TFTC: A Bitcoin Podcast - #244: DLCs, DeFi, Taproot activation, and milk cattle with Chris Stewart and Ben Carman

Episode Date: April 16, 2021

Join Marty as he sits down with Chris Stewart and Ben Carman from Suredbits to discuss: - The Austin scene - Migrations in the US - DLCs - Lessons from DeFi - Taproot activation - Speedy Trial - Coinflip - Milk cattle - much more Check out Suredbits Follow Chris Follow Ben 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. Lend at Hodl Hodl is a new non-custodial bitcoin backed lending platform, that allows peer to peer lending and borrowing between users, globally, anonymously & on your own terms. Create you offers & set your own terms on lend.hodlhodl.com Compass Mining. Compass wants to democratize bitcoins hashrate and give everyone the ability to strengthen the network while mining bitcoin profitably. Thanks to Compass, it’s never been easier to mine bitcoin. Check them out at compassmining.io Braiins. Braiins are leaders in the mining industry; running Slush Pool, creating firmware to make miners more profitable (Braiins OS+), and building out Stratum V2 to help further decentralize mining and make Bitcoin more robust. Check out their mining profitability calculator.

what's up freaks vibes are high in austin great bit deads last night hosted by the team in unchained capital great time meeting the freaks shout out to you freaks if i met you last night it was very enjoyable i love meeting freaks love hanging out with bitcoiners bullish on bitcoiners bullish on this episode it was an in-person episode first in person an episode in quite a while in some months and it's just something about an in-person rip that it makes the heart grow fonder for in-person rips all the time sat down with chris stewart and ben carman from the short bits team talked about everything dlc's speedy trial cows more cow talk more cattle talk more farming talk

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bullish on bitcoiners bullish on life you got to be optimistic you got to be optimistic things seem a little crazy right now getting like inflation it's coming it's here people freaking out i get the vaccine i wear my mask do i tell my family that stuff sort of creeps me out a little bit i know some of you freaks are having these questions right now i am too you know what we have bitcoin focus on bitcoin start building it's the beauty of bitcoin it's an open source protocol that anybody can contribute to and start building around, start building on, start making it a

shelling point of society. We're doing it, freaks. It's happening. It's happening. It's a beautiful thing. It's going to keep happening. Love all y'all. Enjoy this rip. You've had a dynamic where money become freer than free if you talk about a fed just gone nuts all 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's up boys what's up nothing much with me it's good to have you guys in town what's it feel like everybody invading austin it's good i mean i've lived here for a year and now i'm an og which is funny but uh yeah it's good to have everyone here especially this week we have 175 rsbps for the meetup for the bit devs meetup i was talking to will call yesterday He doesn't think we're going to be able to fit everybody in the office. Yeah, in our group chat for the meetup, Phil Geiger said,

we have vertical space if we need to. So, you know, go get on your shoulders or something. It's going to be a lesson in scaling. I mean, Marty, from your time in New York, what was the biggest BitDev's turnout you saw up there? Because, I mean, this has got to be pushing. I mean, if, you know, of course, I'm sure not everybody will show up. but uh what's the biggest bit devs new york you saw during consensus weeks that we get pretty

packed during bull runs they get pretty packed i think 200 yeah at one point you guys have like a lecture hall so yeah at myu uh it's beautiful to see what's going on down here i love it i'm all i've been here since monday chris literally just flew in uh from chicago i'm assuming yeah flew in from chicago landed at uh 11 30 and podcasting by 1 30 so and got a meal in between there so some efficiency in there what'd you eat uh got some uh enchiladas brisket enchiladas which were phenomenal it was absolutely amazing yeah i met uh ryan gentry at the taco joint yesterday uh and went back for more today that's what i had for lunch some taco joint good tacos down here i'm loving austin am i gonna move down here ben should i move down here how fucking yeah you

should everyone should i've been trying to get convinced this guy to move down here too every every week he's like man i'm jealous you guys can go outside yeah um you know it's it's two different worlds in america right now that's for sure uh i guess maybe it was like this beforehand but it seems even more apparent now when you come to places like austin uh from places like chicago chicago is starting to open up a little bit more but uh you guys are still light years ahead of yeah how's the covid cowboy doing covid cowboy in chicago oh he got canceled if we're talking about the same are you talking about the talking to the mic a little closer he got canceled if you're talking about the guy that was like riding horses like through

the streets yeah didn't he mess up the horses yeah it's a very sad thing um you didn't understand you need to put horseshoes on a horse otherwise their hooves uh will be worn down running on hard surfaces like concrete and he was you know riding them all over he was like riding them down an interstate at one point like maybe fleeing from the cops or something like that and then of course in her wisdom i think laurie lightfoot uh deputized him to be like the covid ambassador for chicago and then you know he gets arrested three months later for inhumane treatment of animals so yeah they had they euthanized the horse didn't they yeah i i don't know about that uh i thought i heard you know it went to the farm but sometimes that's a euphemism so yeah i went to the farm in heaven

yeah rest in peace um but yeah i don't know chicago is chicago uh it has a lot of other big city problems and we'll see as austin grows if you know which way it goes is it going to embrace that more kind of the statewide ethos in texas or is the the the people that are moving here gonna affect the culture in such a way that it just becomes san francisco in central yeah like i feel like i need to move to texas to help save texas right from the onslaught i like i like to think we have some resiliency or like you know if like because a lot of people like you're leaving sf it's like okay i'm going to austin denver or like seattle portland and a lot of people like you know they hear like austin text like oh texas though like that's where all those cowboys are i

don't want to live there so we kind of have that resiliency where people don't want to come here but i mean you can still see a ton of blue hair chicks here so we'll see so like just again like the people listening i've been here for two hours i did see one cowboy hat cowboy boots he looked like a honest to god cowboy so i was encouraged by that me and my girlfriend were taking bets how long it was going to take to see somebody like that so uh um that was refreshing to at the airport no it was it was actually just walking up and down i think it was like fifth street maybe i don't know the streets but yeah yeah we got in monday afternoon and noon didn't get our airbnb till three so we had to go to lunch downtown and i saw like the most texas dude ever he was like a

lawyer wearing suspenders and he had one of those beards that were like curling up on the sides the mustache that curled up i was like oh sir i'll declare that's awesome the nice thing about austin i i mean you know i hope this is like you know what i would plan for it in my mind is like it becomes a little bit more it allows the tech industry to say have like a different sort of culture associated with it than like the dominant east coast west coast super liberal like cultures that you see throughout basically the entire tech industry and like bitcoin's like actually interesting i think in this regard because there is some um differing viewpoints uh within the community itself whereas i feel like in the broader tech ecosystem they're i mean really

it's like a monoculture of um you know like kind of like west coast values i guess you'd say yeah i mean we had a prime example of this this morning on twitter i mean obviously the the bitcoin carnivores are a huge demographic within the bitcoin space but the vegans love bitcoin as well the official vegan account was uh shit posting and responding to chris dixon about the coinbase ipo yeah i saw that they're like woke they're like fuck coinbase views river and swan i was like oh hell yeah i know there is like vegan like i think matt corallo at one point was a vegan i think he still is yeah is he uh yeah whenever i'm on a bitcoin vegans whenever i get lunch at matt we have to pick a vegan restaurant yeah with like the cultural stuff it's like again

i don't want to like shove you know other differing views out but it's just like let's have both sides of the spectrum instead of like just being totally dominated by like these like again like west coast uh kind of san francisco values that you see yeah completely detached from reality in middle america they hate middle america they do i mean i actually do kind of believe that as someone that has traveled frequently to the coast from middle america you always get it's like same thing as southern people encounter frankly is like you know if somebody has like a southern draw usually you kind of have those stereotypes come up in your mind is like dumb stupid southerner and like you you kind of get those um condescending views or

maybe it's all in your head i don't know like i guess you can argue that too but uh yeah it's good that there's differing viewpoints within a industry as important as bitcoin and hopefully we can get that out into the rest of the tech industry i agree now somebody who's lived in the northeast in the Midwest and the southern part of the country. It's beautiful how there's different types of people in different parts of the country. It's what makes us strong. I hope Texas doesn't get bastardized

by San Francisco moving into Austin. I don't think it will. Texas has a ton of other cities, and Austin is just one. Still got Dallas and Houston to keep us sane. And I guess if you don't have the Texas viewpoint, you can always move to Portland. Go to Portland instead. Are they trying to throw the cops out in Portland?

I'm not there, so not my problem as far as I'm concerned. Well, that was fun culture talk to start off this rep. Boy, is this my first in-person interview? I haven't even done one with Matt since BitBlockBoom, I don't think. This is the first in- Oh, wait, no, we did Arbed Out on Christmas, around Christmas. So it's been about since Christmas. since we did a four months an in-person interview feels good feels right thanks for coming to the

airbnb by the way no problem thanks for coming last again like chris was on the flight he was like a i dm'd him literally as you're sitting down i imagine yeah i know i was on the like they were pushing the plane back and i was like i was again like today is the coinbase ipo day for some reference and i was like looking through twitter being like okay what's going on with that and uh trying to see what's happening and then i saw your dm pop up i'm like ah heck why not if my girlfriend doesn't kill me of course so yeah marty's dm to me was hopefully chris buys wi-fi on the plane so we can figure out a time chris did not buy wi-fi no i mean planes are great hacking times it's like you're just uh away from everybody you got an outlet you got your laptop

and uh i was working on some dlc uh infrastructure stuff uh behind the scenes so well thank you for providing a perfect segue into the dlc conversation what were you hacking on particularly yeah so um so for those that don't know i guess i think it's been since january or maybe december since i've been on anyway um we've released a product called the oracle explorer um it's a way to find oracles for your dlcs for those that don't remember uh dlc stands for discrete log contract it's a way to do bets on bitcoin derivatives on bitcoin any sort of a speculation you want to do you can do it with dlcs however you do need an oracle to attest to the thing that you want to speculate on so this can be a football game basketball game etc and um so we've released

a product called the oracle explorer at oracle.shardbits.com to aggregate these oracles so people can find existing ones for their bets. The next step in this kind of infrastructure is allowing people to find popular contracts that other users are doing on the Bitcoin blockchain and allow them to customize it in just a little way, such as maybe you want to put more money in the contract or less Bitcoin in the contract,

and then keep all the rest of the parameters. and uh this is kind of coming out of something that's in the contemporary uh news i guess between a bet between uh american hodl and peter mccormick and maybe uh ben wants to ben's the oracle on that are you the oracle are you uh no you're not the oracle but you're setting up the contract aren't you yeah i think chris or shirt bits will be the oracle but yeah that asshole made a bet without us knowing and was like you guys are going to need something peter mccormick ready and we're like well shit so yeah for the last like few days i've been grinding on the gooey trying to make it pretty and we've made some good progress i sent chris a video of what i

got so far and it's it's pretty decent now but what's what's the the bet itself oh the bet is um if bitcoin hits 300k by end of year or by the ball drop on in new york and um for a bitcoin and if it does hodl gets it if it doesn't peter mccormick gets it so they're locking up 100 million cents and winner winner gets all yep yeah three hundred thousand dollars hodl wins less than that peter wins and it just has to like wake up like it doesn't matter the day of it's just like if it does at all during the year oh okay so it's an intraday wick yeah no daily close or anything like that yeah you can get just at any point in time if it breaks three hundred thousand dollars on coinbase american huddle wins and if by january 1st 2022 the coinbase

bitcoin price did not exceed three hundred thousand dollars peter mccormick would win this one bitcoin and kind of you know circling back to the tooling aspect of this is if other people wanted to enter into this bet say not just peter and american huddle but maybe me and ben or other twitter users that are following peter and american huddle you know we're working on infrastructure to make that easy to do at least on the contract front so you can like clone their contract almost like you clone a github repo or copy it and you know maybe you don't want to bet a half a bitcoin on this or a whole bitcoin on this but maybe you just want to do 50 000 sats or 100 000 sats and uh do a little bit smaller of a bet but you can say i mean i'm in it with you

american hodl i think bitcoin's going over 300k or the inverse of that is you know i i like peter mccormick and his lavish lifestyle and i think he's gonna you know win this bet so uh um yeah just uh trying to facilitate that is the tooling we've been working on i don't know if this is uncouth to ask you ask you guys that you're playing the oracle but like whose side are you on i think i was gonna win you do by a long shot but uh you think we're gonna hit 300k this year we're going to have 500 K at the end of the year and then Parker's going to buy me a steak. So that's my prediction. Well, you know, like some other like tooling we can possibly put around this

stuff is like, you know, the implied volatility that's needed to, uh, you know, get to 300 K from, uh, the, you know, spot price we're at right now, which is like 62, 63, some, somewhere in there and, uh, you know, put live odds on there. It'd be really fun to, you know, make this as social as possible with the tooling and uh you know allow people to share and follow the bet and that's something in the dlc ecosystem now that we're getting a little bit more on more solid foundations on the protocol level we can start you know building a little bit higher in

the stack and uh feel more confident that this you know ground isn't going to change out from underneath of us when you say protocol level are you talking about the bitcoin protocol or the the software that you guys are building particularly? Like the DLC protocol. We're kind of at the point where Lightning was in early 2018 where there's four nodes on the network and there's just kind of a Lightning network, but it's all command lines and not easy to use.

And ideally, we'd like to get to where Lightning is today where you can download Breeze on your phone and just scan a QR code and go. But yeah, we're getting most of the initial protocols mostly done, or at least we know what we need to fix, which will probably be done probably by summer. or like end of summer, hopefully. I don't know.

Yeah, I mean, one of the big pieces of work that just got in is something that Jesse Posner and Lloyd Fournier have been working on for quite some time, which is these things called ECDSA adapter signatures. And, you know, technical buzzword out there for everybody. But this is the cryptographic tool we are using to power DLCs in previous iterations we were kind of you know we had something working

it was good enough for proof of concepts and demos but we would prefer if you know some lower level C and cryptography experts vetted this stuff and made sure that it makes sense and so Jesse Posner did a lot of legwork on that and just recently within the last week or two that actually got merged into the secp 256k1 zkp library and is now like maintained like all the other features in secp so uh that that was a big milestone for us now uh for all the library developers out there or wallet developers out there they can hook in and get access to these cryptographic tools that they need to be able to support dlcs in their own wallets rather than you know having to use the shirt bits wallet or the crypto garage wallet we really want to hopefully get dlc supported in

every wallet so that you know you don't have to have 15 different wallets where one you know supports with this one feature you want another one supports another feature try and consolidate that stuff so hopefully that increases adoption of discrete log contracts as well i'm very excited about all this like you just mentioned uh the ecdsa adapter signatures how how much developer attention uh has has been dedicated to this recently is it growing i guess that's the question i'm trying to make like you guys seeing people come help you build this out there's a lot like lloyd wrote the paper on it when like 2019 yeah some somewhere yeah and uh they made like an initial like you know just proof of concept like branch that we were working on for like the last

while and then um they officially like started working on like the current spec that just got merged probably for the last like six to eight months and uh yeah now like that pr like it got reviewed by like andrew polsha like you know real or random like nick jonas and nick like tons of like you know really good cryptographers in the bitcoin space so it's really cool now we have like this really well fleshed out highly reviewed uh thing done and um so now we can actually use this and get other people to start using it and it's really nice to see yeah so what happens if taproot gets activated then we have to do this all over again and start using schnor signatures instead that's how you say you can't prepare for that or it doesn't so like uh um the ecdsa adapter

signatures were needed because bitcoin didn't support taproot and you know trying to build things around when a consensus feature in bitcoin is going to activate is risky business to say the least um going back to what ben was mentioning with the lightning teams in the 2017-2018 era they needed Segwit. So they were predicating business models around, okay, when is this Segwit feature activated? And we all know how dramatic that was. So really we were looking for, can we do this without having to wait for Taproot and Schnorr to get activated? And ECDSA adapter signatures were a venue to do that. So now, I mean, I guess Ben is following the Taproot stuff a lot closer than i am but we aren't like hard blocked on uh taproot activation to uh you know

keep dlcs moving forward and um you know also you know other blockchains that may not have snore taproot for whatever reason you know they can use ecdsa adapter signatures if they want on their respective chains so um yeah it's it's one of those things that it just is really tough to update the bitcoin protocol and that's not a knock but it just is um and you know guessing when that's going to be is not a very fun cave yeah and even if if and when it does get activated it's going to take time for all that stuff to get implemented in walls and stuff like that correct yeah yeah definitely like you know if taproot was activated tomorrow like we'd have to spec all the new stuff out to use taproot and then you know write that code verify it and you know get it

deployed and you know probably a lot of wallets can't even send the taproot like once it's activated so there'll be a lot of time before we can actually start using it yeah all right taproot coin flip you're you're a coin flip fan i've been going back and forth i slept on it didn't like it then we did rabbit hole recap last week and you were in you were in the comments saying the coin flip's good yeah i think i don't know i think a lot of like it's like honestly it has a terrible headline like trillion dollar network decides you know consensus issues over a coin flip yeah so break it down for the folks out there who aren't aware of the the whole situation like tap reactivation has been it's been a journey this uh this this week or this

this year so i know we originally started out with uh bit bait versus bit nine and then most people are like let's use bit bait which is uh basically just using block height versus um you know like real world time that's determined when we're starting our activation period period. And then we decided do we want to lock in on timeout, true or false? Do we want to force a UASF at the end of this thing? And if you don't know, that caused a huge schism in the entire dev community where it was like split maybe 50-50, sometimes 75-25, and basically just everyone arguing and arguing, you know, and then saying, like, you're going to cause a chain split? No, you're going to cause a chain split. And lots of emotions

going on and stuff. So then someone proposed speedy trial, which is a different way where just like a three-month activation and so it will fail quickly. Then we can figure out if it doesn't work, then we can figure out something else. But more than likely, Taproot is going to activate really quickly. Everyone supports Taproot. Most soft works besides Segway activated in the first three months anyway. So more than likely that will work. And then the final part of the speedy trial was figuring out, you know, do we want to use block height or real-world time to determine our activation period? And then more bike shedding again where everyone's arguing, like, you know, the super, super edge cases that are possible for these things. And basically, I think Jamie Rubin proposed that he was like, you know, we're all just bike shedding.

Why don't we just flip a coin? Like, honestly, like, we did, like, a poll, like, you know, who would be okay with either? And, like, 90% of people are like, yeah, I'm fine with either. There's just, we're bike shedding here. So we did a coin flip, real-world time or medium time past one. So now Andrew Chow closed his portal quest for Blockite. And it looks like, like, speedy trial is, like, happening in, like, two weeks now. Awesome.

So the proposed activation start time is April 24th. And then, so the following difficulty adjustment period would be the beginning of activation. So let's see that, like, you know, in two weeks or something. Let's go. so yeah it's happening now like we finally did it it seems well let's talk about the actual coin flip too because i thought it was really cool you used the bitcoin protocol yeah to basically initiate a coin flip yeah there was like a i forget what block height it was but some block it was like you know in 20 blocks we're gonna you know to see if the last bit is zero one if it's

zero we use you know real time it's one we use block height and you know it was zero so we did it and like it was nice we had like a basically fair way to do it you know maybe the miner threw away a block because they wanted block height instead of you know or you know but i don't think that happens yeah what a crazy world is this a bad precedent to set i was arguing with shinobi about this he thinks it's a terrible precedent to set but i don't know i think what's his argument basically we like you know for a trillion dollar network we shouldn't decide uh protocol decisions on coin flips which is probably a good idea but i think like the way i see it like speedy trial was a way to stop bike shedding and this and then you know by and large

this was a way to just stop like people bike shedding from each other so like we're just trying to get this thing through like taproot is like by and large everyone agrees that we need it or not not necessarily need it but you know there's no downsides and this thing is a humongous benefit to the network so why not activate it and like first i'm going to argue over how to activate it for these super super niche cases that 99.99 chance won't happen like let's just get this thing out there because you know people want to use it what were some of the niche cases that people were bringing up well it's like so since we're using um if you use time that uh has some you know weird things or like since the miner sets their own block time in their block they could

like do some weird thing where like they you know change it and then um reorg themselves and move it in the past or into or into the future and then that could cause issues where like you thought is going to activate and now it's going to activate two weeks later instead and someone broadcasts as a taproot transaction so now their funds get stolen or something and like to maybe make a parallel to dlcs here is like bitcoin has no notion of time like time is something that we humans like understand and like we have a clock on the wall or whatever but the bitcoin protocol itself has no idea if it's like june 1st or december 25th we have to like you know build in rules to the protocol that make sure we have you know atomically incrementing time over time if

that makes sense and so there's this whole bit that i think mark friedenbach wrote to make sure that this is the case so that applications like time locks for instance which we you know are familiar with actually work um and generally you know when does i'm on the block height side of things but uh so when you're designing a protocol with like wall clock time in mind it's very hard to think like okay but the time on my wall is actually you know 6 p.m but the bitcoin protocol might think it's 5 30 p.m or it might think it's 6 30 p.m depending upon how miners are setting those time stamps in their blocks so this is trusted input from miners every time a block is mind just like with discrete log contracts you have an oracle that is attesting to something

it's a little bit more complex than that but maybe for people out there that are newbies and just trying to understand this stuff um that maybe is a decent analogy yeah so like the rules around the the time stamp in the block i think is um like the average has to move forward and um most nodes will reject a block that's like way too far forward so like they can you know they have like a pretty big window where they can mess with things so um that's where like the block height argument comes in because that's kind of how where bitcoin determines you know its time is really the block height but the problem is um it's terrible for test networks where um signet there could be multiple different heights and um that it really doesn't work and then for testnet there's a bug

in it where um sometimes there'll be like 10 000 blocks in a day so um you know we could say like oh it's going to start on april 1st and then you know we get 10 000 blocks in a day and now we totally missed our window so you know there's different problems there why does the test net matter for this doesn't need to that's the argument but like um that was my argument i know like luke dash jr and a couple other people like said that like you know we should pick the best thing for main net and test net should you know like you know assimilate to what main net does but i think i know aj towns is saying he was on the other side saying you know these tech these test networks are important and um you know if i want to test something i should be able to

test it reliably on this network so we make sure we're doing the correct thing on mainnet all right i don't care about testing at all but i'm not a developer so my opinion probably doesn't matter in that those regards that's something i wanted to add to that the uh well i think at the end of the day ben's right is just pick something and like let's keep this thing moving forward like i think it's a little hyperbolic to you know say that like a that that's like that seems like it'd be a new york times headline it's like trillion dollar bitcoin network you know solves problems with coin flips or something like that and i think it's you know yeah like by and large they're both like perfectly fine um and you know we had to pick

one and this was the best way to break the sand still i think so i think i'm i'm glad it happened to now like you know like i said in the next two weeks this thing's actually happening so you know if we didn't do this we might you know be like yeah maybe in two more three more months we might have it but now we have like a real timeline that's happening yeah and yeah so i'm pro coin flip again i remember what i wanted to say even in that edge uh sort of scenario that you described but the miner like reworking itself like the probabilistic nature of getting a block too would make that like a low probability event right because you can't guarantee that a miner's going to mine two blocks in a row yeah it's pretty like it'd be a hard attack to pull off

and there's not a huge incentive to do it like no one's doing taproot transactions the day it comes out so like unless you're a god like peter woola yeah like it's a super super niche thing to do so i don't see a reason to like like you know we should care about these things but like it's fine to have that very small small don't let the perfect be the enemy of the good right yeah good enough yeah exactly like you know bitcoin's not a perfect protocol but uh you know it's the best we got so let's just use it yeah it's so good right now all-time highs all-time high boys yeah i mean it's uh so someone i guess i've been through two or three of three of these now um always it blows my mind every time it's like god i've seen this before but it's still

going back to that american huddle peter mccormick bet it's like you never know with bitcoin i mean if there's one asset that can do it it's bitcoin and especially with the the kind of momentum and steam we have behind us now with the coinbase ipo seems like everybody and their mother of corporations is like dabbling with bitcoin um it's like i mean marty like for people from five years ago this would be like the best case scenario i think i could like possibly imagine um maybe you know maybe there is a few more but it's pretty damn good uh like with what things are right now in my opinion anyway yeah i was asked i was on a cedric young uh youngman's podcast yesterday the bitcoin matrix podcast and he asked me like are you sure like are you

stressed out about the future of bitcoin at all like how does this compare like bull markets of years past so like i'm not stressed out at all like i've never been more confident like remember 2015 2016 that bear market like people legitimately thought bitcoin was going to die like i think we've hit a tipping point particularly in the last 12 months where there's no turning back try starting like a bitcoin company in those times it was not fun blockchain is where it was at not bitcoin though but that's kind of changed i guess yeah well that's that's a debate i've been having i had a last night with uh alex gladstein and jimmy song i think it yeah it's like is this time different i know i'm gonna like time stamp 30 minutes 31 seconds plus the ads of

the intro uh to this podcast recorded on april 14 2021 marty said this time is different he was wrong but is this time different the uh i mean it's just the culturally the acceptance of bitcoin like the amount of and so that's the conversation we got into last night like just the price goes to such a level that's what jimmy was saying and like how how these crashes happen that there's just not enough inflow to to basically eat up the new supply of bitcoin coming on the market to to hold up the price at those levels but it's like i think like this time i think what this chip shortage might be like influential in that though because like now right now miners are net buyers of bitcoin and like you know difficulty is not going to track price um like it hasn't at all

so far and it doesn't look like it will so we like if we hit like you know 500k like it's not like miners are selling you know like a million dollars worth of bitcoin every block it's like you know the difficulty might only go up another like 10 20 percent by then and they could just be like pocketing all this cash and there's like not that new supply isn't you know diluting us as much Well, that was another part of Jimmy's explanation of why we probably will have another big crash, because the miners, particularly the big miners, will try to squeeze out the smaller miners by pushing the price lower and try to drop their profitability to unprofitability and then seize up some of the market of the mining share, at least,

which is an interesting theory. But again, like it's hard to imagine like all these big players selling Bitcoin, all these retail investors, the combination of like the acceptance in the mainstream and what's going on in our political and monetary system. Like it seems, I don't know, maybe I'm biased because I hate it so much and I hope this to be true, but it seems like people are losing confidence in the political monetary system rather quickly. i think it's definitely true like i mean even just like dogecoin being normalized kind of like makes bitcoin normal and now like you know if you tell like a random person on the street like oh yeah i work in bitcoin they'd be like oh cool it's not like what is that are you a crazy person like you know you know why are you financing terrorists yeah exactly and now it's like oh that thing that elon does and uh you know oh i heard about you know that thing went up good job and you know

it's kind of cool where it's like it's crossed the overton window completely well and like going back to culture stuff it's like bitcoin has that weird cultural aspect to it it's like kind of counterculture kind of cool at least my what i tell myself again so maybe it's just me projecting but uh i do think it has that countercultural like aspect to it that uh can be really attractive to people too it's like outside the system and you know all this stuff i i want to see like you know the hollywood industry get behind like telling all the amazing stories that's happened over the last 10 years in bitcoin and get away from nfts and like trying to sell those things but i mean there's so many good stories like i think in the the bitcoin or even

the wider cryptocurrency industry that uh can really also just help raise its profile like you said elon musk like you know him just tweeting about bitcoin just legitimizes it so much i i think in tesla buying 1.5 billion dollars worth of bitcoin like that is i mean again like going back five years ago it's like yeah if you told me tesla is going to buy 1.5 billion dollars of bitcoin i'd be like well first off tesla is not going to be in business in five years and they sure as hell aren't going to buy 1.5 billion dollars of bitcoin because bitcoin's worth 1.5 billion dollars i think all of bitcoin is worth 1.5 billion dollars and just like going back to the 2015 days and just a little anecdote back to coinbase like coinbase raised i think 75 or 100

million dollars from goldman in 2015 and again bitcoin was worth one or two billion dollars i think when they raised that money and now coinbase today is ipo-ing for uh like a roughly 100 million maybe 200 million dollars and billion billion oh yeah sorry billion excuse me um and all of bitcoin is worth one trillion dollars so you see like this kind of ratio is the same between coinbase's fundraise back in 2015 and uh their ipo today in the bitcoin market cap so um i you know i don't know what that means if there's any interesting information to glean off of that but uh funny anecdotes anyway yeah and that's another thing i think people severely discount particularly like people who bash lightning and bitcoin scaling and in second layers and stuff like that number go

up really provides utility to these second layers and bitcoin in general right like that like i was it's super helpful like my lightning wall on my phone is just like oh now the you know that's 5x as much money on it i you know i don't need to worry about channel balancing as much anymore because it's everything's just worth more so i can send 20 a lot easier right imagine if that eric wall a ryan gentry bet happened uh and a hundred thousand dollars like with that i mean he pussy He dragged it out, Eric Wall did, and made it very gruesome for the Lightning Network, I guess is a good word to say. But sending $1,000 would be significantly easier. You're just sending sats, right?

Yeah. That's the other knock. People not understanding how to, I don't want to say value Lightning, but basically determine whether or not it's being successful. like they look at just the pure uh amount of liquidity locked in channels where you can like they don't understand that like it's beautiful that you you have sort of a static amount at least in public channels and people are just getting utility out of that static amount of bitcoin on the network like i i set my my channels up for the tftc uh node for our store on our website two years ago and i haven't touched a thing and it just works we're able to receive and um like i'll

i'll top up our ads on on bitcoin bounty hunt like every once in a while that happens automatically uh yeah it's it's like when the number goes up like lightning i think is gonna get really interesting and we're also so early on lightning like this thing's what like three years old like when bitcoin was three years old people were writing individual private keys on pieces of paper like you know now we have like biff nine seeds and like all this fancy you know seedless stuff and multi-sig like you know like 10 years down the road lightning's gonna be like super super seamless and a lot better to use it's just you know we're so early on this protocol and there's still so much stuff we have planned like you know like l2 and you know ptlcs all these

fancy stuff that's coming it's just you know we're so early on on lightning yeah how early are we on dlcs oh so much 2017 lightning or 2010 bitcoin i guess is probably what uh we'd say um you know dlcs are interesting because if anything people love to do in crypto speculate and uh that uh And give us people the tools to do that for the stupid Twitter bets like Peter McCormick, American Hoddle, or whoever your friendly Twitter troll is. You can at least get them to maybe put their money where their mouth is in the future, but we'll see. Even you, betting on the election. Yeah, I mean, I bet on the election, I guess. I bet on Joe Biden winning, and I got a 0.4 Bitcoin out of that.

So I guess Joe Biden did something for me, that's for sure. 40 million sats. 40 million sats, sorry. Well, that's another thing to take into consideration. We were talking about Tesla. I think it's cool that they bought $1.5 billion, but I think it's even cooler that their engineering team was focused on patching a bug on BTC Pay Server.

Is there going to be a Cambrian explosion of engineering talent just from companies that are getting financially invested in this asset that are looking at the protocol and contributing to different areas of the ecosystem, if you will? I mean, I think so. So, I mean, again, as they get skin in the game, they have to. You don't want to be the Tesla engineer that has to report to Elon Musk and say you lost $1.5 billion of Bitcoin, that's for sure.

So, I mean, yeah, as all these institutions get skin in the game, that's going to be the case. And that's great. I mean, that's what we all want to see. It seems like, you know, there's a lot of funding out there for developers these days And that's going to benefit all of us later on down the line with improved tooling, improved protocols, better security on all this stuff. So that's really an underappreciated part of the industry, I think, is the amount of security that needs to go in to, say, secure $1.5 billion of Bitcoin or work on a Coinbase custody team or any of these big exchanges' custody teams. like it's no joke you cannot do things quickly or best even to not change things at all because

assuming that the thing you work you have works um changing anything introduces risk and risk is really bad in those setups yeah yeah again i think this time is different freaks i think it is like a cultural tipping point i guess just accept it like jim cramer being demanding to be paid in in bitcoin he's actively i mean not to like i put a lot of which way the wind was the wind blowing today that's what jim cramer will say yeah exactly i guess he's a but the norm but the normies take what jim says and they yeah like oh bitcoin's okay this is supplanting gold like gold that's demonetizing gold in real time we've printed like 10 trillion dollars in gold it's down cents like that's pretty that's pretty hilarious it's

pretty damning yeah so has there been any takes outside of the bitcoin take of why gold is performing so poor i mean like is there any other arguments to why gold has sucked recently rather than just bitcoin is eating its lunch i would think the gold buds will say you know oh it's manipulated paper gold markets, blah, blah, blah. Okay. They would say that. Forever. Your Keynesian MMT would probably say,

well, inflation isn't the CPI inflation level isn't where the gold bugs were saying it was. So investors are looking at that and they're not putting their money in gold. I would imagine that's one of the arguments that they would put out there, even though it's blatantly false. There's inflation right now.

Have you filled your gas tank recently? It's insane. or bought wood all right lumber yeah i mean going to the farming stuff is even commodity prices are up and uh corn soybeans wheat just even my favorite barbecue place here the prices have gone up six dollars per pound for brisket since i moved here what yeah it was 20 it was used to be 20.99 now it's 26.99 wow that's 30 almost 30 yeah it's really good brisket it's still worth it but it's like i don't want to spend all this money damn so that's the other thing right like this time is like are we in the beginning of a hyperinflationary event that's what we're talking

about last night too like is it already here like what are we going to be saying in 12 months like how crazy are things going to get and we got bitcoin so we'll be happy either way but i don't know i hope i hope it doesn't get too bad here because a lot of bad stuff can happen i don't want to see that like even if it you know benefits me financially um you know that's it's just so bad for the the citizens of a government to go through that and uh you know there's plenty of examples in the world for that and hopefully we aren't at that extreme in the united states i agree with everything you gentlemen are saying but what if we are i hope not too but we'll get out to rural texas go make some friends with uh whoever has guns out

there and cattle and uh 3d print your own guns 3d print your own guns there you go well yeah how was the uh the guns of bitcoin conference it was a ton of fun i uh shot a million guns and uh got really sunburned but i learned so much like like getting into bitcoin you know like you were first getting like oh it's this you know fancy alt currency basically and then you you know start reading like oh this thing is it's humongously studied topic it's so much deeper than you ever thought i like had that same experience with 3d printed guns this weekend we're like you know i thought like oh yeah people just like redesign and remake the the part that you know smith and weston makes and uh you know they put into their gun but like no these guys are

trying to make guns 100 3d printed and like you know they're making guns like you know you just go to lowes buy a couple pipes go home 3d print something and now you have a entire gun that is accurate and shoots like a real gun and it's crazy how like how much work they put into it and like how much they do to make it safe and yeah they have a lot of really cool stuff there are these people terrorists or are they just freedom loving americans um i mean some of them seemed a little crazy but they're all uh they're all definitely freedom loving this is an honest podcast everybody i mean like i mean there's a bunch of crazy people in bitcoin too but like you know at the end of the day we're you know giving just people access to like freedom

technologies which which is there shouldn't be anything wrong with that yeah i mean with any new technology like you can kind of tell if you're on the right path of something if there's at least some there's no crazy people that's like kind of boring like you need to like you know whenever maybe you know we move on from bitcoin in 10 years we don't want to work on it anymore it's like i'm going to wherever the crazies are like at least some crazies because they seem to find the unique innovative ideas that are like worth working on and uh you know they're crazy still but uh we that's something i want to see come into the world and whatever tool set that i have like you know maybe i can help get that there and uh you know whatever the topic is i guess but

yeah i think we're still gonna get the crazies in bitcoin in 10 years we got a long way to go boys a long way to go oh my god too long 10-15 years and we're mostly done like how do you how do you view short bits like a company you're going to work with and on for the rest of your life? I mean, rest of your life's a long time. But yeah, for the next like 10 years,

15 years, I think easily, you know, whether we IPO or sell to another private company has yet to be seen depending on what the discrete log contract ecosystem brings us. Something I've been thinking about a lot lately on that front is like, you know, kind of institutional size derivatives between,

you know, big players like miners and hedging whatever risks they want to hedge and retain some sort of custody um one question i wanted to ask you on this podcast marty is what does uh non-custodial mean to you what does non-custodial mean to you it means i have i know where you're taking this right like i could have a key in the two of three yes but i don't don't you definitely don't have custody that's not custody that's just that's just a visibility well i think this is from the atomic finance discussion right yes because so they called their their product they're working on non-custodial and it's you know you're setting

up a dlc and the oracle can you know sign a message and you know execute your dlc but it's like you know you're half like the counterpart is the only ones that are actually holding the the keys on the blockchain and they have this third party oracle that can you know create transactions they have otherwise valid to broadcast and you know essentially make their funds move but it's like you know since you know say like me and chris are in a bet like we're the only ones that are actually holding these keys so are we you know do we have full custody of it or does that oracle part of our custody it's like the oracle can only move funds but they can't pick where the funds are moved to uh well the address that the funds are moved to you can only sign a

transaction that they can only broadcast a signature that the people in the dlc can use to complete a transaction so like for like the american hodl um peter mccormick but like say chris is the oracle he can only sign a message to say you know that the price is you know upper below the 300k level so you can only say like the funds will move to here or here he can't just be like you know the funds are going to my address screw you too so like he kind of has a say in where the funds go but also he can broadcast that signature and you know he say like the price does go over 300 and he signs that it doesn't hodl and peter mccormick could be like well chris lied let's just close it ourselves and give it to the right person well that was gonna be my question

really get what if the oracle gives bad data you can just yeah it's a multi-sig the end day so you can do whatever you want gentleman's bet yeah um so it's like i mean it is an interesting um semantic argument i guess is what it is at the end of the day is like what does non-custodial mean um some people seem to think from my understanding online is like non-custodial means i have unilateral custody over my funds which is custodial in my opinion it's just i'm the custodian um whereas non-custodial maybe means nobody unilaterally can pick where the funds go to after the contract is set up um i you know that that is at least where i'm at on this like are you i guess maybe another question is what i'm saying is it makes

sense and like does the argument uh hold water you think yeah no i see what you're saying because it's uh it's really tricky i guess so you predetermine where the sats are going when you construct a transaction right hey if i win send it to this address if peter wins send it to his address so you're basically just taking a hash of an outcome or a hash from an oracle that represents the the outcome and using that to direct to the funds to the predetermined address is that and yeah so it's like schrodinger's custody right nobody has custody until the hashes actually maybe just maybe uh something more basic is like if you're in a one-of-one like pay-to-pub key output um do you guys agree with me that it's custodial but you are the

custodian self-custody right yeah i guess technically but like i think i think that's very important because i think a lot of people think that means non-custodial but that's not really the case it's you are the custodian yeah we're getting into a semantics argument i think you're right right there's there's some vernacular it needs to be fleshed out here like you somebody is custodying self-custody so i think self-custody that's probably a better term than using non-custodial in that context um like non-custodial i think is you know in the context of multi-sig like you were bringing up marty is a great example of that is like non-custodial really means nobody can unilaterally move funds from an output on the bitcoin blockchain including yourself including

yourself um that's my thoughts on that anyway i wanted to so would you say like say like me and you have a two or three multi-sig i have two you have one you would say that's custodial then because i'm the i would say yeah you are the custodian in that case yes i can hear some freak screaming well then i guess then i guess you have to get to like so it's all i guess we have to add like centralized custodial custodians right i think that would be the other term that's well like say if that's what most people think when you say custodial it's third party centralized custodian yes so like you know if i send my funds into coinbase or whatever like they're definitely the custodian like i don't think anybody's going to argue

that coinbase has unilateral control like maybe with things like i don't know if bitgo still offers like multi-sig solutions where like you know they hold one key or you know there's various other companies that do it too um yeah that would be non-custodial in my mind i guess yeah i think uh self-custody that's probably the better word to say yeah because that means that you know i have i can control the funds maybe that's what atomic finance should say like does that make sense like do you have self-custody of a dlc well i mean i think what atomic finance was saying was accurate it's non-custodial but i think the people that were arguing with atomic finance think that uh non-custodial means that self-custody yeah exactly

so it's like you know one of these very kind of stupid like nuanced things that it's not stupid though it needs to like you know we just need to make sure we're using our terms correctly i guess in my opinion like you know i guess i'm shilling for screen log contracts too so maybe i'm jading people's views here but uh everybody should think about it i guess that's what i've been thinking about a lot lately think about it freaks i mean it does make sense right so non-custodial would be like a dlc setup where nobody multi-sig where the keys are equally distributed so that nobody can unilaterally move funds that's another example of non-custodial lightning is non-custodial well i would have to think about you have like your pre-signed

like commitment transactions that you can broadcast so right so i close the channel so would lightning be custodial where you are actually self-custody yeah it would sorry yeah it would be self-custodied but not non okay this is a fun little argument i guess we're having i'll have to think about this more especially with lightning that's a fun one i guess it's like you could say an htlc's maybe themselves are non-custodial possibly but also like you know you could say like your on-chain funds are self-custody but like to send over lightning you still need cooperation between your counterparties of your channel so you could say that is non-custodial okay but the actual closing of the channel self-custodial yeah

Layers to this Layers to this A lot of nuance Yeah Don't at me At Ben When When people get angry

At me for saying this Yeah It's so fascinating Back to DLCs though Like one One blog post That Ndaw put out recently That I wrote about in the event

It was really fascinating Was your work on Multiple oracles And Yeah So you got What did you guys do Pierre

It was a price bet Between you And Roman i mean the dob did the bet and we had uh pierre fitfinex and chris as our uh oracles yeah we bet on the price and you know settled it with you know two or three oracles which is really cool yeah so break it down for the freaks yeah so just uh i mean think about multi-sig uh you know traditional multi-sig setups two of three um you know you need two of the three signatories on the multi-sig to

create and issue a valid Bitcoin transaction. The same concept we're bringing to DLCs with oracles. Instead of just having this one oracle that we just kind of argued about this custodial, non-custodial, self-custody stuff with, we don't want to

have that single point of failure on the oracle front if we can avoid it, or at least give people the option or choice to use multiple oracles if they feel more comfortable um you know distributing trust amongst those oracles so uh with the dlc demo that we did you know we had two or sorry we had three oracles and it was required that two oracles agreed on what the bitcoin price was to be able to uh move funds from the discrete log contract so uh do you

remember what the the price was around 57 000 or 54 it was like it was either 57 or 59 000 and one i remember yeah one and we're like this is too like it looks fake because we have around numbers yeah it's like it's like hats off to nadav he's a freaking whiz kid on this stuff and like a lot of the really important stuff he's been doing lately was like made this possible where you know nice thing that is like these oracles don't have to coordinate or even know each other exist at all all me and the dav do is just need to get their signatures like individually from me from them so like i think like the bitfnex price signed like one dollar different than the than pierce price and your your price you signed was like a couple hundred dollars different or

something or yeah i think a couple dollars at least i thought it was like ten dollars different but uh yeah yeah so we had like three different prices and our contract was still able to execute because like there's a lot of this fancy logic and compression stuff he's doing where you know if we made a contract for every single possible thing that all three oracles could sign, there'd be like 10 quadrillion different outcomes. And, you know, it's signing 10 quadrillion. We need big blocks for that. Yeah.

I'm just kidding. You'd have to take it like, you know, days to sign. But during like all the fancy stuff we do in the back end, it turned to like 5,000 outcomes. And, you know, it's a lot more easy to do. And it's really freaking cool what we've, the stuff he designed. and when you guys created that that contract you set minimums and maximums of like a standard deviation between the prices or something like that yeah there's like a so there's like two

things you set there's like a min fail and like a max fail so you say like you know we want to cover all cases within like 128 dollars say and then you know up to 500 will allow some variance but you know it could fail if there's like a 300 difference but you know it might work if it's $300 one which is kind of how the math works out in the back ends yeah so like a drastic example of this would be um you know i say the bitcoin price is 150 000 uh bitfinex says it's 50 000 and then pierre said it was zero dollars the dlc in that case would not be able to settle and everybody would be refunded their initial collateral because it's outside of those um accepted error bounds that was configured between the two contract participants so

I mean the key thing to remember with DLCs is like in the failure scenario where the oracle disappears you know you can always get your money back just by executing the refund clause that's obviously not ideal depending on you know if you're winning or losing in the DLC but it is a way to you know minimize like really bad outcomes like funds just being frozen forever yeah something cool that's going on too is like you know say like we have these three different prices how do we pick which outcome to sign like you know if they're a hundred dollar difference i might change between a couple stats between what we receive and basically how it works is like we just like rank our oracles however we see fit so i think we chose like kraken is number one

but phoenix is number two and then you is number three and um and so like so the kraken price was like you know our stable price and then we just made sure the other two were in the range and then we executed based off you know the practice prices of this then we you get this amount of satoshis yeah it's it's fascinating it's it's crazy how intricate it's all getting because the last time we talked we talked about like contract for difference yeah i mean we've really been yeah i guess we've been doing some work i mean you know in the day day in and day out it's always hard to not get uh you know that disillusionment it's like are we even making progress it seems like things are going so slow but this would even you go and talk about it on

a podcast like oh yeah we did that we did this and then uh you know again going back to the tooling stuff i was kind of shilling for at the beginning is uh all this stuff is still very technical and only usable for engineers and uh as the dlc protocol solidifies and stabilizes you know we're going to be working on tooling for end users um so for instance in this example of picking multiple oracles that we were just talking about we would like to do some sort of a checkout experience on our oracle explorer so you can be like ah click i want the bitfinex oracle and i like them the most and then i want pierre richard because his tweets are funny and i want him to be my second oracle and uh maybe i don't really like chris so much because his custody stuff is weird

but i'll throw him in there as the last one and uh you know have you know you you pick those oracles and then, you know, pull it down to your local wallet and build all the transactions and off you go with your DLC for whatever you want to bet for. So like figuring out what stuff makes sense to build things like web tooling for and then thinking about how to integrate that

with like, you know, your self-custody wallet that, you know, you have on your local machine or phone or whatever is something we're looking forward to in the second half of 2021 here. And I think you put it that way. it's like crazy to think of what these wallets will turn into i mean like while it's there like you know some of our podcast apps now seriously like what the hell if you told me that a year

ago like why would they do that now it's like oh this is so cool i'm using this right so like can we even call them wallets are they like platforms yeah are they what are they i mean like if you said like you know like when the internet started i was like you know this is for sending research papers around if you told people like yeah people are gonna like use vr porn on this thing or or play like video games like shooting each other across the planet like what no we share research papers on this thing why would they use it for that now foundation for a new monetary system is going to be built on this no so like i think like bitcoin's gonna have a lot of that or like you know a lot of that stuff what sounded crazy a

couple years ago but it's just like obvious now or just it just makes sense i guess like harping back to sphinx conversation with paul toy like are we building a new internet on this I think obviously not like the tcpi but like I don't know I think well it's like not building a new internet but re-architecting the internet in a way with this new layer I always think of it as like you know the history doesn't repeat itself but it rhymes and like I think that's probably the perfect saying for what's going to happen with bitcoin and its integration into the wider internet maybe is the way to put it and you know we're going to get all sorts of cool stuff that uh we can't even imagine now and it's going to be awesome and

you know i i always just think it's like even just basic financial products is like can i get like a loan for a day or something like that or just like i you know i don't even know it's it's just hard to really fathom about the what the possibilities are but it's programmable money so really anything you can program into it i guess is uh what's possible you need you need defy for that though yeah bitcoin defy with dlcs this is another debate we always have should we call it bitcoin defy or not and uh where do you fall in the debate i don't think we should because defy has kind of become like a no-no word and you know associated with rug pulls and uh scams and all this but it does encapsulate you know kind of what we're doing a lot yes that's that's why i'm for the

record i'm on the offices that have been here and i think you just got to go with the flow at some point and uh it seems to be what people know so what uh ryan gentry told us is just get a bunch of d gens using it and they'll come up with a meme and that's what you call it right exactly that's a good idea well peter an american huddle right well let's let's use this opportunity to basically just draw a line of distinction between the defy that's hot right now ethereum finance chain all that all that jazz and what you envision it would be in a world built on dlcs on bitcoin well i mean i think just for for starters there's no like tokenomics or i don't even know if that's the term they use anymore but it's just like it is finance there's just no token stuff added on

to it like bitcoin's the token like i think the fundamental like most important difference is like you're doing the self-verification of the actual contract versus like having you know the ethereum blockchain do this yeah so like you know when you see like this you know sushi token contract on thing you can read the code of it and find you know how to exploit it and then just take all the money whereas with this like all my contract logic is off-chain in my wallet that i'm not going to reveal to you so you can't know how to break it even if there was a bug in it so like you can't tell that people are even using these things and like you know you can't like if you find one critical bug you're not going to just collapse and just take everyone's money immediately like

the worst case scenario is either you cause the wrong outcome to be executed or you cause people to refund let's dive into that so you're holding on the logic in your wallet and instead of on chain that's much more secure yeah so like how like an ethereum contract works is you like you write this fancy solidity contract and you publish it on chain and now people can deposit and like execute functions on that whereas with this is like say me and you are doing a bet we just sign a bunch of possible transactions that could happen encrypt them with um you know what we would see the oracle's key would be once they sign it then we can decrypt that and only broadcast a transaction that's the correct outcome so like our entire contract's logic is off-chain just you know which

which transaction can we decrypt to make valid so you know we're not no one else can do that unless they, like, break into our computers and find those encrypted transactions. That seems much safer. Well, I mean, to give the devil his due, though, you know, the reason DeFi on Ethereum is so popular is because it's all on-chain. You know, these automated market makers,

the market itself exists on the Ethereum blockchain so that anybody can send orders or try and execute trades directly on this Ethereum blockchain. and you know for all of us bitcoiners we're out there thinking well this doesn't scale and it's horrible for a bunch of reasons which is true um but from a market uh kind of infrastructure perspective it's very attractive because you know everybody has the ethereum blockchain you know don't go too far on like you know running full nodes and stuff like that but everybody has a view of the ethereum blockchain and can execute orders against this like the way for this us to

do this on bitcoin has got to be some sort of lightning solution where you know we have these routed channels or it has to be a centralized platform that's doing the matchmaking as far as i can see so again the key thing with the ethereum defi stuff is the matchmaking is happening on chain and it's also harder to regulate them too so you know there there is um not from technological perspectives but a convenience from being a market participant of having the market live on the blockchain um it makes like ux a lot easier too because like they just have metamask call these couple functions and you know create order cancel order whatever versus like us you know you you need to have your like self-hosted wallet or whatever manually verifying all these transactions

so you know that's a lot more i mean the bigger thing though is just finding somebody to trade with that too yeah it's like well i want to go sell you know a call option or something like that it's like well where do i go find that person to take the other side of the trade with ethereum you just look on the blockchain and see what the market is uh with dlcs you know you need to have some sort of coordination going on because you need a liquid market to be able to find participants to trade against and we can't do that on the bitcoin blockchain so that means there's got to be some sort of uh you know hosted solution somewhere whether it's on like tor website or you know i don't know where uh to facilitate the actual market function itself

And that's really the value of Ethereum DeFi is the fact that they're, you know, really abusing the Ethereum blockchain to allow for all these trades to happen on it. So it's a trade-off, I guess. And it's important to give the devil his due because we can learn stuff and figure out, you know, what works, what won't work, and, you know, what wisdom we can glean from what they've done over there. Yeah, but, I mean, it's a totally solvable problem. like you know we have like decentralized exchanges already on bitcoin whether it be like bisque or even like the joint market order book you know that's all essentially decentralized and uh you know we don't need to you know put all of our data onto blockchain we can figure out ways to do it off the chain and you know make it more private more scalable and that's like something we would

love to do with dlcs is just integrate into existing places that liquidity exists say like with privacy people like people are looking for to get privacy it's like sometimes there's some synergies between the crowd that wants to speculate and uh people that want to gain privacy and you know maybe we can uh work together on that front so i'll boot for thought i guess flesh that out a little bit what do you mean well i mean so if uh people that want privacy maybe they're willing to take some sort of conservative bet if it means that they get to mix their coins or maybe we get a huge group dlc going or something like that to allow the transfer of funds and start like you of obfuscating the transaction graph that way or at the very least like we could just be like you

know dlcs could just be you know part of this bitcoin join round and since we're gonna do a transaction anyways just have like you know we're just adding in an admini to people and saving on fees so what would the dlc be like what would what i mean it could be anything you'd be betting on the price betting on super bowl betting on um you know election it's just like you know instead of like opening our funding transaction just between like just having our own inputs and outputs we just put inside of a coin join so now our our dlc will execute after the coin join but we can um you know we have you know we're just like adding to this anonymity set of everyone opening and closing at the same time okay i guess where i'm confused is somebody just trying to attain

privacy leveraging a dlc are they making a bet i guess like to be clear there um they would need to be seeking out like liquidity or whatever privacy functions that they want to obtain and like maybe dlcs can be part of that way to get enough people to want to mix and then do dlcs along with this and um you know so they'd just be another input yeah so like separate of the dlc that's executed like wasabi is getting like you know like 30 participants an hour if you know added like dlcs and say like lightning as well maybe they could get 50 participants an hour now everyone's benefiting from that because they have you know more anonymity per mix yeah i mean that's something i'm kind of hopeful for is eventually we can get some sort of uh you

know working together with other teams to again get enough liquidity to allow for you know liquid markets with dlcs and hopefully liquid markets when it comes to obtaining like privacy too or enough um i admittedly am not up to date as much on privacy stuff but uh i can't imagine that more liquidity and the the privacy protocols is going to be a bad thing for them am i am i off there ben no not at all i mean privacy is like best when you're in the bigger crowd so the more people you get on in on it the better yeah so um but they do have to be willing to uh you know if they are going to be in a dlc they have to be willing to be speculating on something or putting funds at stake for something i'm more so saying like you could just like mix regular users that

are just like mixing their own coins with also people who are executing dlcs so like you know they're both benefiting from each other without actually like cooperating as much yeah it's so fascinating yeah again like the thing though is liquid markets we want those for dlcs we want to standardize some contracts that seem to be popular so that we we can get the liquidity that we need for making dlcs popular is something at least that i i hope we can get to and achieve uh over the next like year year and a half but all this stuff is hard and takes time i guess and resources so well you mentioned lightning as a potential source of liquidity provider a matchmaker uh i think uh i was more so saying on the coin join side you just have like you know

people instead of like opening a lightning channel in a single transaction i can open you know i'm going back i'm going back further like in the context of defi comparing it to ethereum defi oh yeah so um yeah i mean it's it's just basically you know that all the benefits of lightning kind of apply with dlcs too and then with having you know what ethereum defi does is have uh all the market coordination happening on chain with lightning hopefully we can have some of that use lightning's toolkit to facilitate some of that coordination over the lightning network to be able to do dlcs either having them directly in your channels or you know broadcasting oracle secrets or whatever you want like a sphinx tribe as an order book yeah something like that i guess

that'd be interesting yeah right yeah it'll be fascinating to see how this all evolves yeah i mean uh it's well i'm thinking about like lightning pool is that like a proof of concept or something that could be applied to dlcs and what you're looking for i'm honestly not as familiar with lightning pool uh i've i haven't read up on it enough to fully understand how it works on a technical level so i've been have you i mean i understand how it works but i don't i don't know i think it's kind of like a separate completely separate entity like that's more like you know paying for inbound liquidity versus like this is like no one to bet on this third party nothing related to bitcoin thing yeah all right all right hey hard problems to solve yeah i mean again it's

uh the hard thing with bitcoin is none of this coordination happens on chain it's all off chain which means that the participants for things need to have a way to communicate with each other to set up these uh dlcs uh lightning uh channels um all sorts of different things so that's uh really the kind of fundamental difference in architectures between the two chains and i you know firmly believe the choices that bitcoin has made will scale into the future decades from now uh but it's it's harder now i guess in the in the moment so that's a trade-off yeah i mean like we know there's solutions it's really just like picking the right one and like even if we pick the wrong one we can just build the other one because we're doing this in like modular and

layers so like you know if we screw up trying to do like a sphinx chat tribe order book then we know okay we can go to the bisque model or we can go to the this model and you know it's all doable and it's not like if we screw it up it's not like bitcoin screwed over we just try again yeah that's what something that sphinx chat really drives home is like the combination of the distributed bitcoin and lightning networks and rss right as a content distribution model just combining two distributed things and getting useful and that almost seems more robust too right like less more anti-fragile i think like the beauty of it is like it's really just like you know lightning requires that i have you know a home at a server at home so it's just like

leveraging that so now instead of like having to store my data on twitter.com or whatever and have them you know do whatever they want now it's just you know i have my own server and i can leverage that and now you know now we can encrypt it all and we can you know have itself uh you know self-custodial i guess yeah self-custodial i like this quickly it quickly he gave me the eyes they're like yeah okay chris i'll say self-custodial crazy man self-custodial it's not non-custodial nuance here freaks nuance trying to get brownie points with my boss well i've been yelled at by ben many times for for writing in the newsletter that the dlcs you're working on are applicable to lightning network and he's like no it's not ready for lightning yet i

think he's done it twice at least now yeah we need uh we need ptlcs most likely much either i mean they need schnor um no like with this whole ecdsa adapter six yeah we can do it without schnor but like it's more expensive right well it's just also resource investment too it's like uh are we gonna invest down this path that we know is going to you know be going away in the next year and like you know kind of contradicting myself of what i was saying earlier it's like since we aren't there with the lightning stuff yet um maybe it does make and it's not pressing to get it done you know in the next three or four months it may be as wise to wait until the ptlcs are supported officially in the lightning network before we start trying to do dlc stuff in there rather than

rolling our own code and kind of going against the grain with the rest of the network i guess yeah like we could do it today but like we'd have to redo it all like after tap roots activation so there's like there's no let's just wait for now and while it seems like it's gonna happen yeah you guys got other stuff to work on anyway yeah like us have tons of stuff to work on lightning has tons of stuff to work on like you know we're we're plenty bogged down yeah yeah my son has joined us in the room i'm sorry uh wait so uh marty uh and my wife what's the deal with the the cow oh yes we have to get on this so i was thinking about this so my family bought a cow we had a family friend buy a farm uh a ranch and they they basically adopted the cattle

on the ranch and the rancher staying to to raise the cattle and um yeah so they said hey do you guys want to buy a cow and i said yeah i do want to buy a cow that's awesome and so uh my parents and i are splitting it it is four months old okay 350 pounds and you were talking about like a dlc on on the cow's weight when we slaughter it um and my son's actually going to slaughter we're going to teach him hard lessons early boy i mean i grew up on a farm there's a lot of hard lessons you learn on a farm from a very early you learn the circle of life pretty early yeah using a lion king quote the uh the the only like who's the oracle like can you i mean are you are you unless you're speculating on two then you do have a conflict of interest yeah right and you can use

crystal bowl the uh tool that ben has made to do it you know it's almost a little bit of a irony there that the tool is called crystal yeah yeah it's just like a simple app to be an oracle so i mean maybe you get your your family friend to be an oracle right well maybe the freaks will just have to bet on the weight of the cattle when we saw well i mean this is again what happens in derivatives markets like actually all the time it's like you know people need to figure out like how much beef is coming out do i need to buy some futures contracts to sell or buy these things um you know it is how you know commodities markets work frankly so yeah no right like and like i can't like what do what do what do you slaughter cows at usually like a ton

they weigh a ton um yeah probably for beef cattle right around there i mean i think it's probably like 18 to 24 months maybe maybe up to 36 that's a little old though for you know yeah i think it's like 350 pounds of four months it's yeah it'll get it'll get up to a ton what angus yes yeah black angus looked very healthy you did that's cute i hope well i guess we can touch on this now like you um had untapped growth on on the podcast talking about regenerative cattle ranching a couple weeks ago very hot podcast very i'm very enthralled by the idea and excited about it you being a being a farmer the milk cow farmer particularly dairy cows dairy cattles correct correct vernacular there uh you had uh some pushback well i mean first i want to apologize

to untap because i came out i'm a little hot on twitter like that was that was my bad and i don't have any problems with what he's doing it looks great um my bigger concern is just people like to demonize big agriculture like they demonize big energy that uh you know they don't provide any service and are somehow destroying the planet which is like just totally incorrect in both cases somebody's been getting closer to big energy like i think they can agree with that yeah i mean it's just they are providing services to people and if you get rid of these people you know your energy prices are going to double triple quadruple i mean who knows same thing with agriculture if you get rid of the big agriculture producers i mean do you want your food prices to double triple quadruple

i mean that's that's the trade-off here and like economies of scale or what yeah economies of scale uh also well of course it matters how long you phase them out over say if you do it over 100 years maybe there's less of an impact than if you you know get rid of them tomorrow of course But, I mean, the 20th century told us a lot about, you know, tinkering with agriculture and what dangers it can have. And it seems like nobody, everybody's forgot those lessons, it seems like to me, where, you know, you start messing with the farmers and you forget that you can get the famine that comes with that.

So that's more of my overall point for people that criticize agriculture. I'm not going to speak for Untappd because I don't think I can do so articulately or accurately but i think the one thing i gleaned from that conversation is like what is big agriculture's effect on the top swill which is like yeah right like but you came into that thread and you said like my family farm like we yeah yeah so yeah like speaking to that a little bit is um you know of course this is contextual to this is you know i was born in the 90s so i'm speaking from the 1990s forward whereas something you know some of the research was from before the 1990s a son we're recording but um so like with our family farm we do things like you know

contouring we do no-till uh you know just all these like basic tactics to make sure you aren't losing your topsoil because you know most farmers they care about the land that they own because they plan on passing that down to their next generation and next generation they don't want to leave the land barren so that it can't do anything so uh like i think it's just a little short-sighted to think that uh you know that farmers don't care about their topsoil it also directly impacts the yield uh and that you know corresponds to money in their wallet i guess i shouldn't i should say maybe not this year but over the long term if you are farming the land for multiple years uh you know you can't just extract resources and put nothing back in you're

going to get nothing eventually, which is just kind of really against the, you know, farmers that I know, anyway, is, you know, they really care about generational exchanging of this land. And you got to be thinking for the long term in that case. And maybe the science wasn't as great back in the 60s and 70s when it came to soil management. But farmers are changing and, you know, becoming more modern with the, you know, the science that's out there for how to best manage this stuff so um yeah i guess that's that's my little spiel on that or rant on that i don't know if that makes sense i appreciate your perspective on this because we talked about it the first time you're on um your your family dairy farm it's uh yeah it's fascinating stuff big problems

big solutions we're working on it we're down here in austin we're all moving here hell yeah we are are you ready for us i don't know if the unchained office is but the city is uh like is this gonna be the new bitcoin mecca do you think it kind of already is like new york was the uh the pinnacle you had like you know half the fucking core dev team there and uh you know a lot of really smart minds and now new york has gone to shit and um it seems like everyone's just like screwed i'm going here or to miami and it seems like a lot more here yeah i mean there's a lot of new yorkers coming down for big devs tomorrow we've had a bunch of new yorkers who just like they just fly in every week

or every month and it's like hi you know i'm bob and i'm from new york it's like i just flew in for the meetup it's like what the hell there's tons of people doing that and also like every meetup we have like at least two or three people like you know hi i'm bob i just moved here it's like oh wow we're getting so many people what what is that gonna do for the city of austin i mean you got tesla here they're they're bitcoin forward you've got unchained capital here gonna be a stalwart i mean chip factories getting started up around here i mean it really is amazing when short bits get in an office down here that's what i want to know i mean when short bits get in an office we're all uh working remotely right now and that's worked out well in covid but as we

grow i think it probably is inevitable i don't know if we could it's an interesting question if you can be a fully remote team and be a really big team or if you need hubs. I don't know if you actually need like a single corporate office, but I maybe think you possibly need hubs of like an Austin hub

or a New York hub or, you know, whatever. Yeah. I don't know. Yeah, we're still completely distributed at Great America Mining and we're like completely spread out. We've got two in Boston,

currently in Austin, but typically in New Jersey, potentially in Austin at some point by the end of the summer. Come August, you'll be here. Potentially. We've got somebody in the Army, Austin, Louisiana. Engineer in New Hampshire, one in Utah, one in North Dakota.

I like to hear those teams that are just everywhere. I guess touching all the places in the United States is always great to hear instead of just everybody lives in San Francisco or everybody lives in New York. Yeah, I mean, for our line of business, we need the oil men lived in, live in like North Dakota. I mean, obviously, there's a lot of oil men here in Texas, but we've got the Bakken oil men on our team in North Dakota. So that's interesting times. We're going to. All right, we'll create the cattle DLC.

I'll be the Oracle. I guess you freaks got a bet on. I got to teach you how to use crystal ball, then I can figure it out. I'm sure it's pretty easy. I'm okay in the command line. There's no command line. No? It's pretty gooey.

No, we're becoming more modern. Even better. No, I should be able to figure it out. Yeah. I'll set it up. Any freaks out there want to bet on the size of my cow, I'll be the oracle. I guess I got to stay out of this. You got to trust Marty.

He's unbiased. Yeah. You also need to make sure what weight are you talking about is lean, actual muscle that you can eat, or are you just talking about body weight that you put them on the scale before you actually slaughter them? It's like, we need to hammer out those details. I think body weight scale. That's probably the best way to do it.

Before my son slaughters him. He's gonna, yeah. I wasn't slaughtering cows at that age, but he'll be like three when it happens. He should be shooting cows by then. Safe. I'm kidding, freaks. I'm kidding, freaks.

I'm not gonna force my my three-year-old child to slaughter a cow um gentlemen thank you for doing this on such short notice anytime man i mean we had we we all were coordinating separately in the weeks leading up to this but then today i was like let's do it today you drove down you flew in yeah here we are at the right time yeah feels good well i hope you enjoy the rest of your vacation with your girlfriend yeah well i gotta work on the vacation with the girlfriend part and not just hanging out with friends and talking bitcoin she doesn't find that as fun as you can imagine you're bringing her to bit devs tomorrow no i'm not gonna subject her to that torture for what about barbecue after i

was thinking about getting her to come to that but i mean we go to bed so early we're old people and like you know that i mean what time is bit devs gonna be over like 7 30 it starts at seven i'm not gonna be able to stay up jesus you old man seriously i'm on that i'm on that 60 year old life track not a 30 year old i got my brother rolling into town and dragging with me yeah throw him in throw him into the does he know anything about bitcoin or is he fresh he's you know i mean we talk about it obviously uh a lot he's knows enough to be dangerous um he's never gone to like any bitcoin events or anything like that i think like just going to one of these events it's always like you're just like oh you realize this is so much deeper than i thought

like oh they're arguing over like you know you know should this bit be zero or one what the hell and uh yeah okay this thing is a lot more serious than i thought it is and i think that's good exposure for people yeah i'm excited to get them get them into the fray i mean for people it's like yeah like i went to new york bit devs and i was like oh my god these are my people like this is what i want to be talking about and you know even if you don't understand all the technical stuff the people you meet it's just great i remember your first new york bit yeah like probably early 2018 maybe late 2017 yeah we had a beer at uh the westville after you were wearing a beanie that sounds right yeah you were wearing a beanie and sweatshirt there's my photogenic memory coming

in i was super privileged my first one was the 100th new york bit like i i like i sat down and peter wallace the next to me i was like oh my gosh this is a god himself yeah that was a ton of fun my first new york bit devs was right after the quote-unquote hong kong agreement rostianovsky was explaining segwit for the first time i have uh notes in one of my journals back home oh that's cool yeah uh yeah you know you've uh you've inspired some zoomers to take a journal too i know uh jackie he takes like a daily journal now it's talking about bitcoin really you know it is cool i haven't read well the bend is somewhat of a journal but um the ones i used to write back in there more personal i need to get back on i haven't read

my journal in like four months it's uh but i do highly recommend it is a cool like little like going back like 2014 2015 when i was writing like in like every third post that had the price of bitcoin i was like holy shit what would you uh in you know now that you're here in 2021 what would you have to say about uh 2014 and 2015 marty is like wow he was insightful or stupid or like he should have been stacking more sad he should have had he should have been he should have took a second job buy more yeah sell your blood for plasma that was uh it was a i'm very happy with my my journey through my 20s but i was unemployed for a good while and i did quit very uh good paying jobs for very bad paying jobs um

but i want to take anything back you're doing well now it seems yeah down here hanging with you too so talking to losers like us really are off the path yeah jesus all right gentlemen well this has been a fascinating conversation as always thank you for the work you're doing i'm very excited about dlcs again And I say it often, I think people are sleeping on DLCs. I think they're going to be huge in the work that you guys are putting in the base level work.

That's going to be integral for this technology succeeding decades from now. And does not go underappreciated here at TFTC. So I want to thank you guys. Yeah, no problem. Hopefully we got more customer facing stuff coming in the second half of 2021. So that was a,

that was a look. You just got bent. There's a lot of work for me in there too. so that's a lot of what i've been doing this week because uh hodl thrusted it upon us but yeah it's coming i made some pretty stuff today i think yeah i like pretty stuff all right gentlemen i'll um i'm gonna kick you the hell out of my airbnb and i'll see you at bit test tomorrow all right peace love freaks