TFTC: A Bitcoin Podcast - #441: Miniscript and Bitcoin Risk Products with Rob Hamilton

Episode Date: August 24, 2023

Marty sits down with Rob Hamilton to discuss Anchorwatch and keeping focus on Miniscript and maximizing its potential. Rob on Twitter: https://twitter.com/Rob1Ham Anchorwatch: https://www.anchorwatch.com/about 5:30 - Ninja Launch 7:43 - Bluechecks 13:31 - Content models 18:18 - Drivechains and OP_VAULT 22:58 - Miniscript 27:07 - Stepping back on Miniscript 33:50 - Balancing complexity at Anchorwatch 36:17 - Bitcoin risk products 42:52 - Anchorwatch policy construction 47:15 - UX 51:58 - Impatience 55:17 - Get your hands dirty 59:31 - Edge cases 1:06:22 - MPC 1:18:54 - Upgrades with unknown unknowns 1:27:34 - Bullish 1:32:43 - Bitcoin in macro 1:39:59 - Urgency Shoutout to our sponsors: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Unchained⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠River⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠CrowdHealth⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Bitcoin Talent Co⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 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

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you've had a dynamic where money's become freer than free when you talk about a fed just gone nuts all all the central banks going nuts so it's all acting like safe haven i believe that in a world where central bankers are tripping over themselves to devalue their currency bitcoin wins in the world of fiat currencies bitcoin is the victor i mean That's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. Alright, we're live, Rob. We're here, we're talking.

We're missing good content. That's right, let's get right into it. We're talking contentious potential Bitcoin protocol changes here. Yeah, basically the future of Bitcoin. It's interesting because I've talked to, right before recording, we were talking about covenants and drive chains. and i've told paul this directly at tabconf last year i was like why don't you just launch it on litecoin it's precedent it was already done for segwit then you can already have people building

tools where if there's a world where it ever got activated people are hitting the ground running because an observation i have with taproot is that we're two years post taproot launch and we're just people are just starting to explore snore implementations of mpc and using tap scripts more complicated like scripting structures and it's like the protocol change happened and it's like you know the like peter will and you know andrew polster like these elite level protocol developers are so far out ahead that there's a huge gap between protocol developers and application level developers and it took time to get actual application level developers in a place where they felt comfortable to build these more intricate things so the question is then is like

you had two years like you know could could if taproot launched now as opposed to two years ago would have really meaningfully had an impact on anything and there are some people that got to it earlier but my point being is that if you're trying to do a large sweeping change like a drive chain um you're better like you you want to have the application ecosystem ready to actually use those tools so launch a signet with it launch it on litecoin and then you can actually point and say look at all these things that are happening and then people can make a decision if it wants to be brought into bitcoin and there's precedent with that segwit was first activated on litecoin right like we like instead of like you know like actually using litecoin as bitcoin's test net it's

like okay litecoin bricks and all the incentives get wonky bitcoin's still fine but you have something that's close enough in implementation to let people start building and tinkering with it yeah and you're i mean you're saying tapper it's two years in and hasn't had that much adoption i mean segwit six years in and they're still laggards yeah to adopt that yeah there's So a lot of, you know, there's a... One of them is on your shirt. And then also I want to call out here, as I was walking into the commons today,

I got KYC checked and Parker insisted I have to wear this blue check to be able to get on the podcast today. I didn't realize the commons had a KYC policy here. Shout out to BTC pins. We have a box of blue checks to verify all members of the Bitcoin commons. Fantastic.

BTC pins that make good pins. yeah i have the uh the false set so i have that and it's still sitting in the boxes i'm trying to find the right place to like display the pins so until then i keep it in the box are you uh are you mad at me for getting rid of my real blue check no it's okay um it seems to me now that we have myself and skylar um the design head at fetty are now kind of like the uh you know we're holding our own is kind of trying to be the dignified bitcoiners with our blue checks you know you know some bitcoiners are more equal than others and the blue checks just you know they're better people i'm just gonna say it i mean i do i do miss the reach i'm not getting

as many views oh yes it's weird it's everything bitcoin protocol developments like twitter to x are they going to be the everything app it's a very chaotic time it was a very interesting jujitsu too right like from elon positioning because originally before elon took over the blue check was seen as this like cultural status symbol that um our cultural elites had access to right it was the journalists and there was a class of haves and have-nots and then elon came in and he democratized in the sense of you can pay for it and you can verify your identity uh and then you know then started layering all of the kyc and the payments information on top of that and i was talking to matt about this when i was at the park last time that was kind of like the ingenious of

it he was kind of like able to judo the cultural narrative and made it seem like getting a blue check was this act of rebellion and also like pushing back against those people that were abusing their position of power for so long um i i ultimately viewed as i use twitter as a service and i enjoyed consuming the content and i like you know i want to i directionally support the system i know there's uh what was it now like the identity verification everything is coming down we'll we'll see how it all pans out yeah i was before elon even took over i was paying three bucks a month for twitter blue and it was because i'm a user for a decade yeah and i get a lot of value this podcast would not exist logan would not be sleeping in the corner i can't believe it

i got here and there's like a whole cot set up for him he's just he has a little camping set you know you get you have a can of like you have a wall of canned beans for him and you it it looks like there's a cuff around his ankle he's like a ball and chain he's not allowed to leave the room yeah no or he gets switched but well you already let car get away right you can't let the next one get away no but like twitter transition to x like i've got a lot of value out of that platform for a decade um more than the decade i joined 2011 so like 12 years the deprecation of tweet deck really like they destroyed that product it was a perfect product and need to know no updates they did that and then elon posturing like the everything app like i don't want a wechat in the u.s i don't

think one platform should have all that power yeah and then the new ceo she's definitely just going to start censoring people again yeah i saw that that was um things could be what was it i think she had like a little like little catchy saying of something like could be like legal but like a problem basically that there was awful but lawful awful but lawful that was it yeah and it just like oh this literally could have been any of the previous twitter people could have said that yeah right then you see there's like it seems like they're picking favorites with the payouts some people are getting i saw like laura loomer had like 80 bucks or something and it's like you could have just not paid her but to signal like you're getting so little um independent of your

perspective of her she definitely has a reach that would justify more and then i saw with elon removing putting out removing the block function i think that's because people block advertisers iblock advertisers i've had to block blue shoe it's like they're just like trying to put horny ads in front of me like i'm married oh no i've gotten those i don't have an erectile dysfunction like i'm just i'm just block yeah blue shoe and then like random mobile like like anime like checks and it's like no yeah not interested like just remove it and the problem is is that like if it comes up once in passing you won't notice it but like i used to work in digital like online advertising and there's this concept of frequency capping and the idea is that there's

a certain level of saturation you're going to have and you're not going to want to actually convert at a certain point so like show the ad three times in 24 hours or like but like it'll just be 100 of my feet until i block it and it's just like very basic like ad infrastructure that just makes it like a very poor user experience so i do blocking as well yeah yeah the um i think the payouts if they favor certain forms of like thread content and engagement hacking people get paid out more for doing that type of stuff and they create this environment of self-censorship that that really does not appease me well and there's now like anti-patterns that emerge like that where also people are just lifting other people's contents and screenshots and putting

out there because if they quote retweet then someone else is going to get the monetization but if i like totally cut out the middle and i put it out as an image then i get full of the credit right so it degrades the you're changing the game theory incentives of using the social media platform where it used to be twitter was a means to an end of like you know sign up for my newsletter sign up for my sub stack like subscribe to my youtube channel whatever it was my podcast and now it's you know twitter itself being the end has this very uh zero sum mentality when it comes to content distribution on the platform which is just overall like it actually diminishes the the quality of the experience yeah that's actually something we're working on some stuff at tftc

uh don't want to tease it too much i just want to get it out there at some point next month so be on the lookout for that but that's something i've really been diving into and thinking about um very hard this summer particularly is what is content distribution the monetization look like like um so i guess i will tease it but like zero hedge is a really good model where um tyler durham writes content they have a couple other writers that write under the pen name as well so they have original content on the site then they syndicate and backlink to original content creators which is good for distribution i don't know how they do it they've pulled some of my shit just put it up there i'm like oh like it's cool to see the bent on zero hedge

they didn't ask me they just scraped it they link back which for distribution purposes is good but then obviously zero hedge has all those shitty ads they're monetizing that yep and obviously they have their premium how they're monetizing as well but like how do we replicate that model but allow the contributors that you're the content creators that you're syndicating to participate in that monetization as well i do think bitcoin plays a role in that i actually just had an idea sitting here you could layer in value for value and so far as if i have a buddy and i refer like my referral link you can get a percentage like if i refer someone to the bent with my link it would like tie back to like my lightning pub key and then maybe whatever residual

would kick through and like be part of that referral that's me just sitting here in real time like using the lightning prisms for like part of that like distribution and incentivizing people to share content right and you're all it's value aligned because if no one clicks the link and no one pays then you don't get anything but if like it's a way to like monetize this syndication system where if you're redistribute like you can link that in there as a way to like have an alignment of outcome and incentives yeah and that's so that's sort of we're not going exactly down that road but um fuck it i'll just say it out loud i wasn't trying to bait you out but something like that where we employ like a zero hedge model with the syndication to increase

distribution for individual content creators that their own websites or sub stacks but then layering in value for value functionalities with lightning and then doing a rev split nice okay that comes in from those revenues on the site it makes sense right i mean uh especially with um twitter trying to insert itself as this central point trying to find other ways to route around that yeah makes sense yeah yeah and then like that's the other thing too like um just thinking about where we are in the cycle of content creation distribution and monetization like are people really happy with the sub stack model where they go and they subscribe to each individual creator and then pay a monthly fee to each of them. Right. Or would they rather get all that content aggregated

somewhere else and then pay a little bit per. It sounds like an interesting way you can turn this into with, um, Noster as well. Yeah. You start like making your, this is my, my, my thing with Noster is I have an Noster account and I think that like most of the use cases up to this point of like a Twitter clone is like I get it because it's a mental model other people can grok and they can start following and seeing like how you can take the experience imported over here for me like Nostra to be successful it's going to be like that's gonna be a very minority use case and one example I think offhand is like wallet coordination if you use Spectre and I use Sparrow we should be able to use Nostra as a way to coordinate output descriptors and PSPTs so like

I can request a signature from you and then you would get like a something to pop out here and then you could be able to coordinate and move all that stuff to me that's like it's a perfect use case for bitcoin and you can use this as a way to just like share this information and nostrils are just like the dumb pipes that are just into smart clients right like your wallet is the smart client your your domus your your um you know those are smart clients with dumb servers that are just like spitting out information i think that's a really interesting way to start thinking about using nostril and in this context with like social content like you subscribe to this feed and then the server's just pushing out the content but then your application's like doing the more

fancy curation based on your likes and interests yeah yeah didn't ben build something like that for the coordination of multi-sig did he oh i i've been um i've been talking about for a couple months hoping someone would build it so maybe he didn't might have built it um i could be wrong though he built some multi-sig coordination or maybe it was a coin join coordination thing oh it was coin join i think yeah he was doing coin join yeah yeah yeah but uh i think this world of like um it's just a model of like you should be able to use whatever user like whatever wallet user interface you prefer but if you're doing some sort of distributed custody we should be able to just you know use this as a coordination for all of the back-end stuff so i can have my

user experience you have your user experience and everyone's happy yeah um i do want to bring it back to the beginning of the conversation because i do think it's very topical number one but it is important like to talk about these protocol upgrades changes whatever you want to call them that are being discussed right now whether it's drive chains uh op ctv op volt uh apo um it's checks like from stack it's been floating around too cnsfs which is yeah but yes there's a lot of stuff floating around right now so in your mind with that list everything floating around what do you think is a top priority i mean top priority is who has actual code right so that's what kind of the drive chain stuff really started getting like extra turned around this

week and the conversation was that luke put out that pull request but it's a partial pull request it's not even like you couldn't even take that code and click go live to my understanding and actually have drive chains working so i think um francis pulio was saying this that basically like if you want to fork and change bitcoin write your bit bait your user activated software client and get people to talk about it because until then it's all just kind of hypothetical abstractions people should be able to look at the code and see exactly okay you want to make another change what exactly is the change and i think that's the first threshold and to my understanding right now um i think apo and uh ctv are the two that actually have like code ready to like roll i

don't think it's formally rolled into a bit bait like like rebase into the current version of bitcoin and like forking it in but the code's sitting there and i think that's the actual serious place people should start with conversations and that's actually like i think the most like whatever your independent opinions are for like drive chains around like game theory and changing of incentives and stuff the code isn't ready to go so what are we talking about yeah right like like if i can't actually activate the drive like there isn't if the code doesn't exist and i can't play with it right now then like you're way premature in talking about let's upgrade the entire protocol to do this and i think to my understanding that was part of luke's role is

that paul contracted him to start writing this implementation and this is secondhand from people were talking about on twitter space paul wanted luke to get the initial code out there to get people to start talking about it so that's the actual way if you actually want to make a change um i know i didn't really directly answer your question on like what interests me i think ctv op vault are the things that i immediately look to um apo i know and this is also i guess is part of my bias is being i call myself a proud layer one boomer like i just i'm i'm i use lightning i have my own lightning node i play around with it but like i'm definitely more focused on a day-to-day basis on layer one bitcoin and ctv i just think has such massive and like op vault like this idea

of making more intelligent custody solutions if it just drastically changes from a scaling perspective and being able to have ways you can have trusted like like like trustless like more like aggregating of utxo so more people can like co-own a utxo and for just like from a self sovereignty custody perspective the idea that i can like commit this address can only go to a certain address or like ob vault like those are the massive step functions and like james o'brien calls it proactive versus reactive security all bitcoin security today is you set up all of like your traps and your draw bridges and everything and then you hope no one gets in but if someone gets in the money's gone and ob vault is explicitly reactive and i think that's a really powerful

paradigm shift when it talks about custody whether you're a business or you're an individual and i think it and that's why it's a great use case because it serves everyone that uses bitcoin yeah i mean i think james's positioning of op vault as a potential upgrade that can make exchanges it's exchange hacks the thing of the past is extremely powerful yeah um exchange hacks and five dollar wrench attacks things that like okay you move the money but it sits here for two weeks like it doesn't make it impossible for something to happen um but it definitely makes it much increases the cost and additionally you can have um a you can have a watch part watch tower service so you can like have a op vault like transaction and let's say all of a sudden you try to spend

your entire life savings out of your vault and you work with me as like a partner even if you are getting like five dollar wrench attack or something like and you don't get a whole like i can pull the switch and just like sweep it to your emergency cold storage in that sense you still have to figure out okay without vault you have an address you take it to like a staging area and you wait for the time lock and then you can send it to where you were trying to or you can pull the emergency switch and go to like a different cold storage you still need to consider how you're going to secure those funds right in that like emergency cold storage but it does it it makes these things um infinitesimal risks as opposed to like very real visceral risks that have existed

throughout the 15 years of bitcoin's existence so far absolutely um but that gets to another point which is like something that you've really been beating the drum and i really like your framing around this subject which is it's maybe not russian all this stuff maybe let's just play around with things we have like miniscript obviously you're building yeah a company around this primitive and um it hasn't been uh too well explored yet obviously you guys liana are playing around with it others are beginning to play around with it yeah and like in your mind like diving into that idea of all right let's play around with what we have and and see like if that's good enough and then do we need this other stuff yeah make that decision

down the line and for us like it's also from a enterprise of risk perspective of running a company um i guess you you could compare it to like paul at layer two labs where the entire premise of the company is this a soft fork has to exist right you need to make an upgrade change um while things like op vault off ctv would make what we're offering at anchor watch a better solution we can't live in the world of like and all we need to do is just get a soft fork into Bitcoin, right? Like that's way too much risk. So we're in a much better position of just working within Miniscript. And what's great about it is that it just uses the existing tools that Bitcoin has. And it's something that I think is massively underexplored. And the fact that Liana, the Liana

team, like Kevin, Antoine, Edouard, like we're working on this for like a year and there was really no one else. I think really, and, and the signing devices are finally starting to come online with it, which is another major step function. Cause it was working and ready to go, but then you had to use a hot you'd use your computer right it didn't have hardware wallet support so getting the hardware wallets and just uh this morning uh on my way over here uh the bitbox02 just announced support for it okay right so the bit so we have the bitbox02 we have the ledger we have the cold card mk4 on their edge firmware and the specter diy is it supported in hwi at all uh no the wizard sardine guys are working on hwi specifically okay um so

So, uh, how would I say this? Uh, so for the bit box, so what, the way we're integrating everything right now is like through the web app. So, uh, ledger has a JavaScript library. You can plug in cold cards. Great. Because it's just file upload because it just uses output descriptors and PSBTs. You just like drag drop file where they're using micro SD or plugging into the computer. Um, the specter DIY uses QR codes. So we have that all fully rocking loaded and running and the bit box. So two guys have, uh, they've wrote everything in rust and then they have bindings into javascript so it can all work in the web app but i think the next step and since the wizard sardine guys with liana it's a desktop wallet they need to have the hwi interfacing

so they've been working on it from that side but ultimately like this is just where it gets really exciting now is like being able to do more advanced custody solutions that don't require a fork making it accessible to the everyday user of bitcoin to have things like time locks without worrying about like i have to make a custom wallet and script that's going to be able access this bitcoin core just merged miniscript support for signing and reading well reading was back in january but signing support was like last month so now even if you wanted to use bitcoin cores your wallet you could even just use it there but you can also load as a watch only wallet which is great for if our servers go offline they cease to exist you can still port your wallet somewhere

and be able to access it right um so there's been a lot of movement this year and it gets really exciting just being able to have more advanced custody solutions and for like a regular user the idea of like i have a two or three multi-sig but if the funds haven't moved in two years it's a one of three multi-sig or it's a one of my three keys plus maybe like an emergency like friend for social recovery right i think the idea for us as a business we use it in the lens of multi-institutional custody but as a sovereign individual you could use it for social recovery too you can have friends that you trust that only if a certain amount of time passes you can be able to coordinate this stuff and i think it just it's sticking to the like making bitcoin programmable

money and many scripts makes bitcoin easier to access that programmability and because of that it makes bitcoin better money we can move beyond single sig and multi in like two or three three or five like multi-sig and you can do much more advanced constructions and it's been really fun to be building on top of those tools yeah and so let's take a step back for anybody who's listening to this and it's like what the hell are these guys talking about no i mean i mean i love getting into the weeds like this but i do think just for the appeasement of people who may be newer to these concepts i think we do like how does miniscript improve multisig is it even an improvement on multisig or is it something completely different um how are you guys

implementing it into anchor watch um and whether it's just pure custody or via your insurance products. Yeah. So I'll even take one further step back. What's Bitcoin script, right? Before you even talk about what many script is. So Bitcoin script is something that Satoshi invented with Bitcoin. It's the actual language that locks your Bitcoin on chain. So when you see an address, you have a locking script that maps to that address. And the very simple one, let's even, let's put Segway to Cypher seconds, like a public key hash. You have your public key, you hash it, and then you encode it into an address. And then when you go to spend, you present your public key and you present your signature and you verify you can unlock the funds

this gets expanded upon in multisig with op check multisig which is this is an op code right we talk about this in bitcoin for things when you're doing an upgrade to bitcoin and you're adding an op code you're saying i want to add a new way to use bitcoin as program like as a program function um there's 256 op codes uh about 110 of them are active satoshi right before he left the project deactivated a bunch of them because one of them created like a fatal loop yeah so i think like like opcat was one of them which i believe opcat which is concatenating two strings actually allows recursion so it allowed like all these weird things it also had op multiply divide there were all these crazy things you could do my favorite op code that got deactivated very

quickly was opver for op version so if you were running version 23 and i was running version 24 of Bitcoin, we would get different values, which is basically op hard fork because you like our addresses would map differently. It wouldn't make sense. Right. So, um, Satoshi, when he put all of these like op codes in there, um, definitely see the externalities. There was no idea of Nakamoto consensus yet. What are they even meant? Right. So you very quickly start when the system goes live, you realize like, well, wait a second, like we need to have uniformity of information. And that's part of the idea of soft forks is that you have things that are backwards compatible. so bitcoin script are all these crazy rules right that allow you to use bitcoin um for different

locking conditions and what miniscript does it says okay let's take like 20 of these like the core building blocks and treat them like lego bricks where you can kind of do more interesting custody solutions um there's three main tools um security tools let's call them that miniscript leverages. One, a Bitcoin signature, right? That's what we all use today. Then the next thing is a time lock. So a time lock, we've talked about like time locks got added into Bitcoin. It was actually the last forks before Segwit. There's two kinds of time locks. There is an absolute time lock and a relative time lock. An absolute time lock is, hey, I'm going to meet you at five o'clock tomorrow. A relative time lock is I'll meet you in eight hours, right? One's based on

the relative time of what it is right now. And one's based on a set fixed time in the future. And additionally, there's two ways you can do a time lock. You can either do a block height or you can actually do the timestamp. And this is something that, uh, as a, uh, like the, as a, as a fun thing to just think about the only piece of external information that exists in Bitcoin is the timestamp. The miners put into the block header, everything else within Bitcoin exists within the rules of Bitcoin. So you can use a time lock and you can actually say on July 1st, this happens, right?

or you can say a block height a million but you can't you can't do both you have to only pick you can only bring one clock to bitcoin script um so you have to be able to say am i gonna do a block height based thing or a calendar based thing and then the final tool so you have time locks you have signatures and then last one is a hash lock which we use in lightning for like hash time lock contracts but additionally like as a general mental model instead of a signature you have a you have like a pre-image so you have like a password or something that allows you to do or something. So that can allow you to do,

it does not solve the Oracle problem, but you can have Oracle's put things on chain. So a very simple example of this is like, we could have a bet where like, we think the Phillies are gonna win or lose, right? So you bet the Phillies are gonna win. I'm gonna bet the Phillies are gonna lose. And the way you would spend it would be like,

my signature plus the Oracle saying Phillies lose, and then I could pull the money out. Right, so you have to have an Oracle somewhere and it doesn't solve any of that, but it allows you to do this stuff. So Miniscript takes these three security tools plus and an or, and you can start clicking things in together

to do more interesting custody solutions. A practical example of what this looks like is one, a key hierarchy, right? So talking about like, is this, it's different than plain multisig, right? Because multisig, the way most people construct it, I view it as democracy for your money. And I think as a sovereign individual,

like as an individual use case, that makes sense. I have a two of three, if I get majority of my keys, I can spend my money, I'm the only stakeholder. That may get more complicated in a corporate governance setting, right? Maybe, and how we kind of think about this is the idea of a key hierarchy. So let's say, for example, it's a two or three multisig,

but Marty, it's your money, and you just give me a key and you give Logan a key. Your concern though, if it's a regular two or three multisig is that Logan and I are gonna go run off with your money. With a key hierarchy, it could be your key must sign plus either myself or Logan, right? So there's no way the two of us can run off with the money. You have seniority because it's your money, right?

And this is the idea, you can start thinking about this in a corporate governance setting. Maybe you wanna have a board of directors sign off plus one of the executive team, right? So this allows you to do this on-chain governance for more complicated custody. Inevitably, the follow-up question is,

cool, so my key must sign. Why does it have to get hit by a bus? Well, that's where a time lock comes in. You can say, after a certain amount of time, another spending path becomes available where your key is no longer required. And this is where we were thinking about this with multi-institutional custody.

It gets really interesting because maybe in a two of three where this one key is held by another company, you can actually have it be your two of three as the customer plus R2 of three as a service, right? So we get to do risk distribution, not just from you versus another company, but within a company you can distribute that risk. So there isn't just one person with the key. And this is where it gets really exciting about more elaborative ways. And there's no one right way of doing it. It's very openly permissive and expressive and you can just, you know, do whatever you'd like. So that's a high level review of the

the tool set of what many script is and how it can allow you to do more interesting custody solutions. Yeah. And just building on that explanation, I guess you building out anchor watch and thinking about this, like how do you weigh the trade off of making something as simple as possible? Like how do you like sort of narrow it from making it just simple enough

and not too complex. Yes. So I've been championing this idea of templates in that. um so we have a developer tool that allows you to make all these crazy custom scripts and we have fun with that just to kind of like make sure all of the from a website interface standpoint everything works and there's no unexpected issues but for mass adoption you don't want to have someone walking in and just be like i'm going to make a custom vault today because what's going to happen is they'll time lock their money for 100 years and be like hey like what happened and be

like i can't there's no refunds like once the money gets confirmed on chain i can't i can't change the rules of how time locks work to get your money unlocked right so the idea of a template though i think is a great way to streamline this and the perfect example earlier i talked about was this idea of a two of three decaying multi-sig where maybe it's two of three but if a year goes by and the money hasn't moved you can have it you can have one key be required right and that's the cool thing with like a relative time lock it's like a dead man switch because the timer starts once funds get deposited on chain so as long as you're alive and everything's well and you keep moving the money around once a year,

like you reset the time lock. But if something were to happen, you're able to use that as a way to like emergency recover the money. So templates are really great because it streamlines one, the mental load of a user, right? They just like, I'm using template A,

it's a two or three decay multi-sig. It streamlines the hardware wallets. They don't have to show as much information if they know it's within this constrained template. And they also know they can protect users to make sure they're not setting up an arbitrary multi-sig that's locking their money for a hundred years. um, it streamlines the other wallets that can talk to each other to make sure that everyone

like, Oh, you're using template a cool. We know we like to visualize templates like this. And then every person can have their own take on how they visualize it. And then also for on-chain, um, privacy, um, if more people are using the same kind of template, you kind of blend in a larger crowd. If you, you can make a really crazy random, like multi-sig, but when you go to spend, you have to reveal that. And it's a very unique footprint, right? So those, that's how we kind of think about it is using templates as a way to, uh, streamline the mental load. So people can have safe confidence right and also having people security audit those templates right so then you know that there isn't some weird unexpected bug that could possibly have an unintended spend

consequence yeah no it's very exciting it's going back to like the op vault example like just that peace of mind knowing like all right i have fail safes yes okay something messes up somebody dies somebody loses the key absolutely like this is going to be massive and then on top of that like you can add value added services like insurance products yeah and then what does that unlock for bitcoiners companies like having that ability to insure funds yeah so this is uh on the insurance piece it's really interesting so we we founded the company in march of last year and since then we've had prime trust ftx celsius voyage all these like all these companies have gone kaput and belly up, right? And for us, it was this baseline premise that as Bitcoin continues to

mature as an asset, and if it continues, if it's on the trajectory, you and I both think of it being world's reserve currency, there's going to be a risk market that develops around it, just like any other asset. You can get insurance on your home, you can get insurance on your car, how you're going to want to have insurance on your Bitcoin, because unless you're deep in the weeds, and even even if you are like very deeply technical and you're able to construct and you feel comfortable with how your custody is at the end of the day like you want to be able to go to sleep at night and know that everything's okay and the idea of insurance has been around for hundreds of years um it's kind of what really kicked off like um the america america because that's how all the

ships got underwritten to actually do all of the exploring because until then you would have a merchant who would put their entire life savings in the boat and if the boat sank they'd be done whereas with insurance they'd be able to take risks and not totally get destroyed in the event that something went to go wrong right so um the idea of having insurance for bitcoin in a way for being able to provide custody a sense of safety where if you choose to get exposure to bitcoin you're already accepting the volatility risk of the price the last thing you also want to take on top of that is key man risk where what if i mess something up and i lose my money and we've had a lot of conversations with people who maybe invest in bitcoin companies or

like they hold gptc but they can't self-custody because they they can't from either their family office or their fiduciaries or trust whatever it is they can't actually directly hold the coins themselves because they can't they have to worry about this governance problem of you don't want to have like sailor is not sitting with a ledger in his desk at his house with all of the bitcoin for micro strategy right and it's a very suboptimal way of thinking about how bitcoin should be custody. And additionally, it emerges this anti-pattern where everyone keeps their money at the same three custodians, right? So being able to sufficiently distribute the risk of not all of the keys sitting at one place, but additionally having the keys sharded in a way

with like leveraging Miniscript, but having this distribution of risk of where the keys are located brings more resilience to the network at large because you don't have to have a sole focal choke point. Like if you use a Coinbase or you use a BitGo, like the keys are sitting there. Yeah. And that's it. So, um, they, they, they both have insurance products, but the insurance coverage is an aggregate per incident limit. So if they hold a lot, you know, they don't have dollar for dollar denomination for your coins specifically. Right. So this idea of being able to have you as the named insured on an insurance policy, so you can feel confident that you have a, like you have a recourse in the event, something were to go wrong and you're not

standing in line for claims if something were to go wrong um and it just allows people to take that be able to take that leap and get exposure to bitcoin and also be able to have this like distribution uh ability to go to sleep at night right being able to have that peace of mind so that's kind of like our lens and our take on it and miniscript was the really big unlock for being able to encode this governance in a sufficient way for enterprise amounts of money right like talking about underwriting 10 million dollars of bitcoin in a vault a two or three multi-sig right we can go back to before like maybe the customer like they could either collude or there's a crime incident that happens but the idea like for what we're building at anchor watch

uh we call it a while our coordinator we call it trident right like a multi-pronged security is that even like we don't store any keys on the platform it's all hardware wallets but even if something like uh if if you lost all of your keys like someone came to your house and buy it all wrench and like took your stuff no funds have been lost yet on the on the same exact piece if someone were to massively compromise our keys, your keys are still required to sign for the length of the policy. And this is where it gets really interesting too, is leveraging these time locks where for as long as you're engaging in a service with us and we're providing value to you and we are holding risk, we are a required signer at anchor watch. But if you don't want to work

with us anymore, after the insurance policy expires, we can use a calendar time lock. It goes back to just being your keys again, right? So it's having this fair alignment of incentives compared to using a custodian. You're like, oh, custodian, I don't want to work with you anymore. Can I get my money back? And you're, is the person on the other end, a prime trust or an FTX or Celsius, right? Like this idea of being able to use Bitcoin as this programmable money to have this handoff of once the contract expires and you're not working with us anymore, it's actually easier for us to let you just take your own money out. Cause it's less operational overhead in our piece. You don't have to, we don't have to like process a withdrawal for you. It's your

keys. Go spend them. Yeah. Yeah. And so to dive into this, like to explain it more granularly, like when the insurance policy is up via many scripts, the sort of multi-sig setup decays and you don't need an anchor watch key to sign to move the Bitcoin. That's exactly right. Yeah. So for the length of the policy, we are required to sign, but after the policy expires, it goes back to you. Yeah. Yeah. And that's just, and you can verify this yourself. This was a really big unlock when Bitcoin core added this is that you could load the wallet yourself if you wanted to, right. You could go look, take the output descriptor. You can load it into core, verify the deposit addresses right and when i'm not trying to like hoodwink you into giving me

money personally you can independently verify this and you could hire your own experts if you wanted to to go through and be like okay yep it does at this calendar date it's just your keys and you can sign and we also can have contingency plans where if you had a catastrophic event where your office and your home like all burned down like there's a massive like natural disaster we can have contingency situations where it's us plus a third party that can come in and help recover the funds for you as well and and like indemnify you and make sure you can get your bitcoin back right it allows this to have this way of not viewing custody on a binary it's more of a spectrum and now you're adding time as a variable into the custody like is it right now

or is it a year from now and the coins don't have to move on chain it's all just programmed into the script yeah and then diving deeper into like the policy construction like what if somebody was to approach anchor watch like i need to insure my bitcoin what does that process look like yeah so uh we're gonna have the quote process live later this year we're launching first with just getting the tech demo next week should be live out there for anyone to go in and start messing with their cold card their specter diy or their ledger to actually use this themselves and see what the user flow looks like and help us give feedback but specifically for insurance it'd be underwriting just like it would be for any other insurance product right so um people have asked me this is

a kyc product if you're signing a financial contract we can't do a financial contract with a pseudonym uh because if there was recourse you can't go to court as a pseudonym right so this is a regulated legal financial contract and insurance is probably second most regulated industry behind banking but you'd go through an underwriting process like you would for a home or a car where we would understand okay this is how much bitcoin you have this is you know um how it's currently custodied like you're gonna have key holders on your side who are those key holders understanding that kind of clicking it in um and assuming we go through underwriting everything's approved uh we would uh walk you through set up a vault deposit funds funds are there and then

you'd be able to log into your dashboard and be able to look at see your funds are sitting there we also added additional functionality for like audit logs so you can see anyone in the vault who's like you can give someone view only access so maybe you have a lawyer or someone you want to have to be able to look at the funds but they're not going to hold the key themselves they're not spending anything. You can add them as a viewer, right? From the interfacing side, you can see who's proposed transactions. When you do a spend, we can actually show you also who signed, right? So on your side, you have maybe three keys. We'd be like, oh, it's key two and three that signed for you, right? And those are things that anyone could do today if you have the information. It's

just, I was surprised that no one had really done that yet where you can see specifically which key signed. So on the insurance side, we're trying to streamline as much as possible to be like a traditional insurance product where you go through underwriting, you sign everything up, and then we have the tech intersect with it to actually deposit and secure the funds. And then you're off to the races, pay your premium and then move on. Yeah. What does this unlock? Do you think obviously the family offices, high net worth individuals gives them more comfort, but more broadly beyond that. So for me, I think it actually provides peace of mind for anyone who wants Bitcoin exposure to understand that it's actually safe. There's actually a big

misunderstanding. Most people think that their funds are sitting at an exchange, that there's some sort of insurance just like people think the dollar's backed by gold and it's you know it's really not they think the fdic covers this stuff and it's not the case so for me i view it as it removes the mental burden for getting exposure to bitcoin because you don't have to worry about what if i get hacked and then additionally you have this um it also enforces better governance in the industry right this idea of um this idea of insured duties like when insurance started um in the 15s and 1600s it was guilds of merchants skilled merchants who understood the best practices in the industry and they enforced that on anyone who was going to get

insurance from them it was um the lex it's in latin but the term was like the merchant manual and it was like this big thick book and had all of like you know if there's storms if there's this there's that and that's we get to kind of push forward that governance and best practices to people who are using bitcoin so it removes a lot of the mental load of how do i secure my funds like well this is like for people who think that like self-custody be complicated we just said like here's like the instructions do it this way and if you follow these terms like this is part of your insurance and it removes the mental load of actually getting insurance to be like to getting exposure to bitcoin in self-custody we kind of like provide as a curated experience that bundles

in with the insurance and if something were to go wrong you're insured right so that just it removes all of that mental friction and like all the anxiety um for you and i who've been in this industry for like a decade, right? Like these are things that are like, they become second, like it's the water we swim in, but for each incremental person who's looking to get adoption to Bitcoin, they're not going to be as technically competent as you and I. And we want to be able to make it as easy as possible for them to say yes and get exposure. And, and if you have a custodian or some sort of aggregator who's managing these services, you can have confidence that they're following best practices. And it's not just a Sam Bankman free with a ledger in his desk,

moving funds around. Well, it's funny. You just said that. And that makes me think like, is this current crop of Bitcoiners going to be the most technically competent crop of Bitcoiners that ever exists? Like, will the UX around interacting with Bitcoin get to such a point that you don't even need to understand any of this? It's a really interesting, having been building this wallet now for, uh, we started working on Trident, uh, in full swing in like January, it was around November. I was having a conversation from our buddy Vic at CoinKite about mini scripts specifically that really like turn the light bulb on for me the real pain point is the ux because you have this really delicate walk you need to do where if you abstract details

away you then disempower users to understand what's going on so it's a very tight line to walk i think this this current generation would be most technical because we kind of had to build of the tools right we had to understand this stuff at first principles um now they're as an aggregate class of users i would say that's probably the case because i mean when i first started to be a coin it was paper wallets so you know like like the friction like this is back in like 2013 i started going to the new york city bit devs meetup and like that was your best option armory came out a couple years later right and that was still like running air gap computers and everything hardware while it's got more proliferated which made it much easier to

understand this stuff so to answer your question yeah i think just by the nature of like we had to like build the stick to like make the spear right like we're like we're cutting down fire like we're like cavemen you have to kind of at first principles really grok this stuff um so yeah and that's it's probably a good thing insofar as it not everyone like we i'm a big believer that bitcoin is a tool it's a means to an end it's not the end itself and we i think it's our job as the early adopters here to make it so that people can just live their lives and enjoy their, enjoy their work, enjoy their families and enjoy life and just know that the money problem solved and it works. Right. So like it's on us to kind of shoulder that burden and make it easier from

a user experience standpoint. So then more people can just use Bitcoin as a tool to live a better life. And then Bitcoin doesn't have to be their life to get too super deep in the technical weeds because that doesn't scale. No, no. I mean, that's one of the biggest knocks of Bitcoin. and you talk to anybody trying to convince them, like, hey, this is something you should probably be paying attention to. They're like, it's too technical. Nobody's ever going to use it. Yep.

It's like a UX will improve. The UX will improve. Yeah. And that's, yeah, it's fun, but it's hard. Like it is like having now, and just like talking about one of your earlier questions around was like, how are we building this? We use Bitcoin DevKit.

Bitcoin DevKit, BDK, and shout out to Alicos, Steve Myers, Thunder Biscuit, Daniela. like Matt now who joined the team with the recent spiral grant, like they, it's a very powerful Swiss army knife that lets us do all of this stuff. So the actual hard part is the UX. Like you have to be careful and thoughtful in how you're constructing your APIs and making sure you're not doing silly things and whatnot,

but the tools are coming out of the box and it works. And it's a really powerful primitive to do. Like all of this mini script stuff is just out of the box works. It's built in natively in rust. So it's built on top of Rust Bitcoin and Rust Miniscript, the both libraries that Andrew Pulser maintains. And it allows for you to, for us,

it's actually like talking about this, like abstracting things. I don't have to go and write elliptic curve cryptography. And like, we get to just sit on top, stand on the shoulders of Andrew Pulser to be able to actually work on the application piece. So here I am talking about like, oh, you know, it's our burden to figure it out. Like

stand on the shoulder of giants. Like Andrew's the one who like wrote all of this code, like and built all of these things so that I don't have to start at square zero i can just start with the working tools to then make the user experience that i want to need from to service my customers so yeah like it's it's a it's been it's been a really great experience and uh also the foreign language bindings down the line like adding a mobile app much easier because you can just take i have all the instructions and just port it over to kotlin or swift and so you can just have an android or ios app out of the box that's like

i think it's a lot of the credit you can look at what the mutiny guys did they built it as a web like the you know the web app the progressive web app and then they just like oh flip a switch okay it's android because they had all of the tools sitting there so like i'm not i'm trivializing it a little bit but like they didn't have to re-architect their code all over again to make it work in a mobile app and that's a really it's just an incredible tool i can't can't thank them highly enough and like just sing their praises because it's a real superpower and that's why we're a very small team um it's myself we have one other full-time engineer and one person we're looking to bring on soon but like it's and we're able to build this entire experience and like have

high confidence that all the bitcoiny stuff works it's pretty crazy yeah and i mean it speaks to one of my largest frustrations in the space which is not in the space but like critics of bitcoin it's just their impatience like to you gotta crawl before you walk before you run before you fly and you need all these foundational toolkits to be able to do all this and it's getting to a point at the protocol layer and i think even at the lightning layer where that tooling to to build on top of to build the application layers on top of the protocols is hitting a point of maturation where things are going to get really exciting absolutely there's lightning dev kit right and that's it's just everything i just said about layer one bitcoin for bdk there's also ldk for

lightning dev kit and that's just it's a massive force multiplier where um it allows people to experiment more freely i think they can take more shots on goal because they don't have to start from scratch every time and it's a really and um rodolfo's really big on this is like you just want to have like like have the gray beards like a steve myers just like maintaining the core tools and let everyone else go run off so you're not building everything from scratch it's a much more scalable approach and i think that's gets really exciting of having empowering more developers to build these applications that can actually service end customers and this is something where if three years ago i wanted to try and do this like there was initial reference miniscript code floating

around it would have been a huge hassle to try and like write wrappers for all this stuff but now it just comes out of the box yeah and that's where like it is like there's a bit of an inflection point in the developer ecosystem to make this stuff more accessible and i expect to see that compounding continue are you saying like all the developers aren't at ethereum anymore i was actually at pleb lab yesterday and there was a bunch of guys that came over from solana that are now building on lightning really yeah i was briefly chatting with them um yeah so apparently they they were really big on solana for payments and then they discovered lightning and now they're working on a pleb lab and like building stuff was that was one of those guys

on stacker news this week maybe um it was a stacker news post where uh some guy was like solana i got completely jaded by it and then found lightning it sounds that sounds like him yeah what like what did you draw out of that conversation um it was very brief in passing but just this understanding of um i think these bear markets where you know bitcoin you know gets sick but then everyone else dies right like in the sense that people can get this fleet like there's like this fleeting fomo sense of like i'm building on bleeding edge technology and there is something to be said about the reliability of bitcoin and that there is a foundational base here of real organic transactional value that's being built here. Um, I think, I think it's

built like it's, it's building a cathedral brick by brick. Yeah. And the fact that it continues to exist, um, there's definitely things to optimize. We were talking about upgrades before. I know APO is very big among the lightning proponents because of LN symmetry and it streamlines a lot of things, um, makes lightning more scalable, makes lightning more scalable it also enables other things like i think people have found ways to construct basically drive chains using apo right um and that's just part of the value the trade-off conversation of like the features that get added um all this to say it it's a really exciting time to be building and like this is my first time in bitcoin so i've been in bitcoin since like i mentioned earlier

2013 this is my first time actually as a full-time career during a bear market working on it and i wake up every morning and just like full just like sprint ahead and like so many things to do and the price is really like secondary but also you just realize like there's so much to do there's so much to be building um and i would encourage anyone who's listening um even if you're not super technical you don't have to start out super technical just um find something that really interests you and start pushing forward and that's what's talking like with um our buddy american hodl um i started talking about the manuscript he's like why is no one else done this and then i was talking to pete rizzo uh in miami and he looked he walked up there i was showing him the

demo he's like why are you the first one that's like doing all this stuff i was like no there's like the wizard sardine guys he's like no but like but no one like why is no one talking about the manuscript and the scripting stuff i was like i don't know he's like you found an opportunity and started building on it right and now people are adding hardware wallet support and all this to say don't assume that someone else is building what you think should be done you need to get your hands dirty get in there scratch your own itch and like find these opportunities because now like miniscripts are totally fully open source tool and what i'm really hoping for is um the work that i'm doing and the work that the wizard sardine guys are doing and streamlining this adoption

the next incremental person who wants to build on this stuff has so many more things knocked down like you're gonna already have five hardware wallets out of the box whereas like in december last year i was flashing custom firmware on my ledger to do any testing but now it just works so like making it like pushing these things down so someone else can just stand on my shoulders and do something that's super accessible and easy and making their own applications right like that's the dream and just giving back and brick by brick building that cathedral and like it's a really rewarding experience so far yeah i mean you guys are crushing it like something like getting like templates standardized across hardware wallets and giving that to people to

build on yeah that could be massive no i think i think it'd be incredible and providing a way for people to start suggesting and promoting their own templates and just getting things in there um it's really exciting because like i think that it's just totally been overlooked this idea of bitcoin being used as programmable money and all of the great things miniscript does to standardize not in the template side but like it just abstracts away a lot of problems you don't have to worry about constructing custom witnesses to spend your money like it all just works and And it's a really powerful idea that you can draw something on a board, you get a string of texts, you can, you can look at it and reason about what you want and you hit a button

and it becomes Bitcoin script. It's like a super power. Yeah. And I'm extremely happy that you guys, the wizard sardine team are building on this because it does validate going back to like, we're building cathedrals and I get impatient with the people who are impatient with the, with the speed of development with Bitcoin, you are validating what has been a long-term thesis for me which is like yes you can go do robust scripting on ethereum solana whatever it be but they're working on structurally unsound foundations

where we're going to try and do it right over here in bitcoin it's going to take longer but the long-term effects are going to be profound absolutely how valuable the network is overall yeah um andrew had this uh andrew pulcher had this point that um a lot of the things we tease Ethereum about having this like intractable complicated programming language actually could be applied to Bitcoin before Miniscript. Because if you were like by hand, I'm going to do that. Like to write a Bitcoin custom contract script by hand is not an easy thing, unless you're a wizard or a super test net and someone who like lives for those little details. Like it's not something most people can just do out of the box. And what I call the Miniscript is bowling with

bumpers. If you, if you, if you, if you use Miniscript, you're not going to throw a gutter ball. You're not going to have an impossible spend condition with your money. You may lose keys, but you're not going to have a way where you brick your money the moment it gets deposited. And that's, it solves that problem now. So you can actually think about Bitcoin and with a more reasonable perspective.

And you can, you know, we, we, we can now actually laugh at like, Oh, you had a bug in your solidity contract. Right.

It's like, like, because before, like it's like, okay, you try and do this custom by hand in Bitcoin. You could easily brick yourself as well. So it's really exciting for sure.

Yeah. Let's talk edge cases. Yeah. When I'm thinking like with absolute time locks, where you hit like a date in the future yeah what happens if 75 of the hash rate falls off the network and the block isn't produced on that date like how does that affect insurance policies or anything like that so let's talk about this so the way um it's bip 113 is the um method in which it's called the mean time pass so how the bitcoin network keeps track of um network time is there's

there's a couple of conditions. One, your node locally will reject any block that comes in that is further than two hours ahead of your local time on your node, right? And this is like an idea of a time warp attack, right? Like minor start colluding. Shout out to Jameson Lopp has a really great blog post. I tweeted it out a couple of weeks ago. I'll have to go find it again. But he had a really great blog post specifically around timestamps and how they're being maintained in the network so um all this to say so if you go two hours and forward in the future your node will reject it the bitcoin network though requires that a miner when they put forward a time stamp into a block header for it to be network valid has to be ahead of the median time stamp of the

past 11 blocks so you can actually look on mempool.space and you start clicking through you'll see all of a sudden like oh this block was found at 701 and then the next block will be oh was found at 659 because time's fuzzy in that sense and also the time stamp is something the miners will cycle through to get more guesses on like their hashing right um so if you were to have miners were like 75 of the network stop so was your question 75 of the hash rate just blocks so you have absolute yeah you have a time stamp july 1st yep 2024 this policy's over june 30th 75 the hash rate falls off the network and a block is produced for two days so that's actually an easier thing to solve than the uh block height equivalent because the block height

equivalent if it's like if let's say it's at block height a million you're doing something it's like you've got nine nine nine hundred nine nine thousand nine hundred and fifty and the last fifty blocks take a really long time there's no way around that but the time stamp can leap forward right and the time stamp again is integral part of bitcoin security because it's how the difficulty adjustment works is it actually takes that actual clock time and says okay you know 21 40 blocks happened okay well how much time passed and it uses this like time approximation to understand that um unfortunately in that edge case the money's not lost the security hasn't been violated it just may take a longer to move it to move it which is definitely a much better

you know condition right so in that sense that's why the time standpoint is actually fine because once enough blocks eke out you know you would be able to say okay the median time passed now is july 1st you can move the money yeah yeah yeah and even in that case where policy is done july 1st a block isn't produced on july 1st the next one's on july 2nd you can then move those funds you're still beholden to block production anyway if you want to move those funds out right you're still waiting for a confirmed transaction anyway. And even in like a crazy edge case like that, it's not like we would be like,

well, well, sucks to be you wait for your money. Like we could, we could still sign and go to the higher level branch and still execute a signature for them. Right. It would be only in a sense where if we went fully adversarial for whatever

reason, you would be beholden to waiting for the time blocks to move the time lock to expire. And this is a funny thing. Like, so the language we use in Bitcoin from a UX perspective is interesting because it's really not a time lock. um it's a time unlock because you don't um and the shout out to my co-founder becca who

a really great asset she has is she did not get into bitcoin until 2019 so i'm like like talking like a mile a minute like all the things she's like that doesn't make sense like time lock and she's like oh so like after this amount of time you lock this and it's like no longer spendable like no a new path opens up she's like so it's a time unlock like yeah no you're technically right like so if you have like um you have this like big complicated security layer and then a certain amount of time passes and then it's like you can move the money yourself it's a time unlock because after a certain amount of time time unlocks a new way to spend the money but we call it time locks in bitcoin right so like there's like the old this like language semantic things that like

um for you're trying to communicate to a wider scale audience you need to think about like the internal jargon we use versus what is actually something that maybe is more naturally intuitive for a larger population yeah yeah the alternative like time lock you're locking it up for time in the future so like the lock happens on the front end right but you can also flip that and be like it's a time unlock on the back end i think that's exactly it right because like this condition is locked until a certain amount of time passes but if you're thinking about it sequentially you're like okay oh so that first layer i no longer can spend from that layer i was like no you can still spend from the first layer she's like okay well then nothing is getting

locked then the future spend path is locked until a certain amount of time passes um and this is because it's like going through like the initial reasoning this is another ux thing um where you have to pick what layer you're spending from now it's not just i spend the money you need to say okay well are you spending from layer one two three because you need to construct your psbt um relative to that and so and if you're using taproot we're talking about earlier like taproot adoption um if you're using um the script path and you have like basically all these tap leaves of different ways you can spend the money it's much better for privacy because instead of having this massive like script all in one block for a segwit output anybody can read anyone can read

your little on taproot you just have a little leaf so you just have exactly what you're spending to but the thing is is like let's say you want to spend from layer one but then you decide later you're going to spend from layer two when you're signing things in taproot you're committing to that little tap leaf so you actually need to re-kick off the signatures all over again right um so but this is part of the ux like you have to say like okay how do you plan on spending this money and we are like normalizing that in the ux flow um to streamline it for them to be like oh you need device one two and three to sign or if you want to do this layer you have to wait for this much time to pass and you can sign it now but it's like a post-dated check yeah right but

these are all things that were not any other wallet really hasn't had to worry about the ux around before so that's been a lot of becca's been really doing a great job spearheading that and trying to make it as reasonably approachable and understandable as possible for something that's really complicated to the point where but we're still empowering you just to understand what's going on because you can just wave your hand and be like oh like come back in three weeks or whatever it's like that's not really a it's your money it's not really a satisfying answer so trying to balance that information overload and making sure users have like informed consent and knowledge of how their money is being held it's a very tight line to walk in a way where

you don't have to have a nerd on staff to like reason it for you yeah yeah that gets into another thing it's not really an edge case it's actually just like an inherent um inherent uh thing you have to deal with is the activity like with miniscript once these things decay or like with your insurance policy if you want to re-up it you do have to move yes bitcoin and is this sort of where the battle between miniscript and mpc enters because what's the idea with mpc is that instead of having to move to bitcoin you could just change out keys you could rotate keys yeah so uh the infamous uh team script versus mpc gang twitter war so uh ryan dale's a good buddy so we uh i'll let everyone peek behind the curtain a little bit here we were we were mocking everyone

having stock to flow and price um fights so him and i decided that we should have a fight like an actual twitter drama fight that was about nerdy things and with the goal that maybe everyone will learn a little bit about bitcoin along the way um so uh the whole so it's really interesting with mpc and like huge shout out to jesse posner um working over at square um working on this for frost right um like round optimized like like threshold signatures using snore signatures um is this idea that you have a single public key on chain we're talking about bitcoin script earlier so like um multi-sig the way it works right now is like you do um three public keys device one two three and then op check multi-sig and then you provide your signatures the way it

works for frost though is you have one single public key on chain and what that actually is what you're doing off chain you have three devices that are coordinating signatures and it all aggregates to that one signature and this was a really great app upgrade with schnor a little context is schnor signatures were around when satoshi invented bitcoin but they had a patent on them so he had to use ecdsa and when the patent expired it was around the time of doing taproot they upgraded and added a new signature mechanism so that's why taproot is like four three different upgrades all rolled up into one um but schnor signatures make it really easy mathematically to have security proofs to understand that you're able to aggregate these signatures in a much more

streamlined way so um this is a really interesting point with npc is that let's say you me and logan again are in a two of three multi-sig and um you finally let cut the ball and chain free from logan logan runs out of the studio he's gone forever now we have a two of three right but uh you and i need to move the funds on chain because logan's public key is sitting on chain right so we need to move the money to a new vault right which is talking about like if you need to re-up your insurance policy you need to re-up it too because like the time stamps are hard-coded on chain you need to refresh the time stamps um with npc though we would have one aggregated public key of you me logan and you and i could regenerate a third share and give it to someone else that comes in

and we don't have to move the money on chain and like i think someone who's been putting a lot of thought into this and i think is thinking about it the right way is alex leishman at river is this concept of from an enterprise use case you have people who want to know that if i generate a deposit address and 10 years goes by i can still put money into that address and i'll have to worry about like oh that address is bricked prime trust ran into this problem exactly allegedly prime trust ran into this problem uh so the idea though is that you can have uh an enterprise like key and you can have these shards and you can over time rotate out the shards and you're able to actually transfer custody without having to actually move funds on chain and that's a really

interesting scalable approach too um it gets really interesting for like does that make utx as equivalent to like rhinestones at a certain in a certain way yeah because you're able to move everything off chain right so you can have company treasuries that actually rotate out custody without ever having to do an on-chain transaction now there are um there are things you need to consider right this isn't a silver bullet you need to worry about nonce generation um so basically a nonce is a number only used once and the way this works in traditional bitcoin today is there's a deterministic nonce scheme so if you have a transaction you know you'll get the same nonce every time and that's all of the harder wallets you know implement this to make sure that you're

not uh gonna flick on yourself um the problem is if you use the number if you the nonce is not only used once it's used multiple times you can actually reverse infer the private key to degrade the security of you actually ruin the security right like so like if if i get you to sign once i'm like oh you know what oh that i didn't mean to sign that sign this instead and you use the same private key and you use the nonce again but you're signing to a different transaction i can reverse engineer what your private key is it's basically a math equation i can say like you you hold things constant and you like you know equation you cross out both sides you get the private key um so nonce coordination is a really important element um when you're using

npc and additionally in this like you me logan example like you and i need to destroy our old shares because um you what in theory what would happen is like logan could come back and be like oh hey marty you have your old share story hey let's take the money and run right so like you have to make sure you're securely deleting your old shares and you have to make sure that you're not reusing nonsense and that's a big problem because how do you verify that you actually deleted it yep exactly it becomes a complicated thing in that sense um from like how do you prove negative like how do you prove you deleted something um so these are the things i think what was the was it nick uh working on the that frost hardware wallet i saw this on twitter the

other day nickler uh yeah nickler was it yeah he was working on this like it was like really cool uh like it almost looks like a raspberry pi zero but like you can click a bunch of things together and start generating shares like people are just like uh people are now starting to explore about what this design space looks like and that gets really exciting um over time huge shout out to bitcoin optech actually um another version of uh mpc is music music too so frost is interesting because it's a threshold right so it's a n of m music um it's just n of n right you have to have everyone present um but bitgo did a field report um brandon cole i think is his name uh reardon code on twitter he did a field report for bitcoin optech's latest newsletter where they were

leveraging Schnorr and MPC for music too, for the BitGo product. So it was customer key plus BitGo key only looks like a single SIG on chain. And this is where it gets really cool too, is that when you're using MPC, it only looks like a single SIG. You don't know that it's multiple signers because that's all done off chain. You do. And that's, that's, that's the trade-off is you do this all off chain. So it's smaller, more discreet, more private, but you have to then offload a bunch of things that you would do on chain off chain. And that's where the nonce coordination and the share generation everything kind of comes into play what they did though at bitco is they worked with sonket over at blockstream research and they were actually modifying adding proprietary fields

into the psbts to do this like this nonce generation and handoff so they were just using psbts and actually using music too within the bitco client so that gets really interesting that people are starting to like think of like fun ways to hack into a psbt the nonce coordination because now you can actually just take the same standard payload of a psbt it has some extra data in there and you can start doing a secure signing and everything. And it makes it much more scalable and adoptable to have people leveraging these tools. And you have that nonce validation that the nonce generation is done the right way. Yeah, that would be greater security. Exactly. That would be, I think those, those tools are yet to be fully seen and fleshed out, but that would be

the idea that you could use the PSBT and you can kind of check and be like, Hey, have I looked at this nonce before? Oh no, I haven't. Cool. So now your software wallet becomes more important because maybe it's doing extra checks to make sure you have, you're not reusing nonces. And it was really cool uh what bit goes doing is actually like the idea of the actual platonic ideal of the the silly uh the very serious very very serious debate between team script and uh mpc game if uh what they're doing is they um so taproot has a key path and a script path in ways you can spend the money so the key path is a single public key but it's a music aggregated key so that is BitGo plus the customer. And it looks like a single SIG. In the event, one of those keys

goes missing though, they have the script path and they have a Merkle root and they have a Merkle tree with the tap leaves. And then your backups are the backup key plus BitGo or the backup key plus the customer, if either BitGo or the customer go missing. And it's all contained in a single address. And that gets really interesting that you can have your default happy path, maybe that just looks like a single SIG. And then in the event, you need to go down some sort of contingency branch it's all in there and you're able to use both script more advanced scripting conditions and mpc to aggregate all these things down um it gets really exciting and then leveraging psbts to make it more interoperable i think it makes it a lower

threshold for say hardware wallets to start supporting this as well right because it's in a standard form factor everyone can you know expect and understand to use yeah and so outside the problems that could arise with the nonce generation not being done correctly but it seems like this pspd hack that it goes working on could prevent that yeah why does npc get a bad rap um obviously fireblocks is leveraging it is that implementation of npc um which secures bitcoin keys and shitcoin keys would that be different than this npc implementation you're describing yes that's a great observation so mpc um it gets a bad rap i think rightfully so because ecdsa mpc is a mess absolute mess um there was actually just um like you know there was a bunch

of like hacker conferences and a bunch of these implementations actually broken ecdsa is uh yeah ecdsa like like you just mentioned like recent months like there's some vulnerability there's been a bunch of breaks yeah there's been a bunch of breaks in ecdsa mpcs and the difference and so one, it gets a bad rap because it's from a custodian standpoint, like your fireblocks, they want to have one security solution that can secure your Cardano, your Bitcoin, your Litecoin, your Dogecoin and everything, right? Since it all uses ECDSA, it's a wrapper that can just do everything, right? So they use that from a streamlining user experience, I would say at the threat of security, right? Bitcoin script natively has the ability to do things like

multisig that things like ETH and other coins do not. So what they're able to do with MPC is provide a multi-sig like experience by using multi-party computing, MPC, and extra cryptography to unify the user experience. And it's strictly worse from a security trade-off perspective. The difference here is leveraging Taproot and Schnorr signatures has a much cleaner mathematical way of actually aggregating these keys and doing this distribution. Like you said, there's still the nonce generation problem. They're still making sure if you're rotating out stakeholders, you're securely deleting old shares but mathematically it's much cleaner and that's kind of like the really big thing is that um all of the very cynically people using ecdsa mpc

just to kind of like hack in multisig into all these other coins at the risk of the security of the actual like system um fun loss this year right yeah no yeah it's it's a real it's a real serious problem and that's where like snore signatures provide a better way of being able to offer the security um and it'll still take time there needs to be more tooling i was actually talking to uh jesse posner uh who's been working on frost for a while the next step level will be really cool um is getting a security proof that can actually wrap music and frost so you can have it let's say us you mean logan have a single sick as a mpc is a two of three and then let's say there's another company that has a two of three and then you have two our signature and their

signature aggregated and then mu sig toing it so it just looks like a single key so you can start collapsing everything to look like a single sig the security proof hasn't been done yet to show jesse was confident that it should be doable but if you start bundling in these different npc approaches you can just make every single signature look like a single a single sig and what's cool is that you can actually use like tap scripts and like have like different conditions and you only reveal the condition that you're going to use that makes it look like a single stick at the end of the day and that's where it gets like really exciting it's just aggregating all these things which is a better scaling solution because you're taking up less space

on chain um it's more private it's way more private um you're not able to directly reason about like how this money is being secured and then you're also going to do all this like off chain custody swapping too right like and this is like the next frontier and this these are all things that don't require a fork like going back to like all of these tools are just out there yeah and it just takes people to have the ambition to start like building on top of it well that's what like our last conversation in nashville really got me thinking and then i sat down with alex thorne he was asking me about like apo ctv drive chains and i think you convinced me it's like let's just play around with this and see how far we can go with miniscript frost music whatever

then if we get to the edges and we need more then let's have those conversations i think apo in my mind because i do think lightning needs to be more scalable like i in my mind my list priorities for all these up upgrades that's number one because i do think if we can unlock scalability at the lightning layer it's gonna be massive for adoption and usability um but when it comes to like robust scripting and vaults and covenants and all that like i think we should just play around with all the stuff you're describing first. Totally, yeah, and that's where I work in the field

in which I have agency to affect change. Right, like, I don't want to be defeatist if I think like obvult is a great idea, and it would actually be really complimentary to, we're building an anchor watch, we're going to provide better security assurances, and it's just better security from a reactive standpoint.

I have to work within things I have the agency to change. And Miniscript is something that I can do, and I don't have to ask for permission, right? So I can just build the tools. I can build the user experiences. I can provide a better service without being gated by things that are outside my power.

And so I try not to take a defeatist take on it, but it's just working within what I have the means to actually control. And then I can be laser focused on that. Yeah, and that's how I've been trying to track it and think of it and just building what I can and thinking about these hard problems and empowering users to leverage Bitcoin

in interesting ways that don't require a fork. And if those four conversations come, I'll review it when like the code is ready to go and there's like a bit big client and like when it's ready to actually start like talking actual details and activation and everything. Yeah, like I won't be passive, but until someone puts forward those kinds of things,

I can't invest myself into it. Yeah. Things will change. Like beyond that too, like I think there's a bit of scar tissue from the taproot upgrade, particularly like with ordinals. I think there were some unforeseen consequences of the combination of tap

root and Segwit that led to ordinals that many people think is wasting space on chain. Like I saw somebody say like their, their, their storage on their node balloon from like 5.2 to 7.3 gigabytes this summer for the UTXO set. Yeah. Yeah.

No, it's it's a, I can understand that people are reserved about making changes to Bitcoin, because there's always on you have just like you can't prove a negative like you deleted you can't prove the unknown unknowns yeah right so there's always going to be an unknown unknown with any change that happens to bitcoin and as bitcoin grows and you get more sensitive to like what are the things that could structurally change it's actually purely like happenstance that apo wasn't already part of the sig hash flags like there's usually an alternative universe

where like almost everything's identical and satoshi also added sig hash none right for apo and you know like there's like kind of this just echoes of like how bitcoin and everything develops from them the other option is you can actually and you can do um lightning network symmetry if you had ctv plus check sick from stack and check sick from stack is an op code that's actually live in liquid network so there's actually working written code but like this is where now people start going into fights of well i don't want apo because i can enable drive chain so let's do it this way and then like it's like really i guess really contentious and then it like it becomes like a political lobbying thing because everyone wants their upgrade in

um i am humble enough to understand bitcoin to a place where i i know more than most but i do not fully understand the implications of these deep protocol level changes that is something that is like i will have an opinion when those times when the times come but like i can't pretend that i have perfect knowledge of all this stuff that you know maybe 10 people in the world do yeah and that's i mean from my perspective too like whether it's on this show or rabbit hole recap i mean leading up to taproot like we were big cheerleaders and i think for good reason i think taproot's a net positive but totally did not understand the unknown unknowns and i think the lesson i've taken from that is like maybe i'm just more reserved in what i'm actually like championing from my

perspective because i can't fucking audit the code yeah i don't know these edge cases i can't do the cryptography like i do not know like what is good enough yeah and going back to the point like i think we should experiment with miniscript frost music push that as far as we can yeah and then if we need more like all right let's have the conversation then frost music was only possible because the taproot was short signatures right and like the more and using scriptly and using tap leaves is another taproot upgrade like that idea of like you have many many spend conditions nested within one single address so like we did get a lot of value unlocked and i'm ultimately of the position um it's funny a lot of people think i'm like super pro ordinals because i did

the what bitcoin did like the week after like i met i got to meet casey at bitcoin park i think he's a really great guy like i'm of a level of agnosticism of like bitcoin is a permissionless system and like if people putting jpegs really breaks your conception of how bitcoin will ever survive as global money then like i don't think that's a serious position like people are just going to do whatever they want to on chain this is echoes of what was happening with counter party so yeah like it's just going to happen and like i do think from a narrative perspective it did change the perspective of how people maybe outside the core community you and i roll in of viewing bitcoin as this asset to like put other protocols and chains like these brc20s and like

not using bitcoin as sound money but is this like the network model of bitcoin as a network and distributing things and ultimately like it makes transactions more expensive and i think the miners are all happy that they're getting economic activity so like you have to just kind of like live with like the the terms and just move on well that was like a short like hash price right now is six cents um fee revenue is nowhere near where it was in may i'm checking the block menples are not clearing again menples are not clearing and then you have the chain state bloating by two gigabytes over the yeah the utx set that's yeah um it's uh like it's definitely not ideal i would you know i think the bigger culprit i mean removing the script size limit is something

that definitely it's shocking that someone didn't look through that and realize wait a second we're removing the script size limit so what does that mean for arbitrary data all that said like i think it just ultimately like bitcoin i think i think bitcoin's able to transcend and move beyond this like i agree as well and like i get it like it's it's suboptimal um for how people view it but it's not the end of the world no not this time around but like that's my thinking is like all right we dodged a bullet yeah something like we keep doing these soft forks and upgrades and these unknown unknowns present themselves and compound um this type of activity like that's i guess that's where my thinking is coming from now it's like all right i'm sort of adopting like a steve

barber maybe we should ossify because do we fuck ourselves up by i'm doing this many times in the future like maybe we can get away with it this time but how many times can we get away with it before it degrades the ability to sufficiently distribute the network i got this mental model from jameson lopp of the idea that like ossification is a natural end state it's not a declared goal now like if bitcoin were to never upgrade again i'm i live my life and i make assumptions and decisions for myself and anchor watch as a company on that bitcoin will not upgrade again that is my default state assumption ossification is here that's and that's just as a pragmatic default and how i can kind of like plan and strategize over my life right i don't think

that's necessarily like i i'd love op vault like i'd love just a very simple just like clawback ability like if i have money it's sitting on chain being able to like have some means of being able to pull money back um i know up fault in the latest upgrades looks closer to just a generalized ctv now to my understanding i haven't looked at the code myself but um if i don't get that stuff i will still be here working on bitcoin and building things right like it's not going to be the end of the world for me so yeah that's how i try to view it yeah yeah these are heavy subjects though like it there's a way i mean and i'm sure it weighs like it weighs it's weighed on me um from the perspective of like we have this platform we're trying to educate people about

bitcoin with the taproot activation maybe obviously did not know the full ramifications with that no um script moving the script size moving the script size i cannot foresee that so i'm trying to humble myself and be like, I it's above my pay grade. Yeah. Yeah. And I think, I think that that's the responsible take. I also take to, like I said before, like there's a certain things I just not understand the deep level pieces of it. Um, but I try not to still be, I still try to as a good steward and participant in the Bitcoin ecosystem, try to understand this stuff so I can have some level of opinion because at some point a fork client will come and it'll be, will you run it or will you not run it or will you run an actual rejection of it? Right. Will you like force a

fork right and you have to have some baseline level of understanding because you have to run a node you've already opted into the game because you have a node so you have to make a decision and not doing anything is a decision so yeah uh i mean i'm i'm still long-term bullish on bitcoin it's great to be here in texas i got to come to the commons i wore my unchanged shirt today all of my uh bantering about uh bitcoin park versus the commons i wanted to wear friendly colors even with my little blue check pin here to uh make sure that i come in peace so you started some with that chart listen it i've had some really good breakfast tacos here they're not as good as ladybird out in nashville they're gonna start some shit austin inspired ladybird tacos yes they

are oh yeah i'm a proud member of bitcoin park um i have to do my proper ribbing of the commons while i'm here i'm a member of bitcoin park too yeah it's it's a magical spot man it's uh but I've been there six times this year. Every month having someone, a different crew, people rolling in, getting to see different people, me shamelessly harassing poor Steve Myers about whatever latest bug I'm

having in Bitcoin. It's like a local help desk support and great people. Yeah. It's been, it's, it's incredible spot. And I do love Austin. I mean,

I've been here the five times, most four times probably in the past year. I was here for Bitcoin plus plus. I was here for the South by Southwest takeover last year. BitBlock boom last year, BitBlock boom this year. It's a great town. And like I got something by PlebLab, like people are building and people are working.

And you wouldn't even know it's a bear market, man. Everyone's just heads down grinding along. And it's a great time to be grinding along and building that cathedral. I agree. And I want to be clear, I'm still extremely bullish on Bitcoin too. I didn't want the conversation about ossification

to come off like I'm worried but the long-term survivability of bitcoin i'm not but i do think conversations like this are important absolutely um because as the years go on we're approaching 15 year anniversary of the white paper and eventually the protocol going live and where more people are adopting it like the the literally the value at stake is increasing and these decisions come with way more weight like and yeah which is also weird like at the bitcoin core level like people are a bit dejected and burnout i've been seeing that yeah it's just like how do you weigh all these things yeah um it's this idea i think like developers want to build things and see their things like they want like

to be motivated like um it's it's the equivalent of like in the sense of building the cathedral do you want to be building one of like the pirouettes like like one of like the towers or do you want to be mopping the floor right because like there's a lot of grunt work that needs to be done of just doing pull request review and writing unit tests right like things that aren't sexier glamorous or aren't changes at bitcoin and you have to bring people in to want to like help maintain that cathedral and i think there's been a natural kind of model of patronage where people are like higher developers that work on bitcoin full-time right i think that's like you have open sats you have spiral grants you have the hrf grants like there's a lot of things that are like

there's a natural ecosystem that develops around it to help try and provide that maintenance and just trying to make sure everyone feels happy and motivated and they feel valued right i think it's another thing too it's just like um you don't have to do anything special but just like like gratitude and appreciation for the people that are just kind of like doing the grunt work that is not fun or glamorous at all yeah let's give a shout out to Russ Yanofsky for all the hard unglamorous work he's done to separate the wallet and the node. Oh, that's a huge undertaking that massive, massive shout out for that. Absolutely. That thing is like a, it's like trying to separate conjoined twins. Yeah. He's been working on it

for like seven years. Right. Yeah. And that's a, it's one of those things that is just slow and steady, but that's a really important thing for, cause like we run multiple nodes, like what we're building and like, just if I could just have the node and not have to worry about the wallet architecture you can run wallet disable whatever too but like it's just housekeeping and infrastructure yeah yeah um beyond all these protocol developments and application developments what are your thoughts on like bitcoin as it stands in the overarching macroeconomic landscape right now like do you think there's headwinds or tailwinds for bitcoin um so this would be like putting on my macro think boy hat um you're a good thing boy i'm a good think boy i try to stay in my

lane of like the nerdy think boy as opposed to the the macro thing but i guess my my take would be that um interest rates are continuing to rise which is probably the largest macro factor on uh risk assets at large if you put bitcoin that risk asset bucket i would say um it's been fascinating watching the like the housing market still not capitulate on price even though like someone who's like looking to buy a house and it's like 30 year mortgage rates are you know seven percent and the prices haven't moved because it's like no bid everyone's like has airbnbs and they're renting things out or their people rent and or there's no actual liquidity right it's like the market's like just like frozen and austin here it's like even worse i can imagine

um but it's not sustainable you you uh as the debt has to get rolled over um i was listening to uh preston pish's latest podcast and they were talking about like a lot of companies like just locked in corporate debt like five ten year corporate debt at like two percent interest rate like when i was like at the bottom so even though rates have jumped there's a huge lag on people that are looking to buy a house right because if like if you're not moving the 30 year mortgage interest rate being seven percent doesn't impact you right and if you're if you're apple and you refinanced billions of dollars of debt at two percent interest you're not you're not really you're not affected yet right it's when this stuff has to start rolling over and

the people who've mismanaged the most is the government the government that has been massively like they should have been raking like doing mass refis when we're in the covid slumps and like you know everyone's flooding to u.s dollars and demanding it but shockingly the u.s government mismanaged shocking shocking breaking news so like i think you're gonna have natural pressures um we have just as a more people are retiring people are trying to like check out um live off their retirement savings you're gonna have um i think overall the piper's gonna start getting paid when it comes to all of the entitlement spending the government has to keep on printing like we're just printing another two trillion dollars or something this year it's just like oh there's

just another two trillion right like things that were as deficit not spending just deficit more than what we're actually collecting in taxpayer and i think inevitably you're gonna have to it's basically a game of chicken and while they can run rates for a while longer and higher short of insolvency and massive printing they're gonna have to drop it and that's kind of like an opportunity where the release valve blows up and bitcoin you know runs off to the moon yeah yeah yeah the rollover thing is something that most people are not prepared for no like the interest payments on the debt alone at some point next year are going to balloon like above 1.5 trillion right and they're not going to have the will in congress to raise taxes to do it

and they're also not going to see them yeah it's election season and they're not going to have the will to reduce benefit payments right like like um this is like one of the things that trump did um that was polarizing at the time from political pundits but from a political posturing was genius was just like i'm not even going to touch the third rail of like entitlement spending and that's where you have people like paul ryan who just kind of like flopped because it's like shut up nerd no one wants to talk about reforming any of this stuff we just want to keep on living in the party well that's what like people really don't understand is yes we're at 33 trillion dollars in debt but if you add in the entitlements it's like 250 trillion yes it's a quarter of a quadrillion

dollars unfunded liabilities because these things are commitments we've made to the american taxpayer and the money has to come from somewhere yeah and then this is where like there's a natural forcing function where eventually you're going to have to have that devaluation of the dollar and you're going to want to be holding onto things that aren't dollars. And that's where like, that's where like the short to medium term, I try not to have any strong opinion on price action one way or another. Um, but the inevitable long-term outcome is a devaluing of the dollar. It's the only way through there unless, uh, well, especially now that LK 99 turns out to be a hoax, but I mean, genuinely like some sort of like room temperature temperatures, like soups, like superconductors,

like some sort of crazy step function in tech that like, like all of a sudden we have like orders of magnitude and gained productivity short of some sort of miracle rabbit out of a hat like that. You're gonna have to devalue the dollar. Like there's no way out of this. I guess you're not, you're not picking up what Spencer shifts putting down these days.

What is it? What has he been talking about? Like mass devaluation. Like we're not going to need money anymore. Everything's. Oh, AI. Yeah.

Oh, because large language models. Yeah. So I previously was a, I was a data scientist at IBM before, uh, started anchor watching. Like,

and i only say this to say that um the step functions and there is a compounding effect of like how much better it's getting it's still massively oversold in the scope of what it's able to do it's able to do narrow domains very deeply but it's not going to be massively disrupting every single capacity of everything and we live in a post-abundance space communism everyone has everything they ever want like well like it's still not going to happen like there's still physical constraints in the real world that govern us all like you still need oil you still need energy like those things aren't going away yeah you need energy to run the ai that's right it's i think that's something that people really don't understand intuitively i think that's gonna

be really interesting the idea of um data centers from competing against hash rate versus um ai like like actual training crunching of models yeah i think um i mean shout to caruso they were ahead of the game many people were knocking them years ago for doing co-located asic mining and uh hpc seem to be a very smart play on their part and i think yeah i mean from miners perspective like it does make sense to diversify revenues um to um to areas outside of uh block production i imagine also because like everything short of the last mile and in this case i mean like literally the thing you plug into the wall is identical infrastructure it's your it's electrons at the end of the day no matter what you have to worry about probably like stability if you're

like off-grid mining and like you don't have internet so you can't like yeah uptime is more of a like a very high priority for ai versus bitcoin which is not as high of a priority right you can be disrupted and not up the bitcoin network but totally when it comes to these models you could them up oh yeah data reliability too like just like submitting your work shares is a much more straightforward thing compared to the two-way in like you get a block template you just just start doing the mining versus like this is the specific query and here are the parameters like it's a much heavier like data infrastructure you have to manage to and then you have to do all that network routing internally and all that stuff yeah no i could i could see while it's nice there

are that last mile of difference is a lot of operational differences yeah for sure yeah um so with this all this in mind wrap up with this like do you feel urgency to build what you're building to get these tools into people's hands so that they're ready for a massive devaluation or maybe even before that devaluation comes on the dollar side bitcoin is just better and people begin opting into it yeah manufacturer soft landing i mean in the sense of like the sense of like urgently trying to build the arc yeah right um it's a very strong motivating force and it's very you know from a sense of giving yourself a sense of purpose it's very rewarding and very high charge to give you the endurance to push through because it's not like it's been

a lot of work to get this far and there's still a lot of work to do and if you're not doing what you love this is just like from what i'm doing but as a general concept if you're not doing what you love you're going to have this inertia and friction that starts to compound and you're going to start getting demoralized, but it takes a very strong conviction and high passion to charge through that and push through the friction. And that kind of sense of urgency is part of what, at least for me personally, is a motivating force of building better tools to make Bitcoin better money so that when the time comes, we're able to get more people on the life raft and like things like, you know, mini scripting the tech side, um, and being able to enable this more advanced

custody solutions, um, being able to have an insurance financial wrapper. So you're able to actually have, um, you know, better confidence so that you have custodians and stakeholders who are holding money for a third party are exhibiting better behaviors to protect customers. Right. Um, those are all things that are really motivating for me. Yeah. Yeah. Well, thank you for doing what you do. Thank you. Thank you for doing what you do. You know, long time listener, first time caller i've been listening i can't believe it took us this long we wanted to do it earlier this year but it was going to be remote i was like you know what let's wait tour in person yeah no absolutely yeah i've uh i've been listening to tftc probably near the start not like right at the start i

remember one of the early rabbit hole recaps like finally something i could start listening to right but uh because that's why i was like more active on twitter like starting to get more into the bitcoin culture and scene for sure um but yeah that's uh great and you're also a new york city devs alum right yes yeah i started going in january 2015 right after uh the hong kong agreement i was december 2013. i went i went through my old meetup emails it was socratic meetup 13. yeah they're like 100 and whatever it is now oh i think 200 is actually coming up this week no kidding this upcoming week i'd love to go back shout out to the crew there yeah shout out to j max um incredible guys yeah now i moved to new york in september 2014 my first bit devs was

january 2015 and i'll never forget i have my notes too my journal um like russianovsky was actually explaining segwit for the first time to people wow um i have it in my notes like how segwit works like what is this thing and um yeah it was pretty cool that that was my first bit devs I was at a bit that the bit does where Vitalik came through before ETH launched and he did a whole presentation on ETH. Oh wow. Yeah. What was that like?

It was really interesting. Cause he had a whole posse of like a dozen guys rolling with him. Cause if you people would, every bit dev someone would do a presentation on something. And I had seen some conversation around ETH and Vitalik showed up and he had like a dozen guys with him. It was like a whole crew that rolled, which was very different compared to other people.

Like I'm a solo engineer working on a project. Right. So that was interesting for sure. but yeah that's that's really was like jumping in the deep end because i did not know anything about bitcoin i walked in there doing pull requests of c plus plus and i was like i've knew walking in that's really orange pilled me was like walking i'm like there's a lot of very very smart people here working on a really hard problem and i don't understand anything that's going on here and that call to adventure was really what pulled me in yeah no i think new

york bit devs for me allowed me to start this podcast in the newsletter i started going two years before any of this started and like you i've gone in there i was like i have no idea what these guys are talking about but i know they're smart as shit i got that gut feeling that they know what they're talking about and over the years i'd show up and be osmosis it is osmosis so true slowly but surely began to like get a better understanding again nowhere near the ability or capability to actually fully understand what's going on but i think i do have a better grasp of how everything sort of interacts with each other from going yes to these bit devs meetups over the years for the last eight years and you often get a lot because people start

debating and fighting in front like like disagreeing and then you're like okay now i get to see both sides of an argument you start to like piece these things as little like you know like puzzle pieces to get your fuller understanding it's definitely um if you have a bit devs in your city and you want to learn more can't recommend it highly enough yeah i mean it's the most high leverage thing you can do to yes understand the stuff that hopefully most people don't need to understand but if you want to be able to talk about it if you want to jump in the deep end you can there's the olympic pool for you yeah absolutely rob it's great to have you in austin it's great to be here it's a good place to visit i'm pumped we were finally able to do this i'm

sure this won't be the last time absolutely not yeah what uh what's your parting note for the freaks build the future you want to see in the world it's a good parting note peace and love freaks Thanks for watching!