{ "episodeId": "SLP63", "speakers": { "stephan": { "name": "Stephan Livera", "role": "host", "tag": "STEPHAN" }, "lightningk0ala": { "name": "LightningK0ala", "role": "guest", "tag": "LIGHTNINGK0ALA" } }, "segments": [ { "speaker": "stephan", "time": "00:09", "start": 9.07, "text": "Welcome guys, this is the Stephan Livera podcast. This is episode sixty-three. We are focused on Bitcoin and Austrian economics. Today, we've got a fantastic guest. He has been setting the world alight with some of his fantastic Bitcoin and Lightning powered gaming, which, you know, started well- What we know, most of us know him for, is Satoshi's Place, which was this awesome online, pixel drawing thing where you can pay with satoshis, and now he's taking that to the next level with Lightning Chess and his broader, business or, venture, which is Koala Studio. So my guest is Lightning Koala, welcome to the show." }, { "speaker": "lightningk0ala", "time": "00:52", "start": 52.26, "text": "Hey guys, it's amazing to be here. I'm really happy to be here." }, { "speaker": "stephan", "time": "00:56", "start": 56.09, "text": "Yeah, look, I think you've been doing some fantastic stuff. it, I thought it'd be great to just, you know, have a chat with you and just- Get you to share some of your insights on your background into Lightning development." }, { "speaker": "lightningk0ala", "time": "01:10", "start": 70.44, "text": "Sure, yeah, I can get started with my background. So my first experience with Lightning was actually with the Zap Wallet by Jack Maers, and so, this was probably, end of two thousand and sixteen, I think. I synced it with Testnet, I tried opening some channels, and I was playing around with the Eclair Explorer, which was one of the first, web explorers. We're looking at lightning nodes and stuff, and, and then eventually back in January 2018, I set up some LND nodes, and I just wanted to test the throughput on a single channel between two nodes, 'cause I, I was just curious to get a sense of like how far the implementations had gone, and also, people were talking about, you know, micropayments and like low fees and stuff, so I just wanted to see like how many transactions per second I could get, and I, I really- Can't remember the number now, but I remember I was really impressed at the time, and, and it just thought, I just thought like, \"Wow, like this, this looks like it's gonna be able to do some really cool stuff.\" So I started thinking about like, what kind of, applications could we, use to, more like to showcase like the, the technology. and so I started thinking about things like Street Fighter, where maybe you could have like some punches like equating to a payment Or, and then one, one which I got really, actually started like building a prototype for was, like a Make It Rain application with Satoshi. So the idea would be to have people, sort of like, imagine you'd be like presenting something at a conference, and then people would just like connect to you, and then you'd be able to like throw them Satoshi's on this application. So since we're live stream, I," }, { "speaker": "lightningk0ala", "time": "03:00", "start": 179.72, "text": "I wanna show you a little demo of that. Yeah, let's" }, { "speaker": "stephan", "time": "03:02", "start": 182.08, "text": "go, let's do it." }, { "speaker": "lightningk0ala", "time": "03:03", "start": 183.48, "text": "Sure. So, let me just, wrestle technology here. Okay. So, can you see that?" }, { "speaker": "stephan", "time": "03:11", "start": 191.27, "text": "Yeah. Okay, so just for the audio listeners, just, just talk through what is showing on screen as well." }, { "speaker": "lightningk0ala", "time": "03:17", "start": 196.75, "text": "Sure. So right now I'm on a, on a page. We can include the link in the, the description for the episode, but, it's essentially just like a black screen with, a white square in the middle, and it's kind of like 3D, so it's like a platform, and sitting in the middle of that, let's say it's a table, there's a, there's a Bitcoin coin, and the idea is that you can just, click the coin, eventually it'll be like swipe, and then it would just" }, { "speaker": "lightningk0ala", "time": "03:51", "start": 230.78, "text": "Coins, I don't know if, the audio sound. It's the word" }, { "speaker": "stephan", "time": "03:52", "start": 232.1, "text": "\"Bitcoin.\"" }, { "speaker": "lightningk0ala", "time": "03:54", "start": 233.58, "text": "Yeah, and you can just kind of like make it rain like that." }, { "speaker": "lightningk0ala", "time": "04:00", "start": 239.71, "text": "So I spent a lot of time and effort making the sound effects for that, but that's, that's, I'll, we'll leave the link and, and for people who can't see it, they'll, they'll be able to, like, check it out. So I'll turn it off now." }, { "speaker": "lightningk0ala", "time": "04:14", "start": 253.89, "text": "let's see, yeah. So the idea with that little demo was just to try, to kind of, you know, to throw Satoshi's at people and to show how like quickly it would be done. But the issue was that, I, I, you know, back then I was, I was like, \"Oh, hang on, we're gonna have to like open channels with people, and there's gonna have to be liquidity and so forth.\" And so I, I very quickly like dropped the idea 'cause I realized it would actually be quite hard to execute it, at the state of affairs back then. so, so I kept at it and I, and I eventually came, to the idea of building Satoshi's Place, which, was heavily inspired on Reddit Place, which was this, thing that, Reddit did for April Fool's Day, I think on, in two thousand sixteen, which in its turn was also, was also inspired in the million dollar homepage, which is a much older, project. I wasn't actually aware of the million dollar homepage, but Reddit Place Was really cool, like it lasted for about four or five days, and there was all these people like, painting pixels on the canvas, but there was no payments involved. It was just like each account could paint, one pixel per Five minutes, I think. there's a funny story because, the, the engineers kind of spoke about how, they were trying to like keep their servers from, from catching fire when this thing went off because it, it was like very, very, there was a lot of traffic. And, and so that timer that they, had was actually, they were tweaking that to kind of, sort of, filter the amount of people that were coming through, Interesting, you know. So anyway, Satoshi's place was, was inspired on that, and the, the idea was that I wanted, people who had never used Lightning, to have a place where they can go and experience it on an application level. So for somebody who had, who had just like downloaded a wallet, like a Claire or, or a Zap, they, they would have a place to go and like try this thing out. and at the time, like, it was already places like Y'all's and, Maybe like one or two other places, but I wanted like the, like dirt cheap, like, like bottom, like hitting the bottom like of the, of the kind of price and of course, you can go lower with millisats, but I thought satoshis was probably a good one, a good place to start." }, { "speaker": "stephan", "time": "06:41", "start": 400.88, "text": "Yeah, that's fantastic. I think it's really cool that it just, for, for a lot of people, seeing is believing. So for them being able to have, you know, on their phone, \"Here's my, here's my, whatever, however many satoshis I've got, and I, I click these pixels on the, on Satoshi's place, and then I pay, scan it, off it goes How, like, for people who have been around in Bitcoin for a while, sending their first Lightning payment is kind of similar, there's analogies to sending your first Bitcoin payment, there's this, that sense of magic around it. Tell us a little bit about that." }, { "speaker": "lightningk0ala", "time": "07:17", "start": 437.48, "text": "Oh God. yeah, I mean, it, it's, it's, it makes you feel giddy just kind of like, playing with this thing. It, it's, it's like sending an email back in like the early nineties or late eighties, I guess. I don't know, I don't know, like, you mean, you mean like in terms of the experience? Like- Yeah, exactly, like, because it's just," }, { "speaker": "stephan", "time": "07:39", "start": 459.09, "text": "because many people who are used to Bitcoin, they sort of know it, well, before Lightning, they had- You know, there were always these kind of niggling issues with, with doing on-chain payments for kind of low value, right? Because it wouldn't confirm immediately, you might have to, you know, just around some of that difficulty of the transaction may have been broadcast onto the network, but it hasn't yet been confirmed into a block. Whereas with a Lightning payment, obviously, we know it is In a sense, it can be kind of settled back into a block, you know, when you need it to. And so I think there's a certain power to that. Yeah, the" }, { "speaker": "lightningk0ala", "time": "08:18", "start": 498.04, "text": "experience is, is, more instantly gratifying, I guess, because, even though you can sort of, you can detect an on-chain transaction when it's, you know, when it gets propagated, but it hasn't been confirmed yet, you could treat that as sort of like that dopamine release of like, \"Hey, it's working,\" but with Lightning, it- It, it feels a little bit more, more real, and also the fact that it's like, it's so cheap, so it really doesn't, doesn't hurt as much, I guess, in terms of like, oh, I just spent five cents to do this, to send like, I don't know, one dollar transaction. If you go much lower, it doesn't make sense anymore, right? But back in the day with Bitcoin, that was kind of the same feeling because, the, the fiat value of, of Bitcoin wasn't so high, right? So around with the tipping as well, you know, like it's, it's almost like Lightning has brought back this culture of just giving Bitcoin away, giving Sats away, you know? and yeah, that's almost poetic, it's quite beautiful to see that coming back." }, { "speaker": "stephan", "time": "09:24", "start": 564.35, "text": "Yeah, fantastic. Okay, so tell us a little bit about, you know, I guess why are you-- 'cause you're building on Bitcoin and Lightning, right? So in order to do that, you must be fundamentally bullish on the technology. Tell us why." }, { "speaker": "lightningk0ala", "time": "09:40", "start": 580.02, "text": "Yeah, it's so hard. For the audience, like Stefan sent me this question and I, I struggle a lot to prepare for it 'cause I think there's so much to be bullish on it, but, it's, it's, it's really hard to me to like pinpoint the exact fundamental, but I'll try. So I think, let's say like on a monetary level, I, I'm really bullish because of the fact that Bitcoin is following the principles, principles of sound money and, I think we've reached a shelling point around the twenty-one million cap, and, you know, like how, the Yang thing that's going on in the US now." }, { "speaker": "stephan", "time": "10:17", "start": 616.67, "text": "The Yang gang thing. Yeah." }, { "speaker": "lightningk0ala", "time": "10:18", "start": 618.37, "text": "Yeah, Yang gang. Like one of the things he says is the trickle up effect. I like to say that, that, the, the sound money is the real trickle up effect, and like the twenty-one million cap, is, is that kind of, the consensus rule that's, that's gonna cause that to happen. And, and so, yeah, I think the impact on society in that respect is gonna be tremendous. I won't go into that, there's much better people to talk about that, I, I think. But on a technical level, what makes that possible, is the fact that I see the protocol evolving in ways that improve the ability for users to run their own full nodes, as in, you know, don't trust, but verify. but equally, there's also am-amazing progress towards privacy See, and I think these two factors combine contribute towards, the ability to ossify the consensus layer and, which eventually allows us to start building on top of it, because, you know, as a, I mean, speaking from a personal, experience as an engineer, you don't wanna bu- you don't wanna, you don't wanna build on a foundation that is, is not stable, right? You don't wanna build on a protocol that's not gonna be around for the next ten or twenty years, right? So, I think that's It's really bullish and, yeah, and so we're seeing that with like second layer protocols like Lightning and Liquid, and overall, you know, this- The, the way the protocol stack is evolving is following the principles of the Unix philosophy, which is all about minimalist modular software. So, you know, those two things combined, they kind of like complement each other, but because of the, the, the incentives, but, essentially That, that was my attempt to answer this question. Yeah, yeah, sure." }, { "speaker": "stephan", "time": "12:05", "start": 725.22, "text": "No, I think, I think there's, I think there's a lot you're getting at there, and you c- we can sort of pull some of these apart and see in practice how that's happening, right? So a couple examples, that might have come up in some of my recent episodes as well is like we're starting to see different sort of technology stacks evolving within Bitcoin, right? So you can kind of have Bitcoin Core, LND, and then set up Zap and Jool, and that's" }, { "speaker": "stephan", "time": "12:33", "start": 752.64, "text": "wallet, and, you know, you can set up different-- there's different kinds of stacks, and all these kinds of different pieces of software can kind of all connect to each other and be used in this kind of way that creates an overall really amazing outcome." }, { "speaker": "lightningk0ala", "time": "12:47", "start": 767.06, "text": "Yeah. And, and that's how the internet is, is built. So it makes sense to, to, to mimic that, that process in, in Bitcoin." }, { "speaker": "stephan", "time": "12:58", "start": 777.67, "text": "Yeah, exactly. so look, let's talk a little bit about Satoshi's Place. So, I mean, you mentioned a little bit around the background of it, but how about, you know, some of the hardware and the software setup and maybe any challenges that you faced in creating Satoshi's Place?" }, { "speaker": "lightningk0ala", "time": "13:14", "start": 793.92, "text": "Sure. So my background, is as a electronic engineer. I, I used to be a hardware designer like, over ten years ago. but since then, I, I've focused mostly on just software. but, you know, single board computers, Raspberry Pis, those are things that I, I like to tinker with and I like to play around with. So back then, when, when I was starting to build Satoshi's place, I made it, like my own objective to say, okay, I wanna build this, I wanna run the- The, the lightning, part, they meant on, on my own node at home. Like, I just want, I wanna try and do that. So with Satoshi's place, I, I used C-Lightning because at the time, LND hadn't yet, ha- implemented support for Bitcoin Core, I think it was only using BTC shortly after they added support, but, that, that was my decision back then. and then in terms of the, the single- Single board computer, like I, I felt like the Raspberry Pi was probably gonna be," }, { "speaker": "lightningk0ala", "time": "14:20", "start": 859.96, "text": "not weak, but like a" }, { "speaker": "stephan", "time": "14:22", "start": 861.7, "text": "little underpowered, yeah." }, { "speaker": "lightningk0ala", "time": "14:23", "start": 863.1, "text": "Yeah, a little underpowered. And I just shopped around for some options and, one of the, the, the options was Odroid, they have a, single board computer with two gigs RAM, and, yeah, it seemed like a better, better choice. Actually, the Rock 64 is also a really good choice, which I believe you have a model. Not all. Yeah." }, { "speaker": "stephan", "time": "14:44", "start": 883.54, "text": "That's right." }, { "speaker": "lightningk0ala", "time": "14:45", "start": 884.96, "text": "So, so yeah, that, that was the hardware part, you know, then I had to like get a fixed IP and, and like set it up at home and, and there's like All the things involved with doing that and, yeah. And then, but the application itself is in the cloud, right? So even though the node is, is, is my own, I'm running in my, in my own, network, the application is sort of deployed in the cloud, because that's just the way I, I build software and I'm used to doing it. And, I'm glad I did because the, like, in the peak of like the traffic that was happening at Satoshi's place, there was was, over ten thousand people visiting the site, and there's a lot of people hit-hitting the backend server, and so, I built it so it was kind of like load balanced on like, multiple containers that could just be like added, on demand, so Yeah, but the actual payment processing was being done at home, which," }, { "speaker": "lightningk0ala", "time": "15:50", "start": 949.85, "text": "yeah, that, that's basically the, yeah. Okay." }, { "speaker": "stephan", "time": "15:53", "start": 952.69, "text": "So if I could summarize that then, it's kind of like you were kind of making it in line with that Bitcoiner ethos, which we talk about, which is you should run, you know, ideally you, you run, the software in such a way where you hold the keys and you are validating fully, right? So that's kind of the self-sovereign, fully validating component. But then what you were doing is setting up such a- Such that it-- the software was running on the cloud or running on a cloud, you know, like VPS servers, but then the payments that were coming through, were still coming through to your own node, so that's kind of really in line with the ethos. And I think that was, that-- the thing with Satoshi's place is it's just, it was really cool because it, perhaps, that was what helped prove out that there, there's some-- there can be some kind of demand for this in, in the years to come. So what, what was it about? About this that made you believe, okay, there's a future opportunity here?" }, { "speaker": "lightningk0ala", "time": "16:50", "start": 1010.42, "text": "in Lightning? I mean, so- Adam Back, Adam Back's like hashcash thing with like, trying to solve the issue of like email spam and, and I think to me like, lightning represents a form of, of, using Bitcoin that, that can potentially solve that problem, so, so I- This, this is part of like why I was, I was built, why I built Satoshi's place is I just wanted to see like, is this, this concept of like using microtransactions feasible, right? And, and so-" }, { "speaker": "lightningk0ala", "time": "17:32", "start": 1051.79, "text": "yeah, I'm, I'm just, I think that, that's, that's the really interesting application of it. There's, there's a lot of things related to like whether or not we actually want to use micropayments in certain applications. Like, you wouldn't really want to pay, for each second of Netflix that you watch, maybe. People tend to prefer like subscription services, in those cases. But certainly in, and, and maybe, maybe, you know, that's- It's not always gonna be the case, like I, I think that, sort of consumer patterns and like the way people, people's preferences change over time, so I, I wouldn't say like that's gonna be like always the case. Maybe, you know, in some future where- People are like half man, half robot. Maybe we have enough processing capacity to, to do those kind of things. I don't know. But certainly in a machine-to-machine, payments world, it, it makes a lot of sense, right? So, You know, I'm thinking like what the work, Sherbits is doing, where they're trying to like use Lightning to, to monetize APIs and so forth. I think like the granularity that, that, the payment network, such as Lightning, provides for machine-to-machine payments, makes a lot of sense, because for a machine to like process a micropayment or do the accounting for a micropayment isn't as mentally taxing for a human, right? So, now you suddenly have this ability to do like high-resolution payments. so that's one element of it. the other, going back to the, to the hashcash thing, the, like the spam thing is like, well, You know, the, the, the hashcash thing was trying to solve it with proof of work, but now we have a digitally native money and we have the ability to do micropayments and at really high velocity. I mean, I, I, I joke about like Keynesian econ- economists saying like, talking about velocity of money, it's like they haven't seen velocity of money yet. Like, like real velocity of money with Lightning." }, { "speaker": "stephan", "time": "19:35", "start": 1174.58, "text": "Yeah, it's a very, monetarist and Keynesian idea, yeah, of these kind of velocity of money ideas, Strong critiques against that, yeah, definitely. Yeah, they haven't seen" }, { "speaker": "lightningk0ala", "time": "19:45", "start": 1184.91, "text": "actual money velocity yet, they're about to see it with Lightning. so anyway, that's, that's a half joke, half truth. so, so that's the other aspect of it, it's, it's the fact that, you know, to combat spam, and I don't know if, if this is gonna materialize, but, you know, this, this whole thing of like, the noise in social media and, and like, you know, on Facebook And so forth, like, I, I really do think that there is, there might be something there where, there is a way for us to tr-attribute value to, to our online interactions, and then we can use that as an added filter of noise, because right now, like, you know, you can use reputation, And, and, and other things, but if we could add value as a, as a category, not a category, but as a filter option, that could complement some of these other ones. I don't know, I think there's something there. yeah," }, { "speaker": "stephan", "time": "20:47", "start": 1246.86, "text": "yeah, I agree. I think that's a fantastic idea because right now, even look at something like Twitter, right? There's all these bot accounts. But imagine if Twitter set it up such that for every bot you had to pay whatever, a thousand satoshis, whatever, whatever that limit is enough to make it costly for these bot farm people to set up, you know, to spin up ten thousand Twitter bots, but not so expensive that it prices out real people." }, { "speaker": "lightningk0ala", "time": "21:14", "start": 1273.84, "text": "Exactly. And, I mean, man, I, I have this problem all the time with the Satoshi's place Telegram. I mean, it's a bit of a, of a zombie, group anyway. I don't necessarily actively promote people to, to go on it, but, now and, pretty much weekly, like some bots will jump on the, on the chat and they'll like spam the chat with like tokens and like, I don't know, random shit, and it's Like, you know, that, that's a, an automated bot that's doing something that's virtually costless, but it's costing me my time and my effort to, like, get rid of that, you know, in the, like- 30 seconds that it takes me to delete and ban and report the spam on each one of those, those things, like that, it didn't cost as much in, in, in for the bot, right? So, yeah, I think there's a, there might be something there, I don't know. and time is the most valuable thing we have, right? So, Yeah." }, { "speaker": "stephan", "time": "22:14", "start": 1334.16, "text": "Yeah, cool, cool. Nice. so look, let's now go into your thoughts on Lightning Gaming and Koala Studio. So maybe just give us a bit of the context around, around that." }, { "speaker": "lightningk0ala", "time": "22:27", "start": 1346.68, "text": "Right, so, with Koala Studio, so with Lightning Gaming, the, the kind of the story is, after Satoshi's place, validated this idea, this crazy idea that I had in my head, I went back to, to sort of the gaming thing, because originally, I mentioned Street Fighter earlier in, in our chat, and, you know, this idea of like player-to-player interactions, And, and I wanted to go back to that, and so, no matter what, like, I, I decided like, I, I wanna focus on Lightning, like, there's something really big here, I'm really interested in, in, in building on this stuff, so, I quit my job back then and I decided to just like Focused my thought, entirely on this. And around about that time, Chaincode Lab invited me to come to the, to be a mentor at, the Lightning residency and that they hosted last year in October. And, I had to do three talks, so I decided to do two talks about Satoshi's Place, the history and, and the tech stack around it, and the experience. But then my third talk was, what I called Lightning Network powered games. So, for that talk, I, I kind of delved into exploring about, ways that the existing, gaming industry uses money, and try and like figure out, where, Lightning and Bitcoin, can provide, The, you know, the 10x, improvement, and, and, in particular with peer-to- with player-to-player interactions, like I wanted this, this whole thing where you could, either wager, wager a bet or, you know Pay the other player for some kind of interaction in the game. and, and at the, at the residency, there's, there's an interesting story. Like, I, I spoke to Jack Morales, he was also one of the mentors there, and he told me Oh yeah, man, I'm, I'm gonna go play a game of chess in the parks after this. And I was like, \"You're gonna do what? \" And, and then he explained to me that, you know, he's an avid chess player and, Back in Chicago, he, he usually goes and like meets random people in, in parks and then he plays them. And actually, this is interesting because I, I grew up in, in China and, I remember like seeing, elderly people playing Chinese chess in, in the parks and like just gathering around. I was like, \"Huh, that's, that's a, that's a, that's a real thing.\" And, And, and then he said, \"Well, I've always wanted a chess game where I could pay the other player to undo a move, or extend the timer, or even just wager a bet.\" And, and I was like, \"Aha!\" 'Cause I, I was looking for the, you know, building games isn't easy, there's a lot of work into, into building games, and, and I was looking for like, the, that game proof of concept that it, that was like feasible for me. I'm not a game developer," }, { "speaker": "lightningk0ala", "time": "25:40", "start": 1539.71, "text": "so work concept that I could, build these interactions in, and then that was it. Like, so when I came back from, from the residency, I, I, I decided, okay, this is what I'm gonna focus on and that's where I, I got in contact with Andre, who was one of the residents at the, at the event, and, yeah, I just said, \"Hey, man, like, I'm gonna do this, do you wanna help me out?\" and he said yes. and then he was, he was like also busy with, with, his work, so he had to moonlight, but, essentially like in three months, we managed to build Koala Studio and Lightning Chess." }, { "speaker": "stephan", "time": "26:21", "start": 1580.93, "text": "yeah. Fantastic. Okay. And so tell us about your experience so far in terms of, user setup and, you know, kind of getting people to, you know, get into it and use it." }, { "speaker": "lightningk0ala", "time": "26:33", "start": 1593.16, "text": "Yeah, so, let's see, maybe, maybe I should explain a little bit about what, what Koala Studio and, and LightningK0ala is because people might not know. So- So the idea is that, you know, Lightning Chess is this game where you can go in and you can wager against your opponent, but then you can also pay him to undo a move and you can pay him to undo, to extend timers, right? now the problem in this situation is that if, if we're doing these Lightning-- and, and this is all microtransactions, right? So you can pay him like one Satoshi to undo a move. and the i-- the problem here is that if you're gonna do it with, with Lightning channels problem, the onboarding is just, and I, I mean, expecting a mainstream user to like understand this stuff, to understand Bitcoin is hard, to understand Lightning, it's like next level, like, unrealistic. So, but, but regardless, you still have the issue of like liquidity, right? The, the inbound liquidity. So," }, { "speaker": "lightningk0ala", "time": "27:35", "start": 1655.44, "text": "And, and then, and so the, the, the, the reasoning was that, you know, in, in real life and even in like online gaming, we always trust like this kind of, authoritative, server that, that is the, arbitrator of the game, right? It, it's, he will dictate the, the outcome of the game. and so in Lightning Chess you know, you trust the our game, like us, to dictate whether or not you win, or lose. And, and so if you set up a wager, for example, like, I mean, that's it, you just have to kind of trust us to, to dictate the outcome. Yeah, and that's kind" }, { "speaker": "stephan", "time": "28:16", "start": 1696.43, "text": "of the problem with that." }, { "speaker": "lightningk0ala", "time": "28:18", "start": 1697.57, "text": "Yeah, it's, it's the oracle problem, right? And there's the incentive for us because we're providing that service. But anyway, but, you know, along with all these liquidity problems and so forth," }, { "speaker": "lightningk0ala", "time": "28:31", "start": 1710.68, "text": "able to, to expect people to, to be setting up channels and so forth. So we decided to set up, you know, inbuilt, a custodial account in Koala Studio Lightning Chess. So the idea is that you come in, with one click, you-- it sets up an account for you. There's no email, there's no KYC, no anything, and you can just hop in a, a chess game, and then you can send somebody a link, and you can just play chess normally if you want, or if you wanna use these interaction Then you deposit into your account, and then once, once you-- it's like an arcade machine at that point. Like you put some coins in the arcade machine, you play the game, but now the crucial difference is that you can withdraw the money from the arcade machine. it from Koala Studio in this case. So, so that kind of just abstracts the complexity of setting up your, your lightning nodes and having liquidity and all that stuff, and so- Because, because, you know, I, I wanted to make more than one game, the idea was to archi-architect the system in a way that I could just plug in multiple games. and so the, the challenges in onboarding and stuff, I mean, obviously, if it's people that are already in Lightning, it's, it's generally fine. Like we, we haven't had any liquidity complaints or anything, that, that's been fine. But I've had actually a lot of people who like came into it, Because of the game. Because, so my thesis is like, you bring in people for the game, and then they go down the rabbit hole because of the Satoshi's." }, { "speaker": "stephan", "time": "30:09", "start": 1809.11, "text": "Yeah." }, { "speaker": "lightningk0ala", "time": "30:09", "start": 1809.39, "text": "Right? And, and similar to Satoshi's place, like- People were using it, were, were like being exposed to Lightning for the first time because they saw this crazy, like, toilet graffiti website, and they wanted to participate in it, and then they realized, okay, like, if I wanna use it, I have to, to, you know, figure out the Satoshi's thing. and so, the idea with Lightning Chess is the same thing, like, you can just go ahead and play with it, if you wanna use the monetized features, then you need to figure out the Satoshi's thing. and that's the onboarding That we have to, to, to solve, right? And so, we created this thing like with vouchers so we can just give people satoshis, and it, it was pretty cool. Like, I, I actually printed a couple cards, damn it, I don't have them here. But yeah, we printed a couple of cards and, dished them out at events, sent them, we can even just send the code to people and this would just credit them with some satoshis in their account and then they could just start using this stuff. And some" }, { "speaker": "lightningk0ala", "time": "31:15", "start": 1874.66, "text": "actually we're like, okay, but how do I withdraw it, right? And so now, this is the rabbit hole part, it's like, okay, well, now we need to get you to download a wallet, we need to get you to buy, a custom node, we need to, you know, whatever the spectrum of, of, trustlessness that you want, we need to figure something out there. And, and that's, I mean, I, I, I'm not gonna say that we've solved that problem. problem, but it's definitely like, something that, that's really interesting and we need to figure that out. in terms of onboarding, like, it's the same thing, except that, you know, you can actually, get started if somebody just like sends you some satoshis on this account, right? So, so technically speaking, you're on a custodial account, but, yeah." }, { "speaker": "stephan", "time": "32:06", "start": 1926.45, "text": "Oh, yeah. Look, I don't, I don't think you guys should, try to make everything fully non-custodial. On site, most people, in my view, they're comfortable with like, it's not like they're putting their life savings on, right? They're, they're putting a certain amount on the site just purely because they wanna use it for the game, right? And that's just like in-game bucks in other, you know, in other online games and stuff. but I think more to the Bitcoin and Lightning components of it, what we probably need to see is for some of these newer technologies coming down the line, like we are still so early, right? Once, because right now it's You know, incoming liquidity, and once we have things like AMP and splicing, these, all these things will come in." }, { "speaker": "lightningk0ala", "time": "32:49", "start": 1969.02, "text": "Yeah, exactly. And, and there's some really interesting, cryptographic schemes that we can do to, like, remove the, the ability for like the intermediary to even like take the funds away. so I'm like super bullish on, on just this general, like, structure. it's just that right now, that's the reality. It's still early, and- We needed a solution to, to, to solve that problem, right? It's, it's essentially the fact that like you and I, can enter a wager into a game, and the problem is that if you win, there might be the case where the payment can't resolve to you, right? And so we need that kind of like interim pot that can hold it, so you just don't, you know, you don't lose it, and then you can just keep retrying the, the claim, thing. but Yeah, the way, the way I see it is like there's, a certain percentage of like failure rates, there's a certain failure rate in like payments right now in Lightning, and, whatever that amount is, what we're gonna, what we're gonna see over time is just that amount's gonna go down, down, down, down, down, down Up until a point where it's like, you know, less than a percent, or maybe already is, I don't know. But it's, it's so small that it just, it doesn't impact the, the user experience negatively anymore." }, { "speaker": "stephan", "time": "34:10", "start": 2050.43, "text": "yeah, yeah. And I suppose part of that then is kind of the, how do you take that user on the education journey, right? So maybe, I don't know, in the future you might even do some kind of setup where they can put fiat money into the site and kind of buy their first satoshis that way and Some out once they like get a lightning wallet and so on, these are all kind of ideas that people can use." }, { "speaker": "lightningk0ala", "time": "34:34", "start": 2073.91, "text": "Yeah, I mean, the, the beauty with it, is that it's kind of like an interoperable protocol, right? So technically speaking, like, we don't actually need to implement the fiat part ourselves, like, we can actually just use a third party provider, and as long as there's like an API that we can integrate with, then that's it. That was, that was kind of the i-idea with Satoshi's place as well. So, I actually published the API documentation for how to like paint it programmatically. Some people actually figured it out before, I published the LightningK0ala was one of them, and they put like, they painted the whole board with, the FBI seizure notice for Silk Road. It was hilarious. Nobody reverted it. but the idea was that, you know, I had people asking me, \"Oh, can you implement a feature to, you know, make it so you can lock pixels for a certain amount of Satoshi?\" Or, or something like that. And I was saying, look, all you need to do is write a bot that will persist your pixels, right? And then you give it a budget, and then it will like protect your pixels. In fact with this API, and, and sorry, like the, the other thing is, for example, uploading an image. Like, yeah, I didn't impl-implement that feature in, in Satoshi's place because I wanted to say, hey guys, like, you can make a third party website that, that offers that feature for a service, right? So you can create a website that allows you to upload a picture to Satoshi's place in a nice UI, and then you basically, you get a payment request from Satoshi's place, and then you generate your own with a surcharge or whatever And then you just daisy chained the payments, right? And so I wanted to kind of see that ecosystem of, third party applications being built, like sort of layer two applications on Bitcoin, oh, sorry, on, on Satoshi's place. we didn't really see it come to fruition unfortunately, but, but that's the idea behind what you're saying, like if there's a fiat conversion or something like that, because we're kind of like on this interoperable protocol, then technically speaking Like, you know, if you, if you feel like, if you think that you can implement something like that, then go ahead, and then, oh, by the way, make an API for it, and now suddenly everybody else can plug into that system. Yeah, exactly." }, { "speaker": "stephan", "time": "36:52", "start": 2212.31, "text": "And I think that, that kind of goes more broadly with Bitcoin and Lightning gaming as well. So I think this idea of one unit of account and very interoperable, across different services. So let's say you've got different gaming sites and they're all using Bitcoin Lightning, well, now it's kind of easy to kind of take out from one site, put into another. It just kind of all flows more nicely. So talk a little bit about that and kind of the broader sense of where you see that going." }, { "speaker": "lightningk0ala", "time": "37:21", "start": 2241.31, "text": "well, I think the, the as, as the ecosystem grows, eventually we, we start kind of getting a circular economy going, right? The idea is that, even on, on Koala Studio in its current, incarnation, like, you know, you have some satoshis there, and okay, well, maybe you can't withdraw it to your own node because you don't have liquidity or whatever, but hey, guess what? Like, you can use it to pay for some Blockstream stickers or- Or buy a coffee somewhere or something elsewhere, right? It's, it's like, the idea that, and, and that's just like talking about the, the satoshis and, and lightning payments, but for the fiat on ramps, it's the same thing, like eventually the I think like the, the, the, what's the, the word, opti, let's say optimistic outcome or like the, the, the best outcome that we can, can get to is, is the point where like, oh, I don't need to like jump back into fiat anymore. And I think we are sort of there in certain patches, like certain people already earn in Bitcoin and then, you know, they use services like Bitrefill or, or, what was the name? The one with the Amazon?" }, { "speaker": "stephan", "time": "38:37", "start": 2317.23, "text": "Oh, purse, purse dot io or one of those, yeah." }, { "speaker": "lightningk0ala", "time": "38:41", "start": 2320.76, "text": "Yeah, but there's still a way to go." }, { "speaker": "stephan", "time": "38:43", "start": 2322.95, "text": "Yeah, definitely. but I think it's really cool that it's- It's, it all drives towards that idea of Bitcoin, the reserve currency, and it, it may even become kind of, it may start in certain patches, as you say, so it may be that Bitcoin is the reserve currency of the online gaming world." }, { "speaker": "lightningk0ala", "time": "39:00", "start": 2340.26, "text": "Yeah, well, with the, with the online gaming, the, the reason why I'm super excited with it is because, I, I see sort of the 10x innovation in, in the peer-to-peer, things, like with, with the-- I, I'm not saying that everything else isn't worth looking into, but the, the merchant adoption thing, you know, like trying to replace," }, { "speaker": "lightningk0ala", "time": "39:26", "start": 2366.44, "text": "POS systems and, and, with just like saying, \"Hey, use Bitcoin or Lightning now,\" like it's, it's very challenging, especially in the West, not only in the West, like even in, in China where you have like WeChat, it just works everywhere, i-it's just like It's very hard to compete with that, user experience because it's actually pretty good already, you know, tap and pay and, and contactless and, and those things. And then you have Gresham's Law, which is another one that bites you, right? It's like, the incentive to spend Bitcoin over fiat, it's quite low, yeah. Right. You might as well spend your shitty fiat first, and keep your, your, scarce Bitcoin, right? And so, so that's why I'm- I'm really focused on like, okay, what is the, what are the applications and, and the use cases that you don't have an alternative? And that's where I see like the, yeah, the kind of the main adoption coming from. And so for example, for Bitcoin, it's, it's like sovereign money, right? And, and privacy and, and, and a store of value. I, I think that's like the, the biggest use case. But with Lightning, now we have a different security trade-off that gives you different properties, and, and so what are, what are the, the, the features that those properties are gonna excel at?" }, { "speaker": "stephan", "time": "40:52", "start": 2452.2, "text": "Yeah, right. And I think it also can be really cool to just see how it sort of evolves out, right? Like so we might see more and more of a tipping culture into-- 'cause right now we have a bit of a tipping culture within Bitcoin and Lightning, that doesn't necessarily exist in the broader world and in the broader internet yet, but it, it may come one-- because right now most of us are kind of people who are like into this stuff, so we know it now. But imagine, you know, a few years down the line, once some of this tech- Technology is a little bit better and it's easier to set up with a proper sort of wallet that can both send and receive, like, and is non custodial, and then imagine like kids who are like fourteen and they're like playing games online and they can quickly send each other satoshis, you know, or like they wanna donate to their favorite streamers online, like that. All this is some of the possibilities that I could see coming." }, { "speaker": "lightningk0ala", "time": "41:45", "start": 2505.0, "text": "Yeah, I mean, the demographic is another huge one. It's like, you know, we're building for the next hundred years And we need to look forward, right? And, and so the-- to me, it's like, it's that younger generation that's coming up where, you know, iPads are ubiquitous. Like my, I, I watch my nephews and it's just like they're watching TV with an iPad in their hand, and like, you know, it's just so natural for them. And, and so I think Andreas talks about this a lot, like how, like the, the, you know, the, the kids nowadays are gonna like go up to the bank with like sixteen or eighteen To open a bank, it's like, I need to what? And then you're only open till what? And that's, yeah, to me it's, it's, you know, they're just gonna leapfrog all of that and they're gonna start using, Bitcoin and Lightning like at an early stage so that by the point they, they, they reach adulthood, it's just like It doesn't make sense to use anything else. and with gaming specifically, like it's pretty cool because it's, it's like, it's a younger demographic that you're aiming for anyway, and so, you know, they're more likely to adopt new technology. there's actually, barriers of entry for them. so, you know, there's It just makes a lot of sense to me." }, { "speaker": "stephan", "time": "43:07", "start": 2586.89, "text": "Excellent. So let's talk then about what, what the opportunity is with Koala Studio. So, have you got any ideas in terms of what is coming up in terms of games ideas or development ideas for Koala Studio?" }, { "speaker": "lightningk0ala", "time": "43:21", "start": 2601.48, "text": "Yeah, I don't know how much of it I can share. Okay. Like, in the last two or three weeks, we've been, working on our fundraise, so we were over at, I actually flew over to Boston for like, MIT Bitcoin, Expo and, it's just been consuming a lot of our time, so, we haven't been, been able to like build out the, the vision that we have, so we have like a, a very, well-defined, strategy for the next year, and, you know, for the next three or for six months, there's like certain things that we wanna like build and, and release and like come out with that, and I'd- I'd rather like talk about them like once we're ready to like ship it, right? Yeah Yeah Yeah. Rather than just, just start talking about this. But, yeah, I mean, our, our aim is to, to, build out this vision of, of, lightning network powered games. And, we, we, we don't know if we're gonna be building the games ourselves yet, but that's, that's not off the books. we're- We're, we're definitely in talks with like a lot of people about these ideas and, it's, it's just like, it requires a little bit of, not, not lateral, but like just different thinking about- What are the possibilities and like, what can you do now that you have this, this technology? It's like, I don't know, it's, it's, it's like saying, \"Oh, somebody invented, the combustion engine, like what can you do with it now? And you start like figuring out the use for it, right? so a lot of like the, the mainstream, developers and, and gaming, the people in the gaming community aren't really aware of, of, of, the possibilities, but also the limitations, like understanding like what Where are the technical limitations with the technology and like what are the, the, like the paradigm shifts required in like the user experience? And so, w-we're very much like looking at, at that angle to, to kind of like, so The, the, the main objective is to kind of scale the production of, of games, let's say. Like I, I wanna see a lot of games and a lot of ideas and a lot of applications in general being built, on Lightning. so, so we're basically focused on that side of things, is how can we enable that to happen quicker rather than," }, { "speaker": "stephan", "time": "46:00", "start": 2760.25, "text": "Yeah, sure. And look, turning now to Bitcoin and Lightning more broadly, what are you, what's on your wish list for Lightning, updates or technology around that?" }, { "speaker": "lightningk0ala", "time": "46:12", "start": 2771.54, "text": "I used to have the, the sig hash no input hashtag for a couple months last year, then I took it off 'cause nobody was like interested. But, oh, there's a lot, like, Schnorr. Schnorr is like the, probably the biggest one that I'm looking forward to, but, yeah, it's a cash flow input L2, and then on the lightning fronts like AMP, channel splicing, channel factories," }, { "speaker": "lightningk0ala", "time": "46:43", "start": 2803.08, "text": "what else? Oh, availability. Like I think infrastructure-wise, there's, there's a lot of work required in, you know, on an enterprise level, you don't wanna be relying on a single node. Like, fingers crossed, like Satoshi's place has been pretty stable, but it's like, you wanna have redundancy, right? You wanna have, a couple of nodes that you can, fall back on in case, there's a failure, a-and so there's, there's work required on that. There's work required on backups, there's work required on like the dashboard and, system administrator tools. I know a lot of people have been talking about LN Dash and RTL recently. I, I really like RTL, I, I love the, the, the, the work they've done, and I use it for, for my LND node. but it's pretty early, like, there's like a ton of things that I say, \"Oh, you should add this, you should add that,\" and, and, yeah, so the improvement there, Services, you know, swap services, liquidity services like what Lightning Network Labs release, with Loop, yeah, similar to what Fabio Fiorio and what, Pierre Rochard has done, with his liquidity service as well, things like that," }, { "speaker": "lightningk0ala", "time": "48:04", "start": 2884.2, "text": "what else? This is, I'm probably missing like, like, another ten things, but yeah." }, { "speaker": "stephan", "time": "48:11", "start": 2890.87, "text": "Yeah, but I think they're, they're probably some of the key ones that we're looking for from a Bitcoin and Lightning, or more from a Lightning point of view there. Okay guys just letting the audio listeners know this is the point where lightningk0ala and I played a game of lightning chess. I've obviously cut that out just because that won't be very exciting for you as audio listeners. If you want to see that part just go find it on my YouTube channel SLP63. Onto the last section of the audio. Good game, good game. Two hundred taps down. That was a good game. Yeah. So, look, we'll have to, organize a few rematches and, you know, throw out a few, get, get, get people, get the listeners playing some lightning chess, as we've just demonstrated for them. that's how you do it. look, I guess, look, just as we wrap up the episode today, Koala, just tell everyone where they can find you and, you know, where they can go for Ko" }, { "speaker": "lightningk0ala", "time": "49:09", "start": 2948.65, "text": "So, I'm usually on Twitter at lightningkoala with a zero instead of a, an O in koala. And, you can check out lightningchess at koala stud dot io. That's, koala s t u d dot io. and then there's satoshis place, satoshis dot place, for, the, some graffiti fun. that's it. Yeah." }, { "speaker": "stephan", "time": "49:36", "start": 2975.73, "text": "Excellent. Well, look, thanks very much for coming on the show. I think you're doing some really cool work to kind of really show and prove out what Lightning gaming could look like, and it's a really fascinating time. We're just so early, I think in the next few years we're gonna see some really amazing things come out of this whole ecosystem. So, you know, people who are around now, you're, you're definitely early. so I guess just from my end, I'll just say lastly, guys, make sure you, press like, subscribe, share Thanks Stefan. So that's the episode. Let me know what you guys think. I hope you enjoyed it. Also, give me some thoughts on what you think about the mix in terms of technology, economics, and also obviously mixing in Lightning Network content with Bitcoin. I've got a few episodes coming up this weekend, so keep an eye out for those. And then next week, I'm actually looking to try and record my first monologue episode. And that one will be one where I actually respond to the multi-coiner worldview and offer essentially what I believe is the Bitcoin Austrian view in terms of why the maximalist argument makes more sense. So keep an eye out for that one. Otherwise, make sure you retweet and share the episodes. Thanks very much, guys. See you next time." } ] }