 --> 00:49:00,335
you know, like, no rigging the system, just like a normal node, firing up,

881
00:49:00,375 --> 00:49:03,765
clear net connections, we're not, Tor is not the bottleneck, all that stuff.

882
00:49:04,185 --> 00:49:05,345
Take 48 hours.

883
00:49:05,645 --> 00:49:09,685
I did it on Mexican internet for like a whole year in 2022, like dodgy Wi

884
00:49:09,685 --> 00:49:11,655
Fi, power outages, stuff like that.

885
00:49:12,420 --> 00:49:19,060
You know, um, so now the Raspberry Pi 5 is out, it's two, the CPU is double,

886
00:49:19,200 --> 00:49:24,840
two, twi, two times as powerful, you get the same SSD, and it's taking over

887
00:49:24,840 --> 00:49:28,680
a hundred hours, rather than about 48, right, and that's one year's worth

888
00:49:28,690 --> 00:49:31,950
of damage, so it's like inflation, it compounds, so when the government's

889
00:49:31,950 --> 00:49:35,220
like, don't worry, inflation's back to 2%, I'm like, 2 percent on top of

890
00:49:35,220 --> 00:49:38,800
what's happened these last few years, and people don't understand compounding,

891
00:49:38,800 --> 00:49:40,660
um, You know, disasters like that.

892
00:49:40,660 --> 00:49:44,430
So, if you carry on at the rate we're at, with the explosion

893
00:49:44,430 --> 00:49:49,860
of UTXOs, then, it's, it's just degrading to what can happen on IBD.

894
00:49:49,890 --> 00:49:52,730
Really, you want people to be able to run a node on an Android.

895
00:49:52,770 --> 00:49:54,940
Like, that would be great, and you're not far off that.

896
00:49:55,390 --> 00:49:59,910
But, you know, so, what were you talking about a second ago?

897
00:49:59,920 --> 00:50:03,010
Because this was related to that, and that's why we're, so bench, that's it.

898
00:50:03,020 --> 00:50:05,560
That's how you galvanize people and make them go, this is a problem.

899
00:50:05,840 --> 00:50:08,370
People have to see the stats, they have to try and run nodes,

900
00:50:08,410 --> 00:50:11,140
and then they have to go, this is fucked, I can't do this anymore.

901
00:50:11,170 --> 00:50:13,320
If you can't run a node, then it's over.

902
00:50:13,340 --> 00:50:15,470
Then you need someone else's permission to use the network.

903
00:50:15,810 --> 00:50:16,250
That's it.

904
00:50:16,270 --> 00:50:17,880
Like, you've undermined the core

905
00:50:18,350 --> 00:50:19,720
Slightly philosophical question.

906
00:50:19,760 --> 00:50:22,680
When should someone adopting Bitcoin run a node?

907
00:50:23,440 --> 00:50:25,130
it depends what you want to do.

908
00:50:25,150 --> 00:50:31,040
I think, when it comes to anything privacy related, This is like the elegance of the

909
00:50:31,040 --> 00:50:35,250
whole thing, like Bitcoin is incredibly awful when it comes to privacy, that's the

910
00:50:35,250 --> 00:50:40,070
trade off for like auditability, like, you know, and using trident to cryptography

911
00:50:40,540 --> 00:50:45,540
rather than experimental things, like, so, you want to use Bitcoin privately.

912
00:50:45,825 --> 00:50:49,215
If you want to do anything, like look up where your transaction is, is it

913
00:50:49,225 --> 00:50:53,715
in the blockchain yet, if you want to run like a coin join coordinator,

914
00:50:54,145 --> 00:50:58,615
if you want to do anything that might have any, like, hope of you preserving

915
00:50:58,615 --> 00:51:00,595
your privacy, you have to run a node.

916
00:51:01,040 --> 00:51:02,510
Because that's at the base of the stack.

917
00:51:02,710 --> 00:51:05,650
If you want to, like, Lightning's great, and it's more private than

918
00:51:05,650 --> 00:51:09,450
Bitcoin, and everyone uses LSPs, which means there is zero privacy.

919
00:51:09,960 --> 00:51:14,400
If you want to use Lightning privately, like it allows you to do, then you need

920
00:51:14,400 --> 00:51:17,050
to run a node, because your Lightning node has to sit on top of the Bitcoin node.

921
00:51:17,400 --> 00:51:20,590
The Bitcoin nodes don't do anything at all by themselves.

922
00:51:20,620 --> 00:51:24,430
The whole point is it needs to be something you use, and is

923
00:51:24,430 --> 00:51:25,920
your gateway to the network.

924
00:51:26,150 --> 00:51:29,760
And if you replace that with a human that does it on your behalf, then

925
00:51:30,295 --> 00:51:36,055
Then, that, those coalesce into one big thing, like Phoenix is like the

926
00:51:36,065 --> 00:51:40,045
dominant lightning provider now, and they have the potential to just be the

927
00:51:40,045 --> 00:51:44,545
Google of Bitcoin in the future, like, no one runs an email server, everyone

928
00:51:44,545 --> 00:51:49,565
has a Gmail account, it's a permissioned protocol, like, yes, SMTP is open,

929
00:51:49,675 --> 00:51:51,245
permissionless, borderless, all that.

930
00:51:51,685 --> 00:51:53,305
Good luck using email that way.

931
00:51:53,315 --> 00:51:57,955
Like if you want, there's another social layer on top with like a closed system

932
00:51:57,955 --> 00:52:01,535
that you need to be a part of the club to be able to participate in the protocol.

933
00:52:01,685 --> 00:52:02,885
That can happen to Bitcoin too.

934
00:52:03,035 --> 00:52:07,135
And the only way it doesn't is if you run the node and you, like it's, to Bitcoin's

935
00:52:07,145 --> 00:52:11,485
credit, it's the best I've ever seen of people go like, I need to participate

936
00:52:11,495 --> 00:52:16,045
directly with this thing at the protocol levels for it to remain permissionless.

937
00:52:16,540 --> 00:52:18,690
Like, so, when should someone run a node?

938
00:52:19,000 --> 00:52:22,200
The minute they want to do, I think privacy is the best example.

939
00:52:22,460 --> 00:52:26,460
Running it as a mere virtue signal, when you don't actually use it, is

940
00:52:26,720 --> 00:52:31,020
kind of, uh, that gives us a false sense of security, and I kind of

941
00:52:31,020 --> 00:52:32,380
wish people just wouldn't do it.

942
00:52:32,460 --> 00:52:36,580
Like, I wish everyone running a node wasn't just, you know, running it for its

943
00:52:36,580 --> 00:52:40,750
own good, or for its own feeling, and all of their wallets didn't ever touch it.

944
00:52:40,900 --> 00:52:43,210
Like, so they're using a phone wallet, like, I appreciate it.

945
00:52:43,470 --> 00:52:48,210
You know, but it's like, this is, this is like a, like a problem since forever,

946
00:52:48,270 --> 00:52:52,990
like Electrum's amazing wallet, and it, by default, does not use your own node, and

947
00:52:52,990 --> 00:52:56,570
it's actually really difficult, because you need to run an Electrum server, and

948
00:52:56,570 --> 00:52:59,370
even then, when you connect it to the Electrum server, it will still reach

949
00:52:59,370 --> 00:53:02,400
out to other public Electrum servers, and you just have to assume these are

950
00:53:02,400 --> 00:53:07,370
all spook run, like, and, that's a nightmare, like Samurai, who, everyone,

951
00:53:07,380 --> 00:53:11,175
well, Anyone that's familiar with me knows I, like, despise that project.

952
00:53:11,675 --> 00:53:16,435
To their credit, and to my sheer horror, they were the only wallet that if you

953
00:53:16,525 --> 00:53:20,685
configured it to connect to your own node, and your node was down for some reason,

954
00:53:20,885 --> 00:53:24,325
it wouldn't just go, alright, I'll connect to, like, a bunch of public ones instead.

955
00:53:24,325 --> 00:53:25,495
It would just not work.

956
00:53:25,830 --> 00:53:29,130
Which is probably an artifact of incompetence rather than ideological,

957
00:53:29,690 --> 00:53:33,360
but like, nonetheless, I'm like, I can't believe other wallets, so with Francis's

958
00:53:33,390 --> 00:53:36,960
bull bitcoin wallet that's about to come out, it's great, but I'm like, dude, it

959
00:53:36,960 --> 00:53:42,950
needs to have like a hardcore mode where it doesn't work unless it's connected to

960
00:53:42,950 --> 00:53:47,600
your node, because, and everyone's running Electrum servers, And Bitcoin nodes

961
00:53:47,710 --> 00:53:50,960
using umbrellas and startnines, which means it's all Tor based, which means

962
00:53:50,960 --> 00:53:52,870
it doesn't frickin work half the time.

963
00:53:53,320 --> 00:53:56,120
So I need it to not connect to other stuff.

964
00:53:56,460 --> 00:54:00,310
Like Blockstream Green, Wasabi Wallet, all of these things that give you the

965
00:54:00,310 --> 00:54:02,310
option of connecting to your own node.

966
00:54:02,555 --> 00:54:04,665
It's a little different with Wasabi because they use block filters and

967
00:54:04,665 --> 00:54:07,735
all that, so there's still privacy even though you don't run a node,

968
00:54:07,765 --> 00:54:09,595
but I mean, that's not great.

969
00:54:09,765 --> 00:54:11,255
I mean, it's a compromise.

970
00:54:11,595 --> 00:54:15,245
The point is, all of them will work and give you no indication that it's

971
00:54:15,245 --> 00:54:16,965
not actually using your own back end.

972
00:54:17,175 --> 00:54:18,415
They will just work anyway.

973
00:54:18,415 --> 00:54:22,145
They'll reach out to other servers and half the time you Configure it to run on

974
00:54:22,145 --> 00:54:24,725
your own node and it, it didn't even work.

975
00:54:24,725 --> 00:54:27,905
It didn't even do what you think it did after you pressed save or okay.

976
00:54:27,905 --> 00:54:29,145
It's not even using a node.

977
00:54:29,315 --> 00:54:33,265
The fact that that's like the norm in, in our, like Zeus wallets, my

978
00:54:33,265 --> 00:54:37,305
favorite lightning wallet, it still has an option, like the default of

979
00:54:37,305 --> 00:54:39,315
it is to use someone else's backend.

980
00:54:39,355 --> 00:54:42,945
Like, like, I don't want to bash it because it's such a good project.

981
00:54:42,955 --> 00:54:44,155
And I've used Zeus to like.

982
00:54:44,530 --> 00:54:48,310
I've never used it that way, it always connects to my own node, whether it's LND

983
00:54:48,310 --> 00:54:53,350
or CLN, that should be just absolutely the default, and it's just not, and until

984
00:54:53,350 --> 00:54:57,580
it is, no one has an incentive to run a node, so I used to do this whole thing

985
00:54:57,590 --> 00:55:01,335
where I would set people up in Bitcoin, And it's like day one of Bitcoin, all

986
00:55:01,335 --> 00:55:04,525
right, we're ordering you hardware to run a node, like, and people are like,

987
00:55:04,525 --> 00:55:08,265
no, no, let them ease into it, just download, you know, green or blue wallet

988
00:55:08,285 --> 00:55:09,725
on your phone, and they'll start that way.

989
00:55:09,725 --> 00:55:12,265
I'm like, no, because they'll never not do it that way.

990
00:55:12,275 --> 00:55:14,805
If you start them that way, that will be it forever.

991
00:55:15,045 --> 00:55:18,595
And Spectre wallet, which is my favorite, was another great example.

992
00:55:18,595 --> 00:55:21,915
Like, you download it, and it wants to know where your node is, and if you

993
00:55:21,915 --> 00:55:23,625
don't have one, it just doesn't work.

994
00:55:23,865 --> 00:55:28,235
Like, this is Moritz, who was working there at the time, I hope he still is.

995
00:55:30,200 --> 00:55:33,290
Default settings define user behavior.

996
00:55:33,690 --> 00:55:34,990
This is absolutely true.

997
00:55:35,040 --> 00:55:38,610
So if you're Electrum Wallet and you don't push people to run their

998
00:55:38,610 --> 00:55:40,450
own node, then no one actually will.

999
00:55:40,620 --> 00:55:43,760
And even if they do run it, it won't have anything to do with their wallet

1000
00:55:43,760 --> 00:55:45,620
activities and their lightning activities.

1001
00:55:46,020 --> 00:55:48,970
They'll just be separated, so the node isn't really doing anything.

1002
00:55:49,130 --> 00:55:51,180
It's just providing a redundant copy of the blockchain.

1003
00:55:51,740 --> 00:55:53,625
But it's not part of your sovereign network.

1004
00:55:53,935 --> 00:55:55,275
approach as a bitcoiner.

1005
00:55:55,475 --> 00:56:00,425
So you have to, it's a mindful design process of everyone in the network.

1006
00:56:00,955 --> 00:56:04,915
saying I'm not prepared to Bitcoin unless it's going through my own node.

1007
00:56:04,915 --> 00:56:08,395
If that, if that's a dominant part of the culture, everything's downstream of that.

1008
00:56:08,665 --> 00:56:09,915
And this is all social, right?

1009
00:56:09,935 --> 00:56:12,965
And it's when we talk about we and everyone is allergic to any sort

1010
00:56:12,965 --> 00:56:16,085
of collectivism and you're even you, you're careful like us and we,

1011
00:56:16,085 --> 00:56:16,825
I don't want to use these words.

1012
00:56:17,275 --> 00:56:21,585
Sorry, like culture is like Bitcoin is a very powerful and strong

1013
00:56:21,585 --> 00:56:23,405
culture with powerful memes.

1014
00:56:24,065 --> 00:56:28,375
And these are, these are so essential for defining how people's actions are.

1015
00:56:28,735 --> 00:56:33,095
Like, running a node's not a thing you just do, like, no one runs a server.

1016
00:56:33,095 --> 00:56:36,135
Like, running a node is most people getting their feet wet in

1017
00:56:36,135 --> 00:56:38,285
running their first server, ever.

1018
00:56:38,675 --> 00:56:40,785
Like, no one would do that when you're signing them up to their

1019
00:56:40,785 --> 00:56:42,565
first email account 20 years ago.

1020
00:56:42,575 --> 00:56:45,155
No one's gonna be like, oh, I'm gonna run my own email server.

1021
00:56:45,155 --> 00:56:47,105
That wasn't a part of email culture.

1022
00:56:47,335 --> 00:56:47,955
It just wasn't.

1023
00:56:47,965 --> 00:56:51,355
Like, Bitcoin has this, and it's great, and it's why the network

1024
00:56:51,355 --> 00:56:52,535
has the resilience it does.

1025
00:56:52,725 --> 00:56:54,725
So celebrate it and keep pushing that way.

1026
00:56:54,955 --> 00:57:03,395
Yeah, but I, speaking for myself, I think, like, I can do more good, uh, encouraging

1027
00:57:03,525 --> 00:57:09,265
people to do these things than, than doing in, than doing them myself, basically.

1028
00:57:09,265 --> 00:57:10,075
If I spend my

1029
00:57:10,095 --> 00:57:11,195
Well, they're both valuable.

1030
00:57:11,285 --> 00:57:13,875
yeah, of course, I should do it myself and I should, like, deep

1031
00:57:13,875 --> 00:57:15,775
dive more into all the stuff.

1032
00:57:15,875 --> 00:57:19,015
But, but everything's a trade off and, like, you only have

1033
00:57:19,015 --> 00:57:20,875
limited time, so, like, yeah.

1034
00:57:21,785 --> 00:57:24,115
Run your node and, like, subscribe and brush your teeth.

1035
00:57:24,345 --> 00:57:28,115
Well, this is, like, the, the government is the biggest help with all this stuff.

1036
00:57:28,175 --> 00:57:34,425
Like, and, I mean, there's no eternal vigilance without an obvious enemy

1037
00:57:34,995 --> 00:57:36,815
who is trying to fuck you over.

1038
00:57:36,875 --> 00:57:40,465
Like, this is, you need tyrannical governments for people to

1039
00:57:40,465 --> 00:57:41,805
understand the Second Amendment.

1040
00:57:42,245 --> 00:57:45,065
Otherwise, they will just go, oh, guns are stupid, we don't need them.

1041
00:57:45,125 --> 00:57:48,865
Like, you know, it's like, it's, that's just so obvious, right?

1042
00:57:48,865 --> 00:57:52,615
So you need, you need You need like, you need Biden to win the election,

1043
00:57:52,635 --> 00:57:57,065
and you need him to be really stupid, like, you need him to go like,

1044
00:57:57,065 --> 00:57:59,955
Well, Trump's in favor of Bitcoin, I'm gonna make Bitcoin illegal!

1045
00:57:59,965 --> 00:58:03,605
And then everyone's like, shit, I have to run my own node now, because, like,

1046
00:58:03,645 --> 00:58:09,065
the best thing ever is, Samurai gets, uh, like, arrested, and privacy becomes bad.

1047
00:58:09,405 --> 00:58:11,915
Biggest overnight upgrade to Bitcoin's privacy that's ever

1048
00:58:11,915 --> 00:58:13,565
happened, thanks to the US government.

1049
00:58:13,655 --> 00:58:16,585
The broken privacy tool is gone, now everyone's forced to

1050
00:58:16,585 --> 00:58:17,785
use joint market and wasabi.

1051
00:58:18,070 --> 00:58:21,850
That was amazing, and everyone is like lamenting about it, and I'm like

1052
00:58:21,850 --> 00:58:25,150
it's awful, like in principle, these people should not be arrested for what

1053
00:58:25,150 --> 00:58:29,280
they were doing, it's wrong, but on a practical level, this was so good, like

1054
00:58:29,300 --> 00:58:33,100
I can tell people till I'm blue in the face, podcast after podcast, don't use

1055
00:58:33,100 --> 00:58:36,060
Samurai, but it doesn't matter, the government can come along and arrest

1056
00:58:36,060 --> 00:58:40,650
them, okay, great, like I'm sorry, like please don't get confused, like what

1057
00:58:40,650 --> 00:58:45,615
I'm, what my point is here, I'm no way think it's okay that they are facing The,

1058
00:58:45,625 --> 00:58:47,695
the awful shit they're facing, right?

1059
00:58:47,695 --> 00:58:51,225
And I, personal dislike aside, I hope they walk free.

1060
00:58:51,565 --> 00:58:53,535
Like I, I believe in the same mission.

1061
00:58:53,535 --> 00:58:56,825
I'm on the same team, but I'm just saying, so when it comes to other

1062
00:58:56,825 --> 00:58:59,795
things, we'll run a node, like I can tell people run a node forever.

1063
00:58:59,795 --> 00:59:02,805
If Biden comes along and says, that's it, Bitcoin's illegal, then you have

1064
00:59:02,805 --> 00:59:06,105
no choice suddenly, like, and, but it already happened is my point.

1065
00:59:06,275 --> 00:59:08,405
Like all of these wallets left America.

1066
00:59:08,705 --> 00:59:11,295
Like, so many companies just went, That's it, we're not doing it.

1067
00:59:11,305 --> 00:59:11,605
Wallet of

1068
00:59:11,995 --> 00:59:13,575
it's shutting down because it's not worth

1069
00:59:13,595 --> 00:59:15,505
CoinJunk Coordinator, no more.

1070
00:59:15,515 --> 00:59:18,045
Like, every single one of these was really good.

1071
00:59:18,145 --> 00:59:21,455
Now everyone that wants to use Wasabi has to run a coordinator.

1072
00:59:21,665 --> 00:59:22,355
Yes!

1073
00:59:22,585 --> 00:59:25,695
Now it like, do you know how good that is for decentralization?

1074
00:59:26,085 --> 00:59:27,865
Like, and you can't do stuff like that.

1075
00:59:28,135 --> 00:59:32,415
And it's like, Bitcoin itself can't even be demonstrably useful unless governments

1076
00:59:32,455 --> 00:59:37,125
print money and fuck up entire generations and hyperinflate and, like, rob your

1077
00:59:37,135 --> 00:59:41,235
savings account and, like, without that, no one is gonna understand Bitcoin.

1078
00:59:41,265 --> 00:59:45,195
So it's like, I can tell you, like, like, it's like Seyfriedian says, like, if

1079
00:59:45,205 --> 00:59:49,075
they get fiscally responsible and adopt a gold standard, then Bitcoin's fucked.

1080
00:59:49,640 --> 00:59:49,970
Yeah, yeah.

1081
00:59:50,045 --> 00:59:51,105
that's, that's it.

1082
00:59:51,105 --> 00:59:51,808
That's

1083
00:59:51,820 --> 00:59:55,620
is so funny because we ask a lot of our guests if they're, uh, like

1084
00:59:55,770 --> 00:59:59,330
more pro, a pro Bitcoin politician or an anti Bitcoin politician.

1085
00:59:59,330 --> 00:59:59,670
And like

1086
00:59:59,900 --> 01:00:00,280
It's so

1087
01:00:00,510 --> 01:00:05,490
I was so like seeing how the community reacts to Donald Trump all of a

1088
01:00:05,490 --> 01:00:10,365
sudden, uh, saying, saying stuff and like, And then everyone's like, Oh,

1089
01:00:10,375 --> 01:00:12,325
of course we should vote for Trump.

1090
01:00:12,765 --> 01:00:13,765
Like, are you mad?

1091
01:00:13,825 --> 01:00:19,365
Like, what this crony capitalist, like a guy who printed money to give

1092
01:00:19,365 --> 01:00:24,285
out to people during COVID and the lockdowns and stuff, and you think

1093
01:00:24,295 --> 01:00:28,215
he's Donald Trump of all people is gonna, you know, Keep his promise.

1094
01:00:28,245 --> 01:00:31,965
And like, you, you want his permission to run your node?

1095
01:00:31,975 --> 01:00:33,455
What, what, what the fuck?

1096
01:00:33,575 --> 01:00:34,705
What's wrong with people?

1097
01:00:34,740 --> 01:00:39,310
just can't, like, on an ideological level, like, I think

1098
01:00:39,320 --> 01:00:40,840
everyone's just seeking approval.

1099
01:00:40,890 --> 01:00:44,910
Everyone's insecure, and everyone's like, oh, Trump now says Bitcoin's good.

1100
01:00:45,460 --> 01:00:49,780
Like, now, look, dad, am I still an idiot now, dad, for being into Bitcoin?

1101
01:00:49,820 --> 01:00:50,770
Like, I think it's that.

1102
01:00:50,870 --> 01:00:55,190
I think, like, it's, like, people just, they're so used to being called crazy by

1103
01:00:55,190 --> 01:00:59,085
everyone in their family, and then when Trump comes out and says, Like, Bitcoin's

1104
01:00:59,115 --> 01:01:03,055
really good, I got a lot of Bitcoin, like, just, if it comes out like that,

1105
01:01:03,065 --> 01:01:04,975
everyone's like, I'm validated, yes!

1106
01:01:05,285 --> 01:01:06,375
Like, I'm validated.

1107
01:01:06,565 --> 01:01:07,835
Trump is running a node?

1108
01:01:08,145 --> 01:01:09,475
it's so naive.

1109
01:01:09,515 --> 01:01:10,465
Like, it's so naive.

1110
01:01:10,475 --> 01:01:14,415
First, like, it's such a horrible form of it.

1111
01:01:14,605 --> 01:01:17,175
Like, it's the public codes in mining again.

1112
01:01:17,565 --> 01:01:21,935
It's the high hash rate that has no discernible meaning.

1113
01:01:22,205 --> 01:01:24,685
Real effect on Bitcoin's overall security.

1114
01:01:24,945 --> 01:01:25,985
It just looks good.

1115
01:01:26,025 --> 01:01:27,495
Like, difficulty went way up.

1116
01:01:27,495 --> 01:01:30,835
So now an attacker will have more work to do to reorg the chain.

1117
01:01:31,215 --> 01:01:33,415
Yes, but what if that is the attacker?

1118
01:01:33,905 --> 01:01:38,095
Like, what if that, what if that person that's making it unprofitable

1119
01:01:38,095 --> 01:01:42,025
to mine, if for any pleb in the world, because that's, the higher the

1120
01:01:42,025 --> 01:01:45,840
difficulty, the more everyone else gives up mining, All of the difficulty

1121
01:01:45,840 --> 01:01:49,630
is only so high because of zombie pubcos that are losing money, spinning

1122
01:01:49,630 --> 01:01:54,750
nice narratives and selling, you know, being an artifact of the money printer.

1123
01:01:54,760 --> 01:01:58,410
Like, people are printing money, investing in garbage, and they don't know

1124
01:01:58,410 --> 01:02:01,270
anything about it, but they'll invest in a bunch of publicly traded bitcoin

1125
01:02:01,470 --> 01:02:05,430
mining companies that are mining at a loss, making the difficulty go higher,

1126
01:02:05,440 --> 01:02:08,550
and providing no network security at all because they will do exactly what

1127
01:02:08,550 --> 01:02:10,560
they're told by the regulatory bodies.

1128
01:02:10,900 --> 01:02:12,960
That allow them to exist.

1129
01:02:13,240 --> 01:02:15,760
These are not cypherpunks, they're not miners, and they're not a

1130
01:02:15,920 --> 01:02:17,530
line of defense for the network.

1131
01:02:17,910 --> 01:02:21,780
They, all they are doing is just making it less profitable to be all of those things.

1132
01:02:22,050 --> 01:02:26,770
That's an illusion of security, and Trump is the perfect example of, like, that.

1133
01:02:27,100 --> 01:02:30,930
It's like, he will approve of bitcoin, but it will be government approved

1134
01:02:30,980 --> 01:02:36,745
bitcoin, which is, which puts it in a set of confines that people are, It's

1135
01:02:36,775 --> 01:02:41,075
unprofitable to step outside of it, like if I want to buy, if I want to buy salt,

1136
01:02:41,095 --> 01:02:45,645
it's cheap, if I want to buy an illegal white powder, it's a hundred thousand

1137
01:02:45,645 --> 01:02:49,465
times more expensive because it's not operating within these confines, so

1138
01:02:49,465 --> 01:02:54,575
if they're going to create two classes of bitcoin, which is Approved bitcoin,

1139
01:02:54,615 --> 01:02:56,705
that implies an unapproved bitcoin.

1140
01:02:56,705 --> 01:02:59,135
And the minute, like, we have this with the KYC system.

1141
01:02:59,175 --> 01:03:01,825
It's like, I have these two types of bitcoin.

1142
01:03:02,145 --> 01:03:05,855
I have my, everyone's like, I have my KYC stash and I have my no KYC stash.

1143
01:03:05,885 --> 01:03:08,815
I'm like, that's, that's the government fucking us.

1144
01:03:09,020 --> 01:03:13,420
Because that's an attack on fungibility from the start, you have, you cannot have

1145
01:03:13,420 --> 01:03:17,990
two classes of this thing, because all sats are equal, one sat equals one sat at

1146
01:03:18,000 --> 01:03:22,010
the protocol level, the minute you corrupt that understanding, you undermine it, so

1147
01:03:22,480 --> 01:03:27,210
what you want is for governments to help us by saying there is only one bitcoin,

1148
01:03:27,790 --> 01:03:32,350
all of it's equal, and they can only do that by completely ignoring it, which is

1149
01:03:32,350 --> 01:03:34,360
impossible, or by making it all illegal.

1150
01:03:34,360 --> 01:03:36,985
And Those are the only two ways in which you can get their help.

1151
01:03:37,175 --> 01:03:40,385
So this is why it's so useful when they say, when they go hysterically

1152
01:03:40,385 --> 01:03:44,235
overreact, this is why I hope it happens, I hope they rig it again, I hope Biden

1153
01:03:44,245 --> 01:03:47,955
wins, and I hope he makes it a big part of his strategy to be hysterically

1154
01:03:47,965 --> 01:03:51,115
stupid when it comes to Bitcoin and go, That's it, it's all illegal.

1155
01:03:51,325 --> 01:03:53,835
Then all the LSPs are gone, everyone has to run a node.

1156
01:03:54,275 --> 01:03:57,045
Uh, all of the publicly traded miners are gone, so they all,

1157
01:03:57,275 --> 01:03:59,955
that just means plebs mining in their garage just make more money.

1158
01:04:00,185 --> 01:04:03,765
Like, it, suddenly everything gets way better, they fix everything overnight,

1159
01:04:03,765 --> 01:04:05,065
just like they did with privacy.

1160
01:04:05,395 --> 01:04:09,455
And, I'm just like, the, it feels psychopathic for me to want this.

1161
01:04:09,565 --> 01:04:11,575
I'm not in America, I don't live there, and I don't need

1162
01:04:11,605 --> 01:04:12,805
to worry about these things.

1163
01:04:13,065 --> 01:04:14,945
I don't want to be a martyr, and it hurts.

1164
01:04:15,255 --> 01:04:21,645
I get it, but I'm sorry, we just don't, you gotta, you gotta get hurt to grow, and

1165
01:04:21,645 --> 01:04:27,485
Bitcoin, anti fragility is inefficient, and we will always, no one is voluntarily

1166
01:04:27,535 --> 01:04:31,955
anti fragile, no one wants to have like, you know, I'll have 15 kids, and then I'll

1167
01:04:31,955 --> 01:04:35,465
ask someone to come in my house with a, like, you know, and start killing people,

1168
01:04:35,465 --> 01:04:40,155
and whoever the strongest are survive, and then I have a stronger offspring, like,

1169
01:04:40,505 --> 01:04:42,565
No one would voluntarily want that, right?

1170
01:04:42,795 --> 01:04:46,145
But it would be how you'd make your genetic lineage more strong, right?

1171
01:04:46,335 --> 01:04:50,735
Like, but it would work, is my point, like, but it's psychopathic, we want an

1172
01:04:50,735 --> 01:04:55,535
easy life, but the easy life is rotten, and it's, it's centralized, and it's

1173
01:04:55,555 --> 01:05:00,055
really efficient, and so, like, What I really want is everyone to use BISC.

1174
01:05:00,055 --> 01:05:02,215
I want everyone to use decentralized exchanges.

1175
01:05:02,455 --> 01:05:04,485
Everyone is just going to use Coinbase, right?

1176
01:05:04,485 --> 01:05:06,255
Because it's more efficient, it's cheaper.

1177
01:05:06,445 --> 01:05:10,035
And I'm like, again, Joe Biden can crush that in one minute.

1178
01:05:10,045 --> 01:05:11,775
He can say, you guys don't have permission anymore.

1179
01:05:11,805 --> 01:05:12,525
Bitcoin's illegal.

1180
01:05:12,835 --> 01:05:16,315
So I'm like, this is, if we have any sense, we vote for hostile

1181
01:05:16,345 --> 01:05:21,145
politicians or like complete Ron Paul types that will genuinely reliably

1182
01:05:21,145 --> 01:05:22,485
just leave us the fuck alone.

1183
01:05:22,845 --> 01:05:25,885
So, but, Trump is not that kind of politician.

1184
01:05:25,895 --> 01:05:30,875
He's someone that will create a sandboxed Bitcoin that's government approved as

1185
01:05:30,875 --> 01:05:34,775
a gesture to this particular portion of his voting base, and that's, that's not

1186
01:05:34,775 --> 01:05:36,185
going to help with resilience at all.

1187
01:05:36,205 --> 01:05:37,635
Is Bukele that person?

1188
01:05:38,385 --> 01:05:39,215
Good question.

1189
01:05:39,555 --> 01:05:40,665
Mele that person?

1190
01:05:41,025 --> 01:05:42,135
I don't know enough about Millet.

1191
01:05:42,395 --> 01:05:46,155
I think, Millet is like, certainly he talks the talk,

1192
01:05:46,970 --> 01:05:50,140
are hints that he's not walking the walk, that you need to

1193
01:05:50,140 --> 01:05:51,890
report your crypto holdings or

1194
01:05:52,075 --> 01:05:56,025
Yeah, I saw that, but again, I don't, I don't claim to understand

1195
01:05:56,025 --> 01:06:00,645
the, the, the residual laws and stuff of Argentina, right?

1196
01:06:00,645 --> 01:06:05,135
I don't know, like, I, I want to like Millet, I do, like, but that doesn't mean

1197
01:06:05,135 --> 01:06:07,455
I know, like, shit about fuck, so, like,

1198
01:06:07,600 --> 01:06:08,310
No, no, no.

1199
01:06:08,370 --> 01:06:12,580
I want to, like, everything he does and says is stuff that I like.

1200
01:06:12,600 --> 01:06:16,800
I mean, he quotes Rothbard, he dresses as a superhero, he has a chainsaw,

1201
01:06:17,090 --> 01:06:19,830
and he has the best sideburns ever, so how can you not love him?

1202
01:06:19,830 --> 01:06:20,830
Oh, well, he's a politician.

1203
01:06:20,840 --> 01:06:21,690
Oh, okay, that's

1204
01:06:21,885 --> 01:06:23,665
and he's got, like, foul language as well,

1205
01:06:23,790 --> 01:06:24,200
Yeah, yeah,

1206
01:06:24,205 --> 01:06:25,515
refreshing, it's very

1207
01:06:25,540 --> 01:06:26,740
I love it, yeah.

1208
01:06:26,855 --> 01:06:30,295
I don't think like, I don't, I think again the best thing Bukele

1209
01:06:30,305 --> 01:06:34,075
can do is just step out of the way when it comes to Bitcoin, like,

1210
01:06:34,150 --> 01:06:34,860
But it's not.

1211
01:06:35,055 --> 01:06:35,565
well,

1212
01:06:36,050 --> 01:06:40,300
He's, he's saying, like, legal tender laws is not stepping out of the way.

1213
01:06:40,300 --> 01:06:42,830
It is, like, dictating the way.

1214
01:06:43,585 --> 01:06:49,615
well it, the way they did it was not, uh, the way the law is written, and

1215
01:06:49,615 --> 01:06:53,675
the way it's interpreted, I'll pay more attention to the latter, until you

1216
01:06:53,675 --> 01:06:56,495
become a real like, you know, Nazi, like,

1217
01:06:56,840 --> 01:07:01,800
Yeah, yeah, yeah, I know, uh, there's libertarianism, Nazism, so, so, yeah, it's

1218
01:07:02,035 --> 01:07:06,580
it sets a bad precedent, but like, in theory, There's punishment for not,

1219
01:07:06,680 --> 01:07:08,010
no actually that's not even true.

1220
01:07:08,010 --> 01:07:11,760
There's a caveat in the law that they made around the legal tender where it

1221
01:07:11,760 --> 01:07:16,280
looked for a minute if you don't accept bitcoin in El Salvador you're in trouble

1222
01:07:16,530 --> 01:07:20,110
but there was something later on in the same document that said don't worry

1223
01:07:20,110 --> 01:07:23,650
about it and that was my experience when I'm there like 90 percent of merchants

1224
01:07:23,650 --> 01:07:26,810
don't accept it and they're not worried that they're about to get arrested

1225
01:07:26,840 --> 01:07:27,960
because they only take the dollar.

1226
01:07:27,990 --> 01:07:30,820
Like it's not, there's no enforcement on that level.

1227
01:07:31,225 --> 01:07:33,885
And I don't, the law isn't even structured that way anyway.

1228
01:07:34,185 --> 01:07:37,655
And to be honest, it's like a stupid social thing, right?

1229
01:07:37,665 --> 01:07:40,475
Like, all of the old political par Because he's like a weird,

1230
01:07:40,605 --> 01:07:42,565
out, left field candidate, right?

1231
01:07:42,565 --> 01:07:43,835
That miraculously won.

1232
01:07:44,165 --> 01:07:48,180
So all of the old political god, like You know, he's like, if the Libertarian

1233
01:07:48,180 --> 01:07:51,360
Party were to win in America, like, the Republicans and the Democrats are

1234
01:07:51,360 --> 01:07:55,750
gonna trash you, and all of the crony capitalists are gonna take part in that.

1235
01:07:55,940 --> 01:07:58,400
So actually, none of the elite in El Salvador are into Bitcoin.

1236
01:07:58,980 --> 01:08:01,790
Like, so, if you're like, at Bitcoin Beach, buying a banana,

1237
01:08:01,790 --> 01:08:02,990
yeah, they'll take lightning.

1238
01:08:03,020 --> 01:08:05,965
But if you're in a steakhouse, Up in the middle of the mountain

1239
01:08:05,965 --> 01:08:07,835
somewhere, they don't take bitcoin.

1240
01:08:08,105 --> 01:08:10,125
Because they're like old rich in the country.

1241
01:08:10,215 --> 01:08:11,465
They don't like Bukele.

1242
01:08:11,475 --> 01:08:15,405
He's like a, you know, he's like a, a populist candidate or whatever.

1243
01:08:15,405 --> 01:08:18,285
And they, they, he didn't make the right agreements with them.

1244
01:08:18,285 --> 01:08:21,835
They have their, you know, little things with the entrenched elite

1245
01:08:21,855 --> 01:08:24,345
that weren't doing anything about how crap the country was.

1246
01:08:24,345 --> 01:08:27,455
And so by virtue of that, they have to be anti bitcoin because

1247
01:08:27,455 --> 01:08:28,675
it's a Bukele initiative.

1248
01:08:28,855 --> 01:08:30,015
So this is politics,

1249
01:08:30,290 --> 01:08:31,900
Did you spend a lot of time there?

1250
01:08:32,180 --> 01:08:36,510
I spent two weeks there earlier this year, uh, we were in El Zonte for most of it.

1251
01:08:36,860 --> 01:08:41,300
Like, El Zonte, I didn't use my credit card once, but I never really went outside

1252
01:08:41,310 --> 01:08:45,930
El Zonte, so, but when I went, you know, but I spoke to John Attack a lot, who's

1253
01:08:45,930 --> 01:08:50,025
a core developer that lives in, uh, And he, he explained how it breaks down.

1254
01:08:50,035 --> 01:08:53,475
Like, all the kids there, like, the teenagers think Bitcoin's, like, gay,

1255
01:08:53,475 --> 01:08:54,645
and they don't want to touch it, right?

1256
01:08:54,645 --> 01:08:57,895
They're just like, aww, because it's like a government approved thing.

1257
01:08:57,895 --> 01:08:59,635
It's not a cypherpunk thing to them.

1258
01:08:59,635 --> 01:09:02,195
It's just like, oh, yeah, like, what's this shit?

1259
01:09:02,205 --> 01:09:03,005
Like, I don't want to use Bitcoin.

1260
01:09:03,305 --> 01:09:04,675
Like, the government told me it's good.

1261
01:09:04,715 --> 01:09:10,270
It's like It's just that level of like, mind, I'm not talking about like,

1262
01:09:10,650 --> 01:09:14,940
resilience for the overall network, like, Chivo is obviously just crap,

1263
01:09:14,990 --> 01:09:18,350
as far as I can tell, like it can't even, half the time it can't find an

1264
01:09:18,350 --> 01:09:23,010
on chain transaction, like, I mean it's a government IT project, how good

1265
01:09:23,010 --> 01:09:28,010
was it gonna be, like, no one, I, I've paid like 90 payments when I was in El

1266
01:09:28,010 --> 01:09:30,740
Salvador, not a single person used Chivo.

1267
01:09:31,310 --> 01:09:32,170
Yeah, well, that's good.

1268
01:09:32,485 --> 01:09:38,105
well, sure, but like, they're all still using Blink, um, which is

1269
01:09:38,135 --> 01:09:42,445
good, but it's centralized, and it's permissioned, and it's nothing like

1270
01:09:42,445 --> 01:09:43,745
what Lightning's supposed to be.

1271
01:09:44,375 --> 01:09:48,695
And, uh, one, a few people use Wallet of Satoshi, and that's the same, right?

1272
01:09:48,765 --> 01:09:51,785
I didn't, I never paid someone that was running their own node.

1273
01:09:51,835 --> 01:09:53,145
Like, that never happened.

1274
01:11:33,075 --> 01:11:38,185
So when it comes to custodial lightning, so like, how big of a problem is that?

1275
01:11:38,185 --> 01:11:41,215
Because the way I see it is like, okay, it's custodial, so they

1276
01:11:41,215 --> 01:11:45,655
could technically do fractional reserve banking on, on lightning.

1277
01:11:46,085 --> 01:11:46,385
Yeah.

1278
01:11:46,440 --> 01:11:51,150
it's still more monitorable than the old banking system.

1279
01:11:51,160 --> 01:11:54,920
So it's like, it's, uh, it's, it's harder to do a fractional reserve

1280
01:11:54,920 --> 01:11:57,060
on, on, on Bitcoin than to do it on

1281
01:11:57,085 --> 01:12:00,055
This was Lynn Alden's point, like, the more easy it is for

1282
01:12:00,055 --> 01:12:01,785
you to verify a thing, the less

1283
01:12:03,920 --> 01:12:06,790
Out of rebounds with reality, it can become.

1284
01:12:06,820 --> 01:12:10,740
Like, so, because gold is that hard to verify, you can have X amount

1285
01:12:10,780 --> 01:12:13,140
more gold, fake gold in the system.

1286
01:12:13,330 --> 01:12:17,890
Because bitcoin is this easy to verify, you can have a fraction

1287
01:12:17,890 --> 01:12:19,340
of whatever that X value is.

1288
01:12:19,380 --> 01:12:21,960
Like, like, how much gold is there supposed to be and how

1289
01:12:21,960 --> 01:12:23,190
much gold actually is there?

1290
01:12:23,565 --> 01:12:28,545
There's like a greater room for, for something like in theory, like in

1291
01:12:28,545 --> 01:12:33,025
theory, like the collective spreadsheets of the world with all the, the 21

1292
01:12:33,025 --> 01:12:37,535
million Bitcoins, like there's going to be more than 21 million because

1293
01:12:37,545 --> 01:12:39,255
someone is running a scam somewhere.

1294
01:12:39,255 --> 01:12:42,765
But in, in theory, I think, I think the theory is correct.

1295
01:12:42,765 --> 01:12:43,825
Like it can't get.

1296
01:12:44,180 --> 01:12:48,280
To run away, like, I'm sure if you add up all the spreadsheets in the

1297
01:12:48,280 --> 01:12:53,100
world, all the exchanges, there is too many bitcoin, someone is lying about

1298
01:12:53,100 --> 01:12:55,580
it, but it can't, yeah, the point is

1299
01:12:55,670 --> 01:12:58,930
so, so, so custodial lightning is bad, but it's still better

1300
01:12:58,930 --> 01:13:00,090
than the old banking system.

1301
01:13:00,090 --> 01:13:01,970
That's like, that's like my position.

1302
01:13:01,970 --> 01:13:04,090
And I, I'm just trying to verify that.

1303
01:13:04,568 --> 01:13:06,800
Yeah,

1304
01:13:06,920 --> 01:13:08,430
a complete and utter lie.

1305
01:13:09,240 --> 01:13:13,670
Utter waste of time, because if it's all in a centralized database, just

1306
01:13:13,720 --> 01:13:19,620
do custodial on chain, like, it's, either way it's off chain, like, there

1307
01:13:19,620 --> 01:13:23,710
is no benefit, like, apart from the fact that if I'm a real Lightning

1308
01:13:23,710 --> 01:13:27,730
user, which no one is, I can actually pay you and someone else can run the

1309
01:13:27,740 --> 01:13:29,530
back end and, you know, organize that.

1310
01:13:29,540 --> 01:13:33,210
But if every single person in El Salvador, which is basically the case,

1311
01:13:33,460 --> 01:13:38,040
is all just moving around Lightning, but it's all just in Blink's database, same

1312
01:13:38,040 --> 01:13:42,200
with Strike, if everyone is just doing that, why are we calling it Lightning?

1313
01:13:42,210 --> 01:13:44,760
It's literally just a database run by a company.

1314
01:13:44,910 --> 01:13:46,410
You might as well just do it on chain.

1315
01:13:46,840 --> 01:13:50,940
Like, it, it, it, it, it, it wouldn't be on chain is the point.

1316
01:13:50,950 --> 01:13:52,070
You're not using Lightning.

1317
01:13:52,595 --> 01:13:56,265
So, the point of Lightning is to not have an on chain footprint, but

1318
01:13:56,275 --> 01:14:00,985
if you're never touching the chain, uh, do you get what I'm saying?

1319
01:14:01,041 --> 01:14:02,410
I, I do, I do get it.

1320
01:14:02,495 --> 01:14:04,895
I don't get why it's called Lightning, it doesn't really,

1321
01:14:05,225 --> 01:14:08,855
but maybe it should be called something else, but still, still, like, it provides

1322
01:14:08,855 --> 01:14:13,605
a service if you're doing small payments and then you, or it's, uh, even more

1323
01:14:13,605 --> 01:14:17,375
importantly, receiving small payments, and then when you come home, you, you

1324
01:14:17,395 --> 01:14:22,665
send it to cold storage and you're fine, like, so, so, so, so, so, like, because

1325
01:14:22,665 --> 01:14:25,045
the convenience is the, the speed of it,

1326
01:14:25,302 --> 01:14:29,357
I think so, like, When you interact with the network, it helps that it's

1327
01:14:29,357 --> 01:14:33,097
a lightning wallet, like, because you can get in and out and, like, Blink

1328
01:14:33,097 --> 01:14:35,877
and Wallet of Satoshi are obviously running lightning infrastructure, so

1329
01:14:35,877 --> 01:14:37,507
they can pay and receive that way.

1330
01:14:37,847 --> 01:14:41,387
So it's useful, it's just the way it manifested is such a bastardization of

1331
01:14:41,387 --> 01:14:43,007
what the point of lightning was anyway.

1332
01:14:43,347 --> 01:14:47,727
The point was, you know, remain sovereign without an on chain footprint, but

1333
01:14:47,727 --> 01:14:48,957
they got rid of the sovereign bit.

1334
01:14:49,307 --> 01:14:52,987
So it's like, okay, so now it's just no one chain footprint, alright,

1335
01:14:53,067 --> 01:14:55,147
but then, you don't, that's not,

1336
01:14:55,282 --> 01:14:55,722
then what's

1337
01:14:55,787 --> 01:14:58,497
that point there's no point in lightning, just move money around

1338
01:14:58,497 --> 01:15:03,227
coinbase accounts, like, or whatever third party you want, like, you're

1339
01:15:03,257 --> 01:15:07,057
trusting a centralized third party to hold your bitcoin for you and move it

1340
01:15:07,057 --> 01:15:08,902
around, uh, internally, internally.

1341
01:15:09,092 --> 01:15:11,672
And it's, that's, that's good, that was always gonna happen, right?

1342
01:15:11,672 --> 01:15:13,312
It's just weird to call it lightning for me.

1343
01:15:13,312 --> 01:15:17,952
It's misleading, like, it, I don't, I don't want to say it's, like, pointless,

1344
01:15:17,972 --> 01:15:21,302
cause I'm saying that here and I take it back, it's not pointless, cause I was

1345
01:15:21,302 --> 01:15:25,222
able to use it, with my own lightning infrastructure, and you cannot, if you

1346
01:15:25,222 --> 01:15:28,572
can't set up a lightning node, and I need to pay you lightning, then great, use

1347
01:15:28,572 --> 01:15:32,627
Blink, or Wallet of Satoshi, or Phoenix, and they'll handle it for you, I'm just

1348
01:15:32,627 --> 01:15:35,677
saying, now most people's impression of Lightning has nothing to do with

1349
01:15:35,677 --> 01:15:37,277
what it actually is supposed to do.

1350
01:15:37,277 --> 01:15:40,347
It's supposed to be a way for you to aggregate all your on chain activity and

1351
01:15:40,357 --> 01:15:43,227
be more efficient with it, and that's not what they're doing with it, and

1352
01:15:43,227 --> 01:15:44,677
that won't be their understanding of it.

1353
01:15:45,092 --> 01:15:48,802
Still is better than a Coinbase account, because you can actually

1354
01:15:48,802 --> 01:15:50,332
interact with the real deal.

1355
01:15:51,457 --> 01:15:53,187
I mean, Coinbase have Lightning now.

1356
01:15:53,617 --> 01:15:53,777
Oh,

1357
01:15:54,007 --> 01:15:57,747
I mean, it is, at the end of the day, it just comes down to, like, I like

1358
01:15:57,834 --> 01:16:01,890
yeah,

1359
01:16:02,067 --> 01:16:04,077
like, but they're still in the same position.

1360
01:16:04,107 --> 01:16:05,597
I'm still not sovereign anymore.

1361
01:16:05,987 --> 01:16:07,452
So Sucks.

1362
01:16:07,492 --> 01:16:10,152
Like, I don't know, there's no solution to this.

1363
01:16:10,432 --> 01:16:13,462
My only solution is just like, someone needs to die.

1364
01:16:13,462 --> 01:16:14,792
It's like, it's just awful.

1365
01:16:15,162 --> 01:16:18,402
I'm sorry, but like, you need them to come and crack down on Bitcoin

1366
01:16:18,402 --> 01:16:21,652
and just be horrible about it and like, and then everyone is just

1367
01:16:21,652 --> 01:16:23,742
forced to go underground with it.

1368
01:16:23,772 --> 01:16:27,312
And the fear about it making the price tank, to me, is not valid at

1369
01:16:27,312 --> 01:16:30,362
all, because all the price discovery mechanisms also disappeared.

1370
01:16:30,462 --> 01:16:32,752
Like, how can the price tank if Bitcoin's illegal?

1371
01:16:33,167 --> 01:16:35,267
Like, that, where are you doing the exchange?

1372
01:16:35,267 --> 01:16:38,317
What's the, you're not on like, you know, CoinGecko.

1373
01:16:38,327 --> 01:16:39,717
Like, ooh, what's the price today?

1374
01:16:39,747 --> 01:16:41,807
Like, it's, those APIs will be gone.

1375
01:16:41,977 --> 01:16:44,447
Like, where's the price discovery mechanism?

1376
01:16:44,447 --> 01:16:47,167
It's the same as it is for illegal drugs, and now everything's

1377
01:16:47,167 --> 01:16:48,307
10 times more expensive.

1378
01:16:48,707 --> 01:16:50,487
Great, like, let's bring it on.

1379
01:16:50,497 --> 01:16:51,902
Like, Just do it!

1380
01:16:51,912 --> 01:16:55,772
Like, it's not They need to leave it alone completely, or they need

1381
01:16:55,772 --> 01:17:00,052
to go batshit insane and completely, like, make it all illegal.

1382
01:17:00,062 --> 01:17:02,832
The worst thing is this permissioned cucked.

1383
01:17:03,352 --> 01:17:06,882
That's like And that's where you're heading, because it's cheaper, and

1384
01:17:06,882 --> 01:17:11,092
it's easier, like Oh, I can do on chain Bitcoin, and then I've got, like That

1385
01:17:11,092 --> 01:17:16,462
was one time I had I did a DCA, and I had 45 UTXOs, and then I went to spend

1386
01:17:16,462 --> 01:17:20,552
it, and it was a high fee environment, and I wasted half of my, like, stacking.

1387
01:17:20,857 --> 01:17:25,137
Like in an on chain transaction, I don't understand what I'm doing, I need like an

1388
01:17:25,137 --> 01:17:28,927
exchange to do this for me, and there's, and don't worry, I just have to make an

1389
01:17:28,927 --> 01:17:31,907
account with these guys, and I upload a picture of my driver's license, and

1390
01:17:31,907 --> 01:17:36,207
today's date, and smile, or not smile, whatever the requirement is, it's like,

1391
01:17:36,207 --> 01:17:40,557
yeah, great, like, this is gold again, this is just, there's a reason we don't,

1392
01:17:40,597 --> 01:17:42,787
like, That we're saying this is gold 2.

1393
01:17:42,787 --> 01:17:45,107
0, like there's a reason for that.

1394
01:17:45,157 --> 01:17:47,817
Like, we know that if we went back to the gold standard, because the

1395
01:17:47,817 --> 01:17:50,407
fiat standard sucks, we know it will just end up as fiat again.

1396
01:17:50,797 --> 01:17:53,967
There's a way that that happens to Bitcoin too, and it's happening.

1397
01:17:54,417 --> 01:17:57,927
And I hate watching it, because it's such a disappointment,

1398
01:17:57,927 --> 01:18:00,907
it's such a betrayal of all the principles that created this project.

1399
01:18:01,287 --> 01:18:04,487
And it's like, it's always going to not be as good as it was with

1400
01:18:04,487 --> 01:18:05,917
like, a thousand cypherpunks.

1401
01:18:06,247 --> 01:18:09,252
It was always going to be a bit worse, but it's like, It's just

1402
01:18:09,272 --> 01:18:13,642
tanking at such a fast rate, like, and I, I just don't know of any

1403
01:18:13,642 --> 01:18:18,272
other method than hostile politicians that make life really difficult for

1404
01:18:18,312 --> 01:18:21,782
Bitcoiners who are then forced to go and become CoinJoin coordinators

1405
01:18:21,782 --> 01:18:24,092
and UTXO experts and all this.

1406
01:18:24,112 --> 01:18:24,392
Like,

1407
01:18:25,287 --> 01:18:30,287
we need to bring the optimism back here, I feel, so, so, so, yeah,

1408
01:18:30,472 --> 01:18:31,462
yeah, sorry about that.

1409
01:18:31,922 --> 01:18:32,812
There's enough of that.

1410
01:18:32,852 --> 01:18:32,952
I

1411
01:18:33,027 --> 01:18:36,717
no, no, no, but you, you need to, the, the night is darkest just before the

1412
01:18:36,717 --> 01:18:38,397
dawn and all of that, so, so, like.

1413
01:18:38,657 --> 01:18:46,127
I still have hopes we will win, I'm pretty sure we will, one way or another, like,

1414
01:18:47,837 --> 01:18:53,837
stuff like this helps, like, people are forced to listen to these perspectives

1415
01:18:53,837 --> 01:18:55,277
and like, do something about it.

1416
01:18:55,757 --> 01:18:57,207
Uh, I think that's great.

1417
01:18:57,367 --> 01:19:02,387
One, one, one point I wanted to make before, like to take this in a slightly

1418
01:19:02,387 --> 01:19:06,667
different direction, because I think people have gotten the point here,

1419
01:19:06,982 --> 01:19:08,432
Yeah, I'm sorry about all this.

1420
01:19:09,507 --> 01:19:10,277
no, it's nice.

1421
01:19:10,277 --> 01:19:10,367
I

1422
01:19:10,602 --> 01:19:13,842
sell your, everyone messages me after I do this and say, should I sell?

1423
01:19:13,842 --> 01:19:15,522
I'm like, no, obviously don't sell your Bitcoin.

1424
01:19:16,232 --> 01:19:17,802
There's still nothing else remotely as

1425
01:19:18,027 --> 01:19:18,427
No, no,

1426
01:19:18,682 --> 01:19:19,642
please don't take that from

1427
01:19:19,707 --> 01:19:21,537
you know, I, I like metal music.

1428
01:19:21,537 --> 01:19:27,907
I like darkness, like, so, so the other point we wanted to touch on is like, why

1429
01:19:27,907 --> 01:19:29,897
the fuck are you guys mining empty blocks?

1430
01:19:30,292 --> 01:19:30,992
Oh, that's fun.

1431
01:19:31,742 --> 01:19:33,502
Because it's better than mining no blocks.

1432
01:19:34,017 --> 01:19:34,397
All right.

1433
01:19:34,447 --> 01:19:35,177
And why is that?

1434
01:19:35,657 --> 01:19:38,857
Well, because if you mine no blocks, you don't even make the subsidy.

1435
01:19:39,667 --> 01:19:41,107
Not to give a Luke Jr.

1436
01:19:41,117 --> 01:19:45,497
style, unelaborated answer, but that's it, like, people don't understand

1437
01:19:45,497 --> 01:19:48,737
and, like, intuitively they go, there could have been transactions in that,

1438
01:19:48,737 --> 01:19:50,427
I'm like, that's not how it works.

1439
01:19:51,017 --> 01:19:54,797
Like I've seen people that run mining pools not understand this and it's, this

1440
01:19:54,797 --> 01:19:57,967
is the kind of part where I'm like I'm gonna start drinking again or something.

1441
01:19:57,967 --> 01:20:01,247
It's just so depressing that people that run like critical infrastructure

1442
01:20:01,257 --> 01:20:02,617
in Bitcoin don't get this stuff.

1443
01:20:02,927 --> 01:20:07,177
Like Poisson distribution, like an empty block is not a block

1444
01:20:07,227 --> 01:20:08,377
that could have been a full block.

1445
01:20:08,907 --> 01:20:11,857
It would, there would just wouldn't have been a block and

1446
01:20:12,347 --> 01:20:13,847
empty blocks are not useless.

1447
01:20:15,322 --> 01:20:19,182
Because if you've ever, if you open a Lightning Channel, by default, you're

1448
01:20:19,182 --> 01:20:21,602
waiting three blocks or six blocks after.

1449
01:20:21,872 --> 01:20:24,702
You know, it gets in a block, you still can't use the channel, it

1450
01:20:24,702 --> 01:20:28,682
needs to be in, every block gets confirmed by the block after it.

1451
01:20:28,882 --> 01:20:31,412
So if you find an empty block, it confirms everything.

1452
01:20:31,412 --> 01:20:34,152
It's more work for an attacker to do to reorg the chain, because there's

1453
01:20:34,152 --> 01:20:35,792
yet more work they have to replace.

1454
01:20:36,442 --> 01:20:40,432
Um, they're not, they don't, and they, resource wise, they're

1455
01:20:40,432 --> 01:20:43,702
fantastic, obviously, because they, they contain no data.

1456
01:20:43,712 --> 01:20:47,342
So, like, for a node They're the least annoying thing ever.

1457
01:20:47,672 --> 01:20:52,182
Obviously, you don't want loads of blocks to be empty, because, you know, that's,

1458
01:20:52,232 --> 01:20:56,712
that effectively makes there be less block size space, I mean, to be honest, that's

1459
01:20:56,722 --> 01:21:00,362
probably not a bad thing either, but someone's gonna cut this out of context.

1460
01:21:00,812 --> 01:21:03,452
The only reason, like, empty blocks exist is because you don't

1461
01:21:03,452 --> 01:21:05,312
want miners doing useless work.

1462
01:21:05,742 --> 01:21:10,747
And sending A block template full of transactions instead of an empty

1463
01:21:10,747 --> 01:21:14,527
block means they will just, the nature of that taking longer to get

1464
01:21:14,597 --> 01:21:18,467
to a bunch of ASICs means that they spend longer doing useless work.

1465
01:21:18,597 --> 01:21:20,147
So it's called the empty block speed up.

1466
01:21:20,477 --> 01:21:23,187
Like, you know, you, we, the network just found a new block.

1467
01:21:23,512 --> 01:21:27,212
As of this instant, all of the miners on my pool are now doing useless work

1468
01:21:27,232 --> 01:21:30,722
trying to find a block that already got found, or a competing block for that one.

1469
01:21:30,732 --> 01:21:34,182
I need to get them on new work immediately, and the only way I can

1470
01:21:34,182 --> 01:21:38,372
get, like a, this, this could be a tiny amount of data in the difference,

1471
01:21:38,392 --> 01:21:43,182
but, like, it's not, I'm not sending one chunk of data down one pipeline.

1472
01:21:43,212 --> 01:21:46,202
I've got 10, 000 ASICs connected to me.

1473
01:21:46,292 --> 01:21:50,082
Every byte matters here, so, you know, while there's packet size,

1474
01:21:50,082 --> 01:21:51,642
you do have, like, these notches.

1475
01:21:51,772 --> 01:21:52,042
But.

1476
01:21:52,542 --> 01:21:55,222
You know, people don't run the proxies that everyone thinks they do.

1477
01:21:55,282 --> 01:21:59,622
So, and miners like to mine in stranded energy scenarios where the internet is

1478
01:21:59,622 --> 01:22:03,752
not great, and they have hundreds or thousands of miners all pointed at a pool,

1479
01:22:03,752 --> 01:22:07,952
and I have to send a tiny bit of data to 10, 000 things over crap internet?

1480
01:22:08,232 --> 01:22:12,222
Yes, I need to save every single byte possible, because if I just don't do

1481
01:22:12,222 --> 01:22:15,682
the empty block and I do the full block, it might take another 300 milliseconds,

1482
01:22:15,822 --> 01:22:18,802
or like, sometimes multiple seconds.

1483
01:22:19,047 --> 01:22:22,087
And in a 10 minute race, multiple seconds add up.

1484
01:22:22,477 --> 01:22:27,697
And you can make miners do useless work for collective tens of hours every month

1485
01:22:28,187 --> 01:22:30,217
by not doing the empty block speedup.

1486
01:22:30,317 --> 01:22:31,637
And they don't hurt anything.

1487
01:22:31,877 --> 01:22:35,627
It just, they might become not worth it when subsidy is so low

1488
01:22:35,627 --> 01:22:37,367
and transaction fees are so high.

1489
01:22:37,877 --> 01:22:41,097
The, eventually, speedup.

1490
01:22:41,237 --> 01:22:44,477
But by then, all these big miners should be running proper proxy software anyway.

1491
01:22:44,627 --> 01:22:49,837
It is proxy, If there's a stratum proxy on the local site for the farm, then

1492
01:22:49,837 --> 01:22:54,037
you only need to send the slightly larger amount of data to one thing,

1493
01:22:54,047 --> 01:22:55,807
and then it deals with it all locally.

1494
01:22:55,887 --> 01:22:56,647
That's fine.

1495
01:22:56,737 --> 01:22:59,197
Then you don't need to worry about the m2box speedup, but a

1496
01:22:59,197 --> 01:23:00,657
lot of big minuses don't do that.

1497
01:23:00,677 --> 01:23:01,027
Okay.

1498
01:23:01,027 --> 01:23:03,657
I've, I've heard you talk about this on, on other podcasts.

1499
01:23:04,117 --> 01:23:09,902
We talked about the, the, um, the backdoor in the Bitmain, Miners, uh,

1500
01:23:10,087 --> 01:23:11,327
Oh yeah, this is fun.

1501
01:23:11,452 --> 01:23:15,832
also talked about on other pods, about, uh, about Bitmain deliberately making,

1502
01:23:15,832 --> 01:23:22,652
uh, the miners mine empty blocks for a longer time than necessary.

1503
01:23:22,652 --> 01:23:22,822
What

1504
01:23:22,832 --> 01:23:24,132
It's conjecture, right?

1505
01:23:24,162 --> 01:23:29,552
And I believe I wasn't over the top in this expose I wrote that, like, blew up.

1506
01:23:29,872 --> 01:23:33,732
Um, it's anyone else I'd give them the benefit of the doubt, but

1507
01:23:33,772 --> 01:23:36,692
because it's Bitmain, I'm like, yeah, it's probably malicious.

1508
01:23:36,712 --> 01:23:40,552
Like, so, this all kicked off because the understanding in the entire

1509
01:23:40,752 --> 01:23:45,037
Bitcoin space amongst even core devs like Matt Corallo, is wrong.

1510
01:23:45,047 --> 01:23:49,167
They don't understand why empty blocks actually happen, and it turns into

1511
01:23:49,167 --> 01:23:53,627
debate around why pools do the speed up, but not about why we manifestly

1512
01:23:53,627 --> 01:23:55,097
actually see so many get found.

1513
01:23:55,357 --> 01:23:59,367
Because, uh, Ocean's last block, we send out the empty template, this is

1514
01:23:59,407 --> 01:24:03,597
after we've verified the prior block, by the way, so the explanation is,

1515
01:24:04,167 --> 01:24:08,237
that's in the, the, the zeitgeist of Bitcoin is completely wrong.

1516
01:24:08,677 --> 01:24:13,407
It's, people, they are saying that, a pool, when it gets a block from

1517
01:24:13,407 --> 01:24:18,882
another pool, Before it verifies that it's a valid block, sends out new

1518
01:24:18,892 --> 01:24:23,962
work to its miners, and then once it's verified that the block is valid,

1519
01:24:23,962 --> 01:24:27,262
it, it, well, it updates, presumably.

1520
01:24:27,292 --> 01:24:31,372
But I mean, uh, or if it somehow discovers that it's not valid, it

1521
01:24:31,382 --> 01:24:33,832
then sends another update and says, oh, stop doing that work because

1522
01:24:33,832 --> 01:24:35,342
you're building on an invalid block.

1523
01:24:35,532 --> 01:24:39,307
This is This is not how any pool operates, because it's suicide.

1524
01:24:39,367 --> 01:24:42,407
You don't build a you could destroy a pool in ten minutes like that.

1525
01:24:42,427 --> 01:24:46,077
If I send to Foundry invalid blocks all the time, and it keeps sending

1526
01:24:46,077 --> 01:24:49,937
out work based on that, it's going to keep making its miners do useless

1527
01:24:49,937 --> 01:24:54,117
work, and it's and given how long it takes for miners to get old work out

1528
01:24:54,117 --> 01:24:56,277
of their system, that's that's suicide.

1529
01:24:56,287 --> 01:25:00,837
Like, you can have a a miner an ant miner will work for a minute, sometimes.

1530
01:25:00,837 --> 01:25:03,812
At, like, worst case scenario, They'll be working for a whole

1531
01:25:03,812 --> 01:25:05,962
minute on old work, right?

1532
01:25:05,962 --> 01:25:07,622
So, it would be suicide.

1533
01:25:07,622 --> 01:25:08,432
So that's not what happens.

1534
01:25:08,432 --> 01:25:12,352
In Ocean's case, and in any sensible mining pools case, and in all the pools

1535
01:25:12,352 --> 01:25:17,782
we've tested, when they send the empty block, they have already verified the last

1536
01:25:17,782 --> 01:25:25,582
block, but the and they already have most of the way there, the full block as well.

1537
01:25:25,932 --> 01:25:30,212
Like, they, they can, they can essentially send both of these things Because they're

1538
01:25:30,212 --> 01:25:33,752
both ready at the same time, but they still choose to send the empty template

1539
01:25:33,802 --> 01:25:35,422
because it will just get there faster.

1540
01:25:36,032 --> 01:25:39,062
And then they immediately, or basically at the same time,

1541
01:25:39,062 --> 01:25:42,572
follow up with the full template.

1542
01:25:43,082 --> 01:25:48,822
But the problem is, some chips on the miner are now working on the empty

1543
01:25:48,822 --> 01:25:52,552
template, and they don't just switch to the full template when they get it.

1544
01:25:52,942 --> 01:25:55,772
So, here's how the timeframe of it breaks down.

1545
01:25:55,892 --> 01:25:58,472
This Unfortunately I'm not doing a great explanation here, but

1546
01:25:58,472 --> 01:25:59,722
hopefully I'll clear it up.

1547
01:26:00,122 --> 01:26:05,452
So, you have, um, The pool has found a new network block.

1548
01:26:05,712 --> 01:26:08,182
It's verified that it's real, it immediately sends an

1549
01:26:08,182 --> 01:26:09,502
empty template based on that.

1550
01:26:09,812 --> 01:26:13,327
It doesn't It's not empty because it didn't want to put transactions

1551
01:26:13,327 --> 01:26:16,017
in there that might have been in the block it didn't verify before,

1552
01:26:16,017 --> 01:26:17,307
and thus mine an invalid block.

1553
01:26:17,457 --> 01:26:18,197
It's none of that.

1554
01:26:18,197 --> 01:26:19,757
It already knows all that information.

1555
01:26:19,757 --> 01:26:22,527
It already made sure that this is valid before it built on it.

1556
01:26:22,697 --> 01:26:24,707
It just wants to take advantage of the fact that the empty

1557
01:26:24,707 --> 01:26:26,047
template will get there faster.

1558
01:26:26,917 --> 01:26:32,087
Once it's done that, the, the antminer at the other end is still, it's going

1559
01:26:32,087 --> 01:26:34,627
to get a clean jobs equals true.

1560
01:26:34,627 --> 01:26:37,297
So you put true at the end of the stratum message, and that

1561
01:26:37,307 --> 01:26:39,057
makes it dump the previous work.

1562
01:26:39,077 --> 01:26:40,597
And this is really expensive.

1563
01:26:40,597 --> 01:26:45,267
The miner, the hash rate of the pool at that instant will completely tank.

1564
01:26:45,347 --> 01:26:48,797
All the antminers on the, on the pool will like, just, uh, what's

1565
01:26:48,797 --> 01:26:49,887
going on for a little minute?

1566
01:26:50,012 --> 01:26:52,362
it's doing something else than guessing a number.

1567
01:26:52,367 --> 01:26:56,147
it's very expensive and it's, it's hard on the hardware too, like you don't

1568
01:26:56,147 --> 01:26:57,827
want to keep doing that to hardware.

1569
01:26:58,077 --> 01:27:02,107
The clean jobs true is like a very expensive thing for a pool to do and

1570
01:27:02,107 --> 01:27:06,357
then within, within a couple hundred milliseconds, which is, you know,

1571
01:27:07,987 --> 01:27:12,517
tens of percent of a whole second, it starts to get itself back together and

1572
01:27:12,517 --> 01:27:14,007
start working on the empty template.

1573
01:27:14,357 --> 01:27:17,957
Then you send the full template without clean jobs true, because

1574
01:27:17,977 --> 01:27:19,387
true is really expensive.

1575
01:27:19,952 --> 01:27:23,412
And, the overall effect of it, again, this is all misunderstood.

1576
01:27:23,412 --> 01:27:26,052
It's really hard, because I'm not explaining a thing no one knows

1577
01:27:26,052 --> 01:27:28,562
about, I'm explaining a thing everyone has a wrong understanding of.

1578
01:27:29,212 --> 01:27:30,842
Um, which is like, really hard.

1579
01:27:30,872 --> 01:27:34,672
It's like explaining bitcoin to people that don't, you know, like it, for

1580
01:27:34,672 --> 01:27:35,992
some bullshit they heard in the news.

1581
01:27:36,352 --> 01:27:38,742
So, the full template comes along.

1582
01:27:39,507 --> 01:27:42,887
And it comes with clean false, because we're not doing that whole thing where

1583
01:27:42,887 --> 01:27:46,417
we nuke the Antminer for a second, and it like, struggles to find itself.

1584
01:27:46,707 --> 01:27:50,207
We say, alright, when it's convenient for you, switch over to this full

1585
01:27:50,217 --> 01:27:54,637
template, and Wattsminers and Reasonably Designed Miners, within a few

1586
01:27:54,637 --> 01:27:56,837
seconds, will switch over, completely.

1587
01:27:56,837 --> 01:28:01,752
But Antminers, we were finding, It just takes them a really long time if you

1588
01:28:01,752 --> 01:28:07,492
don't send clean jobs true to actually get this old template out of their system.

1589
01:28:07,582 --> 01:28:10,832
But the important point to realize is that the pool has long since

1590
01:28:10,842 --> 01:28:12,992
sent you an update for your work.

1591
01:28:13,092 --> 01:28:18,092
It contains transactions, but you're still working on the empty template.

1592
01:28:18,392 --> 01:28:19,872
So this was the criticism.

1593
01:28:19,902 --> 01:28:22,902
When a pool finds an empty block, everyone goes, Why hadn't the

1594
01:28:22,902 --> 01:28:24,582
pool sent a full template yet?

1595
01:28:24,812 --> 01:28:26,522
And we were saying, we had.

1596
01:28:26,882 --> 01:28:30,802
This empty block happened five seconds after we'd already

1597
01:28:30,812 --> 01:28:32,212
sent out a full template.

1598
01:28:32,212 --> 01:28:35,222
It's just the miner wasn't working on it yet, because they're not designed all that

1599
01:28:35,222 --> 01:28:37,172
well, they don't switch jobs that quickly.

1600
01:28:37,332 --> 01:28:40,362
And we don't want to run this expensive command that makes them just do

1601
01:28:40,362 --> 01:28:43,652
nothing for a little while, because it's a waste of the miner's effort.

1602
01:28:44,212 --> 01:28:47,332
It causes wear and tear on the hardware, and if it mines an

1603
01:28:47,332 --> 01:28:49,097
empty block, It's not that bad.

1604
01:28:49,387 --> 01:28:52,547
They could have made 10 percent more if it was a full block, but remember,

1605
01:28:52,887 --> 01:28:55,917
the alternative to an empty block is not a full block, it's no block.

1606
01:28:56,447 --> 01:28:58,697
So, this is, this, it's an entirely

1607
01:28:58,722 --> 01:29:02,342
but, but, but I think you said like, this was deliberate from, from

1608
01:29:02,342 --> 01:29:04,912
Bitmain's, um, side that they made

1609
01:29:04,957 --> 01:29:09,407
so to get into the controversy of it, right, we were like, so Watts miners do

1610
01:29:09,407 --> 01:29:15,137
a complete job change in max 3 seconds, um, and Ant miners would, the majority

1611
01:29:15,137 --> 01:29:18,487
of the chips would have switched in 3 seconds, but depending on where in

1612
01:29:18,487 --> 01:29:20,397
the cycle it is of grinding through.

1613
01:29:21,262 --> 01:29:25,702
Whatever it's doing to, I don't know where the ASIC boost part lies

1614
01:29:25,702 --> 01:29:30,742
in the circuitry or the like, just legitimately grinding nonce values.

1615
01:29:31,302 --> 01:29:35,132
It, depending on where it is in that process, one of the chips could just

1616
01:29:35,132 --> 01:29:40,102
be Still working on the empty template 30 seconds after you've already sent

1617
01:29:40,102 --> 01:29:43,172
it a full template and you've probably followed up with even more full templates

1618
01:29:43,212 --> 01:29:47,312
because pools keep updating, right, as new transactions show up, and they just

1619
01:29:47,312 --> 01:29:51,992
were doing old work for ages, and it makes pools look bad because it makes it look

1620
01:29:51,992 --> 01:29:56,732
like we're just slow to generate work when we're not, but the point is they released

1621
01:29:56,732 --> 01:30:02,057
a firm, like, We started explaining as Ocean why empty blocks happen, because

1622
01:30:02,117 --> 01:30:05,137
everyone thought, oh, it's just the pool, it's like being slow, like they

1623
01:30:05,137 --> 01:30:08,887
sent an empty template, and then they sent a full template, but before they

1624
01:30:08,887 --> 01:30:12,187
could do the full template, for whatever reason, someone found an empty block.

1625
01:30:12,377 --> 01:30:16,687
And we're like, no, in nearly all cases, everyone that found an empty block had

1626
01:30:16,697 --> 01:30:18,987
full work, it just wasn't doing it yet.

1627
01:30:19,402 --> 01:30:22,672
That's not the pool's fault, that's the, the, the hardware's fault.

1628
01:30:23,022 --> 01:30:26,412
And this, the minute this entered the fray, and we kept hammering home about

1629
01:30:26,412 --> 01:30:29,392
it, because we got blessed, if you want to look at it that way, with three empty

1630
01:30:29,392 --> 01:30:33,932
blocks, which is statistically impossible, like, not impossible, but very unlikely.

1631
01:30:34,232 --> 01:30:36,402
In all cases, it was not the fault of Ocean.

1632
01:30:37,157 --> 01:30:41,357
Because there was, in all three cases, the miners long since

1633
01:30:41,357 --> 01:30:42,867
had full work to be working on.

1634
01:30:42,927 --> 01:30:46,037
So everyone looked at Ocean and went, oh, it's because you fill a spam, so it takes

1635
01:30:46,057 --> 01:30:48,497
longer for you to verify incoming blocks.

1636
01:30:48,657 --> 01:30:50,117
No, of course that's not how it works.

1637
01:30:50,147 --> 01:30:55,477
We run a core, a core node which is aware of as many transactions as possible.

1638
01:30:55,667 --> 01:30:58,677
Spam doesn't make us slower to verify blocks than other

1639
01:30:58,677 --> 01:31:00,217
pools who don't fill a spam.

1640
01:31:00,427 --> 01:31:01,377
Doesn't work like that.

1641
01:31:01,557 --> 01:31:03,917
Any pool that gets a pool, a block from Mara pool.

1642
01:31:04,312 --> 01:31:06,962
Has to deal with a whole bunch of unfamiliar transactions,

1643
01:31:06,962 --> 01:31:08,202
and yes, it takes longer.

1644
01:31:08,452 --> 01:31:08,732
Right?

1645
01:31:08,792 --> 01:31:10,932
It's, that's just part of mining, right?

1646
01:31:10,932 --> 01:31:14,512
If you're the biggest pool, you don't need to do this verification

1647
01:31:14,542 --> 01:31:16,752
because you're building on top of your own block so often.

1648
01:31:16,892 --> 01:31:20,042
So, the biggest, this is one of the reasons we don't want big blocks, right?

1649
01:31:20,352 --> 01:31:22,892
Because, if you're the one that keeps finding the majority of the

1650
01:31:22,892 --> 01:31:25,992
blocks, everyone else has to spend like eight seconds downloading it

1651
01:31:25,992 --> 01:31:27,292
and verifying everything in it.

1652
01:31:27,402 --> 01:31:28,392
You get a head start.

1653
01:31:28,682 --> 01:31:29,722
So, I'm digressing.

1654
01:31:29,902 --> 01:31:35,952
The point was, you have, uh, Antminers doing this very slow process of updating

1655
01:31:36,382 --> 01:31:39,562
and then when we made all this noise about it and we started correcting the

1656
01:31:39,562 --> 01:31:43,732
narrative around why empty blocks happen and it's because Antminers suck, surprise,

1657
01:31:43,742 --> 01:31:47,132
surprise, yet another thing about them that's badly designed, they released

1658
01:31:47,132 --> 01:31:50,062
a firmware update for it and we were like, wait, this isn't a hardware thing,

1659
01:31:50,062 --> 01:31:54,452
this is a firmware thing that they have a fix for that they're releasing now.

1660
01:31:54,452 --> 01:31:58,492
This is very suspicious because what if they've been using this the whole time?

1661
01:31:58,492 --> 01:31:59,902
That would be a huge advantage.

1662
01:32:00,377 --> 01:32:01,767
They're going to be doing more.

1663
01:32:02,227 --> 01:32:04,927
The more up to date your work is, the more lucrative it is.

1664
01:32:05,147 --> 01:32:07,277
Especially in a high transaction fee environment.

1665
01:32:07,277 --> 01:32:11,937
If someone fat fingers a transaction fee, and, you know, every other pool

1666
01:32:11,937 --> 01:32:15,207
adds it to their template, but it takes 30 seconds for them all to start

1667
01:32:15,207 --> 01:32:16,477
updating, it's not going to be that long.

1668
01:32:16,487 --> 01:32:18,677
But if, you know, again,

1669
01:32:18,882 --> 01:32:23,032
more money than the other pools, so you get a market advantage over others.

1670
01:32:23,357 --> 01:32:26,627
the point is you're mining on better hardware than your competition, and

1671
01:32:26,627 --> 01:32:28,487
you're selling all of the hardware,

1672
01:32:28,642 --> 01:32:35,352
do you suspect these, them to be doing more like suspicious stuff?

1673
01:32:35,702 --> 01:32:39,902
Is it just the backdoor and the empty block thing?

1674
01:32:40,712 --> 01:32:43,692
Could there be other attack vectors from the hardware manufacturers?

1675
01:32:43,832 --> 01:32:44,102
But

1676
01:32:44,327 --> 01:32:48,417
Um, I mean, it's all closed source, and this is an adversarial environment,

1677
01:32:48,417 --> 01:32:54,862
so I'm never gonna say I mean, it's possible, and the likelihood is sort of

1678
01:32:54,862 --> 01:32:59,232
irrelevant, really, like, would we run Bitcoin Core if it was closed source and

1679
01:32:59,232 --> 01:33:03,192
binary only, and just be like, well, do we think Peter Wooller and, you know,

1680
01:33:03,192 --> 01:33:06,712
these people are malicious, like, it's just a silly conversation at that point,

1681
01:33:06,712 --> 01:33:11,302
I'm like, this, no, of course I don't trust Bitmain, right, like, I mean, but

1682
01:33:11,302 --> 01:33:15,362
I don't know, they're also, like, one thing I said in that expose thing that I'm

1683
01:33:15,642 --> 01:33:20,137
probably wrong about, that I would love to correct publicly, is the Covert ASIC

1684
01:33:20,167 --> 01:33:24,367
Boost, uh, allegation, because I took Greg Maxwell and what he said at face value,

1685
01:33:24,367 --> 01:33:26,297
which is, they're definitely using it.

1686
01:33:26,887 --> 01:33:30,117
And, it depends who you listen to here, but it looks like they

1687
01:33:30,117 --> 01:33:33,417
intended to use Covert ASIC Boost and couldn't actually figure it out,

1688
01:33:33,427 --> 01:33:34,567
because it's really complicated.

1689
01:33:34,877 --> 01:33:37,907
The hardware was totally designed for it, and they couldn't actually

1690
01:33:37,907 --> 01:33:39,397
do it at the software level.

1691
01:33:39,967 --> 01:33:41,347
And then, they never did it.

1692
01:33:41,557 --> 01:33:44,957
And then everyone hated them for probably doing it, even though

1693
01:33:44,957 --> 01:33:47,207
they probably actually never managed it, so it's like they had,

1694
01:33:47,952 --> 01:33:49,002
they had the intention.

1695
01:33:49,247 --> 01:33:52,827
yeah, they certainly had the intention, and I'm pretty sure it was a factor in

1696
01:33:52,837 --> 01:33:57,607
why they, uh, wanted, like, pushing for SegWit as a hard fork instead of a soft

1697
01:33:57,607 --> 01:34:01,892
fork is, like, completely illogical, it just, it breaks up the community,

1698
01:34:01,892 --> 01:34:06,997
it, it resets everyone's trust in what the network is, like, it, Ethereum is,

1699
01:34:06,997 --> 01:34:10,897
like, forever undermined by what they did with Ethereum Classic and Ethereum,

1700
01:34:10,907 --> 01:34:15,057
that's, like, That's a blight on that thing they will never recover from.

1701
01:34:15,357 --> 01:34:19,457
And like, trying to get Bitcoin to have that same compromise for no reason.

1702
01:34:19,877 --> 01:34:23,447
Like, the only reason it made sense was to be able to maintain COVA, AC Boost.

1703
01:34:23,757 --> 01:34:25,537
So I just assumed that they did it.

1704
01:34:26,047 --> 01:34:29,127
And that was a part of my rationale for assuming bad faith

1705
01:34:29,137 --> 01:34:30,517
with this firmware release.

1706
01:34:30,807 --> 01:34:32,437
So, again though, I want to reiterate.

1707
01:34:32,632 --> 01:34:33,922
That post was conjecture.

1708
01:34:33,942 --> 01:34:34,882
I don't have proof.

1709
01:34:34,922 --> 01:34:36,732
I don't know what would constitute proof.

1710
01:34:36,972 --> 01:34:40,302
Someone can decompile the firmware update and look if there's some

1711
01:34:40,302 --> 01:34:41,762
sort of smoking gun date in it.

1712
01:34:41,942 --> 01:34:45,212
If they had that update like a year ago, and they only released it after

1713
01:34:45,212 --> 01:34:48,242
all the noise around empty blocks, that would be a pretty good smoking gun.

1714
01:34:48,642 --> 01:34:50,742
But again, I'm not a mind reader.

1715
01:34:50,752 --> 01:34:52,362
It could just be a coincidence.

1716
01:34:53,582 --> 01:34:56,982
I don't, I don't, I'm not gonna give them the benefit of the doubt.

1717
01:34:57,442 --> 01:35:01,362
I'm like, it's possible that my, my, my hunch is wrong.

1718
01:35:01,892 --> 01:35:03,012
Benefit of the clout.

1719
01:35:04,522 --> 01:35:07,872
And all the, uh, and you, you said that it was statistically really unlikely,

1720
01:35:07,872 --> 01:35:09,142
but that's actually true, right?

1721
01:35:09,142 --> 01:35:12,442
There wasn't any reason for Ocean to have mined those three empty

1722
01:35:12,752 --> 01:35:17,822
Well, in all cases, as I said, the full template was already pushed out.

1723
01:35:17,942 --> 01:35:21,492
So everyone, like, the reason it could be the pool's fault that there's an

1724
01:35:21,492 --> 01:35:25,002
empty block is that it sent out an empty template, and then it couldn't

1725
01:35:25,022 --> 01:35:28,522
figure out the full template, or it just took too long to put it together.

1726
01:35:28,862 --> 01:35:31,672
And, like, you know, it might take us ten seconds to put together a

1727
01:35:31,672 --> 01:35:34,752
full template, and someone found a block after only five seconds.

1728
01:35:35,347 --> 01:35:36,957
Then you can go, this pool sucks.

1729
01:35:36,987 --> 01:35:37,977
Like, what are they doing?

1730
01:35:37,977 --> 01:35:41,457
Why aren't they caching enough transactions to be able to

1731
01:35:41,457 --> 01:35:42,937
verify blocks really quickly?

1732
01:35:43,167 --> 01:35:45,157
Like, why aren't they running sufficient infrastructure?

1733
01:35:45,807 --> 01:35:49,747
The minute the empty block happens after you've already issued the full template,

1734
01:35:49,797 --> 01:35:51,897
then it's the miner on the other side.

1735
01:35:51,997 --> 01:35:54,187
Maybe they have a network issue or something.

1736
01:35:54,492 --> 01:35:57,472
Like, I've seen empty blocks happen six minutes after the last block.

1737
01:35:57,902 --> 01:36:01,302
That can happen because there's just like a transient network issue or something.

1738
01:36:01,302 --> 01:36:03,452
Like one miner didn't get an updated template.

1739
01:36:03,722 --> 01:36:07,282
It can happen because the pool had a node go down, goes back up, and it

1740
01:36:07,282 --> 01:36:10,512
lost its mempool for some reason, and then it sent another empty template.

1741
01:36:10,802 --> 01:36:12,172
There are a whole bunch of reasons.

1742
01:36:12,512 --> 01:36:15,562
But, I'm just saying, all three of the empty blocks Ocean found,

1743
01:36:15,902 --> 01:36:18,842
in all three cases, we'd long since sent out a full template.

1744
01:36:18,902 --> 01:36:22,182
So it wasn't poolside that there was a, there was an issue.

1745
01:36:22,192 --> 01:36:25,092
It's not like we have a bad networking thing, or something like that.

1746
01:36:25,212 --> 01:36:29,192
It's, it's easy and intuitive to blame the pool, and it can be the pool's fault.

1747
01:36:29,292 --> 01:36:30,567
In our case, it wasn't.

1748
01:36:30,727 --> 01:36:31,807
Not in any instance.

1749
01:36:32,062 --> 01:36:36,282
I just wanted to reiterate that, and, uh, maybe it's time to take this into, towards

1750
01:36:36,282 --> 01:36:40,452
a soft landing, because we've already been going for a while, and, yeah, but, uh, um,

1751
01:36:40,652 --> 01:36:45,592
okay, so why does Ocean filter this spam?

1752
01:36:45,932 --> 01:36:52,122
Stuff, at least give the option in the, in the, uh, templates, and why should

1753
01:36:52,122 --> 01:36:53,772
miners consider mining with Ocean?

1754
01:36:54,257 --> 01:36:58,687
Um, not every miner wants to participate in the ongoing attack.

1755
01:36:58,757 --> 01:37:00,607
And they need an option to be able to do that.

1756
01:37:00,767 --> 01:37:03,607
And Ocean is the only option to do that apart from solo mining.

1757
01:37:03,837 --> 01:37:06,247
So no other pool has taken it upon themselves to do this.

1758
01:37:07,012 --> 01:37:10,672
heard about some other pool, like when this Dubai thing was

1759
01:37:10,672 --> 01:37:13,602
happening, there was talk about another pool doing a similar thing.

1760
01:37:13,852 --> 01:37:17,122
I don't remember the name of the pool, but like, but that would be

1761
01:37:17,287 --> 01:37:18,247
That would be amazing.

1762
01:37:18,332 --> 01:37:18,432
Yeah.

1763
01:37:18,487 --> 01:37:23,127
I would love to, you know, I'm not Competition is competition, but like,

1764
01:37:23,127 --> 01:37:25,997
if someone else would actually step up and do it, I would be very happy.

1765
01:37:26,517 --> 01:37:30,417
I'm doing what I do at Ocean because I think Bitcoin needs it, not because

1766
01:37:30,417 --> 01:37:33,897
it's like You know, I like having a job and an income and all that

1767
01:37:33,897 --> 01:37:37,987
stuff, but, like, you know, it is genuinely not the primary motivation.

1768
01:37:38,007 --> 01:37:41,207
Before I worked at Start9 or Ocean, I just had no job.

1769
01:37:41,257 --> 01:37:43,917
Like, I don't, I'm only gonna do something if it compels me.

1770
01:37:43,927 --> 01:37:46,897
Like, I'm not gonna go and work at, like, you know, some shitcoin

1771
01:37:46,897 --> 01:37:48,647
exchange just to earn more sats.

1772
01:37:48,657 --> 01:37:51,197
Like, it's just not, it's not necessary for me.

1773
01:37:51,197 --> 01:37:51,967
I don't want to do it.

1774
01:37:52,092 --> 01:37:54,382
Yeah, so, why, why do you want to mine with Ocean?

1775
01:37:54,422 --> 01:37:57,022
Because you don't want to actively attack the network, which is what

1776
01:37:57,032 --> 01:37:58,742
everyone's doing by default at the moment.

1777
01:37:58,822 --> 01:38:01,762
If you want elaboration on what the nature of the attack is, that's

1778
01:38:01,762 --> 01:38:03,482
a whole podcast in itself, right?

1779
01:38:03,702 --> 01:38:06,772
Like, we have spam filters in Bitcoin, we've had them forever,

1780
01:38:07,162 --> 01:38:08,502
It's never been censorship.

1781
01:38:08,722 --> 01:38:10,142
They don't work at the moment.

1782
01:38:10,192 --> 01:38:13,372
Ocean fixed them, so now it's just what it always was.

1783
01:38:13,812 --> 01:38:17,542
The unwillingness to fix these things comes from ignorance or confusion

1784
01:38:17,542 --> 01:38:21,462
or, you know, just gaslighting from spammers and David Bailey

1785
01:38:21,462 --> 01:38:22,772
and all these fucking assholes.

1786
01:38:22,942 --> 01:38:26,112
So it's like It's just, like, that's all it is.

1787
01:38:26,112 --> 01:38:30,352
And it doesn't, it, there's no, the context of it, beautifully,

1788
01:38:30,372 --> 01:38:33,262
as it always is with Bitcoin, if you're, like, principled and awesome

1789
01:38:33,262 --> 01:38:36,452
as a person, you make more money than shitcoiners and scammers,

1790
01:38:36,452 --> 01:38:37,932
they actually end up doing worse.

1791
01:38:38,172 --> 01:38:43,242
So, in the context of how mining works at the moment, Ocean is way more lucrative

1792
01:38:43,342 --> 01:38:45,612
for miners, which is really weird.

1793
01:38:45,662 --> 01:38:47,212
There are some caveats to that.

1794
01:38:47,557 --> 01:38:52,647
Um, but here's, here's like the sort of, the, the, the amazing layout of it.

1795
01:38:52,657 --> 01:38:54,417
So Ocean found three empty blocks.

1796
01:38:55,027 --> 01:38:58,837
At least 10 percent of what you could have got in a full block is gone because

1797
01:38:58,837 --> 01:39:00,177
the transaction fees aren't there.

1798
01:39:00,657 --> 01:39:01,457
We missed out.

1799
01:39:01,487 --> 01:39:05,717
We had incredibly bad luck during December 2023 and the halving.

1800
01:39:05,737 --> 01:39:09,597
We didn't find a single block during those two historically the highest

1801
01:39:09,607 --> 01:39:11,237
fee environments in Bitcoin's history.

1802
01:39:11,267 --> 01:39:13,237
We didn't find a single block in those periods.

1803
01:39:13,827 --> 01:39:16,567
Um, our luck at the moment is way below 100%.

1804
01:39:17,577 --> 01:39:21,702
Despite all of these things, Ocean miners have come out way ahead of

1805
01:39:21,702 --> 01:39:25,242
what they were paid in competing pools with Bob Burnett run his analysis.

1806
01:39:25,262 --> 01:39:28,682
He had 10 machines pointed at Ocean, 10 machines pointed at FPPS

1807
01:39:28,702 --> 01:39:32,992
pool 1, who will remain nameless, FPPS pool 2, and FPPS pool 3.

1808
01:39:33,202 --> 01:39:36,972
Not going to name names, but well known, respected pools that

1809
01:39:36,972 --> 01:39:41,252
everyone is using, despite Ocean having, and spam filtering, right?

1810
01:39:41,262 --> 01:39:44,752
So in, there's gonna be a transaction or two out there that is just a

1811
01:39:44,902 --> 01:39:48,962
shit ton of fake, Tapscript, or whatever, and it pays a whole high

1812
01:39:48,962 --> 01:39:51,662
transaction fee and it doesn't end up in Ocean's default template.

1813
01:39:52,192 --> 01:39:55,762
Despite all of these factors, Ocean Minus came out above.

1814
01:39:56,232 --> 01:39:59,072
So, that fact, like, we were shocked by that.

1815
01:39:59,112 --> 01:40:02,572
Because I knew there was some, some, some fuckery afoot, but I didn't

1816
01:40:02,572 --> 01:40:05,037
think it was going to be anything, like, as significant as that.

1817
01:40:05,732 --> 01:40:10,942
So, so, like we've said before, in conclusion, like, if, uh, if

1818
01:40:10,942 --> 01:40:15,172
you're a miner, be a miner, don't be a hash salesman and point your

1819
01:40:15,172 --> 01:40:19,612
node, no, point your miners to, um, to ocean and, uh, do the thing.

1820
01:40:19,612 --> 01:40:20,862
So you can see what's going on.

1821
01:40:20,872 --> 01:40:23,702
Otherwise you're probably getting fucked like, yeah,

1822
01:40:23,757 --> 01:40:24,407
yeah, you are.

1823
01:40:24,447 --> 01:40:29,067
Like, I mean, the only, there's a massive disadvantage to the ocean temporarily,

1824
01:40:29,677 --> 01:40:33,727
which is that we have very low hashrate, which means our variance is awful.

1825
01:40:33,737 --> 01:40:35,707
We'll go for weeks without blocks.

1826
01:40:36,137 --> 01:40:38,777
And that's impossible for some people to deal with, and

1827
01:40:38,777 --> 01:40:39,997
I sympathize with any miner.

1828
01:40:40,542 --> 01:40:42,102
That is like, oh, I get it.

1829
01:40:42,152 --> 01:40:44,302
I'm even ideologically aligned with you guys.

1830
01:40:44,302 --> 01:40:47,542
I just can't, I can't be two weeks late to pay my electricity bill.

1831
01:40:47,832 --> 01:40:50,792
This won't be a problem if we grow, but it's a chicken and egg problem.

1832
01:40:51,232 --> 01:40:54,302
And it's, it's dismaying, because it's very hard, like, you gotta

1833
01:40:54,312 --> 01:40:55,932
reach escape velocity as a pool.

1834
01:40:56,282 --> 01:40:58,192
We almost did, and then we didn't.

1835
01:40:58,487 --> 01:41:02,177
Because, you know, it just didn't take off the way it might have done.

1836
01:41:02,607 --> 01:41:05,177
And so now we're grinding out there trying to get that

1837
01:41:05,207 --> 01:41:07,257
bootstrapping problem finally solved.

1838
01:41:07,277 --> 01:41:10,417
We're nowhere near a year in, so it's not been long.

1839
01:41:10,837 --> 01:41:11,937
And, you know,

1840
01:41:12,222 --> 01:41:17,002
but the solution is that everyone who can't afford it pretends that they

1841
01:41:17,002 --> 01:41:18,752
afford it and just does it anyway.

1842
01:41:18,752 --> 01:41:20,322
Unless connects to ocean and the.

1843
01:41:20,732 --> 01:41:21,822
But you get the hashing

1844
01:41:22,047 --> 01:41:25,567
yeah, like, if everyone, like, made an irrational choice,

1845
01:41:25,567 --> 01:41:26,747
it would become rational.

1846
01:41:26,767 --> 01:41:29,907
That's like, yeah, like, it's, but it's chicken and

1847
01:41:30,052 --> 01:41:33,882
it's like playing, uh, playing Prisoner's Dilemma over and over again.

1848
01:41:34,392 --> 01:41:37,562
Because like, if you play it one time, you're supposed to defect,

1849
01:41:37,562 --> 01:41:40,722
and if you play it over and over again, you're supposed to Cooperate.

1850
01:41:40,762 --> 01:41:43,552
Read our upcoming book for an explanation of the Prisoner's Dilemma.

1851
01:41:43,992 --> 01:41:44,562
Exactly.

1852
01:41:44,652 --> 01:41:45,212
All right.

1853
01:41:45,372 --> 01:41:49,362
Anyway, yeah, go to Ocean X, Y, z to, to see what you're doing.

1854
01:41:49,362 --> 01:41:51,282
Anywhere else you wanna send our listeners?

1855
01:41:51,332 --> 01:41:55,522
I guess Twitter, but I mean, I'm not going to read an end pub out on here.

1856
01:41:55,902 --> 01:41:57,162
Like Nostr is great.

1857
01:41:57,172 --> 01:41:59,572
Like I'm starting to become a Nostr Max Hille.

1858
01:41:59,832 --> 01:42:01,782
are we, we we're like hypers,

1859
01:42:01,892 --> 01:42:02,352
yeah, yeah.

1860
01:42:02,352 --> 01:42:02,752
It's really

1861
01:42:02,982 --> 01:42:04,527
hypers fight or whatever.

1862
01:42:05,922 --> 01:42:06,642
, so, yeah.

1863
01:42:06,842 --> 01:42:07,642
That's awkward.

1864
01:42:08,097 --> 01:42:12,977
And if, if you haven't seen them, look at, check out Mechanic's other

1865
01:42:12,977 --> 01:42:16,867
interviews, an excellent one with McCormack a couple of weeks ago, a

1866
01:42:17,152 --> 01:42:19,932
A couple of months ago now, but absolutely fantastic interview,

1867
01:42:19,997 --> 01:42:20,677
yeah, that

1868
01:42:20,832 --> 01:42:21,352
Thank you.

1869
01:42:21,382 --> 01:42:22,412
That was a fun one.

1870
01:42:22,637 --> 01:42:26,027
and, uh, so was this one, so, thank you very much, yeah,

1871
01:42:26,082 --> 01:42:27,112
Always a pleasure, man.

1872
01:42:27,127 --> 01:42:27,597
to the conference.

1873
01:42:27,782 --> 01:42:29,252
And don't, don't sell your Bitcoin.

1874
01:42:29,362 --> 01:42:30,372
It's, it's fine.

1875
01:42:30,402 --> 01:42:31,112
It's going to be fine.

1876
01:42:32,252 --> 01:42:33,652
This has been the Freedom Footprint Show.

1877
01:42:33,872 --> 01:42:34,562
Thanks for listening.

1878
01:42:34,562 --> 01:42:35,302
Thanks again, Mr.

1879
01:42:35,302 --> 01:42:35,792
Mechanic.