Hey everyone, Michael here with the Bitcoin Way podcast. Thank you for tuning in. Today on the
show, I have Chris Guida. Chris is an outspoken developer and a big proponent of BIP110,
NOTS. He lays it all out. I think this was one of the best explanations I've heard
in one concise place where we talk about NOTS, the origins of the node debates and everything,
all the implementations, and we get into BIP110, what it is, why he thinks everyone should be
signaling it. You're going to love this discussion. It does get a little bit technical, but I think
it's high level enough that if you've been following Bitcoin for any period of time,
you're going to kind of track and hopefully you're convinced one way or the other at the end.
Hey, everyone. Like I said in the intro, I've got Chris here with me. Chris,
welcome to the Bitcoin Way podcast. Hey, Michael. Thanks for having me.
I appreciate you joining, man. This has been too long. We should have been talking about this a
while back. I've had a mechanic on, I've had sort of different perspectives. Pierre Richard came on
during the heat of the knots versus core debate. But when I get into some of the technical details
of BIP 110, I want to keep it high level enough that people can follow if they're not a developer
and I'm not. So I'm going to be asking these questions out of genuine curiosity. Let's start
just briefly, a quick background on you. You've been a developer for a long time, Bitcoin focused
now for several years. What was the moment that made Bitcoin resonate with you where you said,
okay, I'm going all in, I'm dedicating my time to this? Oh, man. Yeah. So I've been, as you said,
I've been a professional developer for a while, 2010 is when I started. I became a Bitcoin developer
in 2020. And the moment that I said, I want to be all in on Bitcoin, I think was much earlier
when I first got into Bitcoin, I was kind of always trying to find a way to get into Bitcoin
development because I was just so interested in Bitcoin and how, you know, how it can give you
freedom in your life. Basically, several years, maybe over a decade ago is when I first got into
Bitcoin. And I guess there were lots of things that just kind of pulled me in. But one of the
things I realized was that, I mean, so the real killer app for me was actually the Silk Road.
When I realized that, oh my God, there's a whole, you know, like Agora marketplace functioning
basically like outside the law. The people running it seem to be like these, like basically moral
upstanding people, but they just, you know, there's these certain, you know, substances and
whatever that are illegal for, in my opinion, not great reasons. But there's this payment system
that you can use that nobody can stop. And I was like, that was sort of, I guess,
the beginning of the rabbit hole. But I had already sort of started getting into
libertarian politics and sort of realizing how the financial system, the monetary system
is sort of very oppressive, but in ways that are not obvious. And I realized that Bitcoin can
provide freedom both on the individual level, but also on a societal level. And so I think
my sort of Bitcoin moment was, yeah, over a decade ago, I would say, when I realized,
oh, this is the way forward for humanity. Yeah, absolutely. I couldn't agree more with that.
Okay, so let's jump right in, because this could be a long conversation. I'm going to have a lot of
dumb questions for you. I've studied this and then forgot it. It's like learning Spanish for me,
right? If I don't use it, I lose it kind of thing. So a lot of these things are very fuzzy for me
right now. I haven't dug deep lately. So the technical crux of the debate that's been raging,
knots versus core, I think BIP 110 is sort of an extension of all of that, has been, as I
understand it, to be related to the SegWit witness discount. So data stored in the section,
It's cheaper than regular transactions.
And critics say that this was designed for signatures, smart contract features.
It's not for JPEGs, which is obviously a huge concern for many people.
Is that a good way of framing it?
How would you reframe that, perhaps?
So I agree that the SegWit discount has caused there to be more spam than there would be otherwise.
But I disagree that there's sort of an implication there that, oh, well, if we got rid of the
discount, then the problem will be fixed. And I don't agree with that. There are always going to
be incentives for people to put arbitrary data in the chain because Bitcoin's blockchain is very,
very useful for storing arbitrary data. What it's especially useful for is what we call gamified
spam, which is effectively shit coins, right? It's these token projects that they're pumping
and dumps, right? They're just a way for scammers to do a quick money grab by leveraging Bitcoin's
brand, right? It's basically like an, what's it called? Like an affinity scam of Bitcoin. They're
saying, oh, we're building on Bitcoin. So this is, we're all Bitcoiners and we're doing Bitcoin stuff,
but it's a lie, right? It's a big scam. And so they just, they do these pump and dumps. And
what happens is the people, their victims are trying to get rich. And so when they're not very
sensitive to fees. So the fees can go up to $50 or $100 per transaction, but these people think
they're going to be millionaires. So it doesn't really matter whether the witness discount is
there. The witness discount provides a 75% discount, which is significant. And if we lowered it, that
could maybe help a little bit. But the thing that keeps spam away, and if you study Bitcoin history,
you realize the thing that keeps spam away is an attitude of hostility towards spam.
And so we had this exact same battle a little over a decade ago, and it was called the Op-Raturn War. And BitMEX actually wrote a great article about it, which everyone should read, where basically Bitcoin culture was hostile to these spammy shitcoin use cases.
and there were people like Luke Dasher, Jeff Garzik,
and many other Bitcoin Core devs at the time
who were very hostile to these use cases
and basically put up a credible front of,
well, we're just going to keep fighting against this spam
and every time the spammers make a move,
we're going to make another move
and we're going to keep escalating until they go away.
And eventually what happened is there was this sort of compromise,
which is Op return, where it's known as like a garbage bin, you know, okay, well, the spammers
are going to spam. So, you know, let's just give them a place that's, you know, as harmless as
possible. And so that was Op return. And then the spammers went away for about a decade. And then
they started coming back with ordinals. So we're just having, you know, part two of that war.
So we really need to look to how we won historically and just do the same thing again.
Can you explain what's different?
Why did the spammers go away for a decade?
What was it?
And then why did ordinals and some of these other, what I would agree with you, sort of
shitcoiny, scammy sort of projects come about?
Was it just they figured out that there was a way for them to do these things using the
existing tools?
Yeah.
And so what happened in 2014 is that the spammers decided to go spam on other blockchains.
So at first they were like, well, you know, we can leverage Bitcoin security because Bitcoin
is so secure because it's the number one cryptocurrency.
And so there were people like the counterparty guys, there was Omni, and then there was Vitalik
with Ethereum.
And you can look back at his tweets.
he was thinking about building Ethereum on Bitcoin.
And he basically said, he explicitly stated
that he noticed that the Bitcoin devs
were hostile to use cases like his.
And so he knew that the Bitcoin core devs
were gonna be at war with him.
And so he decided to go build another blockchain.
And so what happened is the shitcoiners,
in that moment, that's when the shitcoin industry
was kind of born.
because all of the cryptocurrency activity
was going to happen on Bitcoin up until that moment.
But then when Ethereum came about,
all of the shitcoiners
and all these sort of fiat brain people
realized, oh, we can just make our own blockchain, right?
We don't have to do this on Bitcoin.
We can just go to this other blockchain
or this long tail of other shitcoins
and we can do our shitcoin use cases over there.
And basically what happened is the scams dried up.
everybody realized, oh, these are scams, you know? And so these pump and dumps have a certain life
cycle, right? Like you have to, they keep going as long as there's a, as long as the sort of shared
delusion can be maintained. The shared delusion can be maintained as long as there's a sense that
something novel is happening. So, you know, there was a big NFT craze on Ethereum in starting with
CryptoKitties, like in 2017, which made an Ethereum node impossible to run. But then it really sort of
reached its peak in 2021. And then it sort of crashed. And then after that, all of the NFT
scammers just kind of went away because the public had wised up to the scam. But then what happened
with ordinals is that something that appeared novel happened, which is that, oh, now we can do
NFTs, same as before, but now it's on Bitcoin. And so this felt novel again. And so the scam sort of
got this renewed energy. So that's really all that happened, right? It's these people who are just
these DGens who are like going to the casino and they're trying to gamble and they're trying to get
rich quick. Most of them are losing their shirts, but some of them are getting, you know, rich in
the short term. In the long term, usually they end up just blowing the money on something else.
But yeah, that's I think that hope that answers your question. Yeah. Yeah. So in your view is the
incentive, because like what I think of is we're going to have you're putting Bitcoin's future at
risk when you do these things. I'm not saying it's over. Like my conviction is still very high.
But you're putting Bitcoin's future at risk.
Is the incentive for the people promoting these what you refer to as scams?
And candidly, I generally agree with that sentiment.
When you say putting Bitcoin's future at risk, you're talking about the scammers are putting Bitcoin's future at risk, right?
Correct. Correct. Yeah.
So they are comfortable doing that, in your view, not because they aren't concerned about Bitcoin's future.
Like they, they, they're just, they're just hoping to get rich quick.
Like that's really what it amounts to.
And if Bitcoin dies because of it, who cares?
They made their money.
They got out.
Is that kind of the.
Exactly.
Yeah.
So there's, there's a kind of, um, you know, and, and, and, uh, this is very deep in, in
Bitcoin culture that, um, there's a certain darkness to fiat culture.
There's a certain, there's a certain, um, high time preference that, that fiat money
being the reserve asset creates in people.
It incentivizes short-term thinking.
And it incentivizes this exact behavior, right?
Like, oh, well, I don't have to plan for the future.
And I can't plan for the future.
Planning for the future is actually punished under a fiat standard.
And so my best path towards prosperity for myself and my descendants is to just try and
just keep rolling the dice.
That's kind of the best strategy on a fiat standard.
So if you're a fiat brain person and you've grown up surrounded by fiat culture and you're used to your money just kind of evaporating away all the time and you're looking for some way to get ahead, it actually is kind of a good strategy if you're sort of spiritually bereft to just kind of go to the casino and see if you can get lucky.
Okay. So is your position then that if people seek to allow Bitcoin to do anything because it's valid consensus, it's a valid transaction, it effectively becomes nothing because it's no longer peer-to-peer electronic cash.
And it just becomes whatever the hell anyone wants it to be. And in the future, it could be some other iteration of some sort of shitcoin scam on top of Bitcoin as well.
Right now, it's money versus arbitrary data.
It's a file storage database.
Is that?
Yeah.
So it's wonderful, actually, that we drove Vitalik to create his own blockchain because
Ethereum shows us all of the things that are going to happen to Bitcoin that wait down
this road of just kind of let the money printer have its way with Bitcoin.
um that exactly what has happened to ethereum is what is going to happen to bitcoin if we do that
and bitcoiners are very sort of libertarian minded they they believe in free markets but
what they don't realize is that when you just when you just say all behavior is is is you know
morally equivalent you know all and and and um the bitcoin system should not should not bias any
particular behavior over any other behavior um as long as you know as long as everything's paying
a fee per data. That's the only metric that we need to look at. What libertarians don't realize
is that we don't exist in a free market right now. We exist under a fiat standard, which is
actually very authoritarian. There's people who pull the levers to print the money. And those are
the people that are going to end up in charge of Bitcoin if we allow the free market to have its
way with Bitcoin. It's not really the free market, right? What's happening is that the fiat printer
comes in and captures Bitcoin. And if you want to see what's going to happen to Bitcoin,
all you need to do is look at Ethereum. That is what's waiting for us down that road.
Okay. So let me give you an analogy that I've sort of used in my mind. I think other people
probably used it too, but I want you to either poke holes in it or tell me if this is right.
So a group of people get together in a community and they're like, hey, let's design and build a
park for us all to use freely. Right. Um, and the intent of this park is for, you know, our kids to
play on the playground, for us to have picnics, to do all these things. And then you've got more
people show up and they're using the park for the same purposes as intended. And then more people
show up and they want to start putting graffiti on, on the playground and on the, uh, you know,
the, the, the pickleball court ground, you know, like whatever it is that they're doing.
And you say, look, technically, it's not like any of us own this. However, this was never the design. Take your graffiti and all the other things that you're doing, shooting off fireworks or whatever, take it somewhere else.
Like this was growing garbage or letting the dogs poop everywhere, you know, just kind of leaving a mess.
Yeah. So is that sort of the justification as an analogy? Is that sort of the justification you would use for saying, no, even though this is a decentralized thing that no one operates independently or centrally, that's effectively what this whole debate amounts to?
yeah i mean basically what what our opponents who tend to be core supporters are arguing is that um
well the the people who are using the park for for good things are going to price out the people
who are using the park for bad things and uh this argument is insane i don't know why anybody would
believe it yeah if you just if you just if you have two brain cells to rub together you realize
this is a silly argument um no that's not what's going to happen what's going to happen is it's
going, the park is going to get ruined and everyone's going to leave. You know, there needs
to be a, you know, even though it's decentralized, right? Even though we're all, you know, we're all
working together to make the park happen. There needs to be a sense of what the park is for
and what sorts of behaviors are acceptable. What sorts of behaviors are not acceptable.
The park has a purpose, right? If the park doesn't have a purpose, then yeah, it's fine to just let
anybody do whatever they want. But if the point of the park is for people to be able to go to the
park and hang out in nature and touch grass and throw a Frisbee and run around with their dogs,
then those are the sorts of activities that should be protected. And similarly with Bitcoin,
Bitcoin has a purpose. The purpose is to be money. And in my view, I don't think you should really
call yourself a Bitcoiner if you don't believe this, if you don't agree with this. But I think
Bitcoin's purpose is to be the next world reserve asset, or at least to be a future world reserve
asset so that we can replace the fiat standard with something more just. So that's its purpose.
So if there's all of this activity that's competing with that purpose, then Bitcoin is sick or dying.
So the sticking point to all of this is while Bitcoin is decentralized, and I would say credibly so, it should be more. We need way more nodes, in my opinion, running online. I mean, that's what we're all about the Bitcoin way. Self-custody, run a node, be self-sovereign.
we have this we have the reference implementation core and that is when if someone spins up a brand
new node and they know very you know they're brand new to bitcoin they've heard they should
run a node by default they're probably going to run core all else equal and there are a handful
of developers ultimately a very small group of people who centrally manage that you know and
And yes, there's area for public comment.
And I mean, we've seen some of this.
What's the solution to that?
Like, you know what I mean?
Like, is it just many implementations?
Like, would your hope be that Knotts isn't the only primary alternative and that we'd
have tons of implementations?
Or do you think we just need a few?
Is Core just, are they bought and paid for in your view?
I know these are a lot of questions I'm throwing at you.
Yeah, I mean, so I think that two implementations is much better than one.
I don't know why everybody is like, we need a third implementation.
I think we should focus on having a second implementation before we should focus on having
a third implementation.
But one implementation is obviously not good, right?
That's a central point of failure, as you've just noted.
It's very easy to see.
And I think we've seen very strong evidence recently that this has actually been happening,
how a single implementation can become corrupted and subverted
to serve the ends of moneyed interests, let's just say,
and to no longer serve the interests of the users, right?
The node runners, the people who are actually running the software.
So yeah, I mean, that situation is very bad.
How do we solve it?
I think that we should focus on making Notts more decentralized.
I think that people have this sort of loop derangement syndrome where they don't like
Luke for one reason or another.
I think those are irrational fears.
Bitcoin Notts is open source.
I think that it's totally transparent what Luke does.
I'm going to start trying to contribute to Notts actually more pretty soon, hopefully.
And, you know, a GitHub repo is centralized.
There's nothing that anybody can do about that.
There's the people who can, there's the maintainers, right?
There's the people who can merge the PRs into the code base
and make that officially the code.
And so, you know, it's not going to work if there's 100 maintainers.
And one maintainer is obviously not good either.
Five maintainers is what Bitcoin Core has.
That's pretty centralized.
One maintainer is what Bitcoin Nots has.
That's also pretty centralized.
That's even more centralized.
But what I don't agree with is people saying,
well, we shouldn't support Bitcoin Nots
because Bitcoin Nots only has one maintainer.
And I'm like, okay, well,
two centralized repos
are better than one centralized repo.
That's still a lot better, right?
So but yes obviously it would be ideal if there were many many implementations I think that would be the healthiest thing Yeah You have competition at least So okay So here I tell you how I
perceived this being rolled out was because I'm on X, right? So like I'm paying attention to the
debate there. I'm not a developer, so I'm not going through all the forums. Although I did go
back and revisit that and it's hard to follow if you're not a developer. But the way I saw it was
there was sort of a debate about this in the background amongst developers uh maybe some
censorship i mean we could talk about that too i'd be curious to hear your opinions but
in general there there was there was debate going on but then it felt like it more or less came to
the broader public and which happens to be kind of x which is a lot of the node runners right the
people who are into bitcoin are on x and they said this is what we're doing that was sort of where
for me, I got really turned off. Even if I agreed with the change, philosophically, I can't just get
on board with the fact that they wanted to make this change. And it was obviously a very contentious
topic. In that sort of environment, my default, or what seems to make sense to me is a default to
conservatism. Let's not make the change if this is that heated. And they proceeded anyway. Is that
a fair analysis of what you think happened. Do they need to pay attention to what people on X
are saying? Okay, so you think they do. Absolutely. Okay, so you hit the nail on the head. That is
absolutely right. And their disdain for X users is misplaced. So for one thing,
so as I said earlier, devs need to take into account the opinions of the people that are
running their software. If they don't do that, people will stop running their software.
And so that's why we saw after the PR was open to remove the operaturn limit,
we saw a big exodus into Bitcoin Noughts. And then once the PR was merged, you saw another
exodus after that. And it went up to 20%. I think it's around 25% people running Noughts.
this was perfectly predictable.
So another thing,
Bitcoin developers tend to be either not node runners.
They just have a salary.
They're just paid by one of these organizations
that funds Bitcoin devs.
And they don't necessarily own Bitcoin.
They don't necessarily run a node.
They don't necessarily align with Bitcoin values.
They just have a job.
And they're usually these sort of engineering types who like to tinker and solve interesting
problems and work on cool tech.
And that's great and all, but they tend to get lost in the weeds, right?
They tend to look at the trees and they don't tend to look at the forest.
So, and as I said, they tend to be just people who are getting paid to work on Bitcoin, but
who don't necessarily hold the Bitcoin values.
And the ones who do run nodes usually are running them for testing purposes, and they usually have very powerful machines.
So developers have very high salaries, and they can usually afford very high-powered machines.
And so when they have a lot of complaints about people having trouble syncing their nodes, for instance, a lot of times they just kind of dismiss those complaints as not realistic because they're like, well, I have a $2,000 computer and it syncs Bitcoin in half a day.
So why are people worried about this?
But when you're working, as I did, with actual merchants trying to get people to accept Bitcoin using their own full nodes, and you realize that merchants don't have $2,000 to spend on a point of sale system, you take a different perspective.
Um, so, but anyway, all this is to say that, uh, yes, devs absolutely need to listen to
people on, on, on Twitter who are, um, who are telling them in no uncertain terms, I am
running a node.
I am having problems running my node.
I have friends who I have, um, tried to onboard to running nodes and they're struggling.
Um, you know, uh, Bitcoin devs need to pay attention to that.
Um, and if they don't, then they're going to end up, uh, losing market share, which
is exactly what we've seen.
okay so to what extent these these bitcoin these core devs who are making these changes supporting
these changes to what extent do you believe and i'm sure there's some combination of these two i
don't think it's 100 one or the other but i could see it being there are paid interests in the
background and they are being asked to do operate in a certain way and their funding's dependent on
some variation of that. And then I think you've also got, to your point, my dad used to run a
software company and he worked with developers. And it's hard to find developers that are easy
to work with because they're so smart, so technically. Good ones are very smart, very
technical, and they want to engineer the hell out of everything. And sometimes what you need
is simplicity and you need someone who understands the business implication in this case. And for
you know, for Bitcoin, you didn't understand the monetary, you know, uh, incentives that are put,
put forth by the, the changes you make to what degree do you feel like core is influenced by
just excitable engineers versus there's money changing hands in the background to incentivize
particular changes? Um, yeah, I, I like to, I like to assume good faith whenever I can. Um,
You know, there are definitely moneyed interests that are involved with funding Bitcoin core devs that definitely have an interest in raising the opportunity limit, for instance.
But I think the devs themselves, as you said, they just tend to be people who are like basically good people who are, in my opinion, misguided.
Right. A lot of them came into Bitcoin with this.
So I think it's mostly ideological, right?
Bitcoin has this kind of, you know, like F the man, you know, we're going to replace the world order with a Bitcoin standard.
And we're going to do it without any violence.
And, you know, just people writing software and running software.
And there's kind of two different flavors of that.
There's the, how do I put this? There's the kind of more, less realistic, more utopian version,
which actually you can see in certain strains of anarcho-capitalism, which where,
basically, it's kind of like communism, right? Where, okay, we all just have to be good people,
and we all just kind of have to help each other out.
And then society will just like magically work.
There's that kind of dominant ideology among Bitcoin devs
where, okay, Bitcoin is just going to kind of magically work.
And if it becomes under attack,
it will just kind of magically do some kind of Tai Chi move
and avoid the attack.
But it doesn't need to counterattack or do anything defensive.
So, you know, nobody needs to like consciously provide for the collective defense. That's
basically what I'm trying to what I'm getting at. There's a strain of libertarianism or
anarcho-capitalism that just kind of denies the problem of collective defense. And then you have
the other side of anarcho-capitalists or libertarians who understand that you need some
kind of sheriff, you know, some kind of defense force who takes responsibility for collective
defense. And this is not, you know, this is not statism, right? But it's a more realistic view.
And you can see this by, I mean, we can, it's a whole nother conversation.
But the upshot- It's like the militia, right? It's not a central power having a standing army,
it's the people organizing. And in this case, maybe that would be the node runners, for example.
The node runners, exactly. Yes. The node runners need to be conscious of what they're doing.
They need to be taking active choices.
When a certain group of developers gives them the option of running a certain piece of software,
they have to consider that piece of software and be like, is this a good idea to run?
Or am I going to take this other software?
Because I think that's better in the long term.
You need to have a group of principled, long-term thinking,
you know, based node runners, you know, who are going to stand up and fight for Bitcoin survival
and not just roll over when the free market says that Bitcoin is for free is for data storage.
Yeah. So so I agree with that. What concerns me long term is that we are still at least best I
can tell in sort of the I mean, at the earliest I mean, or I'm sorry, the latest we're in like the
early majority phase of Bitcoiners coming online. I think we're probably even pre early majority
coming online. We're still very early. And when I think out 20 or 30 years, who are the next batch
of node-orders going to be over that period of time, it's going to be a lot harder to muster up
a new crop of libertarian minded people. Do you have any long-term concern with what you just
described that that's what Bitcoin is going to sort of depend on is the guy who you've been
talking to about Bitcoin for 10 years now, trying to get him into it, buy some, hey, learn about
self-custody, run a node. And he's just at every turn it's been known, yeah, maybe someday. And
then eventually that guy's going to be a node runner, or at least he's going to be a Bitcoiner
because I think you're going to have to be. It's the monetary gunpowder of our age, in my view.
Is he going to have the ability to discern in the future what type of node, what software he
should be running and what changes are hostile toward Bitcoin as a form of money? Yeah, I mean,
it's a difficult question. And, you know, we just kind of have to, it's an iterative process,
right? We just have to watch as threats develop and we have to be very vigilant. And when
stuff starts to get bad, we have to see if we can recruit people to the cause, you know?
So, hey, and Bitcoiners tend to do that, right?
They tend to rise to the challenge.
When Bitcoin is under threat, they tend to understand this and they tend to be agentic
people, right?
They tend to be people who can get stuff done and who are willing and able to make a real
difference in the world.
And when duty calls, they are willing to do that.
And we've seen Bitcoiners do this again and again.
And, you know, as I mentioned in 2013 and 2014, when we were having, you know, spam war part one, we saw a bunch of node runners come up and say, yeah, we're going to run these filters.
We don't like this spam, you know, you know, and a bunch of miners back then.
There used to be a lot more principled miners back then.
That's definitely a problem.
Um, um, but yeah, I mean, the, the, the hope is that, you know, as threats develop, the
threats develop slowly enough that people can, can catch them developing before they
become, uh, fatal.
Um, and, and, and Bitcoiners rise to the challenge to, um, to repel the attack.
Um, so.
Yeah, no, I think that makes sense.
And what gives me hope is like, I've got three kids, one on the way, and they're all going
to be running their own node in their teens.
You know, like I'm going to be teaching them self custody and they're going to, you know, earn in Bitcoin and that as early as possible.
And so one guy myself who just tripped into Bitcoin a few years ago is going to, you know, offload into the world for new node runners who are hopefully critical thinkers and principled in their convictions and can make that discernment.
And it seems to me like Bitcoiners tend to populate the earth at a higher rate than many other cohorts.
So I'm hopeful, but I wanted to hear your perspective on that.
Okay, so let's talk about, we're going to get to BIP-110, I promise.
I want to hear your take on this distinction between knots and core, because my understanding
is some high 90%, they're the same, right?
Like it's 90, they're 99% the same.
And there are some configurations in each that are different for a very specific purpose
and for nots in order to fight what Luke and folks like yourself view to be spam.
How would you explain how these two implementations operate differently?
Yeah, I mean, it's an interesting question.
I think that Luke has a more specific vision for Bitcoin than Bitcoin Core does.
Bitcoin Core seems to have this very diffuse vision of Bitcoin that doesn't, in my view,
it's very unfocused and incoherent.
It's kind of just like, okay, well, whoever contributes is the one who gets to say where
it goes.
And then as I alluded to before, there's funding that sort of tends to drag developers'
interests in a particular way.
And when there's a fiat money printer printing the reserve asset, it tends to go in that
direction, in a more fiat direction. And so I think Luke's vision for Bitcoin is more
Bitcoin centric. It's more node runner centric. Luke's philosophy is the same thing that you just
said, which is there should be as many node runners as possible. The number of node runners
is pathetically low right now. Everybody needs to be run. I mean, there's no reason why in the
future, everybody, every human in the world can't run a node. The only reason is that the limits,
really the block size limit, was set too high. I mean, that's basically what it is.
And, you know, so, but the good news is that Moore's law increases exponentially.
So what that means is that computing power and, you know, and resources are always
increasing exponentially with respect to cost. And so what that means is that the cost of running
a Bitcoin node should be decreasing exponentially over time. And so basically as long as we keep
the UTXO set limited in size, and this is the big problem that happened during the spam attack in
2023 and 2024, was the UTXO set exploded in size. And that's why we saw node runners struggling to
do IBD, and the cost of running a node, the minimum cost of running a node rising instead
of falling exponentially as it's supposed to do, as long as we keep that under control,
the block size limit takes care of the rest.
But Luke has a great talk about this from 2019 or 2021 or so, a few years ago, where
he talks about why the blocks need to be small.
And it's basically because of this.
We want the technology to catch up and surpass the growth of the blockchain.
And if it does that, and if and when it does that in 10 or 20 years, you're going to see
the cost, the minimum cost of running a node become cheaper and cheaper and cheaper and
cheaper.
And eventually, any random person is going to be able to sink a node in under an hour
for $5.
But we have to focus on that as an outcome or it won't happen because there's all of
these other forces that are trying to make Bitcoin nodes harder to run.
So, yeah, I think that's a long answer.
No, no, that's helpful.
So is the incentive in your mind for people to run a node who, like, you know, I mean,
you've obviously been very deeply involved in Bitcoin.
I've only been around for four years, but I, you know, I did my 2000 hours of podcast
listening and read all the books, you know, like I've sort of checked those boxes.
For me, it's an act of self-sovereignty.
Philosophically, I could not run a node, right?
But I also have an economic interest to run a node.
I mean, there's privacy,
I wanna add decentralization to the network
that my net worth is highly dependent upon.
In your mind, is the incentive going to be
for the next cohort of Bitcoiners who come online to say,
I have an economic incentive,
I need this network to maintain its decentralized nature
to grow in its decentralized nature because my life depends on Bitcoin remaining secure and
decentralized. Is that going to be enough, do you think, for many, many people? If they just
understand that one thing, they don't have to understand all the nuts and bolts and how mining
works and all these things, but if they can just grasp that, is that the incentive?
Yeah. I mean, I think the key fight that's happening right now, especially with Bit.1.10,
is going to be cultural.
If we can keep,
if we can preserve Bitcoin's culture
as a Bitcoin-centric culture
and avoid Bitcoin
from sliding into fiat culture,
which there are strong forces on it
to do that because of funding
that comes from fiat VCs,
if we can keep Bitcoin's culture strong,
then it should be fairly easy
to beat that drum
and keep teaching new Bitcoiners,
You know, run your node, make sure you know what's going on. Don't trust anybody that didn't earn your trust. You know, don't, yeah, don't trust Verify. You know, become a Bitcoin dev, learn the technology. It's not as hard as it sounds. You know, it's, especially now with LLMs, you know, you can just go and you can, you know, ask the LLM, like, hey, explain to me this technical concept. And it's really not difficult concepts.
The thing about Bitcoin that's hard is it takes a lot of time because there's a lot of concepts.
But it's just a lot of simple concepts that build on top of each other.
And so all you have to do is just put in the time and eventually you'll get to the point where you don't need to trust anyone.
But as I said, I mean, we have to win this cultural battle.
And Bit.10 is primarily a cultural battle.
I mean, it's primarily a, are we going to let fiat culture invade Bitcoin and displace Bitcoin culture inside of Bitcoin, which obviously would be fatal? Or is Bitcoin culture going to win? And is Bitcoin spirit going to survive? Is Bitcoin survival instinct going to survive? And are Bitcoin maximalists going to win the day?
yeah that's a good it's a good question so the core the core side says that filters don't work
miners are going to include these transactions anyways you've got things like slipstream uh
from mara um and basically you end up playing whack-a-mole is is kind of which to me it sounds
like what you've described is the anti-spam camp playing whack-a-mole over the years and just
trying to you know the spammers do something you respond they do something else you respond again
is that just the game of the game here? Yeah. I mean, the, the, I mean, yes,
it's a cat and mouse game. I mean, the,
the fight for freedom is a cat and mouse game.
The fight against tyranny is a cat and mouse game.
The tyranny always comes back and we always have to fight it.
This is not something that can just be a one forever. You know,
and this is what I mean by the,
these core devs who have more sort of communist leanings or utopian leanings.
They think that there's,
there's going to be some kind of technical solution that's just going to solve the problem
forever. And that's, you know, just study history. That's obviously not going to happen.
Now, the good news is that, so the will to fight spam is one of the most important
one of the most important features or aspects of the battle against spam. If you think that
spam is something that can be defeated, it becomes something that you can defeat. If
you think that it not something that you can defeat then it becomes a much more difficult problem And this is precisely the strategy of the spammers right They want to kind of demoralize Bitcoiners
and make Bitcoiners believe,
oh, there's nothing that we can do to stop it,
so we might as well just let it happen.
And so, but obviously this is voices of darkness,
who are tempting Bitcoiners down a dark path.
Let's not listen to those voices.
In the past, we easily defeated the spammers
because the core developers were willing to play
that cat and mouse game.
And all they needed to do was commit to playing that game,
just commit to escalating.
Whenever the spammers come back with some new thing,
we just escalate even more.
And so the last time this happened, the last Spam War
Part 1 in 2013 and 2014, we fought them in policy.
We fought them with filters because that's all we needed to do.
There's a reason why in evolution animals evolve sort of menacing behaviors or growling behaviors.
Bitcoin should have the ability to say, hey, we don't like that.
Stop doing that.
That's hurting us.
And that's what filters do.
Filters are this kind of voice that says, hey, this behavior is unacceptable.
And these words are backed by force, right?
Like an animal is not going to have like a threatened disposition if it can't back up
the threats with force.
And the consensus rules are force.
And so back in the day when we were fighting spam, the devs just needed to say, hey, we're going to filter your spam because it was implied.
We're going to find some way in consensus to block this stuff if you don't back down.
And so the spammers just said, OK, well, we're going to go somewhere else.
So usually that's all you need to do.
But when core, when the dominant Bitcoin implementation is on the side of the spammers,
then that's a much worse situation for Bitcoin node runners.
Because now the dominant node implementation is saying there's nothing we can do to fight
spam and we absolutely commit to never attempting to fight spam.
So what's that going to do?
That has the obvious effect of now the spammers are going to be emboldened.
Now the spammers are going to redouble their efforts.
They're going to like, there's a whole shit coin industry out there that wants to come and spam Bitcoin and turn it into Ethereum. And if we don't do anything about that, that's what they're going to do. So, I mean, it's really unfortunate that that core sort of betrayed us this time around. But, you know, so we're so we have to take the battle to the consensus layer. So that's what we're going to do.
Okay. So one last question before we get to the battle at the consensus layer. Some of the core, I guess, the core sympathizers would argue that filters could actually increase mining centralization because they push transactions to out-of-band channels controlled by obviously like the large miners.
How do you think about that trade-off?
And if you're willing and able, if you could sort of steelman that argument and then dismantle it in sort of whatever way you see fit.
Yeah, so the steel man of that is that if we have direct miner APIs like Slipstream,
then if node runners are filtering en masse kinds of transactions that are commonly mined,
then you could end up creating an advantage for,
I mean, it's kind of a long, hairy technical debate,
but there's a lot of moving parts.
But basically there's these things called compact blocks.
And when a new block is found,
that block is propagated throughout the network
in sort of a summarized form
so that the block propagation can happen really fast.
And you want block propagation to happen really fast
because you want the network to stay in consensus.
You don't want, if two blocks come out really, really fast,
kind of one after the other, or immediately at the same time,
you don't want a situation where one part of the network
is building on this block, and the other part of the network
is building on this other block, because then you
get network partitions, and you get forks,
and you start to have double spend risk.
Not a big problem, but minor centralization
comes in where, OK, so if there's
a kind of transaction that's being commonly mined,
but most of the nodes are ignoring that transaction,
then those blocks become very slow to propagate.
And if that happens, then you could have large miners
who have 20%, 30%, whatever of the hash power,
you could have them, basically they know about the block
before the rest of the network.
And so they have kind of an advantage
and they can start building on that block.
And then they have kind of a, yeah,
They have a few seconds of head start on the rest of the network.
The thing is, there's a bunch of reasons why this doesn't hold water.
The first is that the type of transaction that was the rationale for removing the opportune limit does not cause this.
Because this was a justice transaction, a fraud-proof transaction from Citria that is never supposed to happen.
So I don't know how much you've read about this transaction, but it's basically, it's like a, you know, it's like a, you know, shit went really sideways.
And the coordinator that's running the network is trying to screw people out of their money.
And so, you know, the watchtowers have to, like, post this fraud proof as fast as possible so that people can get their money out and slash the coordinator.
But, yeah, it's never supposed to happen.
So the thing is, this particular transaction
was the rationale for getting rid of the operaturn limit.
But this transaction is never expected to happen.
And if it does happen, it only needs 64 bytes.
So it needs 144 bytes.
So an operaturn that fits this transaction,
if we had doubled the operaturn limit from 80 bytes
to 160 bytes, that would have been sufficient
for this transaction.
So I mean, yes, there's these extremely
extreme edge cases that are totally not at all relevant to the PR that removes the operaturn
limit, where mining centralization could be remotely relevant, but it isn't. And the other
reason why it's not relevant is because miners can do selfish mining attacks anyway. So basically,
the attack that they're... Well, actually, there's two reasons. The first reason is that
miners can already do a selfish mining attack.
So this is where a miner mines a block
and then doesn't announce the block at all.
And then they just keep mining on top of that block.
And if they have a high enough hash power,
they can kind of attack the network
by constantly just messing with the chain
and sending these three block reorgs to the rest of the,
basically keeping the rest of the network kind of in chaos
and messing with smaller miners.
But this is an attack that they can already do intentionally.
So the worry is that, OK, well, miners
would do this attack unintentionally
because their blocks are propagating more slowly.
And the other thing that makes this argument completely
irrelevant is that miners don't do this because they don't
want their blocks to propagate slowly.
They want the whole network to build on top of their block
because it's very, very improbable
that they will find that next block.
So they don't want their blocks to propagate slowly.
And actually, if you look at the compact blocks release, the release of Bitcoin Core that included compact blocks for the first time, it actually said the reverse of what Bitcoin Core developers are saying now.
It said, hey, miners, you probably need to adjust.
You probably want to adjust your filters to mine only things that are commonly filtered, you know, to mine only standard things.
Because if you don't do that, your blocks are going to propagate more slowly.
So back in 2016, this was seen as like a, you know, a thing that miners should definitely want to do.
And I see no reason why that same argument isn't relevant today.
And also, it would seem to me like if you have set up the infrastructure such that you have 20, 30 percent of the hash power on the network, you have a very strong, I mean, unless you're just an arm of like the CIA or something operating with, you know, federally funded dollars in sort of an opaque fashion.
And it would seem to me like your incentives align such that you don't make people question
the integrity of the network and you try to keep it.
You're incentivized to make the network strong and to play by the rules.
So that way people don't, there's not an exodus from Bitcoin because there's a bunch of monkey
business.
That's basically, yeah, yeah.
Exactly.
And Satoshi wrote this in the white paper.
He said, you know, basically my consensus system doesn't work if more than half of the miners
are dishonest.
And so I would see them as a hostile miner. They are mining things that the network says are abusive. So that's a hostile act. And so we should take action with our miners that are explicitly dishonest. We should take action to boycott them and otherwise make their lives more difficult.
Yeah, it all comes back to kind of the theme that's run throughout this conversation is basically as a culture, we need to act in such a way as to disincentivize bad actors from operating on the network and let them go play on Ethereum or some other shit coin rails.
Okay, man, let's talk about BIP-110.
okay so i'm i'm gonna be honest with you everything that we've talked about
up to this point i've i'd sort of done my research forgotten a lot of it but it's coming back to me
now bip 110 is not something i have had a lot of time to dive into um could you put into simple
terms what bip 110 is and i mean to the extent that it's useful maybe kind of break down like
how bips work sort of generally for for anyone who isn't isn't familiar with the concept um yeah
You don't need to get into the weeds on that.
But if it's helpful at all to kind of describe how BIP-110 came about, feel free.
Yeah.
So I don't know if we're going to have time to go into the BIP process.
And I mean, so just to summarize BIP-110 specifically, and then if you want to like double click on anything and go deeper, then we can do that.
But just to kind of summarize where, in my view, where BIP-110 came from is, you know, so basically as we've been talking about,
There is this, there was a standard on the network
starting in 2014 that transactions that include
more than 80 bytes of arbitrary data per transaction
were non-standard or abusive.
And that the Bitcoin node runner community came together
and said, this is the maximum amount of arbitrary data
that we want to allow per transaction because Bitcoin
is not for arbitrary data storage.
And so when the operaturn limit was removed in October, I think is when they released version 30 of Bitcoin Core, when that happened, Bitcoin Core effectively unilaterally hard-working policy.
So there's a, like, it's kind of a metaphor and kind of not.
And for your listeners, if they don't
know what the difference between a hard fork and a soft fork
is, a hard fork is where you expand the rules.
And a soft fork is where you restrict the rules.
And so the great thing about Bitcoin
is that it tends towards stability because,
or it tends towards conservatism because soft forking
is much easier than hard forking.
And that makes sense when you think about it.
You know, if some of the nodes would like to restrict the rules
and they want to be pickier about what types of transactions
they're going to accept,
then they can simply reject blocks that don't do that.
Whereas a hard fork,
if some of your listeners were around for the block size wars,
you'll remember that the big blockers wanted to hard fork Bitcoin
to a larger block size.
And this was non-viable because hard-forcing Bitcoin
is very, very difficult.
Because when you loosen the rules,
the old nodes will not accept those new blocks.
So the old nodes say there is a limit of one megabyte per block.
And if we want to raise the limit to two megabytes per block,
all of the old nodes who haven't upgraded
are going to reject those new blocks.
As soon as somebody mines a block that's two megabytes,
they're going to reject that block.
And so this is ultimately why Bcash failed,
because they were trying to hard fork Bitcoin.
And SegWit actually did end up increasing the block size,
but they did it in a way that was backwards compatible
with the old nodes.
And this is why SegWit was victorious,
while Bcash was the loser.
So going back to the hard forking policy,
This is a new thing that I just came up with.
So basically, you know, so Node Runners had decided from 2014 that the amount of arbitrary
data allowed in a Bitcoin transaction is 80 bytes.
And then when Core said, OK, we're going to raise that limit to 100,000 bytes, that was
a loosening of the rules.
And in consensus, this is a no-no, right?
You don't hard fork Bitcoin.
I mean, like there's very, very edge case scenarios where you can, but generally speaking, you
can't do that.
and certainly not unilaterally, and certainly not
in just a few months like Bitcoin Core did,
with obvious pressure from the shitcoin industry.
And so as we were talking about before,
if node runners are not able to suppress the bad behavior,
the abusive behavior, the spamming, in policy
because the dominant node implementation
has suddenly become a turncoat, has suddenly betrayed the Bitcoin node runner community,
and has decided unilaterally that 100,000 is now the limit instead of 80, when that happens,
the only backstop, the only fallback is changing the consensus rules. And so
So leading up to bit.1.10, bit.1.10 was originally proposed by Luke, and then was later taken
up by another developer called Dathan. And what it says is that we can temporarily invalidate
transactions that have more than 80 bytes of arbitrary data.
And when I first was participating in these filter battles,
I didn't realize that, like it seemed to me
that you can't fight spam in consensus
because the way that information theory works,
and the core devs will tell you this,
and there's a great BitMEX research article
talking about it, you can't put in the consensus rules,
no spamming, right, where Bitcoin is money.
You can't do that.
But what you can do, BIP 110 is making me realize,
is that you can temporarily limit certain transaction
formats that are known to be stored on arbitrary data.
So that's what BIP 110 does.
It basically is the next level of escalation beyond filters.
If filtering doesn't work, usually filtering works,
because the dominant node implementation
is filtering abusive transactions.
But when the dominant node implementation betrays
the node-runner community and says, well,
we're not going to do that anymore,
because filters don't work, even though they do, then.
And that can, in retrospect, that actually
is very likely to happen, because there's
this thing called the tolerant minority in policy,
where if you just have a few percent Libre Relay, whatever,
a few percent of node runners that are very tolerant,
and a few miners that are willing to go against the standards
on the network, then anybody who wants
to send that transaction is going
to have a pretty easy time of it.
So you really need a strong political will
and also a strong technical ability
in order to filter that stuff at the policy level.
But what core devs did not tell you about
is that at the consensus level, there's
an intolerant minority.
So in policy, there's a tolerant minority that says, oh, well,
there's a bunch of people posting JPEGs.
Well, we're just going to allow that.
And we're 5% of the node runners,
so we're basically making the standard from the network.
But in consensus, it works the opposite way.
In consensus, if you have just a few percentage
of the node runners that say, we don't like this,
then it's very easy for those node runners
to restrict the rules further.
And so all this is to say, the more I've looked into BIP 110,
the more I've realized that it is kind of the ideal next step.
And if it activates, I expect it to be very effective.
OK.
So describe what it's doing exactly.
I think you sort of touched on it, but you gave sort of a narrative, which I think was very helpful, around context for it.
What exactly does BIP110 do?
Why is it?
Something is temporary.
It doesn't filter out these, or it doesn't, explain that.
Yeah. So basically what Bit.10 does, if you look at the rules, it takes all of the transaction formats that can be seen as officially supported ways of storing arbitrary data in the Bitcoin blockchain.
It takes all of these commonly used formats and some additional formats that could become standard if Bitcoin Core continues to loosen policy.
It takes basically large operaturns and inscriptions, and it says these are consensus invalid for one year.
And so that communicates that Bitcoin is not for arbitrary data storage.
And because it's not for arbitrary data storage, it is money.
It sort of reaffirms that Bitcoin is money.
so so is the intent then that is the reason it's for one year to sort of minimize the
i guess the the the blowback from some people who might say who might say hey this is
does it just give us a runway to use bitcoin as money to weed out the spammers for a period of
time so that way they go build somewhere else or they stop like what happens after a year i guess
is maybe my concern.
Well, so making the fork temporary
allows us to invalidate things that we wouldn't otherwise
be able to invalidate.
So BIP110 turns off a thing called op if inside Tapscript.
And this is something that is, as far as people can tell,
is not used anywhere actively except by inscriptions,
right, inscription spam.
And so there could be some risk.
So we've never tried it.
The last time Bitcoin turned off disabled behavior
that was previously allowed was back in the days of Satoshi.
I think there might have been some other force since then
that I'm forgetting.
But this is something that rarely happens on Bitcoin And so there could end up being some people who have their funds frozen for up to a year because of that
And people who are not spammers, right?
People who are using this very edge case thing.
Again, there aren't any known examples of people who have their funds frozen.
Hypothetically.
Yeah, hypothetically, if those people did exist, then at the end of the year, they could withdraw those funds. And then the other reason is because the way that Bit.1.10 operates is it turns off what's called upgrade hooks.
So these are things like future SegWit versions and unknown Tapscript versions.
And these are, they're called hooks.
They're like places in script that don't have a defined definition right now.
But in a future soft fork, the software could redefine them as something specific.
So all of the proposed upgrades to Bitcoin script, so like CheckSig from Stack and like
OpCat, I think, and GreatScript Restoration and BIP360, and all of these are turning on
new versions of Bitcoin script, and they're using these upgrade hooks.
and basically those will become unusable for a year.
So Bitcoin would not be able to turn on any new functionality
during when Bit.1.10 is active.
And so if we were to make those rules permanent,
and so it does that in order to prevent spam
because those can be abused, right?
Those upgrade hooks can be abused to store arbitrary data
in the blockchain.
So Bit.1.10 turns them off in order to sort of preempt that.
But that's not something that we can leave as a permanent situation because then Bitcoin would not be able to have any soft forks that upgrade the protocol.
Okay.
So when you think about things like, I know it's sort of a point of FUD at the moment, but you think about like quantum resistance, that sort of stuff.
You eventually need some malleability to adopt those types of changes.
Not for engineers just tinkering and having fun, but new threats emerge.
You need some level of ability to modify and sort of play the new game that's being played,
I guess, as time goes on.
Yeah.
And again, I've read the BIP very closely.
It explains all this.
It's very unlikely that there will be some emergency upgrade that Bitcoin needs to do
in the next year.
But if magically there is some kind of quantum resistance or whatever that Bitcoin needs in the next year, then that's fine.
It'll just activate as soon as Bit.1.10 is no longer active.
And one more thing about the temporary nature.
This goes back to what I was talking about with information theory, where you can't stop spam with permanent protocol changes, because there's always going to be ways around the spam.
But what a temporary software allows us to do is it allows us to fight spam and consensus, basically.
It's not something that we should ever have to do, but it's a very, very, very useful and vital tool, I think, for Bitcoin to have moving forward if we want Bitcoin to stay money.
Yeah.
We need to be able to say, hey, arbitrary data storage is not okay, so we're turning off all of the popular methods of arbitrary data storage.
Okay.
So BIP-110 has a mandatory activation date sometime this fall.
um and that that's regardless of minor signaling right so my my understanding is support's growing
right uh but what happens if it activates we don't have sufficient minor support like how does this
actually work you know like what do we need to have happen in order for your vision for how this
should play out to play out and what could go wrong in the midst of that and if it does go wrong
what does that mean so um were you around for the block size war no man i'm i'm still a noob
okay so in the block size war so so i read the book okay cool yeah you read the block size war
book by uh jonathan beer yeah yeah very good book everybody should read that um yeah it
basically bit.10 does the same thing um uh the difference is that so segwit segwit was given a
year of signaling.
And then it was given a deadline at the end of the signaling
period.
And at the end of the signaling period,
if insufficient hash power was signaling for SegWit,
SegWit would be canceled.
And so a few months into the signaling period,
we kind of started realizing that this was a mistake,
because there were some hostile miners that were blocking the fork
from activating, namely Bitmain.
and they're lackeys.
And so what ended up happening is that a group of developers
got together and put out a different version of Bitcoin,
a different activation client for something called BIP148,
which was the original UASF.
So this was a soft fork to start rejecting blocks
that were not signaling for SegWit.
And long story short, leading up to the activation of BIP-148,
100% of the miners started signaling for SegWit.
So if you look into the incentives for miners
and why this happened, it becomes very obvious
why they did this.
Because miners are just trying to get paid.
They're not trying.
And we shouldn't be leaving protocol changes up to the miners.
That doesn't make any sense.
The node runners, you and me, we should be in charge of the rules.
And the miners are just employees.
The miners should just, you know, I mean, like you could see a situation where there's
some kind of simple attack on the network where, you know, some three-letter agency
like spins up a bunch of fake nodes and tries to, you know, you know, turn on Ethereum or something
like that, you know, turn on a bunch of MEV, a bunch of, anyway. But this is clearly not that,
you know, if you, if you look on, on Twitter, as you were, as you were saying, you know, this,
this clearly has support among, you know, real actual Bitcoiners who really, really are looking
out for the long-term interest of Bitcoin. And it's not turning on any, any new functionality,
It's just a protective measure.
It's just disabling some things that are abusive.
But anyway, so the mandatory signaling period
is basically building .
It's kind of like if you took SegWit and you built
BIP 148 in from the beginning.
So that's all that .10 is.
It's basically if SegWit had been done in a way
that it doesn't put the miners in charge
from the beginning.
Instead of putting them in charge and then being like,
whoops, we shouldn't have done that.
The users are in charge.
do it uasf and and then the miner start signaling so bit 110 just does that same thing but just all
in the same package from the start okay so i've heard many people on the core side like the the
loudest ones and probably the most some of the most notable say that the knots bip 110 crowd
sounds like the big blockers of the of the block size wars what what exactly are they i know you're
you're shaking your head. What are they, what, what's their argument? Like what, what are they
referring to when they say that? Cause like I, I read the book, but again, I'm not a developer.
So there was a lot of it that was just kind of over my head. I kind of understood conceptually,
but it's, it's also been a while since I read that. Yeah. I think the steel man of that is that
we are opposing Bitcoin core and Bitcoin core was seen as kind of the, the victors of the block size
war. But I think this is a misreading of history. And actually, if you read the Block Size War book,
it explains that a lot of the core developers were actually against doing the UASF.
And if it had been up to core, SegWit would have failed. I'm now pretty much convinced of that.
And basically, it was just a few developers who were willing to be like, no, we are not
leaving this to chance. We are turning on SegWit. SegWit is the solution. We are not leaving the
miners in charge. So I think the steel man of the case that the knots people or the BIP110 people
are the big blockers is that, you know, that we're opposing Bitcoin core, which I think is silly. I
mean, I think, I mean, I think it's true, right? I think we are opposing Bitcoin core, but I don't
think that makes us the big blockers. And I think if you look at all of the other ways in which the
core supporters are like the big blockers, it makes a lot more sense. So like, for instance,
It's, you know, so as I was saying before, you know, Luke's philosophy and my philosophy
is very much that we want more node runners.
And fighting against spam allows there to be more node runners because it increases the
benefits and lowers the costs of running a node.
So this much is obvious.
And the big blockers were saying, oh, it doesn't matter if fewer people run nodes.
Let's just make the blocks bigger anyway.
there will always be at least 100 node runners or there will always be at least 1,000 node runners
or something like that. They had this idea in their head, oh, it doesn't matter because there
will always be enough, right? But if you just don't care about the costs and you just blow the
lid off of the costs and at the same time, you cripple Bitcoin's usefulness as money, right? So
by enabling all these spammy use cases, you're making it harder for merchants to onboard,
right like if you've ever tried you know onboarding uh anybody to self-custody and the fees are 50
dollars you can't you kind of look like a scammer they look at you and they're like who's this
scammer you know this bitcoin thing seems like a scam um so you know so fighting spam is is good
it it helps bitcoin be better money it helps bitcoin be be healthy it helps it uh fulfill its
uh its purpose okay so i don't remember if i was answering your question there no no no i think you
did. So let's start to round this out. So if BIP 110, I guess I would just say broadly,
what you're hoping for, if it doesn't play out the way that you intend, and I don't know if this
is maybe the way of saying it, but if Core sort of wins this battle, so to speak, does that
fundamentally change your conviction in Bitcoin? Does it alter the way that you view its future,
its likelihood of succeeding in the ways that you and I hope that it does?
Do we see an exodus of people from Bitcoin
because they've lost hope in the project?
What do you think?
100%.
If Core is able to unilaterally
effectively hard fork policy
against the will of most of the node runners
and
Bitcoin loses the will to fight spam
and through that
all these Ethereum use cases flood into Bitcoin
and through that Bitcoin turns into a big casino
that's no more innovative than Ethereum
and you know
Ethereum is a joke
and people think oh Bitcoin will magically
no longer, will magically never become Ethereum. And that's not true. Bitcoin will avoid becoming
Ethereum if Bitcoiners prevent it from becoming Ethereum. We, you know, the buck stops with us,
you know, the node runners. And if we let Bitcoin turn into Ethereum, it will become
a plaything of the fiat money printer. And it will not threaten, it will not disrupt anything.
It will not be capable of disrupting anything. It will just be this mindless, purposeless
thing that isn't money anymore. Yeah. As an analogy, you hear, fix the money,
fix the world. And I used to say that very flippantly. And I don't believe that anymore.
I think human action fixes the world. And our money in Bitcoin in particular is a tool to do so.
And so I've grown more convinced of the cultural necessity of what you've described here. And
I think it makes a lot of sense.
I don't have the technical chops
to agree or disagree with what you've just described.
I'm hopeful that you're wrong
because I don't know which direction we're headed.
But in the meantime, the way I...
I mean, this is it, man.
This is...
If 5.10 doesn't activate, the future is dark.
Okay.
Yeah, because in the meantime,
I'm the, like, where else am I going to park my wealth, right?
I mean, like, it's Bitcoin or it's, you know, a Tesla stock.
I don't know.
So, I mean, this is our shot and why I wanted to have you on to discuss this.
Okay, so for someone who's listening to this podcast, maybe just being introduced to all
these concepts, I'm sure most people who are listening to a Bitcoin podcast of this nature
are acquainted with the notion of BIP 110 and the NOS versus core thing.
what should they focus on and care about here?
What's your guidance for people?
Is it just run a node, run knots, signal BIP 110, that's it?
Or is there maybe more to the story?
I mean, there's all levels of analysis
from zoomed all the way out to zoomed all the way in.
And I think our priorities should...
I think our priorities become straightened out once we realize what the absolute widest,
the absolute most zoomed out view is, which is Bitcoin becoming the reserve asset.
And in order for it to do that, and in order for it to, I mean, so
there are ways that Bitcoin could become the reserve asset and become centralized. And if it
does that, it still fails. So it has to become the reserve asset, but it also has to stay
stay decentralized. And so the way that I put this is Bitcoiners have to value decentralization
and integrity. And they have to value Bitcoin being money because, I mean, that's at the end
of the day, Bitcoin isn't useful at all if it's not money. It isn't anything if it isn't money.
So what I would say, so everything, all the more zoomed in levels of analysis should flow from
that. So that should tell you what you should be doing. So in order for Bitcoin to stay decentralized,
you have to, as I said, don't trust, verify, run your own node, hold your own keys.
Don't improperly do too many things for other people, right? Try to onboard as many other people
to being sovereign Bitcoiners as possible. You know, like Uncle Jimming is great, but, you know,
don't become JP Morgan. Be the small community, Uncle Jim. Don't do everything for everyone.
Make sure that other people are onboarding themselves. Other people are becoming sovereign.
Other people are becoming agentic. We have to get Bitcoin being used in commerce by merchants.
One of the things that really affects the outcome of consensus changes, consensus battles like Bit.1.10, is merchant adoption. Which side are merchants falling on? Do merchants believe in decentralization and integrity and in Bitcoin being money? Or are merchants kind of don't care and they might as well accept Ethereum or Solana in addition to Bitcoin?
You know, are they doing, you know, we need, what keeps the miners in line is merchants,
right?
Like that's the counterweight to the miners in the consensus process.
If a bunch of node runners who aren't doing any payments say, we don't like what the miners
are doing, the miners can just ignore that.
But if a bunch of nodes being used for commerce are going to be rejecting blocks, then the
miners have to, they have to think about that, right?
They have to think twice about mining blocks that are going to be rejected.
Because a block is like $300,000 to mine.
That's a lot of money.
If you mine a block and it gets rejected, you just lost a lot of money.
So what I would say is, yeah, teach people how to be devs.
Teach people how to be merchants.
If you don't know how to be a merchant, become a merchant.
If you don't know how to, I mean, so I would say hold your own keys.
Learn how to use Lightning.
learn how to onboard somebody to self-custody, learn how to be a merchant, learn how to be a
developer. Generally, people take one of those two paths. They either become a merchant or they
become a developer. I'm trying to kind of create, I'm working on a project called Ambrosia, which I
hope to sort of combine those, right? Like I want devs to be merchants because the biggest problem
with Bitcoin Core is they don't understand why the merchant experience is bad because they're
and not merchants.
Devs tend to just kind of look for a job.
They tend to look for somebody else to give them
a high-paying salary.
And then they can sit back and have a cushy existence,
and they don't understand the people that are actually
trying to use their software.
I want developers to use their own dog food.
So we have to get this loop between devs and merchants going.
And we have to get this loop between Bitcoiners and merchants.
If nothing else, get merchants in your local economy
accepting Bitcoin, at least using a custodial wallet, but pressure them to get into something
self-custodial. Phoenix wallet works really well for that. Yeah, just learn as much as you can,
help other people learn as much as they can, and use Bitcoin as money.
I love it, man. I think that's sage advice. Honestly, that's what we do. All we do is train
people on self-custody, self-sovereignty, protecting your data, plan B residencies,
how to run a node. That's all we do all day long. And I couldn't agree more with that
sentiment. So let's round this out with our final question. You promised me you had some
unpopular opinions. So what's an unpopular opinion you have? And you get bonus points
if you offend some Bitcoiners with it. Besides everything you just said.
Yeah, I know. I think I've already mentioned them, right? I think
My two biggest unpopular opinions are that most Bitcoiners are actually sovereignty minimalists,
not sovereignty maximalists. So they're the sort of the more communist version of a libertarian,
which is, you know, basically I want to have as much freedom as possible, but I don't want to
take any responsibility. So I know this is going to trigger a lot of people. There's a lot of
Bitcoin core devs that fall in that camp. Actually, almost all of them basically are just like,
we don't, what taking responsibility, what's that? We don't want to have to do that. We just want to
tinker and not have to worry about anything. That's number one. And number two is, I think,
you know, a lot of like Wall Street Bitcoiners would be offended by this, but Bitcoin is not
just a store of value. Bitcoin is a store of value and a medium of exchange. If it's just a store of
value, it becomes gold. And as we know, gold was captured and is literally where the fiat standard
came from.
The fiat standard came from gold being captured.
So if we want to avoid that, we need
Bitcoin to work as a medium of exchange.
We need Bitcoin to work in commerce.
Obviously, store of value is more important.
This is why in the block size wars,
we emphasized Bitcoin being stable and conservative.
But Bitcoin also needs to scale organically.
And oh, here's another one that'll probably
fend a lot of people.
Liquid and Citria and layer twos that don't have unilateral exit.
So Lightning and Arc have unilateral exit.
Do you know what unilateral exit is?
I can imagine what it would mean.
You can get in and out and you can decide.
Like you have optionality when you're there.
You don't need to ask permission to exit the layer two.
Yeah.
So this is what Lightning does.
If you have a Lightning channel, you have a transaction that's pre-signed
that you can post at any moment, and it will close the channel
and withdraw all your money.
So that's why Lightning has unilateral exit.
Arc has a similar thing, although they're kind of struggling with that.
They have some workarounds that are not great.
But we're working towards unilateral exit on all the layer twos.
But Liquid and Citria and BitVM and all these,
there are apparently ways to make BitVM have unilateral exit
with like ZK proofs and stuff.
But I'm skeptical.
I'm not ready for shit.
So my unpopular opinion is that a bunch of things that people say are layer twos are
not actual layer twos.
They're just, they're applications, right?
They're just things that use Bitcoin.
Okay.
You're not really a lot better than Coinbase, right?
Like you just, you put your layer two, you put your, you put your Bitcoin into layer
two, you trust somebody, and then hopefully you can get your money out.
That's not layer two.
That's an app.
That's a good, that's a good warning to give.
because I use Lightning often for payments, haven't played around with many of the others.
So that's something I need to be aware of. And I think many people do. Well, I'll be honest with
you I think those are good unpopular opinions because there are lots of people who will be offended No offense taken here man I think we on the same page with this stuff So I appreciate that Chris first of all thank you so much for your time man This has been a blast I learned a ton Why don you tell people where they can find you follow you anything
else you want to point them to? Yep. Yeah. Thanks. Same. Right back at you, Michael. Thanks for
having me on. It's a fun conversation. I'm Chris Guida. I'm cguida6 on Twitter. My projects right
now are just working on building a local economy and building a project called Ambrosia, which,
as I said, is a point of sale system to try and get as many merchants onboarded to self-custodial
Lightning as possible. And yeah, you'll see me around speaking at conferences and
doing a podcast circuit and all that. So yeah.
Love it, man. Thank you so much for your time. Cheers, brother.
Cheers, man.
And that's a wrap again. Hope you enjoyed my conversation with Chris. I know I had a blast.
One of my favorite conversations I've had on the podcast, honestly, just very insightful,
knowledgeable guy.
Glad he spent some time with me.
If you need help, as we discussed, taking your Bitcoin into proper 100% self-custody,
go to thebitcoinway.com slash podcast.
We can teach you to run a node, schedule a free 30-minute call with our team where we
can walk you through our philosophy.
We can show you what an onboarding option looks like for you.
And we also help with online privacy, setting up privacy phones.
We've got a Plan B residency in tropical Panama as well.
if you're looking to get out of one of these tyrannical jurisdictions that we're seeing pop
up all over the world. Again, it's thebitcoinway.com slash podcast. Until next time, stay safe,
stay sovereign, and remember the yield on Bitcoin is freedom.