Giacomo, welcome back to the Bitcoin Infinity Show. Nice to have you here.
Knut, thank you for having me back.
Yes, we have covered the pros and cons of both NOTS and BIP110 here on the Infinity Show a couple of times.
We have several people from both sides.
And I wanted to hear your take.
You're officially opposed to BIP110, I hear, which is funny because I'm officially pro-BIP110.
So let's dissect maybe the first time we have a difference of opinion in anything.
Yeah.
Not entirely true, maybe.
There have been other cases, but they were always very productive.
I think in this case as well, we also had the privilege to start agreeing because we both came from the same anti-spam kind of rents two years, three years ago.
So we started from the same position. And so it's easier to assume good faith, which I notice is always a very, very hard thing to do when two people come from completely different assumptions. They don't even acknowledge that the other position exists. Then there is a cultural shock of meeting the other position, which is so outrageous that it must be caused by some conspiracy or some ill intent.
And in our case, I think it's pretty, we discussed these, we went back and forth, both together, sometimes discussing together on many issues and sub-issues.
So I think it's easier for us to still man each other's position.
Yeah, absolutely. And I know you had a long call with Hodlonot the day before he was on, and I had a long talk with him.
and you sort of convinced him to, I mean, he contacted you.
That's a good thing to remind people of.
And you sort of convinced him to be against BIP-110.
And now it seems like he's back to supporting it.
Yeah, my evil influence is not durable.
It's only temporary.
I would have to recontact him right before the activation
to make sure my influence.
Yeah.
So let's see about the framing here.
So I think we both agree. And I mean, don't hesitate to interrupt me if I'm wrong in any of these assumptions. But I think we both come from a place of that Bitcoin is money, that that is the use case, and that all other use cases that are built on top or all that they should also like the only time that they're sort of morally justified.
when they make Bitcoin better money, such as Lightning, for instance, being built on top,
anchoring itself to the base time chain.
Yeah, I interrupted you just to maybe change the example because Lightning is a clearly
monetary application on top. It's needed for money. It's making Bitcoin better money. I think
that there are other applications that are clearly non-monetary, which can still make Bitcoin better
money for other reasons, for example, even if very marginal. For example, if you take something
like OpenTestamps, it adds potentially absolutely zero head, basically overhead to node operators.
So it doesn't interfere seriously with the operation of the monetary function, but it
can increase a little bit the demand for block space, which can be considered something
useful for the monetary, for the resistance to reorgs and fee sniping.
It's very, very marginal, but it's a good example of something that doesn't hurt and
can help. Another way can help besides this kind of argument about the fees is helping the
acceptance of the Bitcoin infrastructure within the context of traditional system integration.
So I've shielded open timestamps a lot and I find it a use case, which is a typical example
of non-monetary but good. Yeah, I think here is where we
we're already here.
I think our opinions slightly differ.
So, like, let's dissect this from the very bit.
So, open timestamps, I think this is,
and correct me if I'm wrong here,
but I think the reason that op return was set at 42 bytes
in the beginning, it was later increased to 83, right?
Standardness, yes.
Core, at least.
We have to be super pedantic about this because...
Yeah, yeah, yeah.
The standard policy.
So, it was never in the consensus
where you could set it to whatever you want,
but the standard or the default was 43 or 42 up until.
And the reason it was 42, if I'm right about this,
is that a hash of a document or a hash of anything really only took 42 bytes.
Let's say something plus an identifier.
So the idea was you can just put an identifier like this is a hash of this service plus the hash itself.
yes and and 42 42 bytes it's extremely small and what you could do with that was prove that
something existed at a certain point in time you can correct me if i'm wrong but can you do anything
else really with in terms of proving something than the existence of that thing no like it's
it's very this is a very important distinction open timestamps and timestamping and merkel
routes in general are just proof of existence. They are not proof of not existence. That's the
reason why they scale so well, because one single hash can prove the existence of millions of
documents, because you just create a Merkle tree, and you just publish the Merkle route, and you keep
the Merkle path, and you can prove the existence of billions of documents. Ricardo Casatta and
Peter Todd timestamped the entire internet archives with metadata in one Bitcoin transaction. So
So timestamping is super scalable and it's private in the sense that you don't leak any
information about the documents.
On the other hand, to prove something more like the non-existent of some competing transaction,
that's the hard part.
And that's why we need Bitcoin, where every node has to download every transaction made
by any other nodes forever.
So the unscalable part of Bitcoin comes from the proof of publication or proof of non-existence
or proof of non-contradiction, you can call it in different ways.
Todd calls it single-use seals.
But you're right that the timestamping is only doing proof of existence,
which is super scalable and super low.
So let me see if I understood that.
Proof of non-existence is way harder than proof of existence.
Yeah.
Yeah, correct.
Which might be why some people are religious and some are not.
anyway this is and and then you said that this this can at least theoretically create some more
demand for block space usage or for bitcoin usage really it's a very weak argument this one about
the demand is non-zero i think but very weak mostly because it creates a demand but which
so what does the demand it creates more fees for miners that creates more incentive to mine blocks
that create a higher cost or basically reorg in the chain.
So it gives you more security faster.
But then again, to enter the block, now you have to spend more to compete with this demand.
So you're basically back from the start.
I don't want to say this effect is zero, but it's very negligible.
If OpenTestTEMP had either even a very small cost on Bitcoin, I would consider it a waste.
Luckily, it has potentially zero cost because not only you can stamp the whole world with
one op return, but you can stamp the whole world with zero op return with something called,
for example, pay to contract or sign to contract and now with Taproot and Tapret.
So you can do that with zero byte on the blockchain.
The reason that I would consider it bad is because if it didn't provide any benefit is
because there's still some spammy level, which means that you have to do a transaction.
So if nobody wanted to do a transaction and you want to timestamp something, you can do
it with zero byte on top, but you do have to make a transaction, which maybe you were
not going to do if there was not a timestamp request.
So we cannot really say in full honesty that timestamp has zero footprint, but it's very
negligible.
As long as somebody is transacting in blocks, then you can use any transaction to timestamp infinite amount of data virtually for zero cost.
So would it be fair to say that the footprint is negligible?
I can never say that word.
Negligible.
Careful because it could be canceled.
It's N-word.
Let's say the N-word.
but that could also be said for the increased block space demand which would also be very small
so so like the the they sort of cancel each other out they do plus so i think it's more than that
so the the impact is virtually zero the the increase in fear rate that could help the security
is non-zero, but is small. And then it also outcompete your transaction to enter the security
model. So it basically cancel out. Yeah. All right. So that's, I mean, here's the other point
I'd like to address about this. And this is the security budget thing, right? So I see a lot of
Bitcoiners take it as a fact that it's good for Bitcoin if miners make more money. And I don't
necessarily agree with that because we have the difficulty adjustment algorithm, which sort of
ensures that this is always as close to a zero-sum game in terms of like the margins are always super
small for miners and they're supposed to be because you get the competition anyway. And I mean,
for now, like still most of the revenue is from the subsidy, right? Yes. And not the fees. I heard
somewhere i think it's this shit coin semi shit coinery podcast where someone said like the the
the ordinals and the brc20s are like two percent of minor total minor revenue by some by some
calculation at this point uh however like bitcoin is already all orders of magnitude more secure
than it needs to be arguably because like we have what is it petahashes now like how many are there
If you realize how many guesses per microsecond that is, it's just an enormous number.
So I don't get at all why people would want miners to make more money.
I don't really see that.
Do you agree?
I agree with you.
I think the whole security budget discussion is severely flawed because it assumes that
either Bitcoin has some specific hash rate or somehow it doesn't work, it breaks.
It doesn't break.
What there is is a continuity of cost.
So how expensive is it to unroll or to basically reorg one block?
How expensive it is to do two or three or four?
This is a linear cost growth that can become exponential if you compete with the rest of the network.
The probability basically decreases exponentially to have success.
And the amount of this decrease, the strength of this exponential depends on the total hash rate.
But the point is that if the hash rate is low, that just means that you have to wait more to reach the same level of security.
You just need more confirmation.
So there's never a breaking point in which you don't have security anymore.
And there is a circular argument there because if people don't want to pay for on-chain security,
so if people are not leaving fees to miner, that means that people don't need on-chain security fast.
Maybe because the second layers are so good that they don't need it.
If they don't need it, we cannot say it's an emergency that you have to wait more to reach the same level of immutability.
So I think it's a circular argument, the one about the security budget.
I think Luke Dasher has an argument here too about miner centralization, that that basically needs that if blocks are mined by the same cabal of miners, you need to wait for more blocks.
We have one hash per second or three exahash doesn't change anything. If you don't have competition, the amount of hash rate doesn't matter.
Yeah, so we basically have the same opinion on payments to miners and security budgets. So that's out of the way now.
That's it. That's just as a caveat, but it will not change the discussion anyway, but I just want to say that for accuracy. I buy the Eric Voskul argument that fees should eventually overcome subsidy. That's a good thing. So I want not high fees, but I want fees that are higher than the subsidy.
The reason for that is that the subsidy is not censorship resistant while the fees are.
Meaning, if the government is paying miners to create empty blocks or blocks with just a Coinbase but with zero transaction or only with off-back transactions,
the miners are not forfeiting the subsidy if they do that, but they are forfeiting the black market fees.
So the only defense by the black market is to increase the fees until the miners will
capitulate because the fees are more than the cost of being kidnapped by the government
or the subsidy by the government to censor Bitcoin.
So that's a good argument.
So the fact that halving is important and inflation should go down to zero And this is an argument actually against tail emission and stuff like that So it good that subsidy goes to zero
And it's also good that fees take over.
But we don't need an absolute level of high fees for some reason.
No, and the question here, like with so many other things in Bitcoin,
is a question of when and when it's necessary.
and it might not be necessary for the next 100 years.
Like, who knows?
I mean, I find that the biggest flaw in the argument about security budget
is thinking that Bitcoin will not double in value every four years.
If it does, then the problem goes away
because the miners get paid exactly the same, like in fiat terms, at least.
Yeah, in this case, I'm actually sad.
That's all the halving does.
I'm actually sad that Bitcoin will probably more than double every four years.
And so we will not have fast enough.
No, I'm joking.
But I think that eventually it's good that the subsidy gets completely overruled by the fees.
And that's a part, I think it's part of the censorship resistance design of Bitcoin.
But you're right.
It could not happen for many, many years.
No, and how could it not?
I mean, at some point you get into a scenario where you are incentivized to mine, not for the rewards, but simply to secure your own stack, right?
Do you buy that theory too?
Well, no, not really.
I mean, the personal incentive for a miner to mine, to just secure your own stack is very, very marginal.
In the sense that if nobody's mining, then what you want to prevent is from people to re-orging before you received your stack.
So as long as people will not really push this kind of, let's say that you have two years or 10 years of hodling,
the idea that you are mining to prevent a 10 years re-org seems a little bit broken to me.
If miners can do a 10-year reorg, probably that's already something where probably something I don't like, but something extreme as checkpoints may emerge from the market as a response.
Yeah. Can we see the current hash rate?
Yeah, 953.32 exahashes per second.
And to just give people a picture in their mind of what an exahash is.
So exah, how many zeros is that?
Exa is, so it's giga is nine.
Terra is 12.
12, so Exa.
Petra is 15, Exa would be 18 zeros.
So 953 followed by 18 zeros, guesses on the correct hash per second.
It's a ginormous number.
It's like by far the most secure thing on earth in that sense.
So I think the fears about miners not getting paid enough is very exaggerated, given the fact that they are mining and doing a lot of it.
So the second point there, and we're still on the first base layer here, is that things like the Lightning Network are monetary use cases, so therefore they're legit.
And here I might have a contention or two, and that is that if it now turns out that SegWit and Taproot led to this spam attack and that in the long run that leads to the slippery slope that will turn Bitcoin into ETH 2.0 and kill the entire thing, then Lightning wasn't worth it.
And how do we know that? Well, we can't until after it's happened. So while I love Lightning and the fact that I'm able to use Bitcoin in a very convenient way, I still think velocity of money is a very Keynesian metric to use when evaluating whether something is good money or not.
Well, slow down a little bit because I think you're packing a lot of assumptions into this, including the connection between these soft forks and the spam attacks, which is something, it's a valid link there.
There is for sure some facilitation, especially I think from Segwit discount, but we can analyze that better.
Then you're moving to the fact that this attack will basically bring this etherification of Bitcoin, which is something that I think we should analyze a little bit better in the specifics.
and then the death of the entire thing,
which is a very extreme kind of assumption, a final assumption.
I agree that the velocity of money is not the main point
and I agree it could be achieved just by the original Hal Finney vision
of having custodials like cypherpunk, anonymous custodials,
just doing stuff, eventually rug pulling people here and there.
But overall, it can work better than gold
because gold was very costly to settle while Bitcoin is less costly.
So you could have this kind of banking system on top of Bitcoin,
which is what Alfini was imagining.
But the thing is that with Lightning,
you can have with Lightning and other layer two within the Lightning network,
you can have this kind of like have your Kate and ET2 or the opposite,
which is basically almost same secure, good security,
comparable to Bitcoin plus also some velocity of money if you really need it.
And I think that the point is that people only see lightning as an improvement in velocity
or like speed, small payments, cheap, small, fast payment.
That's true.
But lightning also does other two things.
First, lightning is objectively more private, can be objectively more private.
And second, lightning can be more censorship resistant.
You can have a lightning transaction happening even if miners collude to sensor blocks for years.
Channels that are already open and ARCs that are already open can, well, not really ARCs, channels that are already open can go on working.
And lightning can also work if the internet is basically cut off of the nation for a few years.
Of course, you cannot open channels, you cannot close, so you have security issues and raise conditions, but lightning can work.
So I think the lighting is an example of not really wanting to pursue velocity.
The thing is, lighting is a patch on a bug of Bitcoin, which is a necessary bug, which
is unresolvable at the fundamental level, but can be mitigated.
And the bug is called global consensus.
Bitcoin system that which assumes that all the nodes have to download information that
they don't directly need, but just to stay in sync with all the other nodes.
So every time one node does something, a transaction, all the other nodes need to record it forever.
This in itself is a censorship problem, privacy problem, and scalability problem all packed together.
I think Lightning is an example of minimizing this, which is also at the very root of the spam problem.
Yeah, and the fact that fees are low at the moment is, I think, a huge part of that is because Lightning works
and people are using it and not
transacting on the chain.
So we agree there
on all points
I'd say.
Well, in the
case, I mean, I think
we disagree here unless I
manage to change your mind a little bit because I see
Lightning as not only monetary
but I see that as a completion
like a fixing of the monetary
issues of base layer. So base
layer I think is bad money
in general. Of course we need it
to settle big amounts and to open channels and to close channels.
But I think that Lightning fixes a fundamental flaw in Bitcoin design,
which is global consensus.
So maybe this position is a bit stronger than the one you were starting from.
No, I totally agree with that position.
And I was about to go there that, like, especially the privacy route,
that that is like one of the real benefits of Lightning.
I'd just like to point out that the whole velocity of money thing
might not be the biggest, the best argument for it.
or the best metric. So in the future, like, and here we sort of come to the meat of the thing,
because I know I've met them in Logano, you hang out with a lot of developers,
and they have a lot of ideas about what to do with atomic swaps and this and that,
and using all of these fancy code salad things to allegedly improve Bitcoin as money.
And the way I see it is like, where do you draw the line between a shitcoin use case and an actual
monetary use case. And I, for instance, I don't think stable coins should be built on Bitcoin
if they leave a footprint, because the footprint will be there forever, and thereby making it
costlier to run a node and therefore making Bitcoin a worse form of money. And a stable coin
is really just fiat. So I don't see a good argument for ever wanting a stable coin to be
even anchored to Bitcoin.
But what would,
I think this is somewhere
where we disagree.
What would you say?
Well, I'm not even sure
we disagree so much here.
I have a very, very,
usually I tend to have
very strong opinions,
but on these,
I have a very nuanced opinion
in the sense that I,
I see a fundamental problem
with stable coins.
So fiat denominated credit,
fiat denominated credit,
which is traded permissionlessly
to some degree on a secondary market.
So what are stable coins?
It's fiat credit.
But instead of being on a database like PayPal or Venmo, this fiat credit uses the blockchain rule.
So if you have a database like Venmo or PayPal and you try to allow an underage Nigerian boy moving money, then PayPal will stop you because the government will stop PayPal.
If you do the same with USDT, the government will try to tell Tether to stop and Tether will say, oh, it's a blockchain.
I only control the primary market.
This is the secondary market is happening on an open protocol, which is decentralized.
I can do nothing about that.
So it's a blockchain scam.
Now, do I like blockchain scams?
No, traditionally, I despise them because they take what I love, which is Bitcoin, and they
use Bitcoin to generate confusion, which is the opposite of what I love, which is education
on Bitcoin, in order to profit.
So I dislike shitcoins.
But this specific shitcoins is a shitcoin which is not aiming at defrauding investors
because it's not promising any gain.
You give me a dollar and if you're lucky, you get back a dollar minus the fees.
So it's not a get rich quick scheme.
It doesn't defraud investors, but it does defraud regulators.
Now, when a scam, which is using the thing I love, which is blockchain,
Bitcoin, in order to create a buzzword like blockchain,
to confuse and scam things I don't love, like regulators,
in that case, I become a little bit more sympathetic.
I can still see that somebody may be adversarial towards this scam towards the government, mostly because it's taking some energy out of Bitcoin, like mine share liquidity.
We say that one of the reasons fees are low is that there is lighting.
That's true.
But the other is that there is stable coins.
So many people that would be using Bitcoin instead and also learn about inflation resistance are stuck with fiat credit because it's just more familiar.
It has less volatility in the short term.
So it's a better brand recognition.
So I agree with you that stable coins are problematic, to use a woke term, and I will
not have any problem with a Bitcoiner having a strong stance against them.
I'm more tolerant.
I agree with you that if such a problematic use case is taking any resource out of Bitcoin,
it should be opposed in any realistic way.
But some things, some ways to do this stuff, not only doesn't consume Bitcoin's resources, but it can add.
For example, the things I tried to work on a little bit, a few years with RGB is USDT on Lightning.
Now, USDT on Lightning, there is an old talk by Maxim Molloski in Berlin Conference 2018, the first Lightning Conference.
It increases liquidity and privacy for Bitcoin lighting users because right now, let's say that I want to pay you.
There is a liquidity gap in our path.
If there is a USDT-based connection, now you can have USDT routing that will help the SAT routing and vice versa, of course.
Plus, you have more privacy because the chain analysis look at the opening of a channel and the closing of a channel.
if they also have to consider that maybe there is some invisible USDT transfer across the channel,
all the heuristics to analyze also get disrupted.
So the USDT on lighting specifically is a way to basically to do three things.
Improve lighting liquidity, which is good for Bitcoin users.
Improve lighting privacy, which is good for Bitcoin users.
and reduce the credibility of the base layer sheet coins that Tether is using right now,
like Solana, Polygon, Ethereum, which gets legitimized.
Actually, I will say something controversial, especially as somebody paid by Tether.
Tether kept sheet coins alive the last cycle.
If not for USDT, sheet coins may be way more dead than they are.
So that a bad thing Tether moving ESDT to Lightning will help Lightning users and will also to some degree help destroying the direct competitors the long competitors to sets which are Solana
and Tron. And those are also scams created to scam the investor, not the regulator. Well, both,
but more importantly the investor.
Okay, so here I take a more purist point of view, I guess,
because first of all, I sort of like the shit coins
in the sense that they're not messing with Bitcoin.
And also, there's a comparison here to,
I think it's Rothbard, it could be me,
he pointed out that other use cases for gold
than just the medium of exchange use case
are actually making it a worse form of money.
So when it's used in industry or as jewelry, it gets mispriced.
And this is something I fear could happen to Bitcoin too.
If you introduce these rails and you say it provides liquidity,
yeah, but if the liquidity is based on a bubble,
then that might just lead to more confusion and more volatility.
And there might be side effects we don't see here.
I get that it's a trade-off,
but also I'd like to take the point of view
of the Nigerian boy
that is not able to open a bank account
in my point of view
it would be way better
if he had just started accepting sats
instead of going through this stablecoin phase
it's sort of like
I see it as
alright, the boy is smoking
because he's using fiat
and here's Tether
it's a nicotine patch
so you can put the nicotine patch here
and you won't get the lung cancer.
No, but I'm still addicted to nicotine
while I have the patch, right?
Whilst Bitcoin is sort of the remedy to the whole thing.
So like to me, the thing I have a huge problem with
when mixing fiat and Bitcoin together,
and this is also like, it sort of misses the point.
We're trying to obsolete fiat, right?
And if we bake fiat into Bitcoin,
Isn't there a risk that we just prolong the existence of fiat and that we just perpetuate the problem?
Like, I'm unsure about the trade-offs and if they're worth it.
So that's my point of view.
I'm also unsure. I think you make three valid arguments.
Especially, I don't like very much the first argument, the one about alternate uses of gold,
in the sense that stuff like USDT are not creating any alternate use for sets.
Sets are still sets.
They are still a divisible amount of difficulty adjusted proof of work.
What is creating is alternative use for, let's say, block space or lighting infrastructure.
So it's like to say you're creating a different use for gold mines or for gold refineries or mints.
That's not the same as gold itself.
So the commodity set is not really influenced by this.
The second point, I think, is way better. So you're saying, does it make sense to improve liquidity if it's based on something ephemeral and scammy like a fiat scheme that can just, so the dollar will hyperinflate or the regulators will close down, circle and thither, and then all this liquidity that we assume to have disappears because it's fragile, it's not Bitcoin-like.
This is a good point, actually. It's a trade-off. I think that the privacy advantages, for example, could remain, but the liquidity advantages could backfire if they get removed suddenly. So I will agree with caution in that side.
The last one is a very general ethical problem of harm reduction.
I'm not super strong.
I don't have a super strong opinion.
If you are into heroin, I give you methadone, and you increase the probability of your surviving
heroin overdose increases for methadone, and maybe we can weigh enough methadone better
than heroin.
Yes, or maybe you just want to go cold turkey with heroin.
That's noble. It may fail, but if it succeeded, that's better in the long term.
Now, it seems like this is a very common discussion in libertarianism as well,
like mitigation of the problem, harm reduction.
It will postpone the real resolution, so it's bad,
but it's also helping actual people in the meantime, which is good,
which seems similar to the Marxist critics of charity.
Many Marxists, they were saying, you should not do charity
because you are helping the poor, and by doing that,
You are postponing the revolution by decreasing the revolutionary momentum, right?
So charity is bad because you are postponing the real solution with a fake one.
This is a, I think it's a sensible argument.
I don't think it's, I think that if a stable coin also harms Bitcoin in any way, that settles it.
Since it's already a dubious case, if it also creates any problem in Bitcoin, I'm against.
if I think there is an argument that it helps Bitcoin,
like in the case of Lightning Network,
especially because we're not deciding between that existing.
That's a typical harm reduction problem.
We're not deciding between something bad existing or not.
We're deciding it.
If something bad exists,
would we rather have it this way or that way
if we can hijack it or this way,
which is also a discussion we have with Oprah Torn
and this kind of stuff.
So I think that if we have stable coins
and as long as we do,
having them on Lightning with a good way, like RGB, is better than having them on Solana,
just because fewer people will be scammed by Solana.
All right. So what about introducing yet another argument against that, the slippery slope argument,
that if we allow these things to exist on Bitcoin, and if we make good arguments for why it's not as bad,
And like you're saying now that this is at least scamming the regulators and whatnot.
And we use that as an argument.
Then we end up with, I don't know if you saw the video of Pete Rizzo interviewing that Ether 2.0 guy who wants to build Ether on Bitcoin.
And they're claiming that Bitcoin maximalism is now, they're like warping the word and saying that it's now, you know, platform maximalism.
It's the idea that we should build everything on Bitcoin.
That's Bitcoin maximalism, which from my point of view, that's the opposite of Bitcoin maximalism.
And we want people to build all the other shit on other stuff, because if we have perfectly sound money, then we can pay for all the other shit in sats.
And that's the point of Bitcoin.
So is there a slippery slope argument or is that too weak?
Like, by okaying stuff like Tether on Bitcoin, aren't we encouraging other similar projects, the BitVM stuff and all of this stuff that is trying to build other shit?
Aren't we encouraging the Citrius of the world and the counterparty or whatever they're called?
Let me try to separate.
So, first of all, the slip and slop in general.
By allowing something, are we not allowing everything as a precedent?
So precedents do exist.
They are powerful.
Actually, one of my arguments against BIP 110 will be one of bad precedents.
So it will be a slippery slope argument.
It becomes a fallacy if we just assume that everything that goes in a direction will necessarily
cause everything in the same direction.
That's the slippery slope fallacy.
I think it's only a fallacy if we assume that we are ignoring the actual thresholds that we are discussing.
So what we say is, I'm tolerant of where use cases scam the governments, not use cases scam the users.
This is a fuzzy threshold, but it's a threshold.
So it's very easy to say that, for example, Ethereum, ETH, is mostly a scam to the buyers because of the pre-mine, the rollbacks and everything.
To some degree, people can launder money and avoid taxation with either, and I respect that, but it's mostly a scam to people.
NFTs have been a huge tax avoidance scheme because you can create an NFT that costs nothing and then you buy it from yourself and now you're an artist and you recycle a lot of Bitcoins.
So in that regard, NFTs are a good thing because they scam governments.
But still, the damage that they have done to the credibility of Bitcoin, to the brain of people with a nonsense argument has been worse.
So there is a threshold to be put about the scamminess.
I think there are a few.
So slippery slope is slippery because there is no discontinuity.
I think that this slope is not slippery because you have a few discontinuous steps.
So one step is the real purity argument, which says every scam is bad.
Even to defend people from regulators, you should always tell the truth.
I appreciate this level of this test.
I think it's a good equilibrium point.
I am very tempted to go above that because I like tax avoidance in general.
And so when you assume that you can lie to the SS to hide Anne Frank, which I do assume,
when you assume that then you have a second threshold which is basically when are you not
just fooling the bad guys trying to hurt innocent people but you are fooling innocent people for a
gain a zero zero negative gain this is the second threshold then there is a trust even if you are
tolerant here you have a third threshold which is this kind of stuff do you accept it even when it
hurts bitcoin technically creating overread negative externality or only when it creates
positive interactions like liquidity or privacy, even if could be temporary.
So I stop at this third step, say, okay, scams may be allowed against bad people.
And then I allow them only when they, in using the Bitcoin infrastructure in some way,
they do boost the Bitcoin infrastructure instead of basically damaging it in any kind or in
any type.
And this is, of course, a judgment call.
We may disagree in the merit, but I don't think it's not slippery because it's very clear when I will say no and when I will stop supporting that.
To me, it's very clear.
And of course, anybody could misunderstand me in order to support something I do not support.
But I can understand myself well enough to remember that there are a few discontinuities in this loop.
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So it's not a slippery slope, but rather a non-slippery ladder with those adhesive tape thingies that make you not slip on the ladder.
Yes.
All right.
So maybe we should get into the meat of the BIP-110 thing here.
It's a good point to start.
What is the slippery slope argument against BIP-110?
Yes.
So first of all, I need to do a distinction.
I am like 99% of my argument against BIP 110 is based on the assumption that it will fail.
So I will mostly discuss that because that's my probabilistic assumption.
I think that that failing will be bad for Bitcoin for reasons that we may agree about,
but maybe we don't agree about the probability assignment to this event.
So let's discuss first, let's answer your question first, because in the very, for me,
unlikely case, it does succeed.
I'm also against for a different reason.
And that the reason of slippery slope and the precedent Basically my idea is that a Bitcoin which can be changed in terms of fundamental rule in a way that economically pushes all the nodes to be
necessarily involved in that and can change arbitrarily, it's way more shitcoin-y as a
set of problems than a Bitcoin that allows non-monetary use cases. Examples, if we create
the precedent that every time we have ASICs or if we create the precedent that when we have GPU,
we change the algorithm of mining to become GPU resistance like Lightning. And then, of course,
GPU resistance doesn't exist. So we do that with FPGAs and ASICs like Monero does,
forking every while just to prevent ASICs. Or if we don't like the monetary policy because
security budgets care, and then we change it like Peter Todd proposes with Telemission,
and Ethereum does it all the time with monetary policy changes, that's another kind of bad precedent.
So rules that change for this way, for this kind of rules, fundamental rules that change easily,
create something which is not good money, in my opinion.
Not because the change cannot be positive, but because the fact that the rules can change easily
will create a precedent that can be used later for something worse than what is done now.
So I think that my idea is right now there is no consensus.
It's clear there is no consensus.
I think it's very, unless there is consensus,
if we eliminate from the set of people that must consent,
everybody would disagree.
In that case, there is full consensus like with climate change.
So there is 100% consensus on climate change
if you define every scientist which is opposed as a non-scientist.
So if you define any Bitcoiner like me, opposed to 110, as a non-Bitcoiner, we have 100% consensus.
Otherwise, we don't.
And if we can make a change, and the change is effectively enforced, even if it's good, or in my opinion, not even that good in the mix.
It's very confused, and it's temporary, it doesn't change much, it doesn't achieve much.
So I don't like the content of the fork.
But even if the content is not bad, because I don't think it will hurt Bitcoin, the content itself, the fact that a confused minority of Bitcoiners managed to change consensus for everybody with a lot of opposition by notable Bitcoin power users and figures, that create a precedent that would be very attractive for attackers that want the first that want to implement their pet projects in Bitcoin, including all the second layer stuff.
you were mentioning. CTV people, they learned that it was bad to create an activation clients
because there was not. Many people like CTV, including me, including Luke Dasher. Luke Dasher
thinks that CTV should be- Including mechanic.
Including mechanic. Most people think that CTV should be activated, but has not been activated.
Jeremy Rubin created a client activated and we told him, fuck off. We are not activating anything
until there is consensus because we are not sure yet. Then if the BIP 110 succeeded,
that creates a strong incentive to Jeremy to say,
who I am, like I'm the last of the losers.
Now activate CTV without consensus.
And then it will create the reasonable expectation
for drive chain to be activated.
And then maybe to TXH and other kinds of things.
And these are still good changes, which I like in the merit.
But then attackers would love to use this kind of momentum
of easy to change rules to also make bad changes.
And this I want to make,
I want to try to still man an argument
that we attacked as a bad argument
for many, many years about spam.
The fact that filtering spam is not censorship.
We criticize this abuse of the world many, many times.
Filtering spam is not censorship.
But the same technique that can be used to filter spam,
which is not censorship, can be used to prevent people from transacting with Bitcoin in a way
that is forbidden in fiat world, which is financial censorship. So I think that the fact
that our opponents in terms of knots versus core has been very, very sloppy into identifying
spam filtering with censorship does not mean that there's not a good case that changing Bitcoin
easily could be used to do actual censorship, like in preventing people from moving money
that are illegal for some reason.
So this is covering only the scenario which I find.
So I don't think, so let me put it this way.
I don't think BIP 110 can succeed because Bitcoin resists change by, which are not overwhelming
majority of all the economy.
and I think that the fact that it will fail will be bad
because my friends and the people that will be more rational
about the spam debates are on the wrong side
and they will lose credibility and enthusiasm if this fails.
So I'm opposed to the fork because of that.
In the case it succeeds, it means I'm wrong about Bitcoin
being super easy to change by vocal minority
and that scares me because it means that it is a slippery slope argument.
Maybe it happens this time, for example, for WASF, UASF Segwit.
Well, I was against that many people, including Luke, convinced me to be in favor,
mostly with the argument that, not Luke really, but other people convinced me,
like this is a one-off.
My friend Marco Amadori called it a Seldon crisis from the foundation cycle.
So Ari Seldon created this plan for the future, and the plan just goes on,
But sometimes the plan is broken and you do have to act one-off as an exception to fix the plan and put it back in rails.
But it's just one-off.
So if USSF was a seldom crisis, so something where you had to derogate from the principle of full consensus just to save Bitcoin from the apocalypse, I did buy it.
But I don't buy that now we are in another sudden crisis and without, because I don't think there is any crisis. I think there is a, there is an intelligence crisis in the definition of spam. There is a governance crisis in Bitcoin core, but there is no Bitcoin crisis in my opinion. And there is maybe a crisis in terms of node resources, UTXO management, because we have to improve the sync time of a node.
But this is not a seldom crisis like Bitmain threatening to fork Bitcoin and the New York agreement taking over the main implementation directly.
That was an incredible moment in Bitcoin history.
I could buy the idea that we could do a minority takeover because it was one-off.
I don't buy the idea that it would be a good thing that my opinion and most of the developers' opinion and most of the miners' opinion and most of the exchanges' opinion doesn't matter.
And an important point I want to make here is a symmetry between status quo and change.
So I'm okay if all the most powerful people in Bitcoin cannot enforce change.
I like it.
I don't like if the most powerful people in Bitcoin are powerless on stopping change.
That's a completely different thing because change is the trouble for me.
Status quo may not be perfect, but it is reliability.
It is something that money needs.
So the chemical property of gold may not be perfect.
Maybe you can improve them somehow, but they are stable from the beginning of super neutron star collisions.
They are stable.
You know that gold is gold.
you know, that all their malleability, the electronegativity, all the characteristics
are stable. So stability for Bitcoin-based rules are more important than the specifics of the rule.
And changing them without the entire economy supporting the change will be a very scary
precedence for me. Okay, so I'm going to try to steelman the argument against all of this stuff,
because I don't view BIP-110 as a change of the rules.
I view it as a temporary tightening of the rules,
which is not changing the rules
in the sense that every single BIP-110 compliant block
is also compliant with everything in the non-BIP-110.
So it's not actually changing anything.
If anything, it's just taking Bitcoin back to what it was
before all these changes were introduced by Core.
and you can say that these are not consensus changes
these are mempool changes
but they were clearly changes
that the entire community was not on board with
like 20% of nodes are not nodes now
because of the behavior of core
and that they changed definitions
and did all sorts of things
I think the biggest issue for most of us
definitely for me is this defeatist attitude
that you can't do anything about it.
When you have clear signals from Vitalik, for instance,
and other people from way back when in the first Opera Term Wars
where they say that they chose to go and build their own stuff
because they feared that they would be subject to change in Bitcoin in the long term.
So to me, the biggest thing in Bitcoin that cannot ever change
is the users being in charge,
like everything else being downstream of the users.
is the core thing that, pun intended, or pun not intended,
but that cannot change.
And it was always the case that putting spam on chain
was more risky for the guy doing that
than putting a normal transaction.
Because it's sort of like this South Park episode
that I always come back to, the death camp of tolerance,
that points out the difference between tolerating something
and approving of something.
We tolerate spam.
we don't approve of it and at a certain point we don't tolerate it anymore because it becomes such
a big problem that we have to do something about it and this to me is bitcoin not changing this is
bitcoin bitcoin's immune system acting exactly as it was intended it's the users being in charge
and i also think there about the fork the risk of the fork you say you uh you don't believe the
fork will happen. And I think there's a Pascal's wager thing here. Like if we don't believe it will
happen, then there's a smaller likelihood that it will. But if we do believe that it will happen,
and we do signal that we are pro this thing, just temporary restricting things to make it
slightly more expensive for spammers, making sure that they know that they're not welcome here. We
don't want Citria here, we want these people out of our chain that is there for monetary
use only, then if we believe that that will happen, there's a higher likelihood that it
will happen. That's the Pascal's wager of it all. And I think this is at the core of
the debate is who initiated change really?
Was it the BIP-110 people or is BIP-110 an immune reaction
to core making changes that weren't wanted in the first place?
And it's maybe not even about the mempool policy thing
and the op-return being blown off.
It's more like changing definitions and stuff
and the rot that has been in course for years now,
and it becoming more woke and more like,
I don't think NFTs are bad and all of these quotes, right?
The monetary maximalists or whatever you may call us
sort of see that and see that as the danger.
And BIP-110 is just Bitcoin reacting to changes that weren't wanted.
And so in terms of that,
if you see levels of mempool policy as like the lightest thing,
and then soft fork is harder, but the real change is a hard fork.
And if now the other side decides to hard fork off, then so be it.
Like, I don't think anyone on the BIP110 side intends to fork off.
We just intend to, you know, do what Bitcoiners always do,
run whatever software we want.
I know you run, for instance, both Notts and Core and LibreLite at the same time.
So, and this is fine.
I mean, we're...
But not Corv30 because that pisses me off for governance.
Yeah, and Corv30 pissed off a lot of people.
And this is why there wouldn't have been a BIP-110 if that hadn't happened.
I agree with this.
And BIP-110, so the thing I see is like, where's the risk?
If this is temporary and it's restricting so that it's basically just telling every developer
and every miner and whatever who was building this
and that vault solution or whatever they were building
that was technically advanced and really fancy,
they just have to wait for two years.
I mean, Bitcoin is not made for wallet developers.
It's not made for people who want to build stuff on it.
Like people who build stuff on it must know what it is
and build for users.
It's the other way around.
Like we have no obligation to cater to
developers. Like why would we? If the users aren't in charge, then this is not Bitcoin anymore.
That's the way I see it. Let me try to break it down because of several different points. The
first one is the difference between change and well, the first one is the difference between
permanent and temporary. I am open to this distinction in the sense that a victory of a
temporary soft fork, which is controversial, I would consider it less bad as a precedent
of a victory of a permanent soft fork, which is controversial.
So I agree that temporary measure does reduce the concern a bit
because what if we were wrong?
What if the alarm was about nothing?
What if the solution is imperfect?
Okay, we just wait and we just deactivate.
I agree that this is a good point, but I think that's canceled out
because if you assume that it's just needed temporarily to send a message,
then you're also implicitly saying that we are, in this case,
I would go into the second argument, which is a waste of scarce resource,
which is coordination about a soft fork to something which is just temporary.
So all this buzz and then after two years, we'll be back where we started,
plus a social signaling, which I give a non-zero way to.
I think social signaling is important, but I think it's unstable.
Like social signaling is something that people could be civilizations on.
So I will not dismiss it, especially in social circles that have name and faces and physical gathering like Bitcoin Core.
If you allow Bitcoin Core to accept whatever NFTs, that's bad because you're giving a signal to scammers and to shitcoiners.
But that said, while I think social signaling is very strong in mid space, we realized after a few decades of internet that social signaling is very weak on the internet.
Because on the internet, you don't show your face, you don't show your name, and that's a cypherpunk dream.
So you cannot be hurt physically or socially.
So you do whatever you want and social stigma will not stop you.
So if we say we should not accept the Bitcoin core physical meetings or conference are friendly towards shitcore scams, I think that's a threshold we can try to enforce with some effectiveness.
If we say the network will socially reject something that it cannot technically reject, I think that's wishful thinking because anonymous people on the internet will not be stopped by a signal.
So the second the soft fork is temporary soft fork expires, maybe we will have used that soft fork to send the signal to Bitcoin Core and whatever.
But the network in the sense of anonymous people on the internet trolling us with spam, they may even be emboldened by the challenge.
Many of them are, and they would come back more.
I think they will spam Bitcoin during, they will spam Bitcoin during the activation, just
using BIP-110 compliant method of spam, which there are plenty, and they will spam more
when it finishes just because they can.
So let me, so this is the first distinction, temporary versus perpetual.
I agree it's less frightening, but it's also less effective.
So that's, I think it cancels out a little bit.
Let me move then to the second point, which is soft fork versus hard fork.
You're saying not really a change, more of a tightening.
I think, yes, that's like saying that we prefer the president of a soft fork than of an hard fork.
I agree with you.
Hard fork would be very bad as a president.
Soft fork less so.
But still, soft fork can be used to mess with Bitcoin in important ways.
Some of those are all these second layer things that can be enabled by soft fork.
and other things will be blacklists or many other bad things.
So softwares can also be bad and there is no reason to say they are not a change.
Which goes to the third argument, which is I want to change the rule, not to change the system.
Now, I want to do something tricky now, which is using the argument, the Roger Ver fallacy.
We'll see it's a fallacy, possibly.
Roger Ver and friends, during the Block Size Wars, they were saying,
And I remember so many blog posts and articles about that.
We are not changing Bitcoin.
You are changing Bitcoin.
Because even if we are proposing to increase the block size, the actual economics of Bitcoin
were in a way which was low on chain fees.
Now, the situation has changed.
Now, fees are high.
So if we change the code and the rules, we will maintain the spirit of Bitcoin.
If we don't, by keeping the rules the same, you are proposing to change Bitcoin because actually now the new conditions are different.
This is a very similar argument.
I think that it's just, it's an interesting rhetoric tool, but it's not really super helpful to understand the problem.
But, okay, interruption there because Roger was talking about a hard fork, not a soft fork.
There's a crucial difference there.
I agree and it makes a difference, but the trick to say, I want to change the rules to keep the situation the same is similar.
That doesn't mean it's wrong.
I just want to point out it's similar.
And I want to point out I didn't buy there, I didn't buy then, not because it was a hard fork.
No, but if you're making the argument like comparing a hard fork proposal to a soft fork, you must also compare it to a mempool policy change, I think, and say that just going along with whatever core wanted is also like using that same type of argument.
changing something because that's exactly what it is.
I agree.
We need to change this policy because otherwise these spammers will use even worse.
So they're giving up, giving in to a change in the attitude of Bitcoin's users.
I'm just saying the same argument.
I think, well, it's not so important the debate, I think, but I think it's different.
The Bitcoin core propaganda right now was never, we need to open up a mempool so that
Bitcoin stays the same.
They never pretended to be the real conservative ones, I think.
Well, maybe there are some exceptions.
They mostly say that the network changes, so we have to change policy in response.
Exactly.
But that's the Roger Ver argument.
That's what I'm saying.
That was slightly different.
It was the network changes, so we need to change in order not to change.
So that was the flipping of the conservative position.
So in Bitcoin, since we want, so I think there is a very powerful attraction to stability
because money must be stable.
So whatever seems more conservative or stable puts you on the highest ground in Bitcoin
because you are basically remaining the same.
So you are giving money stability.
So, Roj de Verbe was specifically saying,
by changing the rules with an hard fork, which is way more,
we are preserving the economic status.
Why Cor is saying, by changing the mempool,
we are just surrendering the precedent status
and we're moving to something new, which is unavoidable
or for somebody even desirable.
So, I think that's a difference.
It's not so important in the overall debate,
but I think there is a difference there.
But my main point is that we should basically, we should not, we should not, we should call a spade a spade.
So this is a change.
And the fact that this change is trying to put the network in the same situation it was before inscriptions, it's a valid point.
It's a less, so let's say in the slope, in the ladder, there is a discontinuity you can say.
You can say, no, Giacomo, this is not a slippery slope.
This is not a bad precedence.
Because we will only do soft forks, which put Bitcoin back to a state in which it already was before.
So that's a legit thing.
It's something that reduces my concern over a victory.
But it doesn't put it to zero.
Because I still think that some people, I accept this difference.
This is a changing of the rules, which is something which creates a scary presence for me.
in order to remain to a shelling point that was already present on the network before.
So any bad thing that wanted to happen in the future, we can still make a distinction.
No, wait, we were doing a changing on the rules only to repristinate a state of the system.
We will not allow a changing of the rules in minority fashion in order to change the
state of the system.
That's a good argument.
I accept this argument.
I don't think it's definitive, but it is a partial mitigation of the slippery slope concern that I have.
Yeah, and to emphasize that, I think the whole this is setting a bad precedent argument is that there's more to it.
Because you still require consensus, right?
You still require, in BIP-110, it's 55% minor consensus, and then the thing happens, right?
Even without it happens anyway.
It happens anyway because users are just going to make blocks involved.
But the thing is, it doesn't say anything about OFAC compliance or anything like that.
Trying to gain support for a fork that nobody in Bitcoin wants is still going to be super hard
because this is a change that people actually want.
It's not a change that people don't want.
And yeah, I guess we'll see.
Yeah, but I mean, people are regarded.
I mean, I said at 9%.
Let me go to my, so I acknowledge the fact that a status quo achieving change of the rules is better than an unbounded change.
Okay, that's the difference.
But then you say, the real thing we want, so if you were saying the real thing I don't want to change is the state of Bitcoin before inscriptions.
I may say, okay, that's a shelling point that maybe we can agree.
Not everybody will agree, but we can try to push for that.
But then you say the real estate I want to conserve is users in charge.
And that's very scary for me because people are retarded.
And people are retarded if they vote, one person, one vote, they are retarded and they vote for socialism.
And if you put a weight, a coefficient on the votes, and this coefficient is hash rate, you have the mining cartels.
And if the coefficient is GitHub commits, you have the core elite.
And if the coefficient is Twitter retweets or rashes, you can have bots or whatever.
And you have the podcastocracy.
I'm pro that, of course.
Of course, yeah, because you're pro podcastocracy.
But wait, because Levera is a very powerful podcaster.
Yeah, but he's not a podcastocrat, he's a podcast... what was that? Tater.
Well, but he may be tempted to become one if you have the power to change Bitcoin.
So I think that the idea that this is a very Luke idea that I always found odd.
With Luke, I'm always very careful because he has a very careful cathedral of definitions in his minds that tend to be internally very consistent.
But I never bought the idea that there is a happy ending in a democratic Bitcoin where users are in charge.
I don't trust users.
I think users, most of Bitcoin users were in favor of COVID restrictions.
Even if many Bitcoin activists were not, users are retarded.
Sometimes even activists are retarded They easy to scare They easy to misguide They are easy to send following including me So I trust myself a little bit more than I trust everybody else So if you were telling
me users, that's very scary for me. Sounds like democracy to some degree. Okay. So let me try to
argue against that because I don't mean like a democracy. Of course I don't because that's
retarded we know all the people are retarded uh uh so the and here we go into you know economic
nodes versus just listening nodes and and whatnot and even the arguments about prune nodes and
whatever and what constitutes a user but at the end of the day i think like a company like coinbase
or running a very significant economic node they have they have their clients they have their
customers and the needs and wants of their customers to, they have to keep that in mind.
Like the reason I love Bitcoin is that it's the closest thing to a free market thing there is.
Miners are clearly employed by the network to secure it. And in order to do that, we pay them
in Bitcoin to do us a service. And that's why I love it because it's totally based on free market
dynamics. We pay for services. By using one wallet rather than another, we clearly signal
to the market that we like that one better. I wouldn't call it a democracy. The users being
in charge, I would call that a reflection of as close to a totally free market economy we can get
rather than calling it a democracy. So that's the framing I have. The more skin in the game you put
in, the more influence you have. And I'd say every single person on earth is an economic node.
They are very differently powerful, of course, but someone signaling on Twitter this or that
does have an impact on people. It does have an impact on the network because some guy running
a very significant economic node may change his mind about this or that. So you can't really
disclude anyone from the equation, not even no coiners or shit coiners that are doing the damage
in the first place. So like at the end of the day, I think everything is down, which is why I think
plebslop is more important than devslop. Like at the end of the day, it's all about the will of the
users. And sure, they may be retarded and make wrong decisions, but at least it's their decision.
Yeah, let me refine. So thank you for helping me refining my argument, which was so that the
The comparison to democracy, of course, was misguided because democracy is a system where the majority of retarded people can actually take other people's property or hurt them physically.
So it's something where the retardedness can express in the most hurtful way and the most irreversible ways.
So it's very bad.
Bitcoin is, as of now, a completely voluntary system.
So everything we're discussing, including NFTs, shit coins, monetary maximalists, platform maximalists, everything right now is going on the basis of not enforcing anything physically hurting people or stealing stuff.
So that's already better.
So Bitcoin is a market process.
So let's leave democracy aside because it's a bad comparison.
Let's put it this way.
I don't think that people are retarded only when they express preference in democracy,
which maximize the damages of retardeness.
I think people are retarded always, including in market processes.
Market processes are always better than no market processes.
So no market processes are rape, slavery, plundering, and fraud.
No market processes are always bad.
Market processes have the way to be bad and good and to learn from the mistake
and become better and better.
So the market process is good.
People, actors in the market, they are still retarded.
So it's not because something is appreciated by economic notes that I have to go along with that.
During Segwit 2X, actually, our enemy, the New York agreement, was fully anarcho-capitalist debate of ideas.
They were not threatening very much to send cops to earn me if I don't...
Disagree.
Why?
Because I don't view fraud as a free market thing.
Like if you fraud is a breach of contract and if you're deliberately trying to scam people, you're not a free market actor.
You're a scammer. You're like you're you're you're deliberately planning a breach of contract somewhere.
And of course, there's the distinction is is fuzzy, to say the least, because where do you draw the line between a scam and a non scam?
But in terms of the New York agreement, I think it's an obvious takeover attempt to set the precedent to make it costlier to run nodes.
And then you end up with Ethereum, like 10 full nodes in the entire world and a cabal of people controlling the whole thing.
I mean, everyone, only the big players was, I mean, this is where I fell in love with Bitcoin because the users, the customers were in charge.
It's clearly showed that we could win battles like that.
It didn't show that we had won the war.
It's probably a perpetual war, if you can frame it like a war,
but since it's voluntary, but at least we could resist the attack.
The users could.
Most of the users wanted bigger blocks because they were retarded.
And like most of the people I knew in the community wanted bigger blocks.
And most of the people...
That's not the impression I got.
I got the impression that most people did not want,
and that's why we won with the user of activated soft fork and everything.
I think that's not the case. My analysis of the block size wars is that people who understood Bitcoin and the trade-off didn't want bigger blocks. People who didn't understand the trade-off, which were majority, if you count the number, of course. And they were also majority of the businesses, including Coinbase and all the others. So economic majority and user majority, they were in favor of big blocks.
I agree with the economic majority, but they had incentives to be pro this because it would make their market position even stronger.
They would create monopolies like BitPay and Coinbase and so on.
I'm not saying they were not incentivized.
I'll say that they were.
So the market, part of the market was highly in favor.
Miners, of course, free market players that were in favor of becoming more monopolistic.
So the incumbents were mostly pro.
People that were against were mostly a game out of a very high sophisticated location on trade-offs on the future,
which was a relative minority if you counted the hats.
But I think the reason we won is because Bitcoin gives a disproportionate advantage to status quo.
So I think that if we wanted to, so for example, now I want to reduce the block size.
I really want to.
I don't think I will win because people are retarded.
and if I explain to them why we want a smaller block size,
they will not get it.
So I will never get a strong majority of the economics with me
because Bitcoin favors status quo.
So I think that block size wars has been depicted
as something where the users win,
but then you say, what is a user?
Because you have Sybil attack.
You can just pretend to be 1,000 users.
So you do Ashers.
No, because the miners were in favor of 2X and they lost.
So economic notes.
But actually, if you think about that, Coinbase is a huge economic node delegated by the users and they lost.
So what really won was not these ill-defined users.
What really won was some users, possibly a minority in many, many metrics, if not in technical expertise.
It was a overwhelming majority of technical expertise, but a minority in heads, the minority of voices on Reddit,
the minority of voices on Bitcoin talk, the minority of hash rate, and the minority of
businesses accepting Bitcoin. It was the majority of people not giving a fuck. So let's say, let's
put it like this. People not giving a fuck in Bitcoin, they default with the resistance,
with the status quo. And that's the superpower of everybody defending the status quo. I think
that if we try to say the user are in charge, you may always find a subset of users as big as
small blockers. They will try to do something stupid with Bitcoin, including maybe, I don't know,
replacing a CDSA with quantum resistance stuff. Many users right now will do that change because
they are retarded, because they don't know quantum mechanics. And so they will believe everything
they read on the newspaper. Okay, here's why I dislike that framing. And that is because it
sort of takes for granted that people not giving a fuck weren't acting, that they were just not
giving a fuck and not worrying about the thing. But inaction is also an action, as you know,
from Praxeology, you can deliberately not give a fuck. And I think the users were deliberately not
giving a fuck because they saw the trade-off and they realized that doing a hard fork and setting
a precedent for increasing the block size over and over again was super dangerous.
And that's why they refuse to do so.
So I don't buy that they...
It's sort of like the parallel to COVID here is the Swedish government, which was a very
retarded government at the moment, which was great because they didn't do shit.
So in that case, I do buy that it was because they were retarded that they didn't act and
therefore we didn't have mask mandates.
It's great.
But in this case, I think, how could you quantify who was deliberately being inactive and who was just not giving a fuck about their nodes?
Like, there is no way to quantify that.
So you have to make the assumption that it's a deliberate choice.
I have assumption, but I think they are very realistic assumption on the fact that the user of Bitcoin, which will affect the economy, is not a Bitcoiner.
Just like the user of a motorcycle is not a biker and the user of a rock is not a rocker.
So the BitConer is part of a specific subculture.
The subculture with the memes and everything was clearly won.
The subcultural war representative, the meme war was won by us because we had Samson and
the Dragons' Den and we were just better at memeing.
And to some degree, because technical reality was in our favor and that helps the memes
sometimes, because if you can meme the technical reality, you can have an advantage. But the
reality is that even if we were better at winning the subculture, the total amount of users of
Bitcoin, including everybody that will receive any Bitcoin or not, as you said, even the coiners
are users to some degree with a very low economic impact, even shit coiners, all these users were
not even aware that the block size war was even happening because many people use Bitcoin even back
then without being on Scaling Bitcoin Conference or on Reddit or on Bitcoin Talk. And most of the,
I would say that if I have to say, if you define people using Bitcoin to some degree, I think
probably by 2017, 50% of them barely knew there was a block size war going on. And of the other 50%,
percent probably uh 30 percent has no clear um definition of even the problem and then of the
people with strong definition of the problem is like majority of people were big blogger big
blockers in terms of any metric you can define except for technical proficiency on github so
developers they were small blockers overhandingly miners and businesses they were big blockers
overwhelmingly then you had the odlers and that's an important thing then you have bitfinex creating
the future market and then you realize and that was a very important thing then you realize that
hodlers they tend to most most others both by quote pro quota so with an economic weight of how
much they had in terms of willingness to so let me reframe even better people with a lot of money and with a lot of risk with low risk
aversion in betting, they were overwhelmingly skeptical of 2x.
Not really against it, just skeptical it was going to happen.
That's what basically at the end killed it.
But I would absolutely...
I think your framing of the block size wars as a moment in which people are strangely not retarded anymore
and the majority of users really understand the problem and really can set the trade-off
and choose for the better trade-off globally is very optimistic.
I think that people are very good at choosing local optima,
and that's why free market is the best because it allows people to experiment with local optima,
but people are very bad at making decisions in general, including us,
because we have partial information, because we don't have complete information,
because we have a rational ignorance of stuff that we are basically a division of labor.
So not everybody is an expert on block size and stuff like that.
Yeah, to clarify my position, it's not to say that everyone's not retarded.
All I'm saying is that it's impossible to quantify who was retarded or not.
I agree with that.
I think that we still have an heuristics that in general,
most people were not really understanding the trade-off.
The point you're making about free market being very good for local things,
I would count running a node as such a local thing
and that the guy intending to run one and doing his homework
and why that's important and what software to run,
there's less retardateness than in a lot of other things
when you come to that stage.
I partially disagree.
I mean, yes, compared to elections for sure, but running a node has a very low impact on things that people can measure as a very large feedback loop.
For example, if you don't run a node, you may lose privacy by connecting to a server or somebody else, but you will not realize, you will not have a feedback loop of your action until the cops will basically steal your stuff because you leaked an IP.
And if you don't run a node, you may have miners, basically miners colluding to let you accept inflation or theft in Bitcoin.
But you will realize that only when that actually happened, which never happened in Bitcoin so far.
So not running a node is something that will hurt you only far in the future and in some scenario which are bad enough that we want to prevent that.
But if I, so let me put it this way. If I do run Liber Relay and I do run Nots and I, my life doesn't change, if not intellectually due to that, because I didn't find any block in Datum yet. So I didn't generate a clean block with Nots. I don't use Liber Relay for mining, but I didn't create any block.
I don't, my fee estimation, unlike people in Korea saying, is not worse on notes than it is on
Liberale. It's not even significantly different. So I have the same fee estimation, I have the same
block production, which is zero, less sadly, because I'm a shitty miner. And doesn't, nothing,
I don't have, reality is not giving me back any feedback loop on running my dot. That doesn't mean
it's not important. It's important for staff that are very, either far in the future, like privacy
leaks or low probability like minor collusion, but it's still important.
So you don't consider people calling you an arrogant asshole for running Librely on X
market signal?
Yes, but yes, it is.
But interestingly enough, I will receive that signal if I run, if I really, so you don't
even know if I really run Librely.
No, no, no, you can say that you do.
The real thing is the performance.
So the real point is go on Twitter with an opinion on this.
That's the point that will change my life for the better or the worse during the day.
But running the node will change nothing.
Now, this is interestingly, so now a very interesting game that we like to play right now is who on the two parts of the debate are more like big blockers.
And everybody is saying, no, you, no, you, no, you.
I think there are very equally heavenly distributed points in this because in some ways, clearly, core is the big blockers and BIP-110 is the small blockers, especially in the sense that nodes don't matter, don't even write a node and stuff like that.
then there is the ways that BIP 110 proponents are the big blockers,
which are change the rule in order not to change the economics,
which we discussed before, different because of fork and temporary.
And then there is developers, evil, common people, perhaps good.
That was a very big blocker, anti-intellectual attitude during the block size wars,
which, by the way, I was very tempted for because I tend to be anti-intellectual.
So whenever I see the plebs against the elite, I tend to side with the plebs instinctively, but not in this case for the specifics. And then there are a few other things. For example, the fact that big business was siding with somebody in this case, clearly big business is siding with core, not even that much, but less than before.
there's not like a clear user-resistant software by big business, but it could be.
And perhaps, and let's say, small users are siding with the BIP.
So they're interesting comparisons, but they're not clear cut.
It's not that one of the side is clearly Roger Verlake and the other is clearly the opposite.
This is a shuffling of the players and the shuffling of the rhetorical point and of the arguments, I think.
Yes, history doesn't repeat and it doesn't even fucking rhyme
Not this time, not this time
No, and I agree with that completely
I just, from my point of view
Even if all it accomplishes is a hit on the nose on these spammers
I think it's worth doing it
Because I don't think people hate them enough
And the scamminess and the shit that is being built
And the rot that is happening everywhere
and you can see, maybe it's just my feed.
What do I know?
But I see like the Bitcoin magazine people in particular,
a lot of people from that camp and similar camps
are now like doing,
to me it looks like another wave of shitcoins
and another wave of shitcoinery.
It's the same narratives as it was back in 2017.
It's just that now it's much more destructive
because they're trying to do all of it on Bitcoin.
And to me, it's just sending a signal, even if you call it a virtue signal.
Yeah, I do want a virtue signal.
I want to send a signal of virtue to the network that we do not want this.
We are Bitcoiners.
We are here not because of short-sighted, high-time preference, fiat gain thingies by scamming people and building this or that.
We're here because we want, as you said, the status quo being – what words did you use that there's a proclivity for status quo or that there's a –
Well, asymmetric preference for the status quo.
Asymmetric preference for status quo.
That's what I like because the opposite of that is an asymmetric preference for the status quo, which is what fiat leads to, right?
Agreed.
So I think anything I can do in my power to help the former and fight the latter is to me worth it.
And that's why I'm pro this thing.
Well, let me, so I agree that virtue signaling on something which is virtuous is good.
The problem is at what cost.
For example, I was virtue signaling by running notes, mostly virtue signaling.
They didn't change the word, but it was signaling something.
And people were, but if you do that, your fee estimation may be slightly off of one micro set every five years.
Okay, I'm still virtue signaling.
The cost is irrelevant.
So even the low payoff from my virtue signaling is enough to justify it against the cost.
But if you do that, maybe the relay of the minor relay will centralize.
But this is irrelevant.
It's like if you do this, Cytria may not change idea on using fake pipe keys and keep using up return for a fucking super edge case in the future when that will even be a thing in the market.
Okay.
I mean, I'm sorry for that.
I don't care.
I run nuts.
The difference is that if you virtual signal with a change of consensus and you fail in achieving a super strong economic consensus, you stop accepting Bitcoin blocks as valid.
Well, no, that's a high cost.
That's too high a cost for virtual signal.
And if you do that, not only you, but all the people that thinks like you about spam and about this shitcoin that goes on, they will all fork off.
And then, of course, they will just probably switch back.
but they will be reputationally and culturally weakened.
And all the enemies will be emboldened by the fact that they will just tell you, I told you so.
So the demise of VIP 110 will be, and I think will be, a strong point in favor of this shitcoinery
just because we have been tricked into virtue signaling at the highest possible cost.
I think it's not by chance that while we were fighting spam with notes and filters, people were just teasing us, just fork off, just fork off.
And we were answering, no, consensus is static, spam is dynamic, so filters are the best.
And they were, fork off, just fork, do it.
They were like, do it, do it.
If you have the balls, do it, change consensus.
And that was not because they were kind to tell us what, they were not trying to help.
They will try precisely to lead us into a trap.
And I think that most of the movement felt into this trap.
Yeah, they were bullying.
But still, this is not a hard fork.
This is a soft fork.
It's better.
Whoever initiates the hard fork is the one forking off.
Like, not the people running a soft fork.
Like, all of the blocks we will mine on are compliant with the other.
I don't think this is even a debate because it's not working off.
This is another beautiful Luke speak, which can be made internally consistent, but it's clearly at odds with any common sense definition of Bitcoin.
Fork is usually when you change the rules to allow stuff that was not valid before.
Keeping my core node is not an R4 from any practically useful definition.
Keeping my node as is, is not a hard fork.
Of course, if we redefine Bitcoin as a Bitcoin, which already includes BAP 110, but then if
we don't, so for example, push torque activates drive chain tomorrow, BAP 300, 301.
I don't.
I'm not hard forking.
I think this definition of hard fork becomes very useless very fast.
Okay, but here's the question then.
So the activation date comes, and you're a miner, and you can either choose to start mining BIP-110 compliant blocks, or you can mine whatever blocks.
And if you do the latter, you are at risk of losing a whole bunch of blocks later down the line, but you're not if you just stay compliant with it.
And the cost of that is just this maximum 2 extra fees And what miner would risk that And what the argument against this just activating because of that
Sure. So at the very beginning, the miners will not do it because it's risky for nothing.
So just stay compliant.
But the fork is not asking you to only do that.
So there are two things that you can do.
One is to create a block which is compliant.
And the second is to create a block on top of other blocks that are compliant.
The second part is the hard part because it costs me nothing to create a compliant block.
It costs me 2% to create a compliant block.
So I would prefer a compliant block so I don't risk to be orphaned.
But if the longest chain, the heaviest chain is now non-compliant, whether I am now compliant on top or not, I'm still not compliant, right?
So this is the thing that as soon as there's a non-compliant block, that's where the risk happens. But who would mind that non-compliant block? Would it be Mara? Probably.
Well, I mean, just wait.
I mean, so this can stale the fork for very long.
But to assume that for all the duration of the rule, which is one year, nobody, even out of chance, even a troll with a bid X, will find ever an uncompliant block just because at the risk of being offered.
I think that's a very optimistic assumption.
I hope.
So it's not zero probability.
I hope it works out.
And that will be what I would call a success, which would trigger in me the minor concerns about the president, which, as I said, are not as big as the ones about the failure.
But I think it's a very, I mean, we can all, I can pray.
I know you don't, but that's, I think you should start.
You think I don't.
Exactly.
I think you should start, Nude, because.
You assume I don't.
because if we are hoping that this risk will not be taken from the activation date
until the end of the year by any miner able to do one block,
that's a very, very, very bold assumption.
Even because some people will just create a block,
some people may put energy into this just to piss us off,
And some governments may confiscate a shrate just to divide the Bitcoin community.
I'm not sure they have a plan right now.
But if I was my enemy, I would probably maximize the damage to the Bitcoin community by mining an uncompliant block immediately.
So some of the voices that are more critical of shitcoin and Bitcoin are basically reputationally or economically forked off the network.
So it's very hard for me that it will not happen.
Luke's argument, of course, and I don't know if we have time to go there,
but Luke's argument would be no, because nobody is,
only pedophile will buy the blocks.
But that's not, I don't think it's correct,
because you can make a block which is not compliant with zero pedopornography.
You just have to avoid the fork.
And so it would be something that I think will happen.
And when it will happen, I think that core people will,
will like
30 people
will
will flex
and
and and
and gloat
and and
and be
happy
and be
credible
because
they were
like
I think
that after
blocks is
worse
we won
mostly because
of status
quo
preference
and we
received an
underserved
credibility
in developers
out of that
because the
winners are
always considered
better than
they are
because they
are the
winners
so there
is this
right
history
yeah
Yes, I mean, Giacomo, this has been fantastic. Regardless of what side you're on here, in August, a good investment would be in any company sending popcorn for sats. I'm sure I'm waiting for that.
Long popcorn. Oh, wait, Krut. Let me, if we have one minute.
Yeah, yeah, yeah.
I wanted to show the screen because I think that I wanted to, let me say, window. Okay.
okay so i wanted to share a couple of meme all right one is this one i think that i feel like
this a lot because you say this is was shared by elon musk as well uh in um i've seen it yeah in
in 2000 uh this is 2008 but for me it was like 2024 i was very aligned with the left and now it
his fellow noses, so running notes.
So I was like, spam is bad.
Oh, okay.
Maybe it's not, maybe spam.
I mean, I was already running Libre Relay, so I was close to the center because I said,
yeah, the argument about incentive compatibility is a good argument, but spam definition that
they're using is retarded.
And then basically, people were saying, just fork off and me and you and mechanic and look
We were responding, no, we won't because forking, because spam is a dynamic problem and filters are dynamic, but consensus is static.
So we won't fork, we won't take debate.
And then these running people are you, my VIP 110 friends.
And now I close to the center because, yeah, you know, I'm still not, I'm still anti-spam, but I feel like I'm not running, I'm just staying here.
And then for the last few months, people are calling me shitcoin enablers and spammer and Procore and Walk and Pedo and whatever, which is basically me feeling moving to the right.
But I stayed there.
I think I just stayed there.
And it was the whole anti-spam movement to run to the left.
But I'm still, so I think if I read my tweets in 2024, where I was agreeing with Luke and
Mechanic and many others, I was saying the exactly same things in the merit that I'm
saying now about forking.
And the second, which is a more advanced version of this, is this one, which is not only I
stayed in the same position and BIP 110 people are running to my left, but also I perceive
that they are radicalizing me in the other direction.
Because, for example, I disagree.
I make you an example.
I disagree with Peter Todd on many things.
Tail, mission, geopolitics, many, many things.
Genocide.
And I hang out with Peter discussing Bitcoin since 2016.
He was the first person I started to do that with.
I never used friendship or closeness as a criteria to agree with him.
So I never said he's a friend.
So whatever he's saying is not retarded.
I always did the opposite.
I always stayed very clear on that, which is something I do with other friends.
Like I'm friends with Bruce Fenton and I think he's a shitcoiners and I think he's wrong.
I was friends with Antonopoulos before COVID.
Then it became a little bit more personal and he was wrong on shitcoins and was still
hanging out with Antonopoulos.
So now if people come to me and they tell me, if you are, if you keep, which is something
a little bit like this. I'm still doing the same thing, making a freaking meetup with Peter freaking
Todd. I still do the same. His position may be more radical on spam. Not really. They're always
the same. They're literally the same since I know in 2016. His geopolitical position on genocide and
killing Russian babies is, yeah, that's notably worse. And I tell him they are notably worse,
But so are other positions in the Bitcoin space that I disagree upon.
For example, Luke, I think it's probably for that penalty for masturbation or something.
I think it's wrong.
I think you should not give that penalty for masturbation.
Still, I stay there.
And if the best way to push me, and that's the contrarian problem that I run into,
The best way to actually radicalize me against BIP 110 is to force me to change my ideas of preference based on the new thing, the new current thing.
I'm still repeating what I think.
I'm easy to convince otherwise if there is anybody that has a good argument to convince me otherwise.
But let me try to stop sharing.
But I feel radicalized, not by you, of course.
but this is a message to the fellow plebs.
So let me go back to the Pascalian.
I don't think it was actually a Pascalian wager
in the proper sense
but what you were saying is basically
this is like a Schrodinger observation.
If you are against something
that can increase the probability of failure
just by being engaged.
I realized that.
So if plebs,
if you think that I'm important for BIP 110,
I don't think I am.
I think that if your fork relies on me,
we are screwed anyway. But if you think it's important to have me there, stop trying to police
me about what I do and what I, where I meet and only stay on the arguments because that's super
triggering to me. That's makes me, that's one of the reasons I became so radicalized against Core
because they were saying to me, you cannot run Nutz. What? I cannot what? So that's really
triggering to my contrarianism. So that's absolutely not what Nutz is doing. And this
kind of debate actually helped me smoothing out my position. I didn't think I changed it,
but I think you made a few good arguments mitigating my concerns in case of victory.
I think I'm still very, I still assume defeat as very, very probable. And I still think that
the defeat will be bad for the anti-spam movement.
But I think you assured me that if I'm wrong and if he wins,
probably the president can be insulated for many reasons
that will not make it very, very concerning for the future.
You convinced me, I think.
Well, happy that you say that.
You know, I love having you as a sparring partner and a friend
to point out to me when I'm being retarded.
and on some of the points, sure, I'm slightly retarded,
not entirely convinced that I'm entirely retarded about this whole thing.
I think guilt by association is something that we can let lefties do
and we shouldn't be hostile to one another for guilt of association.
I mean, I do a podcast, I talk to people.
I think diplomacy is a very important thing
if we want to bridge any gap ever.
Sure, there are exceptions,
and there are people you shouldn't platform.
For instance, I try to not interact
with shitcoiners anymore on Twitter
because of the whole never pick a fight with a pig
because you both get dirty and the pig likes it.
All they want is your attention.
So I try to not comment or like or retweet or anything
or point out how stupid they are.
Even though I love pointing out
when people are wrong on the internet,
that's why we're both primarily on X and not Nostra, I think.
Yeah, everybody's too right on Nostra.
Yeah, but I absolutely love this conversation.
I think it's one of the most constructive ones we've had.
And take from it what you will.
More pro, more against.
Comment and like and subscribe and brush your damn teeth.
And I hope to see you soon again, Giacomo.
I don't know when the next time is.
Probably Prague, right?
Yes, we will be in Prague.
Yeah, fantastic.
And then after that, I'm looking forward to spending another week in Lugano.
one of my favorite places in the entire universe.
Well, Luke is so forward to have you back.
Students were already excited.
Fantastic to hear.
And give my hugs to Mir and everyone else at Plan B.
And till next time, cheerio.