Latest / TFTC: A Bitcoin Podcast / #714: What Comes After Taproot? with Arbedout

Transcript

#714: What Comes After Taproot? with Arbedout · TFTC: A Bitcoin Podcast

• 0:00
  sup reeks yeah nine years after the first four years since our last uh 614 15 episodes uh add
• 0:08
  100 to it this will be uh you'll be 7 13 or 14 depending on when we put this out good to see you
• 0:14
  again marty it's good to see you too we have a lot to catch up on all right let's just jump in
• 0:18
  uh all right so uh there's this guy jeffrey epstein he's uh got a lot of people caught
• 0:22
  up in some stuff there's some emails out there jeff epstein the bitcoin maxi yeah yeah that guy
• 0:27
  uh i am astounded at how many people are showing up in those files yeah it's crazy to me it i think
• 0:38
  it's not surprising that the guy who owned the biggest house in new york city who had hundreds
• 0:44
  of millions of dollars was interested in a speculative financial opportunity in 2014 2017
• 0:49
  that's not particularly surprising to me i think the fud that he had anything more to
• 0:56
  do with it than that that it was being used for who knows what i don't think there's any evidence
• 1:02
  for that but that's not the most damn thing the most damn thing is how many people were
• 1:06
  communicating with this guy well after it was known he was a creep convicted creep convicted
• 1:13
  creep uh openly not even by the end to you signal or saying let's take this to a phone call or
• 1:18
  anything just gmailing back and forth casually about can we meet up can we talk about this
• 1:22
  opportunity it's crazy to me how many people were comfortable with that yeah and like just reading
• 1:29
  through some of the emails haven't done a deep dive on all three million emails but the ones
• 1:32
  that i've seen floating up on twitter it does seem like uh i want to suck off the teat even though i
• 1:37
  don't think there's anything particularly damning or criminal but a tremendous amount of poor
• 1:41
  judgment on a lot of people's parts yeah lack of moral character yeah that's uh you know there's
• 1:47
  always been what was this saying i think we mentioned this in 2017 when we did the first
• 1:51
  episode it's the way the smartest of people in the dumbest of money meet yeah yeah well wow talk
• 1:57
  about the dumbest of money i mean he had hundreds of millions of dollars at his disposal but also a
• 2:02
  twice convicted sex offender most notorious in the world there are certainly other places you could go
• 2:07
  if you need an extra buck yeah i'm not quite sure why people felt the need to continue a relationship
• 2:13
  with him there are plenty of examples in the files of people rejecting his company
• 2:16
  I wish more of the people that showed up that were in the Bitcoin adjacent ecosystem would have done the same.
• 2:23
  Agreed.
• 2:24
  No, it is, I'm just talking to people behind the scenes.
• 2:28
  It is spooking people like, oh, it's just going to be an existential narrative crisis for Bitcoin.
• 2:35
  You know, if you hint and wink and nudge at it, you can say this person and this person and this person.
• 2:40
  Play six degrees and say, oh, you can point to Jeff Epstein and eventually get to someone you might have met.
• 2:45
  Get to me.
• 2:45
  Yeah, right.
• 2:46
  get to you yeah but to what end okay so this person sent this person an email and then that
• 2:52
  person did what it looks like a lot of it was sent some money for a speculative investment okay yeah
• 2:58
  and what happened i think the uh the media labs thing is the the most most interesting because i
• 3:05
  think there's a lot of bitcoiners that have come into the space uh more recently and weren't around
• 3:13
  back in that era when uh joy ito in the media lab uh the mit media lab really began sort of backing
• 3:21
  core developers and gavin anderson people have been talking about i think there's a lot of
• 3:26
  misunderstood context by newer bitcoiners where if you were around back in the day
• 3:31
  mit media lab like in the beginning people were like oh this is pretty cool but then they started
• 3:35
  doing weird stuff and i think gavin anderson obviously 2015 when he started pushing what was
• 3:42
  a bitcoin classic bitcoin ultimate bitcoin xt right it's hard to keep track of all the fours
• 3:47
  and then um i don't even like joy ito and like what was it nira what was her name um
• 3:54
  name just gave me but i remember yeah they started putting out like proposals that i remember being
• 3:59
  like that i don't like this and publicly being like this is not the way bitcoin should go well
• 4:04
  you know instead of dismissing let's look at it adversarially and there's two ways you can go right
• 4:08
  the adversarial way is okay so there's this shady i'm just sex offender that's the easy
• 4:13
  that's the scivia stuff he's also obviously involved with intelligence agencies and all sorts
• 4:18
  of oligarchies and autocracies and bad actors all around and he's throwing money at uh early stage
• 4:25
  bitcoin developers to some nefarious end he wants to get some proposal implemented in bitcoin for
• 4:31
  reasons unknown it doesn't look like any of the things that were proposed were particularly
• 4:39
  successful uh if i think of can you name some uh media lab we were talking about downstairs like
• 4:47
  again if we're kimono open we're gonna think of something as like tad try to he was at media lab
• 4:52
  for he was funded by the street log contracts and then there's the beginning of the lightning network
• 4:56
  yeah uh so if you really wanted to be tinfoil had you could say jeff epstein wanted payment
• 5:02
  channels for some reason enlightening was just an iteration on a payment channel idea that had
• 5:08
  been around for a while yeah to what end again yeah um well let's keep going with that adversarial
• 5:14
  thought maybe he wanted maybe he's the man who wanted to make sure that bitcoin was wired as
• 5:18
  a settlement network and it would become digital gold and not actually bitcoin cash he's thwarted
• 5:23
  satoshi's true vision that seems wildly unlikely there are so many different things that have to
• 5:27
  line up to make that true it's much more the it's fun to play conspiracy theorist conspiracy fact is
• 5:34
  much creepier which is this guy had a ton of money and was putting it every which way and there were
• 5:39
  plenty of people who should have said no who were well within their rights to say no but didn't feel
• 5:43
  like saying no because money is fun joy certainly certainly should have known better there's no mit
• 5:50
  is procedures university there was no shortage of potential funding oh that's where we get into
• 5:54
  like conspiratorial nature yeah so why lay down with this guy i incredibly poor judgment yeah
• 6:02
  no it is um it has been a crazy week yeah this coming out you get the price dumping
• 6:09
  uh it's just a weird time do you think the price is jumping related to the news or is it shocked
• 6:14
  i think there's more i've actually been trying to do more research on the october 10th last year
• 6:20
  the whole binance thing yeah binance thing like i've been talking to some people that are
• 6:26
  well within the know like the market makers that were affected by that and they're like these people
• 6:29
  don't feel comfortable coming back to like make markets and a liquidity profile for big i could be
• 6:34
  wrong but that's much more interesting to me not that i mean we can talk about the epstein stuff
• 6:38
  all day if you want yeah but that's much more interesting to me uh if you see one thing that
• 6:42
  a friend of mine pointed out to me is that bitcoin has been dropping steadily on the weekends uh
• 6:50
  which is something we've seen in the past when a major market maker in exchange blows up and
• 6:56
  they're unable to cover it during the normal intraday trading sessions and that's obviously
• 7:00
  conspiracy there might be a million reasons why bitcoin is dropping over the reasons that was his
• 7:05
  theory uh i'd sort of pushed back on that but the idea that they're instead of somebody blowing up
• 7:11
  that there were market makers and liquidity providers who were just spooked by what happened
• 7:15
  on 10 10 and now the price just bottomed out from none of them and they're staying on the sidelines
• 7:21
  yeah that's worth investigating i think that i think there are external factors just broader
• 7:26
  liquidity in the in the uh economy if you look at um what's happening uh at the stock market i think
• 7:36
  there are many people looking at what's happening in ai and being like all right there's 400 billion
• 7:40
  dollars of capital that's been outlaid into these hyperscalers specifically working on the models
• 7:45
  and they're only bringing in 20 billion dollars of revenue or something like that and so they're
• 7:50
  positioning for a crash and everyone's slowly taking their chips off the table that's another
• 7:54
  good one yeah uh let's see what else is there there's potential changes to the federal reserve
• 8:02
  hawkish fed chair coming in what could that mean likes bitcoin but he's hawkish bad for bitcoin
• 8:07
  quantum fud or not fud that's it's it's almost gonna say fud and not fud quantum joke there
• 8:16
  i took you a second took me a second but now i got it yeah no there's a there's a ton of like
• 8:23
  i think 13 years in that's the one thing i've learned is like who the fuck knows exactly why
• 8:28
  more buyers than sellers right that's the line yeah and uh but i certainly do think there's more
• 8:36
  more doubt around bitcoin that i've seen in quite some time um maybe since 2022 but even 2022 there
• 8:45
  was this you could point at sam bank from freed and be like oh it was definitely him like everybody's
• 8:50
  a bad actor and you could slowly rebuild that um that's sort of reputational trust with bitcoin
• 8:56
  specifically but right now like as we're discussing it's like what is the exact cause there's no ftx
• 9:00
  to point at maybe you can put it binance on october 10th but it doesn't seem like many people are
• 9:04
  doing that i think people are getting spooked one thing that we didn't mention was at the
• 9:10
  when donald trump was first elected there was all the talk of the strategic bitcoin reserve day one
• 9:16
  that was literally what we were talking about and now it's what a year and change into this
• 9:22
  administration and there's nothing on the horizon maybe it's that narrative dying out and the idea
• 9:26
  that the government is going to be there to buy your bags so well it's even worse than that uh
• 9:31
  because we do have the executive order strategic reserve where it's anything we've seen we get the
• 9:34
  keep and then you had the guy who's supposed to be looking over uh the seized bitcoin fund his son
• 9:39
  just took the keys and ran is that so hang on is that the guy who's supposed to watch over or is
• 9:45
  that treasury versus doj is there i think they hired a third party custodian i don't know i
• 9:51
  didn't dive deep into this story i mean i've seen the headlines and i think the last thing i saw a
• 9:56
  few days ago is like the kid took 40 million dollars of seized how hard is it to set up a
• 10:00
  multi-sig come on guys this is a humiliation ritual I mean it's why we're still so early this
• 10:05
  is why yeah this is okay we're gonna go bullish now we're so early don't even know how to secure
• 10:10
  Bitcoin properly at the government level which should not be shocking the government can't really
• 10:13
  do much competently so um yeah all of this is to say weird times in Bitcoin weird how would you
• 10:21
  compare this environment right now to you know it was definitely strange back when we did the first
• 10:29
  one 2016 2017 because there was the whole ICO phenomenon and some the first ICO was a one-off
• 10:35
  right you just say well that's weird that's a bizarre thing that happened and then the next
• 10:39
  one comes and then suddenly was file coin raised 250 million for a colored coin Tezos yeah yeah
• 10:45
  around that time too and then we're off to the races and you watch everyone sort of lose their
• 10:52
  lines collectively, and then they all come back to their senses all one by one.
• 11:01
  It was bizarre then watching that initial realization that, okay, whatever this is,
• 11:06
  this isn't going away.
• 11:07
  This is this new era that we've entered where people will talk about tokens and they might
• 11:12
  not accrue in value.
• 11:14
  They might not be worth anything, but they're not a thing that's being outlawed or forgotten.
• 11:17
  They exist.
• 11:20
  I remember the insane feeling of watching everyone around me suddenly gain interest in this stuff and then lose interest in it.
• 11:27
  And having to sort of pretend like, wait a minute, 12, 18 months ago, you were shilling me on the idea of a currency specifically for dentists, all their own.
• 11:37
  Yeah.
• 11:39
  Yes.
• 11:40
  Dentists need to have their own particular currency.
• 11:42
  The dollars just are not good enough.
• 11:44
  You need debt to coin.
• 11:45
  And then a year later, the same person will just have pretended to have forgotten.
• 11:50
  having had that conversation that was bizarre for me now we're in this new world where okay great
• 11:54
  we're i guess we're doing i don't know what's the thing that comes after nfts is there anything after
• 12:00
  bitcoin uh i mean uh meme coins meme coins right uh pumped off on but that's even died out yeah
• 12:06
  you know let's actually we should talk about this the thing that was big over the last year that uh
• 12:13
  caught on like wildfire and then abruptly ran out of gas was bitcoin treasury companies
• 12:16
  is yeah is it out of gas yet or are we just hey we're just i i mean we're definitely past the
• 12:23
  peak that's for sure i think there's a collective understanding that if whatever we're whatever you
• 12:27
  and i are about to do when we step out of here after the rip we are definitely not going to
• 12:30
  launch our own bitcoin treasury company no well that's the that's the um that's the most frustrating
• 12:37
  part about this treasury company meme is they they took bitcoin treasury as a meme away from
• 12:43
  I don't want to say the people that wanted to do it correctly, but like two years ago,
• 12:48
  I don't think MicroStrategy even got the sort of label Bitcoin treasury strategy company until
• 12:54
  like two or three years ago. But our thesis at 1031 is that every company is going to be a Bitcoin
• 12:59
  treasury company. They're just going to have positive cash flows. They're going to sweep
• 13:03
  flows into Bitcoin on their balance sheet. They're going to be a productive member of the economy,
• 13:07
  part of the economy and a bitcoin treasury in my mind when i was running at tftc what we try to run
• 13:14
  at 1031 was okay let's go out run a profitable business and save the fruits of that labor in
• 13:20
  bitcoin that was the concept of bitcoin treasury company it's just been completely ripped away from
• 13:24
  that sensible um sort of approach to it and the companies that were doing that are reaping the
• 13:29
  benefits and quite happy about it and ship posting with their heart consent there's a steak and shake
• 13:33
  uh my favorite is bull bitcoin francis can right talk better than anybody and i think he's got
• 13:39
  the strongest legs to stand on in this regard because i completely bootstrap that company and
• 13:45
  they pay all their employees in bitcoin they run on a bitcoin standard bull bitcoin yeah yeah uh
• 13:51
  i think there's absolutely that's a great strategy just buy and hold bitcoin and hang on to it it's
• 13:55
  the whole trying to when a lot of these bitcoin tradition companies tried to pretend that they
• 13:59
  that they were MicroStrategy 2.0 without realizing the MicroStrategy had a few decades
• 14:03
  of cash flow and a viable business that they were sitting on top of.
• 14:07
  You can't just issue paper and then hope it'll all work out.
• 14:10
  You have to have more than that.
• 14:11
  There actually is financial engineering there.
• 14:13
  I'm not a holder of MicroStrategy.
• 14:15
  I'm not involved with them in any way, but I can understand the logic of what they're
• 14:18
  doing.
• 14:19
  Just trying to take that meme and be a Seller 2.0, it's probably a winner takes most situation.
• 14:26
  lost count of how many bitcoin bitcoin treasury companies that were at the end they were trying
• 14:30
  to replicate the whole micro strategy lightning in a bottle and just what have they gotten what
• 14:36
  do they have to show for it at this point everyone's underwater how do you think this
• 14:39
  winds down uh what happens to all this bitcoin locked in these uh treasuries good question
• 14:48
  we see a wave of m a is it just they're forced to sell yeah probably financial engineering there
• 14:53
  be it depends on the lockup terms and what's encumbered some things will die slowly some
• 14:59
  things will die quickly some things might survive until the next bull market and then they just blow
• 15:02
  up in price that's sort of i mean isn't that what happened with coins there are a lot of them that
• 15:07
  should have died but you just hang on and if you're listed on coinbase you wait till the next cycle
• 15:11
  and then enough liquidity comes in that your value is pumped up again you get to live in another day
• 15:17
  yeah i've i've been sidelines for the last year and it feels uh it feels like i'm missing something
• 15:21
  zcash pumping dude it's back oh god did you ever catch that meme on uh on x the last six months uh
• 15:30
  on zcash all the zcash i watched the whole meta that was very coordinated to me it was old
• 15:37
  yeah but you say like ah this is like i think matt tweeted or excuse me our intern tweeted from 1031
• 15:44
  account uh zcash is a shit coin all the replies were like you're zied lined like of course you're
• 15:49
  you're going to say that so how how long between that tweet and when it started dumping probably
• 15:55
  like six weeks if that it's all the timing yeah yeah you know matt's good at that your intern
• 16:01
  yes yeah yeah the intern yes his name's also matt matt showedell yeah shit we've been talking
• 16:10
  i'm cussing i gotta watch my language can we edit that on or no we don't edit things here i there's
• 16:15
  a three-hour rip of me being inebriated during covid that proves to me that we don't edit things
• 16:19
  in defense of matt odell i mean he was snoring yeah and edit that out yeah god i'll never forget
• 16:27
  that uh what we haven't talked about is how gold and silver trading like ship coins that is crazy
• 16:34
  to me that's another like that's i mean not that i have a uh a storied career in financial markets i'm
• 16:44
  still in my mid-30s so i don't have like a 20-year career to look back on but i was alive
• 16:48
  door of the dot-com bubble vaguely remember it um this is like i've never seen anything like this
• 16:55
  yeah like precious metals should not be giving you memories of the dot-com crash you you know enough
• 17:01
  this is insane what's happening now the only thing that can explain it is something else breaking in
• 17:06
  the financial system and that's why i wonder um if that's what's going on now like is there a
• 17:12
  liquidity crisis people are just falling back to gold makes a lot of sense silver i mean i guess you
• 17:17
  you can try to justify that there's so much industrial use and obviously this expansion
• 17:23
  of the energy infrastructure and compute is going to drive industrial demand for silver and supply
• 17:28
  is not as big but to that degree i mean i sure there's an industrial use but it shouldn't be
• 17:33
  you shouldn't be seeing these insane monetary premiums attached to it right yeah well maybe
• 17:38
  the i mean maybe the gold and silver bugs have been right they've been suppressed by uh paper
• 17:42
  markets for so long and it was and something was bound to break a beach ball underwater as they
• 17:47
  say something broke somebody's getting squeezed possibly there's that around to what like 120
• 17:54
  i think i checked this morning it was like 175 so down 40 in like three days can't talk bitcoin
• 18:02
  was down like 10 today but it has a point being wild time in markets unlike anything i've ever
• 18:09
  seen in my relatively short short career but that's not what i like to talk that's not what
• 18:16
  like to talk with you about what would you like to talk about so far we've covered epstein and his
• 18:20
  weirdness we've talked about the bitcoin treasury stuff all right jump in what do you want to talk
• 18:24
  about i mean uh let's start with i mean i love to talk bitcoin protocol with you all right sure
• 18:31
  what do you want to talk uh obviously we're gonna get the sig bash uh which you're working on but
• 18:37
  before we get there i think last two years specifically uh bitcoin protocol development
• 18:46
  it's i think post taproot people are looking back and the originals wave came inscriptions came
• 18:54
  uh the people sort of close to protocol development and um close enough to understand
• 19:02
  the ramifications of protocol development look at segwit taproot ordinals inscriptions and they
• 19:07
  say uh a lot of unintended consequences with some of the things that that we sort of saw forked into
• 19:15
  bitcoin and enabled and i think i'll just speak for myself i know somebody was a cheerleader of
• 19:23
  seguit cheerleader taproot could not foresee uh the ramifications of the combination of those two
• 19:30
  things and watch the ordinals inscriptions thing um come to market and i'm not even taking a
• 19:38
  a stance on whether they're good or bad i would prefer them not to happen or i would prefer bitcoin
• 19:43
  be used for monetary asset only but i do recognize we did things and they're enabled and you can't
• 19:51
  stop people from accessing a permissionless uh protocol to do those things um and i think the
• 19:59
  the last two years around protocol development there's been a bit of like a uneasy is it i don't
• 20:05
  want to say it's aimless but it's it's very much like what like how do we actually do this moving
• 20:10
  forward so i can see why it feels that way but let's and i'm not going to talk you back from that
• 20:15
  view but i think it's important to remember that protocol development is not what the one thing
• 20:20
  that everyone seems to love to focus on which is what's the next software going to be we have we
• 20:24
  have this sort of built-in instinct to ask ourselves what's next how do we where do we go
• 20:29
  from here what's the next thing to turn on what's the next knob that we can turn there's been plenty
• 20:33
  of work on the bitcoin protocol in the past two years it's just not manifesting in software
• 20:39
  proposals that gather steam there have been plenty of software pros even friendly bips that have
• 20:43
  proposed modification of the bitcoin protocol but none of them seem to have gathered much traction a lot of them have centered around covenant proposals there are i aware of at least four different proposals
• 20:58
  for specific covenant implementations and then if you want to be more accurate about that more than
• 21:04
  one of those is featured in or more than one software proposal features a different covenant
• 21:10
  proposal so there's op ctv which is the old school covenant even before that there was an
• 21:15
  old school covenant proposal that i'm not remembering for 2016 uh johnson allows but
• 21:21
  we'll put that aside there's op ctv there's object contract verify there's op template hash
• 21:29
  uh let's see that's three or four come on a cat oh okay if you want to talk about cat being a
• 21:36
  covenant yeah that was out of left field the tap your wizards guys actually were pushing for that
• 21:39
  soft work everyone's got their own idea of what a potential covenant soft work might be and because
• 21:47
  there are so many different proposals and none of them can gather consensus because now we've got
• 21:51
  all sorts of different ways to fight about how we implement covenants and what are actually
• 21:55
  covenants good for what are we trying to accomplish covenants what scares us about covenants
• 21:59
  i think there's been a tremendous amount of effort put in there's not much work that's manifested as
• 22:04
  result of that because we can't all get behind one of these proposals and the reason why is not
• 22:10
  necessarily not invented hero syndrome i don't think it's lack of agreement on what we're trying
• 22:15
  to accomplish with covenants we know generally what a covenant is we want to be able to commit to
• 22:21
  a certain transaction structure and be able to say this transaction can only spend coins in this way
• 22:26
  but how we accomplish that and what trade-offs we're making everyone seems to have a different
• 22:29
  opinion and none of us really agrees on what we're trying to accomplish by making these commitments
• 22:35
  do we want to enable new scaling constructions different layer two mechanisms better layer two
• 22:40
  mechanisms let layer two mechanisms that require less coordination or work without with less user
• 22:46
  feedback do we want to be able to enable vaults constructions that allow us to claw back funds
• 22:52
  in the event that a malicious actor tries to spend a transaction without her permission do we want
• 22:57
  both is there some secret third thing that we're trying to accomplish with covenants or do we just
• 23:01
  want to have the next software to be able to say we did the next soft work that's where i think
• 23:05
  we're stuck right now if we don't understand where we're trying to go it's useless to argue about
• 23:11
  which car we're going to try to take to get there yeah would you consider a vault covenant
• 23:16
  proposal or a vaulting proposal a vault is a type of covenant proposal yeah it's the covenant
• 23:22
  broadly speaking is any method for restricting the outputs of a transaction so op vault definitely
• 23:29
  meets that bar it's a restricted form of covenant and i think even the author james oberon has said
• 23:35
  that you can implement op vault using op ctv and if he had the preference between the two he would
• 23:41
  he would prefer to have op ctv activated um so let's see that's op vault op ctv cat
• 23:51
  object contract verify op template hash optx hash that was yeah so we're at six covenant proposals
• 23:58
  and all of them are excellent proposals they're well written they're well thought out the people
• 24:02
  who have come up with them have thought about the trade-offs we can't seem to agree this is
• 24:07
  what the process of coming consensus looks like i think when you see six proposals the only other
• 24:12
  proposal i'm aware of for the next soft fork is uh bif360 which is still being developed but the
• 24:18
  post-quantum quantum yeah so that's the one that makes it like tap leaf
• 24:23
  quantum resistant address i think it's still in progress it was just
• 24:26
  rewritten a couple weeks ago but yeah that's the general idea yeah well
• 24:33
  before we even get into the conversation around the six different covenant proposals and how you
• 24:39
  choose one i think this is something going back to what i was saying earlier and to your point i
• 24:43
  think you um really narrowed down what i was trying to say which is like soft fork fatigue and
• 24:48
  ptsd from like okay we just did two major soft forks segway was a massive overhaul tapper was
• 24:54
  a massive overhaul i think that's another problem that should be entered in the conversation i think
• 24:59
  people equate the any future soft fork um they equate the magnitude of a future soft fork with
• 25:06
  segway and taproot which isn't going to be the case and i don't i think segway was more of like
• 25:10
  an engine segway and tapper together like an engine restructure in a way where the soft forks
• 25:16
  mentioned are lighter touch from what i understand hopefully but i suspect that any software that
• 25:23
  implements new opcode is going to mean a new segwit version or taproot version it's going to mean a
• 25:30
  new address type for it might not be from the point of view of someone who's actually merging
• 25:36
  the code into bitcoin core it might not be as heavy lift as segwit or taproot sure but from the
• 25:40
  point of view of wallet integrators and exchanges it might be the same roughly the same amount of
• 25:44
  work for them would you just go to the next beck32 version for sure but let's say if you've if you
• 25:49
  haven't built your software stack to make that just a a trivial operation and it's coding a whole new
• 25:55
  address uh whatever from scratch that might be pretty difficult some there are a lot of software
• 26:01
  stacks that just sort of assume seg would implicitly would be the be all end all that's not the same
• 26:05
  thing to think but you're not planning for the next software you're like i just have to worry
• 26:09
  about this one address type yeah because then you have app layer standardization and just be
• 26:12
  interoperable with each other where you get a big ux hurdle but again going back to
• 26:19
  what i was saying earlier i think the big question in my mind and looking at all these and um on
• 26:25
  just looking at them and talking to the developers been working on the these covenant proposals for
• 26:31
  years it's like yeah it sounds like it would be a nice to have but i always had that lingering
• 26:36
  thought in the back of my head is like have we tried everything we can do yeah not only at the
• 26:40
  protocol level but combining things that are currently possible at the protocol level with
• 26:45
  second layer solutions as well like have we tested and pushed the limits of scaling with
• 26:52
  everything that's been implemented to date sufficiently enough to warrant a sort of
• 27:01
  a very opinionated uh vision on the next soft work if that makes sense yeah it does and it's
• 27:08
  the thing is to me it feels like every six to 12 months we manage to push things a little farther
• 27:13
  in terms of what we're able to do on layer two systems things like arc where arc was two years
• 27:18
  ago versus last year versus this year with our arcade os and arc script when we look at what
• 27:26
  spark is doing with where state chains were two years ago with i think mercury mercury
• 27:30
  there would have been the state of the art versus now spark state chain what we're able to do there
• 27:34
  it seems like we're still being we're still figuring out new things that we can do at the
• 27:40
  layer two level obviously if you're trusting a layer two operator be it spark as the state
• 27:47
  chain operator or the arc service provider or a bit vm bridge that's a different thing than
• 27:53
  trusting consensus than placing your faith in the bitcoin network to validate and force the
• 27:58
  the rules that your transaction must follow. But for every time we make one of these advances with
• 28:05
  ARK with any of these R-layer 2 systems, it begs the question, well, if we can do this here,
• 28:10
  even though you have this trust assumption, if the trust assumption is middle enough,
• 28:13
  is that enough to accomplish what you were hoping to accomplish? Why did you actually need to change
• 28:18
  consensus? There might be a good reason. We might have good reasons for having to change consensus.
• 28:22
  We might, there might be things that we can't do or are undesirable to put that level of trust on an ARC service provider.
• 28:30
  But we're having collectively a difficult time articulating exactly what those limitations are.
• 28:37
  And to your point, I've always thought, I've always been excited about ARC.
• 28:41
  Happy to have been, I think, with the second protocol guys who have their own ARC implementation.
• 28:47
  I think I was one of the first mainnet ARC transactions.
• 28:50
  Oh, yeah.
• 28:50
  I think I saw you in the video.
• 28:51
  Yeah.
• 28:51
  Yeah.
• 28:52
  And it was like magic.
• 28:54
  It was the ability to basically turn a UTXO into a VTXO
• 28:57
  and instantly send to the other people leveraging their ASP in the same rounds.
• 29:05
  And I've always thought I've had ARK just as a concept,
• 29:09
  and obviously we have competing ARK protocols with ARK and Second.
• 29:13
  But I've always liked the idea of like, okay,
• 29:16
  if these ARK protocols can provide enough utility to the market
• 29:20
  they can reach a certain scale and they reach the upper limits of that scale that could be pushed
• 29:25
  even further with a covenant proposal being implemented like that seems like a good
• 29:30
  justification yeah for implementing uh covenants specifically and i think like i've fallen back on
• 29:38
  like i think that's what needs to happen if you want to get covenants like i i have i love james
• 29:44
  oberton good friend of mine love op vault and his passion for making it so you can create covenant
• 29:52
  structures and which makes it impossible for exchanges to get hacked and it's easy or harder
• 29:57
  for individual bitcoiners to lose their bitcoin but um i feel like that's like i don't want to say
• 30:05
  esoteric but it's like a nebulous uh sort of intent almost intangible reason to do this where
• 30:13
  like i feel like asp if arc protocol if one of the protocols were to re like provide utility you could
• 30:19
  do the extensible expressive smart contracts you have this payments layer that exists and
• 30:27
  reaches a critical mass of people that really love the service and then it hits the top of
• 30:31
  its scaling limits and could be um those scaling limits could be alleviated with a covenant it
• 30:37
  would make more sense to do it that way it's interesting to me you know the first one of these
• 30:42
  that we did you and i episode 100 we were talking about i think we talked through the definition of
• 30:46
  what network effects are they're the director indirect benefits that participants gain by
• 30:51
  joining a network uh i'm gonna drop that now because i think this is touching on network
• 30:57
  effects the reason if you think about it uh vault construction should theoretically be more appealing
• 31:03
  because who wants to lose their bitcoin but the people who would want a vault construction who
• 31:09
  would argue for it who would champion it are the people who are either prone to losing their bitcoin
• 31:13
  or have lost their bitcoin so they're sort of they've already exited the network by uh unwillingly
• 31:19
  so they have sort of less pull in the software the next software conversation it's even though
• 31:25
  nobody i mean there's you're not gonna anyone who says actually i would like to use lose my bitcoin
• 31:29
  everybody would theoretically benefit from a vault in reality there's probably more excitement and
• 31:35
  more mind share around the next scaling solution bring more people onto the network than helping
• 31:40
  people who are prone to falling off the network yeah and that's i mean that's something else we
• 31:45
  were talking about downstairs is this emergence of a clear product market fit for lightning
• 31:51
  specifically as a connector between these disparate but interoperable second layer protocols
• 31:58
  you mentioned spark arc liquid chauley and mints yeah and lightning payment channels as rails between
• 32:05
  all of them yes and again i think we're just beginning to recognize the potential of this
• 32:14
  interoperability that lightning provides all these different networks and and i think the
• 32:19
  sort of scaling potential of the that the interaction of all these protocols is
• 32:27
  relatively unexplored as well it's like what's the argument for exploring that as much as possible how
• 32:33
  do you do it so it's actually nothing that can be done with the soft work i don't think to start it
• 32:39
  has to be the second layer systems have to first grow enough and scale to be worth connecting to
• 32:44
  and then operators have to say okay well you know it makes sense for you and i to be connected because
• 32:50
  we've got a lot of liquidity that's hitting the main chain that we're paying fees for instead
• 32:54
  of doing that i know that most of my sats are going out to you and most of your sats are going
• 32:58
  out to me or your users are going back and forth so why don't we instead of paying the miners just
• 33:03
  just open up a channel with each other.
• 33:06
  That takes a decent amount of critical mass to acquire.
• 33:09
  And all of these systems right now
• 33:11
  are still very much in the experimental stage.
• 33:13
  ARC launched just a few months ago.
• 33:16
  Second, a few months before that.
• 33:18
  Spark, I'm not sure if they're even live on mainnet yet.
• 33:23
  Are they sure?
• 33:24
  Are they?
• 33:26
  I'm not 100% sure.
• 33:27
  I gotta be honest, their trusted operator model
• 33:29
  sort of understood it to me,
• 33:30
  so I'm not as up to date on them as I should be.
• 33:32
  think that i think they're on mainnet now but yeah because they had the the address snafu yeah they
• 33:36
  must be live on main i think the breeze sdk i think yeah i think in breeze sdk you can yeah
• 33:42
  some spark capabilities all right so that's three and then uh let's see we covered arc second spark
• 33:49
  and what are we talking about chami and mints call me liquid liquid the dark horse liquid's been
• 33:56
  sitting there for a decade it's been waiting for a while actually liquid's actually starting to
• 33:59
  pick up steam you know but it takes time for a second layer uh to become palatable to people
• 34:06
  the reason why is well what forces you onto a second layer if the force layer if the first
• 34:10
  layer is too expensive transaction fees are so low that there's no real incentive for people to
• 34:14
  adopt secondary solutions you need something more than just low transaction fees i think that's what
• 34:19
  we found out with the rate of lightning adoption arc in particular offers that opportunity because
• 34:24
  there's these all these new interesting things you can do with arcade script that you can't do on
• 34:27
  mainnet i think i i'm the worst at reading tea leaves in terms of software adoption but i think
• 34:34
  it's a lot more likely that people build cool things on arc that you couldn't build on the
• 34:38
  main chain and then that attracts liquidity and then the liquidity shows up there and then it
• 34:42
  wants to exit to some other secondary solution and then those two l2s have to set up a payment
• 34:48
  channel between them that seems like a likely path forward to me yeah well i will say um even though
• 34:55
  no fees uh on the main chain are disgustingly low shout out mad unfairly cheap shout out
• 35:02
  mad odell mempools will never clear again that was a meme for about a year mempools
• 35:07
  been clear for about uh two years almost now and uh the um i think to push back on like
• 35:15
  the fees on the main chain being the only forcing function up to layer two i think instant settlement
• 35:20
  um with lightning specifically like i see it in the business uh just paying invoices um and
• 35:28
  receiving sats over podcasting 2.0 and zapping people like i absolutely see that being the uk
• 35:34
  is the problem is now you're asking people to adopt a new unit of account so if people weren't
• 35:41
  paying with bitcoin before that's not going to be what pulls them to do it but if you want to pay
• 35:46
  with bitcoin lightning is the way to do it otherwise what are you going to do zero conf
• 35:49
  of course yeah so it's that adoption curve just takes significantly longer than
• 35:57
  than i would like at least uh but you know maybe that's just me being impatient how
• 36:01
  often do you pay lightning invoices uh for probably at least between
• 36:12
  for retail payments i mean probably like between like retail payments
• 36:16
  probably like once or twice a week for like paying contractors and zapping like yeah are
• 36:24
  you zap right or literally zapping is in nostril zaps or nostril zaps like zap like I get that's
• 36:29
  been my um zap right invoices has been one of my sort of low level indicators like Bitcoin adoption
• 36:37
  like if I'm getting more of those in a month-to-month basis like I'm highly confident that Bitcoin
• 36:42
  adoption is increasing and i'm happy to report that that has been happening um obviously i'm
• 36:48
  unique in the sense that a lot of the companies i interact with are bitcoin companies but um it is
• 36:53
  there and the ability to pay in lightning given the choice i will pay in lightning it typically
• 36:58
  works i think we were talking about this as well downstairs but by the way when we keep saying
• 37:02
  downstairs we're shooting at pubkey right now i'm not gonna tell about yeah by the background when
• 37:06
  we were at the bar uh the idea that you were using your is it clodbot or maltbot or is it
• 37:14
  clodbot then it went to maltbot and then two days later it's changed to openclaw so uh in
• 37:21
  out of respect to the project maintainers i will abide by the uh most recent name change of openclaw
• 37:29
  so that's what i'm running but uh i fall back on claw pot because uh it's nostalgic to me i was
• 37:34
  there in the first week before they had to change the name all right then i'll use cloudbot i don't
• 37:38
  want to dead name it um i i think you we actually won't be worrying about these details in the very
• 37:46
  near future whether what how are you going to be paying you'll just tell your llm agent hey
• 37:50
  make sure these stats get there and the llm agent will say okay well i know you need this much
• 37:54
  liquidity and i know you need this sort of settlement and they'll worry about the details
• 37:57
  and it'll be abstracted away from us from the point of view of the ux yeah and so i was telling
• 38:01
  armed out downstairs i've been playing with this for eight nine days now and i set it up to do
• 38:10
  research for me for tftc for 1031 to pull data it's made decks for me it's helped me
• 38:17
  uh find clips in the podcast so like when this podcast goes to our dropbox um it'll trigger
• 38:27
  a transcription to get made so we get the transcription and once the transcripts and
• 38:32
  the txt file is in dropbox somewhere we have claude bot um basically scanning our dropbox
• 38:39
  via a read-only api for txt files it'll find that txt file assume that is a transcript of a podcast
• 38:46
  um 99 out of 100 txt files we put in our dropbox are so it's it's a safe assumption on behalf of
• 38:54
  our claude bot um and then it'll automatically read the transcript and we've sort of trained it
• 39:01
  with enough data of transcripts and twitter performance that'll be able to go in and find
• 39:08
  the time stamps of sections of the episode that are most likely to go viral on twitter and then
• 39:13
  that'll get sent to my producer in a discord chat that's connected to the club bot as well and say hey
• 39:18
  here are what i believe will are the sections of the podcast and if you clip out will go most viral
• 39:23
  so i'm gonna have an llm going through this transcript with you and me figuring out what's
• 39:26
  going to pop on twitter is that what you're telling me i'm highly uh confident it's going
• 39:30
  to be about the first part of the conversation baba buoy baba buoy was that it the uh
• 39:40
  actually we do have an older audience they probably get the reference
• 39:43
  the stern reference so old um oh wait okay one for the kids six seven oh god oh man
• 39:51
  my uh almost six-year-old did that for the first time in the other month i was like no please no
• 39:56
  but that was like we started doing that like i built those processes out first and then
• 40:01
  once those were up and running and it was like working i was like holy that's cool what else
• 40:05
  can this and that's the beauty of um what claude bot open claw whatever we're calling it has brought
• 40:10
  so you have these wider context windows and the harness i guess is what you call it is set up in
• 40:17
  way where it can really uh after compacts context after a large token run it's not just starting from
• 40:24
  scratch we have to upload everything it's able to go back and go into skill files markdown files
• 40:30
  basically say all right here's the context that's been built up over time like i sort of
• 40:34
  know what we're doing in the conversation moving forward and it's been massive for tftc research
• 40:41
  i've got a cron jobbing bank research papers like pulling them in and dissecting those get a summary
• 40:48
  a banking summary once a day of what all the bank research desks are writing about
• 40:53
  but then it got to the point i was like all right can this thing like do bitcoin stuff and i was
• 40:56
  like all right i like i was telling you downstairs i i give it pull only read only access to apis
• 41:03
  um so it has our youtube api as our dropbox api it has a third-party twitter api that we use
• 41:08
  to gather Twitter data.
• 41:11
  And I wanted to check out like a Gentic payments on the web.
• 41:16
  And I was like, I'm not giving you access to debit, credit card information, a Stripe account.
• 41:22
  Let's see if you can spin up a Bitcoin node and accept the Lightning payment.
• 41:26
  So we did some research.
• 41:27
  I was like, all right, this is what I want you to do.
• 41:30
  Like do some research and let have a conversation about what you think is the most efficient way to do this At first actually I put an LDK I was like look at LDK let spin up at LDK now And I was like did it And then like payments were failing And I was like oh yeah duh LDK is not as widely adopted as L or Sea Lightning or Eclair even
• 41:49
  So it's not going to be viable.
• 41:51
  I was like, okay, round zero, you do research.
• 41:53
  Then it came back.
• 41:54
  It's like this Phoenix D server looks cool.
• 41:56
  I was like, okay, let's go with that.
• 41:57
  Spun it up.
• 41:59
  And it's like, okay, I need to get Bitcoin.
• 42:03
  uh you can't send me an on-chain payment but there's this bolt technology where if you could
• 42:08
  send on-chain payment there it was splits and it'll open up a lightning channel um with you via phoenix
• 42:15
  and you'll be able to spend over the lightning network did that and this happened over the
• 42:19
  course of like 10 minutes so just figured out autonomously how to do a submarine swap yes
• 42:25
  did a submarine swap had bitcoin and a lightning channel within 10 minutes
• 42:31
  and i was like okay you've got a phoenix d server that means you can ln url off into um compatible
• 42:36
  website so it's like all right go to ellen markets and see if you can sign in there and it did
• 42:40
  and i was like all right send some sats and make a small trade and it did point being is like what
• 42:46
  you said and it's completely to you wouldn't have any idea if it was if they if your agent and ellen
• 42:54
  markets well it's in the name but if they were to adopt arc you wouldn't know anything about it you
• 42:57
  You wouldn't care.
• 42:58
  They'd be sorting out the liquidity founders themselves.
• 43:00
  It's not for you to worry about.
• 43:02
  No, and it is funny because a bunch of Bitcoiners have been experimenting with this.
• 43:07
  I've seen Bram Cramstein from the Bitcoin Millennials podcast.
• 43:10
  He created this skill, which basically gets your agent access to your Lightning Wallet via Nostra Wallet Connect, which is, I guess, a cool hack.
• 43:21
  But then they have access to that wallet.
• 43:24
  And I found this out after the fact.
• 43:25
  breeze came out with a skill that you can have your uh claw bot download to build a wall via
• 43:33
  breezes development kit but i thought it was just cool like it just did its research found phoenix
• 43:38
  d it worked and it's still working right now man i feel like i've had my head buried in the sand
• 43:46
  for the past few months and i've come up and everyone is we're not quite at agi but you guys
• 43:51
  are on another level i got to spend a week actually digging into the stuff and getting my
• 43:54
  getting an lm to start buying things from you yeah but to your point i think uh many people
• 44:00
  especially if you haven't touched this stuff yet are under appreciating like ux hurdles that this
• 44:05
  is going to dissolve yeah um like really i think the whole form factor of how we interact
• 44:11
  with i guess the internet i don't even know we're going to call it anymore it's just voice to text
• 44:15
  or text to like i was talking to a couple of bitcoiners uh yeah last week and the way they
• 44:21
  they were describing it as like, you're just going to be a projectionist, like anything you want.
• 44:25
  That's a great way to look at it. I think if, if we and I were having this conversation a year,
• 44:28
  two years ago, we'd be talking about QR codes and how you unify on chain versus on off chain
• 44:32
  QR codes. Now it's just let, okay, write a skill for it. Let someone else figure that out. Let
• 44:37
  something else figure that out. Yeah. Do they have souls? I don't think so. But, um, to your point,
• 44:44
  um, no, not to your point, but that's cool. I think that's going to be massive for adoption and
• 44:50
  use user um like ease of use user experience uh but bringing this back to like protocol development
• 44:57
  pushing the limits before we decide on the next soft fork if it ever happens maybe we've ossified
• 45:03
  already part of it i think is well ossification isn't any one person's choice to make but on the
• 45:11
  part of developers all of the drama around softworks in general is a gigantic turnoff
• 45:16
  nobody wants to be the one who's stuck working on the next soft fork just to absorb a tremendous
• 45:21
  amount of discontent of hatred of uh jibes and the slings and arrows of outrageous fortune from
• 45:30
  people online you know why not just work on something else like ephemeral anchors or cluster
• 45:34
  mempool or something there's plenty of interesting things that can be done on bitcoin it's easy to
• 45:40
  forget that we're still 17 years out from some guy doing a weird scientist experiment in vs code
• 45:48
  in windows that just barely worked on his one machine and now we're at a multi-trillion dollar
• 45:53
  economy there's a tremendous amount of work to be done getting this thing actually to the point where
• 45:59
  we're trusting it where we can trust it to the level that we are already trusting it right now
• 46:05
  uh a lot of that stuff doesn't have to be a soft fork a lot of it is more gratifying
• 46:09
  or less stressful or less drama prone it's difficult to justify working on a soft fork
• 46:17
  proposal if you don't know what fruits that software proposal is going to reap
• 46:22
  i think maybe segwit taproot and script you stuff has a small part to do with that but a large part
• 46:28
  is okay if it's covenants for example what are you trying to accomplish with covenants if it's
• 46:34
  the post-quantum stuff is probably the only thing where we can say definitively what's the goal of
• 46:37
  soft proposal well it's to not get hacked by a graphically relevant quantum computer everything
• 46:42
  else is well we want to scale we want to think make things more secure what does scaling actually
• 46:48
  mean what does more secure actually mean for who and i think it's a problem you've been thinking
• 46:53
  about oh wow nice segue what uh what does it mean to you how do we saw oh man uh okay for background
• 47:02
  odell already scooped you on this he he uh ambushed me like nine months ago i think he wanted to talk
• 47:07
  about the book um and what we ended up talking about is the project i was working on called sigbash
• 47:15
  which is a programmatic signer just you know think of it this way there's two ways that bitcoin can
• 47:20
  move right there's proof of work and there's signing transactions proof of work is mining
• 47:25
  obviously and signing transactions is what we normally do it's broadcasting yeah with our wallets
• 47:30
  a programmatic signer is what you would use if you wanted to have someone else in your multi-sig
• 47:39
  that wasn't someone else that instead of a person like uncle jim or a company like coinbase you
• 47:44
  wanted to have just an anonymous service that would give you a signature if something happened
• 47:48
  i thought that was a neat project to work on and i wanted to get my hands dirty with it so
• 47:53
  i spun it up about two years ago and i got it up and running and testing and started banging on it
• 47:59
  with users. The original model I had used something called blinded Xpubs. And the idea
• 48:06
  behind blind Xpubs is the server has the master Xpub. We send you that master Xpub. You derive a
• 48:13
  child key from it that the server doesn't know anything about. And what you get out of that is a
• 48:18
  level of privacy that you don't get out of traditional multisig. Traditional multisig,
• 48:22
  when you share Xpubs with people, they see your entire transaction balance and your transaction
• 48:28
  history just by joining a multi-sig with you which is not great if you're if you want any sort of
• 48:36
  relationship with your multi-sig sign or beyond being best friends it's weird to start it off with
• 48:41
  hey here's everything about me here's everything i own everything i've ever done um i wanted to
• 48:47
  explore if there were if there was more to be done on the privacy layer than that uh and blinded xpubs
• 48:55
  is what i landed on and planting blind xpubs in a web server was interesting to me and so that was
• 49:02
  the first iteration and um just so i have around understanding of this and the audience as well
• 49:10
  with the you get a master key you create a child leave from that is it a situation in which like
• 49:18
  if it's a two or three multi-sig as long as you have the two keys you can sign and the blinded
• 49:25
  signer service will have no idea that you're moving bitcoin if you're using right keys but
• 49:29
  in the case that you lose one key in the backup and you need somebody there to be the second
• 49:33
  in the two is requorum you then bring your um your transaction to the blinded signer and say hey
• 49:40
  i actually need your help i know you have access to yeah that's the idea so break glass and you
• 49:46
  can use the signer which sounds great when we're talking about across the table right now but if
• 49:50
  you think about it for a few minutes and this is what i found talking to users and it took me a while
• 49:54
  to come around to this but it's the sad truth if you have a signer that only gives you privacy
• 49:59
  until you actually ask to use them that's not very useful you know uh the fatal flaw in it is you
• 50:06
  whenever you actually need the signer you have to show them your entire transaction details
• 50:10
  And it might be true that you don't have the same XPUB flaw as traditional ECDSA multi-sig,
• 50:17
  but you still don't have anything that can be called real privacy.
• 50:22
  The problem with that to me is that it's not just sort of that you're misleading the users
• 50:29
  by offering them well.
• 50:30
  You have privacy kind of as long as you don't use it.
• 50:32
  It's also the really interesting thing with assigner would be if you had total privacy
• 50:37
  from them.
• 50:38
  to ask them for any sort of permission besides just give me a signature basically like blind
• 50:44
  signing almost except without the flaws of blind signing if you were somehow able to do that that
• 50:49
  would be way more interesting you'd be in this whole new different realm of what it means to
• 50:54
  use a signer instead of having them as like judge during executioner for your transactions they could
• 50:58
  just be a notary you know someone just give me a stamp and go you're i need you if i've lost my
• 51:04
  keys or my friend isn't able to sign or any one of the million reasons but i don't want you to be
• 51:08
  involved anyway in this transaction and v1 just wasn't able to do that and so you've been iterating
• 51:15
  yeah well you guys were all you know i wish i wish you'd let me know there were coding agents while i
• 51:21
  was working on this it would have been helpful uh so i guess i will announce it now by the time this
• 51:26
  goes on wonder is it gonna air monday it's up to you let's say monday i don't want to do this too
• 51:31
  long once uh v2 of sigbash will be live i built a zero knowledge signer for arbitrary bitcoin
• 51:38
  predicates okay okay that's a lot to say should we explain what that is yeah yeah all right so
• 51:44
  the first thing with the signer was i talked to for v1 i talked to a lot of traders and they had
• 51:48
  all sorts of ideas like oh you should sign if the price of bitcoin is above or below a certain amount
• 51:54
  or the price of this or that is above or below something and that was interesting to me but
• 51:59
  but it sort of forces you to be an Oracle.
• 52:02
  That's what I was going to say is it's like a DLC Oracle,
• 52:04
  it sounds like.
• 52:05
  Yeah, we have the DLCs.
• 52:06
  The Oracle just provides the information hash.
• 52:09
  And on the one hand, that was interesting to me
• 52:10
  because I think one of the reasons DLCs haven't seen much
• 52:13
  adoption is while they're great in theory and practice,
• 52:17
  choosing to use DLCs, every DLC Oracle
• 52:20
  is sort of married to its own wallet.
• 52:21
  There's no standard DLC format.
• 52:23
  So if you want to enter a DLC contract,
• 52:25
  you're disposing into some app that is tied to a DLC.
• 52:29
  there's no like psbt for yeah there's no standard there's no sort of interoperability and beyond
• 52:33
  that there's the whole oracle problem you're trusting someone's idea of like what the price
• 52:37
  should be and you have to make sure they get it right it's a whole i i solved one problem by letting
• 52:43
  the signer do that and just there were five other problems with it um what i learned is that people
• 52:49
  are interested in talking about dlcs in theory and practice what motivates people who engage in those
• 52:55
  trades is liquidity above all else and they will sacrifice everything for liquidity if they have
• 52:59
  to choose between privacy and decentralization versus one extra iot of liquidity they will rush
• 53:04
  to fidelity or charles schwab or coinbase and they will get the liquidity they need which can't
• 53:10
  really blame them for yeah but everything so this would be like a margin top up yeah in their the
• 53:15
  use case with sigbash v1 yeah thinking like hey if the price goes below this level i have an
• 53:21
  understanding my mind exactly to send it to bitmex to meet margin requirements yeah so so i don't have
• 53:26
  to rush to find my wallet and do that i want you to just do it automatically and if you're going to
• 53:31
  do that why wouldn't you just have bitmex implement that scheme themselves why wouldn't you be close
• 53:35
  to the actual person who's executing the trade or the loan top up with a margin call or whoever yeah
• 53:41
  what i found talking through months and months of user reports was the one thing that people
• 53:46
  were interested in was uh the condition for i'll only sign after a certain date and that was
• 53:52
  confusing to me because you can do that with bitcoin now you can do that in mini scripts
• 53:55
  you know we have uh check lock time verify we have uh a rich manuscript language allowing you
• 54:03
  to specify i'll only sign after this date but what it took me a while to understand was that there's
• 54:09
  a difference between and it's obvious in retrospect it's wallet policies versus signing policies while
• 54:14
  policies are when can i spend from this wallet signing policies are when will i provide a
• 54:19
  signature that allows you to spend from this wallet they're they're sort of orthogonal
• 54:25
  and i took that understanding and i flipped around with v2 so v2 has no external conditions it's all
• 54:31
  the psbt is the source of truth so any condition that you can define in a psbt is what you could
• 54:38
  theoretically sign on so throw out a condition to me and i'll describe something um a thousand blocks
• 54:45
  guess oh yeah sure that's easy man i wanted something hard how about can i throw some out
• 54:50
  yeah um only sign to one set of addresses if the amount is over 100 000 sats and it's business
• 55:00
  hours otherwise only assigned to another set of addresses if it's below 100 000 sats but only
• 55:08
  once a week otherwise i can keep going with this i had to build a whole custom data structure to
• 55:13
  handle all this branching so when i say arbitrary predicates just think of as many conditions as
• 55:17
  you can put together and when i say conditions think of all the things you can see in a psbt
• 55:22
  sounds a lot like a covenant it's sort of like a covenant kind of it's what's a covenant
• 55:29
  it's a restriction so cosigners can emulate covenants in general and a zero knowledge cosigner
• 55:35
  can emulate certain forts of comets pretty well there's sort of a tension between okay you're
• 55:39
  trusting the cosigner it's zero knowledge so you're not trusting it to see your transaction
• 55:44
  details but you are trusting to be online to get a signature in exchange for that nobody else gets
• 55:50
  to see your transaction details so it's not enforced on chain which can be good which can
• 55:56
  be bad maybe you don't want to share the details of your transaction on chain maybe you just want
• 55:59
  it to look like a spinner a standard taproot spend and only have the signer involved not the signer
• 56:04
  doesn't mean no because it's zero knowledge but only the other signers involved so i think
• 56:12
  you're getting to uh an important detail having mentioned it three times last minute like zero
• 56:16
  knowledge how does that how does ck proof come into it so okay uh instead of showing a the signer
• 56:23
  a partially signed bitcoin transaction psbt that you want signed you present a zero knowledge proof
• 56:28
  proving that the psbt that you want signed meets the properties of the transaction that you initially
• 56:34
  asked us to sign okay so that zk proof logic lives it's not on bitcoin obviously no it's in
• 56:44
  it's written web assembly it's in the browser so you have like a browser relationship with your
• 56:49
  server yeah it's running these yeah so instead of i because i don't want to ask anyone to even
• 56:53
  download a program and run it so theoretically if i had you download a program that would be
• 56:58
  reading your transaction and sharing the zk proofs in reality it's all happening in your browser
• 57:02
  it's you just upload a psbt and you can you can verify yourself the psbt actually doesn't hit our
• 57:07
  servers which are hits our servers instead is the zk proof generated from the psbt and uh you know me
• 57:14
  uh not as highly technical as many other bitcoiners out there but i assume they don't have to like
• 57:22
  you're going to be okay if you set this up and then six months goes by you've cleared the cash
• 57:27
  of your browser and yeah yeah it's fine it's it's in the p it's in the ck proof that says hey you
• 57:32
  set up this psb or i recognize this psbt from having been set up before so what we store on
• 57:38
  our servers is an encrypted blob that only you can unlock so whenever you log in we'll see your
• 57:43
  we'll send you the encrypted blog blob uh that will have all of your transaction details and
• 57:48
  all the details of the proof that you need to satisfy and everything what we the only other
• 57:52
  thing we store is one hash one opaque hash that i can't tell anything about just a random string of
• 57:56
  numbers it's a the root of a merkle tree what you're submitting to me is a miracle inclusion
• 58:01
  proof and then a zero knowledge proof showing that you are able to provide inputs that satisfy
• 58:07
  that miracle inclusion proof how did you come to this it took about two years of banging my head
• 58:12
  against it uh it is very creative it is it was problem after problem after problem i drew some
• 58:19
  inspiration from uh bit 443 salvatorian gala's merkelize all the things idea uh i took a little
• 58:27
  bit from taproot and a little bit from what lightning did with tarot assets i was sort of
• 58:29
  obsessed with like i knew like a merkle tree in there somewhere would be good there's a paper that
• 58:35
  came out right after i launched v1 about zero knowledge predicates for snore transactions that i
• 58:41
  tried to get working and had to start from scratch because their thing was built like a battleship
• 58:46
  it was they they're using some insane groth 16 zero knowledge proof system that is great for like
• 58:51
  blind coin swaps and it was just they built a battleship i needed a drone and i realized like i
• 58:58
  after reading the paper reading paper i just realized their idea was right but their approach
• 59:02
  was just too much for me and i also needed something that i could understand and debug myself
• 59:07
  um and then i just spent about 18 months just banging banging banging banging and i finally got
• 59:12
  got the last bits of it working unlike everybody else because i had my head down you all were
• 59:16
  working on claude like a sucker i had chat gpt explaining my undergrad cs textbooks to me
• 59:22
  because i thought that was the way you used llms apparently i could have just said hey claude build
• 59:26
  me an awesome signer and that would have been it it's not there yet it's not there yet like
• 59:30
  give it two weeks by the time this airs i trust i trust uh claude code and codex to be able to
• 59:37
  build a flow for me that will take txt files and highlight uh potentially viral youtube clips but
• 59:45
  when it comes to bitcoin security um i'm not sure if i'm i'm comfortable with it there yet so i
• 59:50
  wouldn't uh deride yourself for banging your head and thinking about this from first principles and
• 59:55
  doing it the human way i should have just taken an extra year spending on the beach and then
• 59:59
  the next model will be able to do this we're all being replaced man how does that make you feel
• 1:00:04
  uh relieved if this is the last code that i've ever written then i'll feel good about that i feel
• 1:00:10
  like this is an interesting thing that i built and i hope the coiners enjoy it well it is
• 1:00:15
  incredibly interesting and again going back to what i was saying earlier like when you reached
• 1:00:21
  out to me the other week and i was going through the website and looking at all the use cases i
• 1:00:25
  mean it validated something we're discussing earlier it's like i don't think we've explored
• 1:00:28
  the design space that exists before us and i think what you're doing is just that i think there is a
• 1:00:34
  tremendous amount that we can do with multi-signature constructions in general, as long as we're
• 1:00:41
  honest with ourselves about what the trade-offs are. And I think if the signer in this case is
• 1:00:46
  fully zero knowledge, that trade-off space has been lessened significantly. There's no information
• 1:00:52
  leakage anymore. You don't have to worry about sharing your transaction details with me. You
• 1:00:55
  still have to worry about me being online or not. It's about liveliness. Yeah. So the Bitcoin's big
• 1:01:01
  draw is well as long as there's one honest minor one economically rational minor one person that's
• 1:01:06
  willing to mine my transactions for the appropriate free rate then we have censorship resistance
• 1:01:12
  if i'm only one signer well you have to worry about me being online all right
• 1:01:18
  that's i'm gonna do it because i can see odell on my shoulder right now all right
• 1:01:21
  could you run this in nostril relays you know i could you know what i'll do it just for odell
• 1:01:26
  they asked me nicely but like is that the way you could sort of even narrow that liveliness
• 1:01:31
  exploit down even further you know what theoretically that's possible yeah actually
• 1:01:36
  i don't see why not uh it might take a little bit of re-engineering based on what i have right now
• 1:01:41
  but what i have right now is malleable certainly yeah if odell asked me nicely if he makes me a cup
• 1:01:46
  of coffee from his excellent coffee machine as someone who thinks the world of him got him for
• 1:01:50
  his wedding not dropping any names then i might just do it but i mean again think like combining
• 1:01:56
  these things like i'm that you understand it's much better than i do like i don't know
• 1:02:00
  yeah you know what i when you say malleable you mean like you could port the zk sort of
• 1:02:06
  yeah you could probably well so the nostril would be the transport layer the zk stuff would
• 1:02:10
  you could have a separate binary somewhere that people downloaded and then they would
• 1:02:14
  send the proofs through nostril relays and then eventually they'd get to my end pub yeah you could
• 1:02:18
  You could do that.
• 1:02:19
  And in fact, that's certainly more,
• 1:02:21
  you've solved the censorship position access,
• 1:02:23
  I guess as long as there one odds relay Do we just solve something Are we scaling Bitcoin on this podcast the uh no but it like again like these design spaces have not been explored thoroughly enough
• 1:02:38
  and then yeah and so like the getting into like i know you gave the gimme our ball like you can
• 1:02:43
  only spend a hundred thousand sads storing business hours and staff for business hours less than 100
• 1:02:47
  like so practical use case uh let's run through three archetypes three different user archetypes
• 1:02:54
  yeah what are they in your mind like what are the day-to-day use cases for this so some people are
• 1:02:59
  going to want to do either white listing or blacklisting which i don't necessarily agree
• 1:03:04
  with conceptually but i understand that that's well you know there's some use cases that make
• 1:03:08
  sense and there's some use cases that doesn't the let's you have it on the website dpkr yeah sure um
• 1:03:14
  it was important to me to build something that could be used in ways that i don't approve of
• 1:03:18
  so i don't approve you setting up ovac blacklists with this but you certainly could and i wouldn't
• 1:03:22
  know about it and i wouldn't be able to stop you so you could do that more likely you'll probably
• 1:03:26
  want to do whitelisting and say i actually only want spends to go to my certain approved addresses
• 1:03:31
  uh there's the obvious you could mimic a vault of all construction of some sort you could do all
• 1:03:38
  sorts of treasury management stuff that's the thing that's most interesting to me uh you can
• 1:03:42
  go from beyond two or three multi-sync to really complicated if this key then do that if this key
• 1:03:48
  then do that uh which opens up a whole design space for bitcoin treasury companies oh no wait
• 1:03:54
  a minute did i just dump on them in the first half i'm thinking more um original bitcoin treasury
• 1:03:58
  companies yeah incentivizing early uh early employees who are helping you get to uh revenue
• 1:04:04
  profitability and scaling uh vesting right oh that'd be great you find it more guessing right
• 1:04:11
  like you hey if you help us get to a certain point i'll sign with this key and that'll give you
• 1:04:15
  50 million saps if we don't get to that point i sound with this kid you get 25 million you could
• 1:04:19
  absolutely do that yeah and then something that's near and dear to my heart because i found this out
• 1:04:25
  entirely by surprise when i was working at unchained i was working the booth one day at uh
• 1:04:31
  bitcoin 2021 i think okay yeah and i had the experience of having customer after customer
• 1:04:39
  walk up to us asking about inheritance bitcoiners are very concerned about their if you're hanging
• 1:04:44
  on to your sats and you've been doing so for a while you're concerned about where they're going
• 1:04:48
  after you pass how do you get them to your your errors so building a living trust would be something
• 1:04:54
  you could do with this building a trust or inheritance with more complicated rules than
• 1:04:58
  me my heir and my attorney so how would that work practically like would you have a time lock that
• 1:05:05
  you just assume all right if it runs this long i'm most likely dead and it releases or
• 1:05:09
  or give your well let's see you could have I'll give you an example how about three running time
• 1:05:16
  locks each one allowed to withdraw to a different address one will be
• 1:05:22
  you're still alive you still want control yeah yeah you need two for two and then the three will
• 1:05:27
  be we'll call one of them M one of them B and one of them K they all get them 18 years apart
• 1:05:32
  one five one three and one five months yeah uh or you provide your key so your errors you split
• 1:05:39
  funds three ways based on their 18th birthday okay i like that
• 1:05:45
  but the thing about it is you can literally build arbitrary policies so i don't want to
• 1:05:53
  imagine an ideal use case i want to know what you could do if you could build an arbitrary
• 1:05:58
  signing policy something that you can't express right now in bitcoin script is this um and it
• 1:06:03
  seems like actually you mentioned miniscript either i know miniscript has um sort of this
• 1:06:09
  foot gun uh exposure and that's why they're working on templates um right because if you
• 1:06:15
  just let anybody run wild with a mini script uh you can lock up bitcoin for a million blocks whatever
• 1:06:20
  it may be um accidentally so they're trying to come up with templates that say they have basically
• 1:06:25
  a rough framework of like we know this is outrageous and this is reasonable so we're
• 1:06:29
  going to try and keep you in the the realm of the reasonable where i imagine with sig bash it's much
• 1:06:35
  more controllable environment to an extent so i talked through this with the first round of beta
• 1:06:40
  testers if you hit the site you'll see it there's three different paths you can take the easy path
• 1:06:44
  is and i'm gonna can i plug maple ai yes you can the easy path is you don't actually see a ui builder
• 1:06:49
  or anything any details like that you type into a chat box that goes to maple and says hey here's
• 1:06:56
  the policy i want and it's automatically loaded into our ui builder the next step after that is
• 1:07:01
  click a template they're just like the manuscript foot guns yeah you probably just want to follow
• 1:07:06
  one of these pre-built templates just click it maybe you might have to enter an address but
• 1:07:09
  most of it will be filled out for you the third part is okay here's the policy builder
• 1:07:14
  canvas you can go from scratch go nuts if you know what you're doing i will give you
• 1:07:18
  all the foot guns you want yeah i love that optionality yeah what um and being again talking
• 1:07:25
  about form factor just explaining what you want gonna maple ai voice the text i've got three kids
• 1:07:33
  each one of them turns 18 on this this and that date i want this person to spend a bitcoin build
• 1:07:38
  it for me is that yeah build that logic yeah you could absolutely do that in fact i hope you try
• 1:07:43
  to build that and if there's a bug in it file a bug with me and we'll fix it yeah awesome what um
• 1:07:50
  what's your great hope after announcing this my great hope is that we push ourselves to more and more
• 1:08:01
  find what is possible at the frontier of bitcoin every time i start to feel discouraged that we're
• 1:08:07
  not making progress something comes around like cluster mempool or arc or something where that
• 1:08:14
  makes you think wait a minute this was possible this whole time why was i busy fighting about
• 1:08:19
  dick butts on the blockchain and not actually thinking about this if nobody uses this and it
• 1:08:26
  withers on the vine but it sparks one bitcoin or say hey this gave me an idea that would be my great
• 1:08:31
  hope just pushing things a little bit forward who do you expect the first users to be like do you
• 1:08:37
  think exchanges will uh you know what the first user is going to be the crazy mountain men that's
• 1:08:41
  going to be yeah the people who actually care about privacy i'm talking to a few wallets and
• 1:08:47
  custodians right now for ways to integrate with them and i can definitely see how it would be
• 1:08:52
  useful to them but my guess is because this happened with sigbatch v1 where i literally
• 1:08:59
  released it as a science experiment and before we were off to the races someone had locked up like
• 1:09:03
  the equivalent of it's much more than five thousand dollars now but five thousand dollars in a one of
• 1:09:08
  two with with some buggy logic that for a settlement that i don't think ever came to pass
• 1:09:14
  and i was flattered but also shocked i'm sure it will be one of the the crazy node runners that
• 1:09:19
  does it and whoever it is god bless you i love you and let me buy you a beer afterwards if you
• 1:09:23
  lose your funds will there be an api for this yeah yeah i think you have to build an api that's the
• 1:09:29
  hard lesson i learned from v1 everybody wanted to integrate because you know there's only so
• 1:09:32
  many people that are actually going to be uploading psbt's and interacting with the website that's
• 1:09:36
  sort of to gain mind share there's got to be the wallets and the custodians need nested kate
• 1:09:41
  integrate with thinking now about my my open claw bot yeah your open call but you're not going to use
• 1:09:46
  the sdk you're i realized this last week it's going to be your llm that's going to be integrating
• 1:09:50
  with the sdk yeah yeah how do you feel about the emergence of this uh agentic economy uh you know
• 1:09:57
  it's humbling in the sense that the agent is probably more often doing better work than i am
• 1:10:06
  it's probably you're thinking about this i think your clawbot will lose less sats over time than
• 1:10:10
  i have lost over time from like building foot guns and mistakes that's probably on balance best for
• 1:10:16
  everyone involved well i've been thinking about it in the last couple days since i spun up the
• 1:10:20
  phoenix d well like we need like a vps or bls bls a validated lightning signer yeah for for the
• 1:10:27
  agents where it's like hey i want you to have all the wallet logic but when it comes to signing the
• 1:10:30
  private key like i want something separate yeah from your server running in the cloud
• 1:10:35
  and maybe you communicate with maybe that's overdoing it maybe it's no i think that'd be
• 1:10:39
  great you could have your phone throw you a two-factor off just you know hey your asian wants
• 1:10:44
  to spend some sats okay i approve actually because there's a certain point where you want to be
• 1:10:48
  actually otherwise it's his life cloudbot's next thing at first clawbot buys the tickets for you
• 1:10:54
  then cloudbot goes on the vacation for you then suddenly your wife is taking pictures of the mac
• 1:10:58
  mini yeah well i'm very happy we're having this conversation because that like vls it's like that
• 1:11:02
  is liquid we were talking i mean we glossed over liquid but i think there's a ton of things
• 1:11:07
  that bit corners have been building number one number two not exploring the full design space
• 1:11:14
  uh sufficiently enough in my opinion and then number three timing has been off for a lot of
• 1:11:18
  these things we're like now with the agentic web um sort of emerging in front of us like something
• 1:11:26
  like vls makes a lot more sense now it uh especially if you're like vls up to this point
• 1:11:32
  like there is like a you're running a lightning node in the cloud and it's like yeah that's good
• 1:11:39
  enough like i would like to separate the private key um from the node logic and have physical
• 1:11:45
  access to the private key that's signing but like yeah it's good enough but now with like agents
• 1:11:50
  that can just run wild and sign on your behalf in the server it's like now maybe it actually makes
• 1:11:55
  like maybe that is the impetus we need to to separate the key from the um the node logic yeah
• 1:12:02
  you want to have a program you wouldn't have a reason to have any sort of access from internet
• 1:12:07
  technology machine before now you do have one but you still want a human in the loop right yeah yeah
• 1:12:13
  and then yeah it feels like the timing for a lot of things have been talked about for
• 1:12:20
  quite a while and bitcoin's been derived i think lightning is a great example that been around
• 1:12:24
  since 2018 uh hand up i was one of those people like this is going to be fantasy out of the box
• 1:12:30
  and now it takes like the better part of a decade to actually build yeah and interrupt uh a
• 1:12:35
  distributed interoperable protocol on top of another distributed protocol um i think we've
• 1:12:40
  gotten there and obviously the it's going to solve the payments use case it has to a certain degree
• 1:12:45
  but it's not as widespread as we'd like it to be but now here we are eight years later and it's like
• 1:12:50
  oh like it's beginning to take form and uh i don't think that's a lightning problem i see that as a
• 1:12:55
  bitcoin problem right i mean i don't know just me in the queue like bitcoin is like a bitcoin product
• 1:12:59
  uh it's a function of bitcoin adoption not necessarily lighting adoption right now
• 1:13:05
  weird thoughts on adoption how else yeah bitcoin is for anyone it's not for everyone um
• 1:13:12
  we've said that for a while i am concerned that it might have to be for everyone the way the dollar
• 1:13:17
  is going there you know just forget it just because it's not intended for everyone necessarily
• 1:13:24
  doesn't mean everyone's not going to need it at a certain point if gold is swinging 30 in 24 hours
• 1:13:31
  that starts to de-dollarization stops being a meme and starts being something you're actually
• 1:13:36
  concerned about and if you have exposure to gold it may feel nice to preserve your purchasing power
• 1:13:41
  when you need to go spend it it's not very yeah so i know it's easy to be bearish right now when
• 1:13:46
  we've i don't know what the price is when we walked in but i think we were just about to drop
• 1:13:50
  below the last cycle's all-time high we're pretty close we are at 75 or above where we were above
• 1:13:56
  where we were all right two rips ago when we did this i was dunked on for being a bear so i'm not
• 1:14:01
  making any price predictions but i will say it's easy to be bearish right now there's every reason
• 1:14:06
  to think that who cares about dollar sat parity the number of users is going to go up up up yeah
• 1:14:15
  i agree i think um again the user experience around this is getting better and better than
• 1:14:20
  ever the interoperability i mean you could say that at any moment right as time passes obviously
• 1:14:27
  user experience hurdles are going to be uh overcome but um yeah i don't know i i feel more
• 1:14:34
  funnily enough even at 75k 40 below the all-time high of uh three months four months ago i feel
• 1:14:42
  more confident than ever in bitcoin likewise you know what makes me feel and this is the weirdest
• 1:14:47
  thing to increase confidence but follow the thread if you can you know what gives you the
• 1:14:52
  most confidence watching you use and talk about whisper why do you say that well so there's this
• 1:14:58
  whole idea the biggest problem is getting people to switch their unit of account but why would that
• 1:15:05
  be a problem for you to worry about why don't you just tell your phone buy something and have your
• 1:15:09
  phone talk to the kiosk and decide what the unit of account is and what unit account are they going
• 1:15:13
  to settle on the thing that anyone can print out of thin air or the thing that both of them can
• 1:15:17
  agree has value yeah and even if they want to use two different things like the swappable nature of
• 1:15:22
  bitcoin and retailers is the rails in between is being automated via apis as we speak i mean it
• 1:15:29
  seems like you know brain fart thought leadership nonsense but really think about how many cycles
• 1:15:34
  we've talked we've spent talking about the actual symbol for the unit of account that we should use
• 1:15:38
  for bitcoin yeah your llm doesn't care i'm not happy with you block okay i see what you're doing
• 1:15:43
  the sats i see what you're trying to do you can put the b in front of the sats but it's still
• 1:15:48
  sats at the end of the day jack it's funny too because uh we helped make sats a standard with
• 1:15:56
  cash app back in the day if you don't remember are they doing i haven't it won't render on my
• 1:16:00
  laptop i know everyone's talking about them changing the icon but i don't know what the
• 1:16:03
  b looks like is it let me see let me see i'll put cash up see see what it looks like because
• 1:16:08
  i'm pretty sure if it's what i think it is that's the tie bot um i'll show you it looks like that
• 1:16:17
  okay yeah all right well hmm yeah
• 1:16:23
  it's sat still jack yeah i what um
• 1:16:30
  anything on well before we get your final thoughts on it i want to bring it back to zk
• 1:16:37
  proofs because i think this is something that's been talked about quite a bit just not in bitcoin
• 1:16:44
  but generally like obviously l2's bit vm roll ups everybody's using zero knowledge proofs it's this
• 1:16:50
  incredible sci-fi tech um that we should all be leveraging i agree like zero knowledge proofs is
• 1:16:57
  great but again going back to how do you actually implement it um instead of doing it with like
• 1:17:02
  innovate bit vm or some roll up on ethereum whatever it may be uh i think what you're
• 1:17:10
  building is an example like it doesn't need a blockchain to do this stuff like you can simply
• 1:17:14
  just use yeah the cryptographic logic to solve things and combine things was there a question
• 1:17:21
  in there that was just like in terms of implementation details of zero knowledge
• 1:17:27
  proof specifically like why did you settle on on this like it's not in a roll up it's not yeah well
• 1:17:34
  i was very lucky that i had with v1 a broken product and a broken feature set but a working
• 1:17:41
  user experience the general idea of like well you sign up and i'll give you an xpub and then you'll
• 1:17:46
  use that and you'll ask me to sign a psbt that makes sense so once i had that it was oh well
• 1:17:52
  instead of giving me the psbt rock can you give me a zero knowledge proof that is derived from
• 1:17:57
  the psbt and can i tie it to the psbt and convince myself that that's something that should return
• 1:18:02
  you a signature how do you how long did you test that like what made you comfortable for that
• 1:18:09
  it was
• 1:18:14
  i'm gonna say just shy of 18 months there because even i went the least see even to me
• 1:18:19
  zero knowledge proof so there's a lot of moon math there and i it was very important to me that i
• 1:18:24
  built something that i could understand and debug in the middle of the night so that god forbid if
• 1:18:28
  the worst happened i could say well this is what's going wrong because the thing with ckp is i can't
• 1:18:32
  tell anything about your transaction and asking you to debug it would say well step one i need you
• 1:18:37
  to sacrifice your privacy and share the transaction with me so i wanted to be absolutely sure that that
• 1:18:41
  uh that that didn't come to pass I v1 I actually made the mistake of testing on mainnet and I joked
• 1:18:51
  about like I'm testing on mainnet so I lost a couple hundred dollars in testing not viable
• 1:18:55
  this time it's all signet I wrote a couple of thousand test cases and banged on them banged
• 1:19:00
  on them banged on them I had I was very lucky I had a few alpha testers and a few beta testers
• 1:19:03
  that were rather relentless and provided me with feedback uh I'm gonna say 18 months
• 1:19:10
  What was like the weirdest edge case that you found that you weren't expecting?
• 1:19:14
  You know, the signing part of it, the ZK proof part of it, that was easy.
• 1:19:18
  The edge cases were things where a test would go through and I'd think about it and say,
• 1:19:23
  oh, wait, that leaks privacy.
• 1:19:24
  I just realized something about you.
• 1:19:26
  I can infer something.
• 1:19:27
  The model I tried to adopt was what happens if Chain Analysis or Lazus Group owns my server?
• 1:19:32
  What can they know about you?
• 1:19:33
  And I wanted to say nothing.
• 1:19:34
  It's really hard to get to nothing.
• 1:19:36
  um there were just all sorts of educations were like well okay I haven't seen your transaction
• 1:19:41
  but I can sort of infer your transaction structure if I think about it um
• 1:19:47
  things like well okay I don't know anything about your transaction but I know how long this transaction
• 1:19:54
  took for you to generate a proof and I know how long this simple transaction takes to generate a
• 1:19:59
  proof and if I look at the blockchain I can see well there's this heavy transaction that's settled
• 1:20:03
  must be you things like that okay it's amazing how privates can leak in a dozen different ways
• 1:20:10
  like timing broadcasts yeah all that stuff yeah there was no any one scary thing there were just
• 1:20:17
  a bunch of small little rabbit holes yeah so i'm gonna go back to dlcs that's one thing i remember
• 1:20:21
  testing out dlcs while it like shocked me again uh not the most technical but
• 1:20:28
  pick up things as i go like testing a dlc wall for the first time i was like it's taking a really
• 1:20:32
  long time to sign this yeah so like what you're saying is like on your side somebody brings you
• 1:20:36
  a transaction to sign and you observe like oh this is taking a minute yeah probably a bunch of
• 1:20:44
  other signatures in this transaction so i can go look at mempool.space look for a five seven or
• 1:20:49
  whatever and assume that that could have been the transaction out of your side yeah okay all right
• 1:20:56
  right well something what do you got for the freaks out there
• 1:21:02
  hmm how low are we going how low are we going how bearish are you you know what Odell's not
• 1:21:09
  here I would love it if we somehow managed to what was the high of the last cycle was
• 1:21:14
  a 69 420. did we something around there yeah I would love it if we broke the bottom of the
• 1:21:20
  of the last yeah that would be hilarious to me because I don't think we've ever done that
• 1:21:26
  for but I also think you and I might be recording this at the bottom of the bear market am I either
• 1:21:32
  way I'm screwed with the price prediction here I like I like hey just ride both sides of the
• 1:21:36
  fence like we're either going way lower or at the bottom already yeah I'll I'll be wrong either way
• 1:21:40
  won't I um and I don't want to be flipping about it but does it really matter in a year five years
• 1:21:46
  10 years are you going to look back on the price that's the thing I take from our last
• 1:21:50
  our first one was in 2017 next to 2021 2020 2020 all right yeah we met like around christmas time
• 1:21:59
  2020 god the cursed covid rip do you have any people how any idea how many people in a professional
• 1:22:04
  setting have rolled up to me and said i loved your podcast on tfdc and i say the one hour one
• 1:22:10
  where i sounded like a genius and like no the three hour one where you were drunk and mad
• 1:22:14
  odell dumped on you and took a nap on your rug so we got that yeah now we've got 2021 we did one
• 1:22:24
  year later when i was in austin and my back porch and the thing about all of them is i remember the
• 1:22:30
  bitcoin environment i remember the technology we talked about i remember the topics we touched on
• 1:22:34
  can't remember a thing about the price right same and that's why it stay humble stacks that's like
• 1:22:40
  doesn't like i it's funny because having done this for nine years and seen the waves of adoption via
• 1:22:47
  downloads and increased subscription numbers you could see like anytime the price goes up you get
• 1:22:53
  spikes up and it goes down but the plateau is higher than the last one and i just know there's
• 1:22:57
  a bunch of people who bought like 21 22 23 24 um 25 even and they're like what the
• 1:23:03
  fuck's going on it's like don't worry this is why we say stay humble stacks that's nothing's
• 1:23:07
  is going to change the fact that somebody like ArbedOut can build this blind signer
• 1:23:13
  using ZK proofs to give you more privacy on your Bitcoin without changing the protocol
• 1:23:19
  uh like the what you what you're building is like sci-fi technology that cannot be replicated not
• 1:23:26
  sci-fi but like it's very primitive cryptography not primitive but it's like you can understand the
• 1:23:31
  logic it's simple but it's powerful that's what i'm trying to get at not sci-fi but powerful
• 1:23:36
  sovereign technology and that hasn't changed at all in the seven years i've been talking
• 1:23:42
  it's only gotten better now i'm not just talking about the code i've written but the things
• 1:23:47
  we've managed to build collectively as a community in the past nine years when you started think of
• 1:23:53
  where lightning was think of where you were probably there when lightning lnd first launched
• 1:23:59
  its alpha you were there when nostril realized first went live and we all made the migration
• 1:24:04
  and we started spinning up end pubs yeah i think this podcast was probably the second or third
• 1:24:11
  podcast leveraging podcasting 2.0 i think we had one of the first lightning nodes on the network
• 1:24:17
  back in the day um it's great remember the lightning torch i remember participating in
• 1:24:22
  a lightning torch and not understanding channel liquidity and channel management oh god learning
• 1:24:27
  out the hard way yeah having a nasa excuse me a casa node um remember the casa yeah yeah box
• 1:24:33
  node i had that uh we've come a long way now i can just go into my open claw bot and say spin up a
• 1:24:40
  a Phoenix server and start trading on a L.A. markets for replace.
• 1:24:45
  I kind of this.
• 1:24:46
  The one thing this podcast is looking with is the taste for spinning up my own cloud bot just to counter trade against you I just going to try to poison you because I know you got three kids to deal with so this is easy all i have to do is time it with like their sleep schedules i want to be clear i not i not uh it was a test use case to see if we
• 1:25:02
  could ln url off into a website which you can which is like hey like that becomes a standard
• 1:25:10
  outside of bitcoin like just sign in with instead of google oauth like sign in with your lightning
• 1:25:15
  node like technically like i'm sure you see a moltbook the ai um the social networking like
• 1:25:25
  there's no reason i can't send my i don't think there is i'd have to check but i could probably
• 1:25:30
  definitely send them loose on uh stacker news or something like that with ellen url off it's just
• 1:25:35
  like hey sign up create account and begin posting on here and actually maybe i'll test that out
• 1:25:40
  tonight this is going to happen before we the podcast hits i'm going to see your post on stacker
• 1:25:44
  news from your cloud that it's crazy uh all right you were episode 100.
• 1:25:52
  2020 was probably like oh god 200 i think we actually did 100 200 we did every i think the
• 1:25:58
  second one was 200. really 2021 was probably like around 300 and here we are we took too much time
• 1:26:06
  between that one 7 13 7 14 depending on when you officially announce sig bash where can anybody
• 1:26:16
  who wants to learn more play around with that go i would love it if you tested it at www so by the time you hear this it going to be live on signet because i don want to make the same mistake we did with V1 and have people start playing with money immediately I pretty sure it battle tested and bulletproof at this point but I want to find out the hard way
• 1:26:36
  Who's the one like wallet developer out there that you want to be messing with this?
• 1:26:40
  I know you have a name in your mind.
• 1:26:42
  If he hasn't messed or she hasn't messed with it already.
• 1:26:44
  I'm going to do you a favor and not scream into the mic, but you're just tricking my Gary Oldman and I want to do everyone.
• 1:26:50
  Seriously, everybody, especially come at me if you have suggestions for the SDK.
• 1:26:57
  Right now, the web UI is what's up and live.
• 1:26:59
  So you can get a QR code to scan with your wallet and bang on that.
• 1:27:04
  But I need to figure out how people want to integrate with this.
• 1:27:06
  That's the hard part.
• 1:27:07
  There are so many different models for how you would integrate with a signer, how exchanges
• 1:27:11
  want to do one way, custodians another way, wallets another way, lending providers another
• 1:27:15
  way.
• 1:27:16
  Oh, sorry.
• 1:27:17
  Go ahead.
• 1:27:17
  and I just need to figure out a way to satisfy everyone's needs.
• 1:27:20
  All right.
• 1:27:21
  Use case here at TFTC.
• 1:27:24
  A lot of all boy, all men at the
• 1:27:27
  the company right now, not as diverse as many would like us to be.
• 1:27:30
  But the boys like to get paid in Bitcoin.
• 1:27:32
  They send me ZapRite invoices, obviously with the price moving
• 1:27:36
  different amounts
• 1:27:39
  in sats terms from invoice to invoice.
• 1:27:42
  Could I set up a lot like where I funded a wallet
• 1:27:44
  and was somehow able to get the ZapRite invoice,
• 1:27:53
  use the ZapRite API to get the dollar cost
• 1:27:56
  and the sats cost and then send it to you and say all right I have an idea in mind of a range of bitcoin i willing for you to blind sign like could i set that up so i don have to go in and physically
• 1:28:08
  sign yeah anytime an invoice comes yeah absolutely i wow okay so you just want to hand it all over
• 1:28:14
  to the cloud about to do the signing and they do the no no no the club one has no control over this
• 1:28:18
  i do this so you're gonna do the final i'm getting into the voice i'm like okay yeah sure you could
• 1:28:22
  do that pending when the sdk is released but yeah okay no that would help me massively all right
• 1:28:27
  let's figure it out because there's times when i i get uh an invoice i'm busy i forget about i pay
• 1:28:33
  it like i mean not late but i like to pay it as soon as i get it just to because that is the magic
• 1:28:39
  of bitcoin yeah it's like somebody needs to get paid to send you an invoice like boom money's there
• 1:28:44
  um but sometimes i lapse because i'm busy and it sounds like so you could have yeah and sign for
• 1:28:50
  you if you were if you were busy doing other things yeah yeah absolutely okay sweet solve my
• 1:28:55
  solving business logic problems here all right let's make it happen all right until uh let's
• 1:29:01
  not wait if we wait another 400 episodes i won't see you until the other side of four figures so i
• 1:29:05
  don't think we can do that i don't think i have the right to call dibs on episode a thousand you're
• 1:29:09
  way too big league for me no you do you do you do anybody has dibs you do um but i will if not
• 1:29:15
  1,999.
• 1:29:16
  Okay.
• 1:29:17
  Yeah.
• 1:29:17
  Okay.
• 1:29:18
  So we've got a.
• 1:29:19
  My one condition is that Odell has to be present and even more inebriated than was during the
• 1:29:23
  COVID rip.
• 1:29:23
  I will have my revenge.
• 1:29:25
  Okay.
• 1:29:25
  We're getting, um, we're going to get a very good bottle of whiskey.
• 1:29:28
  I don't drink whiskey that much anymore, but we're going to get a very good bottle of
• 1:29:30
  whiskey for that one.
• 1:29:31
  All right.
• 1:29:31
  Sounds good.
• 1:29:32
  All right.
• 1:29:33
  Until then.
• 1:29:33
  Peace and love freaks.
• 1:29:35
  Okay.