TFTC: A Bitcoin Podcast - #168: Will Cole

Episode Date: June 8, 2020

Join Marty and Matt as they sit down with Will Cole, Chief Product Officer at Unchained Capital, to discuss: - Will's work in Wyoming that benefits Bitcoin - Wyoming as a Citadel haven - Working at Stack Overflow - Bitcoin Stack Exchange - Joining Unchained Capital - Working on collaborative custody products - Caravan Version 2 - Hermit - Future bitcoin products - much more Follow Will on Twitter Shoutout to this week's sponsors. Cash App. Start #stackingsats today. Use the promo code: "stackingsats" to receive $10 and contribute $10 to OWLS Lacrosse when you download the app. Unchained Capital. Head over to www.unchained-capital.com/vaults and check out their 2-of-3 multisig vaults.

What's up, freaks? This is your boy Marty Bent here to introduce this episode of Tales from the Crypt. I was joined by our boy Matt O'Dell. We sat down with Will Cole from Unchained Capital to talk about his journey to Unchained, the products that they're working on at Unchained, why they build the products the way they do, how they're going to try to bring products that are true to Bitcoin's ethos to the market. we also talked about a bunch of the stuff that will did in wyoming to help get some laws passed there and create a bitcoin safe haven within the united states i'm not going to mention any more you guys are going to listen to the episode so we'll find out what we talked about but

huge fan of will great bitcoiner doing incredible work i think you guys are really going to like this episode this episode is brought to you by good friends at unchained capital disclaimer unchained is a sponsor will work for unchained so just know that going into this unchained capital is helping bitcoiners by creating financial services for bitcoiners with a security first mindset security first mindset what's that mean well they have products mainly their vault product which allows you to engage in a multi-sig quorum with unchained which you hold two or three keys on the ledger or trezor and soon to be a cold card soon tm it's coming you'll hear it in the episode uh you hold two or three keys unchained has the third key if you ever want to move your

bitcoin out of the vault out of the multi-sig volt you can do that by yourself if you're ever in a pinch you only have one key on you and you need to move your bitcoin unchained is there to be that second signature and that two or three quorum on top of that they have bitcoin collateralized loans if you don't want to sell your bitcoin and you need some us dollar liquidity you can take out a loan using bitcoin as collateral you put some bitcoin up as collateral you get same day us dollar liquidity on top of that they're working on incredible open source projects including caravan which we talked about in this episode uh caravan is an open source desktop app that allows you to create the multi-sig quorums used in their vault program so if you don't want

unchained involved at all you just want to create a multi-sig in an easy way they have caravan that allows you to do that very easy matt odell has set up multi-sigs while drunk with american hodl and keep it simple bitcoin uh on top of that and we're gonna slip 39 and hermit we dive into hermit in this episode too because it's really cool or did we miss it that might have been the uh the post episode talk we'll find out we'll find out um and then they have their blog series gradually and suddenly with parker lewis uh will's writing good content drew's talking about how to waste bitcoin in space joe kelly's adding to the mix as well as phil guider geiger excuse me go to www.unchained-capital.com check all this out that's www.unchained-capital.com

check out everything they got going on on top of this this episode is also you also you also you also brought to you by our good friends at the cash app cash app all right they're helping you do many things we're gonna start with sats sorry you could stack sats send sats receive sats sell sats if you so please on top of that you can make sats a standard within the app so you don't have any unibias problems and bitcoin doesn't seem as expensive you're stacking sats not bitcoin well you're doing both but it depends on how you want how you want to look at it on top of that they're allowing you to dca in the stats what's d in the sats not stats uh they keep your stats though so you can see when you're buying and how much and

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uh they're gonna get ten dollars not to be confused with that dirtbag owl you know he won't go away he's harassing the podcast i might have to i might have to get like a podcast restraining order on this dirtbag owl we may we may set a a precedent in law with a podcast restraining order on this dirtbag owl we're gonna look into it freaks use the code stacking sets and uh owls lacrosse not that dirtbag owl down the cash app and enjoy this episode we'll call incredible incredible conversation you've had a dynamic where money's become freer than free If you talk about a Fed just gone nuts, all the central banks going nuts.

So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor. I mean, that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. what is up freaks welcome back to tales from the crypt it's your boy marty bent here on a beautiful friday afternoon it's beautiful where i am excited uh to take a walk outside after we after this recording but before that walk we have a lot to talk about matt adels is

with us today sup freaks and we're both sitting down with one of the last bitcoiners we met in person before this whole quarantine and lockdown madness started a few months ago we're sitting now with the Chief Product Officer of Unchained Capital, our good friends at Unchained Capital, Will Cole. How are you doing? Howdy, Marty. Howdy, Matt. Good to see you all. Good to see you too. It's a long time coming. For you freaks that don't know, I've known Will on the internet for quite some time now. We've been talking in back channels for a while. One of my favorite Bitcoiners who's been doing a lot of important work, most recently moved to Unchained Capital to work on their product team from Stack Overflow. Huge pickup for the Unchained

team. I'm not going to explain all you've done for Bitcoin or all that you do in Bitcoin. You've done a lot of work in Wyoming. Before we jump into everything though, Will, tell us a little bit about yourself, how you came to Bitcoin and what you're doing at Unchained. Okay. I'm going to do that. But before, this is really fun. I've been wanting to do this for a long time and we've talked about it and you guys are awesome uh i think i think i met you before you started the podcast uh if i'm not mistaken i think so as well i think i think we were talking like maybe briefly before but it was before for sure yeah yeah and look what you've done this is incredible or both of you i mean like well the feeling is mutual look what you've done

and what you're doing yeah well thanks again for having me on this is gonna be fun um yeah so my background as you mentioned been been hanging around the Bitcoin world for a while now recently started it on chain capital last December and really I mean yeah my background starts you know 2011 2012 time of getting into Bitcoin you know living in New York City in the wake of of QE and the financial crisis and all the things going on i think that i think you know my memory could be a little bit shot here but i remember um you know i took i took a a strong interest in gold around that time um and i hadn't heard about bitcoin yet in you know 2009 2010 and i was just starting my gold journey when i uh found

out about bitcoin you know peter schiff and rickards and all that type of stuff and it sucks that they hate Bickling because I was really liking their stuff at that time. And yeah, it was sort of well-primed just living in New York. I was working at Thomson Reuters at the time making financial products for investment banks and things like that. And watching half of our clients just disappear in five months and all the havoc that was going on there, I would say that I was looking and primed to find something that was not the legacy system. But really, it was my brother, my brother Napoleon. He got into it. I was complaining. He was the one doing all the sleuthing online. And he introduced me to the idea in 2011,

like everyone that I think you've ever had on the podcast, you know, didn't do enough about it at the time uh but um but decided that uh you know stopped doing my own startups go join another startup make some money buy some bitcoin uh joined um stack overflow and actually fell in love with the product and what i was doing there um and uh stayed there for a while until uh unchain came calling yeah let's talk a little bit about your experience at stack overflow because i think that's why i was so excited when you came to unchain capital because stack overflow is a product it's a great product especially a developer and it's a developer focused product and bitcoins uh heavily depends on developers making sure that it is secure and it has a good uh

community that's so that's one thing with stack overflowed it sort of facilitates a community community uh of developers is that correct yeah um i i think it facilitates thousands of communities of developers i think that's one of the dangerous misconceptions of stack overflow and you know i don't, I don't speak for the company anymore. I don't work there, but I, you know, I did for eight years and it's challenging with that many people, right? It is community focused, like a Wikipedia, like Reddit and things like that. And, um, I really liked the sort of origin story at Stack Overflow, which was, you know, Stack didn't, you know, it wasn't the, you know, all the stuff that's going on with Twitter, with free speech and everything. We, we never had that problem

from the very beginning. It was, this is not a place for free speech. We are creating an artifact that is a question and an answer pair if you want to talk about things that aren't in the format of the question and answer pair you can go anywhere else on the internet to do so we were like heavily moderated we're famous for moderation it was that we are solving a problem of it's really hard to find high quality high signal information on specific problems for programmers i mean some you go to barnes and nobles and find a book and then like shift through it until it's like oh but that's an old version of this, you go look on, you know, different coding forums or IRC, and you're on page nine, you know, pagination, and it's like, oh, the correct answer is not till

page 14. We were we were really singularly focused on that question answer pair. And, but the truth is, is that most people don't experience Stack Overflow as a monolithic single community, right? You go to Stack Overflow, because you're a Python developer, or you don't know what's going on in our world or in C sharp world. So it's really thousands of communities and there's overlap. Sure. You know, between your tech stack. And I think that's one of the problems that we, that we run into lots of times is people expect it to be just one thing.

It's there are more people on Stack Overflow than there are programmers in the world. Right. Yeah. Yeah. You know, people that you have to do a little bit of programming on the side or something like that for their jobs. they you know want to do a side project anything like that you know by our best estimates that when I was working there we thought there were around 27 to 30 million programmers and Stack Overflow itself had 45 million people using it every single month unique people and so really that was a long rant to say you know it's it's not just the community separation on the Stack

Exchange network like there's Stack Overflow then there's Bitcoin Stack Exchange and Mathematics stack exchange it's like even within those things each tag itself is almost its own community and it can't be governed really monolithically so yeah yeah a bitcoin stack exchange is one of my favorite resources shout out to merch and everybody who helps curate that that exchange particularly oh yeah they've done a question about bitcoin it's probably been asked there before they've done an excellent job there uh the really high signal one of the best uh resources i think on the internet for you know keeping up to date information if you're you know if you're trying to connect your node over the tour network or something like that you're going to find a good

answer there um and people like merch the moderators on these sites do all the dirty deeds that's the way stack overflow works is it's not the people working there that are curating all the content it's the moderators of each individual site and they do a lot of you know uh unsung work it is and that's that's my favorite place and that's why i love about bitcoin optech too they have like a bitcoin stack exchange highlight of the week and yeah you can go there peter willis answer questions uh the people building out the protocol are answering questions at the bitcoin stack exchange so if you freaks haven't checked that out definitely go peep it um especially you have like a technical question about bitcoin again it's probably been asked there uh and well

so you transition from stack overflow working on that product to building bitcoin native products at unchained capital what was that transition like uh how did you sort of change hats there it's it seems like two very different products yeah really different products and you know i i you know the whole time i was at stack i had this theory you know i was working as the vp of product there and we you know built out a product team product managers designers and i had this idea of building out that team that the least important thing in hiring those types of people was domain expertise meaning if you got really smart people that understood software development they could create pretty much any software that they wanted to and you see this in bitcoin you know most people

come in pretty green they spend some time they do reviews they do you know and then they start contributing on more trivial things and then more serious things is that the domain expertise is less important than um then you know the the ability to you know understand product development cycles and be an expert in that so i wasn't worried about transitioning also because i had the enthusiasm of being around bitcoin i mean the entire time i was at stack overflow but the impetus for the transition was really that i had like a let's say kind of a flawed view of bitcoin entrepreneurship which was you know for a long time i looked at it and i said if i'm not contributing to the core protocol then there's not much else to do and i was actually

searching around for ways to do that i'd talk to guys like john newberry um steve lee you know uh to see if there was anything i could do there was the whole bit process and like oh i could do some writing or something but the reality was is you know with a demanding job at stack i wasn't going to be able to do much there and um and i found an outlet actually in wyoming and that really opened up the doors um you know joining the blockchain task force out there last year in 2019 um and going in thinking like oh this is a way i can you know spend a limited amount of time and actually do something good for the bitcoin world you know uh trying to create legislation and lend expertise that would um create a favorable jurisdiction for bitcoin companies

like that's a that's a worthy thing to spend my time on and turns out there's a lot of bitcoin companies circling around uh that these events you know all the sessions that we hold and uh there was a little bit of me just realizing that my view of bitcoin entrepreneurship that there was that i had a skill set that would be that would be valuable in bitcoin and that um and that i could contribute quite a bit and there was a lot of like shame like just being shamed by people so like they're like you know so much about this what the fuck are you doing like stack's cool like thanks but like what the fuck dude like you're wasting your life and um i got enough of that that uh i realized that i really was um uh not that stack i mean stack is a really cool place

but uh you know follow your passion do do the thing that you really love yeah i mean oh gosh i don't know where i want to go now let's focus on wyoming for a little bit we touched on that before actually last time we touched on it was with trace mayor who seems to be a persona non grata right now but uh shake my head um so what what was that experience like working with the legislator there um having conversations with these these politicians and and what did you guys get accomplished and and how is this good for bitcoin i guess yeah i mean there's there's a lot yeah and trace was circling around there this is before you know the the all the stuff with american hodl and all that and yeah i won't get into that because i haven't

talked to trace since that happened i don't think anyone has really but uh anyway uh he was great in wyoming and um and uh i went in actually kind of skeptical uh there so they were uh they they actually started in uh 2018 i wasn't a part of the the first sort of iteration of it and uh it was a legislator named Tyler Lindholm who was really the champion within Wyoming that wanted to do something there and you know really simple idea which is Wyoming is an economy that is dependent on energy and tourism basically for their entire you know GDP and that's where all the jobs are and they needed to diversify the economy and they wanted to find an unfair way to compete. And that's, that's kind of a cool setup here. So he was, he was looking at this

saying like, there's something happening in the world here. And we have the opportunity to outflank every other jurisdiction because that's, that is the goal there, right? Is they're competing with other sovereigns to create a jurisdiction that is attractive to individuals and businesses that want to deal with this sort of new economy. And being Wyoming, they, you know, there's just a small state, right? Everyone knows each other. Uh, you know, there's not a lot of left, right political infighting, you know, at the legislative group and everyone kind of had a singular goal here. And the way it's set up is, um, you have these experts, uh, you know, come into the public, uh, they're invited to the sessions. They get a test to testify on why it sucks to be in New York

city living under the bit license. And we get to look at each other and say, okay, cool. Let's create the anti-bit license, right? Fuck them. Let's outflank them every way we can. And these legislators are pretty passionate about it. And they bring in this sort of domain expertise to the public. And they invited a few citizens, Caitlin Long, which I'm sure people, the freaks here are familiar with. Matt Kaufman, who's a security, I think the only securities lawyer in Wyoming, another awesome person and myself joined last year to help out on these things. um and what we accomplished i mean there's a lot uh first of all wyoming was in a bad spot when this all started so all most of the exchanges have pulled out of wyoming um between you know

2015 and 2017 because of their interpretation of wyoming's money transmitter uh license rules basically they decided that they couldn't operate there and you know i had my mother-in-law had bought bitcoin already and she was on coinbase and hadn't moved you know uh to control her own keys yet her keys her bitcoin was locked up for three years coinbase would not allow you to access them it was a fucking really oh it was a disaster yeah and they wouldn't answer any emails there's no customer support you know like nothing like just forced huddle which you know not the worst thing in the world but at the same time scary shit um and they're crypto forward though i think they have some good customer support they give you your crypto three years forward you know and

yeah i think that's what it means yeah no i mean nightmare scenario though right like you can't i mean she couldn't even log into her account much less you know they weren't blocking a transaction or anything she just couldn't access it send in no idea yeah i mean i think there were a few other states like that um i think minnesota got hit by it hawaii um there were like four mtl issues in states um i could be wrong sorry i only know for sure of wyoming but i know there were a few other um and when the task force started up like the first thing they did the first accomplishment was let's change this mtl to signal to everyone that you know at least get to parity that these companies can operate here these on-ramp off-ramp companies um so that that passed really really

quickly uh which in most places it's hard to get legislation like that through we tried this year to eliminate the mtl license entirely that was one of the things that i worked really hard around and unfortunately i think out of the like 26 bills that have been pushed that's like one of three that has been turned down so i lost that uh that one you can always bring it back up yeah i mean you know it could take a few years but uh uh i believe montana is the only state that does not have a money transmitter license um based on what i had researched when we were going through that But, you know, really all that stuff was sort of the reach parity. I would say, you know, there's a lot of things that have been accomplished in this time. The really big one is the SPDI, the Special Purpose Depository Institution. I think Trace probably talked about that last time.

So I won't go into too much detail, except that they're taking applications now. So people that might have heard it back then, it was still sort of a conceptual thing. It was still waiting to be passed and amended. There are, you know, tens, if not hundreds of applications in already. I won't divulge any of the names, but there will be some big announcements. I think one that's actually been announced is Caitlin's Avanti bank that she's building. they've already announced that they're going through that process and uh we'll start seeing our first spdi um companies um come online here you know uh either really late this year or early next year um and the the significance of that i mean i think there's a couple things one is you know wyoming was the inventor of the llc pretty unknown thing but uh wyoming llcs are still super popular because of their privacy um uh their privacy governance you don't have to disclose the name of directors and some things that where you know i think delaware wyoming

south dakota or probably nevada are probably the largest issuers of llc's and in the nation and i think wyoming's done it again here i think what we've come up with with the spdi is a new corporate formation that's going to be really attractive to Bitcoin, financial service companies, custodians, payment processors that they'll at least have some form of their business is my prediction over the next couple of years operating out of Wyoming because of the benefits. Some of those benefits are you get a much better connection into the fiat world. Right now, we know of so many companies that get cut off from the fiat world because of

their lack of participation in the Federal Reserve Group of Banks. SPDIs are eligible for that access, which I know that some people are going to say Bitcoin doesn't give a shit about that stuff. Totally true. Bitcoin's fine without it. This just helps, right? It's a cherry on top. It's not necessary for Bitcoin to thrive, but it's something that Wyoming is uniquely positioning itself to make it less of a pain in the ass for these companies to get fiat banking services. It sets up a chancery court in the state of Wyoming that deals specifically with the issues that come up with this type of corporate formation. So we'll be getting laws on the books, jurisdictional certainty for companies that come in and know that the rug

is not going to get pulled out from under them. They're going to be screwed or they're not going to be dished out to some other court in some other state with rules that they didn't know they were being beholden to. Again, Bitcoin doesn't give a shit. You can do, Bitcoin can be very successful successful without any of this but i can say personally as someone who's now a part of running a bitcoin company this is pretty attractive stuff um being able to um have this sort of certainty that your own government's not going to pull the rug out from under you yeah it's huge thank you for all that work that you did in wyoming i mean and hopefully it incites uh other states to to make similar moves and just becomes more commonplace

and people it will be interesting to see like you just alluded to how many companies actually move to wyoming and if that makes other states jealous especially if bitcoin becomes uh more commonplace throughout the u.s and between u.s citizens what was you shared a chart with me uh the uh other week about like wyoming's wyoming could like how much funding the state has compared to other states like particularly new york new jersey illinois how much funding i'm trying to remember what that chart was uh are you talking about the sovereign wealth fund that they run that or it was something to do like with the budgets like how much oh yeah yeah yeah the budget surplus and you know wyoming wyoming is really weird because you know i think it's so

funny if you i don't want to lecture anyone here but like the state's right stuff you go into these legislative groups, and it doesn't matter if you're a liberal or conservative, like the people in state legislators, they take the 10th Amendment really seriously. And states, the United States is so primed to dominate in a Bitcoin world because of the fact that we have states that are sovereign. And what you're talking about, I think is related to, you know, where does Wyoming's budget come from? Wyoming has its own sovereign wealth fund. I think it's one of three states at least it used to be new mexico and alaska also had a sovereign wealth fund there might be more now but um because of all the energy production here uh uh and the fact that

there's no state income tax property taxes are super low like this is a good space for individuals on the tax side of things um they get most of their taxes through you know these energy companies that are drilling oil, uh, the coal industry, uh, natural gas, all of that. And, uh, it's a huge fund. Um, and they use that money for a lot of their budget. Um, uh, they, they have, if they have budget problems with their schools, the sovereign wealth fund comes in and, you know, covers the gap between the taxes and it helps keep the taxes low. And that sovereign wealth fund is, uh, controlled by the treasurer, um, ultimately, but also has like a chief investment officer who, uh, invest that, uh, invest that money on the behalf of the citizens of Wyoming,

uh, just kind of like Abu Dhabi or Singapore or anything like that. And, um, so yeah, I can't remember the exact numbers of the chart I showed you, but, um, on a per capita basis, you know, Wyoming's in good shape because of that fund, uh, doesn't have as many, you know, I mean, they still get budgetary shortfalls when it comes to tax revenues and things like that. But, um, uh, it's a good backstop. If I remember correctly, I think compared to like the baseline, it was something like 400 times overfunded compared to other States or something like that. It's like something insane.

I mean, let's be, you know, honest here. It helps when you have about, you know, 520,000 people in the state. Yeah. Yeah. we got well it'll be again with the uh with the lax bitcoin regulation now kanye making it popular to move to wyoming it'll be interesting to see if a bunch of people um begin moving there i mean it is i've looked at land in wyoming it's pretty cheap yeah wait kanye moved to wyoming yeah cody he's uh bill gates and warren buffett's neighbor up there in uh cody wyoming he did a church service that my wife uh was talking about i wasn't up there during it but she was uh yeah embraced what's that did she go no she was driving back and said hey we just missed this thing

and i was very disappointed i think kanye is a great man and uh i don't know much about his music i just think he's a great man and uh would uh would have liked to have met him up there that's one of my wife's biggest goals to get to a kanye sunday service but yet matt he's building a citadel wyoming yeah that's badass is it near jackson hole i don't know wyoming at all so so cody is sort of northeast of the um of uh yellowstone park really close to the montana border uh jackson's on the south side of yellowstone um so i mean still relatively close but a couple hours um they're both in the in the northwest part of the state it's interesting how it's become like this rich enclave you know wyoming yeah it's just that area really uh the

rest of the state it's it's that's not true uh wyoming is a very working class um place it's almost all you know ranching uh agriculture uh oil and gas type blue collar jobs um uh you get you have this little spot in teton county um and then out to cody a little bit up in sheridan on the other side of the state as well near the big horn mountains but uh it's it's it's jackson's a very singular thing that's very different from the rest of wyoming i would say beautiful love it but it's not representative at all i have i've actually um i've been getting meats delivered by uh by ranch or carter country meats out in wyoming yes are you getting it in the yeti cooler i have not that my next order i'm going to i think i'm gonna i'm gonna do it um i'll be getting the

the eco-friendly boxes to date those guys are great uh a lot of the butcher shops that i go to in wyoming source their meat from carter country awesome they're up in tin sleep wyoming middle of nowhere awesome place uh they're an awesome company you can order online they have deal with yeti that's based in austin texas where uh you can refill your uh your uh meat supplies uh keep it cold and the best cold cooler in the world and uh they're they're an awesome shop they are their meat's really good too they threw in a they threw in a tomahawk at my last order that was incredible nice thick tomahawks um but from steaks to multisig yeah it's a bitcoin native products what uh you you're mentioning this before we hit record you you and parker have been

having conversations about bitcoin native versus bitcoin only is it verse or no it's not verse and yeah i've been talking with you know parker and joe kelly and drew and a bunch of people at unchained really about this uh phil geiger um is you know i know that uh i remember listening matt actually to you on uh peter mccormack where y'all were talking a lot about the bitcoin only companies and um you know uh one of the things that attracted me to unchained was you know i don't hold it you know the exchanges you know doing all the exchange business model having lots of different cryptocurrencies you know it doesn't bother me all that much um but it wasn't a super attractive thing for me to work on and when i was talking with the unchained folks about

joining them like the the focus on bitcoin um was certainly one of the things that you know got me going it's what why what i wanted to spend my time on you know um and they had some unchained had some history with this right uh originally early early on they did both bitcoin and ethereum uh backed loans and i think it's important to bring this up uh because like it wasn't just like some bitcoin maximalist you know you know a company that that started that way it was a pragmatic decision to go to bitcoin um only and uh that decision was because really twofold was that the market you know three percent of our business was in ethereum because people weren't really using it as money and the second is is that when you're a startup and you have limited resources

and you really want to and you're dealing with something that requires such you know strong security um it stretches your engineering teams then when when you want to do it the right way and we were not outsourcing custody of our loan products back then uh you know drew versus our cto was not happy with the custody options and didn't want to put our users in that position so we you know went to the bitcoin protocol and did native multi-sig um for uh collateral for loans uh on ethereum we uh one of our really really brilliant um uh developers created uh our own uh smart contract and um but it also scared the shit out of us we we we really felt good about the bitcoin stuff but the smart contract stuff you know just hear horror story after horror story and

even you know the um engineer destry who built that smart contract i think you know he told me he was relieved when we dropped that um and so i said you know so i end up joining what becomes a bitcoin only company and as we're thinking about it like there are lots of companies that are bitcoin only and i think that that helps for the reasons i just mentioned but um i didn't think it was really descriptive enough and and trying to describe like why these companies are bitcoin only um i don't think it's just it's because the companies are full of bitcoin maximalists or something like that um you know our company has a wide variety of opinions on uh cryptocurrencies and stuff like that not everyone's me or parker right um and so this idea of like bitcoin native

kind of popped up um and we're not trying to just we're not trying to define for other people what bitcoin native means but for us i think it's an apt description of what we're doing because um we have this idea of you know all those sort of tenants of bitcoin that when you get into it that you first think about like uh oh you learn about the supply cap and you learn about sovereignty and you learn about censorship censorship resistance sorry um auditability security things like that you you learn about these like aspects and you know the challenge that we've kind of put to ourselves is you know okay if we want to be bitcoin native like how do we respect these things? Like, how do we get ourselves close to, to these things? So I think about the Bitcoin

supply cap, like, what does, what does a company have to do with Bitcoin supply cap? And then I think back to S2X. And when you have industry and companies trying to be forceful around the decisions around the protocol, like forcing hard fork, you know, the only way Bitcoin supply cap is ever going to get screwed up is through a hard fork, right? And when you start demanding it because of your own business, right. And, uh, trying to form your own consensus, then, um, uh, then you put that in jeopardy. Like I'm of the opinion that we, you know, then unless something existential comes up, there won't be another hard fork. Um, because of that's the only way you can change the most important thing about Bitcoin, um, that there's 21 million

of them and that's not negotiable. Um, so the Bitcoin native approach to that is to not put yourself in a bad position where you're trying to push things that could put something like that in danger right where you know companies for better or worse sometimes can have an outsized voice and um or at least think they do um and some of these decisions and you know have sort of this policy and this understanding that you're not going to play that game and then there's you know some some more like practical things like sort of the the sayings that we all come come uh come into bitcoin you know sort of hearing eventually which you know not your keys not your bitcoin don't trust verify uh you know those types of things uh how do we sort of embody that as a

company if we want to and really this isn't necessarily because we're altruistic or it's because this is the types of products that bitcoiners demand from us like we have to meet market demand um so building a bitcoin native company and bitcoin native products to us looks like okay let's start with not your keys not your bitcoin you want to build a lending product shit this is going to be hard right like uh uh okay we have to take we're going to do bitcoin collateralized loans but we really care about custody and okay this is going to be a hard problem to solve right and this is kind of you know this is before i started this is drew and joe really thinking through this problem and deciding that the best way to do this would be

not to outsource you know or to become a full custodian but to allow um the borrower to participate in the quorum of keys that is controlling that bitcoin so yeah it's still you know you can't have sovereignty over your collateral because then you can take the dollars take the take the bitcoin and go run off uh no one's going to lend you dollars in that sense but if we say something which we do like we're not going to re-hypothecate your collateral right We're not going to go gamble with your collateral because the whole reason that you're taking out this loan is you don't want to lose your Bitcoin. You don't have to trust us. You can get a key,

you can spy on that address and you can verify that we're not moving your funds. That was sort of the Bitcoin native way of doing loans. Our best estimation and maybe there's a better way and we're going to keep on, you know, trying to find it. And it's the same thing for custody in general, right? That was our second product that we came out with. And this idea that how do we make multi-sig, which I mean, I would argue is still fairly obscure amongst even semi-hardcore Bitcoiners. How do we make this more ubiquitous? How do we get this into more people's hands? because we know that there's demand for um sovereignty but it's not easy to do and that

there are some forms of self-sovereignty that even though that's great better than having it on an exchange isn't necessarily secure and um so what's what's that look like and that was sort of the rabbit hole we went down with um with collaborative custody and that's our vaults product where you know uh we do two or three multi-sig and you know your your listeners know this you've done the drill on this i won't go into too many details there and uh but the the sort of reasoning behind it and the way we're thinking about our strategy is um thinking about this idea of bitcoin native how do we build our products that are as close to the protocol as possible that are taking advantage of Bitcoin's unique qualities. You can't do a loan the way we

do without Bitcoin. You can't give the borrower some of the benefits of knowing what's happening with their collateral without Bitcoin. That's a pretty cool thing because what I want to be able to do, being a part of a financial services company, is not mimic what's happening in financial services today, it's building things that are unique to Bitcoin because that's where we can win and where we can diverge from the legacy system. Plus, there are business models and financial services that just won't work in Bitcoin. And so you have to find new ways to do things. And the more you understand about the native way Bitcoin works, the more successful you'll be in building that type of company. Can we unpack this a little bit? Because I think

people are more confused uh than we often realize i've noticed okay um with regards to uh the way you do your collateralized loan product okay um compared to a custodian a custodial solution which is what most most of these loan offerings are where there's full custody um you want to explain that for the listeners yeah absolutely you guys sort of get looped into to competitors who who don't let users track their collateral yeah and you know that's unfortunate and it is it is a nuanced thing it's kind of hard to understand what the repercussions of that are so i'll i'll do my my best job here uh that i can so the way we do loans is um for whatever reason uh if you want dollars and you don't want to sell your bitcoin an option

is to take a loan against that bitcoin um i'm not here to push that on anyone or anything it you know if you don't want to do that don't do that if you want to sell your bitcoin do that it comes with consequences you know if you have to meet margin calls it can be fucking scary um but also it can you know done right it can be something that really helps you out in your life if if if you don't want to sell your Bitcoin, but you need dollars for whatever reason. So the way we do that is, yeah, you have to give us Bitcoin. We collateralize it basically at a two to one ratio. So if you want $100,000 or if you want $20,000, let's say you want a $20,000, you would give us at that time $40,000 worth of Bitcoin and we would put it into a multi-sig

arrangement where you have one of the keys, we have one of the keys, and a third party that we have a contract with has one key. And that setup is interesting for a few reasons. One is unlike having it in a full custody option, there's not a single point of failure. So if, say, you lost your key, or we lost our key, or the third party lost their key, we still have a way to sweep those funds into a new address for hacker purposes and things like that. There's not one custodian to come after your collateral. And remember, you're taking this loan out typically because specifically you don't want to sell. You want to get this Bitcoin back is the reason you're doing this. So all those security measures, I would think that you would care about how your Bitcoin's

being stored similarly to if you were storing it yourself. Obviously, we can't give you full sovereignty over the Bitcoin in this type of arrangement. But it's not just that you have that key, right? And it's not just that the security is better in this model. It's also that we promise that when you give us your Bitcoin, we are not going to then take that Bitcoin and then go lend it out to other market makers, short sellers, et cetera, and to go gamble with your Bitcoin. Again, the whole purpose you give us this Bitcoin to begin with was that you didn't want to lose it, right? So we're going to do everything we can to help that not happen, which includes not re-hypothecating, which is what that means, right? When you have collateral

that then gets lent out and lent out and lent out. We don't do that. It just sits there. And you don't have to trust us. You have a key. You can look at that address and you can see if we move it. And if we do, we've broken our contract with you. Or something bad has happened and you can call us out on that. That's never happened. We don't expect it to, but it's a way for you to hold us accountable and to sort of keep that ethos in mind, right? The, you know, don't trust, verify nature that Bitcoin allows us to have this relationship with our clients. And I'm going to stop there for a minute. Yeah. There's trust, but it's trust minimized. Yeah. Yeah. Significantly from a full custodial offering.

Yes. I would agree. Yeah. There is trust and I don't want to, you know, make anyone think that there isn't. When you do this, you are KYC-ing with us. Hell, I wish we didn't have to, but when you're offering this type of financial service in the jurisdictions that we operate in, it's the game that we play. If people don't want to use it because of that reason, totally support that. But I still, I look at competitors out there who do do full custody. maybe they save you a point on the on the uh on the interest rate because they're re-hypothecating your bitcoin or something like that and that's not the type of product i i would want um i look at the defy options and the shit show with all the uh the flash crashes and everything that happened

and like you know uh there and you don't have anyone to call or anyone to talk to you got customer service you have a trust minimized option you can hold this accountable i think that's a pretty legit product offering and honestly you know i'm not a loans customer like i i i didn't use that product myself but when i met joe and drew originally and they described like the i mean kind of the crazy links they went through to try to build this product the most bitcoin native way they could you know uh with trust minimization with this custody model i was pretty impressed to be honest this is before i worked there and it made me more interested in the company overall yeah that's what really impressed me about drew and joe early on drew was on this podcast very

early in the game he approached it with the security first mindset and then so like making sure that he could build the products in-house and secure the bitcoin and at one point he had like the only audited ethereum smart contract that was actually legitimately safe like it was at one point as safe as we could get it you know right yeah yeah uh and then the product just grew from there asking customers what they wanted like people asked for the loan product and it's like all right we're gonna build it and we'll give that to you in this way if you want it uh and again with the security first mindset i think what's most admirable and why i love working with you guys is um is you open source everything okay if you're using these tools like you want

And you want Bitcoiners to have the same security that your products have, just open source the tools that you're using. And I think that's extremely admirable. And so I guess it's a natural segue into Caravan and why you guys do that. Yeah, Caravan is a cool thing that we've been working on. And as you mentioned, it's very similar. you know we you know we did we didn't talk as much about the vault stuff but that same sort of you know sharing of keys you can do with just a vault where you take two keys and and uh we take one as a backup in that case you're giving up privacy uh right so we know we know the address and the

amount in there but we don't have the ability to move funds so um there are you know trade-offs again in this scenario. With Caravan, Caravan really is kind of a pick your poison, do whatever you want type thing, right? It is open source. It's built much in the same way. It's a little bit more flexible than our own proprietary product. And we're starting to use more and more of the Caravan libraries, underlying libraries in our proprietary product, again, for that trust of minimization to live up to our own standard there. But mostly what our decision to build Caravan and release it in November of last year was this concept of, well, what makes us special as like a company is actually not multi-sig. In fact, we think that multi-sig is going to be

commoditized, that everyone's going to use it in some fashion or another. And that's not our secret sauce. It's not, you know, just like financial services companies, they compete on technology and they are technology companies to some extent but multisig was certainly not a defensible technology that we were going to like win in the market on and so one of the things that we made a conscious decision of was um uh trying to put our thumb on the scale and um uh get more people using multisig whether they were using our product or not um and i think having a dedicated open source multi-sig product out there is something that will appeal to some people that are proprietary product won't appeal to, which is fine. But it's better to get more people

on multi-sig. It also creates more conversations and breeding ground for all the different people that are working on multi-sig to, you know, talk about standard about interoperability and talk about you know um you know the software and hardware um interoperability that you need to do uh multisig uh self self-sovereignty um so caravan what it started out as was really that idea that you know everyone should be using multisig whether it's with through our proprietary product or not and also it could benefit our proprietary product um uh so what if you had a vault with us where you had two keys and we had one and our website was down like what would you do you could go to electrum um uh but electrum is you know it's

it's fabulous software in a lot of ways but it does a lot of stuff it's multi-purpose it's kind of the best thing about it is that it does everything and the worst thing about it is that it does everything and we were thinking that um to make people feel really secure with using multi-sig even on our preparatory side we needed a backup what if we're not around for you what if we can't countersign what if you what if what if you don't even want us to countersign but you're just using us as a coordinator and our website goes down um what are you going to do well you can easily just take your your keys go over to caravan and um and do your spins through through there um uh without permission from anyone um and that that's pretty cool i think uh it adds it

it both does something for the open source world and multisig like i started the beginning but It also helps our product or anybody's product that's offering something similar to us is that their clients can go to Caravan and spend outside of that proprietary world. It started off as pretty naive, right? We wanted to do one thing and one thing well. And it was more of an address coordinator. When you started, you'd come in, you'd have your private keys, you need your redeem script and BIP32 pass, put in the redeem script, put in the BIP32 pass, you can sign, you can generate that address and spend it however you wanted. Recently, in the last couple of weeks, we've released an update to Caravan, which I think y'all covered a little bit on. But the main difference here is that it's no longer an address coordinator.

It's really a full-blown multisig wallet. And that was a big step in terms of functionality and value for open source customers. so the the big changes here um uh you know number one is just xpubs uh is that instead of dealing with uh just redeem scripts and public keys now dealing on the xpub uh layer which is generating a multi-sig wallet coordinating all these extended public keys and um and then next after that giving you the ability to spend from any of the addresses in that wallet so it's not a single address thing anymore. Um, that was really big. Uh, some, some cool little things that we can do now. Uh, like you can, you can download your, uh, like a little Jason file, uh, sort of similar to a cold card

where you do wallet initialization, same information. Um, you can download the pub, the X pubs, uh, the 32 paths, et cetera. You can store that securely however you want. Um, good thing to note on that. What's the, what are the repercussions of losing a file like that? no one can steal your bitcoin because they can't sign with that stuff but you do lose privacy if you lose that file so best to encrypt it but put it in a password manager you know however you feel safe doing that depending on the value of uh what you're storing in that wallet um you know it's not the end of the world if you lose that that file but you'll probably want to sweep funds uh if you do but anyway you can get that that nice cool file that uh so that you're not manually plugging

stuff in every time or you can manually plug stuff in every time doesn't matter initialize the wallet and boom your wallet's up on caravan the reason i bring that up is that caravan is stateless so it's not like you have an account that you can log into and it's remembering the details of your wallet every time you interact with caravan it's every new session basically you have to build the wallet from scratch it's tabula rasa then the state is essentially saved in the json file well yeah that's the that that's what builds the wallet and you don't have to use that um once you build the wallet the first time you can decide like hey i'm gonna use this a lot and i want to encrypt this you know file on my computer you can download that json file

or if you're bringing uh you know there's still again one of the reasons is we got to figure this out amongst people that are doing this um electrum allows you to create a file like this so this cold card want to get something that is interoperable between everything there and that's that's like you mentioned that's standardization is a huge unknown right now and that's why i like this version of caravan uh particularly is because of the testing suite that you guys built um that can sort of start pushing the ball down that path yeah the correct assumption to make with with the testing suite yeah i mean it's it's the ultimate goal it's not there yet but that is kind of you know, if caravan successful, this is one of the ways it can succeed, you know, even if it's not

successful as a ubiquitous wallet that everyone's using, say, if hardware manufacturers before they release new form firmware, or, you know, something like that, ran their hardware through this testing suite that that caravan has, which is, you know, checking, you know, some standard multi-signature bit 32 paths that is uh making sure that the hardware wallet can generate and sign you know all the different addresses p2sh p2wsh p2sh dash p2wsh all that type of stuff uh you you're you're kind of going through the the suite and making sure that it's compatible with all the different multi-sig addresses that you want to send to um if we could do that uh i think that alone would be a really big win um and through the process of developing caravan we've

had other wins like this like where um you know trezor has an open source you know it's open source as well we noticed that um there was no way for us to confirm multi-sig addresses on um on the device which is uh something we really you know it's it's a security flaw right uh man in the attacks on your browser and stuff like that and like you know you can mitigate them and uh but at the same time if you really want to be sure you want to get that address showing up on the hardware device to confirm it um we were able to collaborate you know really it didn't take much uh i think druve it was uh wrote some code put in a pr trezor guys responded uh liked it got it into trezor connect 8 and so once you know we updated trezor connect 8 now when you're on

caravan you can confirm multi-sig addresses on the device like that's the type of win that i want to come through caravan and i think that it's reasonable to expect that like if that were just our proprietary app or we're just pushing this stuff through that that it wouldn't be as convincing um and it's nice to have caravan to kind of uh uh build up those uh those use cases and um um yeah those fundamentals it's uh yeah i mean i was it's funny not funny but it's incredible to see uh how fast this this new version of caravan came out because when drew uh demoed it the first version of caravan in the fall to us he he asked like what do you guys want first question i asked is like why can i dump an x pub in here and to see like five months later

six months later that's already there is it's incredible you guys are reacting to user feedback which is what uh what i'd like to see in a bitcoin native company it's reacting to the users not really just building stuff just to build yeah there's no use in building that oh go ahead the key there for the listeners is is you don't want to reuse addresses yeah yep yeah and you know i look i look at it and say um there was a reason we had built things in a way you know like uh at the beginning but uh certainly the way people were using our product over time they wanted more wallet functionality right um uh they wanted to you know even though it's a cold storage vault it turns out if you build a really good cold storage vault that isn't

a pain in the ass to use um people will transact like it uh you know most of it you know might be staying in cold storage but you you realize that you do want to spend from it more often and move money around and we had to sort of react to like oh shit this isn't just going to sit in an address forever um and uh you know bringing that wallet functionality was you know a really big deal the other thing is is it's also just absolutely necessary in order to work with you know anything that's psbt so cold card probably probably future versions of trezor i'm assuming at some point they're gonna use that little sd card for psbt any day now i yeah i keep on hearing it they're using it for something i don't know what it was it was something really good to fa yeah it was

kind of obscure and weird i mean it's fine uh and i assume they're gonna do it eventually but uh I know Christopher Allen's working on some open-source iPhone wallet that's PSPT-based that we want to make sure Caravan's in. Fully noted. Yeah, fully noted. That's right. Hopefully we see Ledger ad PSPT, too. Yeah, I hope so. I mean, all of them should.

Biggest question from the freaks who want to use Caravan is when cold card? Yeah, dude, I hear it all the time. uh i i tease our director of product marketing phil geiger who uh i think every time anyone ever uh asks him about cold card he sends me a message which means i get multiple messages every single day about it and he points to twitter every single time someone responds to some unchained tweet with you know win cold card i'm convinced at this point that he's just creating sock puppets and like you know trolling me to uh speed up the development here uh it's it's actively being

worked on right now so uh if you know caravan there are some open source libraries that it uses um uh primarily unchained wallets and unchained bitcoin uh both both open source unchained wallets is uh what uh is how caravan interacts with all the different hardware wallets and so the first thing that we're doing is uh we are finally ripping the band-aid off and uh our internal proprietary product is going to be consuming unchained wallets and how it interacts with hardware wallets which is a big first step and the next step and that is excuse me is adding psbt and cold card support to unchained wallets happening right now uh it's a lot of work um you know because we're teaching caravan and our uh products about psbt for the first time but um

we know everyone wants to see it i love cold card i love the guys that work on cold card and it's a fantastic product we're going to get it supported real soon here soon TM it's coming freaks I've said it so many times in the ad read they're like when's it coming I'm like ah it's coming

you can point your tweets towards me and every tweet speeds it up a day actually please don't do that I know how much I roll take your time do it right that's the way to do it

uh yeah i just wanted to just all this sounds really complicated like the reason caravan is such a big deal is because it is insanely simple to use for what you would expect you think it'd be way more complicated um but it's worth it for people to just go give it a try uh if you if you have a trezor t uh and you can enter the passphrase right on the right on the touch screen you're able to create multiple wallets every pass raise is a different wallet so you can actually simulate a multi-sig with a single piece of hardware uh with very little you put a very little bit of bitcoin in there then spend it out uh it's that's my favorite way to learn is to actually try it and do it and i i think it's well within reach of a lot of the

freaks when they think it's it's more overwhelming than it is yeah you've been uh you've been making drunk multisigs with caravan not advised according to unchained capital but but it is possible if american huddle can make a multisig drunk i think most of the freaks can do it yeah i mean i i'd love that i mean for i mean we really do want to make multisig easy and conceptually it can seem intimidating but i'm telling you if you go in and play with it you're going to figure it out if you have a hardware wallet if you have a trez or if you have a ledger get going um i i'd love to hear your feedback that's another you know one of the things with caravan is i we we're not being super ambitious with features i don't want it to be everything for everyone i want it to be

really good at a very narrow set of things i want it to be simple and uh simple to use so it's supposed to be a multi-sig stateless wallet i want it to be an awesome multi-sig state stateless wallet yeah there's some features i want to add but mostly we want to battle test this and if you're interested in that excuse me it's open source go play with it tweet at us put in a pr do whatever you want to do tell us why it's awesome or sucks um it's really helpful so i'm trying to trying to think of where i want to go here so caravan version two's out like what like you mentioned you want some more stuff in it like what

how do you think it could be better moving forward i want it to be easier to add new hardware wallets um that it supports so whether it's cold card fully noted i have you know i get i get all these people sending me hardware wallets now and uh gotta try them out and see if we can support them uh so it's easier for hardware wallet manufacturers if they want to to get supported in caravan uh so we want to make that whole process a little bit easier uh like to be able to get into um address labeling um i know that that's uh been asked for many times and would be super helpful uh i want to make it easier for people that are using multisig on other platforms so standardization around this wallet initialization to make sure

that caravan can be interoperable uh you know obviously we want it to be operable with the unchain vaults but uh interoperable with any multi-sig um vault that you might have out there because it can be a backup for everyone um there so uh those are the types of things and really making sure that we keep our own ambitions kind of neutral to the sense that we're being hyper reactive to the open people that form around this that really care about it because um we know our use cases for it but there's going to be a lot more that comes out there and it takes time for these things to grow yeah yeah you mentioned the labeling when we went through the demo you explained to us why it's sort of tricky with multi-sig um what are the problems with

labeling currently it's not it's not it's not that there are problems necessarily it's just that it's it's not an easy feature to bring in and it wasn't something that uh you know looking at the priority of stuff like this was a bear to build like this you know i've been learning this since december right i i i haven't been around building stuff on bitcoin for a super long time is that i wanted to really more than anything uh reduce the feature set to something that we could be really proud of and know that it was secure and the labeling stuff more than anything just came down to a nice to have at that point like get the wallet functionality rock solid um get the get the, uh, sort of UTXO management rock solid, all of that stuff first. Um, it's not that address

labeling is impossible or, you know, anything like that. It's just one of those things that will come with time. And the reason labeling is nice is because you have this nice coin control where you could pick which UTXOs you spend from caravan, but let's say two years down the line, three years down the line, you're trying to pick which UTXOs you're going to spend and you don't know what those UTXOs are from. So if you have these nice labels, then you can go back and you can be like, okay, I bought these from Cash App or I got this from an invoice I sent or whatnot. These coins are KYC. These ones aren't. Yeah. I mean, there's lots of valid reasons to want to label. And just from Caravan's perspective, there are other wallets that do it. So we want to be

interoperable we want to be a backup we want to you know uh stuff like that uh we're going to want to be able to do that for sure i kind of want to talk about hermit because i think it's badass and we don't talk about it enough you want to chill us hermit i you know i'm i'm the wrong person for that uh hermit is badass and we don't talk about it enough and it's something that uh uh that i know i should know more about but uh you know i haven't spent a lot of time on yet you know in my first you know few months working at unchained uh so you know maybe that's a good reason to get drew on again you know one of these days since he hasn't been around for a long time what is the high level on hermit again hermit basically uh it's it's a good way to to sign

right like we can uh use it it's open source again uh so i'll pull up here um if you give me just second well the cool thing to hermit about hermit for me is that uh it has shamir's secret sharing so you can shard a key so used in combination with multi-sig it allows you to take a single multi-sig key and then you can split up that key in a bunch of shards so then you can have and they have this hierarchy system built into it so you can have like different levels of shards you know if it's an upper management or a lower management and when the threshold comes together of those different hierarchies then you can get access to that single key so you can like further even though the multi-sig might be a two of three one of those keys could end up sharded

between a hundred different people of different hierarchies so it gets really really powerful really quickly yeah it can really help uh you know with uh geographically dispersed signing um if you have you know corporate governance type things where it's like okay well we had an employee here that had access to one of our keys or you know a bit of that key and now they're gone and like you know there's it's a way to really sort of scale up that governance of your uh how you handle signing for multisig um and it's really cool we're uh it is another tool it's separate from caravan that is completely open source i know that uh uh we've had uh you know groups like blockchain commons and chris brown look into it before um and uh something that we work on

ourselves um to again we try to consume all of our own open source stuff as well yeah it's completely badass and that's i mean i think again fawning over you guys disclaimer on chain's a sponsor of this podcast yeah probably throw that disclaimer in the beginning i'll put it in the intro yeah when i read when i read the ad um uh no i think you guys are leading the way an example of of giving back to bitcoin through these open source projects not and it's not only the open source projects the the blog series you've written a couple already um parker's obviously got gradually then suddenly phil's writing drew's writing some really cool stuff the futuristic use cases of bitcoin and hodl waves i think you guys are a great example of

of giving back to bitcoin and and sort of showing what other companies probably should be doing i think some some that have been around for a while have yet to adopt segwit or uh contribute to development of bitcoin and you guys are just running a little humble shop in austin texas uh working away just just doing hard work and leading by example in my opinion hey man uh i mean i appreciate it in you know being a relatively new member of the team you know this is what you're saying there that's what attracted me to to work there right um uh there there are a lot of good companies in bitcoin um but i feel like uh what we're doing at unshamed right now is doing it the right way i also wanted to point out one thing that we missed is uh one of the big things

on hermit is uh you can do this all air gapped which is one of the one of the big uh i do that's one of the internal use cases that uh why we're very high on it but i do encourage people there's a there's a good blog that uh driven the team wrote um before i joined on hermit if you want to go check it out on the unchain capital blog which is you know dominated by those uh series that marty just mentioned the gradually the suddenlies and multi-sig uh beginners guides and stuff like that yeah that's a nice well-rounded shop and you guys are adding more products to the mix too you recently a couple weeks ago or maybe a week ago announced slowly rolling out uh an otc desk in texas only how's that been going and what's what's that product look like oh it's cool

uh one of the things that when i joined is i had this this line in my head of you know what is a product that i've always wanted that i can uniquely build at a company like unchained because of some of the stuff that they've already done. And that line is kind of a mouthful, but I think everyone here will get it, which is, I want to be able to buy Bitcoin directly into cold storage multi-sig with keys that I control. Now, it's a mouthful, but the concept is simple. I want to be sovereign over my money, and I don't want the counterparty risk of an exchange. And how can I do that? Well, we have the vaults. How can we help people buy directly into the vaults? Well, it's not that simple right it's a shit show there's uh the regulatory shit show out there you know you can't

just turn that on even though technically it's not the craziest thing in the world so but we are starting to make that true uh it's not a retail thing right now it's more of an otc style you know high high you know high volume type um buying uh activity uh that is opened up in texas now um so minimum would be you know 50k ish um sort of buys our institutions and high net worth individuals stuff like that that buy bitcoin like that um that's what otcs are for and when they buy bitcoin with us um essentially they put in their trade and their bitcoin uh once the dollar is clear goes directly into an unchained vault with keys that they control i am fucking pumped about this like i it's hard to contain my excitement on this is that like this is something that

you know we've been telling people forever you know like don't keep your bitcoin on exchanges like don't keep your bitcoin in full custody places but there aren't really good ways to buy bitcoin or to receive bitcoin or to do this on-ramp off-ramp type uh transaction where you don't have significant counterparty risk and again our our our solution is not risk less but again trying to get to that trust minimized as much as we possibly can we're at least getting one of that one of those layers um sort of out of there one of that uh one of those pieces of counterparty risk eliminated which is keeping your coins for any amount of time on an exchange um so yeah it's cool i mean it's only been going for a couple weeks now um and um it is only available in texas

for now but you know i think what you'll see is us grow out this otc sort of functionality um throughout the united states um you know work on our own internal processes um automation all that type of stuff that will make this a lot simpler and um then hopefully you know if the regulatory stuff works out the way we want it to be able to do some retail around this eventually not this year hell yeah yeah it's it's been again like very interesting to see your product suite evolve it's from simple collateralized loans to multi-sig volts now otc like what how do you envision what do you envision unchained looking like in five ten years what is the product suite like what about post hyper bitcoinization when you're not even connected to the u.s dollar at

some point how do you how do you evolve your services then yeah i mean that's what we're counting on right uh you know to a certain extent when you're bitcoin native or bitcoin only right is that you're you're uh sort of throwing out the steering wheel and letting bitcoin take you where it's going so uh we are uh definitely you know number go up is a big thing for us um and you know our business sort of goes as bitcoin goes and in five or ten years i mean i don't want to scare people on the podcast. I'm too bullish. Like, I don't want to come out looking like a lunatic, but that's one of the, okay. So I want people to hear this message on keeping your own keys. And I know that, you know, everyone on this podcast has heard that a thousand times,

and I guarantee you that, you know, 25% of them still haven't made that jump. Self custody, you know, get control of your Bitcoin keys because right now you might have $500 sitting on an exchange and it doesn't feel like a big deal. But if we're talking about what's the future of Unchained in five years? What's the future of Bitcoin in five years? That $500 could be $50,000. And now you're sitting on an extremely large amount of money. And you have to plan for this type of stuff and not be in, you know, learn about it and understand it before these scary moments hit you in the face. And you're like, Oh my God, like I'm, I have significant exposure to these third parties that um that i'm trusting too much hold your own keys or learn how to hold

your own keys right now because your hundreds are going to be thousands and your thousands are going to be ten thousands and your ten thousands are going to be hundreds of thousands and uh but that's the future that we're building towards we expect that to happen with bitcoin um if it doesn't happen with bitcoin then our company is not going to work out most bitcoin companies aren't going to work out if that doesn't happen uh we are building towards that future so what type of products um yeah this buy bitcoin stuff maybe that's not a big deal in five or ten years right um or 15 years that's fine right now i'd like to help people obtain bitcoin as much as i can in the most trust minimized ways that they can but in the future i look at it this way i

could draw a chart you know with a line down the middle just a piece of paper and list out what do people do with money right now right uh what are financial services that exist in the world And on the other side, I put the attributes of Bitcoin, like what are these things that make Bitcoin unique? And then I say, okay, what are the things that people do with money right now that Bitcoin negates or what business models don't work anymore because of Bitcoin's the way it is? A lot of the rehypothecation stuff, I don't think any of those risk models are going to stand up in a hyper Bitcoinization world. It makes financial services, I think, more boring, which I think is good. It makes them much more risk adverse, which I think is good. I've been doing some – I'm still early in my journey here, and I'd love to – if someone on Twitter can point me in some good directions, then I've been learning a little bit more about banking under the gold standard

and financial products under the gold standard. These ideas of buying a house with 10% down or 20% down, That is not a fucking thing. But in 1920, you know, you were either just buying with the money that you had, because you had to buy a house, or you maybe you could get you could finance 30% of it or something like that. Right. I think the financial products that we end up having are much more risk adverse in the future. And that what is a financial services institution look like it's providing all the different types of transactions you might want to do, whether that is a lending type transaction whether that is a savings transaction whether that is a uh you know

maybe we'll be you know helping people onboard people onto lightning um and making sure that there is a portion of their bitcoin that they don't want in cold storage that they want to be more readily available and provide those channels and hubs for them to transact out of um i think that basically everyone you know my theory on this is that everyone you see as a bitcoin company right now is going to converge on the same product suite. Some of them might be more focused on on-ramp off-ramps right now. Some of them might be more focused on storage right now, long-term storage. Some of them are more focused on peer-to-peer spending and transactions. But ultimately what a financial services company does is they try to facilitate all of those types of

transactions for their customers in the cheapest way possible. And the ones that do that are the most successful ones. So that's what our product suite looks like in the future. We're going to be a financial services company. And as Bitcoin is used in different ways by customers, we will have to react. I personally like starting at the custody point. I think it's the most important problem to solve first is how is the Bitcoin going to be stored? And doing that in the most trust minimized way and then you build on top of that um you build the loan products you build the uh the lightning um connections you build the on-ramp off-ramps and all that stuff but um that's kind of my view on it and i think we all sort of converge at some point

yeah you know it's it's going to be fun to watch it's so crazy being at this being alive at this point in time where it's still so raw but you can see like i wrote about it this week you can slowly but surely it's things are coming coming together it's getting easier to use all this stuff like the bitcoin wallet tracker software that was released this week so i heard about that yeah yeah makes it easier to connect your full node you guys dropping caravan makes it easier to set up multi-sig um the on and off ramps for as long as they're needed they're becoming more bountiful um it's it's an exciting time how lucky are we very how lucky are we to be doing this right now like uh you know i i think back you know dot com you know uh time you know 90 you

know most of the people that were making moves there had been thinking about this stuff since the early 90s they waited a decade to get to like you know really commercialize this and like you build real businesses on the internet and they've been thinking about this forever and um i remember i was just i was just a little bit too young i was in high school you know like uh i was young or I was in middle school really when it first started in 96 and then high school during the big boom in

98, 99 and I felt so crappy like four years later like I just missed everything like I wasn't a part of that and we get to do it like we get to do it right now you know it's the right time and you know the right age

the right time the right prerequisites sort of I know that you should jump on this early I feel so incredibly lucky to just like be doing this right now it's so cool no it's i mean it's i feel fortunate yeah lucky fortunate um grateful grateful yeah all those all those words um well thank you for all you've done for bitcoin thank you for what you guys are doing at unchained um one product request from this freak uh down the line i am uh interested in inheritance uh products making that easier um just some selfish some selfish uh product requests from from the podcast we we got we got some stuff

in store there uh we you know we already support it um you know if you have a you know a revocable trust or something like that you can set up a vault uh through that mechanism it's pretty simple to do that but uh you know maybe there's some more cypher punky cool bitcoin native ways to do that i don't know we'll take a look yeah we'll take that as a hint yeah fuck yes um matt do you have any other questions before we wrap up here no this is great i've enjoyed it as always um will i appreciate your time i hope i cannot wait i don't hope i cannot wait for the day where i come out to your to your wyoming fortress and go fly fishing yeah man uh you can come uh to the first wyoming citadel out here uh we'll have some uh some grass-raised beef goes to do some

fly fishing it'll be a fun time yeah i want to see you and parker do the uh the 900 degree sear oh yeah oh we we can outdo that now 1100 degrees yeah 1100 how long does it take to cook that sake like a minute and a half if that uh yeah if you sue v8 it's about it's under two minutes yeah awesome all right um where can we find you on twitter at at w cole or at will cole at will cole on twitter um yeah and uh yeah just no win cole cards it's coming that's something that's uh most people on twitter think you have long hair oh yeah that's right uh that's that's the last professional photo i had taken back in my stack overflow days uh i don't get a lot of uh professional photos but i do have short hair

now so yeah bring back the flow yeah i yeah i was about to fill this quarantine shit but finally got my barber yeah matt uh matt grows his flow out during bull markets he he likes to rubbing in people's faces that, hey, I don't care. Throw it out. As is tradition. Yeah. All right, well,

thank you for your time. Hope you enjoy the rest of your afternoon. Thanks, Marty. That's all we got today. Thanks, Matt. Thank you. Cheers.

Peace and love. Thank you.