Bankless - Is Bitcoin Going According to Plan? Gold, Saylor, Satoshi | Dan Held

Episode Date: July 13, 2026

What happens when rebel money becomes institutional money? In this episode, David sits down with Bitcoin OG Dan Held to ask whether Bitcoin is actually going according to plan. They unpack Bitcoin’s cypherpunk origins, the rise of ETFs and corporate treasuries, Michael Saylor’s influence, Bitcoin’s missed scaling opportunities, privacy tradeoffs, quantum risk, the Satoshi mystery, and why Dan thinks Bitcoin can still flip gold. --- 📣SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium --- BANKLESS SPONSOR TOOLS: 🔮POLYMARKET | #1 PREDICTION MARKET https://bankless.cc/polymarket-podcast 📊BITGET | TOKENIZED STOCKS 2.0 https://bankless.cc/bitget-stocks 🎯THE DEFI REPORT | ONCHAIN INSIGHTS https://thedefireport.io/bankless 👑BANKLESS PREMIUM | AD-FREE & BONUS EPISODES https://bankless.cc/spotify-premium --- TIMESTAMPS 0:00 Is Bitcoin Going According to Plan? 2:39 Bitcoin’s Culture Changed, But Did the Code? 9:06 From Magic Internet Money to Digital Gold 15:08 Michael Saylor, Strategy and Concentration Risk 20:08 Is Bitcoin Becoming Too US-Coded? 24:12 Did Bitcoin Miss Its Scaling Moment? 29:42 Privacy, Cash and Bitcoin’s Tradeoffs 32:15 Satoshi’s Design Choices 37:50 BIPs, Quantum Risk and Bitcoin Upgrades 41:35 How Urgent Is Quantum? 44:14 The Satoshi Mystery 47:38 Bitcoin’s Next Phase of Adoption 49:23 Will Bitcoin Flip Gold? 53:11 Being Early Looks Crazy --- RESOURCES Dan Held https://x.com/danheld --- Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures

Bankless Nation, I'm here with Dan held. Dan is probably one of the most OG Bitcoiners that we've had on the show in the past. Dan, welcome back to Bankless. Thanks for having me. I just kind of want to have a pretty broad, zoomed-out discussion. Dan, you and I have been both in crypto-twitter. You're in Bitcoin Twitter. I'm in Ethereum Twitter, whatever.

It feels like a decade now. It kind of is approaching a decade, at least for me. I think you got into Bitcoin before I came into crypto. I mean, crypto is kind of like dog years, right? Like every year that passes is like seven years. So we've been in the space for effectively about 100 years, you know. Right. It's has certainly how it feels.

And so I kind of just want to ask you, like, if we go back and put ourselves in the shoes of our younger selves, like the 2018s, the 2020 era, is Bitcoin going according to plan? It's kind of the broad premise I want to investigate in this episode. So I'll ask that question to you. Yeah. And, you know, the reason why I said yes to this is I think it's a pretty fun one, both from my perspective as I kind of a Bitcoin maxi. who's been in the space for 15 years,

and also I'd be curious to get your side of this. But I think, let me kind of zoom back all the way to the beginning because I got in in 2011, started purchasing in 2012, but I created my Mount Cox account in December 2011. Back then, Bitcoin is a very rebellious, anti-government sort of mechanism, right? You had people who were into Silk Road,

pure-to-pure file sharing, so torrenting, those sort of, you know, online gamble, The origins of Bitcoin came from a pretty, I would say, rugged place. It wasn't, this wasn't clean, nice, institutionalized, anything like that. So Bitcoin's core ethos I used to joke is, you know, 3D prints of guns, drugs, and Bitcoin. You know, that's what it originally was. You know, came from the cypherpunk slash extropian communities, which were very libertarian meaning. What's interesting about that is, you know, both, that was the cultural values around the Bitcoin code itself.

Right. So you've got the code of Bitcoin, which represents what Bitcoin. is. I mean, it's essentially just the code that runs, right? Across every Bitcoin node, and that's what we all agree upon is the Bitcoin network. That is what Bitcoin is. Then there's the community and culture around it. So that's the old culture. Today, the culture is much more institutionalized. You have Bitcoin and ETFs. You've got top investment banks. You've got, you know, Fed chairmen. You have presidents talking about Bitcoin. You have them referencing it in a positive and negative manner. You know, Bitcoin has largely been institutionalized. And so I think

there's a lot of hand-wringing around the idea that Bitcoin has been captured. That's the original Bitcoin cultural ethos has changed. I do think that's true. So, you know, I'm not going to deny that Bitcoin's cultural ethos has changed a bit. I think a lot of people view it as just another asset in their portfolio rather than truly understanding it. But that's not necessarily a bad thing. People buy a lot of assets that don't really understand them. When people buy gold or the S&P 500, you know, with the S&P 500, I often joke, can you tell me? one of the quarterly earnings of any company, the S&P 500. Most people can't.

But that's fine. So Bitcoin, in terms of the obfuscation of understanding how it works culturally, of course, I wish everyone understood how it works and would keep all their Bitcoin on a treasurer or a ledger, but that's just not how mainstream adoption works. Now, when it comes to Bitcoin's core code, because that's ultimately representative of what Bitcoin is, you know, did we see institutions have any sort of capture of how Bitcoin's core code functions or do they push any changes that were implemented? And we don't see any of those. So from Bitcoin's code perspective, it didn't been the knee. The institution's bent the knee

to bring Bitcoin into it. So I don't think Bitcoin has compromised on its core code values, but the community certainly has changed. And as an OG, I don't mind that. I think this is how institutionalized and mainstream adoption works. I'm a weird libertarian guy who's studied finance during the 2008 financial crisis, got radicalized from that. Grew up in Texas. I own seven guns. I'm not a normal person. This is not normal person behavior.

I'm a weird libertarian, you know, formerly gold bug got into Bitcoin. So I don't expect everyone to have my same cultural values. So, you know, Bitcoin's culture has certainly changed, but that doesn't mean that Bitcoin itself has changed at all. And certainly we would have seen that in the code. Yeah. And I think the purpose or the point of the question, like, is Bitcoin going according to plan, is not really to answer like yes or no, but it's more to like understand the nature of the question itself, I think. And a little bit what I was thinking about hearing you talk just now is like the measuring stick of what success is is really important.

And, you know, we could just like talk naively. It's like, oh, it's the price of Bitcoin. Like that's the measure of success. And to some degree, that's true. And I kind of enjoy that the fact that that's true. but I also, I was thinking about Burning Man as an example where if you talk to people who went to Burning Man in like the 90s and the 2000, like early 2000s,

they look at Burning Man today and be like, like we've lost the plot, what are we doing here? These influencers are everywhere. Like we have Starlings. Like the ethos and spirit of Burning Man is gone. It's failed. But then you look at Burning Man is like there's 80,000 people there and it's growing in energy, and it's shifted.

And this is all always what revolutions do. I think like revolutions moderate as they grow up. And so I don't want to like say that like, oh, the fact that like we are all looking at Michael Saylor and the Bitcoin ETS and we've like lost the plot of not your keys, not your Bitcoin. I don't think that's a fair measuring stick. But I also don't want to lose sight of that either. and I have a hard time doing both. I don't know if you have any reflections on that.

Yeah, this is a, I think this is, I think what you're referencing is what are the KPIs that we would have initially set up to determine, and KPIs, for those who don't understand what that means, it's a tech term to stand for key performance indicators. What KPIs would we have set up to represent the success of the Bitcoin network?

Now, having done this both at Cracken, Uber, and since leaving Cracken, I've had 15 fractional CMO clients. So like I do this OKR KPI process more times and almost probably anyone my age. Setting proper KPIs is really difficult, right? It's not just measuring every single metric we could, right? Because it could be hardware wallet ownership. It could be a private key management,

like how many people are self-custodying their assets. Usually what we try to do when we create KPIs is we try to distill them down to the really core key metrics that represent success. That's why it's called e-performance indicator. It's not a measure. of all metrics. I would say first and foremost, a nice compression of all of those metrics together is Bitcoin's price, because the price represents the aggregate belief that it is a new digital gold

or sound money. So the price is a one-way hash function of all of the collective belief in it, and that's what the price represents. So that, I think, is the number one KPI because price also loops into everything else. It's adoption, it's liquidity, it's resilience, it's narrative, it's all these things combined. So price first and foremost would be probably the top KPI. From there, you know, obviously self-custody is a hugely important issue. So self-custody would be how many people manage their own private key, whether that be you have a dedicated hardware wallet, which would be ideal, or other setup, which there's a pretty low percentage. And it's not too unsurprising. I mean, I've managed my own private key for 15 years, and honestly, it's

pretty stressful. You know, I don't have a multi-sig setup. I do single key because, you know, sitting up a two out of three has its own issues, but I don't want to go down that rabbit hole. You know, private key management, I would say liquidity is also a function of price. Now, how deep is the market? Like, the price could be high, but there's no liquidity. And, you know, if you look across those KPIs, you know, even with private key management, like self-custody, we've seen that improve, but as a percentage of total hoddlers, it's still lower than what I'd want. You know, from there, it gets a little fuzzier, right?

Like if you measure changes to Bitcoin's core code, you know, that would be a function of, it's really subjective. Like, you don't want to be like, oh, we should change it all the time, but certainly it needs to improve. So that's a really fuzzy one. I'm not sure how we can actually measure that.

But yeah, that's kind of my initial foray into how would we measure success. Yeah. He probably prices the simplest answer just because it reflects everything else combined. Markets don't move one asset at a time. One day it's Bitcoin, the next Nvidia, then gold, and then the S&P.

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I think a lot of people who come into crypto on the earlier side of things, like pre-2020, 2020, you have to have come in it for like the ideology. Like it's, it's, you're not just there for the money. Like, you were crazy to be there before 2020. And that's because you were like ideologically motivated, like, or like some emotional motivation to like be in the crypto space either in Bitcoin or Ethereum. and I think a lot of it was like you cited your radicalization because of 2008. And so I think a lot of early bitcoins and like people, like for me, believing in Ethereum,

it's like, I want to change culture. Like, I want to change the world. And now we have this like financial tool to do that. And like what more powerful of a tool to change culture and change the world than with money and finance? And I think that's kind of like the, a potential measuring stick. And an old article that I really liked from Nick Carter, he wrote about how Bitcoin is a peaceful revolution, right? Like you're just demonetizing the nation-state's ability to engage in warfare.

Or that was like one angle. Or another angle is like, it's just like a check-on power of central governments, like inflating their currencies. I don't know if we've been impactful on those fronts. And I know it's early. Like Bitcoin is 15, 16 years old. it's early to say that like, yo, we're like Bitcoin is going to defund violence.

But still, I don't know if, I don't know if there's any hints of success on those like big macroscopic ideas that we once had as an industry. Look, we memes, when I first got into Bitcoin, he was largely associated with drugs and money laundering, right? This is early, early days. I mean, I even went on a date in San Francisco and she said, are you a drug dealer when she asked what I did? So like, Bitcoin's improved somewhat from there.

Sure. Now it's largely perceived as a speculative asset, I would say which is still a pretty negative connotation rather than a positive one and it's like freedom money. You know, culture-wise, like we meaned Bitcoin, which is a fucking random-ass magic internet money, largely perceived as dirty and filthy and bullshit. We aimed that into what was a tiny obscure community.

I mean, in San Francisco, you know, I went to the Bitcoin meetups there in early 2013. It was just Brian and Fred from Quirms. Coinbase, Charlie Lee, Jed McCaleb, Jesse Powell, Jared Kenna, who hosted it at 20 Mission. I mean, there was a dozen of us in a cooler full of PBRs. Like, from that into the president is talking about it and there's a bill in Congress about it and Goldman, JPMorgan are all like, yeah, this is legitimate. And same with the Fed.

I mean, I think we meaned it into an existence where people believe it's digital gold. for me, since that was my original thesis, I think we largely succeeded. You know, does the everyday person see it that way? You know, I think market, last time I checked the surveys around market penetration in terms of what percentage of the U.S. owns Bitcoin. I think it's under 10%,

but I might be making numbers up, but I'm pretty sure it's like 5 to 10%. That's not bad. I mean, we convinced what is the population of the U.S.? Like 400 million? You know, we convinced 40 million people to buy Bitcoin and that's the U.S. numbers, globally. might be bigger. From obscurity of this crazy magic internet money into being semi-relevant,

I consider that as from a marketing standpoint. That's a huge success. 15 years, people don't wake up and wonder, should I shake my core foundations of understanding what money is? Like, you wake up and you wonder if you should buy Chick-fil-A or Burger King. You don't want to wake up and be like, let me question the nature of reality, both my body, God, family and purpose in life, you don't want to go down that rabbit hole. So the fact that 40 million people in the U.S. alone, let's say the 10% number is true, 40 million people woke up and decided to go down the rabbit hole of questioning the nature of the reality. It's so core to them, like what is money?

I think that's success. But yeah, you know, it's still a battle to be won. I think this is a general, you know, I realized a long time ago that this is going to be a generational thing. I don't think the boomers, most boomers, I think, are kind of too far gone. They're too set in their ways. And so as the famous quote goes, science progresses at the death of every scientist. You know, I think like Bitcoin adoption will. Oh, my, I understand that quote slightly differently.

The quote that I have in my head is, science progress one grave at a time. Same, same, I think. Same, same, yeah. Basically, we need the old people to die so the new people can take over. Yeah. But that's not a revolution. That's just time passing. Well, I guess every invention before, though, had the same effect.

You know, after going through this myself with Bitcoin, and then, you know, six years ago, I invested in SpaceX, which had a lot of similar, I would say, like, very, like a lot of intense feelings in a negative manner towards the concept. After going through this experience myself, I really have this empathy for every single inventor or artist before us. Like, can you imagine? Most people were never recognized for their contributions, whether it be science or art, until after they died. Imagine living a whole life like this. At least we were validated that we were right. But imagine living a whole life and everyone is just ridiculing you all the time. It's like Bitcoin and Eath being at super low prices your entire life.

Right. Yeah. You know, at least we had moments where like we definitely had our victory lapse where everyone who was a critic was coming back and saying, hey, you guys were right. So, yeah. And again, like I... said, I have deep sympathy for every inventor or critical thinker or contrary and thinker before us. Yeah. What do you think about Michael Saylor's influence or just role in Bitcoin? Like, I think it's pretty easy to say, like, obviously he's been good for it if our measuring stick is price because he bought $60 billion. He just piled $60 billion into Bitcoin. So how is that not good? But there's also, there's definitely a double-edged sword. And we can talk about that.

What do you think just overall about like Michael Saylor and his relationship to Bitcoin? Yeah. First and foremost, I think he's played a really good critical role in advocating for Bitcoin. I've had a lot of time. I've spent what they met as his place in Miami. We've gone out to dinner quite a few times. You know, there's some funny things as well where, you know, his proof of work, his whole energy memes. You know, he's mentioned before that like, oh, you know, a lot of what I learned about Bitcoin is from Dan. So I've seen some weird after effects of like, I think his take on energy is a little too, cosmic. A little bit esoteric. Let's put it that way.

And so, you know, whereas I feel like mine was a bit esoteric, but more for an easy concept for people to digest, but I didn't go a little, I didn't go Chris crazy with the energy meme. I think he's taken some narratives and I think gotten a little too esoteric with them.

So overall, I think he's in that positive. At the same time, you know, he is advocating ultimately he represents micro strategy. And so at the end of the day, he's sort of not recommending, but advocating for micro strategy. And as, you know, I never got involved in any of the debts. I got offered to be CEO of three of them.

Actually, I don't think it's four of them. You know, I could have participated in them, like buying it early. I didn't do that either. You'd call me old fashion, but if you want to buy Bitcoin, just buy Bitcoin. And I think a lot of people had this whole concept around like, oh, well, what if we get like a leverage play on Bitcoin and whatnot. You know, I don't think that, I think Stretch and Microstrategie, I don't think we're represented in the, you know, most accurate way possible.

I don't think there was malicious intent behind it, but, you know, so TLDR, I'm kind of waxing poetically here, TLDR, I think he's a net positive for Bitcoin. However, I would not have recommended Bitcoiners by Micro Strategy or Stretcher any of those products. Yeah. My concern is about the role of DATs and the success of Dats is just like the centralization of the supply. Like if you tell me like, okay, what if strategy owned half a percent of Bitcoin? Be like, that's great. 1% of Bitcoin.

That's great. 2% of Bitcoin. I was like, wow, that's a lot of Bitcoin. It's that 4% of Bitcoin, dude. And at some point, like, just like as a thought experiment, like what if strategy owned 50% half of the Bitcoin supply. I'd be like, that's too much. That's bad. That's a bad thing. And I bet you price can't really move too much if one entity owns 50%. Now, we're at 4%. So we're very far off. But still, like, it starts to be a little worrisome that there's just this like one dude.

Like the whole like Metcalf's law interpretation of like networks depends on the Bitcoin supply being diffuse. And so I do kind of worry. I, I was. like at one point is there just like too much attention. Not like, there's no risk to Bitcoin because Bitcoin code doesn't care about Michael strategy. So like whatever. But just like the attention and the branding can be like captured a little bit. And that kind of worries me.

What do you think about that? Yeah, I don't think you're wrong that there could be a narrative that would impact price around concentration risk being like, oh, this people just inherently believe more concentration means wealth inequality, censorship. centralization. So you're not wrong narrative-wise, as you mentioned before, though the Bitcoin code doesn't really care. Right? Bitcoin's proof-of-work function isn't a proof-of-stake function. I think in a proof-of-stake protocol, that'd be very worrisome. And a proof-for-work protocol is a little less worrisome. Granted, with someone with that much capital, they could also buy a lot of miners.

But, you know, proof of work basically functions, you have all this cap-ax, you buy these machines, and the only thing these machines can do is print money, which is Bitcoin. So if you buy too many of them and then people perceive the network as being centralized, you would, and then you act in a bad manner, like doing 51% attacks, you would essentially destroy the machines that print the money and you've already spent upfront capital. Proof of work is provably burning capital to purchase machines up front. And so, you know, anyways, even if they had a concentration of the miners, they would have to be willing to burn the money and be willing to destroy all of their invested capital

if they wanted to manipulate the network in their favor. Yeah. Yeah, I don't really think it's a technical thing, though. It's more of like a, it's a, it's back to just like, it's a sociological thing. And it's kind of similar in the sense that, you know, the United States has really planted their flag on Bitcoin and crypto. Like, Bitcoin is, we have a strategic asset reserve,

a strategic Bitcoin Reserve. And like Donald Trump wants to make crypto the capital of the world, crypto capital of the world. And I see like, well, China doesn't give a fuck about Bitcoin. what's trying to buying, but gold. And so there's like a branding. It's like it's not as credibly neutral. It's not as like permissionless and balance and harmonious

across the globe as it once was. And so it's kind of the same thing with the United States planting the flag. Like Bitcoin is just US coded, which works for me. I'm in the US. Bitcoin's also kind of Michael Saylor coded. And that's kind of like that's part where I go back.

That wasn't the plan. That was not the plan. What do you think about that? Yeah. I mean, first, I'm actually quite surprised that China and other, like Russia and China didn't try to buy as much Bitcoin as they could. Right. I mean, Russia right now is dealing with the consequences of that. With the Ukraine war, they've had a lot of their assets frozen. So the fact that they didn't perceive Bitcoin as kind of a safe store value is quite bizarre,

especially with how fluid they could pay their partners with it. You know, I'm not exactly sure why adoption didn't occur there. Granted, you know, Bitcoin is suit anonymous, so we don't know exactly how much the Russian government could own and they could make a very concentrated effort to keep it semi-private-ish and just, you know, have it in a bunch of different wallets and distribute it in a way where we wouldn't know true ownership. But yeah, I mean, for me, Bitcoin is a critically neutral asset. There is a potential negative merit of being associated with both the United States and a certain party. I think the party is more troublesome than the United States being associated with it. The United States has the largest gold reserve.

of the world. So much so that it's larger than I believe, I believe it's larger than every other gold reserve combined, but it's huge. So the U.S. has the largest gold reserves out there. Just because the U.S. believes in gold doesn't make gold a less valuable. And also the U.S. is perceived as still the World Reserve asset. The dollar is perceived with the World Reserve asset. So them adopting Bitcoin, I think is a positive. I think it being Republican, I mean, I'm libertarian, so I dislike both parties equally. But I think that's, I think That could be a negative narrative here in two years or Trump would come, yeah, about two years from now. Three years, yeah.

You know, that could come back to where, especially since Trump, and I find this very distasteful, where he, you know, leaned in to largely pump and dump schemes like Trump foring and all sorts of stuff. I'm like, you know, man, all you had to do is just be a little classy about it. You could have set up partnerships, a venture firm. You've got a preferred terms. you get all sorts of different deals. You could have made your billions in a nice ethical clean way

and instead it's just really grimy with how we did it. So I think that's going to really come back and buy this. There's probably going to be some investigations after he leaves office. So yeah, TLDR, we can't really control how Bitcoin gets adopted

like who adopts it, where, who buys it. So I think the U.S. Association is okay. Trump, not so much. When it comes down to concentration and could answer your first question, concentration in the narratives around that, I think 4% is fine. I mean, it's pretty hard to accumulate a 4% position. It's taken them years, years of constant buying. So I'm not too worried about that, even if it gets to 10%.

I still think 10% in most people's minds would sound low. You know, 40% I agree with you. At those numbers, it just sounds bad. So theoretically, yes, I agree. You know, practically, someone's, been trying to do this. I don't know when he began. Was it five,

five, six years ago? It was right around COVID. It's right around COVID. Yeah, so five years. Yeah. So he's sticking out a long time to get to four percent. Yeah, it doesn't seem like he's going to be buying

a lot of Bitcoin in the short term either. That's on pause. With the trading below par, not part, they're not really good par in the on stretch, but treating below the $100 sort of target price, I don't think is a good omen. Yeah, yeah, yeah.

I want to ask about scaling in Bitcoin. Lightning Network, I don't know what's up with that, but I don't see it anywhere on my feeds at all. Has Bitcoin kind of just like become indifferent to scaling? Yeah, that's a great question. I think it's this one, I'd like to go back to the block size wars. Basically, for those who aren't familiar, there's Bitcoin and Bitcoin Cash, Civil War, Bitcoin broken half, essentially, in terms of cultural community values. The small blockers, which was myself and basically what Bitcoin is today,

we believe that you can't scale Bitcoin completely on the layer one, so you have to scale it in layers. So you have to build its other layers that eventually net settle on the Bitcoin base layer. For those who don't know what we're talking about here. For the L2s, basically the community made a promise that we would push all this economic activity to L2s and that we would foster a healthy L2 to L1 relationship.

I do think Bitcoin, the Bitcoin community has failed in that regard. We could have implemented things like OPECAT, or other very basic scripting functions in the Bitcoin base layer that would enable trustless L2s. Most of Bitcoin L2s have different security assumptions that basically make the process of using your Bitcoin on an L2 less secure than Bitcoin's L1, and we could have made it almost equivalently secure. So I do think that that is a promise that was made back then in a block size war is that we have not fulfilled. And so I would say that's a big mess because we could have had it.

And I think the rise of different other smart contract platforms like Ethereum, Solana and others represent that missed opportunity. I think that the lack thereof of really capable L2s that are anchored really well into Bitcoin's L1, I think because we haven't made those changes happen in the community, I do think, like I said, those protocols represent that missed opportunity. Interesting. Interesting. How do you think what could have that looked like? Say if some of the things that you talked about like O.P. Kat and some of the other technical things actually worked out, what would Bitcoin look like? Yeah, it's a good question. It's all hypothetical, right? Can't really what would have happened. But, you know, if you have trustless bridging, which means you can take your Bitcoin from an L1 and bring it to an L2 and you don't have to trust the bridge, that changes a lot of things. I feel like that security would change a lot of user behavior.

if you're around when they operate with this L2, if they trust, you wouldn't have to trust it as much. There's, of course, zero-day exploits and other functions with an L-2 that you need to be aware of, you know, protocol risk. You know,

I was saying this five years ago, you know, just because it's D-Fi doesn't reduce its risk. A lot of people are marketing D-Fi as, yeah, I've reduced my counterparty risk to zero. Like, yeah, you did, but you also have-

your counter-party risk, yeah. Yeah. Which isn't a bad or good thing. It just, you just need to be aware of it, right? So I think that, you know, with Bitcoin L2s, I think it would have captured a lot of that defy demand.

Bitcoin's L1, basically, that the community is like, well, look, we're not going to do all the fancy cool stuff that Ethereum and Solana can do in the L1. And so, you know, we didn't have really robust L2s. And so I think that, you know, we would have seen Bitcoin's market share in terms of like market Bitcoin dominance metric. I think we would have seen that higher. I think we would have seen Bitcoin absorb a lot of those positive narratives that Ethereum and Solana got around defy, smart contrast.

tracks, you know, that could have floated to Bitcoin, which would I think would have been value accretive to the store of value narrative, like a more useful store of value or a, you know, a digital goal that's more, you know, more productive. You know, those narratives, I think, would have amplified the digital gold. It wouldn't have been distracting from it. So, yeah, I think that it was definitely a missed opportunity. And that's where I think the market capitalizations are both slotted and Ethereum represent that missed opportunity. Granted, those protocols are still a very small percentage at Bitcoin's market cap. So how much of an opportunity did we miss?

I'm not sure. But I do think Defi is the future. Like, seeing Ethereum Defi summer was interesting. Like, as at Bitcoin Maxi, I still appreciated and spent a lot of time exploring why Ethereum DeFi summer occurred. And because A, users want it, B, there's a lot of very basic, primitive, of financial types of financial transactions

that people want, lending, borrowing, you know, staking, lending, you know, different types of other smart contracts or options,

derivatives. These are all productive things. You know, there's a whole host of like, do we need millions of tokens? I don't think so. I don't think that's exactly useful.

But taking an asset like digital gold and being able to borrow against it in a trustless manner, there's a massive amount of demand for that. I'm being able to lend it out in a way that's semi-trustless, you know, I think it's useful. What about privacy?

I can't actually remember if Bitcoin had like a commitment to privacy in its culture. I don't think it did. But nonetheless, privacy has always been interesting to Bitcoiners. What is kind of like the idea of the relationship that Bitcoin and Bitcoiners believe about privacy with regards to the Bitcoin protocol? Yeah, that's a good question because the early community, the word cash, actually means that. So when the Bitcoin white paper was written, Satoshi wrote it for the cipher punks,

which on the cryptographer mailing list. The cipherpunks don't use the word cash to mean everyday transactions. That's a huge misconception. Interesting. I've never realized that. That's crazy. Yeah, because you know, like you had like eCash, hash, cash.

Like, why are they using this word cash? Right. It means a couple different things. It means a one-way function. That means once I make a payment, it can't be reversed. So it's irreversible. That's what a cash transaction is like.

If I pay you cash for your plant in the background, you can't ask for that back unless you want to give it back. Yeah. So it means it's irreversible and usually means that it's private. Between the two parties, yeah. Yeah, that was a big component that the cipherpunks really cared about. Now, Bitcoin is pseudonymous. We don't know which Bitcoin address, who owns which address,

but if we ever de-anonymize, if you've owned an address, then we can trace through the blockchain and probably figure out some of your owners. but it is still difficult. It's not easy and you can do coin joins, you can do all sorts of other obfuscation, no lightning, which is a Bitcoin L2. You know, that channel activity is largely anonymous.

But for the cypherpunks in Satoshi, that was actually a critical component. With the idea that Bitcoin would be semi-private or fully private, that's what the word cash means, not cash in your pocket, not that pay for everyday stuff. Now, Satoshi, of course, does reference merchants and paying for things, but the word cash does not represent that.

because he's writing this to the Cypherpunks. The privacy issue, though, very early on, you know, Satoshi and his writing both on the forums, the peer-to-peer foundation forums rather than Bitcoin talk forums, but also there, you know, he mentions that privacy is a good thing. They want to explore any more privacy. He talks about ZK. You know, Satoshi also had a lot of mistakes that he made with Bitcoin. People forget that, too.

And there's actually a few things that I would consider Satoshi actually missed on significantly. One would be the units. Why 21 million versus 21 billion? I think he was quite bearish. Why 21? I actually never figured out why 21. Supposedly, that's like a computer science thing. The 21 just makes it easier from like floating point number or something like that. It'll be on my plebeian marketing understanding of tech. So 21 is like I guess a more elegant way to do it. But 21 million versus 21 billion versus 21 trillion. I think he wanted to break the dollar parity sooner. And this is. an experiment. He didn't know if it was going to work.

Right, right. I think he was a little too bearish. And that unit bias problem, I do think is an issue. Oh, wow. That's novel to me. Right? Like so I do... Bitcoin is this too expensive. Yeah, everyone thinks Bitcoin's too expensive. So I think Satoshi did make a mistake on that, where he put the dust in it. You think Bitcoin should be like $65?

Yeah. I mean, you probably would have got a more adoption. But maybe it wouldn't have. We don't know. We can't replay time. Yeah. And then he also had a very aggressive issue in schedule. You know, like to produce that many Bitcoin in the beginning, it was very aggressive. It could have been a much flatter trajectory. So. Yeah, I definitely agree with that. Yeah. And you and I have talked about this extensively. But yeah. Yeah. It's, I mean, outside of the security budget, I'll talk about the security budget in a second, but just like, yeah, just like having like so many coins be mined so early. Like, imagine how you could have just stretched the security budget like

four times, 10 times further. Totally. totally yeah we'll touch on that if we want to go out there a little bit later but there's a there's a very clear trade off between auditability and transparency so if it's private we can't audit it as easily which we just saw on zcash literally a month ago that's not the first time it's happened in cache it's also not the first time it happened in bitcoin it happened in bifton however it was before bitcoin was worth a penny it was immediately fixed and you know bitcoin is a very over. Bitcoin is rough code in 2010.

It wasn't like a real protocol. Like not tested, not really. It was very basic. Again, it was before Bitcoin is worth of penny. I think a lot of like Zcash people will bring that up, but it's a false equivalency. Yeah, Ethereum people bring it up when Bitcoiners fud Ethereum about the Dow hack. And they're like, well, you guys did it too.

Yeah, exactly, exactly. But yeah, I mean, one was a consensus change. One wasn't. Yeah, yeah. The Ethereum, Dow hack was like, saying, oh, this theft is bad. The Bitcoin is like this broke consensus that was $21,000. Sure.

I take that point. I take that point. Yeah. So, you know, I would say privacy is, of course, is something I strive for. Like, I think that's a great value to have. But you cannot have perfect privacy on an L1 and auditability. And Bitcoin's core value prop is around the $21 million hard cap being a credible monetary policy. That's why it makes for a good sound money, not its rate of inflation or deflation,

but the fact that we can trust that 21 million will be. be changed or has a high credible, credible chance that won't be changed. Yeah. So privacy is like an application layer thing, not a, not a protocol thing. Totally. And, you know, we look at the market cap as eCashings other coins and they're tiny. So like how much do users truly value privacy? I think it's quite low. Even though I wish from a libertarian perspective, people would care. More people valued it. Yeah. We don't. You know, and so I also wrote about this in 2020. It's called Bitcoin Privacy. Is it the article I wrote in my blog? Let's say we had perfect privacy on ZCAP. or a Bitcoin.

And we didn't have any auditability flaws. Okay, so I spend it on various activities and I buy a house. My house has a title and the title is in my name and, you know, the IRS and various other entities, anyone in public can walk by my house and see how big my house is or small or whatever it is. The IRS can ask me where I got that money from because they can see that I bought a house. and so the idea that you can live in this perfect level of privacy if we just had a perfect private money

I think is a little bit, a little bit ridiculous. Like I think you can't have perfect privacy. If you buy any big items, you know, it's kind of impossible. Right. Yeah. Yeah, if you buy any big items, you're kind of like filling in some numbers on a Sudoku puzzle for other people to kind of like figure out. Yeah, yeah.

And like, yeah, and also, yeah, I think what we're saying and what I understand is like, we enjoy privacy. We enjoy technically strong privacy, but there's a limit as to how safe it is to put it deep into the protocol and we can get privacy elsewhere. I take that point.

In a perfect world, if with no tradeoffs, absolutely. And that's where I find the Zcash folks just so dishonest, where they act like as a, we could just stab it with our finger and we could have privacy on Bitcoin's L1. Obviously, we thought about that.

This isn't like, oh yeah, we're just being, you know, crumudgeons and we're like, no, we don't want privacy because we're all institutional now. No, it's not that at all. It's basically, there's a huge tradeoff and we're like the tradeoff doesn't make sense for us, but you guys go on and do that. Cool. I mean, and then Zcash had that, you know, the flaw in it with the inflation bug and we were kind of largely validated by our concerns. Not an inflation bug, an inflation bug inside of the privacy pool. And so not, not a actual unit inflation bug, kind of an inflation bug, but not, not, yeah, it also. It also,

Ultimately, the number of Zcash remains the same. Appreciate it. But yeah, nuances is hard with privacy, and that's kind of the point, actually. Hey, Bankless Nation, it's David. If you're hearing this, that's because you are listening to the free Bankless podcast feed. Did you know that there is a premium bankless RSS feed? The premium feed has extra interviews that I do for my own personal research and just deeper questions that I want answered about the crypto industry,

questions that I want to answer so I can be more informed as an investor, both at Bankless Ventures and also just in my own personal portfolio too. Also, there are no ads, which means, If you listen to the premium feed instead of the free feed, you'll get about 20 hours of your life back every year because you choose to support bankless directly. So if you're interested in getting extra content all while skipping the ads, or you just appreciate what we do here and want us to keep doing it,

we'd appreciate it if you signed up for bankless premium. And there is a link in the show notes to get started. Cheers to a good 2026. I want to talk about BIPs. What is the current Bips being talked about? And Bips are Bitcoin Improvement Protocol. So this is like for Ethereum people, this is EIPs. the Bitcoin improvements.

What's being discussed in the modern day and age around Bitcoin? Yeah, so, you know, Bitcoin, the BIP is basically in a Bitcoin improvement to the protocol that's proposed. You know, there's a couple floating around, I think, BIP 360s around quantum, like improving Bitcoin to be quantum, post-quantum cryptography, basically solving some of the, you know, with quantum, the current issue with Bitcoin is that, you know, when you sign the transaction with your private key,

that a private key can get exposed. And if it's exposed, those and steal your Bitcoin. And so we have to upgrade Bitcoin signatures to post-quantum secure signatures. Yeah, and we have to pick which signature is the best one, and there's a bunch of trade-offs with each one. A bunch of trade-offs from potential zero-day exploits

to large byte sizes. Overall, anything post-quantum is going to be a little much larger in bytes, aka data size. So that'll make Bitcoin transactions more expensive. Certainly opens up another conversation around Bitcoin block size, though. Yeah, I'm kind of okay with that, actually. I think I was having this debate with Ryan where Ryan was like, oh, yeah, Bitcoiners are going to need to increase the block size. I'm like, I don't know if they do. I think they can just pay the fees. Do you have an opinion on that?

Well, block space currently isn't super busy, so you could probably do the fees. But, you know, in a theoretical world where like a lot of people are trying to do it out once, blocks has increased may be necessary, but that's a whole can of worms. But anyways, any post-quantum secure, any post-quantum encryption that we select will likely be for larger in bytes. There is some improvements that are like magnitude shifts. And I think that's some of the criticism that some folks have is that, you know, we shouldn't make these changes

until we, you know, basically have much more data-dense transaction types or not data-dense, but just and more efficient. So it's BIP-360. There's a couple other proposals as well. There's also kind of a retarded one called Bip 110, which I don't know if you've seen those voices. I don't even know if you even see those people on crypto Twitter because the nature of Twitter has changed a lot.

Yeah, it's very bubbly these days. Yeah, that in like, I feel like we were all part of the same conversation before and now kind of gets a bit more convoluted. So yeah, I would say Bip 110, basically a bunch of these moronic plebs believe that, you know, we should censor Bitcoin because, I was wondering if this was still relevant. Yeah, okay. So this is the arbitrary data.

Do we allow arbitrary data in Bitcoin or not? These idiots don't understand how computer science, aka information theory works. You know, these are very uneducated. Aren't some of these idiots core devs, though? No, one. There's one core dev. It's a super religious guy?

Yeah, he believes that the Catholic Church has perverted Catholicism. He believes in eating cats. He also believes all sorts of crazy shit. But he's okay. So we don't take him seriously anymore. No, no, he's a lunatic. And so you got a lunatic and a bunch of uneducated plebs that are behind him. Right.

And they're like, Signal for 110, you know, so they're kind of shouting right now about that. And literally every minor and every business is like, what the fuck are you doing? Like stop, stop being weird. Yeah, stop being weird. And so you might actually fork off, which would be great. Great, great, great. Let them. I hope they do.

I hope they do. Please. Exactly. So Bip 110 is a joke. 360 is like being considered slash talked about a little bit. But there's nothing I would say in the immediate short term. That's kind of like. Sure.

What's what about the like the level of urgency around the quantum bit, Bip 360 or just like how fast things are progressing? Because there is like a level of urgency around quantum, right? Yeah. I would say this is the biggest unresolved question. And I would say most pressing issue in Bitcoin. Pressing doesn't mean it's an immediate concern. pressing as in we need to have, I'd say, some forward momentum.

Yeah, we need, we, the foot needs to be on the gas. Exactly. I mean, you know, Nick Carter obviously has been, been kind of ringing that bell a bit. I do believe that we should be making actions now or progressing towards a solution. I don't think the threat's imminent, even in some of the most aggressive timelines for, you know, quantum, you know, quantum, yeah, or what do they call it? The queue events or something like that. Q data, yeah. I think it's still five years away probably at a minimum.

But even then, it still might take us quite a while to agree upon how we upgrade and in the process of migration. You know, if every single Bitcoin address wanted to move over to a post-quantum secure encryption standard, it would take significant amount of time. So, yeah, this needs to be figured out, I'd say soon in the next couple of years it would be great if we had consensus over the next direction. And then we have actions happen in like year three. I think that would be like an acceptable or good timeline in my book. I think the big concern was that it wasn't being taken seriously as an issue broadly by Bitcoiners. Is that still true? Or do you think everyone has kind of realized that we have to take this head off?

I think that's where like I respect Nick, but I think he definitely kind of exaggerated the level of apathy. It was largely talked about in most circles I'm a part of. I think the only disagreement was the level of concern. Like how soon does this need to be resolved? I think it's the bigger question. And Nick was kind of raising the alarm, which I applaud him for his efforts. I also think he was a bit too critical of various efforts that were going on. I don't think people were just like, oh, this isn't a problem.

I think it was more of like, it's going to be a problem, but it's going to be a little while from now. I think game theoretically that given how advanced AI is getting, that the AI coming up with solutions to make quantum computing more effective will likely lead to its adoption sooner than later. So I do think that five-year timeline, while previously was considered extremely aggressive, I think is a safe one.

I think even with AI breakthroughs on, you know, building quantum computers, I still think five years would be pretty aggressive in terms of when we think Q-Day might occur. Dan, did you watch the Finding Satoshi documentary? I did. Yeah. Do you, like, agree with the conclusion?

You know, I'm kind of a Halmaxie, like Hal Fini maxi. Sure. To be embodied. I think you can be and also still agree with the conclusion. So the documentary, we had them on the podcast for listeners who didn't watch. In my opinion, it kind of does the best job that I think will ever be done about investigating Satoshi and comes to a conclusion that it's both Hal Fidney and Len Sassman. to me, the addition of Len Sassman was the curveball.

Sassiman was the curveball. But my opinion is that I don't think we're ever going to have a more definitive answer than this. Maybe that's what I'll ask you to qualify or disagree about. Yeah, what's interesting is that I had a question posed to me once. Given more and more time, will it become more or less likely that we find Satoshi? Which I thought was super interesting. And I think it's more likely we would have found him sooner. and I think the more time that progresses,

it's less likely that we find him. Even though our ability to analyze his text and look at all the data we have becomes better with AI, there is data decay that is occurring. Emails, written communication, logs that are slowly being deprecated and or erased,

that would have been help us definitively find who Satoshi is. So I would say like the lens, the Lin-Sassam and Hal Finney connection, I thought that was an elegant, good narrative. I don't have any strong. opinions for or against the argument. It's certainly a lot better than the New York Times one about, oh man, that was so bad. Adam back. Yeah, that was just so, so bad. Adam back is definitely not Satoshi. So, yeah, I would say, like, how funny, it definitely feels like how

how funny wrote the code. It, how Fannie fits the bill perfectly for who Satoshi is. And the idea that Len, Len Sassiman wrote the white paper. I mean, the idea that, like, how Fannie couldn't write a white paper though. That seems a little weak. The idea that he had to bring in Len Sassiman for that. Yeah, maybe. But white papers aren't exactly rocket science. Yeah. Do you think identifying Satoshi does that do anything? Or is this just a fun game? Well, I don't want it. I don't think we should know who Satoshi is. It's a fun game. But it would be negative if we definitively found who Satoshi was because one, it creates, you know, this basically deity now because, because it's a lot, becomes a cold, hard, real person.

Right. It pops the illusion. Yeah, and Satoshi's whole purpose of creating the pseudonym was to be, you know, a pseudonym, is to be, you know, someone who wasn't, there wasn't a physical representation associated himself with this. It was more of a, I am an individual, I've done my contribution, and now I'm gone. Versus you should look up to me, you should, you should ask me what to do next. He didn't want to beat that. And so I think it wouldn't be good if we identified who he was. It is still a fun game, I still try to attempt to identify Satoshi as, but I don't think it'd be good for the protocol to know who he is, but I don't think it'd be ultimately that much detrimental.

Satoshi is likely passed away, and if that's true, then he doesn't really happen. He's say over future direction of the protocol. Four-year cycles, we seem to be doing them, but I kind of want to look at what happens in the next four years, like 2028, but then even into like well into the 2030s, like the medium-term future of Bitcoin. We got Bitcoin treasuries, corporate treasuries. We got the Bitcoin Strategic Reserve, some huge wins, some huge dubs for Bitcoin. What kind of wins does Bitcoin, do we want Bitcoin to get in its next phase of growth?

Yeah, I mean, both further, I would say, market penetration of how many people own Bitcoin. Like, that's a really important KPI for me. Like how many people across the globe as a percentage of the population own it. Whether it's $100, $10, or a million dollars, it doesn't really matter. Because then... Does it matter how? Like if it's an ETF, does that matter? I would prefer to them do self-custody, but it doesn't really matter. They can do not self-custody, and they still, by buying Bitcoin, they have bought into this new financial system, this new belief in Bitcoin. And by believing in Bitcoin, it does make it more real. And it's all a shared aggregate illusion. That's what all money is, both gold, the dollar and Bitcoin. And so the more people that buy into the concept of it, the more it has Lindy, the more it longer it'll stick around, the bigger it will become. It's a network effect. It's like a social network, but for money. So the more people that buy into it, the better.

It's like a social network where you can plug directly into it or you can use an app to go access it. Either way, you're buying into this new system, which further disenfranchises you from the existing system and ultimately brings about Bitcoin success, a global reserve asset or like a new global money. So I do think buying it, even an ETF is good. It's certainly not negative.

It's good, but it's not as good as self-custing it. Do you think Bitcoin flips gold? Over a long enough time period, yes. Like a lifetime or like a couple decades? Well, you know, it depends on the growth rate, right? Like 15 years, we went from zero to 1.5 trillion. I do think what was nice about gold's recent movement is it showed that large market cap assets can still have huge volatility.

So there was an argument to be made that like Bitcoin would never have such large movements ever again because like large market cap assets don't move that much. SpaceX, Bitcoin, Apple, I think very much prove that wrong in gold. So, yeah, I do think Bitcoin will eventually flipping gold. I think that's probably at least 10 to 15 years away. You know, it requires more people to believe, at a fundamental level, what the market cap represents is do people believe more in gold or more in Bitcoin? And like I said before, this goes back to a generational divide over, you know,

world boomers adopt this as they die off, millennials and Jin Xers bought into Bitcoin a lot more. We start to set policy for different sorts of institutions, both banks and the Fed, etc. Treasury. So through these, I'd say gradual lifetime sort of generational adoption cycles, that's when we should see gold flipping with Bitcoin flipping gold. I mean, gold is a pretty boring asset. Dominique Gen Xers, Gen Z, and millennials buy gold. I mean, it's considered. to the kind of a boomer thing. So as boomers, which are basically the only gold bugs left, as they die off, I do see gold's value or gold's perception of being a, you know, store value assets

slowly fade away, especially as well with SpaceX. SpaceX as Starship program improves and the tonnage that goes to space improves, there will be extremely credible opportunities to mine asteroids and return that gold back to Earth in a way that is economically doable. All gold on Earth is from asteroids. So, you know, the once we see that become more tangible and people start to price in that future expectation of asteroid mining becoming real,

then gold really has a crisis of faith where its supply becomes largely irrelevant. That will happen in our lifetime. So that's where I think 10 to 15 years is when we see the slipping end of gold because that future expectation of 30 years from now starts to get priced into today. I don't think a lot of people really rock how big starship will be. in terms of basically what he's doing,

what Elon's doing is he's mass-producing spacecraft at such a huge scale that space travel will be as reliable and as cheap as airplane travel. I mean, the consequences of that are so enormous, and when it comes to gold, it's a very detrimental consequence. Because with gold mining, you know, on asteroids, you know, one asteroid,

I forget it has like four quadrillion dollars worth of precious metals, you know, just harnessing one of those asteroids would essentially, and all you have to do is land a, you know, a small craft that has additional thrust and it can slowly push that asteroid towards Earth.

And we make it crash into Earth? No, you just push it to Earth or orbit it make it a little bit. Oh, okay, yeah, because you can't make it crash into Earth because then it's kind of a free-for-all. But I can't imagine what will happen is when you land either, you can either land mining craft on the spaceship. or sorry,

minecraft on the asteroid or you can push it into an orbit and then work on it. But once that happens in any sort of tangible manner, I bet gold drops 25% to today. You know, like that's, that's going to be a death sentence for gold.

Anyways, I've been talking a little bit too long. I remember when the Winklewey went to Dave Portnoy's house and they were trying to show him on Bitcoin. This was during COVID, I think, right after COVID. And like they were pitching this like gold asteroid mining to Dave Portnoy

and they were doing a terrible job. And David Portnoyneux was so turned off. But that was like six years ago. Because it was like so absurd in sci-fi and crazy. But that was like six years ago. And for some reason, I'm listening to you now. And like, this is now we have AI. SpaceX is capturing rockets with chopsticks.

It doesn't seem that far fetched anymore. Totally. Yeah, I mean, I saw the first Starship launch in person. I bought, SpaceX before they built a Starship program. So that was my original faith, my risk, was that they wouldn't be able to execute on that. They did.

It's pretty cool. I mean, I recommend that everyone go see it because it's, you know, a lot of the things that I grew up watching sci-fi-wise are coming true. And that's one of them, space travel. So,

yeah, I mean, look, if Elon's right about this, which is pretty damn right, like this, they did it. Like the internship has been built. They caught out with little chopsticks.

You know, it's pretty wild. So I, you know, you're right that sometimes being early is the same as being wrong. And if you're really, really early, you look like a lunatic. Yeah. Yeah. Yeah. Dan, this has been great.

Thanks for coming on the show and talking to me. I appreciate your perspective on stuff. Yeah, been too long, David. Glad to get out. Cheers. Bankless station, you guys know the deal. Crypto is risky. Bitcoin is risky.

But that's what we're here for. You can lose what you put in. But this is Frontier. It's not for everyone. We're glad you were with us on the bankless journey. Thanks a lot.