BTC Sessions - OKEx Hack, Become The BTC 1 Percent, Coinbase Core Dev Grants EP108

Starting point is 00:00:16 Wasabi wallet and fairly private. What's up, everyone? I'm Ben with the BTC sessions, and this is your daily session. Hodel their Bitcoin. Before we dive in, I want to give a shout to to sponsors of the show, leaden.com. This is where you can use your Bitcoin for a variety of different services. Of course, they have their Bitcoin backed loans.

Starting point is 00:00:49 This is where you can use your Bitcoin as collateral to get a Canadian or U.S. dollar loan. So if you're in a pinch, you need dollars, but you don't. Don't want to sell your Bitcoin because, one, that's a taxable event. And two, you're worried about having to buy back in at a higher price point. This could be for you. Secondly, they've got their Bitcoin and USDC savings accounts with interest rates of up to 11.7% annually paid monthly. And they've got their B2X offering, which uses the same loan mechanism to immediately buy you more Bitcoin, effectively doubling your Bitcoin on the spot.

Starting point is 00:01:20 So if you want to check these guys out, there's a link in the show notes down below. If you click it and you opt to get a loan, well, they will give you $25 directly into your USDC savings account. And up next, we have our friends at Crypto Cloaks. If you have not heard of these guys, they are awesome,

Starting point is 00:01:48 a bunch of awesome bitcoins ers pumping out swag with their 3D printers. And these guys have been just on a tear lately with some great stuff. I've got my Bitcoin node back behind me. I did a video on Umbro the other day with it. But these guys make a little bit of everything. In fact, they just put together this new Triton case, which allows you to put in a couple different raspberry pies and it has swappable face plates.

Starting point is 00:02:11 Really, really cool. They've got their Bitcoin grenades, the Honey Badger Shelf where you can store your hardware wallets. They've got cases for your hardware wallets, coasters, nightlights, a little bit of everything. The new Citadel flag, long and short of it, they've got a lot of awesome stuff. So head over to Cryptocloaks.com. check them out. And if you want 5% at the checkout, use BTC sessions as your code. And that'll get you 5% off. With that last one here, we have the Kobo Vault. And I have done a video on this as well. I've done a full tutorial. This has moved into one of my regularly used hardware wallets. I use it

Starting point is 00:02:50 quite common every few days I'm on this thing. So it's 100% air gap, meaning that it never actually gets plugged into any internet connected device. Everything is done via QR code, keeping your funds safe and offline. They've got open source firmware. They've got a secure element and they're interoperable with all my favorite Bitcoin wallet. So you can use Bitcoin Core, Electrum, Wasabi, which is my go to on desktop and Blue Wallet, which is my go to on mobile. And hey, they work pretty well with multi-sig as well. So be sure to check them out. KoboValt or cobo.com rather. I am using the KoboValt Pro for reference. That one has the fingerprint scanner and the rechargeable battery. So check them out. And also they're doing a giveaway every show from now to the end of the November. All you need to do,

Starting point is 00:03:38 retweet the show, share it out, tag myself and Kobo. Let us know why you want one of these tablets, which is a steel tablet to store the backup to any Bitcoin wallet you may have. With that, let's dive into the news. So OK Exchange has suspended withdrawals. So what's going on here? This from Decrypt, OK Exchange, one of the three biggest exchanges serving Chinese retail investors suspended withdrawals. The exchange reported that a keyholder, quote unquote, had been detained by investigators. China has been cracking down on OTC shops as of late. The price of Bitcoin did take a plunge of more than 2.5% on the news before starting to recover. So a little foggy here what's going on, but this quote from them,

Starting point is 00:04:26 One of our private keyholders is currently cooperating with a public security bureau in investigations where required. The company said in a statement, in order to act in best interests of customers and deliver exceptional long-time customer service, we have decided to suspend digital assets and cryptocurrency withdrawals as of October 16th at 11 o'clock Hong Kong time. We assure that OK exchanges, other functions remain normal and stable, and the security of your assets at OK Exchange. will not be affected. Yeah, so they handle around $6.8 billion in volume and yeah, lots of rumors

Starting point is 00:05:06 about this. Now, we have some news to the contrary of what they say that funds are safe and this is speculative at this point, but over at GlassNode blockchain analytics, they said prior to the suspension of cryptocurrency withdrawals from OK exchange,

Starting point is 00:05:23 we observed large BTC outflow from the exchange. According to our data, a total of 10,000 Bitcoin or around $113 million were withdrawn in two large batches in the past 48 hours. Yeah, so I mean, there are regularly large inter-exchange movements of coins, so this could be that, but the timing is suspect. So while we don't fully know, the takeaway from this is, that you should always, always, always be careful with your Bitcoin. And if it's not your keys, it's not your coins. So keep that in mind if you are ever on an exchange, get your coins off there unless you absolutely need to be using them on the exchange or the custodian for a purpose

Starting point is 00:06:14 and mitigate your risk by minimizing how much is there. Moving on, this article from Decrypt. I had fun reading this one. How much Bitcoin does it take to break into the 1% club. So they're talking about the 1% like the elite 1% the top 1% of Bitcoin holders. So the Bitcoin 1% club refers to the top 1% of Bitcoin holders worldwide. It is hard to determine how much Bitcoin you need to be in the 1% club since Bitcoin isn't evenly distributed among addresses and there are many lost Bitcoin. And estimates for the threshold range from 0.28 BTC, not bad, to as high as 15 BTC, which is substantially higher. Yeah, so they're talking about what does it take?

Starting point is 00:07:06 You know, during the global recession in 2008, there was a lot of discussion around the elite, the 1% that, but the 1% in that instance happened to be closest to the money spigots where they get the inflows of new cash, and thus you have this cantillon effect where the rich get richer and the wealth gap continues to grow. Whereas with Bitcoin, that's not really the case. Just because you own a lot of Bitcoin, it doesn't guarantee that you'll get more

Starting point is 00:07:39 and you'll continue to be more and more wealthy in comparison to the rest of the world because since there is no influx of new capital and your percentage of global wealth can't inherently grow just because you already have wealth and you're up at the top in that realm. Effectively, if you have Bitcoin and you want to enjoy that Bitcoin in some way and better your life in some way, eventually you have to spend it on goods or services. Yes, you can build your Bitcoin stack from creating something, a good or a service that people want.

Starting point is 00:08:19 like, but just from being wealthy, you can't grow. And if you do create something that people like and want to spend money on, then you know, you deserve that wealth, but you're not getting richer just because you're rich. So with the calculations here, again, the numbers that they threw out, at the time recording this video, on the low end of that like 1% number, 0.28 Bitcoin, it's getting close to around $3,200 to be that global elite 1% Bitcoin. Hoddler. Now, again, that's on the low end. So if the higher end is closer to the 1%. 15 Bitcoin will run you about 170,000 US dollars right now. So, depending on how optimistic you are about things, maybe 0.28 is achievable for you. 15, if you're just getting started, that's a ways off.

Starting point is 00:09:15 But again, don't look to, don't look at that number in too much of a pessimistic way because in a world where you have a currency that cannot be manipulated and inflated. And then that inflated currency go to people at the top. Even having a small amount of Bitcoin, you can stake out your claim on a specific percentage of global wealth. and nobody can take that piece of the pie away from you if you don't choose to give it to them. So yeah. And just as a reference, if we take the total global population of around $7.8 billion, we divide it up amongst everybody in the 21 million Bitcoin that will ever exist. Not paying attention to the fact that probably a couple million Bitcoin have been lost at least. if you were to divide that up evenly, each individual would get 0.00269 Bitcoin.

Starting point is 00:10:20 That's about $30 at this point. So if you want to be on par with everybody on the planet, owning about 30 bucks where the Bitcoin will do you. Anyways, let's move on here. Coinbase is to support Bitcoin developers with a new community fund. So Coinbase has launched, this is from Decrypt, by the way. Coinbase has launched a crypto community fund to award grants to developers. Initially, the exchange plans to award at least two grants to Bitcoin core contributors.

Starting point is 00:10:52 Square Crypto and Bitmex are among other firms that support Bitcoin developers. And while I was working at Bitsi, obviously they did another grant for the guys at BTC Pay Server. So it's nice to see. As much as I do not like Coinbase, it is nice. to see that they're supporting Bitcoin-specific developers, because to my knowledge, they haven't really done a lot of that as of late. In fact, they seem to be a little Bitcoin-averse. They tread heavy into shit-coinery.

Starting point is 00:11:24 Anyways, let's read a little bit more deeply here. San Francisco-based cryptocurrency exchange Coinbase is the latest crypto firm to help support further development of the Bitcoin Core Codebase and related projects today announcing the creation of a new fund and a search for potential grant recipients. The Coinbase Crypto Community Fund aims to further build the crypto industry by supporting the developers who are helping to boost the infrastructure behind it, starting with Bitcoin Core.

Starting point is 00:11:53 The company is currently looking to provide grants to at least two developers and may eventually expand the initiative beyond that initial focus. And the quote here, unlike most cryptocurrency projects, Bitcoin launched without a fundraise, bootstrapping an entire industry. The open source community has provided critical support for Bitcoin development and in some supported, with some support from donations from industry organizations and academic institutions. Our goal is to similarly support developers who are committed to growing and maintaining the Bitcoin ecosystem. So, in that respect, kudos to Coinbase for doing such.

Starting point is 00:12:36 Now, contrarian view, I love that Matt O'Dell tweeted this. Contrarian view from Matt O'Dell. We were told Coinbase had to sell surveillance software to government agencies to, quote-unquote, recoup costs. But they apparently have enough money for generous employee exit packages and Bitcoin development funding. Tush. Tusha. Now, in the same vein of Coinbase news, Coinbase gets a lot of data requests from feds, mostly the FBI, and this is a transparency report provided by Coinbase. So, again, Coinbase today published a transparency report outlining how law enforcement requests information about its 38 million customers. The Sanfran Base Exchange disclosed that between January 1st and June 30th of this year,

Starting point is 00:13:35 law enforcement requested information 1,914 times. 96.6% of these requests concern criminal investigations. For context, that's more than double the amount of law enforcement requests received last year by competing U.S. Base Exchange, Cracken. These requests come in the form of subcommittee. subpoenas, largely, but may also include search warrants, court orders, and other formal processes, said Paul Greenwald, Coinbase chief legal officer. He said they are restricted from disclosing some of the information requests we receive. So, 58% of requests were from

Starting point is 00:14:22 U.S. law enforcement, U.K. was 23 percent, Germany was 9 percent, and European authorities made up most of the rest. Within the U.S., FBI was about 30 percent, homeland security was 16 and a half percent, state and local police was just over 16 percent, the DEA was around 9 percent, and the IRS was just shy of 9 percent. Yeah. So, just so you know, if you use a centralized exchange, there are people looking at that. Now, a lot of this, they said this is in relation to criminal cases. So potentially, you know, money laundering, drugs, terrorism, whatever. But just know that there could be requests outside of that later on. So if you're uncomfortable with that, then you can always look into more decentralized methods of obtaining Bitcoin

Starting point is 00:15:19 like using BISC or Hoddle, hoddle, things like that where it's more peer-to-peer. Moving on to more kind of the techie side. So Unchained Capital announced that it is now supporting Cold Card. Unchained are the guys that do multi-signature vaults, and they up until now had only supported Ledger and Treasor, but now they do support the Cold Card, which is awesome. I love the title of the blog post is now Cold Card,

Starting point is 00:15:48 because everybody always tweets when cold card when cold card anyways they from their blog post we're thrilled to announce the day has come cold card devices mark two and three are officially supported for unchain capital vault and loan clients to secure their bitcoin uh cold card is the first partially signed bitcoin transaction wallet the first air gap wallet to gain our official support we're big fans of coin kite um and the products they've built and so are our clients if you've been waiting months for this moment, check the step-by-step guide to get your vault created right now. Now, these guys are only supporting PSBTs, meaning partially signed Bitcoin transactions, meaning you cannot plug your cold card into a computer to approve a transaction.

Starting point is 00:16:36 It has to be a partially signed Bitcoin transaction done via SD card, thus air-gapping your device, so it's never connected to the internet, thus giving you more security. Phil Geiger did a little tweet storm on how to do this the other day. This is not yet implemented for Caravan, which is their open source free to use self-custodying multi-signature thing that I did a video on, but that is coming down the pipeline pretty soon. So they said, what's next? We're not done with Cold Card and the Coin Kite team. We'll be adding Cold Card support, air gap, all.

Starting point is 00:17:18 again, to Caravan for Trust Minimized External Recovery from Volts and Loans. And while we won't be adding any new hardware device support immediately, we'll be busy researching other partially signed Bitcoin transaction-centric devices to add in 2021, as well as QR code transactions for partially signed Bitcoin transactions. That leads me to believe that they may be looking at Kobo Vault, which I'm I would love because, again, Kovalt is air-gapped in QR code. The other one that may be a possibility, but it hasn't dropped yet, is foundation devices. Maybe they're looking at that.

Starting point is 00:18:00 Outside of that, I don't know that there's any others that are kind of big enough or have enough eyeballs on them that would warrant unchained diving down those roads. But maybe I could be mistaken. Either way, super awesome, very excited to see further cross-compatibility with stuff like this. Now, moving on in the same realm of hardware wallets, Trezer introduces Treasurer Suite Public Beta. So what is this? This is a desktop app. It's a reimagining of the way that you interact with your Treasor device.

Starting point is 00:18:38 So you can have a desktop app or there is a web interface that will be used or rather a web app. This will replace their current web interface with which you interact with Trezor, but not yet. It's still in beta. They're fine-tuning a number of things. You can try the beta out, but again, it is still in beta, so expect some bugs and some issues with it before the final release drops. So they said, why desktop wallet? Taking the wallet interface out of the browser eliminates the risk of fishing sites, tricking

Starting point is 00:19:14 users into providing their seed or other information. A desktop app provides more robust protection and reduces the number of mistakes or exploits that could result in someone losing their keys or coins. I agree. It also sounds like they're doing a little bit of catch up to what Ledger has done. So Ledger has had Ledger Live on desktop for quite some time. They also have a Ledger Live app that supports the Bluetooth functionality with the Ledger NanoX. And later, Leder has been making a push to include better features for Bitcoin specifically, namely UTXO management, so coin control, being able to see the pieces of Bitcoin in your wallet, as well as connecting to your own node.

Starting point is 00:20:03 And so hopefully Trezor does a push towards stuff like that as well. Both of these companies got into a lot of, hey, we're adding X number 100. hundreds of coins and tended to disregard a lot of features that came along with Bitcoin, now they seem to be focusing at least partially a little bit back towards Bitcoin and, you know, seeing that does make me happy. So let's hope that Trezor goes down that road. Can't say for sure, but I do like the move from web interface to desktop app. I think that's a positive thing in general. For myself, I don't use either of the dedicated. I tend not to use dedicated apps for any hardware wallet because I prefer to use something that's fully featured in the first place. So something

Starting point is 00:20:52 like Wasabi Wallet on desktop or Blue Wallet on Mobile, I just find I get more of what I need out of those as opposed to having to navigate something that may not be fully featured. And speaking of desktop wallets that are fully featured, there's a new drop of Electrum. So it's version, what version is it? 4.0.4. And one new feature that they added is cancel transaction. And so this is if you send out a transaction that uses RBF, which is replaced by fee, a feature that allows you to bump the fee on a transaction if it's taken too long to get through,

Starting point is 00:21:33 which is very convenient because if you set a low fee, then maybe it gets through in the time frame and you don't really care, but if you end up being in a rush, you can expedite that and pay a little bit more. So with the cancel transaction, effectively what you're doing is you're saying, okay, I've sent this transaction out. It has not yet been officially confirmed on the Bitcoin blockchain. And then on second thought, you know what? It hasn't confirmed yet. I'd rather not. I'm just going to cancel that. Or maybe I need to adjust the amount. Well, you can cancel that. And what it effectively does is it takes the same coins.

Starting point is 00:22:09 It double spends them. So sends out this transaction for the same coins that you just spent, but that have not been confirmed. And attaches a higher fee, but pays those coins back to one of your own addresses instead of to the address that you had originally sent it to. And so, again, it just allows you to cancel transaction and change things around if it has yet to be confirmed. This is also why it's important to never accept an unconfirmed transaction, especially if it's for a larger amount. If it's a smaller amount, it's like five or ten bucks, whatever I'd say. But better to use something like Lightning Network for smaller transactions anyways, because it's instant and nearly free. So yeah, cool to see.

Starting point is 00:22:57 And finally, in the last kind of little bit of techie related Bitcoin stuff, Schnor and Taproot Upquist, proposal has been merged into Bitcoin Core. So what are Schnor and Tapru? Schnor is an alternative algorithm to ECDSA, which is currently used to generate cryptographic signatures. Schnor signatures would enable the flexible creation and execution of multi-sig transactions like the ones created with Caravan by combining signatures. This provides added privacy because multi-signature transactions would become indecision. distinguishable from regular single signature transactions. Now, Taproot is a specific method in which the Schnorr signatures will be leveraged to realize

Starting point is 00:23:44 a privacy-preserving smart contract solution. It was first proposed by former Blockstream CTO Greg Maxwell in the Bitcoin Dev mailing list. Since then, several iterations have taken place leading to the pull request that was merged today. So basically, this helps with privacy. it also helps with the size of multi-sig transactions, cuts down a little bit on those types of fees and stuff. Now, what comes next is figuring out how to activate it. So ever since 2017, when we activated Segwit, there's a lot of issues with that and the way it was activated in that a small number of miners were able to effectively step in the way and kind of hold the proposal

Starting point is 00:24:28 hostage until people figured out some workarounds. this way i mean if anything it's kind of led to a situation where people are more closely considering how they're going to deal with this so there's a couple um considerations on the table one is called bip eight which is an activation of taproot after signaling period for minors which was the way that uh bip nine worked for siguit however um bip nine was required to 95% of minors. This one does not have that. So that attack vector is potentially removed there. Now, the other one is called modern soft fork activation. It's a significantly more complicated and extensive method for activation. It allows for a 12-month signaling period followed by a six-month

Starting point is 00:25:23 discussion period, as well as the potential to initiate a BIP-8 kind of minor signaling method over a 24-month period. So like we're getting, we're talking about years. So don't expect this to be like, oh, it's activated on Bitcoin right away. Like maybe if we're lucky, it might be in before next Christmas. But this is, this is how Bitcoin development goes. It's very slow. It's very calculated. And I mean, they're dealing with a potential replacement for the global monetary base. You get one shot at this. If we fuck this up, that's a major problem. And that's why this approach is so careful. Other projects have that move fast and break things attitude. Bitcoin most marketly does not. And I am totally fine with that. The last thing I wanted to touch on,

Starting point is 00:26:23 I'm going to be a little bit cryptic here. I have a big announcement and I'm very excited about it. And I made that announcement. I'm not actually doing it here. I'm going to encourage you guys to go listen to some other awesome Bitcoin content in order to get that announcement. But it's in these shoutouts on Tales from the Crypt with Matt O'Dell and Marty Bent. It's about 20, 25 minutes in, but very, very happy about the shoutout. Thanks for Marty reading it out and the kind words from both Marty and Matt over at TFDC. but it's some pretty bullish news, I think.

Starting point is 00:27:03 I think it's more bullish than the Michael Saylor Micro Strategy News when they bought 425 mil. So yeah, I encourage you to check that out. If you do listen to it and you hear it, let me know. Anyways, guys, I'm going to wrap out there. Thank you so much for watching and or listening. If you are here on YouTube, please do hit like, subscribe, and share.

Starting point is 00:27:25 All of those things are very important. They really do help. If you want to help out the show in another way, you can hit up the sponsors that I mentioned down below. That was Ledden, Crypto Cloaks, and Kobo Vault. Don't forget to retweet the show if you want to win one of those steel seed plates. And if you really loved what you saw, you can always hit up my tippin.combe page with a lightning network tip. That is t-i-p-p-in-me. slash at BTC sessions.

Starting point is 00:27:53 With that, I'm out. Have yourselves a wonderful day or a wonderful evening wherever you are. and you'll see you next time for your daily session.

BTC Sessions - OKEx Hack, Become The BTC 1 Percent, Coinbase Core Dev Grants EP108

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