{ "episodeId": "SLP439", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "federico_tenga": { "name": "Federico Tenga", "role": "guest", "tag": "FEDERICO" } }, "segments": [ { "speaker": "stephan", "time": "00:09", "start": 8.61, "text": "Hi and welcome to Stephan Livera podcast, a show about Bitcoin and Austrian economics brought to you by Swan Bitcoin. For this episode, Federico Tenga of Bitfinex joins me to chat about RGB, what he's working on and Iris wallet. Now, for those of you who don't know, RGB is a scalable and confidential smart contract system for Bitcoin and potentially the Lightning Network also. We talk a little bit A bit about what it could enable in terms of stablecoins, collectibles or other assets, how it works, issuing new assets, transferring and deletion, as well as some of the criticisms, one of which is around whether it creates an MEV situation for Bitcoin. So we answered that question in this episode, and we also talk about what he and the team are building, which is Iris Wallet. As mentioned, this show is brought to you by Swan Bitcoin. Swan has a program called Bitcoin Benefit Plan. This is something that you would be interested in if you are an entrepreneur or you have- of employees and you wanna give them the gift of Bitcoin along with Swan's world-class education and customer service. So Bitcoin Benefit Plan makes it easy for you to recruit, reward, and retain top talent with Bitcoin. Swan is handling all the heavy lifting like creating wallets, converting currency, routing payments, and like magic, your employees receive Bitcoin and world-class financial education monthly as a benefit from you. So this is a great way to help teach your employees and onboard them to Bitcoin in a smooth fashion. So if you're interested Interested in Bitcoin benefit plan? Go to swan dot com slash business. Are you ready for something huge? BTC Prague is coming. It's gonna be the biggest Bitcoin event in Europe. I'm happy to be one of the hosts. I'll be one of the MCs for the event. It's gonna be June eighth to tenth, twenty twenty-three in Prague, in the Czech Republic. Now, for those of you who haven't been to Prague, it's a beautiful city. I've been twice. I really enjoyed it. It's also a great opportunity for a small trip, so you might be interested But this is going to be a fantastic event. It's a three-day event where we're gonna have perhaps ten thousand people coming, whether they are fresh newbies, whether they are Bitcoin developers or business insiders, and get connected. There will be more than sixty world-class speakers and a hundred companies to assure both education and fun in this Bitcoin only feast. So this will be a fantastic, relaxed summer atmosphere. You can drink some famous Czech beer, and it has affordable prices too. So go to btcprague dot com, use the code Livera to get your discounted ticket. I'm looking forward to seeing you there. Are you looking for a software wallet? Blockstream Green is an industry-leading Bitcoin and Liquid wallet. It has all kinds of features such as multi-signature security, you can connect it to your own full node Electrum server, and it also has Tor support. So with Blockstream Green, you can use multi-signature shield where you hold one key on your device, one key is held by Blockstream, protecting you with two-factor authentication, and you have a time lock or a third backup key to ensure you always retain full ownership Of your funds. Blockstream Green also has integration with hardware wallets like Blockstream Jade, and I spoke about this recently with my recent episode with Larry Nahum from the team, and it-- there's a range of platforms available so you can use this on iOS, Android, or desktop. So to get Blockstream Green, go to blockstream.com/green. And now onto the show with Federico. Federico, welcome to the show. Hello, thank you for the invitation. Yeah, great. So, happy to chat today about RGB and what you're working on with Iris as well. So, yeah, just for anyone who doesn't know you, give us a little bit of a background for the people who, who don't know you." }, { "speaker": "federico_tenga", "time": "03:36", "start": 216.49, "text": "Yeah, sure. So, I've been involved in Bitcoin for, for quite a long time. like, for about five years, I've been, working on a startup project about, payment," }, { "speaker": "federico_tenga", "time": "03:52", "start": 231.56, "text": "Merchants to accept Bitcoin payments, it was, like, on the Italian market, so like very, very, very focused on one specific region. But yeah, like over the years, I've also been, following, I've been interested like in anything happening around Bitcoin, I've been following all, all the, the, the new stuff that was coming out. And one of the things was like, RGB, which, it's a project that is actually quite old, I mean, it's, it's in many iteration. It came, was an idea that came out in twenty, seventeen from Jack Muzzuk, but it was very different from-- it was still a Satoshi network, but very different from, what RGB is now, and then RGB-C, so a few interaction. And, I was at the period just following, actually, like a follow-along network, like, just as a hobby, just, like, was just interesting to see the, the, the evolution of the project. And, and yeah, actually, I was also contributing Community feedback that were needed, I mean, I was contributing to the project, in my free time, whenever I could. Then, starting earlier at the beginning of, this year, in, twenty twenty-two, I joined, Bitfenix, with the goal of creating a team inside Bitfenix to work on RGB. So, we create a team that, and the goal of the team is basically just to, promote the RGB development and the RGB ecosystem. there are o- other companies, other team working on RGB, but yeah, with our internal team, we try to develop tools to contribute to the protocol itself with PRs and contribute to develop tools for, developers and to, build, user interface application like there is wallet to help people play with that a bit." }, { "speaker": "stephan", "time": "05:36", "start": 336.18, "text": "Sure. Yeah. So give us a little bit of a, the background then. So as I understand RGB, there are multiple people working on this idea, but if you could just at a high level step back and tell us So what is RGB?" }, { "speaker": "federico_tenga", "time": "05:50", "start": 350.16, "text": "So RGB is, is a, is a protocol built on top of Bitcoin, we can see it like a second layer, on top of Bitcoin, that aims at, enabling, the, the issuance and transfer of, of assets on top of Bitcoin. actually the protocol is a bit more generalized, so, there are ideas to use the, the RGB protocols to build all the stuff that isn't strictly assets or tokens, like for example, the centralized identity or stuff like this. But like the, the core use case in the, near future, in the present and near future is mostly like issuance and transfer of assets on top of Bitcoin. And actually the idea is, the, the idea by itself is nothing new. I mean, it's, the, the same idea of, colored coin back in the days in twenty thirteen, you already had these first protocols to build tokens on top of Bitcoin, such as Counterparty and OmniLayers, and, I mean, at the time it was called Mastercoin, but Then became omni layer, and then you have also the other alternative blockchain that, that did the, the same thing to enable the issuance of tokens on top, of the blockchain, also like, some side chains like ICL did the same. Yeah." }, { "speaker": "stephan", "time": "06:56", "start": 416.36, "text": "So you mentioned, some of the earlier ideas that, let's say, came before. So as you mentioned, colored coins and counterparty are probably some of the well-known examples where people were, you know, creating a token and it was like a colored coin or some kind of way of representing equity or some other token. Now How would you differentiate RGB from some of those earlier iterations or attempts?" }, { "speaker": "federico_tenga", "time": "07:19", "start": 438.82, "text": "Yeah, yeah, basically the problem with this first iteration is they, they were designed in a period where, also there, there were, there was different, attention to various pro-problems that you have when you use Bitcoin. So first of all, there was little, attention to privacy and little attention to scalability. So they were, they were designed is that basically, all the data related to the token transaction is, is put on the- Blockchain, under, usually in the, in a operational field. So in the operational field, you, you can see something like, a token A, token A is moving from A to B, from A to B or something like this. I love it in that. So what does it mean? It means that, privacy-wise, you, everybody can see everything, so it's not ideal. And scalability-wise, it's, it's very bad because, basically to understand, which token transaction is valid, you need to scan the whole blockchain And create your own state of the, of the counterparty network or the omni layer network, whatever. And, and it's like quite expensive. If you, if you ever try to, to run a counterparty node, for example, i-it's, it's quite, resource intensive to say. And so, so it's not really scalable, and also, it's not scalable in the sense that, they weren't designed to, to be compatible With the stuff like the Lightning Network, because of course at the time the Lightning Network didn't exist. So RGB, was started as a project that was trying to improve on these limitations, and, the way we achieved this is that basically the blockchain is used only for double spending protection, not to push data So in RGB, the information, the, the, the red token is moving from A to B, it's not written on the blockchain, it's written on a separate layer, and on the blockchain we just put a commitment of this information to leverage the double spending protection that, Bitcoin can offer. So in this way we have more privacy because on the blockchain we don't put, all this data. Also, there are other features that improve privacy, even further that we can discuss later on. And, we have better scalability because basically, yeah, again, we put less data on the blockchain, so we pay less fees, and, moreover, it's easier to build the, compatibility with the, with the Latin network or Latin- At least there is, there is even an effort to do it while there was not even intention to do it with previous protocols." }, { "speaker": "stephan", "time": "09:45", "start": 584.75, "text": "So let me summarize a few points there because there's a lot here. so let's think of it like in the earlier days of Bitcoin and in the days of counterparty, Collidcoin, Omni and things like this, that was pre-blocksize wars or scaling wars. And so, you know, in those days, people just thought of it as like, \"Oh, we could just put lots of things on the blockchain.\" Whereas now, there's obviously more of a size limit, and we are trying to look at ways to do things in a scalable way, and so that's where this idea of taking things off the chain per se has come into the focus. And so that's where this idea of only putting in certain updates, not everything, onto the chain per se is what we're doing, I presume, in a high level way. That's one way to explain a little bit about what's going on with RGB, and I'm sure, you know, maybe listeners may have heard, you know, our friends Jocko Mazzucco or people like Peter Todd Maybe, but, if we can go maybe to one more step of detail, if you could just explain a little bit. Oh, one other question, if you could explain what is an op return and how is that used as part of this, just for people who don't know." }, { "speaker": "federico_tenga", "time": "10:51", "start": 651.0, "text": "So basically, yeah, since the early days of Bitcoin, people saw this, like, immutable ledger, which is the blockchain, and they were saying, \"Oh, yeah, nice, maybe we, I, I could use it also to, to put my own data there.\" So it" }, { "speaker": "federico_tenga", "time": "11:09", "start": 668.61, "text": "Yeah, people were putting all kind of messages or like even images and stuff like this. But this is a, is a problem, like you force all the nodes in the network to actually store those, data for you, and, which increase the cost of running a node, and which is bad for the decentralization of the network in general. So since you can't really forbid this kind of behavior, because, I mean, if I send, some Satoshi's to a Bitcoin address that isn't really a Bitcoin address, it's just a string that encodes some data I mean, there is no way to forbid it because there isn't even not way to detect it. So what at some point, Bitcoin developers did to mitigate these, issues of people putting random data on the blockchain is that they created this, new kind of, of, way of constructing, outputs of a Bitcoin transaction that you can send, you can create a Bitcoin transaction where one of the output is an output that is provably unspendable, means that there is, a script of the, of the output, say, it is impossible to spend this, this output, whatever you put here is not gonna be possible to spend it. Which means that the nodes running, the, running, the, the Bitcoin blockchain, they can see this and say, okay, this is never gonna be spent, so I can prune it out of my of my, i-it's not gonna impact of the output I keep track of, so like, it reduced the, the need for, for, for information, it doesn't need to store those information because there is not relevant for the note to store it. So in a way, it reduce the burden on the note so yeah, it's this special kind of Bitcoin outputs that now, like, people use to, to put the data on the blockchain. It's limited size, only, around eighty bytes can, can be, of data can be, added to a Bitcoin transaction using this, special operator outputs, but it's, very good if you, it's more than enough for stuff like, putting commitment to data, like the hash of data, and then you leverage it. You can disprove that, the data can-- since the Bitcoin blockchain has all these immutability properties, also the data that you put there has some guarantees that it cannot be edited or deleted in the future So it's still good for, for a lot of use cases. And yeah, actually RGB, also is a feature that lets you achieve this without using a protocol, with, with using more advanced tech, but, but yeah, like most of these protocols in the past, they were, they were Basically just pushing that on the apron, in this case, not even the actual data, the raw data, and, so like people can read it and interpret this." }, { "speaker": "stephan", "time": "13:46", "start": 825.79, "text": "Yeah. And so before we go further into the detail of how RGB works, let's talk a little bit about what, like, I think users or listeners might be thinking, well, hang on, what's the point of all this? Like, I just wanna use Bitcoin, I don't care about other assets. Like, what's the point of this stuff? As I under- as I understand, and you tell me what Stablecoins and maybe for some people, now I don't care about NFTs at all, but for some people who care about NFTs, maybe that's useful for them and other kinds of assets. So can you just explain from your point of view what are the main uses, what's the point of using all this RGB stuff?" }, { "speaker": "federico_tenga", "time": "14:22", "start": 861.59, "text": "Well, I mean, we can say what are the main use cases for tokens in the general, like, already existing crypto market. So yeah, people, I mean, yeah, there are tokens for promoting policy schemes, which is one thing," }, { "speaker": "federico_tenga", "time": "14:37", "start": 876.88, "text": "May not be more valid. So one of the instable coins for sure the more, most popular, use case for, for tokens on top of, Bitcoin and other blockchains. And, and yeah, the stablecoin is actually like a key element to enable like the centralized trading, because yeah, right now people that wants to, to trade, they either go to, to centralized exchanges like, like FTX, or others that, that are managed better than FTX. Or, to, automated market makers on Ethereum, which they, in a way, they use a stablecoin, but also they have other problems that maybe we can discuss later on. But the idea is that, like, we need stablecoin to enable, like, decentralized trading. If we have a stablecoin on top of Bitcoin, we can have, like, neted, like, atomic swaps, on the same chain between, Bitcoin and, a stablecoin, and, in this way, it is possible to" }, { "speaker": "federico_tenga", "time": "15:35", "start": 935.14, "text": "Bitcoin against USD or whatever, so I mean, you can short the US dollar directly on Bitcoin and stuff like this. this, yeah, this is-- And also like currently, I mean, we love to the idea that, everybody, in, in the world will use Bitcoin for payments, but the reality is that, most people don't, want to bother, with the volatility of Bitcoin. So currently, stablecoin are playing a, a real role in, in emerging markets where they have a, a weak local currency. See that it's up to hyperinflation, I mean, real hyperinflation, not the one we, we complain in, in developed economies, and, and the US stablecoin is, is something that helps them right now to solve that problem. They have exposures to the US dollar Which, we don't like, but for them is, orders of magnitude better, so of, of, what they have right now of their local currency, and they can use it freely, without having to rely on, banking infrastructure that doesn't even, exist, in, in their countries. So right now, like, if we, can enable people to pay with stable coins, it, it already makes a huge impact. And we may say that, like, a stable coin may not last forever, which is fair enough, it's the reason why we need Bitcoin, but, right now, it's, it's, it's perfectly, I mean, it's, it's a use case that people need, whether we like it or not. And, and yeah, to let people do it on, on top of Bitcoin instead of, of other like, blockchains that, can have, like, security trade-offs, it's for sure something desirable. Then other stable coin, yeah, like, I mean, like e-even myself, I, I'm, I never bought an NFT in my life, and, and, I don't, feel the need to do so, but there is, people that, are into it, there is obviously a market for it. Actually, it was one of the first, use cases, built on top of Bitcoin were like these rare papers in twenty thirteen that were basically NFTs, but, yeah, with I mean, yeah, also NFT is a very specific term. I like to use more the collectible tokens, which is a bit more broad. there is an interest for collectible tokens, I think they're also connected to the gaming industry. I hear a little people working in the gaming industry that are so interested in it. Not everybody needs to be interested in it, even myself, I'm not, I, I don't have a huge interest in collectible tokens, but it's still a use case that is there in the market, and, yeah, if people can No, and then like the third use case that I see that is not, currently really, working right now, but in a future where security tokens, there is a Some jurisdictions with good regulation for security token also thought they messed up playing a role in this ecosystem." }, { "speaker": "stephan", "time": "18:28", "start": 1108.2, "text": "I see. So let me summarize then. So stablecoins are pretty obvious, I think most people understand that, but maybe there are people in the developing world who, of course, understand there's a risk with the likes of stablecoins, but they may prefer that to, or they may not have an option where they can have USD with their local bank in their local country. And so for their, from their point of view, maybe they prefer to use Tether. And so hypothetically in the future, and So you work for Bitfinex, and Bitfinex has, you know, commonality with Tether that in the future we could have Tether that's issued on top of RGB, presumably, and using your RGB wallet, then the idea is that the customers or the users can have Tether as part of an RGB asset that they can trade back and forth. That's, that's kind of one of the ideas, like in the future that, that would happen, right? Yeah, yeah. If everything works" }, { "speaker": "federico_tenga", "time": "19:14", "start": 1154.07, "text": "well, yeah, that would be a nice" }, { "speaker": "stephan", "time": "19:16", "start": 1155.67, "text": "achievement, yes. Yeah. And so that's And then the third aspect is in the future, if it's actually an explicit security, right? It's not like this kind of nonsense FTT token and stuff like this, but if it's like actually the regulatory environment of this particular country, I mean, who knows, maybe even El Salvador with their digital securities law, maybe they would-- people could actually trade actually registered securities, you know, inside an app using this kind of technology. Is that kind of high level, I'm getting-- is that the right idea or how would you explain it?" }, { "speaker": "federico_tenga", "time": "19:49", "start": 1189.15, "text": "No, yeah, this is the main Also, maybe there are other kind of use cases that people can work on, like a gift card or like a generic kind of credit, stuff like this. But yeah, like maybe I would like also to address a com- a common critic of it is like, why do we need a decentralized blockchain like, Bitcoin for, assets that are inherently centralized? Which is like a fair point, but the thing is, first of all, like, okay, having a centralized issuer is one thing, but having a centralized, maintainer of a centralized ledger is, is an extra, counterparty risk that, that you may be happy to avoid. And also issuers themselves, they may not want to, like in most cases, they, they don't have the, the capabilities to manage their own infrastructure to, to, to move the, the asset, the, the, the issuing. So, you would, they would have to delegate to a third party, so you add the, another party that you need to trust, while if you use something that is decentralized, you avoid this extra risk. And, and yeah, maybe like, i-in the future, Bitcoin fees may be very high, so, a lot of people may, prefer to use a centralized layers to, to do this kind of trade, I mean, like, For a lot of stuff, maybe you can use a secondary stop on top of Bitcoin like Lightning or But it may not work for illiquid assets. but yeah, if people prefer to, for low value transaction, people may, may, may, may say, okay, why do I need to deal with all this centralized stuff? I can just use a centralized layer and it works better. But if you are something that has a lot of value, say you have, you're holding like ten millions of stablecoin or ten million of security or whatever, you still want the most secure layer that is out there So you are willing to pay the price that, that in terms of fee and complexity, that Bitcoin's, that is necessary to use Bitcoin, because you have such, such a high quantity of value at stake that, that you prefer to have it on the more secure, Blockchain, the most secure, decentralized ledger, rather than something else. So I think that, there will always, be some people that even with, assets issued by a centralized issuer, they would still prefer to hold them and move them on a decentralized, more secure, ledger like the Bitcoin blockchain." }, { "speaker": "stephan", "time": "22:10", "start": 1329.52, "text": "Yeah. Okay. So let's actually get into some of the technicals now and talk a little bit about how it works. Now, as I understand, currently today with RGB, we're, we're acting mostly on chain and in the- In the future, there's this idea that we can do it in a more like Lightning, let's say. But let's just start with the basics of how would you create a new RGB asset and how do we send those assets to each other?" }, { "speaker": "federico_tenga", "time": "22:32", "start": 1352.3, "text": "Yeah, so basically when I create, a new RGB asset, what I'm doing is I'm creating kind of like a, a contract, let's say, where I say, okay, I am creating, one thousand unit of, asset A and I assign it to the, Bitcoin, so that is for, for this quantity. So basically it's just a contract that, created the concept of a new asset and assign it to an existing Bitcoin, so, so it doesn't even require an on-chain event, the issuance. You just say, \"I, I assign this, new asset to this existing Bitcoin, so, or to a list of Bitcoin, so, you can say, \"I issue one thousand unit and assign like one hundred to Alice, one hundred to Bob, and so on and so forth.\" And, and yeah, this is basically the then, of course, you can add like, extra metadata, extra parameters, so you can add extra complexities, but the, the, the very simple, basic case is simply asset, I, I give the, the asset, re-registered asset, registered token, assigned, well, the supply, max, maximum supply one thousand unit assigned to Alice and maybe other people like in fractional way. Then when I want to transfer the assets, the asset has been allocated to, in this case, the UTXO of Alice. So the, only way to move the asset is to prove that you're the owner of the UTXO of Alice, and the way you can prove it is by creating a Bitcoin transaction that has as input, the UTXO, the Alice UTXO. So Alice creates this transaction that put, and, and, among the inputs, he has the, the, the UTXO that where the asset were allocated, and then he creates, a body of the RGB transfer which says, okay, this, one hundred tokens that before were al-allocated to the, UTXO of Alice, now they will be transferred to the UTXO of Bob or Dave, whoever, she wants. This UTXO where the assets are be- Sent to their already existing utxo on the Bitcoin blockchain, so she could actually send this asset to the, utxo of Satoshi from two thousand nine. It doesn't, it's not gonna be, it doesn't need to be a new utxo that you create with the transaction, it can be an already existing one. So once you created this, body of the RGB transfer, which said this token are moving from Tixxo, of Alice to Tixxo of, Satoshi, then, you, you basically create-- To simplify, you create the hash of of this, transfer, and you committed in the Bitcoin transaction that is spending the UTXO of Alice that, had the asset before. So in this way, you're proving that you're the owner and you're committing to the destination of where the assets are going. But without revealing it to blockchain observers. Blockchain observers just saying, okay, there is, some Satoshi that are moving from, with XOA to a new Bitcoin address. The new Bitcoin address will, not only be, a change address, of, of the sender. So the blockchain observer doesn't see anything. But the, the receiver of the transaction, I could say Bob is the receiver of the transaction, will receive from Alice the body of the RGB transfer, and he will be able to verify that this RGB transfer was committed inside the Bitcoin transaction that was spending the two xoxo of the assets. So, so in this way, only the party involved in the transfer are aware that the transfer even exists, because the only the receiver basically is the one that needs to validate that this transfer is valid. Everyone else is, is not his business, isn't interested in it. So in this way, the block, block chain server doesn't see anything, it just sees a normal Bitcoin transaction, one input, one output, nothing, He may, he may use some heuristics to suspect that, an RGB transaction may be involved, but, yes, no way to, to prove it. And the, the, the receiver, of the transaction can, validate that the RGB transfer is, is valid according to RGB validation rules, and it has been committed to the, to the right Bitcoin transaction. And once it's done this validation, it can be sure that, he actually received the asset and he will be able to spend it in the future. And, And they are the only one aware of, that the, this actually transfer actually happened." }, { "speaker": "stephan", "time": "26:56", "start": 1616.4, "text": "I see. So just summarizing, let's say you can create an asset, like, let's say you create Federico coin. You know, you make a hundred Federico coins, and as we said, you don't have to do a new transaction to issue the asset, but when you spend some of those Federico coin, let's say you send some Federico coin to me, as an example, I use my, in this example, Iris or whatever RGB wallet, I- Create, is it like a blinded, kind of like an address sort of thing, and then you can send some, you know, fifty Federico coin to me, and at that point there is an on-chain transaction in Bitcoin blockchain, but there's not like an op-return or something there, it's just as part of that transaction, my wallet, let's say, is able to read that and see, Federico sent me fifty Federico coin. Is that sort of roughly what's happening there? Yeah," }, { "speaker": "federico_tenga", "time": "27:45", "start": 1664.57, "text": "yeah. Only your wallet is able to, to understand it because it's the only one Yeah. So I send directly from my wallet to your wallet, direct communication, I send you this information." }, { "speaker": "stephan", "time": "27:56", "start": 1676.32, "text": "Yeah, I see. And as we're saying right now today, it's all on chain. So that means every time there's an RGB asset transfer, it's all happening on chain, which means obviously that won't scale longer term, but for now, that's kind of where it's at before we move to the next level, right?" }, { "speaker": "federico_tenga", "time": "28:10", "start": 1689.53, "text": "Yes, but also we, actually already today, we have, some, on-chain scalability that we can already leverage in" }, { "speaker": "federico_tenga", "time": "28:21", "start": 1701.3, "text": "I can also send, I can also with the same transfer pay, other one hundred or one thousand people, any amount of people. I can send, some tokens to your Tixo, but also to the Tixo of, Alice, Bob, the Carol, David, and so on. Yeah. And, this doesn't increase the size of the Bitcoin transaction. So, yeah, the, the Bitcoin transaction containing the commitment is still like, in the best case, one input, one output, and then it's committing to committing to a transaction Transfer that, is paying like, an arbitrary large amount of people. So, maybe for normal people, it's not so common, it's not so common for like a regular user to pay a lot of people, but for service providers, it's very common. So if I'm, an exchange operating, we draw to a lot of people, instead of, like right now with any other, like, token protocol or any other, like, crypto payment, more in general, I basically need either to create one transaction for Or one transaction with a lot of outputs that means that it becomes like a very large transaction that takes a lot of bytes on the blockchain. With RGB, you create a simple transaction that, that, that, that is the, the, the normal size, like, two hundred, three hundred bytes. And you pay as many people as you want. So basically the, marginal cost of, oper-operating a withdrawal to your users can go like close to zero if you're paying a lot of people together." }, { "speaker": "stephan", "time": "29:52", "start": 1791.65, "text": "Back to the show in a moment. My favorite Bitcoin hardware wallet and signing device manufacturer is CoinKite dot com. They have a range of products, notably the Coldcard, which is their top-of-the-line Bitcoin hardware signing device. It's a very reliable performer. I've found it very useful in various setups, whether you want to use it as part of single signature or multi-signature. It has all kinds of other features like BIP 85, which allows you to have child seeds. So, for example, you can have one seed that you retain. And you can have child seeds that you give either for other wallets or, let's say, if you're helping your family or friends so that you still have the backup. There's all kinds of features available, you can learn more over at coinkite dot com, get a discount on your coldcard with the code livera. Now, when it comes to partaking in the Bitcoin space, you need to be able to search your Bitcoin transactions, and my favorite block explorer is mempool dot space. Bitcoin is a multi-layer ecosystem, and mempool dot space is helping you by showing you the various aspects. Of this ecosystem, whether you are seeing the mempool, whether you're seeing the blockchain, whether you are seeing second layer networks like the Lightning Network, you can use the Lightning Explorer to search other Lightning nodes, you can even see Lightning channels, and you can even see the outer point, which is the actual UTXO that represents that Lightning channel. So I think it's a phenomenal Bitcoin and blockchain explorer. You can use it to search your transactions, and you can even self-host this, so you can run it yourself. 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And if you're interested to learn more about how it all works, you can find out more at unchained dot com slash concierge. Use the code Livera for a discount there. And now back to the show. I see, yeah. And so that's, yeah, so that's an interesting on-chain scalability approach. And so then you can issue this coin, and so then, and presumably then every time it transfers again from that person, so let's say you send me fifty Federico coin, I can then send that on, and it's the same kind of process that it's just like one input, one output, same aspect. And then whoever I'm sending to, they do that same validation on their side. Oh, okay, Stephan has sent me fifty Federico. Bitcoin. Okay. And so then, is there a possibility of like conflicts and then you need to sort of check against the ledger or how, how does that work? Like, how do you stop there being any conflicts of, let's say, who is the true owner of these coins?" }, { "speaker": "federico_tenga", "time": "33:04", "start": 1984.08, "text": "Well, basically like the way to-- the, the way we have to resolve, conflicts is the, yeah, to leverage the, the Bitcoin blockchain. So, if somebody tries to create a fake RGB transaction, let's say, try to do, to do a double spend, I'm trying to pay" }, { "speaker": "federico_tenga", "time": "33:22", "start": 2001.73, "text": "how would that work? So I create, an NFT, okay, I, I have my, my tokens on my E-wallet, like, those I have for real. First, I try to pay you, I create an NFT transfer that is paying you, and then another NFT transfer that is paying someone else. the thing is that, the Bitcoin transaction that is pending my TXO can only contain one, one commitment. so the, the way that the commitment scheme is designed, like, basically if you put more than one commitment, only the first one is the one that we, we will only look at. So it can only contain one commitment, so either co-contains the commitment of the, the, the transfer I sent to you, or it contains the commitment of the transfer I sent to someone else. So, when you validate the, the, the, the transfer that I sent to you, you will check, okay, is my transfer committed inside the Bitcoin transaction spending the UTXO that I'm talking? If yes, then you're, you're sure that you are the only person receiving the token. If not, you know that I'm trying to, to scam you basically, to, to Something that I already spent. And then, yeah, of course, you can have reorgs on the blockchain, but then, yeah, you, you, you manage them how you manage a Bitcoin," }, { "speaker": "stephan", "time": "34:32", "start": 2071.67, "text": "yeah, the same way normal reorgs are done. Yeah. And in terms of validation, what kind of things do I need to run on my side? Like, do I need to run an Electrum server or like, how does the, you know, if I want to validate that transaction that you send me, how do I do that?" }, { "speaker": "federico_tenga", "time": "34:47", "start": 2087.32, "text": "Yeah. So basically, first of" }, { "speaker": "federico_tenga", "time": "34:53", "start": 2092.73, "text": "Validates all the RGB specific rules, and then you need to check that, those, Bitcoin transaction that say, where I claim there is a commitment of the RGB transfer They actually exist on the Bitcoin blockchain. so currently, like Iris and also the, the other, wallet that other people are working on, they use an Electrum server to do so. but yeah, in general, you just need to, to check that those transaction exists on the blockchain so you can use any indexed, blockchain to do so. But yeah, currently, like everybody's using Ganache from Cypher to do so." }, { "speaker": "stephan", "time": "35:30", "start": 2129.73, "text": "I see, gotcha. And so what about if there's changes down the line? So let's say at the start you issue one hundred Federico coin, but now you wanna issue another one hundred, or, you know, can you, can you create new coins or can you, like, how, how do you stop that or Basically," }, { "speaker": "federico_tenga", "time": "35:49", "start": 2148.76, "text": "there are two ways of doing it. The simple way is to, let's say you, when I issue like a Federico co- coin, I just issue to the like a maximum number possible and I allocate it to one UTXO, and this gonna be like, the total supply, and then, I, I move to another, UTXO what I want to be the circulating supply. So people can, a-as long as people see that the, the xPub containing all the tokens not being spent, they can verify that what is the circulating supply against the total supply. And then, like when I spend it again, I can disclose a much of the stock in I put in, in circulation, and, and people again can verify what is the circulating supply against the total supply. And another way of doing it, there is a feature that is being built in RGB is that to have, basically the right for secondary issuances that we- which actually will work in a very similar way, I assign the right to issue more stock and to unlock it so. that yeah, usually will, will be mine, Tixol, or can be another person with Tixol. And, and yeah, like when you spend the Tixol, you have the right to issue new, new tokens. So yeah, in, in general, like, it's similar to how it works in many token protocols, like on, on other chains. That is, basically when you have the, the right to issue again, there is one, usually in those case one key, but in the case of RGB one Tixol," }, { "speaker": "stephan", "time": "37:21", "start": 2240.73, "text": "Yeah. So that would be, like, thinking of the stablecoin use case. In this example, let's say you're creating a stablecoin and you, you know, people have sent you one thousand USD in fiat, and now you have to create one thousand stablecoins, and then now they've done more deposit, so you have to create more stablecoin. It's the same kind of idea. So you, you might have that, or let's say in the future, Tether might do an RGB, you know, RGB Tether and do this kind of process, and then, but on that There can be transacting tether with each other, but there's only one issuer of the, you know, that tether. And so I guess in that case, how do you make sure there's only like one true issuer or is it like a white listing process or how do you make sure that you have the real, you know, the real stablecoin, asset?" }, { "speaker": "federico_tenga", "time": "38:07", "start": 2286.67, "text": "Well, yeah, that's like, yeah, common problem with the all digital assets, like how we are sure that it's the real one. So, yeah, basically the issuer will have to disclose, but the, the what makes, I, I- Like when I issue an asset, I can give it any name. I can call it, apple shares, I can call it tether, I can call it anything. So there is no guarantee that the, the asset name is, is the true reflection of what the asset is. so the only thing that makes the asset unique is the asset ID, which is like, yeah, a unique identifier, that, that basically, you use all the parameters that everything that contributes to the issuance goes into this asset ID, which makes it unique. And, and so yeah, the issuer, like if Apple issues Apple stock on, on, on HB, Apple will ta- will have to disclose what is the HB ID of the true Apple stocks, so yeah, either user, check it every time they receive, check it manually every time they receive, a Microsoft or more realistically, the wallets will be able, will whitelist the popular assets that, they are aware of and they will mark them as verified or something. Something, but yeah, this is a wallet level" }, { "speaker": "stephan", "time": "39:19", "start": 2358.71, "text": "thing. One other question, now going the other way. So instead of issuing, but what about deletion? Or let's say, in this example, let's say the Tether user, the RGB Tether or Tether RGB user wants to redeem some back into fiat, into USD cash. So let's say he sends you, you know, a thousand Tether RGB, and now you need to lower the supply. Is that the same, similar kind of process, only this one key can do it?" }, { "speaker": "federico_tenga", "time": "39:42", "start": 2382.24, "text": "No, no, actually, like, like yeah, to lower the supply, you need to basically burn tokens, and, yeah, anybody can burn tokens. So yeah, like probably something like a stablecoin, more realistically, yeah, you send it back to the issuer because the issuer then, Like, gives you back something else, and the issuer will operate the proof of burn, so we will burn the token and create like a public proof that that quantity of tokens have, have been burned So wallets can keep track of the wallets or anybody that is interested can keep track of the circulating supply of the token. But yeah, potentially anybody can burn it, just that in RGB you can burn silently, so you could-- there isn't, isn't visible to a blockchain observers how much stuff has been burned, so, you won't have to disclose it. So in this case, yeah, the person, the entity that would be interested to- To make sure everybody is aware of the burn will be the issuer to, to go for transparency on the circulating supply." }, { "speaker": "stephan", "time": "40:42", "start": 2441.72, "text": "Gotcha. So I guess the short answer is the stablecoin issuer in this, in the, in that example would do a public proof of burn basically and then give back the dollars or whatever other asset. and so the other question, I guess is to get into sort of the Taproot and Lightning aspects of it. So currently, is RGB and Iris, in this example, specific example, is it using- Taproot now or is the idea to use that in the future?" }, { "speaker": "federico_tenga", "time": "41:09", "start": 2468.9, "text": "RGB supports Taproot now, but Iris isn't using it right now. So, there are two ways to commit to an RGB transfer, in RGB. Once is by, putting like the, the hash of the RGB transfer, which is actually top hash of a Merkle tree with a lot of data, but to simplify the hash of the RGB transfer, in an operator, which is, Not so elegant, but it's very simple to implement. And the other way is to put it inside a leaf of the taproot tree. So you create a taproot output, which will also gonna be the, the output where you send your change, Satoshi's, back to. And then the taproot output in, in, a, a tap leaf of the, of the taproot tree, that, that can potentially contain all the scripts or, or just the internal key for the simple case. Then you put the commitment to the RGB transfer. In this way, there is, you save about like forty bytes of on-chain data, and, you take away one heuristic that people can use to suspect that, that one is an RGB transfer. Even with the operator, actually, I mean, you just see an operator with an hash that could be like OpenTimestamp or anything else, so you don't have a proof that is an RGB transfer, but still this is an heuristic that people could use. So yeah, there are these two ways. Currently, Iris is using the operator one because it's just We start with the simple one, but yeah, in the future we, we will probably, eventually migrate to the Taproot, commitment." }, { "speaker": "stephan", "time": "42:38", "start": 2558.2, "text": "Okay. And then what does it look like if you're going to Lightning and you're trying to do something like Lightning? How would, what would that look like?" }, { "speaker": "federico_tenga", "time": "42:46", "start": 2566.22, "text": "Yeah, basically like, RGB transaction, RGB transfer commit to Bitcoin transactions. Those Bitcoin transactions can be broadcasted on the blockchain immediately or they can be, Lightning channel updates that may or may not be settled on the blockchain. Right away. So, what you will do, what, what, what, we plan to do is not been, it's, there is some work has already been done, but the implementation of the Latin part, is still, yeah, still needs to be done. what we will do is basically to get RGB transfers that commit that, which, of which the commitment is, inside the, channel update of a Latin network channel update, and so I can, as I can replace the, And, like a network channel update for Bitcoin transfers, I can do the same with RGB transfers. So I create an RGB transfer, we create, we have a Latin channel between each other, then I create an RGB transfer that moves, like, yeah, one hundred tokens to you, I commit it to, to our channel update transaction, and then, we don't broadcast it to the blockchain because then you will send me back, like twenty tokens, and we will do an update where that we will update with a new RGB transfer that only move eighty tokens to you because actually Hundred to you and twenty back to me or something like this. And, and then, yeah, with the same mechanism, you can also do, do routing, through a series of, RGB wallet channels." }, { "speaker": "stephan", "time": "44:13", "start": 2653.0, "text": "I see. So, yeah, so it would take a specific RGB Lightning format, and there may be kind of like, i-it's not exactly the same as the Lightning Network today, but it's similar, conceptually in certain aspects, but has other aspects that are different, I suppose. It's" }, { "speaker": "federico_tenga", "time": "44:28", "start": 2667.77, "text": "gonna be like a separate network, but Still like, leveraged the, the same core, the same technology of the Latinatum here." }, { "speaker": "stephan", "time": "44:36", "start": 2676.34, "text": "I see, yeah. Okay, gotcha. So while we're here, could you give us some of the similarities and differences with Taro then, because I'm sure that a lot of listeners will be curious about that. So how's this different from, say, Taro?" }, { "speaker": "federico_tenga", "time": "44:49", "start": 2688.72, "text": "Yeah, so like, first of all, like, I'm not a huge expert of Taro, so I, I, I, I may have, I may do some little" }, { "speaker": "federico_tenga", "time": "45:01", "start": 2701.19, "text": "Are quite similarly designed, which are actually, I mean, it's good because the, the client side validation model is being validated as, as, as the, as the design, so it's not only here to be doing it, but also someone else. So it's- It's, it's good that, we validated the, the design is, is actually good. So yeah, like Taro works in a very similar way to everything that we just described. The only, like, of course, like the implementation is gonna be significantly different because they, they use like another, language. Actually, it's mostly written in Rust, Taro is mostly written in Go, and also like, yeah, of course, that when you implement stuff, there can be a lot of differences in the implementation, but on the protocol side, the main difference, The, transfers happens. So as I was saying before, in RGB, I can, I have tokens to one utxo, I can move it to any utxo, in the, on the blockchain, also like already existing ones. While in Taro The way they are, doing it is that you can only transfer token to outputs of the same Bitcoin transaction, that, is spending the OTXO and that contains the, the, the commitment to the Taro transaction. Which, basically the consequence of it is that, first of all, like you create a, a link on the blockchain between sender and receiver. still it may not be, apparent that that is a Taro transaction, but if you do, you have a clear link who is the sender. Center with the receiver, what we touch be you don't, even if you understand that that one is an RGB transaction, you have no idea who received the tokens. And, and, and actually, I, I forgot to mention before, but in RGB, even me, when I send you the token, I don't know where I'm sending them to, because you don't show me your xPub, you show me like a blinded xPub, so I'm not able to monitor when you will spend them again. So you have like also privacy from the people that send you the token, which For it, and I don't see anything of your current balance. I can still see, oh yeah, oh, look, Stephan spent a Bitcoin to the centime, like last week, and I can know why you let your financial Privacy, equality, business possible. In Taro, yeah, basically you can only, move Taro tokens to the outputs of the same Bitcoin transaction, which means that But me as a sender and any blockchain ob- observers can see where the tokens are and when they will be spent in, in the future. Any blockchain observer that is aware that that one is a Taro transaction. This also has another consequence that basically you need to, add one output for every receiver of the Taro transaction, which means that the, the case of a service provider that is paying like, hundreds of people together, it needs to create, yeah, it can still be one single Bitcoin transaction, but it will be a single- Bitcoin transaction with a lot of outputs, which, yeah, will cost more in fees, so you, you miss on the batching capabilities that RBS And also, like, the other consequence of that is that basically if I need to create a, basically I need to create a new xPub for you to have the Terra asset, so I create a Bitcoin transaction and I need to create outputs where I can send the tokens to, and those outputs also need to have a Bitcoin balance. So it would be weird for me to also spend some of my Bitcoin to, to give them to you because I would have to price it in transaction, it would be complicated. So what will, realistically- Really happen is that you as a receiver need to add an input to the transaction so that you can contribute for the Satoshi's needed to create the new Tix for you, which adds a bit of complexity, but that is fine, that can be handled by, by a good implementation but also yeah, again, it increased the size of the transaction because you need, we need to add an input which actually is also much larger than an output, so it, it increased significantly the size of the Bitcoin transaction and consequently the cost. So yeah, those are the main differences I'm aware of. For everything else, of course, there are small differences here and there, but then I wouldn't say nothing that, significantly change the trade-offs. also like, yeah, actually another thing is that, like, but this is more like an implementation thing. like Taro team seems to be more focused on one use case, it is like, stable coins, while RGP is being developed in a more generalized way that can more easily accommodate also other use cases. So yeah, like this is maybe why Taro can move a bit faster with implementation because they're targeting just one use case, while RGP is trying to build something more generalized, more future proof." }, { "speaker": "stephan", "time": "49:38", "start": 2978.33, "text": "Okay. And probably I guess fair to say Taro is maybe a little more, like, they're starting with lightning, I suppose, than, actually, I think Starting with on chain, but maybe they're gonna, they're gonna kind of shift into the lightning aspect of it sooner because they are a lightning team, right?" }, { "speaker": "federico_tenga", "time": "49:53", "start": 2992.7, "text": "Yeah, absolutely. You need on chain to have lightning, because the Alatino itself is built on top of, on chain. but yeah, again, this is, I mean, implementation-wise, they may have an advantage because they have already updated the lightning node. They will have to do significantly changes to the lightning node, so it's still not gonna be a working part, but, but yeah, for sure they Compatibility because of the team that's for sure here." }, { "speaker": "stephan", "time": "50:19", "start": 3018.75, "text": "Okay, so let's talk a little bit about Iris Wallet, right? So we've been talking, I guess, in a little bit about both things, right? We've been talking about RGB, the broader idea, and then Iris. So do you wanna tell us specifically about Iris and what you guys are doing? I've, I've had a chance to play around with, Iris Wallet on my phone as well. So what can you tell us about Iris?" }, { "speaker": "federico_tenga", "time": "50:38", "start": 3037.53, "text": "Yeah, so basically, Iris is, is a Android wallet, we developed mostly with the goal to have something that the end user can play with to have a feeling of what RGB is like and to start maybe to, to build the first, basic use case. We need to have like a reference wallet that people can use. Yeah, so to, to-- but we also build it in a, say, scalable way in the sense that to build Iris, we first build a, a library that, an open-source Rust library that any wallet developers can use to build their own wallet without having to Fully, understand all the technicalities of RGB, because RGB is actually a quite complicate, complex protocol. So if every wallet developers needs to fully understand RGB, it's not gonna, we aren't gonna be a large amount of, RGB-compatible wallets, and like ex-existing Bitcoin wallets, they, they wouldn't bother to, to, to integrate RGB. So we, we built this a-algorithm called RGBlib, which abstract most of the complexity of RGB and provide a simple interface, that is very, so, that it makes it much easier To build a wallet. So with the Rust library, we made also the, the, the binding for Kotlin, so then the your mobile device actually run the full Edge B node and, and And doesn't use any external, it doesn't rely on external services if not on Electrum server to, to validate our transactions. Actually, I also realized, so, for the Electrum server, it connects to an Electrum server by default, it will be the Electrum server that we provide, but you can change it to your own Electrum server. So, so yeah, you have like better privacy and, and everything in that way. And also another service that you use is, currently use, what we call proxy server to exchange, data between sender and receiver. And, there is this remote server that makes sure that transaction can happen even if the two parties aren't online at the same time. So let's say I'm sending you, an energy transfer, but you're not online right now, I send it to this proxy server, and then when you are online, you ask the proxy For the data, you can validate it and, and move forward with the finalization of the transaction. but also this proxy server can be like, right, by default is our proxy server, but you can set up your own proxy server and, and use like any proxy server you want." }, { "speaker": "stephan", "time": "53:03", "start": 3183.05, "text": "Gotcha. So for people who wanna play around, they can download Iris wallet, yeah, and it's currently testnet, so you, you need to get some testnet Sats. I think it's over ten thousand Sats to be able to issue an asset, and then you can" }, { "speaker": "federico_tenga", "time": "53:17", "start": 3197.16, "text": "Play Store, you can download there is the test version, so you don't need even to put real Bitcoin to try it, and, you can like issue assets. There are like, two kind of assets you can have like Fungible, which are like normal assets, collectible, which are assets which are modified, like for NFTs, let's say. So yeah, you can use those, you can move them around, you can play around. And then, yeah, there, there is also like a faucet service that like, lets you ask for like free token that you can receive just to, to also, if you don't have anyone else that you can play with, you can just receive the token from the faucet service. So yeah, right now it's more like a playground for end users to, A feeling of what RGB is like and towards like see how it was be, be anything, but then like then of course like, it will evolve, I think Iris will evolve in a power user product, and then there will be other wallets that, that will be maybe more like, if we want to have, when there will be a StepperCoin, maybe there will be a wallet that only has like Bitcoin and StepperCoin to keep it simple, you can't issue your own stuff in the wallet. There will be like more user friendly wallets, that I expect it Adoption while Iris would remain more like a power user" }, { "speaker": "stephan", "time": "54:30", "start": 3270.11, "text": "tool. Gotcha, yeah. And also now might be a good time if you could help explain some of the ecosystem a little bit around RGB just quickly, like who are some of the different entities? Because I know there's, obviously there's Bitfinex, there's this LNP-BP association. If you could just quickly explain some of the different entities there." }, { "speaker": "federico_tenga", "time": "54:47", "start": 3286.92, "text": "Yeah, actually one of the cool thing of RGB is that it's not like one company like, developing a protocol for its own business goal, but it's an ecosystem of company" }, { "speaker": "federico_tenga", "time": "54:58", "start": 3297.53, "text": "Or like a common goal, so it's more like an industry ecosystem effort rather than just like one company. So yeah, basically there are currently companies working on RGB, is yeah, with Phoenix, with our team, then there is the, LMPBP Association, which, is a Swiss association that is being used to finance, the, the work of Maxim Orlovsky, which is the developer that did the most of the protocol work so far. Then, Maxim also has his own, For profit company con-called Pandora, where they are working also on a, wallet implementation. Then, there is, another company, American company called the Diba, which stands for Digital Bitcoin Art, where they plan to do collectible and NFTs, and they have their own wallet called the Bitmask, which is a browser extension similar to MetaMask in a way, and they, yeah, they're working to integrate RGB into this wallet that they already have. And, And then there is, yeah, another like, not really company, more like nonprofit, association in Japan called Diamond Net, which also is working on their own wallet and, they're, using, RGBlib, so yeah, there will be some, synergies with, with Iris. And yeah, then there are like a lot of independent contributors that, maybe Working there on" }, { "speaker": "stephan", "time": "56:20", "start": 3379.78, "text": "Gotcha. And one other area that we should address as well, we've seen discussion in the community, now people have seen this idea of M-E-V, so it stands for Miner Extractable Value. Now, one of the criticisms that people leave or, or put up against some of these ideas is that if you create alternative assets that are using Bitcoin, and especially in the case where the asset value of that other asset goes higher than what Bitcoin's value is, or Or at least in a Bitcoin block sense, does that create some kind of incentive for miners where they try to game the system to their own benefit? If, let's say, a Bitcoin miner can try to put things to their advantage by either delaying or advancing forward a particular transaction. So I'm curious your thoughts on this kind of criticism and whether it applies to RGB or not." }, { "speaker": "federico_tenga", "time": "57:09", "start": 3429.1, "text": "Well, so there are like two things to be saying here. So first of all, compared to like what happens on Ethereum, with RGB, like miners don't have visibility On what's happening, so it's not like they can, delay a transaction, to, to, to gain an advantage because they don't even see that, first of all, they don't see that that one is an RGB transaction, even if they suspect it, they have no idea of, what this RGB transaction is moving. So there, there is really like no way for a miner to gain an advantage with RGB. And then, but still, like, people say, \"Yo, but, me as a big token holder or a big token issuer, the, the miners to do a reorg or whatever like with the chain to, to change something with the chain for my advantage, which is something that, absolutely may happen in the future, but, it's also something that can already happen with, without talking something Of a Bitcoin, because, if I am, like a sender of a big, big Bitcoin transaction, let's say I'm sending like, alpha billion, of Bitcoin to someone else Then I have a very high economic incentive to brag the miner to do a reorg of the transaction or select a deep reorg potentially. So there is already incentives in, in place to, to bribe miners. So I don't think like RGB or any other, token protocol on top of Bitcoin will significantly like change the, the incentives. It's just basically, I mean, what's the difference to have, A Bitcoin transaction sending like, one hundred million or a Bitcoin transaction committing to moving one hundred million of stablecoins or tokens. I mean, there is still the same kind of economic incentive that, could, could make, the miners, be want to be bribed So I don't see like how tokens add an extra risk, if not for the fact that we're moving more value, but it's the same risk of people actually starting using Bitcoin much more. So, yeah," }, { "speaker": "stephan", "time": "59:11", "start": 3551.05, "text": "I, I" }, { "speaker": "federico_tenga", "time": "59:11", "start": 3551.13, "text": "don't think tokens-" }, { "speaker": "stephan", "time": "59:12", "start": 3552.15, "text": "So summarizing the point then is it's no different to Bitcoin today, basically. It's not, it's not creating an additional incentive, other than what already exists if we were transacting a large value in Bitcoin today, that hypothetically, if somebody were to try to do a deep reorganization, etcetera. Right?" }, { "speaker": "federico_tenga", "time": "59:31", "start": 3571.44, "text": "Yeah, because it goes down to the fact that basically, Bitcoin, the fee that miner has not to, do a reorg or not to, like, do sensor transaction or whatever is the fee that you're paying, but the fee is not proportional to the amount you're moving. So this is true for Bitcoin transaction, this is true for like token transactions. Yeah. So this is why, like, yeah, miners can have an incentive to be bright, higher than the fee that they are receiving not to be bright." }, { "speaker": "stephan", "time": "59:58", "start": 3598.32, "text": "Yeah. Okay. So, yeah, I think Because we spoke about a lot of stuff today, let me try to-- let me try to give the, the, the poor man's summary, like the one minute or two minute summary. So RGB, we can think of it like this asset issuance protocol that works with Bitcoin and, what we can do is issue new assets, transfer those assets around to each other with privacy and scalability in mind. There are different wallets and different businesses in this ecosystem and a foundation, and so we can use RGB to do things like stable- Stablecoins or potentially collectibles or potentially equity, even like securities, and the idea is that we're starting mostly on chain, but there is some on-chain scalability in terms of one Bitcoin transaction on chain can represent many, many, many actual RGB asset transfers in that sense, and the idea is that eventually this could move into Lightning or something like Lightning as well, with the aim to provide that additional functionality for users out there who want, let's say, stableco- Coins or other things. Would you say that's a pretty good two-minute summary or how else would you change it?" }, { "speaker": "federico_tenga", "time": "01:01:05", "start": 3665.04, "text": "Oh yeah, yeah, absolutely. Yeah, maybe yeah, something that, like I want to specify about the Lightning is that, yeah, like to work, at the Bitcoin Lightning, you need to have, asset-specific channels between people. You can't just have like a RGB generic channel or like, any Lightning channel. And, so the consequence of this is that it will likely work only for liquid or very popular assets. So, so the, the, the asset that only like, fifty people are using to, to be viable to move on Lightning Network. I mean, you can still create an, kind of a Lightning Network, which is an open spoke model, but yeah, there are three dots like li- Lightning is a technology that is based on liquidity and fungibility, and so you need the asset to be liquid and, and fungible. So realistically, Stepl Coin may achieve that, other very popular assets may achieve that, but for example, NFTs will never achieve it because they just don't have the And like, small, niche asset, we, we never achieve. So this trade-off that we need to be aware of, this is valid for RGB as for Taro, as for anyone else building on that." }, { "speaker": "stephan", "time": "01:02:11", "start": 3731.93, "text": "Yeah. Okay, great. So, final question then, if what do you want people to do? What are you looking for in terms of people playing around, developer contribution? What are you mainly looking for, and just your final comment for listeners?" }, { "speaker": "federico_tenga", "time": "01:02:23", "start": 3743.05, "text": "Yeah, so like, all kind of stuff. So like, if you are interested" }, { "speaker": "federico_tenga", "time": "01:02:28", "start": 3748.58, "text": "in And download our is, play with it and, get, like provide us some feedbacks. There is a Telegram chat that is linked in the app itself that where you, you can send your feedbacks. That, those are already like, very useful. you can, like, learn more about RGB, like, to, to get more knowledge. For that, I, there is a list of resources I'm creating, and you can find it under the website rgb dot info. There is a list of articles and, resources that, that with different level of, technical and, competence required to, to understand them, that, yeah, you, you can have a look at them, a, a look at. Then, yeah, if you are a developer, like if you want to maybe build an application on top of RGB, you can have a look at RGB Lib, which is, yeah, this library that lets you start working on RGB without having to fully understand all the technical details. Well, if you want to, more interested to To contribute at the protocol level or to understand the protocol level better, you can, there is the GitHub of, of like RGB node, and, I mean, in the RGB info website, you also find everything linked. But yeah, you can go to, to, to have a look, more a, about the, the, the implementation in the protocol actually works." }, { "speaker": "stephan", "time": "01:03:43", "start": 3823.69, "text": "Fantastic. Well, listeners, I'll put all the links in the show notes. And Federico, thank you for joining me. Thank you for the invitation. So I hope you enjoyed the Protocols such as RGB and assets on Bitcoin, is that a good thing or is it a bad thing? Let me know your thoughts. And of course, if you're enjoying the show, share it with your family and friends. Get the show notes at stephanlivera dot com slash four three nine. I'll see you in the citadels." } ] }