TFTC: A Bitcoin Podcast - #374: Bitkit, Hypercore, and RBF with John Carvalho

Episode Date: November 10, 2022

Join Marty as he sits down with John Carvalho, CEO of Synonym to discuss Bitkit, Hypercore, and Slashtags, before later diving into into the RBF controversy. Follow John on Twitter Check out Synonym And Bitkit Shoutout to our sponsors: Unchained Capital Braiins HodlHodl Upstream Data TFTC Merch is Available: Shop Now Join the TFTC Movement: Main YT Channel Clips YT Channel Website Twitter Instagram Follow Marty Bent: Twitter Newsletter Podcast

What's up freaks, it's your boy Marty here to introduce this rip of TFTC, getting a late one out this week, been a busy week, beginning of the week for me, but sat down with John Carballo, been in this space for a while, building Synonym, launching BitKit this week, here to talk shit about the chaos in the markets, not only chaos in the markets, the bait going on, between some service providers in the bitcoin ecosystem and bitcoin core over a new replaced by fee standard that is set to be implemented in version 0.24.0 of bitcoin core but controversial we talk all about it i think you guys are going to like it was brought to you by good friends at unchained capital man is unchained capital looking good this week not your keys not your coins unchained has built their business around the core tenant of allowing their users to hold their own keys and interact with their platform their value prop is being acutely highlighted right now as we have centralized exchanges going down obviously ftx

went under if you're not paying attention rumors of others that may be in trouble may only be rumors but the point stands if you're holding your bitcoin on an exchange it is a single point of failure a lot of ftx users found that out this week billions of dollars evaporated overnight people not able to access their bitcoin or their shit coins and have simply woken up and they don't that money's poof gone that's why unshade capital exists again they build all their products off the basis of multi-sig custody that gives their users control of their bitcoin but also enables them to collaborate with unchained to do cool things with their bitcoin mainly hold their bitcoin that's their vault product which is two or three multi-sig escrow not an

escrow account two or three multi-sig cold storage wallet where the user holds two keys unchained holds one since you hold two in the two or three multi-sig quorum you can always move your bitcoin out but if you're ever in a pinch you only have one key unchained is there to be the second in the two or three multi-sig signature multi-sig quorum excuse me uh beyond that they have their lending desk which allows you to put your bitcoin up as collateral to get cash spend as you see fit in that model as well you hold one key uh you put your bitcoin in the escrow account you hold one key unchained holds one key and another third party holds the third key yes you can't move your bitcoin out of this but you have visibility you know that unchained

isn't re-hypothecating your bitcoin because you have that key you can see into the wallet you know it doesn't move it's not like ftx where you put your money in and then they go uh lever it up and give it to their trading desk to go to go set on fire not possible in this setup eliminate single points of failure in your custody model in your lending products if you're going out there and using bitcoin as collateral this is the best way to do it people have not figured it out unchained has figured it out they also have a trading desk where you buy bitcoin goes straight to your multi-sig cold storage most secure way to buy bitcoin it doesn't stay on the exchange so that they can then go speculate with it then you wake up one day it's not there

can't happen with unchained go to unchained.com check out all these products really highlighting the value prop this week ftx thank you from the unchained team this rip is also brought to you by good friends at brains brains brains brains brains this is the bitcoin mining handbook explore the fundamentals of bitcoin mining uh author daniel frumpkin forward marty bent that's me wrote the forward to this book by brains because i feel very passionate about this company i've been the company behind brains pool formerly slush pool which is the oldest mining pool in bitcoin's existence they have brains os plus firmware which allows miners to stack more sats with their hash

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you can use if you're an oil and gas company your excess natural gas to my bitcoin go to upstreamdata.ca tell them the tftc sent you and enjoy this rip with john carvalho You've had a dynamic where money's become freer than free. When you talk about a Fed just gone nuts, all the central banks going nuts. So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor. I mean, that's part of the bull case for Bitcoin.

If you're not paying attention, you probably should be. What the fuck is going on? Do you think it's a state attack? What? FTX. Oh, I don't care, honestly. I mean, people are going to pick the narrative that suits them best, and we're never going to find out the real truth anyway,

so pick what suits you. Yeah. Logan, did you ninja launch on us? Yeah, he did. We're recording. What narrative suits you in this whole scenario? Shitcoin's going to shitcoin, and shitcoin's going to blow up, and I'm glad that I like it better when they blow up than when they sustain.

So that's how I look at it. Sam Bankman Freed, I first heard of him, and I'm pretty sure when he came on the scene and what kind of made him famous was when he was kind of taking over DeFi, when DeFi was kind of dying early on and he kind of like I don't know it wasn't it wasn't like he like copied over a sushi swap and saved it when it was going to die and then he like kind of turned into like a huge you know DeFi proponent and kind of turned that whole Ponzi racket into a thing and then he kind of used that as a foundation to keep you know the momentum he got to to where he was eventually putting his logo on stadiums and scamming tom brady tom brady larry david

a bunch of retail investors that one was a big disappointment for me man because i only like i just like only discovered tom brady i mean uh larry david like maybe a year ago less than a year ago and i started binge watching like everything because i started watching the new season i was like this is fucking awesome and i went back and like watched all of them of course the newer ones were a little more of my flavor because the old ones are now kind of out of date like you know they're so old now but um I really liked all that and discovering I was like Larry David is my soul my soul animal you know and uh to see him on that commercial at least he was saying things that was like skeptical the whole time and now it actually looks like he was

correct they were trying to make it ironic but yeah it's what a weird surreal thing to see all that happen and I don't know now there's like tetherfud around this and it's just everybody's trying to like capitalize on it but i'm happy to see bitcoin go down to 15k to see some draining over the swamp um i think i'd like to see even more to be honest um i just think ethereum is too high shit coins are still too high people have still too much hope in shit coins i liked it better when they would die 98 every bull market you know i do as well and you've been around for many years yeah so what how would you quantify the events of this week compared to events of of the last decade that have been considered big events mount gox uh the fork

well i made a tweet uh earlier i think today saying um no yesterday saying that this is definitely my favorite bear market because for a couple reasons i didn't elaborate in the tweet but one obviously it's very entertaining to watch these big things blow up and you not be inside of them um and and so but that that kind of moves into the other reason why this is my favorite and that this is the first time that i have like uh fully been comfortable with my strategy and behaved myself in other words just done nothing um and you know in the past you know you would like you would want to trade like in my early years in bitcoin i was trading a lot and that's kind of how i the communities i was in in the beginning and you know learning all of the ups

and downs and do's and don'ts and stresses and things related to that worrying about custody when when sometimes you know exchange would be down for a while and you weren't sure what was going on like all that bullshit like you know people say oh you're in bitcoin 10 years you must be bloody rich and it's like no man like what happens is the first time you make some money you like pay off your car loan you don't like say i'm gonna hodl forever you know you just you just your wife or ex-wife you know is like all right well let's let's take care of some bills you know and and you can't really argue with that it makes a lot of sense and so but after all the bullshit you know you end up finally just kind of realizing just do nothing man just like if you think the

bitcoin price is high you know give your family a good christmas you know like don't go you know don't sell all your bitcoin um if you think the bitcoin price is low then maybe you know annoy your boss to pay you faster like just like you don't have to trade you definitely shouldn't be leveraging um and because i'm not doing any of those things i can just be you know at peace focusing on work and getting joy out of my work and i think that's the strategy and i've been preaching the strategy for a while but i've only only been able to fully implement it recently you know yes i do know so i find myself in a in a similar state of mind where it's watching all this shit blow up i mean it does suck to see people get wiped out but there is a

a layer of schadenfreude that's that slips in and it's like it that's the thing with this whole fdx situation i mean it's been building it's i think many would argue part of the contagion event that started in the spring of this year with terra luna celsius um 3ac the mining space just that wave is continuing but bringing back to fdx and spf specifically i mean you mentioned him cornering defy markets that was like after like ftx like rose out of nowhere like the whole way in which ftx came to be like a dominant player in the space to the point where they could name the miami heat arena have all this uh marketing at the super bowl i think they named another stadium in arizona college stadium and then the way sbf was vaunted as this whiz kid

figurehead in the quote-unquote space where he's and it's funny how it always happens right you had like justin's son last time and there's always some kind of like idol that emerges and he's like the wonder kind and he's got the you know he's got the angle he's he sees the matrix you know and then everybody gets right yeah no it's i mean this time around too now that we're almost 15 years into bitcoin's existence the people that are getting wrecked by ftx specifically like you mentioned tom brady but you have big funds like sequoia and other prominent incumbent venture capitalist funds that like to tout themselves as the creme de la creme that are that are going to do the best due diligence,

certainly going to back the best founders. And then you see this blow up and then a bunch of people are doing a retrospective on these incumbent VCs and their thesis for investing FTX and the due diligence that went into it. And it just highlights again how early we are and how much people misunderstand about Bitcoin

and why shitcoins are noise and Bitcoin is a signal. yeah the the strategy you know i didn't specify it entirely but the strategy is pretty simple guys like um earn more than you spend take what you don't spend and buy bitcoin with it and you know just huddle as long as you can until that bitcoin turns into something that you need to be able to use it for for your family or your you know your designs for your life and that's it yeah it's pretty simple and you're building tools to make that easy what should we talk about first i mean we decided to record this last week before all this happened and the initial intention was to talk about the replaced by fee updates there seem to be getting push into bitcoin core

and what that means for some services in the space and for mempools more generally and then what you guys just launched at cinnamon there's not cinnamon synonym with uh with bickett many times i'm just going to change the name at this point does that happen does that happen i'm sorry i'm actually i've got i've got two sick kids under three i've i'm going on two hours sleep so um excuse my mispronunciations if they do i i do it it's normal yeah um i actually got to test out uh the big hit last week and uh had an insider in austin who had access to the wallet and i was able to send and receive from the wallet it was pretty uh pretty robust inside of my cousin yes yes it is shane's awesome i don't want to dox him i don't know if like

you want to let people know his test on that he's the only one in austin that has that so it's pretty easy uh but yeah um so i guess let's talk about bitkit um you know uh the The conversation about, you know, the price and FTX is a little somber. And so, but maybe it's make it something a little more positive and exciting. So, yeah, one of the things that we kind of announced during the Plan B conference in Lugano was our new wallet, BitKit. And it's meant to be, you know, as it says in the slogan, your ultimate Bitcoin toolkit. It supports Bitcoin, Lightning, and it has an implementation of slash tags in the wallet, which is our own protocol. for doing kind of the web three kind of thing but without a blockchain everything in it is

self-custodial so you're you're holding the keys for your own bitcoin on chain you're holding the keys and you have an ldk node for your lightning node um ldk is you know this is the first i think public at least um launch of ldk in a in a mobile app i i do need to make a note that blue wallet did implement it before we did, but they still are having it behind a kind of developer mode that you have to unlock to be able to play with it. Granted, you know, we did realize and learn that LDK had some things that had to work out to be ready for production as well, but they've been really helpful in working with us on trying to iron out the remaining bugs so we can fully unlock lightning features in the app. But as I was saying, you know, it's got Bitcoin, it's got a lightning

node in there and it has a bunch of cool features that kind of allow us to show a whole new user experience um for a bitcoin app or for a bitcoin wallet and that includes the stuff with slash tags so i don't know how long you want me to rant about features or if you want to have ask some questions first but that's the general review is i just wanted to make the best bitcoin wallet and show people that if you rethink things and start you know start from from scratch that you could actually make a really nice looking wallet with really easy to use user experience and you can kind of iron out a lot of the complexities of things like having lightning um just by you know having being very thoughtful and having a good you know design team and good approach

yeah well i think it's been a little over a year since you were last on the show when you were in austin recorded in person and synonym was just getting announced and you were i said it right i just had to think like i said i said it right it was just getting announced we're explaining this vision for slash tags building on hole punch uh last month we had paulo arduino on from bitfinex and tether uh talking obviously about tether and uh bitfinex but also hole punch and building keit.io and hole punch so it seems that a lot of development has happen with hole punch specifically uh over the last year since we last talked maybe maybe we start there with the developments at that layer maybe give a refresher of what that is and how

you guys are using it to implement slash tags sure so just it gets confusing just to talk about this tech in the first place so please listeners bear with me um a lot of these concepts are new But also I want to clarify some things terminology wise, because it's still not, you know, we're not all on the same page as a family of companies yet on what we call the different tech underneath what we're using. Because basically, Whole Punch is a company, but Whole Punch is also making a platform called Whole Punch. But Whole Punch platform is not public or released yet. And we haven't actually used it either. but what hole punch is a platform for is building apps with hyper core and so the underlying kind of lowest lowest level of tech that we're all using for slash tags hole punch key etc is hyper

core and that's been under development by the same mostly by the same people at the hole punch company um for years and a few years even before synonym existed they they've been working with Apollo and doing various research for different technologies to kind of, you know, improve that platform or that technology and add, you know, all the features and kind of battle test it, et cetera. And that has resulted in kind of these two, I guess you could call them layers on top of HyperCore, one being the whole punch platform, which will be a way to, you know, apply use cases into having a sort of streaming app.

And I don't just mean streaming and communication, but streaming the actual updates to the app and the pieces of the app, you know, through HyperCore. And then also slash tags, which is kind of a layer utilizing and providing a bunch of use cases for HyperCore as well. What HyperCore is, just as a refresher for anybody who cares or doesn't remember, it's basically like a souped up DHT, which is kind of like, think of it like BitTorrent, but with a few different characteristics that make it have a lot more power and a lot more use cases than BitTorrent. Namely that it uses these append logs as the file structure, which allows you to also now have keys be the thing that represents these logs. Just like you have Bitcoin keys, you can have pub keys for drives and for data, basically.

And so this actually ends up becoming a really powerful and cool primitive for rebuilding the web entirely. It allows you to have a lot of asynchronous capabilities so people don't have to kind of be communicating directly or online at the same time. It allows a lot of scaling capability because you have like mutual means for files instead of global state networks.

So it challenges a lot of the use cases you might see blockchains trying to champion. It shows that you can kind of do pretty much anything that any Web3 blockchain or any blockchain is claiming, really, without a blockchain at all. And so Slash Tags shows how to kind of have metadata or any kind of data associated with a key that represents an actual entity, like a person or, you know, a server or a website. And so while Slash Tags could easily be called an identity system, it is a little bit more abstracted than that.

And so what we do is instead of explaining all of this, because it's, you know, I'm, I'm sure that this doesn't quite make sense to a lot of people who aren't like P2P enthusiasts or decentralized web enthusiasts. We just, you know, show you in BitCat, here's what you can do. Just, just in the earliest stages of implementing this stuff, here are all the cool things you can do. and and if you combine these things with bitcoin and user experience and if you actually like are thoughtful about you know what features and what problems you can solve for a user and so in bitkit we have kind of two major categories of slash tags how we've implemented it and keep in mind we don't say slash tags in the app we just have these features and so we have a public profile which is kind of like the concept of if you have like a Twitter profile except it's

it's within this system so your key controls the profile you own the profile it's not owned by us or some website it's yours and when you update the data only you can do that because you are the one that key has the key and it requires the key to be able to do that and so you have this nice area and the top of the wallet where you can like look at your profile at an avatar choose whatever name you want. You can add like a link list, sort of like Linktree or one of those kinds of things. And you can add as many links as you want. You can have a little bio, et cetera. But what we did was we realized it's really cool if you kind of combine this concept with contacts. And, you know,

usually in your phone, like you're trying to import your contacts from your old phone or another phone. And it's like this database that you manage. And eventually for everybody, it goes out date right like you have old stuff in there um and so this gives you a way to have the contacts be the same concept as like a social media profile except your contacts own their profile and so when you add someone or follow someone or add a contact to your contact list what you're actually doing is you're adding their pub key to your list and then you are pulling the current version of their profile every time you're looking at it automatically from them and so it's their data and so it's always up-to-date with whatever they want to be in there

and they can put anything they want in there and another cool part about this is we've made a payment protocol within slash tags as well so you can actually pay your contacts and so this this makes it so like when you hit send in the wallet yeah you can put in a Bitcoin pub key or lightning invoice because it has those features but if you want to instead you can just choose somebody from your contact list tap on their face choose an amount and click send and i mean i really mean it is that simple you also don't have to like configure an invoice or anything like that because we the protocol the payment protocol we have inside it actually looks at what payment methods are supported by the peers and

that you can support in your app and it matches them it says okay this person can receive this right now and you can send that right now and it just matches the top thing on the list and it just does the payment in the background so the user doesn't see any of this they just say you know john uh i want to send to john here's how much and they hit send and then the apps figure out the rest and so this is really a way to abstract a lot of complexity and and even more so in the future because right now we just support bitcoin and lightning but if we add things like later like we talked like we'll probably talk about like pair credit or you know different types of uh bolt 12 bolt 11 ptlc channels htlc channels lightning address all these different

things that you have as payment protocols in bitcoin we can distract them all below your pub key of your identity and so you can just do the matching in the background the user doesn't have to know or care what the current trend is in things it just has to know whether or not you support something they support. So yeah, that's kind of the first half of features of SlashTags in Bitkit. Do you have any questions or any comments on that stuff? It seems like it's going to be a big UX improvement in terms of sending and receiving Bitcoin. Is this the intent of designing it this way? Yeah. Well, the intent was, like I said, I wanted to make it something that users

didn't have to be bothered with how it works. They can just be the least amount of friction between the problem they're trying to solve and the technology that makes that problem solvable. And so, like I said, like it's just send, like when you wanna send, it's as few steps as you would think and it works how you would like it to work.

You just, you know, I wanna send to Marty, I choose Marty, I choose how much and I click send. When you wanna receive, it's just a QR code. Like there's no configuring or anything like that. There's no telling you what Bitcoin is or showing you weird keys that you've never seen before. It's just a QR code, pay me, and you can share it, et cetera. And in the QR code, we support the kind of the multi-QR. So there's a Bitcoin on-chain address and a Lightning invoice inside when you're connected to Lightning.

And it does both at the same time. So, again, the user does not have to know that Lightning exists to be able to give you a Lightning invoice. now the cool the other cool part of this is yes we're making this very user friendly especially for new users or normies but all of the features you would want as an advanced user user in there too like you can go in settings and you can turn on coin selection you can go and when you hit receive and you can tap on customize invoice and actually create a lightning invoice like you would normally do in a lightning wallet all of the features are there

They're just, you know, they have to be chosen, you know, by the user. So, yeah, definitely user experience was a big goal of ours to improve on. And I think we have, and I think you're going to see more because we have a lot, a lot of cool plans for what we're going to do moving forward. And I haven't even talked about the widgets side of things yet. okay let's get to the widgets because i want to definitely want to touch on slash tags in the context of what seems to be an increasingly competitive space uh in this web 3 web 5 whatever the fuck we're calling it um realm where you have noster like fiat jeff and that's actually the name of a presentation i did is web 1 2 3 5 what the fuck um and i i did a

presentation here in lisbon at our meetup but yeah sorry go ahead yeah whatever it is so i mean you have obviously web 5 block team working on that uh mike brock uh daniel you have what you guys are doing at slash tags you have uh people working on noster fiat joff and jb55 and it seems like i mean it's exciting for me as somebody wants to use these types of products to see competition begin to heat up with these different things um let's talk about the widgets then we'll get to that competition sure so yeah the the other area of features in bitkit that is unique for a wallet is you know not only do you have your bitcoin kind of wallet where you can see how your total amount of bitcoin and you can get details like you know about uh your on-chain

an off-chain balance and we express this as spending and saving spending being lightning balance your lightning capability and uh savings being your on-chain capability um and you can there's also some cool ux in there for like there's like just a slider when you want to like move your off-chain your on-chain bitcoin to lightning it's just a transfer button basically and when you hit the transfer button there's a slider it asks you what percentage of your bitcoin You want it to be on Lightning. And what that actually does is it's like integrated with BlockTank, our LSP server in the background. And we don't tell the user this.

And it actually just requests a channel and purchases a channel from our LSP. And so the user, again, doesn't have to know about how this stuff works. They just say, I want to be able to send Bitcoin and pay instantly. And they choose, they opt into this. But yeah, with the widgets, sorry, were you going to say something? Yeah. I was going to say, so the user doesn't have to think, but obviously one of the questions that comes to like an advanced user's mind is like, what are the trade-offs? So you can do it. You can do it normally as well. Like, as I mentioned earlier,

like all the things you would want to do, or you've done in other wallets are also there. It's just the path that you choose. So when, when you're like onboarding for lightning, it doesn't say, you know here's what the lightning network is. It uses channels and unique capacity and blah blah blah what it just says is quick setup or custom setup if you choose quick you get the slider if you choose custom you get a user flow that's basically you know frame one how much of the how much of bitcoin do you want to be able to pay instantly in you know and frame two how much bitcoin do you want to be able to receive instantly frame three confirm your channel you know your chain and then it gives you some details like what the what this will cost to

do like the fee basically that we charge how long the minimum time will keep the channel open and you can actually tap on that to customize it if you want to so all the things you would want for control are still there there's also a section in the settings where you can do like a channel manager and see all your open channels manually close channels if you want to it's got all the normal lightning wallet features it just has paths for people that don't care about that stuff that are low friction and you can just go into the easy path if you want to so it's like a souped up autopilot yeah and we actually have autopilot features in there too for coin selection um by default when you know it it's an autopilot mode for coin selection when you're you know managing

your utxos and there's actually like two or three autopilot modes like one for like minimizing utxos one for maximizing privacy you know these kinds of things or you can just turn on manual and just choose UTXOS. So it's got all the features. And if anybody sees any features that things are sorely missing, we'll consider adding them. For example, Francis Puglio from BoldBitcoin, he had a rant not too long ago where he was like, the perfect Bitcoin wallet would be this and that and this and that. And I noticed one of the things in there that he really wanted, we didn't do. And I said, that could be tricky user experience wise. And then he brought it up again after he tried the wallet he's like the wall it's great i love it but why don't you have a passphrase like

the 13th word in a seed phrase and i said well i'm i wasn't sure if we could do it in a way that would like not confuse a normal user who didn't know what that is or care about it and then so after he requested it we we know alder and i look took a look at like how we could do this and alder figured out a way to do it pretty pretty smoothly and so we will put it in maybe not the next version because we're doing another version update probably next week but probably the version after that and so you'll get that feature too if you want to use it it'll just be you have to opt into it so a normal user will just like make a wallet and skip their seed but if you tap advanced you'll be able to add a passphrase as well um but yeah sorry that's the uh wait didn't i forget if i

was uh if there was another part of your question there no as i asked about trade-offs explain them yeah so yeah i mean there are trade-offs in in technology there are trade-offs in user experience we just did our best to kind of put the the easy choice right in front of you with the least friction and then if you want more complexity there's an obvious thing for you to tap on to access that complexity um so the widgets uh the cool thing with widgets okay so widgets are like these hyper core feeds in the background as far as the technology goes but they can be served by anyone and they don't have to be like partnered with us you know with synonym or any special like requirement or or permissioned process by us it'll just work if you use you know the slash tags sdk

and spec um and so we've included a few examples in there to show people some of the things you you can do with widgets but the general idea is these can be like like souped up or more powerful like sort of like rss feeds just a data feed and so we have some examples there where we we we run a uh a data stream a hyper core um where we are compiling all of the latest rss feeds for all of the popular bitcoin websites and so we call it bitcoin headlines and if you add this widget it's just basically the latest bitcoin headline and if you like the headline you can tap on it and read that article it'll open it up in a web browser and but the cool thing here is like that widget could be created by anybody it doesn't have to be served by us could be served by anybody

could be any type of headline any type of style you wanted and any app that wanted to implement slash tags could show the same widget in their app and so it's like it's introducing this idea of like like app Legos or interoperable little modules that you can have that work in anything anywhere from anyone anywhere and you don't have to ask permission there's no like app store in between it's just you know if the user wants this they can scan a QR code and basically follow the pub key for that feed and it will generate a widget inside of the kit that'll be like underneath you know the widget for your wallet card or Bitcoin card your balance

there um but it gets cooler because yeah data data feed is something you probably could have always done and tried to make this interoperable but these data feeds can be about your key for example so say what we'll show very soon uh bitfinex has it working they just haven't exposed it in the ui yet but bitfinex is going to allow you to have a slash tags feed of your account and so in bitkit you'll be able to without visiting bitfinex at all you'll be able to see like your balance on bitfinex or your profit and loss on your current trade basically any data that bitfinex wants to put in the feed could be rendered inside of this this widget window inside of bitkit and so imagine now any any bitcoin app or any app for anything could do this so in your in your

bitkit wallet you can see like your balance on bitfinex you can see your current um reward points in Bitrefill. You could see the latest replies on Stacker News. Anything correlated or related specifically to you could also be a feed. And so this gets interesting, right? Because now BitKit isn't just showing you your money, it's showing you your data or your account data from anywhere. And anybody can do this again without interfacing with us as a company. They just have to create the feed in a way that bitkit understands that's it um and then finally uh you and your listeners are probably familiar with like logging in with a key right you have like ln url auth and some other thing you know probably web 5 stuff and web 3 stuff i know like ethereum

has like a web connect or these kinds of things with metamask it's not a new concept but we've kind of turned it up again and added a lot more capability because we can associate data with a key, right? And so what we do is instead of having like an URL auth where it's a one-way authentication and it's merged, basically your account is merged with a domain name, which domain names are inherently custodial, right? And censorable. The website is a key, you're a key,

and you don't really even care where the domain name is, which means if you're trying to say, log into a website that is censorable, like say the Pirate Bay or something, and they get their domain seized, well, the Pirate Bay can spin up a domain anywhere. And as long as you know how to find them wherever they are with their key, you can still authenticate with their website. And so you can see how this is like showing how this kind of circumventing of DNS entirely is giving people this uncensorability. And it also makes it harder to be middleman attacked like if you try to log in with slash tags to a fake bitfinex website all that will happen is it'll create a new account on that website they would they can't they don't

have your account so they can't prove that they are bitfinex and so the worst thing that would happen is you'd log into a fake bitfinex that had didn't have your account in there and so it kind of prevents this kind of middleman attack as well that domains kind of inject into things and one One more thing about it is once you've established an account with a website like this, you can also, instead of scanning, you don't even need to scan the QR code anymore. You can actually just tap on the widget to log in because it does, it can do the key authentication in the background, receive a deep link from the website and just log you into the website automatically.

Just so I fully understand this Pirate Bay example, obviously, yes, DNS is very centralized. in this example where you authenticate via slash tags with the pirate bay basically the way websites work because they have a back end filled with data that's feeding a front end that just connects to a website and that website due to dns is a centralizing factor dns can block that website at any point so what you're saying with slash tags authentication if for whatever reason both sides authenticate basically those sides authenticating um yeah that you're they're authenticating that you're a user and you're saying hey this is how i want to interact with your website uh because the website you're trying to you know the key of the website right and so

because when you make it when you make an account using slash tags you're getting it from a key in the first place right and so that website is now a key to you and so no nobody else but that website has that key you know assuming that you know the feds don't go and find the person and confiscate the key um much like confiscating a bitcoin it's much more difficult thing to do than confiscating a domain name yes so that's where we that's where uh what i want to make clear you're separating a website which is an entity from the domain name which is like a url associated with that entity so yeah if they confiscate the server there's nothing you can do right but they can confiscate the domain name and then they hydra pop up somewhere else and you just authenticate

the URL can be completely different. So the censorship resistance is that the domain name doesn't matter. Normally the key matters. And the safety or security difference is the middleman, if he does manage to middleman you, you try to sign into Blitfinex using slash tags, then all that will happen is another widget will pop up. You'll have two widgets, one for Bitfinex and one for Blitfinex and your Bitfinex account will just look the way it always does and your Blitfinex account will be like a zero balance account and you'll just be like okay that's not that's not what I'm looking for you know and they won't get any secret info from you they won't get your password they won't get anything it's pretty fascinating what I mean

obviously this is all dependent on Hypercore and again go back to my conversation with Palo last month he got me really jacked up about this what do you think needs to happen in terms of adoption of hyper core that layer to to make this all mainstream is it bringing apps like a bit kit and normalizing slash tags and then people recognizing the utility of that is there anything in terms of user adoption at the like protocol hyper core level that you think needs to happen to really throw gas on this fire sure there's there's a few things that need to happen including i'll try to end this with a segue to the competition um but you know aside from the competition there's just general business development you know adoption of the technology

and that's something you know we're dedicated to we have a dedicated business developer that's just for slash tags and doing integrations and we have you know several people on the team already that assisting with integrations. And we have already at least, I don't know, at least half a dozen people implementing right now. And so you're very quickly going to see more and more people creating widgets, adding authentication to their website. And it won't just be nobody's, it'll be people you've heard of. Right now, even on launch, we already had somebody that had implemented the authentication on launch day, Starbacker. They're kind of doing an OnlyFans kind of website. And they really like all the things I just described to you, you know, the

ability to have the data come from a DHT. So they don't necessarily have to always host the data and they can kind of move over to this less censorable format. They don't have to have an email address from the user. The user can have a profile that they control. That profile can be portable. They can be uncancellable. All these things are really great narratives for a website that's trying to kind of compete with OnlyFans but with Bitcoin and do social media stuff. And so they're really excited, and they're going to be supporting a lot of the features that we're doing as well.

But, you know, as I mentioned, we have Bitfinex. You're probably going to see stuff next year from Bitrefill and other friends of ours that are implementing. But basically we're dedicated to helping people implement this technology because we know that bootstrapping is work, and it's new. and we want to make sure it's easy to do so the more times we help people implement it the easier we can make the process and polish you know the tools that are required and make it as easy as possible um also some you know other things that have to happen aside from just adoption and

business development are everything we do is javascript and you know hypercore is node.js we use a lot of node.js stuff our app is react native and if you aren't compatible with the stack you are pretty much in a roadblock to implement this stuff until we go to the lower level and start um re-implementing hyper core modules and in a native language like rust or c++ or something and so we're already talking about that because i want everybody to be able to use this and so that's more work that we'll have to do is identify which of these you know aspects of hyper need to be recreated in native language whether we need to make like you know binding language bindings for popular languages things like this so there's just going to be there's going to be endless work

honestly to do just to keep polishing everything and to keep adding there's just tons and tons of use cases because you really can rebuild the whole web this way and so we have a lot of cool features we have planned for 2023 we're doing road mapping now but to kind of bring this back to the competitive thing one tricky part about all of this is like i've learned that interoperability is kind of like a meme. It's not really a real thing. Interoperable means like if everybody does the same format you do, everybody follows the protocol you follow. And while you have things like LNURL using a key to log in and slash tags using a key to log in, I've already explained how the process is actually pretty different, right? And they have different interactions when you're

trying to do the process. That will also be true with DIDs and Web5. It's true with Metamask and WebConnect and these things. And so interoperability isn't just on the protocol, it's also in the languages that I mentioned. And so if everything that, I don't know what Web5 is doing, let's say if everything they're doing is in Go or something, then you're going to have this kind of legion of Go people using their stuff, a legion of JavaScript people using our stuff, and who knows, you know, and LNURL people using LNURL stuff. And so there's going to be actual competition, not just across features, but across protocols and specs and across languages, language stacks.

So it's really tricky for the user because in the end, they don't give a shit about any of this stuff. They just want it to work and they want it to work as much as possible and do as many cool things as possible. So I think the competition is going to end up being more on user experience and shipping and solving problems and giving people features that really excite them and give them capabilities they couldn't do before. I don't think anybody cares if I put out a pitch deck or deck that explains all the architecture of HyperCore and here's a node and here's all pieces here's a dht like yeah builders and people that are enthusiasts will care but users no they

just want it to work they want it to you know behave how they expect it to behave when they need it to and that's it and so that's why our focus is mostly on simplifying things and showing you know here is something you can do that you couldn't do before yeah i mean it would be pretty massive if we can re-architect the web I'm just imagining like we're in the process here at TFTC of open sourcing

our BTC pay server ghost implementation and that's something DJ who's our CTO has been building this out, packaging it up for people and I have been talking about for a while is like we would love to hack ghost

where we could have users log in via something like LNURL auth or something like slash tags, like hacking that in. And you can begin, just in my mind thinking this through, it seems like there's an easy path, particularly with open source technologies like Ghost and BTC Pay Server, where you can just gut a certain part of that stack, implement this stuff, and you don't have to re-architect that CMS or that payment processor from scratch.

You just become interoperable with your guy's system. Yeah, I don't know a lot about Ghost, but it sounds a lot like WordPress. And that would be the idea is that as this gets popular, more and more tools that people are used to having are going to need to be integrated with these features. And it's not a coincidence that we're using Node.js and JavaScript and React Native.

these are all very web-friendly, you know, it's a very web-friendly stack, and we care about rebooting the web, and so that's why we're using such a stack, and so I think that it'll be a little easier for us than people who do not make that decision, but they'll have some advantage and trade-off or whatever they chose as well, so we'll see who's right. I'm pretty confident in in the tech you know both the design of the tech the architecture you know dht as a underlying structure for the network and append logs as a structure for the data like i couldn't find anything better that made more sense to me so i'm pretty confident and happy with what we're choosing um but we'll see how it plays out because yeah somebody has to write like a plug-in

that lets a website you know a wordpress website be able to offer slash tags keys as accounts for to log in instead of email and password or in addition to. And all of these things are gonna take time to kind of rebuild this infrastructure that people are used to having. Although some of it will be possibly obsoleted with some of the multi capabilities of some of these features.

Like, I don't know if we really need email anymore, for example, like you can use these drives as basically inboxes as well. Like the primitive of the design here is basically I'm a key and I have a drive that I own about my key that only I can put data in. You're a key, but I can also make a drive about you that I put data in that is only for you.

And so if you do the same thing, now we have basically the entire primitive of the web. I have an account for you and I have a drive for me. You have an account for me and you have an account and a drive for you. And that's all we need to be able to do everything, chat, messaging, websites, CDNs, Google Drives, everything you want to do can be built from those primitives.

This may be a stupid question, but it's mobile first, obviously, but it'll work on desktops, laptops as well, correct? Well, right now, Key is on desktop only, and I bring up Key because they are also using, you know, the same underlying tech. And so yes, on desktop. And I believe that Keats whole punch platform when they open source and release it, I believe in December, they're going to do that is primarily for desktop. Bitkit is obviously mobile. We did it in React Native because we wanted to be able to bring it to desktop at some point. We don't have immediate plans to do that. I'm in the middle of roadmapping. So by the end of the year, I'll have a more clear

picture on exactly what we plan to do for 2023. But I'm skeptical that desktop bit kit is going to be on that roadmap. And then web, you can see that we've already started implementing a lot of the use cases there. And I don't just mean like for the website, I mean, being able to do like slash tag stuff, like, you know, using your keys, not like as a user, not just as the website. We've kind of shown how you can start doing some of that stuff already in the, if you go to our website. We made a website just for slash tags, slash tags.to. We have like everything you would want to learn about slash tags there, all links to all the code, all the modules. And we have this really cool playground. And the playground is something you can interact with, with BitKit

to kind of test both the technology and see examples of ways you can apply this tech, but also, you know, actually be able to have it in your hands and, you know, see how to implement the user experiences for this technology so it's a lot of hand-holding a lot of you know giving people ideas of what they could do and i think that uh if you're creative you'll realize that you can do pretty much anything with this stuff yeah that's fascinating and then key management keys are created on device stored on device on your phone if you're using big kit backups very similar to backing up private keys for i'm glad you brought that up i forgot to mention that um the key stuff is actually pretty cool like this isn't just like crude use of keys there's actually

the the the guys at hole punch um helped us with some of the underlying structure of the cryptography that the team has cryptographers and they're very talented and we have the key chain aspect of slash tags and how that works is we actually use your bitcoin seed and so when you want to restore your bitkit wallet literally all you need is the seed and that seed you can that we have a derivation path to generate a master key for your slash tags now slash tags doesn't use the same curve as bitcoin like you can't send bitcoin to a slash tags pub key it's not the same format but you can derive the that key from your bitcoin seed and so when you restore your wallet what it does is it checks your bitcoin addresses just like a wallet normally would it like uh it

knows your your lightning information and it knows and it can automatically generate your master slash tags key and any keys that that could generate and now for your slash tag stuff it goes and pulls it from the dht it says oh here are all the keys that i followed and it starts downloading them, just like downloading a bunch of torrents from any of the seeders that have that data. And Synonym, our company itself, we actually redundantly keep backups for free. So you don't have to use iCloud or Google Drive or these things like this. We have your backups as well, but only you can retrieve them with your key. And so as long as you have your key, you can get a backup from us, too, of your lightning state, your lightning channels, everything, your

wallet metadata, all of your contacts data. And so, you could also recreate the entire experience offline without accessing the DHT, as long as either you have a copy of the file of your data in your seed, or you at least retrieve a copy from us. either way, the amount of connectivity you have, it will just start seeding everything from whoever has it and populate your entire wallet from just a seed if you are connected. And so that's really cool. And then in the upcoming version, we're going to implement the added feature with the key structure where we're adding tweaks. I don't know how much you or your audience know about

these. I've only just started learning about them a couple months ago. But the tweaks are a way to basically solve problems with multiple devices. So like if you want to have your slash tags, you know, contacts and different data in one phone, but also on another phone or, you know, in one wallet from us and also a lot from some other company, or if we end up making a desktop wallet, you want to have it in both places and they will synchronize. And so you can actually have the same account in two places. Like this is something you can't do with lightning, for example, but you'll be able to do it with slash tags. And so the tweaking allows you to basically create like these topics around keys and the tweaking has a bunch of other cool features too

like you can make it so a select group of people in your contact list that you want to if you want them to can be able to find you in any platform so i could say okay uh is john using starbacker and i could check for his tweak you know within starbacker and see if john has a it could be my current pub key or any pub key related to that tweak to see if i'm also there and they could find me there and see if i'm there but only if i share that tweak with them and so that tweak is just a way to have a topic around keys to associate them voluntarily and so i believe key association is a cool problem and a cool way to address what other designs are doing differently like for example web 5 is using key rolling and key revocation and they're using bitcoin as a

broadcasting mechanism but the problem with this is it has an assumption that you will never lose your master key now if you're willing to take that assumption you don't really need a blockchain you can have a hyper core drive that people treat as an authority the same way and just go ask that drive right so we we we are with all of our products continually proving that you don't need a blockchain for anything but bitcoin and so that that will follow through later when we talk about pair credit if it follows true when you talk about slash tags but yeah i'm ranting now the cryptography behind the key chain of slash tags is cool as well yeah i've never heard of tweaking that does sound really cool and useful on top of that i mean we're not we're not the

inventors of it by any means i think rgb uses tweaking for some things and i wouldn't be surprised at all if web 5 uses it for some things too it's very useful um it's when you do p2p stuff you have a new set of problems that are actually really difficult to deal with um and so you end up having to innovate sometimes in different ways and tweaking is one of the ways to kind of compensate for some of the trade-offs of p2p yeah p2p web what are the biggest hurdles or not hurdles but biggest like what are the scaling issues with this what is holding it back what are potential problems with hyper core or the drawbacks um so i would say i guess yeah i never got to actually comparing to the competition which i think is maybe related to what you're asking like

you know what are the trade-offs from this design compared to another design as far as just scaling in general like this structure is meant to be able to be done by anybody like using a potato for a computer as long as they're doing it peer-to-peer if you're trying to do something at scale then you have to be able to have somebody who's providing that scale for you but the cool thing about this design is because the data is only writable by your key in In other words, it's authorized data with integrity. It's like a blockchain. It actually, the append log uses blocks too.

And so, but because it is a block, and because it is appendable and you can add data, it's cooler than a BitTorrent because you can have a data stream, you can update, it can represent a website, it can be a video chat, it can be a chat room, whatever you want. But again, because only your key can write to your drive, anybody can host your drive.

And so it doesn't matter if they like you, if they censor you, whatever, they can't change the drive. And if they do try to change the drive, people won't see it from them because it won't have the integrity that they're looking for in the header of the file. And so to get scale out of the system works the same way as the web works now,

except you're not locked in, there's no walled garden. So you can have, say, a hyper cloud, you know, like instead of Google Cloud or Amazon Cloud, except it can be any server you want, any provider you want. And they can all have different, they can all compete on their prices and their download speeds and their availability. And you can have any, you can have as many seeders as you want and have that data as redundant and available and geolocated as you want. but they can't censor you other than just say i'm not going to see this data for you anymore get somebody else to do it so you can still have scale like this is one of the problems with p2p stuff is yeah decentralized twitter is cool until you figure out how the hell you have to scale this thing because you can't even if you own your twitter feed you can't have a hundred thousand

followers you know always constantly downloading from your laptop to get your latest tweet it doesn't work. And so what you want is you want to give users the ability to do that when they need to or when they want to, to render the data locally and provide the data directly. But when you need scale, you can still have that option because you have integrity for the data. So that's not a trade-off per se. I'm kind of telling you a bit of how the system addresses the trade-offs because I think all of the trade-offs are addressable. I would say the downside would be some of these things are not yet proven at large scale, even on the P2P level. So, for example, like in Keat right now, if you try to have a room with a thousand people in it, it probably will blow up

because you have all these different connections from all these different people trying to communicate asynchronously, but then have this eventual consistency. You're going to get weird things happen and i'm sure matthias would would tell you how they express but my guess it would be something like the the chat feed would like look one way one minute and another way another minute and kind of update almost like when you're downloading a website and it's not giving you all the page you know in a row it's giving you certain parts first that it gets first because that's how the seeding works right it's like bit torrent so some seeders are going to give you some parts of the file faster than other parts and so if you fall behind you're going to get weird

user experiences until everything catches up and if you have a thousand people spanning in the room like say in a twitch chat like when you get these guys spamming emojis the whole time then it's not going to keep up and so you have to now make sure that if you're trying to do something at scale that you are designing it in a way that can scale and so you have to make sure if you're trying to have a thousand person chat or have a hundred thousand twitter followers that you are using a scaled CEDAR as a service and not trying to do it from your laptop. Does that make sense? Yes, it does. Now, I don't know enough about the architecture of Web5 and Web3 especially to say where they're

better or worse, so much to say that I know that Web5 is not using a DHT in CEDARs. I know they have a concept of a decentralized web node. And so I'm going to guess, forgive me, Dan. I know he hates when I misrepresent his project because he's even more competitive than I am. But I believe they're going with expecting that the user will have a server. Kind of like expecting the user to have their own Bitcoin node, expecting them to have their own Lightning node. You're expecting the user to have some kind of at least online all the time server. That's my guess. Now, maybe they probably do have some solutions for addressing asynchronous or when the user is offline, but as far as I know, it's not a DHT. It's something else. I haven't looked into it lately to see what they're doing for this kind of stuff. another trade-off there is for the identity system they are heavily specced up and so they're

they're following did they're creating specs they're very very spec oriented and they want to kind of lead the design and lead the bootstrapping through spec they want to say oh you have to follow the spec here's the spec so they're prioritizing you know making these specs detailed and giving people something they really have to follow closely and obey a little more than probably we are prioritizing and we're prioritizing instead like putting it in your hands bootstrapping it making easy to use you know things that get us moving faster and things that are less rigid you know like like the the drives that we use these these hyper drives to represent the data for a slash tag they're just a drive and you can put whatever you want in there the widgets and the

feeds they're just a drive and you can spec you can shape the data however you want we we believe that the schemas of the data will compete and so the most popular schema will be the one that is supported by the most people but we don't think we don't want to pretend that we can control the spec of that like we don't want to pretend that we're going to be the ones to be you know touched by god and magically know what the exact format is going to be best for everybody and so we're kind of leaving it a little more abstract a little more open and so that's cool because say did spec does become like the spec everybody expects for when they're doing you know any type identity stuff with keys. Slash tags can do that easily. You just take a drive and

you just support the DID spec inside of a hyperdrive and that's it. It's not a problem. But what if that isn't what it is? Then Web5 won't be able to do that. They're specced, you know, they use rigid spec. And so that's a difference as well is that they're heavily specced. They're trying to like get W3C to like, you know, bless everything they're doing with their specs. They're a little more, you know maybe complicated in their stack but this may provide benefits to their stack I don't know I like I said I like our stack a lot then another difference would be that they support they depend on Bitcoin for their

identity stack as well so which means that there has to be a Bitcoin note somewhere and involved with their identity process we don't have that dependency so if somebody is not interested in Bitcoin they can still use use slash tags and that doesn't mean that if they're interested in shit coins it means if they just don't want to talk about money at all it can be just a website that has nothing to do with money it's free website and they could use slash tags you know um or it's a website that you don't have a balance of any kind but you do have an account they could use slash tags so it's it's a little more free form um and so there are trade-offs there as well fascinating that's really

incredible to see how far this has come since we were in my backyard a little over a year ago maybe exactly a year well i mean it started honestly some of this design started like 13 years ago um i started trying to think about this stuff back before i even was in bitcoin um i i probably said this in a podcast i'm not sure it was yours but part of the oldest inspiration of synonym was i was a huge google fan and i wanted to get a job at google but i'm not an engineer and i was like how can i get them to hire somebody like me i know i'm creative i know i can offer them something i just want to work there and so i started to design a google killer and said like oh if i go to google and i show them how i'm going to kill google they're higher they're hiring me

for sure um i never made that attempt but i did work on the design a lot and it is part of the primitives of what we're doing with slash tags interesting what was your google killer original design uh so we haven't gone to that stage yet with slash tags but we had to build in other words it requires all the things that we're putting in place to be able to do the design that i would kill google with and we will we will make this design and i don't can't promise we will kill google but we'll definitely give people the option to kill google um and so the idea you know to put it pretty simply is to inverse the relationship of the google algorithm and its users to which the users are the algorithm and so instead of telling the user what matches

their search the user tells the web of trust or their their network the people they whoever they want to ask could be one server they literally ask a rule or they could ask 50 people that they trust and they could ask 20 people that they trust only in a specific way but what they do what you do is you you assume the website is all the data, the web is all the data, it's just this noise of data, face melting everything. And what you're trying to do is you're trying to take, give people these knobs they can turn, like noise filters, until they get the sound that they want. And what this basically is, is giving people a way to customize their perspective on data. And it's essentially how they weight

data and so google does this a little bit and you know a very simple way to express what i'm explaining is when you click the image tab in google you only get images right um and there's metadata related to images the searches in the context of images when you type something in that search bar and then you choose images google interprets it differently right and that's a perspective so google did and when i had this idea the tabs didn't even exist in google yet It was still just a search bar, and I'm feeling lucky. And then they evolved, like, the news tab, the images tab. And so I saw they were starting to get the idea, but they never added –

never gave the user capability for them to choose the weighting of the data. And that's the difference is if the user chooses the weighting of the data and the template of the search, not just the search term, but, like, what qualifies within the search term, they become the algorithm. They get to weight the data and they can take different perspectives when they're searching for different types of data. But it won't be just, hey, I'm searching for images. It'll be, hey, I'm searching for images from my family. I'm searching for images from my family, from people that I actually like the images of these family members. You know what

I mean? Or I'm searching for tweets that are from famous golfers that are also interested in weather forecasts, you know, and like, you can start applying these weightings to use these as searches and as, but really filtering of the data instead of searching the data. And you're saying, here's my filter. And you ask the, and you ask the peers that match that filter, what do you have under this filter. And then you get a new perspective of data. I hope that makes sense. No, it makes sense. It makes a lot of sense. Oh, here's another cool way to look at it. A perspective could be much like you apply it to Twitter again. Instead of me having a Twitter feed of all the people that I follow, I could say,

show me Marty's Twitter feed. Show me what Marty sees when he's looking at his Twitter feed. So I take the perspective of everything you filter out and you care about, people you follow, people you've blocked people you've muted and so i can take your perspective and that's the difference here is it's it's taking perspectives through filtering data and organizing data and that data and also on the sense of who you are even asking for the data in your mind what is the magnitude of this shift in relationship between individuals and the web if you're successful, if any of these projects are successful in creating this flipped model of a more decentralized web

compared to the hyper-centralized web that we have today? So while I can't say for sure whether I've got the right formula, I think this approach is necessary and inevitable. And so I think we'll end up there eventually, but there may be roadblocks on the way, roadblocks like the big tech may make it much more enticing over time to just stay and keep things the way they are. The government may make it difficult to be as free as you need to be to be able to accomplish this goal. People just might not give a shit. They might not want to

think about it. They might just enjoy the free ad subsidized web and not want to click an extra button or configure their own web of trust or really think about who they trust more other than how many people follow them or how rich they are. Humans might just like these really crude heuristics for measuring things and just not be ready or have the time or interest to be more granular about how they manage their reputation. So that makes it kind of mine or whoever is in the future that continues to trust all this problem, makes it our responsibility to really show people again, here are things you

could do that you couldn't do before. Here's the power you have now. And here's how easy it is for you to wield this power in a way that helps you and solves problems for you. And I think we can do that. I don't know how long it will take to finish, you know, the technology and making the tools or how long it will take for people to adopt and care about it. But it is my passion. And I it's worth building and i think it's extremely complementary to the ideals and mission of bitcoin as well because bitcoin is like self-sovereign money and this is all about like self-sovereign data it's like your self-sovereign digital life basically and this is the whole formula yeah yeah again there's so much competition you get like the web 3 stuff then you get into

like start line labs umbrella like these uh well start on some of the things you mentioned are actually complimentary. StarMine Labs, Umbro, even Nostr is fairly complimentary to what we're doing. Nostr could use slash tags and they could take advantage of HyperCore DHT as a data structure underneath and still do all the work that they're doing. In other words, Nostr is not on the same competition level as Web5 or Web3. Web3, I'm honestly not worried about at all because they're just going to fuck it up because they're going to be they're going to be distracted with trying to you know force a blockchain into this and force an investment into this somehow and so they have to fuck up maybe inadvertently they'll make some good research like ipfs is not horrible um i prefer

the structure we're using to it but it is actually one of the better uh research outcomes of shit coinery you know file coin is useless but ipfs itself they've been working hard for a long time to solve b2p problems i just think they made some decisions i wouldn't i wouldn't have chosen and and my my engineers feel the same way and so we don't really use it although there are some tools they made that i think we do use like that we don't use like their their whole structure but they've made so many things that there are some tools that are just generally useful that they have as well um so there's there's that um but yeah uh web start nine and umbral these are home servers right so like these could be you know hyper core nodes and they could be seeding data

and and downloading data from the swarm and they could be participating as well as a matter of fact uh i i hung out with most of the start nine team when we were in the bitcoin amsterdam conference not long ago and i slash pilled the fuck out of them i'm pretty sure i'm pretty sure they're excited to talk again and see if see how we can get something slash tags represented somehow um in their system as well so not everything is competition some of it is extremely complementary hell yeah hell yeah i'm excited for you i'm excited for humanity excited for bitcoiners i'm excited uh well i'm excited to begin testing it out is tftc in the uh the widget rss feed do you have an rss yeah are we not in the headlines widget that would be pretty

Pretty miffed. I doubt it. You could make a TFTC widget and that was only your feed if you wanted. Maybe I'll do that. Maybe I'll skip right to that. But this is like a podcast feed, right? No, I'm talking about the newsletter. Oh, no, no, no. Oh, now I know what you're talking about. Sorry. I thought you meant like the podcast. So, I didn't actually know. I always thought of it as an email. And so, So I never, I always forget.

I see the links in Twitter. I just never made the connection. I always thought of it as an email newsletter. Pretty miffed. Sorry, man. I'm fucking with you. I'll get right on that. No, I'm fucking with you.

I'll literally tell them right now to add the PFC RSS. Actually, we may have to add RSS. I could be just bullshitting my ass right now. Oh, come on, man. You're trolling me hard now. Why is my mouse moving so weird? Where? Anybody who's so interested that's listening right now.

Obviously, download BitKit. Where are they compatible? Is it Android, Apple? Yeah, BitKit is available on Android and Apple. Lightning is not fully unlocked on either of them. It will work with small transactions on Android. It will not work at all on iOS. but we are literally testing tomorrow a build to fix that um i'm not sure if it will make the the

the ship the ship time early next week if the lightning will be fully unlocked but that's the goal is within either next week or at most two weeks after that to have lightning working um but yeah android um and ios we have a website for each product now so you can go to bitkit.to to learn all about bitkit and all the features and get all the videos and stuff about it we have slash tags dot to to do like anybody who wants to learn about implementing that or the playground slash sdk and we have blocktank.to as well if you want to look at the lsp stuff um side announcement with that was um we have a new kind of service for blockchain called blockchain instant which is just a dedicated api for exchanges to be able to just add lightning depositing withdrawing without

having to run a node at all and without having to hire a lightning person at all just trying to really push for exchanges to support lightning so we have that as well we have a website for block tank and then of course we have the synonym website synonym.to so anything you want to learn you can go to those places we have telegram chat we have a discord chat now um github is synonym dev all the links that you would want you'll find what you're looking for and you guys are hiring in the bear market yes hiring and hiring multiple node js devs hiring a marketing manager so we can start building a marketing team to start promoting bitkit once it's out of beta um hiring a project manager because i can't manage this whole team the way i used to um because it's growing uh i've

never had a company with this many people before we're at about 14 now and we're about to add four more so i need help um and we're hiring what was the last thing oh another mobile dev um to help uh add some more man manpower to the app team oh yeah it's a good good signal hiring in the bear market a lot of people are going in the opposite direction um all right well thankfully our owner our primary owner uh tether is not involved with any of these uh scary lending practices and has operated you know intelligently conservatively during this past bull market and didn't have to worry about 3ac exploding and celsius exploding and uh but ftx is shorting tether right now shorting tether is like nonsense right because you go to tether and you redeem the

tether and so the only reason to care about a price movement out there is if tether stops redeeming then you that is a major signal right because now tether is not backing its word um and so far that's not happening i believe paulo was just tweeting today how they just they just processed 70 million or something of withdrawals and there's no issues with withdrawals right now on redemptions i from what i read if it's even true because sam was saying something about how the twitter rumors aren't even true but what i read is that somebody is trying to make some sort of play where there's low liquidity and the d5 structures that use stable coins and so they tried to kind of like empty one out to be able to like off like they tried to like like monopolize

one so they could like empty out another one and cause a lot of slippage and so this affects like the averages because now all of the exchanges that have tether are trying to arbitrage the slippage and so it causes an overall slightly lower price like i think tether was trading at like 0.995 instead of one today um and if you short tether in a huge amount at high leverage maybe it's profitable i don't know i'm sure shorting tether if it actually crashed would be very profitable but that doesn't appear to be what's happening you know i don't i don't of work at tether and have a behind the scenes view or anything i'm just regurgitating what paulo has tweeted and what i see yeah and having spoken with paulo last month i mean it was really

impressive how they handled redemptions during like the celsius 3ac blowups they did billions of dollars in a matter of days it's weird i mean yeah yeah he was telling me it was something like they don't they're not sure if there's even a way to measure but they think they they process like the most you know uh the transfer of the largest amount of money ever of any uh entity including large banks like they couldn't find any example where anybody had ever redeemed or processed that much money that fast and ever so i think they're okay yeah for anybody worried about their short term commercial paper exposure it's not there anymore um yeah they've been transitioning out of that of course you in the end like i don't want to pretend like this isn't about shilling

feather like in the end all constructions for stable anything the main question is who do you trust i don't care if it's a stable channel an oracle a hedge a stable coin it doesn't matter the main question is who do you trust because you have to trust somebody to be able to convert value from meat space into digital space. No matter what the design is, there's somebody trusted that's doing that. And so the question is always, who do you trust? And so that's why we work on reputation stuff is because I believe trust is always going to be useful, even post hyper-Bitcoinization. We just need to give people much better tools for managing and measuring that trust so they can make better decisions about who to trust and what to trust them with.

and so with tether you can say okay look they've existed x amount of years they've had here are the the actual problems they've had here's how they have responded to those problems and then you can compare that to any competitor and say who do i trust and really the question is first i guess is if you even want if you even need it like if you need it then you decide who you trust if you don't need it do something else don't become obsessed with whether or not this is a systemic risk or whether or not they're like not showing the right audits because audits are bullshit proof of reserves is bullshit all that matters is if you trust them because if they're not trustworthy they're going to figure out how to get rid of get around any type of attestation or

any type of you know system they put in place to make you feel safe they have to be trustworthy if you know that and that's the end of it yeah yeah the uh the proof of reserves memes come back this week the best proof of reserves is to move bitcoin into a wallet that you control i don't like the trend while i appreciate the research and the science of it i just don't like the trend of bitcoiners having a lot of interest in custodial tech and like like i just feel like something like proof of reserves you figure out this real cool cryptographic way to to show everybody that you have their Bitcoin, it just makes people think, okay, I don't have to worry about who do I trust anymore. I have a system. But this is not true. Custody requires

trust. I don't care what contraption you put in the middle, trust is required. And that's true of any custodial system. And so Bitcoiners, the reason why Bitcoin is great is it's trustless. And so if you're not using Bitcoin in a trustless way, why are you using Bitcoin? so that's i i don't think that we should get too excited about custodial science because in the end bitcoin was made to stop doing that yes stop leaving your bitcoin on exchanges i mean i mean we have people like ud going out there and saying oh exchanges are a safe place to hold your bitcoin uh here's my wrestling ftx being one of them here's my ref link and I think he's

yeah I think he's sufficiently burned his reputation certainly this week well I would have thought that a long time ago but I don't know like

whenever I say something reasonable the more reasonable thing I say the more crazy people seem to think I am so it takes some time for people to

come around to things they uncomfortable truths I guess you could say yeah I think I've been on the UD train with you for

a while seems to be a provocateur maybe uh yeah he was a troll and he was fun when he was making fun memes but i don't know let's stop talking about yeah let's talk about rbf all right how big of a problem is this in your mind i don't think i mean it makes sense to me so let's well let's start with that um i i had a a way of framing that like and i made a tweet about this because this has been on my mind a lot lately obviously um sorry how did you how did you word it just now it makes sense to me rbf so don't confuse ability with utility just because you can

rationalize something does not necessarily make it an improvement or a utility that is like something that must be done and should be done like it's very difficult to have the entire picture when comes to something that involves like the whole human ecosystem complex systems multiple systems interacting the dynamics of the bitcoin system and the economy and humans and it's like it's very uh egotistical to think that you could possibly grasp all of it into a comprehensive mental model right but it's something that we're all basically inherently trying to do anyway and so i find And a lot of the arguments around RBF kind of make this misconception, they say, because it makes sense to me, it must be, and that's it, it just must be.

Because I can rationalize this and I see a path that I can solve this equation, then this must be the reality that we have to force in place and strive toward. But that isn't the whole picture, it never is and it never can be. none of us can predict the future and none of us can fully explain the present and because of that i think that things like being much more conservative about changing bitcoin being much more humble about when you do change bitcoin or when you do have theories about you know your designs for bitcoin or your designs for anything really um these are important values to have because you might be wrong and you might not even be held responsible when you're wrong

and everybody might agree with you and you might all be wrong and everybody might not actually be everybody it might just be your friends or it might just be people that are trying to agree with you for political and social reasons and there's all kinds of weird dynamics at play that being a kind of stoic moral uh you know benevolent person is extremely difficult even if it's your number one goal um and so being humble and conservative is is probably paramount in these situations especially when now you're you're fucking around with you know people's life savings they're relying on bitcoin to be for them be there for them and and in very important ways for the for very important people to them and so starting with this abstract concept um what's

going on with rbf is there is a gap between go ahead for anybody out there's new to bitcoin listening rbf replaced by fee it is a mechanism that allows you to uh if you send a transaction it's not going to confirm to the block uh the way you can make that transaction potentially get confirmed faster is replacing that fee that you initially attached to it with a higher fee which would entice miners to include in the block so there's a bit more to it than that yeah so i guess since we're describing rbf let me let me describe it add some nuances there because you need the nuances to be able to kind of fully judge the situation but so the way bitcoin works is you have a mempool and when you want to get a new transaction added to the blockchain

you kind of send this transaction to all the nodes and they store it in this mempool but the mempool is not enforced it's not something that is like regulated by the the consensus protocol but there's still an aspect of consensus to it because the behavior of nodes and how they manage the mempool and how they relay these these this information to other nodes has its own policies And you have to have a process there as well, because if you don't, you have spam problems and denial of service attacks and things like this. And so because it's an open listening network, you have to have some rules for how you handle this pool of data. And until now, the way that that mempool has been handled has a rule called first scene. And first scene has, you know, I'm not expert in this.

And actually, the mempool is like a whole area of expertise that specific Bitcoiners are really specialists in. And I've done my best to kind of learn about it. And I've learned a lot about it, you know, even more about it in the past week or two. But there's this first scene policy to where the way that nodes normally behave until now is when they see a transaction, they keep that transaction. and if you try to send another one afterward that uses the same UTXO it discards it and part of the reason I think is because this is a free option kind of thing like I can just keep sending new versions of the transaction and keep you know keep bothering all the nodes and keep getting them all to update until the next block or actually perpetually I can just keep sending

remaking this UTXO and so at some point the nodes have to decide okay what the fuck UTXO am I trying to spend here right is it the newest one is it the third one is it the middle one should i be waiting for the next one and eventually there's like one has to get in the block and the miner has to pick one and so but the nodes also have to choose which ones to share and so first scene says just keep the first one you see because this is like having some integrity to the network it's saying okay this is what the person wanted to spend let's just push it through and spend it Now, there are people who want to be able to replace this transaction. They say, okay, well, I made a mistake, or even more importantly, I didn't put a high

enough fee in there. Now my transaction is just kind of stuck. The blocks are full and the fees are high and I didn't put a high enough fee and I'm going to have to wait until another policy kicks in place, which is when the expiration, when a node will just drop it. And then when they drop it, you can kind of send another one and they'll propagate the new one right but you know you don't necessarily want to wait till all that time I believe it's two weeks or so maybe you want to keep you know trying

and you want to get into you want to get into a block but you want to pay the lowest fee possible and so RBF does it says when you make the transaction you can turn on this flag this little note you can add a little tick box to this transaction that tells all the nodes hey this transaction instead of keeping the first one if you ever see a new one throw the old one away and use the new one but i but only let me do this if the fee is higher and so now there's an entry cost so there's some there's some friction right like you can't start you can't spam the whole mempool because you have to keep increasing the fee to replace the transaction so there's being it's like incentive compatible right

this behavior so this is useful right like i can i can make sure my transaction doesn't get stuck I can play the system to pay the lowest fee possible. Everything's great, right? And that's what we have today. It does work. If you flag your transaction as RBF and you send a higher fee and replace it, you can do so. But there's a little bit of trickiness here. So RBF doesn't only do that.

It also lets you change the destination of the transaction. It basically lets you recreate the entire transaction. So, if you're using this to kind of scam someone, for example, and they don't know about RBF, then you could create the transaction and say, hey, Marty, yeah, here's that 50 bucks I owe you. Look, there it is. It's on the blockchain. And, you know, you go to a block explorer and you see it. It says zero comps, but you're like, all right, whatever. Usually when I see zero comps, it's fine, right?

Nobody has ever double spent me with zero comps, so it's fine. And if you don't know about RBF, then you'll think it's fine. but then as soon as i show it to you i leave and i and i make a nutrient i replace it with a fee replaced by fee and i send it back to myself instead of send it to you and then you never get the money now because there's a flag on it this double spending attack is pretty hard to do right because marty is not dumb and he knows about rbf and the block explorer is also pretty useful and it says replaced by fee you know it shows the person that this is not a normal transaction and so you don't really hear too much but you do hear about people getting scammed with rbf because

it is something that you know you can scam the ignorant with but you probably will hear more especially from bitcoiners about the utility of it because now you can you know you can optimize how you spend fees you can unstick your transactions um and and you can opt into this thing but let's get to the zero conf part sorry if this is too detailed but it's an important thing to understand um with zero conf what what happens is when users want to spend bitcoin on chain they go to a merchant and we use bit refill because this is exactly how big refill does things um well i mean not exactly but yeah this is very still is a zero conf accepting merchant and the user said i want to buy a gift card and they go and buy a gift card but they put a low

fee on it or they have rbf on and then uh bit refill says to them oh waiting for confirmation and they're like oh what the fuck is a confirmation and they go and learn about confirmations and then they learn that they're on average they're gonna have to wait 10 minutes and they think to themselves okay well when i buy a gift card with my credit card i get it right away when i buy a gift card with my bank account or whatever i get it right away like why am i using bitcoin for this when i when i don't even like spending my bitcoin you know why don't i use my fiat instead or why don't i get a credit card from crypto dot whatever and put my bitcoin balance there so i can use the credit system and get instant you know satisfaction and many many

things that people purchase they don't they're not going they're not satisfied with having to wait 10 to 40 minutes like and sometimes blocks are even less reliable and so for a merchant trying to accept bitcoin and now keep in mind but bitrefill has been a pioneer and and reckless when it comes to supporting lightning so you can't say just use lightning because they do but the problem is most people don't use lightning yet and that includes bitcoiners and so people want to pay with bitcoin at bitrefill and sometimes they get shitty user experience where the next block doesn't happen for an hour okay that's fine you should know that's how bitcoin is you should accept this but the effects of this are bit refill has to have customer service people that understand

this bit refill has to feel the ticket from the user and users are never nice to customer service when they're not getting what they want and they're saying where's my fucking order um please give me a refund blah blah blah and then the price of bitcoin changes and so now you have this weird situation where you are in custody of your customers' funds. You have customer service trying to deal with them and keep them happy. You have to make a decision about whether you're trying to fulfill the order still or refund the person. And now the person might complain because their Bitcoin is worth something different than when you send it back to them. And you've created all these second order effects because of the delay. And also in the delay, you get exposure

to the FX yourself. So suppose you do give them the card, but now the Bitcoin is worth 5% less. Now you're losing 5% of your margin because of this. And so time is a cost. And it's not just a cost in FX. It's not just a cost in the abstract. It's an actual measurable cost because you have to have more customer service capacity to deal with these situations. So what does Bitrefill say? They say, okay, well, if we accept zero conf and we limit our exposure to zero conf, basically what we do is we say, okay, if you want your order instantly, make sure your transaction fee is at least this high, the rate that you pay, because they do a fee estimation. They look at the mempool and they look at the latest blocks and they say, hey, if you pay five stats per virtual or whatever it's called, we'll accept your transaction immediately. without waiting for it to be in a block. And if you turn off RBF, well, wait a minute, why?

Why do I have to turn off RBF? I could double, you know, a core dev will say, they can always double spend you. This is a factor whether you use RBF or not. While this is technically true, the first scene mempool policy actually makes it much more unreliable and much more difficult to pull off. And so basically it almost never happens.

I believe you could ask Sergey, but I believe they have been double spent for a small amount one time in all of the years that they've accepted zero conf because they have a policy of how they accept and when they accept zero conf. And until very recently, I probably will have to stop because this is going to change. We had all these cool plans for updating BIP21 to be able to leave it so the wallet could have rbf on all the time but only turn it off when they were paying a merchant that supported you know these these best practices and these policies so basically the user would get the best of both worlds when they weren't trying to pay a merchant that cared they'd have rbf and

they could like manage their fees and undo their transactions when they were using a merchant that cared the wallet would automatically change the settings just for that one transaction and we have and we were going to make tools for merchants to be able to like automate and choose their their exposure to this risk and so you know another aspect of a bit read for those they say okay um per block because the risk only lasts one block right because eventually things confirm or they don't and you can cancel the order or accept it um per one block deep what is our maximum amount of zero cough exposure we want to have out there and so they'll keep taking orders within a a 10 minute time period and they'll say okay we've reached i don't know what their what their

limit is we'll say fifty thousand dollars we have fifty thousand dollars floating in the mempool right now of exposure and if they're all double spends we'll lose fifty thousand dollars cap it stop accepting zero conf until the next block and then they reset it when the next block comes in they look at the situation and they reset it um but that that cap has never even come close to being approached. Nobody has planned some wide attack to try to reach the full saturation of that attack and then repeat it. And if that did happen, Bitrefo would just have to stop, right? If every block that you were being attacked for the full amount, the amount would go down and down and down and down to zero until Bitrefo, they would say, fuck this. But because they do this, they

accept this exposure and they manage their exposure to this risk. They actually save money because now there's less customer service tickets there's less exposure to the time risk it's in the abstract effects etc and customers are happier they so it helps the bitcoiner it helps the bitcoin merchant and it helps bitcoin compete with other payment payment forms that that are instant including some shit coins right because you can say oh just use litecoin or something right and and what you don't want is people like converting their bitcoin to litecoin so they can buy things with it because now you have conversion costs you have utility for litecoin um and and this is like bitcoin not it's like moving away from being money right and you need we need

people spending bitcoin and people and merchants accepting bitcoin people getting paid in bitcoin for bitcoin hyper-bitcoinization to like kind of actually realize itself and i i would say this is objective, but I guess I'll just say it's my opinion that these things are important. And so hopefully you can see so far, you know, the relevance of zero-conf acceptance that Mary-Phil nor I am I saying zero-conf is safe, but we're saying the risk exposure is actually manageable mathematically and programmatically and automatically, and we can give the user both utilities. We can say not only do you have RBF, but you also have zero-conf when you need it.

but this requires and leans on the first scene of mempool policy and so recently as part of a staged effort which which several developers will admit to there is no bitcoin core the organization so i can't say bitcoin core planned this so much as there is a culture of developers that all want to see rbf all transactions be treated rbf by default and what that means is when i send a transaction to the mempool to get added to the next block whether i flag rbf or not that that mempool is going to essentially turn on that flag for me they're going to opt me in to this behavior and they're going to not do the first scene policy they're going to do the they're going to treat every transaction as the rbf policy every transaction is replaceable so they're taking

what is essentially a money network and saying at the mempool level the behavior is nothing is reliable and everything can be undone. There is no assurance in any way. Now, of course, Cordaz will tell you that was always true. There was never any assurance. A miner could always choose any transaction they wanted to. If the miner was the double spender mining their own transaction, they could skip all the mempool entirely. And so the double spend risk is always there but the but my theory is that zero confirmation and rbf are actually both incentive compatible and that's actually why um bet refill is very rarely double spent when they're applying their methodology and so the concern here is now the stage that we're at with the stage process

that is known and eventually will, you know, totally and intentionally and unequivocally, sorry, whatever the word is, it will definitely make zero-conf impossible in any fashion. But we're kind of in this middle stage where what they're doing is they're adding a feature to nodes where they can turn on this policy. And so it's a very insidious thing because they're not actually turning it on. They're just saying, hey, everybody, we gave you this new button.

And if you use this new button, then you will kill Zerokov. And you will make all the transactions that whether they decided to flag RBF or not, they will all be RBF. And if only, say, 10% or 15% of nodes turn on this button, then it works because of the nature of how the mempool propagates. You don't need a majority at all. You just need 10%, 15%, or maybe one or two major miners to flip the switch. And then Zeroconf is effectively dead because now every transaction becomes programmatically and mempool-enforced replaceable. And so that's what the debate has been about. It's been basically, please stop with this passive-aggressive plan of killing Zeroconf.

and the debate the nature of the debates has been very gaslighting for people like me and people like like sergey at bit refill because they're leaning on where we started where they see a rational path they say okay like the all these transactions were risky all the time they were never safe and so you shouldn't be doing that it's like okay but we never said they were safe we're telling you is we found a way to to limit our exposure to provide utility to bitcoiners And one more thing before I ask you if you have any questions, this is actually also pretty important for Lightning. So in BitKit, we literally accept zero confirmation payments for channels in Lightning. And so right now, we haven't added zero conf channels yet, but when you combine zero conf channels with zero conf payments to buy those channels,

You can create an instant experience for somebody where whether they're on Lightning yet or not, like when we add, we're going to add just-in-time channels, JIT channels, and we're going to add zero-conf channels, and we already have zero-conf payment acceptance for channels. Once you combine these three things, for somebody that opens a wallet, they don't know what Lightning is at all, even if they do know Lightning. it doesn't matter if they're just not connected they can go from zero you know not not connected at all to receiving or spending bitcoin instantly they can say okay i want to be able to pay instantly okay you do here's what it is what we try you know pay this fee for uh opening the channel and configuring your channel and and relying on our lsp um and as soon as you send that payment the channel we accept the payment the channel is opened and you're either receiving or spending immediately and that's instant right like that's a this is a huge like way to present

lighting people to say hey look not only can you does your payment get accepted instantly but the channel gets usable instantly and you can spend or receive from it instantly and you can even receive instantly when you aren't haven't even opened the channel yet with jet channels as long as you have all this flow in place and so the mempool policy changing interrupts that flow It says, no matter what you want now with Lightning, if you're opening a channel, you're going to have to wait some confirmations. If you're paying for a channel, you're going to have to wait some confirmations. And so we've added, depending on how you measure and what you're doing, 10, 30 more minutes

to the process of onboarding to Lightning, which is really shitty for somebody who has no exposure to Lightning yet, and really not that great for people who do. And that's my story. I think I got mostly everything. I think you did too. because this has been raging on the mailing list for all you haven't even seen the github so there are prs to there were multiple prs that were made no not yet um there are multiple i've been behaving myself um i've been trying to actually be you know uh reasonable and present

arguments and share you know these perspectives i shared with you today but people are mad man like they do not want to hear it they do not want to you know entertain this soft type of rationalization that it's not about that we're saying they're safe it's like we're saying that the risk exposure is manageable um they don't want to even consider the trade-off of what is better the utility of no matter whether they turn it on or not them having the ability to undo or update their fee or the utility of being able to pay instantly and they won't even weigh that and the thing is if they do nothing they don't have to weigh it you get both still that's that's like the triggery part is if you just leave it alone everybody still gets what they want but because

you change it you you now say oh well people who didn't opt into rbf can use rbf now and that's cool that's a feature we should make we should give that to everybody but the cost of giving people a feature they didn't opt into is losing zero conf as a feature and so that's the trade-off but they they will not entertain this and so there was actually a pull request for somebody but the tricky part here is we didn't catch wind of this until the tail end of the development of this feature and it is already in the release candidate and so for for bitcoin core 24 this is in the code and they're just like kind of doing cleanup and getting ready to launch and then we're like hey hey wait a minute what's going on here and so uh you know some developers were kind enough

to kind of speak up in the mailing list and be and be rational and kind of trying to argue our side as well um and even made pull requests to remove this aspect of the future from the release candidate but now because it was in the release candidate they are painting us as we're the ones trying to change bitcoin because we're trying to remove a feature that hasn't been launched yet and so they're trying to say oh you're the roger there john you're the one trying to change bitcoin it's like no i'm just saying that like the bitcoin i have right now on the live network is the one i want to keep please don't meddle with it please don't change it this is very useful to me and i have plans to like really leverage that usefulness for bitcoiners for lightning user

experiences etc um and and that the the debates in there are even more interesting than the ones in the mailing list if you want to go back and do research but there there was some lots of back and forth there with the proponents of the full rbf and and me and some other people against it um and that got really really strange you know some of the nature of the arguments just didn't feel very genuine um they would conveniently say like this act like it's a voting system oh we have 30 devs like you know disagreeing with you john it's like okay but where like there's no users here like is this a vote now or is this like an intellectual debate and they're like so when they just keep it's like a circular arguing every time you counter their method they choose a new method

and you just get nowhere um and this has been very it's actually been very disappointing and very defeating for me to go through this process because i've tried interfacing with core several times and it's never gone well it's always been like something like hey we're going to kick you out or or hey like you know we're going to kick your friend out or you know hey you're you're crazy and you know you're you're doing bad things and um this is good and you're trying to stop good and you're trying to change bitcoin and it's just like i i've never actually as a non-core dev as a non-engineer i can't seem to find a way to interface with that group um and whatever man like i'm not trying i'm the guy that was like that that became known at all because of taking down

roger fair and for people to try to treat me like i am him just because i'm trying to protect a current bitcoin use case it's pretty gas lady man like i don't know what to do about it and apparently today right as we started this episode they posted that they are going to keep the chain because the pull request ended up getting closed by the guy who made it and so that was like a huge defeat because even though he made it that you know and oh the author of the feature antoine Henriard. He agreed with the poll request to remove it. So even the author said, this is too controversial. I see how there's two sides to this. Let's remove it from the release candidate for now. Even the author did it. But because the guy who made the PR closed the PR, and then the author

didn't recreate a new PR, there was actually no candidate for this. And so it just became a default mode of it's in and so now that it's in core took the advantage to say let's ship this fucker and get it out there and now they're shipping it and so they announced today there's like a big like i was reading it when i was waiting for you there's like this big like long message in the notes for the release warning merchants like this change has happened if you're using zero conf please be aware you know you're this is this is video conf is not safe it never was safe you know you're gonna have to stop now all this shit yeah it doesn't seem too great he yeah i mean because what really stood out to me was i mean you've mentioned bit refill

at synonym you guys have intentions of incorporating it as well and i i wasn't aware of like i've just been following the discussion on the mailing list at arm's length it's been going on for so long i'm just like holy shit like i can't believe this is still going on um i wasn't aware of like the risk trade-offs and the the calculation there that there is like actual risk management on the zero conf acceptance in bit refills case what really stood out to me we talked about it at bit devs here in austin last month was the moon teams email to the mailing list. We're like, hey, this is going to affect 100,000 users.

Well, that's the triggery part. People say just use Lightning. Everybody that's fighting to not have this mempool, full RBF thing, uses Lightning. And we're some of the first people and some of the favorite people using Lightning. And we're trying our best to use Lightning and to get as many people to use Lightning as possible.

but lightning is for commerce it is commercial technology and so don't tell us just use lightning we're trying but that just because you accept lightning doesn't mean you can tell your customers but we don't accept bitcoin like you have to use lightning it doesn't fly it doesn't work and if you force people to use when they use bitcoin to always wait go through shitty experiences if you force them when they're trying to onboard to lightning to have to go through a long wait period and confusing or god forbid customer service um they're going to use something else and that's the problem here is do you want them using something else do you care i think these engineers will say no that's not what they're going for we don't care use lightning

and the argument goes circular again and the the funny thing is is i even got accused peter todd was accusing me of i don't know what he's talking about he's like john has a product that he wants to launch that uses this and i think that if we delay this decision until the next release because some people were saying let's just keep talking about this take it out of this release keep talking about it and deal with it in the next release which that would have been nice you know to actually have not this deadline of pressure out of nowhere um and he said john's gonna if we do that john's gonna rush his product to market and argue that because he has users using this that we shouldn't do it and it's like okay like first of all i have no idea what you're talking about

we already released our wallet it already uses zero conf and i have no secret product that i'm going to rush to market um even if i did so what like oh my god people use this horrible like it just the arguments were so crazy to me so i can't think of just gaslight gaslight gaslight so much and um yeah like moon uh dario sergey dario also mentioned like many atms rely on this for a good user experience imagine having to stand there and there's not a block right and you're waiting to wait 40 minutes in the atm to get your bitcoin like people will just use something else man they'll use a shit coin that moves instantly they'll use cash they'll use fiat they'll use credit forms of credit and the funny thing is we have pair credit which we haven't really talked

about yet um that's actually our you know technology that we're making with hole punch and tether and bifinex and apollo um we stand to benefit a lot more if people use credit credit and use our system instead of bitcoin at the payment when they're checking out and i'm fighting to not i'm fighting for bitcoin here i'm not fighting for credit i'm trying to be john the bitcoin maximalist and again get bitcoin in the hands of everyone using it for everything um and somehow they're just keep twisting the conversation and twisting the arguments and it just makes me not want to interface with them at all ever again um so i maybe i'm not going to update bitcoin core anymore i'm going to make an effort to not update it at synonym anymore but this is also a little

impossible because there are some bad not bad but um not ideal practices in lightning where usually when when core updates lightning ends up updating and using the most recent version of core as a dependency so lightning implementers lightning merchants etc we're kind of forced into a constant update policy like we don't really have a choice to like choose the stablest oldest you know version we have to keep updating this is dangerous because an update you know doesn't have a lot of history to it and so a vulnerability might not emerge for six months and so it's i like having a policy of always using stuff that's six months old can't really do that so much with lightning and so at least personally i'm not updating my core node anymore and i've

learned there's even trade-offs with that luke dasher is teaching me that you can't actually fully validate some SoftWorks stuff and that SoftWorks get pretty hard over time. Anyway, I'm rambling. Sorry. No, I mean, have we learned this lesson in the last two months, too? Which lesson? Like updating. Oh, yeah. With, like, the L and D bugs. Yeah.

Yeah, yeah, yeah. That's the thing is, like, you're going to force me to update. core starts being a little too reckless and they start having maybe not money losing bugs but downtime bugs this affects businesses you can't just be down again people will just use something else and they'll use something that they can rely on and unfortunately centralized things tend to be reliable and a lot of things that people use money for they're not really as worried about censorship as other things and so the the the nuance of these debates if you don't respect the nuance at the design level, nobody is going to respect the nuance at the user level. And so I don't know how relevant it is, but this has just reminded me of a really nice sentiment that

Sergey said to me, which is nuance is antiviral. And I don't know if it's his idea or if he read it somewhere, but I think it's extremely apt. You have to think about what travels is like memery, right? A meme is like a distilled, simplified and abstracted idea. And so that means the opposite would be nuance and so nuance is antiviral and it's very difficult to convey it's very difficult to propagate nuance and so you kind of want to make sure you're respecting nuance at the design level and because you're not going to get a chance to do it on the social level it's very true trying to think through because i've heard from some core devs that they would argue like oh bit refill moon john they're just kvetching we've been but we've

been warning them for years that this is coming and telling them to prepare it's their fault for i mean that that wording isn't exactly true that maybe it would be fair to say we have known that zero conf has been unsafe forever we all have known this before i looked at very so i was with them zero conf no fucking way at least one conf i remember when it was three comps i remember when it was six comps for everything um but as you know the the network became you know harder to roll back we've moved to pretty much everybody except for exchanges have moved to one comp um but the thing is everything is rolled is able to be rolled back like if you want to be like you know technical about it like one comp isn't safe either two comp isn't safe

either 20 comp isn't perfectly safe either and so i see it all the spectrum starting from zero cough. And as long as you manage your risks appropriately to the depth of security, you're going to be fine. The worst case scenario is if they just left it alone, Bitcoiners may have this utility for decades to come. But the day that it actually breaks, like when the prediction becomes true, Bitrefill loses $50,000, I lose $20,000, and we stop doing it. And that's it. God forbid, you know 10 years 20 years 100 years of having this utility costing us you know some thousands of dollars and not having to hire uh extra customer service people not having to have unhappy customers god forbid that finally comes oh no like i think that this is like i know it's

a soft rationale and it's not something you can you know rationalize absolutely perfectly but you can keep it in a range you can actually manage the risk and when you do it's it's a service and this service will no longer be possible after 24 after 24 most likely it will no longer be possible we've started thinking about ways to accept rbf zero conf and we have a few ideas but they're not cool like it's like if people double spend you we can do like a mutual destruction game where we spend the entire amount you know to the miner and cpfp it and weird things like this but it just gets super messy yeah i'm trying to think my mind now why does it need to be mandatory at the level so the argument i'll give you one of the arguments so green wallet does rbf rbf by default

um this is why i don't use green wallet because like my mobile wallet i used to buy stuff one of the things I use to buy is gift cards at BitRefill. And I forget sometimes, or if I use Core and I accidentally have RBF ticked on, when you do that, BitRefill says, hey, you got to wait. I'm like, fuck, I don't want to wait. I have my shopping cart open. I want to use my gift card. I'm ready. And I get annoyed. And so I don't use GreenWallet because of the RBF on by default. And I don't know what the current state is, but the last time I checked, there's not even a way to turn it off. They literally already do RBF by default for all their users, but their argument is so niche and so asinine, in my opinion, it's this. When the mempool is congested and when blocks are full, we get tens of people come to us and say, oh, my transaction is stuck.

What can I do? and we say you know if they have a you know we tell them if they have their own output they can do cpfp but otherwise you have to wait for the mental to drop it and not pin the transaction anymore and then you can try sending it again um and what they want to be able to say is oh if you use you know our wallet which understands rbf you can just do rbf that's all they want is they just wanted to say you know even though you didn't turn on rbf you're in your city situation now you can go ahead and use it because the mempool enforces this policy but the thing is like this can all be handled at the user experience level like a wallet could simply say well but wallets already

do fee estimation right they could look at the fees they can look at the mempool they can look out the block space and they could just say hey uh there's congestion right now rbf is turned on or they could just turn it on and not tell the user you know what i mean like all of these things are entirely manageable they can be dynamic they can be intelligent and this it's actually really cool that you can do this but instead of being creative instead of being user experience specialists they're just saying let's just make everybody do what we think they should do and I just don't think the edge case of if we have a handful of users at some point

that want to RBF even though they didn't opt into it then we can tell them it's going to be okay well it's going to be okay regardless it's going to be okay faster then that's worth deleting Zerokoff I don't think that's a good trade-off I don't know if I do either like they're yeah they didn't opt into it they didn't opt into it and every single wallet has

the capability to to give them the way to opt into it and force them to opt into it and give them the way to turn it on or off every wallet can do that yeah i feel like this should be it's a problem i feel like this should be like a bdk pr where it's like hey right as you're broadcasting a transaction you should have a pop-up that says do you want to rbf this And you click yes, or just only pop it up if it's appropriate and say, okay, like, in other words, RBF could just be a tick box. If you want to have like an advanced wallet or whatever, it can just be a tick box. RBF on or off.

People who know what it is can know what it is. You can put a little exclamation point on it so they can tap and learn what it is. And if they turn it off, you can tell them when they should turn it on, or you can just turn it on for them. If they turn it on, you could tell them when they should turn it off and we can create specs and tools for this for merchants for wallets to completely dynamically handle this without bothering the user at all they'll all you know the same thing that i'm trying to do with lightning we could make it so rbf is always there for them whether they know that rbf even exists

and you can do it all at the wallet level yeah i've been getting a steel man this too i've had situations like literally in the last two weeks where i said a transaction and i didn't have rbf enabled i was like what the fuck like i actually need this to get through uh and it took longer here's another tricky part here the merchant wants the same thing and so remember the merchant wants to once get once assurance that this will be in the next block and so when the merchant is doing zero conf they're always making you pay the right fee that's a it's a really tricky nuance that when you realize that like the only time we care about zero conf is when you're paying a high enough fee to be included in the next block so you're not worried about rbf

no but for my situation the merchant what didn't really give a fuck about no but so what i'm saying is you could leave your wallet and you could leave rbf on all the time right if your merchant doesn't give you give a fuck that's fine if you don't give a fuck that's fine you'll always have the ability to deal with your fee and furthermore you could do tricks putting cpfp all the time probably also like you could just send an output to yourself every time regardless what you needed one probably your cpfp and by the way bitkit supports both cpfp and rbf rbf is off by default as of the next version but cpfp can handle many situations for incoming and outgoing transactions depending on the situation um and so you still have that as an option and

many times when people do want rbf they do have an output to themselves because remember when you're spending you're really spending the exact whole amount of your utxo and so there's always or very often, especially when you're paying a merchant, there's another output to yourself that you could see PFP with. And so that's another nuance here. And the only time typically that you're spending an entire UTXO is when you're depositing to an exchange or self-sending. And in those situations, the timeliness is usually not important. Exchanges are making you wait three comps anyway. Self-sending, you're probably just doing some of UTXO management or mixing or something. When you actually look at the use cases,

the arguments for full RBF become extremely narrow. And if you talk about actually intentionally managing this at the app level, you end up basically eliminating all of them. yeah yeah so i hope uh odell listens to this interview because he seemed very skeptical of me and and critical of what did he say i know it was only it was only a moment in but i did happen to catch that episode with you guys and i was like oh come on man like give me a chance i think by now you guys know that i'm not crazy and i'll always have bitcoin the best for bitcoin in mind um i wouldn't be doing this just to be an asshole i i certainly know that matt if you are listening this could be a good digital dispatch episode maybe that's

that's something like you should get you and one of the core devs that's advocating for rbf by default yeah i mean there might be some things i wasn't as nuanced as i should have been about RBF. I have my own biases, but I do have the user interest at the top here. This isn't about my business or about my products. I would be making this argument if I worked at Bitrefill, if Synonym was dead. I like Seroconf. I like using it as a user. I like having that option and I want to keep it. Yeah. You can use the heuristic developers, particularly backend engineers more particularly protocol developers, more particularly distributed system protocol developers

aren't always design focused and user experience focused? Well, I was talking to... Actually, it was a private conversation, so I won't say who, but I was talking to another developer I respect. And what he said to me was that he didn't think that this was a cross I should die on, but that this argument maybe would would supersede the whole thing he doesn't think that core should be involved in policy and he doesn't think that that bitcoin core should be like involved in mental policy that it should just be user defined and they could just avoid these conversations entirely by not making these features by not by not behaving this way not getting involved in policy and on this we we

definitely both agree you know like i just don't think that we should be designing user behavior I have a saying from before Bitcoin, from just doing regular old design for websites. There's no such thing as bad usage. There's only bad design. And so as long as you give people the tools that they need, you don't get to decide how they use them. And you don't get to decide whether how they're using them is good or bad. You just have to make sure that the tools you give them, you know, solve problems for them. And, yeah, you don't want to, you know, place a bunch of foot guns in there for them to use.

But you do need to do your best to do no harm and stay out of the user space, in my opinion. Agreed. And they're just going to brute force this through? There's no, like, is there any last-ditch effort to get it out, you think? uh i know i'm not actually familiar entirely with the release process but it's been marked release so i'm pretty sure it's done um but the i guess the shred of hope is that the current incentive structure is actually so strong that less you know that maybe only two or three percent of nodes even turn this feature on um so that's still a possibility

But the problem is, it just makes the inevitability, you know, much closer. Like, I agree with the engineers that this is inevitable in some form of rationalization. Like, someday, some miner is going to see that there's enough people accepting zero-conf where he decides to behave badly, start attacking. but this attack would be at the risk of themselves this is the other thing like there are there are there are real world consequences to stealing from people and stealing from people at scale is not always very easy you know oftentimes even if you're anonymous um you get caught it's hard to be a large minor um and not and be anonymous and then steal from people and then not get caught and i just i don't even mean from like regulations or the law i just mean like when you wrong people there are physical consequences and if they weren't police and law they would be mercenaries and they would be uh hit men and and there's always going to be consequences to fucking people

over you know like it's just always going to be a thing and so the incentives are our meat space as well they're not just protocol incentives it's that like that mostly people want to be they like bit refill existing they like you know john making lightning uh easy to use and they like you know bitcoin and so while this sounds you know like like uh naive if only one or two percent of people are actually evil then they actually don't have enough power to exploit this and so it ends up working out on average and even if they do or when they do the attack and the vulnerability is very short-lived because either they start exploiting things and everybody stops the behavior or they get caught.

And so the incentives are much softer and not as easy to interpret as I think engineers realize. Where they say it is very rigid, like this is going to happen. Yeah, this is unsafe. It's like, okay, I know. Let people take risks. like yeah like bitcoin's not safe like investing all your money in bitcoin is not safe like there's no price enforcement in bitcoin you don't know for sure whether it's going to be worth

something when you go to spend it there's no guarantee there there's no guarantee that the person you really need to spend it with will accept it it's not there's no enforcement of bitcoin value um it's not actually a battery um and so so you know like that's risky too and is that in the code does it say like be careful don't own too much bitcoin no it doesn't you know what i mean does it stop you from having too many bitcoins in your wallet like you know like it's it's crazy we could talk about this all day it's been a fascinating two hours has it been two hours i guess yeah i talked a lot fuck sorry there's lots to talk about yeah we didn't we didn't talk about pair credit do you want to

try that for a little bit and then end it or you want to just end it let me see i've got to get going here unfortunately okay well then i'll then i'll plug it and say we actually just did a two-hour spaces on pair credit with me matthias and paulo and that was recorded And so you can go to the pair cred handle on Twitter and listen to that space if you want to learn more about it. What's the one minute pair credit pitch? We figured out how to do credit or essentially tokens, digital bear instruments without a blockchain, which means, and without lightning, which means that you can do direct peer to

peer, you know, stuff like stable coins and gift tokens as a concept without needing routing, without needing liquidity channels, without needing lightning, instantly, no fees, no blockchain, no bullshit, and we'll be releasing code and specs for that in Q1, Q2, implementing it in our products in Q2, Q3, and by the end of the year, you'll see instant, free, moving, stable, tethered coins and not needing shit coins.

Sorry, one minute's up, Marty. I'm assuming it's not like the Omni layer stuff, because that requires a blockchain. No. No blockchain. We use Lightning-style channels, and so we've used the concept of channels that Lightning has, except state and peer-to-peer state, except it's settling to a ledger and the ledgers are these hypercores and so you have say you have tether and they issue tether in this you know database but it's a publicly distributed database right it's using hypercores in the dht if you have an account in tether you can you can lock your balance and you can make a new ledger and this is now your tether ledger and people can have an account in this

ledger and if you have this whole like tree of ledgers everywhere you can bridge them with using lightning style channels and so you can just basically hey i want to pay marty but marty's over in the finance ledger with this tether and i'm in the fdx ledger oh fuck me um and i want to pay marty and i say i open a channel with you and we have a state together but it's like a disposable channel i can i can keep it open and we can go back and forth or i can just send you one payment and close it there's no like settlement on chain or kind of thing and it uses the same punishment transaction kind of concept to where if you try to misrepresent the state of our channel i can punish you and report it to the ledger and say hey this i have a proof that mario's cheating

and then i you get your punishment i get your money um and so it's just a way of saying hey credit stable coins ious any type of iou uh whether you want them to be coffee tokens a month of netflix tokens uh steel inside of or gold inside of world of warcraft whatever it doesn't matter um you can have them issued but they're all centrally issued anyway and so if it's centrally issued the only quality that you're getting by putting these tokens on a blockchain is simply this bearer right this digital bearer right so when i give it to you it's not mine anymore if that's all we needed to recreate and we can figure it out we're pretty sure we need to audit it and everything to make sure it's safe but we're pretty sure we figured out a way to do this

without a blockchain at all because again these hypercore you know these ledgers have integrity to them they can only be written to by keys they have a sequence to them that you can tell that you know the append log only so it's kind of like a blockchain like i mentioned earlier so you can get all the qualities you need out of a bear instrument without the blockchain aspect is it akin to like signet the ledger on hypercore where you have to sign to create a new block or i'm not familiar with signet honestly like we use reg test and test net and stuff and i only just started learning about those through developing the wallet i never actually used them hands-on i think signet is where you run your own blockchain right so that there might

be some similarities you produce blocks signatures yeah yeah yeah i don't know a lot about it to say But I'll say that, yeah, it has a blockchain-like structure so you can have this sequential integrity and you can have this cryptographic integrity because it's all written to by a key. And so you can recreate the use case, the isolated use case of trusted credit, of trusted amounts where they're just IOUs. And so we're not trying to make shit coins. We're not saying this is money. We're saying that businesses, you know, entities that want to be trusted can define these credits and have issue on their reputation and say, hey, you know, this is redeemable for one large coffee. And if you have this credit amount in your account, you can now take that and you can pass it to somebody else in any other pair credit ledger. Fascinating.

All right. Much longer than a minute. john it's always a pleasure sir we're sure to awesome to see you i'll have to visit austin again sometime i don't know if that will be anytime soon um but maybe i'll see you at a conference very anti-america these days right here yes i am i'm not gonna lie that's there are many americans i like but there is not a lot about america i like so i'll put it that way we need you back here we need to change it yeah well there's a whole world to change man that's true that's true you take care of austin i'll take care of

everything i touch it just won't be the u.s all right freaks go check out bitkit check out synonym slash tags hypercore whole punch paracredit paracredit Keith follow John on Twitter at Bitcoin Error Log

I feel like I've been following you for like eight nine years now one of the first followers on Twitter when your when your avatar

used to be like just the big exclamation point oh yeah that was the beginning awesome I had a different name back then too

I forget what that was we'll leave it for the audience to figure out go figure it out go on archive.com enjoy this rip peace and love freaks