{ "episodeId": "SLP581", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "saifedean": { "name": "Saifedean", "role": "guest", "tag": "SAIFEDEAN" }, "calvin": { "name": "Calvin", "role": "guest", "tag": "CALVIN" }, "guest_3": { "name": "Guest 3", "role": "guest", "tag": "GUEST" }, "guest_4": { "name": "Guest 4", "role": "guest", "tag": "GUEST" }, "guest_5": { "name": "Guest 5", "role": "guest", "tag": "GUEST" }, "guest_6": { "name": "Guest 6", "role": "guest", "tag": "GUEST" } }, "segments": [ { "speaker": "stephan", "time": "00:13", "start": 12.63, "text": "Okay, guys, I'm here with Calvin Kim from-- We're here at Bitcoin Seoul 2024. Calvin's actually one of the organizers of this conference. so yeah, let's chat a little bit about it. What, what are your thoughts on how it's gone so far? And, you know, what's your first, you know, initial reaction?" }, { "speaker": "saifedean", "time": "00:25", "start": 25.38, "text": "so for me, it was, I did a lot of the initial planning where my role was It's mostly like contacting, like, like, speakers from abroad and like sponsors from abroad. And so for myself, it's just a lot of communications. I, I wasn't really involved in operations, so like those guys are dying. And so, it's, like, yeah, I think they did a really good job, and, I'm having fun here." }, { "speaker": "stephan", "time": "00:48", "start": 48.26, "text": "Great. And, what, what do you think it means for the scene here in Korea? Is there gonna be more of a, you know, Bitcoin message as opposed to a shitcoin or crypto message?" }, { "speaker": "saifedean", "time": "00:56", "start": 55.5, "text": "That's what we're hoping, you know? And like, like people, there, there aren't any Bitcoin conferences here in general, and so, like, there's a lot of like blockchain, like, like, like, and, and what, what my hope was that we could get, people together here and we could make new connections, and so, like, we'll get To be like, just like product, like I want people to connect, like locals with locals, as well as like locals with the visitors. And so hoping to get some, you know, network effects going there." }, { "speaker": "stephan", "time": "01:29", "start": 88.56, "text": "Great. And you are also the, lead now of UTXO. So I know there is a, you, you've just recently put out a UTXO D. So, let's, I guess, again, we'll take a step back, we'll try to make it accessible. So the idea, the point of UTXO is that you can" }, { "speaker": "stephan", "time": "01:47", "start": 106.89, "text": "Download requirement. can you just maybe explain that for, you know, to make it accessible for people, what is UTXO? Right," }, { "speaker": "saifedean", "time": "01:53", "start": 113.08, "text": "UTXO is just, a collection of Merkle trees. It's just like a fancy collection of Merkle trees. And what it means for the end user is that your node is smaller. And one of the features that we could have because the node is smaller is that you could sync up immediately when you d-have the, have download the binary. And so for the end user, what this means is that, you know," }, { "speaker": "saifedean", "time": "02:17", "start": 137.15, "text": "And it has a full node included in it, and so you're validating blocks, you're validating transactions. So it'll be easier to have, more like, a trustless system without the current, the UX burden." }, { "speaker": "stephan", "time": "02:31", "start": 150.52, "text": "Yeah. And so let's say the user, like hypothetically in the future, is using some kind of UTXO-based wallet And they use this to quickly sync up. Do they then have to also download, you know, new blocks to stay in sync with the chain, or is it like downloading a new UTXO proof?" }, { "speaker": "saifedean", "time": "02:46", "start": 166.17, "text": "so yeah, they would also have to download the, the block as well, and so because they'd be, fully validating everything, but then they would also be downloading the proof as well. And so it'd be downloading the block and the proof." }, { "speaker": "stephan", "time": "02:58", "start": 178.22, "text": "Okay. And so then, do you see that making it viable for like a mobile phone or maybe for like a desktop computer," }, { "speaker": "stephan", "time": "03:06", "start": 186.41, "text": "Main use going to be." }, { "speaker": "saifedean", "time": "03:08", "start": 187.57, "text": "So yeah, I, I do see that as like, as a bottleneck for, for people in some countries. but really, like for open source software, like you build it for yourself and, and you hope that, other people also get value out of it. And so for myself, I live in South Korea, and, we get gigabit up and downs on the subway, so I think, I think the people here are really gonna love it." }, { "speaker": "stephan", "time": "03:29", "start": 208.9, "text": "Gotcha. And so now, you recently released UTXO-D, so" }, { "speaker": "saifedean", "time": "03:37", "start": 216.87, "text": "That has, the UTXO accumulators built in, and so it supports, like every, every single operation that needs to be supported, it supports every single feature, and so it's just a feature-complete, full node implementation with UTXO accumulators." }, { "speaker": "stephan", "time": "03:52", "start": 231.5, "text": "Great. And so, that is also with BTC-D. So can you explain a little bit about, you know, using BTC-D?" }, { "speaker": "saifedean", "time": "03:58", "start": 237.84, "text": "Right. And so, like for most people when they're using Bitcoin or when they're using-- running a node, they'll have, they'll probably use Bitcoin Original client that Satoshi wrote, that's, continuously being developed. And so, like, Bitcoin itself is just a protocol, it's just an idea, and so doesn't need to be Satoshi's client. And so BTC is originally authored by, a group of other guys, and it was completely, re-implementation of the Bitcoin protocol in a language called Go. Bitcoin Core is in C++, BTC is in Go. And, one of the other things was, when we first got started, Tad Who, who originally started the UTXO, they wrote the paper, had the first, code base out there. that was all in Go, and so it made sense to, also use, an implementation of Bitcoin that was in Go. Gotcha." }, { "speaker": "stephan", "time": "04:49", "start": 289.3, "text": "Yeah. So do you see it then that people might- As an example, with, you know, let's say the umbrels and the rustpiblitzes of the world, the, you know, these node packages, that they might also integrate some form of UTXO to quickly onboard the user." }, { "speaker": "saifedean", "time": "05:04", "start": 304.33, "text": "that's what we're hoping for, and, I've, I've not had the chance to talk to them as, as much as I should be. And so, yeah, in the coming months, I'll be trying to talk to more wallets, more, more, more, nodes in the box A couple of gotcha." }, { "speaker": "stephan", "time": "05:19", "start": 318.96, "text": "Yeah, and so also the other interesting thing is you've mentioned, it would be a very small download requirement to just get started. Could you explain a little bit about how that works? Oh," }, { "speaker": "saifedean", "time": "05:27", "start": 326.93, "text": "right. And so, those of you that are familiar with something like a ZOOM UTXO, that means that, at a certain block, you have like the hash commitment of the UTXO set. And so what that means is that, you could start validating the, the next block from then on. So why can Block eight hundred thousand. That means because you don't have the UTXO set at block, seven nine nine nine nine nine, you can't validate block eight hundred thousand. And so if we just provide the UTXO set at that height, you can validate the block immediately after that. And so with UTXO, UTXO is just another way to represent the UTXO set, and it, we can represent them very compactly. And so, with, with something like UTXO, you can have the entire UTXO set represented when you download the binary," }, { "speaker": "stephan", "time": "06:20", "start": 380.48, "text": "Great. Well, I'll put all the links in the show notes, guys. Check out UtriXOD and, Calvin, thanks for joining me. All" }, { "speaker": "saifedean", "time": "06:25", "start": 385.26, "text": "right, no, thanks for having me." }, { "speaker": "stephan", "time": "06:27", "start": 386.63, "text": "Hi, everyone. We're back at Bitcoin Seoul 2024. I'm here with Gloria Zhou. She is a Bitcoin Core maintainer, one of a few, not the only one, and she's also at Brink or Brink Grantee. Yeah. and Gloria, you focus on the mempool, so I know that's, that's your specialty, I know there've been some updates on the what was called V3, but is also now called Truck or T R U C. So can you just explain that for us?" }, { "speaker": "calvin", "time": "06:52", "start": 411.76, "text": "Yeah, so I mean, V3 was just an implementation detail. You set your transaction version to three to use it, but topologically restricted until confirmation is a bit more of a descriptive name. So that's the name that I gave it, and now it's also known as Diff four thirty one, which is just more- A couple days" }, { "speaker": "guest_3", "time": "07:08", "start": 427.65, "text": "ago." }, { "speaker": "calvin", "time": "07:08", "start": 428.41, "text": "Yeah. and so it's, it's basically meant to be a way to opt into policies that should, in my opinion Be the default, and it gives you kind of more robust fee bumping, better guarantees. It lets you use zero fee transactions that you can then see PSP, that will now propagate using transaction Package relay, we have one parent, one child package relay. It's a subset of kind of, you know, general any package relay, but it is a very, very useful one. So now, just to clarify what that means, you can have a zero fee pre-signed transaction or any transaction, CPFP'd by a child transaction that pays its fees. We're working on package RBF for those two packages to be able to replace each other, which should be really, really, useful for Lightning. they're currently talking about how to- To upgrade to using trunk transactions, so it's all very exciting. There's kind of this new energy in protocol development, that's come about from, I guess, new bit editors and just I think new energy and a lot of things," }, { "speaker": "stephan", "time": "08:14", "start": 494.5, "text": "yeah. So, so let's just talk a little bit about the implication as you mentioned. So, the implication here is you can opt into this V3, V3 regime or TRUC, T R U C regime, and the idea is that Let's say Lightning protocol guys might, might be interested in this because they can design their channels in a slightly different way and have like a zero fee anchor output, and then now they can, instead of having to attach Sats to that, they can have a zero fee and then bump it later. Is that the-" }, { "speaker": "calvin", "time": "08:39", "start": 519.29, "text": "Yeah, so that would be with ephemeral anchors, but yeah, if you had any anchor, which is, you know, how, how anchor outputs exist today in Lightning, which is just a place for you to be able to add a child to do a CSP, yeah Negotiate fee rates, to put on that commitment transaction and potentially overpay, which is what typically happens. you just need to pay pretty much exactly what you need in order to get your thing confirmed. You can RBF the child, and so- Yeah, it's, I think it should save money, it should make the cost of running those lightning nodes maybe arguably" }, { "speaker": "stephan", "time": "09:14", "start": 554.34, "text": "make it a bit more predictable for the user. Yes," }, { "speaker": "calvin", "time": "09:17", "start": 556.59, "text": "absolutely. Yeah, and, and you won't like have a forced close, because the fee rates went up and, much higher than what you had signed your committed transactions with. Interesting." }, { "speaker": "stephan", "time": "09:26", "start": 566.29, "text": "And then when it comes to like non-lightning uses, would you see uses here for just like standard on-chain uses, like maybe some kind of vault implication or some kind of just general use?" }, { "speaker": "calvin", "time": "09:37", "start": 576.56, "text": "Yes, absolutely. Oh, vaults, espec- Yes, absolutely. so there's a lot of vault designs with or without the kind of covenant pro-so- proposals that people are talking about, and they all kind of rely on, okay, I pre-signed this thing, it's gonna have to have fees added to it for when I broadcast it later. and so yeah, this would be a really good application for that because now you wouldn't have to think about it, you're just like, oh, zero fees, I'll just add the trans-" }, { "speaker": "stephan", "time": "10:03", "start": 602.76, "text": "I'll add the transaction fees when I broadcast Pre- shoot the fee or pre-estimate the fee, and that's hard, obviously, it might be a year in advance, yeah, and now you don't have to, you can kind of take away some of that requirement." }, { "speaker": "calvin", "time": "10:17", "start": 617.13, "text": "Exactly, exactly. So this should be a money saver at, at, at worst, right? Yeah. Right. in a security thing. Yeah. And," }, { "speaker": "stephan", "time": "10:26", "start": 625.65, "text": "and so the part that we got recently is, I guess, like a piece of this overall puzzle, right? Like it's in a specific context of, was it a one input and one output," }, { "speaker": "calvin", "time": "10:33", "start": 633.08, "text": "like That mempool is architected right now and the permissiveness of a lot of policies is pretty free for all. Like originally it was, yeah, you can send, you can spend unconfirmed outputs and attach transactions, and you end up with these, you know, gigantic clusters of transactions, and we have all these heuristics that we use to estimate, like, for example, is this replacement better than the thing that it's replacing? And with kind of further research that Saifedean and Peter and a few others have done, we've discovered that a lot of A lot of the, a lot of the replacements that we do or don't do are the wrong decision because of all these heuristics that we have. and the topology restrictions are way more permissive than what people normally use. normally people are, you know, at most sending a transaction, if it doesn't confirm, they'll replace it or maybe they'll CPFP. Quick" }, { "speaker": "stephan", "time": "11:28", "start": 688.47, "text": "question on that. So are these applying at a transaction level or at an input level or how's it working? It's" }, { "speaker": "calvin", "time": "11:34", "start": 694.48, "text": "at a transaction level. Okay. Well, it's a, it's a topology restriction So like multiple transaction level as well. So, i-in practice for a user it'd be like, \"Oh, you're trying to spend...\" The second transaction in a chain of transactions, yeah, you know what I mean? Like, you had a transaction, maybe you spent the unconfirmed change, and then you're trying to spend it again, yeah," }, { "speaker": "stephan", "time": "11:58", "start": 717.67, "text": "gotcha," }, { "speaker": "calvin", "time": "11:58", "start": 718.27, "text": "in a third transaction, it's like you can't do that. However, the benefits you get are just more robust fee bumping, okay," }, { "speaker": "stephan", "time": "12:05", "start": 724.92, "text": "gotcha," }, { "speaker": "calvin", "time": "12:05", "start": 725.3, "text": "and, and we can do this without cluster mempool already, gotcha, so we have kind of short term and long term. Long term, we're totally revamping mempool to be But you're probably never gonna hit up against the limits, and it's gonna work better." }, { "speaker": "stephan", "time": "12:23", "start": 742.53, "text": "Gotcha. And then, can you explain kind of for, for us ADIQs, what is mempool clustering? What's, what's the point of this?" }, { "speaker": "calvin", "time": "12:29", "start": 748.67, "text": "Yeah, so, it's the long term solution to kind of what I just described, where, you know, the mempool data structure is tracking packages, but it's very limited in what it's doing." }, { "speaker": "stephan", "time": "12:40", "start": 760.2, "text": "Okay." }, { "speaker": "calvin", "time": "12:41", "start": 761.04, "text": "a-and so what we'd like to do is completely restructure that so that, for example when you want to create a block template for the next block that you're gonna mine as a miner, you're gonna have to calculate that on the fly. So you go into your mempool, you grab the highest, you know, by ancestry score, and then you build that over time, and that's a kind of computationally complex thing to do, whereas what we could do is have the entire mempool sorted the entire time. So when a new block comes in, you update it, boom, you have your next block template like that, instead of having to spend Mempools are full and you have a very large one, and it's very, you know, it'll be a lot faster, and that makes all of the algorithms much more efficient and more accurate. So like I said before, when we're calculating replacements, we can very accurately assess, is this a better transaction, incentive compatibility-wise for the miner, that they would mine. and so for users, we're hoping that it'll-- you'll basically see no impact, because again, nobody is really hitting up against the limits. It's just that we need to design These algorithms with a balance, with balance to them. so for you as a user, you're probably seeing no difference, but a lot of things are gonna work better." }, { "speaker": "stephan", "time": "13:57", "start": 837.31, "text": "Okay." }, { "speaker": "calvin", "time": "13:58", "start": 837.97, "text": "and this is a very long term kind of mempool rewrite." }, { "speaker": "stephan", "time": "14:01", "start": 840.98, "text": "Gotcha. Okay, cool. one other thing, I know you're focused on P2P. Yeah. I know in, v27 of Bitcoin Core, we've now got the new v2, P2P layer encryption. I saw it in my terminal. I've seen, I've, I've" }, { "speaker": "calvin", "time": "14:19", "start": 858.97, "text": "So V2 is basically opportunistic encrypted transport. So when you connect to another peer on the network, you're gonna have an encrypted connection instead of all that being in plain text. So it used to be that, basically a observer, like your ISP, could see the messages that were being sent between, between nodes. and that could be a way for people to eavesdrop, and gain kind of insight into, for example, which is the first node that talks about this transaction. and that's one of the many privacy- Improvements that are being worked on in, in the peer-to-peer layer. another one, I guess this isn't twenty-seven, this is like less recent, but for example, now we see more and more nodes that don't connect on port eight three three three. Okay. and which would be in the pre-- in the past a way to detect, like, oh, that's a Bitcoin node. Like, oh, I see a lot of traffic going to this port eight three three three, that's probably a Bitcoin node. and so that gives you away" }, { "speaker": "stephan", "time": "15:19", "start": 919.01, "text": "Let's say. Yeah, exactly. okay, so zooming out of P2P, just like Bitcoin Core in general, what other kind of projects are on, that people should be, you know, aware of?" }, { "speaker": "calvin", "time": "15:30", "start": 930.48, "text": "I would say that- We have a few projects that we're very excited about that maybe again aren't as user-facing, such as the, the wallet migration. So descriptor wallets have been around for years now, and we're still trying to make sure that all those legacy wallets migrate. we're still working on Kernel, but it's becoming more and more mature. Kernel is our way of trying to extract the consensus engine, into its own module so that we can, for example, understand and test consensus better and Potentially create alternative clients, so that it's not all bundled in with like the wallet and the GUI being in the same exact, piece of software as your consensus engine, that modularization, we're doing a lot of fuzzing, a lot of testing, so these are, I think, all kind of maybe not really user-facing things, but silent payments is something that Bitcoin Core, the wallet team is, is working a lot on. That's a pretty exciting way for people to kind of have your cake and eat it too in terms of privacy and Static payment code. cluster mempool is another one. I'm working on various like censorship-resistant transaction relay things, so kind of Like people trying to s-kind of stop packages or transactions from being gossiped between peers. you know, it's, it might be a little too much of a sausage, but, yeah, various small things going around, all around the repo. And, I recently did a series-- okay, here, software. People like to talk about software, right? I re-recently did a series of PR review clubs, for software proposals, including, the sixty-four bit arithmetic, which on top of that would be off amount, in-out amount and, of, and TL, sorry. as well as op cat and there's tx hash, like all those things. we did a series of review clubs for their Inquisition PRs, like right now I think is like a really good testing phase. So Inquisition, sorry, yeah, Inquisition or Signet, now has like CTV, APO, and as well as, you know, the soft forks that may I'm saying this, and it's, it's out there for people to build applications, build wallets, create trust transactions, and, you know, kind of feel out the ergonomics of using each of these, new kind of script, primitives." }, { "speaker": "stephan", "time": "17:53", "start": 1072.99, "text": "Fantastic. Okay, well, yeah, thanks for the update. And, I'll put the links in the show notes. We'll fi-- we'll put the link for the truck, BIP, and, maybe the review club as well. Yeah." }, { "speaker": "calvin", "time": "18:03", "start": 1083.02, "text": "yeah," }, { "speaker": "stephan", "time": "18:05", "start": 1084.64, "text": "thanks for joining me. Hardware security devices such as the Coldcard Mark IV and the new Coldcard Q. Now, we use Bitcoin hardware security devices to keep our keys offline, our private keys offline. Now, the way these work is you can do that setup, write down your twelve or twenty-four words on the, the seed word cards, and keep that secure. Now, you can use this device to interact with the Bitcoin network using software such as Sparrow Wallet, Electrum, or B'ecto Desktop, or Nunchuk, as if you- Examples. Now, you have a range of security features that you can use with these devices, such as passphrase, or you can use seed x or, or my favorite is multi-signature. Now, if you're starting in a basic way, just start with the device and the USB-C cable, plug it directly to the computer and use it that way, and then later improve your setup. But I believe these devices are great at helping secure your coins, especially as you start to migrate up into multi-signature security. But don't be disheartened or- Don't be, scared away. They are accessible, and I think you actually do learn about Bitcoin in the process. So to get yours, go to coinkite dot com, use code livera to get a discount on your cold card. This show also brought to you by mempool dot space, the leading Bitcoin and blockchain visualizer. I use it all the time when I'm checking transaction fees and trying to understand what is the state of Bitcoin's mempool. You can search transactions, historical as well as unconfirmed ones, and also see a great way to visualize things across the Lightning Network, Liquid, mining, and so much more. Also, for those of you with an enterprise, they offer a mempool dot space enterprise program. So for those of you as Part of that enterprise program, you might wanna get increased API limits, and you might wanna have increased access to the team in terms of feature requests. You might wanna have special branding in terms of how your custom instance of mempool dot space looks. So to sign up for that, go to mempool dot space slash enterprise. And now back to the show. Alright, we're back at Bitcoin Seoul twenty twenty-four, and I'm here with Laloo, aka Roast Beef, the CTO of Lightning Labs. So, Laloo, I know you guys are just coming Coming out with Taproot asset. So do you wanna just give us a bit of a quick overview what's the latest there?" }, { "speaker": "guest_4", "time": "20:27", "start": 1226.68, "text": "cool, yeah, the latest is, you know, it's been on mainnet, for, you know, probably a week or two now, but like, you know, it was still sort of like a little bit earlier. And I think people were really waiting for is basically, you know, it in channels, which is sort of like one of the unique propositions. And actually in the last like month, we've done like a shoot of, of demos, Different capabilities. I think one thing that was very important is that like we wanted to make sure like, you know, anyone could actually pay the invoice, right? So the invoice are actually fully nominated in Bitcoin, right? So even if someone's receiving Euro or some other stablecoin or USD or whatever else, they're still denominated in Bitcoin, which I think is sort of like an interesting concept people always talk about, like, you know, the medium of exchange, unit of account, you know, kind of like, you know, barriers across. And in this case, you know," }, { "speaker": "guest_4", "time": "21:16", "start": 1276.41, "text": "because the So I'm very excited about that. We definitely have a version on main net, you know, this summer, you know, very soon. We've been some, some code. The team's really working, you know, really hard on this right now. so we're excited to get some stuff out there and just really start to iterate on it." }, { "speaker": "stephan", "time": "21:31", "start": 1291.46, "text": "Okay, yeah. So let me just try and explain my, I'm, I'm an ADIQ, so let me just explain it for the grog brains. So it's like you just pay a normal Lightning invoice, but the other" }, { "speaker": "stephan", "time": "21:52", "start": 1311.63, "text": "Bitcoin, but the idea is, you as a Bitcoin Lightning user don't have to care. The other guy, he can set his own thing, and this is something that, let's say, the merchant as an example, or the exchange or someone, and then they would work with-- In my understanding here, you correct me if I'm getting this wrong, the-- It's like you would have like an LSP who supports Taproot assets as an example, and let's say there's, I don't know, Taproot assets teller, like as an example, and they run-- Sure So who's paying, he doesn't have to care about that, right? Yeah," }, { "speaker": "guest_4", "time": "22:24", "start": 1344.01, "text": "exactly. And the other thing as well is that like, you know, if you don't wanna use this stuff at all, like, you don't have to do anything, right? And so for example, let's say you're a routing network in just like the greater, or sorry, routing node in the greater lightning network itself, maybe one day you're like, \"Oh, I'm having more volume, what's going on? \" Well, you don't really need to care, you can just sort of like Right. and then so the way it works, like you're saying, there's this sort of like, you know, edge nodes that basically help to, you know, do that, you know, that transaction basically across the, the other edges, right? So, you know, and the way it works, so some, one thing people always ask me also is like, you know, they ask like, \"Oh, you know, what about like all the fees, right? What about the, the prices and things like that? Like, you know," }, { "speaker": "guest_4", "time": "23:22", "start": 1402.19, "text": "On lightning, you know, each hop is already adding a little fee. Now in this case, that last hop is also just a fee, basically, right? You know, so, you know, maybe it's like slightly above, like there's like a small spread maybe of the USD, you can see price, liquidity or else, but for your wallet, it's basically just another fee, right? So there's no concern about like synchronizing the rate or anything like that. I think that makes it very easy just to roll out in a decoupled manner, because you only need the edges to update" }, { "speaker": "guest_4", "time": "23:53", "start": 1433.43, "text": "You" }, { "speaker": "stephan", "time": "23:56", "start": 1435.95, "text": "know, a stock lightning network wallet as well, it'll still work like that as well. Yeah Kind of routing to yeah, exactly, and" }, { "speaker": "guest_4", "time": "24:24", "start": 1464.17, "text": "yeah, so now, you know, we're able to like bring them into the ecosystem, right? And the other thing as well is like, you know, once you have sort of like these type of coins issued, you know, on Bitcoin and Taproot as well, like things like swaps will become a lot easier, basically non-custodial, you know, transparent swap, right? So now all of a sudden, they come on board, maybe they have like a, you know, fiat front end, Bitcoin back end, and they're like, Anytime you're talking to people that are maybe doing remittances or other things like that in, you know, other countries, you know, they always talk about the costs basically to get in and out, right? You know, you have all the number of foreign exchange fees, banking stuff, whatever else. But if you can basically onboard someone onto the chain, maybe they're using a slightly different, you know, currency or asset or something like that itself, but then once they're on the chain, it's easy to get Bitcoin and they're in the ecosystem. I view it as a way, basically" }, { "speaker": "guest_4", "time": "25:22", "start": 1521.65, "text": "Twenty percent Bitcoin, eighty percent, you know, fiat, and then I slide it over more. So I think this can basically be a more gradual way of onboarding people into Bitcoin" }, { "speaker": "stephan", "time": "25:27", "start": 1527.4, "text": "generally. I see. Yeah. So I guess the main kind of challenge, the way I'm thinking about it, obviously you're, you know, you're the technical guy, not the regulatory kind of expert or whatever, but I'm curious, does that present more of a challenge at the LSP level, the, stable coin or fiat coin offerer? Like, does it mean they" }, { "speaker": "guest_4", "time": "25:52", "start": 1551.65, "text": "So like, you know, the people that are issuing, you can say that maybe the existing players in the space, right? That are already sort of like-- Already doing this stuff. They're already doing this stuff, they already know what they need to do in different, you know, regions, and also like, this is like their business and they figure that stuff out itself, right? But then, you know, as far as the nodes, once again, the nodes that are doing this, it's a purely optional thing basically, and it'll be sort of like, you know, up to In this direction and, and, you know, Bitcoin in the other direction, now their exposure is slightly different, right? So I think people that are doing this professionally, like, you know, they're market makers, they know how to use things like options and futures to hedge things out as well. I think in the future there'll be other packages for these, you know, maybe people that are doing on a more, less industrial, less, you know, more hobbyist level basically, to have similar sort of hedging structures. For example, you know, just now there was a talk here I'm still net long Bitcoin, right? so I think that's another cool sort of like way we can sort of like expand the role of these individuals, or rather, you know, the opportunities for businesses and entrepreneurs as well to provide those solutions, because, you know, this is something that people know very well how to use options to basically hedge a portfolio and to make sure, you know, they're getting, you know, particular exposure in one direction or another. I think you can apply those techniques, into this domain as well." }, { "speaker": "stephan", "time": "27:14", "start": 1633.81, "text": "Yeah. Right. Okay. yeah It's just out there, right? Yeah. so it's there, and for better or worse, and I, I think the way I'm seeing it is like, I can't hate on stablecoin users if I have a USD bank account. Yeah, yeah. It's kind of, let he who has no USD bank account cast the first stone. That's how I'm seeing it. Buy access, yeah. Yeah. So I, I think it's kind of, even if you don't care about stablecoins yourself, it's gonna be, maybe" }, { "speaker": "guest_4", "time": "27:43", "start": 1663.19, "text": "there's gonna be more Lightning Network users We're gonna be making more money as well, and now you have like a flywheel where maybe now, now they can reinvest more capital in the Lightning Network itself, we'll see more growth in the total capacity and more users, and also now like, you know, anything can plug into this sort of like, you know, currency-agnostic, you know, routing network basically. It's all still denominated in Bitcoin, so I think that also like, you know, adds to network effects as well too, where even though they're not necessarily like, you know, holding it themselves" }, { "speaker": "stephan", "time": "28:22", "start": 1701.65, "text": "Just speaking to more Bitcoin more broadly and Lightning development, I'm curious if you have any view on kind of where the software conversation is at, the scalability, some people are interested in op-cards, some people want APO, L-enhance, there's this new idea of great script restoration. I'm curious if you have, what are you kind of interested in or what's, yeah, what's on your mind" }, { "speaker": "guest_4", "time": "28:38", "start": 1717.8, "text": "there? Yeah, to your question, I, I would say like, I think like, maybe like five or so years ago, I think the, the question or like kind of Me as a, Bitcoin user, I make my address. When I make my address, I have the spending conditions basically, so someone can't force me to accept the covenant. I mean, like, they can force me to try to take my Bitcoin, but that's like a whole other thing, the whole, you know, right-of-way attack basically. But you're not necessarily gonna accidentally accept the covenant and all of a sudden it destroys all your Bitcoin like a virus and all that, right? So I think people got over that. Now I think the discussion is sort" }, { "speaker": "guest_4", "time": "29:13", "start": 1753.29, "text": "of like, okay, well improve decentralization, self custody, you know, privacy and these other, these other aspects as well, and sort of, okay, well, how do we examine these different proposals to sort of like, you know, examine number one, risk, capability, and then also the way they compose the other components as well, too. So, so I think that's definitely just exciting to people moving forward, like, you know, it's a slow process because it's decentralized. There's no one figure that's just saying, \"Hey, this is the, this is the roadmap, that" }, { "speaker": "guest_4", "time": "29:52", "start": 1791.65, "text": "I also want to improve the abilities to custody Bitcoin, right? And so some of these techniques to basically allow, make it like, you know, lower the, the, the custody costs, also make it less operational intensive, do things like multisig as well, too. If we can increase the privacy and scalability as well, given that we're all, we're seeing sort of like, you know, regulatory activity, you know, some of it's indeterminate or whatever else, you know, can we give, you know, users the tools basically to make sure their Bitcoin is secure and then also to use Because like, if you look at the code for it, it's pretty trivial, right? It's sort of like one of the, one of the first, first thing people learn programming is, okay, well, how do you do like string manipulation basically? Because, you know, everything is based on parsing. For example, HTTP, the web, it's all text, right? And I think we also learn with, you know, all these, you know, this new AI stuff, it's all text again, right? So it's a very, you know, powerful This area and like the complexity in that, that one's at least, you know, fairly contained, right? and there's something called, Bitcoin Signet, like Bitcoin Acquisition, basically, where people are starting to enable these things in the wild now, right? So I think this is sort of like a proving period now, it's like, \"Hey, if there's really some, you know, crazy ultra-dos attack or something like that, you people can try it out here and actually start to move forward on, on it itself.\" But, you know, there are a bunch called like ops substring. So let's say you have a string and you only want the first few characters, right? For a parsing, once again. So the question is, okay, well, why that one and not this one, right? It's sort of like, you know, a chicken and the egg thing as far as, okay, well, we've playing favorites or whatever else. You know, great scripturist says, okay, well, hey, let's just do everything. Let's just do all of the prior stuff that we had, things that were in the original codebase" }, { "speaker": "stephan", "time": "31:52", "start": 1911.63, "text": "Do you have any thoughts on how do we make sure that's safe? Because there'll be a lot of users and people out there who are like, \"It sounds good, but how do I make sure it's safe?\"" }, { "speaker": "guest_4", "time": "31:58", "start": 1918.48, "text": "Yeah, yeah, yeah. I think that's the thing, too. It's like, you know, it tries to sort of like, compromise by increasing scope, you know, almost in a sense, and, and maybe that there. But I think, I think people can do things like simulations. I think they can also use sort of like formal methods to sort" }, { "speaker": "guest_4", "time": "32:22", "start": 1941.67, "text": "And can't find a counterexample basically that can still increase confidence. But so I think it's just sort of like, you know, a matter of time and confidence to be increased as well. And obviously that thing is still somewhat young, there's not necessarily like a full bit of everything like that. There's, there's sort of like, there's some code which is really good, and there's also like the talk that he gave as well. But I think generally what I'm excited about is sort of like reinvigorating that excitement amongst developers basically, and then also the recognition from individuals as well Maybe like a rallying cry to move forward to make sure people can custody their own Bitcoin, they have additional privacy solutions, and also we have additional sort of like scalability, you know, tools, because at the end of the day, they all have some trade-offs basically, right? So we don't want maybe, like, you know, can we sort of like compose many of them together, or even just give people o- other options depending on their own, you know, risk profile or use cases also." }, { "speaker": "stephan", "time": "33:10", "start": 1989.9, "text": "Yeah. Yeah, interesting. I think that'll be where the debate is, and I can understand the reason for people who wanna be conservative and say, you know, not so fast. Yeah, yeah. because you" }, { "speaker": "guest_4", "time": "33:20", "start": 1999.83, "text": "said, number one, don't fuck up the money, right? That's number one rule. Any of this stuff, I think people can't forget that basically, because, you know, that, that'll be the disaster case. And like slow is better than fast, and then, you know, things just start to break down basically, and if you-- once you lose confidence as well, too. I think that's the thing where it's like That increases the level of, confidence that you need and also the level of rigor of your engineering practices as well, too. So, it's sort of like getting bigger and bigger and bigger, and I think that can be a challenge as well, because some people feel like, okay, well, you know, because we, because we haven't, we, we haven't done something for a while, maybe like we wanna make up for lost time, right? But then it's like, okay, well, you can do that, but at the same time, let's make sure like we Places with some comments, and that's part of like, you know, basically like the market and decentralization, which is a beautiful thing about Bitcoin, too. Great." }, { "speaker": "stephan", "time": "34:18", "start": 2058.39, "text": "Okay, well, yeah, guys, check out, Lightning Labs. I'll put the links in the show notes. And Laila, thanks for joining me. Cool, yeah, thank you. Hey guys, we're back at Bitcoin Seoul 2024. I'm here with my friend Saifedean Ammous, the author of many books, The Bitcoin Standard, and also of Saifedean dot com. And now, I know you had a, an interesting, so this is your talk at, the Canadian Bitcoin Conference, and also went out as an episode on the podcast. I'll put that in the link. But, basically, you had this idea of basically explaining the central bank more like a private organization. So could you just touch" }, { "speaker": "guest_5", "time": "34:52", "start": 2091.51, "text": "on that Critique of socialism is the idea that socialism fails because of incentives or socialism fails because of size, because of scale. A lot of people think this is the case. A lot of people think central planning is a problem because people don't want to work if they can't get rich. That's, to an extent, a real problem in socialism, but it's not really the economic problem of socialism. First of all, there are effective ways of motivating people other than profit. If you tell them, \"I'm not gonna put you-- if you tell them you'll put them in the The Gulag, they're gonna have a very strong incentive to work. not going to the Gulag is more valuable to people than getting rich, right? So that is a very strong way to solve the, Incentive problem. On the other hand, the scale issue isn't really the problem with central planning. You can't have central planning in a tiny country like Estonia. Socialism fails in Estonia, but you can't have planning for a gigantic corporation that, like Amazon, which has the more employees than Estonia has people and serves, about three hundred million customers around the world, and yet they managed to get the toothpaste out to every one of their customers when they want it within a few hours or a few days. So they clearly know how to plan, they're making a profit that's huge, they employ a half million and a half people, they know what they're doing. So the issue, and this is, this is a misconception of Austrian economics, because the Austrian critique of socialism is independent of the issue of size and independent of the issue of Of incentives, it is specifically about economic calculation. This is the key point. You are unable to have economic calculation in a world in which there is no private property, because under socialism, the government owns all the capital. So therefore, there is no market for capital, there is no possibility for people to perform economic calculation, because there are no prices, because the owner of all capital goods is the same. So to try and simplify it with an example, the, The iron mines and the copper mines and the car factory and the train factory that, use the copper and iron mines are all owned by the same person. So there is no market in copper and iron between the train factory and the car factory, and there's no market between consumers between trains and cars because the government, the central planner decides who gets to drive a car and who gets to get on a train. So every level, the decision is being made top down. At every level, there is no private property. The people are owned by the government, the car factory and the train factory are owned by the government, and the copper and iron mines are owned by the government. So the government can't make a market between itself. You need to have a market, market isn't a pretend play thing. Government can't LARP a market, they can't, and as Mises puts it, they need to have a market. They need to have people who have to make a real, concrete choice between getting on a car and getting on a train, and when you have that The car factory and the train factory can make concrete choices about how much they're willing to pay for the resources, and then the one that uses it most productively gets that. It's a little bit of a long diatribe, but the point I'm trying to get to is ultimately it's an issue of property. So usually Austrians apply this analysis to central banks and say, \"This is why central banking fails, this is why central planning in the capital market fails.\" But I think If we're being really honest, I think this is a misconception, and I think the Austrians might be wrong about this, because the central bank is a private institution. So the marketing for the central bank is that it is a public institution. There's a hilarious page on the Federal Reserve's website where they say, \"Well, who owns the Federal Reserve?\" And it's, and it's these kind of, you know, you're very familiar with the kind of debunking that you see in, the mainstream media outlets that they'll, lay things out and just admit that what you're, that the thing they're, the debunking is true, but then tell you, \"But it's false anyway.\" So they go on about, \"No, no, no, actually nobody owns the Fed, and it's an organization by the government,\" blah, blah, blah. And then they mention that there are the shareholders, and then they Well, if there are dividends, that means there are shareholders, there are shareholders, there are owners. It's private, yeah. It is a private bank. It's got a monopoly from the government and it's-- but it is privately owned. The owners of the Federal Reserve are the constituent banks of the Federal Reserve. It's an oligopoly. And this has been the case since the establishment of the Federal Reserve. So therefore, the owners of the Federal Reserve are able to perform economic calculation because there are resources. Yes, they have a monopoly, and yes, it's not optimal to have a monopoly, obviously, for you and me, but it is optimal for them. Yeah. But monopolies can perform economic calculation if there is private property. Just because the government puts a gun to the head of somebody else and tells them, \"You can't set up a business that competes with this guy,\" doesn't mean that you are Unable to perform economic calculation. You still, as a monopoly, you have resources and you are able to perform economic calculation. And so if you think of it this way, it does make sense that central banking is working exactly as intended, just not for us, just not for you, but it is working for them. But that's the point, you know, a monopoly in a-any context ends up serving its owners at the expense of the customers. Yeah. Every, every single kind of monopoly." }, { "speaker": "stephan", "time": "40:15", "start": 2415.44, "text": "I sort of go back and forth here when I'm thinking about it. I mean, I can agree" }, { "speaker": "stephan", "time": "40:21", "start": 2420.72, "text": "For us, but there are kind of some semblance or, as you said, it's a public entity. They, we talk-- people talk about Federal Reserve, central bank independence, but, and yet the government selects the governor, right? And this kind of Trump or Biden may make overtures about trying to influence the actions of the Federal Reserve. So there's kind of some element there. There's also kind of a propaganda element, like the government sort of propagandizes us, the tax cattle, into holding government bonds. Now, of course, you know, we don't recommend holding government bonds, And so they kind of end up being bag holders because of propaganda, because of coercion. So for you, I guess for you, what you're trying-- I guess you're trying to point to the fact that it's more about the coercive element that people got kind of coercively pushed into this system, like it wasn't chosen by the market obviously." }, { "speaker": "guest_5", "time": "41:08", "start": 2467.6, "text": "Yeah, this is a very important point. I think, the most devastating argument against Keynesian voodoo is that there was never at any point in time some Keynesian scientist who came up and said, \"We have figured out that actually we can By getting off the gold standard. And then they wrote an, a book or, launched a campaign to do this, and then they got, somebody-- They got people to accept it, yeah. They got people to accept it, they voted somebody into office who ran on a platform of, \"We're going to go off the gold standard,\" and people voted for them, and then they went off the gold standard, and they appointed a bunch of Keynesian, pedophiles in charge of the monetary policy instead. That never happened. The pedophiles took over" }, { "speaker": "guest_5", "time": "41:49", "start": 2508.68, "text": "without We're not going off the gold standard. Don't believe the liars who tell you that we are going off the gold standard. Then, okay, we're on the gold standard, but you can't have your gold, because of reasons. And only central banks can redeem it. Yeah, well, you know, with this world war and it's complicated, and so we're still on the gold standard. Don't believe them. We will never go off the gold standard, but you just can't have your gold for a bit. And then, oh, well, actually, we're going to Oh, wait, actually, we've just discovered that it's better that we don't go on the gold standard. So they went off the gold standard in nineteen fourteen and nineteen fifteen, and that continued, and, and Keynes wrote his moronic book in nineteen thirty-six. That was twenty-one years later. So it was a justification for something that had already happened. They'd already been off the gold standard. He just came up with the twenty-one year late justification for it. So there is no moral or legal or intellectual case to be made. For this being anything other than criminal theft, it has been forced on people, and it was a lie. It was, it was lying from day one. They lied about it. And in the Fiat Center, I discussed the auction of the bonds to finance the World War One. They failed to sell two thirds of those bonds, and what the Bank of England did was they bought that bonds, they bought these bonds themselves, they put them under the name of, two individuals who worked for the Bank of England. They bought it with a credit line from the Bank of England, and that's how the Bank of England financed the war, and that's why they had to go off the gold standard because they'd made so much money that they couldn't redeem, all of the liabilities that they'd made because they printed a ton of money in order to buy the equ- equity. So I think ultimately the whole thing is resting on lies and coercion. But I think it's counterproductive perhaps to think of it as a government bureaucracy that is failing because it is central planning, because all of these, they're just like these, Soviet bureaucrats who are trying to make the steel factory work, but they are unable to make it work, and they don't know why they end up with a lot of rusting steel factory. That's not the case here. We don't have rusting steel factories, we have very successful debt slave production factories that are making people into debt slaves for the owners of the banking cartel. It's working very well for the banking cartel. They keep getting richer, they keep getting better off. And I think if you look at where they stand with relation to the, policies of the Federal Reserve, it's been massively successful. When there's inflation, they are-- when, when monetary policy is loose, they are the largest creditors, and so they are getting the, their di- their liabilities devalued, so they're better off. The largest creditors are the banks, and so the banks are- Better off from the devaluation of the money. Then when there's an increase in interest rates, when monetary policy becomes less accommodative, well, then they are still able to borrow at the lowest rates because they are the banks, they have the primary dealer relationship with the Federal Reserve. And they, they are doing much better than everybody else. Everybody else starts getting liquidated and businesses start going out of business, and people need to sell their assets at a massive discount, and who is best placed to be able to capitalize on that? People who are able to get the lowest interest rate. And so even though interest rates rise, they rise for everybody, and so the people who get the lowest interest rate still get the lowest interest rate. And so these owners of the bank end up working, end up succeeding, end up benefiting enormously from this. Rug pull of raising interest rates because everybody gets liquidated and then they get to decide who gets to keep their business, who gets bailed out, who gets, who has to get liquidated, who gets to sleep on the street, who gets to keep their house. And so, it allows them obviously to buy all these- important asset at a discount, but also it allows them an enormous amount of political power, and you can see this becoming more and more, obvious. Basically, nobody who is going to be disobedient to the regime is allowed to, yeah, continue to operate. If, if your business is in trouble and you're obedient to the regime, you get a bailout. If your business isn't in trouble and you're not disobedient, yeah You don't get a bailout, so I think it's a sweet deal. my actionable advice for you is to be born to a family that, owns a central bank. If you didn't do that, better luck next time, I guess. Better get some Bitcoin. Yeah, better hope, hopefully there's reincarnation, maybe you get another go at this." }, { "speaker": "stephan", "time": "46:29", "start": 2788.89, "text": "Well, I mean, yeah, so it's an interesting, let's say, reinterpretation or reframing of the view. I think, to your point, it is very political in the sense that it depends who gets Crash, the government chooses who gets, this bank gets a bailout, that one doesn't, or this airline gets a bailout, American Airlines gets a bailout, that other one doesn't, you know? So there's, there's an element in which it's political control, it's government seizing and commandeering the resources of society, and so, I mean, I guess, you know, you bring all that together, we're, we're kind of our tax cattle or we're debt slaves, but really it all comes back to Bitcoin, doesn't it? Right? Like this is actually the" }, { "speaker": "guest_5", "time": "47:08", "start": 2828.05, "text": "Ab- absolutely. Ultimately, the only way to get out of this is Bitcoin. I mean, that's really the actionable advice out of it. The, the, the fiat is a rigged game, and I think, trying to think from the perspective of this being, About bureaucrats who are unable to succeed in their job is very counterproductive. It's, you're, you're playing into their frame, you are giving them your energy, you're giving them your money, you are holding your money into the system. The more emotionally invested you are, the more financially invested you must be, and that's the wrong thing. You just need to- opt out, and the way to opt out is Bitcoin, and not just opt out with Bitcoin, you beat them, because I think this is really the key thing about why Bitcoin eventually wins in the long run, because I honestly think holding Bitcoin is going to be far more profitable than running a central banking capital, debt slavery system, which is what we have right now. So yeah, you can make a lot of money from that, but I still think holding Bitcoin is probably better. So I think, Bitcoiners will likely outperform, The fiat mafia, and hopefully, I think, over time, that's what's going to kill it." }, { "speaker": "stephan", "time": "48:16", "start": 2896.46, "text": "Fantastic. Well, that's great. Everyone check out Saifedean's work. He's over at saifedean dot com. Check out his books, The Bitcoin Standard, The Fiat Standard, and Principles of Economics. Saif, thank you for joining me." }, { "speaker": "guest_5", "time": "48:25", "start": 2904.71, "text": "Cheers, man. Thanks a lot. Take care." }, { "speaker": "stephan", "time": "48:26", "start": 2906.39, "text": "Back to the show in a moment. This show also brought to you by Nomad Capitalist. Nomad Capitalist is a leading provider in terms of offshore tax and lifestyle strategy" }, { "speaker": "stephan", "time": "48:40", "start": 2919.62, "text": "Go overseas and legally lower your taxes. As many of you know, I grew up in Australia, but I left. I was sick of it in terms of the taxes and the COVID tyranny and all these other things. And so that's why I left, and now I live in Dubai. But that's not necessarily the place for you. You have to think exactly what works for you, for your family, for your business. And Nomad Capitalists have worked across dozens of different countries. They've helped people get passports, residences, bank accounts, and all kinds of other things. And importantly, it's not And it may be also about making the pieces fit together in terms of how your business fits with your family and you as an individual. Nomad Capitalists have helped many, many people in terms of going overseas, and if you're interested, go to nomadcapitalist dot com slash apply. This is applicable for people with a net worth above one million US dollars. That's nomadcapitalist dot com slash apply. The lead sponsor of this show is Swann dot com, and Swann has a mission to onboard millions of people into Bitcoin. I also work at Swan, helping on some educational content for the team. Now, the team have also put out a new version of the Swan Bitcoin application, which is available on your smartphone, whether it's Apple or Android. Now, this app has a really fast onboarding experience. It's now just a few minutes to go from zero to Bitcoin. So if you are standing there with your family or friends and you might have been having trouble trying to get them on boarded, well, try this now. Recommend Swan Bitcoin, and you can do this while you're standing there. Standing next to them, they can click through and most of them will be able to set up and do this in just a few minutes. Also, the team at Swan have rolled out a new promotion, there are zero fees on your first ten thousand dollars of Bitcoin buys, so this is a great way to go from zero to Bitcoin and in a guided and managed way. So reminder, go to your app store or Play Store and search \"Swan Bitcoin\" to get onboarded with Bitcoin today. And now back to the show. Hi everyone, we're here at Bitcoin Seoul 2024. I'm here with Obi from Fedi. So, let's chat a little bit about what's happening, what's the latest, in terms of Fedi, what's happening?" }, { "speaker": "guest_6", "time": "50:47", "start": 3046.87, "text": "Well, we just, y-just yesterday released a major release of Fedi that we've been working on behind the scenes for several months. So that's really big for us. It has a lot of features. One of the biggest is that we've now got a global chat. So instead of different chats for different communities, it Intergalactic chat. So that sort of completes the vision of this being a community super app, 'cause you can now chat with anyone, anywhere, within your community or others, and you can access multiple federations to help custody your money, and you have all the features of Fedimals all in one place. So it's, it's this final community run and operated super app. So we're really excited about that." }, { "speaker": "stephan", "time": "51:30", "start": 3090.34, "text": "And, let's chat a little bit about your, I guess, who do you see as the main users or groups? So we'll go Going to" }, { "speaker": "guest_6", "time": "51:38", "start": 3098.23, "text": "adopt this. So there's Feddy Mints and then there's Feddy. For Feddy as a company, we're very focused on market product fit. So we have really strong relationships within the humanitarian and human rights defender communities and also in Bitcoin communities in the global south. And so the number of communities we support in combination is- Multiple billions. And so that's the market we are focused on, but they're the world's most disempowered. We say instead of focusing on the world's wealthy, which is great, there's no problem with that, we focus on the world's worthy." }, { "speaker": "stephan", "time": "52:09", "start": 3129.27, "text": "when it comes to Feddy, so my understanding is there's this concept of guardians, and they are the, let's say, the key holders, but you also are connected to a lightning gateway or multiple lightning gateways, and that's how the eCash is kind of traveling on the lightning network. So could you just explain a bit about what responsibilities the guardians have and how many guardians you see being involved with a typical Feddy instance?" }, { "speaker": "guest_6", "time": "52:31", "start": 3150.91, "text": "So you can have as few as four. I mean, it is possible to run a single guardian federation, but then it's not a federation anymore. Yeah. So where it starts becoming useful is at four, and you can be as, be more. We've seen people have experiments up to forty of these. So that's more than twice as many as you have in the Liquid Federation, for example, at that stage. and the responsibility is to run, to download the Fedimint software and run it on a server. and running the FedMeant software is actually relatively simple. We've-- there are some partnerships that we, that we have with companies that make it very easy for you to set up and run your own federation, and then they will provide you this point-and-click interface to set up and run your own federation, and that can take as little as ten minutes. But once it's running, you don't need to run it in the same way you run a Bitcoin node. It just needs to-- you need to keep it fed and watered with internet and electricity. Yeah. If it goes wrong, you" }, { "speaker": "stephan", "time": "53:28", "start": 3208.27, "text": "And then in terms of the role that Guardian plays, like they are also the person that somebody who's lost their wallet or their phone, they come to them to get recovery, like it's, it's a recovery function as well, right? Like what kind of roles are they playing in the community? Again," }, { "speaker": "guest_6", "time": "53:42", "start": 3221.79, "text": "it depends on the community. Yeah. So if it's a very large community, they, they probably won't provide that service. And but then people can still, individually, just like with a Bitcoin wallet, you can, once you have your eCash, it's on your phone, so you can back that up With twelve words and recover yourself without any involvement with the guardians, and, and some guardians may not want to do that. But if it's a small community, if it's your family or friends or, a football club or something like that, where people sort of know people by, know each other by eye and so on, they can use, KY, KY, KYG, know your guardian. Yeah. And so, and you, it's basically knowing your friend, knowing your family, and you can use that to recover. cover, and that provides you a really powerful addition in terms of how to backup and recover your keys. Yeah." }, { "speaker": "stephan", "time": "54:34", "start": 3274.5, "text": "And so I guess everything has different trade-offs and there's different trust models and so on, but can you offer people just a rough idea what kind of fees should they expect? Are it's like zero holding cost that you're paying on the fee out or like what kind of fees would the end user pay?" }, { "speaker": "guest_6", "time": "54:49", "start": 3288.67, "text": "So the end user will pay a fraction of a percentage or free for transactions within a federation. And so you should think about that like within your community, like within your town. Moving around on streets and so on, you can go by bicycle and by foot, so it's basically free or, or very low cost. but then if you want to travel between towns and between cities, between countries, you have to start using planes and trains and, and automobiles, and the, the cost could be higher. So that's, that's when you're starting to use the Lightning Network. And so if you're sending money outside of the federation to buy something, for example, on a site like Bitrefill or to, or to send a zap to someone in Nosta You can do that from within your federation, but you'll pay the lightning fee, and that will be, you know, the, the classic lightning fee cost. But if you're buying something within the federation with eCash, then it could be anywhere from zero to a fraction of the cost of lightning." }, { "speaker": "stephan", "time": "55:44", "start": 3343.69, "text": "Right. And as we're saying, the, the idea of lightning is kind of the connecting kind of, it's the glue everyone's gonna use that." }, { "speaker": "guest_6", "time": "55:50", "start": 3349.87, "text": "It's the motorways connecting to the towns, and you can think about the towns and cities as, as the federations or the fediments, and The glue that connects them together." }, { "speaker": "stephan", "time": "56:00", "start": 3360.24, "text": "Yeah. Okay. And so, I, I guess the other aspect is, I know there's different modules that can be part of a Fedex instance. Yeah. And so one example might be for people who really want, you know, stablecoin, or I prefer to call it fiat coin, or maybe stable value, I understand that's something you're looking at also as maybe one of the modules." }, { "speaker": "guest_6", "time": "56:17", "start": 3377.35, "text": "Yeah. So, well, you t-talked about the backup, so social backup and recovery is actually- Fedimint module that was added beyond the basic Fedimint protocol, yeah, we fairly added that module to allow, communities to back up, keys or other data in future on behalf of community members and then use, guardians to collectively, if a majority of them say this is the right person to, to allow them to get that data back, the obvious use case would be for keys. another module that has been discussed is a Fedimint- federated mining pool where you can have a mining pool using any protocol you want, for example, Stratum v2, but no single person running it, you can run that. So federated, federated mints are actually a way of running any application in a federated manner, if you think it's useful to run it in a federated manner. Another thing could be a federated stable value asset, and there was a coding hackathon competition done a year and a half ago, in fact, actually, more than that, it was in twenty twenty-two. That we held, and one of the winners for that, the, the winner for that created an idea of a, a, a contract for difference, a stable value, stabilized Bitcoin effectively. And the-- and so we've taken that on and, and improved the product and, and that's being trialed by certain communities. And so that's another example. But people are working on federated escrow services, so dispute resolution, but instead of having one escrow, One person in the middle, one sort of adjudicator or a judge to determine who's, who's doing right or wrong, you can have a, you can have a group of experts on the subject who provide a federated judgment and the majority decision, which is, which again, in, in legal disputes, you might prefer multiple people deciding, not just one person who could be bribed by one party or another. Yeah. And, and the list goes on and on. Yeah." }, { "speaker": "stephan", "time": "58:19", "start": 3498.89, "text": "Okay. And let's chat a little bit about the trust model. Now, of course, it is kind of, you You know, if you can afford to go on chain, not your keys, not your coins, all that. Yes. But, do you wanna just explain a little bit about, you know, how you're thinking about, you know, the risk of getting robbed, right? Like, could, you know, let's say a quorum of the guardians run away with the money? Like, how are you thinking about that kind of risk and, I guess, communicating that to users?" }, { "speaker": "guest_6", "time": "58:41", "start": 3521.1, "text": "So, yeah, this is a really interesting one. We've been-- So I ran an" }, { "speaker": "guest_6", "time": "58:54", "start": 3534.27, "text": "Starting to, to finishing. So, proof of reserves is something that Nick Carter wrote about it a lot, et cetera. it's something that's been near and dear to my heart. so if you look at Fedimint, the actual protocol, there's a really good website if you wanna learn more about Fedimint, which is a protocol that Feddy relies upon, plus Bitcoin, plus Lightning, plus Matrix now, and also Nosta, where you rely on all these freedom technologies. there's a really good site which goes through- And explains how it works, but also talks about all the trade-offs and all the risks, and one of them is this risk you mentioned. And so we wrote about the ability to do effectively automated bank runs, proof of reserve type actions, I think about nearly two years ago. So, we-- it's all public and, and, and that's something that is complicated to do, but we know it's possible to do. So then in time, the ultimate best way to protect yourself from any of these risks is one- To have good trust with the people that you connect to, this is why we prefer the federated approach and we prefer focusing on communities of trust versus, because then your requirement, for trust is, is lower if you know the people that are part of the community. There's a social cost for them to rug pull you, and also they can't rug pull you individually. the privacy properties mean they have to rug pull everybody. So if you're in a community and there's four guardians and a community of ten thousand people, they have to rug pull all ten thousand. Then, you know, they, they, they have, they can, they will take a lot of risk, whereas if they're, I would like to say a curly head guy in the Bahamas who's a stranger, you're gonna end, you know, you're gonna end up having a bad day potentially. So that is actually a powerful mechanism. The second is the privacy, requirement requires you to write pull everybody or no one. and then third, ultimately, you can, you leave the federation, and that's the only way you know for sure. And so you can imagine in time, tools could be implemented to help you automatically, on mass, you're-- you could be part of multiple federations, and at some point in time, you can, you can coordinate and everybody on mass leaves. And because the guardians won't know when that event will necessarily happen it also acts as a risk. They, they won't know-- there's a risk for them to try and defractionalize, yeah, because at any moment, it's like the Damocles sword of this mass migration could happen." }, { "speaker": "stephan", "time": "01:01:22", "start": 3682.89, "text": "And also interesting, I'm curious to get your thoughts on this also, is that the lightning gateways who connect to the FETI, they are also placing a certain level of trust in the, eCash tokens of that FETI. So they need a-- they, those lightning gateway guys need to find a way to get" }, { "speaker": "guest_6", "time": "01:01:37", "start": 3697.56, "text": "trust in the It's not trustless, it's trust reduced, but it's nowhere near trust minimized to the level of self custody. So if you can do that, you should do that. But you have to compare it. We like to compare it more against using a centralized custodial solution as a-- and this is sort of, this sort of journey from, from the most trusted to the least trusted, and we're on, on that, on that journey. However, it's actually quite interesting because then trust acts like a, a limit on how large these things can get And it naturally decentralizes it so that you never see these becoming these behemoths with hundreds of millions of users that is the potential for something like a Coinbase to become. And you'll, you can see this future where there will be, as they get above a certain size, they naturally split off into multiple, smaller communities and there'll be hundred-- there'll be, right now there are dozens, and in future there will be hundreds, and we can see a vis- vision eventually in three, four years' time Where there are hundreds of thousands of federations, where people are holding balances across them, and you have this nice simple contiguous experience, but actually your money is being decentralized." }, { "speaker": "stephan", "time": "01:02:54", "start": 3774.01, "text": "Yeah. Yeah. So fascinating stuff. So guys, check out, Fedi. I'll put the links in the show notes and, Obi, thanks for joining me." }, { "speaker": "guest_6", "time": "01:03:00", "start": 3780.24, "text": "Thank you very much." }, { "speaker": "stephan", "time": "01:03:01", "start": 3781.86, "text": "Hey guys, so we're here at Bitcoin Seoul 2024. I'm here with my friend Jimmy Song. so Jimmy, let's chat a little bit. What do you think about the conference so far? What are your thoughts on Bitcoin Seoul? Oh," }, { "speaker": "guest_3", "time": "01:03:12", "start": 3792.85, "text": "I, I mean, this is sort of like a major milestone for the people of Korea, right? Because, yeah, it, they've been shi-quiet for so long, and this is like the first signs of life of the real narrative coming through, yeah, savings. and, you know, East" }, { "speaker": "guest_3", "time": "01:03:30", "start": 3810.98, "text": "Heavy sort of culture, and they, they want to save, they just don't have a very good vehicle. So yeah, I think when they get it, this will, this will blow up, and you'll, you'll see a lot of people getting into it. I, it's going to be a major, major growth area, in the street," }, { "speaker": "stephan", "time": "01:03:45", "start": 3825.41, "text": "so yeah. So, are there any big developments you see in this, you know, in the Korean market or anything you've kind of heard from people?" }, { "speaker": "guest_3", "time": "01:03:51", "start": 3831.55, "text": "I, I mean, it's, it's sort of still emerging from" }, { "speaker": "guest_3", "time": "01:04:00", "start": 3840.94, "text": "Of, you know, all that they experienced, and they, I, hopefully learned their lesson, and it's, it's starting to recover from that, and this is part of that sort of revival. So, yeah. I, I, now specific stuff, I, I haven't heard yet, but, you know, we'll, we'll see. There, there's plenty of potential." }, { "speaker": "stephan", "time": "01:04:18", "start": 3858.39, "text": "any thoughts like if you're just kind of thinking about Bitcoin more broadly, technical developments, what are you kind of, what," }, { "speaker": "guest_3", "time": "01:04:24", "start": 3864.99, "text": "what's interesting for you in the technical world of Bitcoin? Yeah Really interesting blog post about like a trusted setup, and then you can have any confidence you want. and I, I think it takes some of the sim-similar ideas from like BitVM and stuff like that. But that, that to me is the most interesting is, you know, if you do have something like BitVM, I, I think something that a lot of people don't realize is that you have a lot of privacy around the smart contract itself, 'cause most of it is hidden, and you don't know what the executing program is. As far as you know, it's What's going on. So, so that, that, that's the main, main, sort of like direction of, okay, what, what can we do with this thing? 'Cause you can perform kind of almost any arbitrary program execution and prove that it executed correctly or didn't execute correctly. so that, that's the main thing that, that interests me right now. Like, it's very early obviously, and it's, it's going to be a few years before we even really realize what it's for. but for the long term health of Bitcoin, I see this as one of the major sort of like benefits or se- you know, security things or something like that that, that will prove itself over time. Yeah." }, { "speaker": "stephan", "time": "01:05:42", "start": 3942.68, "text": "Great. what about, savings culture here in Korea? That's something I think you were, you were talking on earlier. Could you elaborate a bit on savings culture here and how that could tie in with Bitcoin?" }, { "speaker": "guest_3", "time": "01:05:53", "start": 3953.19, "text": "Yeah. so I, I grew up here the first year, years of my life, and, so I, I have some familiarit With that, and this isn't necessarily something Western audiences would know, but, you know, Koreans are hugely into savings, even before the advent of banks and stuff. So they, they would have, for example, these things called kid, and they're, they're basically groups of people that contribute some fixed amount of money, like on a monthly basis or something like that, and one person gets it every month, a different person, right? Then you, you do like some sort of round robin or something like that. and that, that's been a part of the Time. And in fact, like my dad always tells me this story about how, he was able to get an engagement ring for my mom 'cause he drew the number one, in, in his thing, and he got the money, now he can afford the ring. And this is sort of like an enforced way of saving without, like, you know, government forcing you to take away some social security part of your check or something like that. It was, it, it was meant to be sort of like a communal thing where now you can have like a down payment on a house because now Although you're, you know, contributing to everybody else. So, you know, that, that's the culture we're talking about where they want to save, right? They want long-term capital formation and they want communal sort of- enforcement on that to, to make more of that happen. the problem is like in a savings based culture with fiat money, you're just stealing from everybody, and that's unfortunately what the government here has done for a long time. So, you know, I, I see Bitcoin as sort of like fitting hand in glove with the culture that craves savings. There, there's so many people within Korea that want to save, and I think it's almost part of our DNA. One, once, once like Bitcoin gets to be known as that, I think it takes off like crazy." }, { "speaker": "stephan", "time": "01:07:48", "start": 4068.92, "text": "Yeah, yeah, yeah. I think there's, there's so many exciting things and, developments all around the world happening. you know, it's, I think the interesting thing is a lot of the media kind of focuses only on the US world, right? And it's kind of obviously, you know, you're an American, and a lot of the stuff I talk about is from the American world, but actually there's this whole world out there, and it's starting to" }, { "speaker": "guest_3", "time": "01:08:13", "start": 4093.65, "text": "You, you underestimate Asia at your own peril. It's a, it's a giant, giant population. And if anything catches on here, it's dwarfing anything that happens in Western Europe or the US. So, you know, I mean, it's a, it's a-- This is a country that was a little bit late to the game, really didn't come online with the Bitcoin stuff until the Gimchi prem-premium in twenty seventeen. So you figure they're like five, six years behind everywhere, everywhere else. And, you know, you can kind of see the seeds of- Of maximalism really being planted here, and that's the-- that's the thing that matters, right? Store of value, savings, u-using it as better money rather than a gambling vehicle, and that's, that's, that's what I'm gonna, I'm hoping for, and, that's what it seems like it's, you know, that, that's the growth edge here, and it, it can be very, very powerful once it takes root." }, { "speaker": "stephan", "time": "01:09:04", "start": 4144.97, "text": "Fantastic. Well, everyone check out Jimmy's work. He's the author of Programming Bitcoin, and" }, { "speaker": "guest_3", "time": "01:09:13", "start": 4153.83, "text": "I've never done this before, it's, it's g-it's pretty" }, { "speaker": "stephan", "time": "01:09:15", "start": 4155.97, "text": "cool. I hope you enjoyed the show. If you did, make sure to give it a thumbs up and share it out there with your family and friends. Check out my website at stephanelivera dot com, and I will see you in the citadels." } ] }