TFTC: A Bitcoin Podcast - Tales from the Crypt #98: Carla Kirk-Cohen

Episode Date: September 17, 2019

Join Marty as he sits down with Carla Kirk-Cohen, the last of Chaincode Labs' Summer residents to swing through the studio, to discuss: - Carla's journey to Bitcoin - Her passion for the Lightning Network - Life in South Africa - Bringing LN to an exchange - Things that LN enables that weren't possible before Follow Carla on Twitter: https://twitter.com/actuallyCarlaKC Shoutout to this week's sponsor, Cash App. Cash App. Head over to the App Store or Google Play Store, download cash.app and start #stackingsats today. Use the promo code: "stackingsats" to receive $5 and contribute $5 to OWLS Lacrosse you download the app. Subscribe to our YouTube channel: https://www.youtube.com/channel/UCtdbWsnfA08KhSUO4amVLaQ?view_as=subscriber Contribute to the show: https://tftc.io/contribute/

Well, hey there, freaks. It's your boy Marty Bent here to introduce this week's episode of Tales from the Crypt with Carla Kirk-Cohen, who is the last of the Chaincode Lab summer residents to come through the studio. This year, we had an incredible conversation. For those of you that don't know, Carla is fascinated and working on the Lightning Network. She was part of the team at the Exchange Luno in South Africa that was the first exchange to implement Lightning Network into their services. she led that that initiative and we talked about it as well as her experience at the chain code summer residency this summer her thoughts on lightning what needs to be added to lightning and her experience growing grapes and making wine in south africa this episode of tales from the crypt is brought to you by the cash app freaks if you are in the united states

and you have been listening to this podcast for the last year and you have not downloaded the cash app yet what the hell are you waiting for it's the best app in the states to that allows you to stack sats you can sell sats you can send sats to a personal wallet or you can send sats from a personal wallet to the app to then do what you see fit with them use the code stacking sats it's one word s-t-a-c-k-i-n-g-s-a-t-s upon download if you haven't done so already and you're going to get five dollars and five dollars is going to go to owls across a great charity in chicago doing great work uh to help young boys and girls develop leadership skills through the sport of lacrosse so again use the code stacking sats download the cash app use the code you gotta download then use

the code uh you're gonna get all that great bitcoin stuff and then on top of that you're gonna get the boost program where you get your personalized debit card with your hot uh signature you you turn on your boost whether it be whole foods coffee shop chick-fil-a door dash pick your poison you go you shop at those merchants and you save money so again use the code stacking sats get yourself five dollars send five dollars to owls and then start using the cash app and start stacking sats hope you guys enjoy this episode with carla i know i certainly did what is up freaks welcome back to tales from the crypt here from the studio for recording number two of the day sitting down with another uh

well i didn't record with the chain code resident earlier today recorded with eric bosgool you guys probably heard that by now uh but now sitting down with yet another uh summer resident at chain code labs i'd like to introduce you freaks to carla kirk cohen carla welcome to the podcast hey marty thanks for having me long time reader of the bent good to be here really yeah a long time you just surprised me with that yeah i hope uh have to say something for the podcast i hope my uh my dumb words haven't made you dumber ah never well how long you been reading uh probably about a year and a half um wow when i started kind of digging deep into crypto twitter when i was like yep let's get on this this messy bandwagon i kind of came across

you on twitter and subscribe to the bent and yeah big fan well thank you i think you are officially considered uh marty's bent og if you've been into it uh for 18 months at this point uh but before you subscribe to the bent how did you find bitcoin like how how did you come to to get to chain code summer residency and work on Bitcoin and Lightning? Yeah, so it was a bit of a journey. I studied computer science and economics. I finished up my studies about two years ago. And pretty shockingly, I didn't hear much about Bitcoin at all in my computer science years. We have pretty different structures in South Africa. We have three year where you do a double major and then you do something called honors. And most people do one honors. I chose to do a

year honors in CS and then a year honors in ECOS because I couldn't really decide between at the end i realized economics is a bit of a pseudoscience so i went the computer science route um but yeah i was in my economics year and someone asked me about bitcoin and they showed me the white paper that they've been reading and i was so relieved that he wasn't asking me how to install the printer on his computer because he knew i was a comp sci student and i read it and i just finished kind of a security and penetration testing internship and i was kind of blown away by the security model I read it and I was like oh this is cool and I was like no no no that can't work that's impossible and I kind of went through this like denial and acceptance phase going through

the white paper reading some things online all that and kind of cycled through until eventually I was like oh damn this is great I want to work on this got to the end of my year and I looked around for something to work on that I cared about couldn't really find anything I don't really care about online shopping I don't really care about investment or risk analysis but I did find a company called luno where i currently work and it was a bitcoin first exchange and wallet so i applied joined the crypto ops team and yeah so what's it like uh working at exchange oh it's pretty cool i was really fortunate that i got to join at a cool time so when i joined we were only supporting bitcoin and ethereum and about nine months into my time at luno i was given the opportunity to

choose my own projects and i said i want to integrate the lightning network and someone was not paying attention upstairs because they said yes and they let me forge ahead on it so a large portion of my time there was running this really cool fun production ready lightning integration so i really enjoyed it what uh what is it like integrating lightning in exchange what functionalities were you leveraging or were you just testing stuff uh so we started out with a proof of concept we had absolutely no idea how tech worked we had absolutely no idea if it was safe if we could use it so we started out with like a proof of concept web page so a little page which with my ux skills two buttons one text box that was it those are great ux skills the less

the better no css on the page whatsoever minimalists in stock um yep and we added sends and receives in production once we kind of had that running and enabled for internal users we're kind of playing around with it putting a bit more money in our nodes bringing out how we wanted things to and then the company decided to add it to the wallet product earlier this year so we started out adding it to our API so that kind of more advanced users could play around with it and then to our merchant solutions so we run one of those merchant solutions where you pay with Bitcoin and immediately trade and exchange into fiat if you choose so we added to that because I think lightning

solves a lot of the issues that merchants face with Bitcoin payments and now we're beta testing with users so it's gonna be in the app on the web page and people can use it as little as they like hell yeah are you the first exchange to be experimenting with it in production i think someone else announced recently that they were adding it it might have been huddle huddle that was playing around with it it wouldn't surprise me yeah pretty early i think yeah but even huddle huddle is what a decentralized exchange so p2p exchange excuse me yeah um so luno is probably the first centralized exchange to be yeah i think it's the first um yeah first custodial exchange we're working on it i don't know of any others

uh yeah but it's kind of the nice thing about being a smaller less mainstream exchange i'd say we focus a lot in like emerging economies so we're big in south africa we're big in malaysia we're big in all those places so because we're kind of small we still get the chance to move very quickly on new stuff so we implemented segwood very quickly we had segwood sends going out very quickly uh and lightning is kind of the same thing you get that advantage because you're still pretty small yeah more nimble so let's back up a little bit like how did you come to focus on lightning in particular uh because that's what you've been working on this summer and obviously at luna that's what you're passionate about and what uh what was like the course that you took to

to realize that lightning was what you wanted to work on um i think the course to lightning was very much from once the initial bitcoin peak subsided i was kind of sitting you know figuring out huddling and i was like oh you know like pretty much the only use for bitcoin right now is trading and trading is a game we've all played but it's a very stressful game and i was kind of looking on twitter and online and thinking you know how can this be used in a different way and it's also really interesting coming from south africa which is a country with which is pretty unstable uh politically unstable it's got a really terrible currency it's right next door to zimbabwe so we all kind of really understand the consequences of inflation but we also have

a really unique payment space like a large portion of the country's unbanked so we're pretty good on on mobile tech and mobile money and when i come here and i look around like i haven't seen a qr code since i got here and yeah they're not big over here yeah and at home i make 40 to 50 percent of my payments with the qr code you know it's just on my phone it's an app i pay the qr code coffee shop grocery store you know pretty much anywhere now and that's kind of the way of being that we're used to so i thought that lightning and that kind of payment system it fits really well into the world that i know even though it doesn't really fit into a more traditionally banked country as much yeah that's fascinating how uh so is that like an empeza like system

that you're using it's not so much in peso we have um we have card to qr so it's kind of like not renmo but like your card is connected to an account and you can just pay there and then they settle with the merchant but like they have pretty high fees so there's a few there's a few competitors in the market i think there's something called snap scan there's something called zapper and both of them are kind of bank independent but they became so popular that now the banks in south africa are coming out with qr code scanners on their apps which scan all those different companies kinds of qr qr codes and integrate with all of them because it just took up took off for us so the bank's catching up with the uh startups so it's

like a cash app like system yeah yeah kind of like that um yeah the banks the banks don't move as slowly in south africa as they do here surprisingly um when i came here it was the first time i'd ever seen a check yeah i got this piece of paper and they were like here's your paycheck and i was like is this money what do i do with this thing no um i actually i've had a check delivered to me today and i had a mobile deposit but it was the first time i've deposited a check in quite a while and it's it is a very archaic uh form of money yeah it's a crazy form of money and you know we we would never have that at home like people would just go forging checks left right and center be like that leonardo dicaprio movie like it's just such a strange thing

to see in a first world country that you still have these crazy old methods because you haven't really ever had the demand for it i guess if you don't need it you're not going to move as fast whereas at home because we have this crazy different set of needs the banks move pretty quickly on stuff like that what do you mean by different set of needs so we have a much more informal economy we have a lot of people trading on the side of the street a lot of people don't have formal addresses they don't have smartphones so it's a really different set of of use cases you're looking at so we also have like a very big market for sort of mobile card machines which connect to a phone because people don't have traditional internet connections down to the

point where there's a lot of uh people in south africa in the informal economy who trade in air time you can send air time between like numbers on the same network for free air time like the but oh yeah you have unlimited calls in the state yeah phone minutes and phone data so airtime and data and to make a payment you just send someone on the same network as you some airtime because that like almost acts as a currency because it's easier than sort of whipping out your cash or most people don't have a card or a bank account so that's kind of what they go with yeah and that's uh yes this is what uh i don't know if you know beauty on but beauty on and as techo which is like similar concept to that but with bitcoin you can buy minutes uh out of using voucher system and

something like that and top up your card as you would with like minutes on a phone okay cool but it seems like yeah it seems like this is a natural use case for for something like lightning where you just make quick micro transactions to to buy minutes or something like that yeah it's pretty exciting i think there's a lot of challenges to that obviously like the flip side is we have this payment space um which is really suited to lightning but we also don't really have people who are going to be always on right the ability to even charge your phone is is like sometimes rare for a lot of people in south africa live in informal housing um so although it is like a really interesting use case and it is a space that i think would adopt it pretty quickly i think

there's also a lot of work that needs to be done in the lightning network to make it more friendly to lighter clients and to more hands-off use which is what i think is like a really interesting domain and what i want to work on yeah so let's jump into like what are the inefficiencies that you believe exist and how do you think we could solve them uh one of the biggest issues i'm pretty interested in is the operation of routing nodes in the lighting network so people are kind of looking at this emerging classification where something like your phone which wouldn't be always on it's going to run out of battery it's not going to have data that would function more as a personal node you just have like one channel open you use it occasionally but you're not really

aiming to earn fees or be this big hub or anything like that and you do that through setting up private channels so people can't actually route through your channel which is really useful because your liquidity is only locked up by your own payments and then that's kind of like the one use case the personal use case and on that side of things they still do need to be able to route payments in the network so they need knowledge of the network graph so there's a lot of work to be done there in terms of like optimizing the network graph reducing the amount of gossip sent over the network so you don't just like kill someone's phone with network updates as they start up and then the other thing which i'm really interested in is the running of routing nodes

so if we have all these phones that are kind of like light clients although they do do all their own work and have their own bitcoin nodes you need these nodes that are super connected and they have lots of channels and they manage their liquidity and they do all this stuff and at the moment it's crazy incentive incompatible like i read this article the other day that alan big locks up five million dollars of bitcoin for 40 of fees a month that's pretty crazy yeah that's pretty crazy and yeah i don't think i'm ever going to make anyone five million dollars of routing fees if i could i wouldn't be telling other people how to do it but i think there's a lot of work you can do in optimizing the ability to run a routing node so smartly opening and

channels rebalancing automating all of that and really taking out of the effort side of things because if you can kind of like if you're a hobbyist and you set up a routing node somewhere on an old laptop you just want it to be able to maintain itself you don't want to have to constantly go back and fix it up so i think a lot of work that if we reduce the amount of effort it takes it reduces the amount of altruism we require because you don't really want to be in a stage where the network actually requires people just to be doing this for fun. Yeah, no, you definitely don't want to be in that stage.

You don't want to depend on goodwill of others. You want it to just work incentive-wise. I'm pulling up our routing node now. Shout out to TFTC Stacking Sats node. We're up to 1.168% of the Lightning network. Oh, wow. So what would you recommend we do as a routing node? As a routing node?

It sounds like you're doing okay already. But yeah, I mean, I guess it's that kind of active management of your channels so if your channels are sitting unbalanced for a long period of time that means you're missing out routing in one direction because the funds can only move one way that's something that i think can be pretty easily automated uh more um discerning opening and closing of channels so i think if everyone just opens channels to the block stream node or to yours we're going to end up with a pretty ugly looking network and you don't actually want to be connecting to those nodes because they're not sending payments that much right they will tend

to have liquidity centered in one place and actually not have balanced channels themselves unless it's yours which alex buzzworth keeps pretty tightly balanced and pretty clean he earns a ton of fees um yeah i think uh sorry i was hearing some disturbance from the mic i think you just gotta hold it no no hold your hand up here yeah i think it's like this is a um i'm sorry for interrupting you there but uh yeah so that's like one of the crazy it's a lot of hands-on processes right now and that's what pre-interview we were talking about you've been working on autopilot stuff trying to make this more automated and so autopilot like i've had bad experiences with autopilot where uh there's open shitty channels with people who who would

close them pretty quickly after or not respond um so what uh what do where do where does autopilot need to get to where uh it's sort of off and running and it's actually working well yeah so uh there's there's two parts of autopilot obviously the opening of channels which i haven't really been working on that much and the closing of channels so like briefly on the opening of channels i think that you need to open to nodes that are reliably online because if you've got an offline peer enlightening it's a nightmare they can't update your channel you can't route anything through it and when you close you're going to have this big fun delay because they're probably not online to clear all the htlcs so i know that lnd is working on like buzz scores which

are node scores which monitor uptime and monitor some of the performance of nodes other channels through basic probing in the network and that's how they're currently informing how you open channels and i think that'll really help for cutting out those those bad nodes from the opening process there's also a ton of stuff that you can do in terms of connecting intelligently so you You want to look at the graph and connect in a way which puts you in the shortest route for a lot of nodes on the network. And you can run some graph level metrics on that and kind of connect in that way. And Brené Pickard is working on a sea lightning plug-in which looks at that.

So connecting in a way that puts you like in the thick of it in all of the traffic in the lightning network. So that's the opening side of things. The closing side of things is what I'm looking at. I like that it's got kind of a cool economic opportunity cost tradeoff vibe to it that Once you have money in a channel, you have the opportunity cost of having that capital locked up. But you also have the cost of closing the fee, of closing it with on-chain fee. So when do you kind of make that call?

And as a human, you'll like sit with your finger on the button forever and never actually close it. Because, oh, maybe it'll turn it around, maybe it won't. So yeah, I'm looking at some scoring similar to what Buzz calls to, but more specific. Because when it's your own channel, you get a lot more information. So the basic metrics are uptime, is your pair around? the success rate you're getting in that channel so how many payments route through and succeed versus fail the fees you get the volumes you move and then the amount of personal utility you get from it so if you're actually using that channel a lot for sends from your own node you don't want

to close the channel to your local coffee shop if they actually support lightning so you keep that open and then yeah that's what i've been working on this summer and my next steps it's been you know we're sort of establishing the fundamentals now but next steps will be to kind of play around with those four metrics and see how we can optimize them for different kinds of nodes. Who have you been working on this with primarily? I've been working on the L&D implementations.

So I've been getting a lot of mentorship from Johan and Jost, who are two L&D team members. Been incredibly helpful. Had a few calls with them, some chats in the PR, all good stuff. Yeah, this is actually, Lightning is,

I actually haven't had too many people working on Lightning specifically on this podcast. I'm very happy you're here. can you help us uh sort of discern between c lightning and lnd uh sure so there's three implementations there's async which is a scala written implementation with the eclair mobile wallet there's lnd which is maintained by the lightning labs team it's written in golang and then there's c lightning which is maintained by the c lightning team over at blockstream um yeah the difference in the implementations i think lnd at present is pushing features out

pretty quickly whereas c lightning are very concerned with the spec and getting the protocol right because they're just kind of pushing out lightning 1.1 which is the newer spec but all three of the implementations work together they have irc meetings every week they only push out a change well they only accept change into the protocol if two of the three implementations have implemented it and tested it and tested compatibility so yeah at the moment everyone's working together and making amazing progress on the protocol spec and actual implementations like you said lnd is pushing out more uh features building faster if you will is there is there advantages to using one over the other at this particular point in time or

i'm pretty biased because i'm a golang dev so i kind of um went for lnd immediately i didn't even i've i did a c coding course in university and i was so scarred by it but so i didn't even dare look at sea lightning um but i think that lnd at the moment is working on a lot of the usability issues in the network which is pretty cool so they were the first to implement watchtowers who are people you can outsource the monitoring and the lightning or two they've got some cool stuff going on with routing in terms of um probability based routing and really like tuning the pathfinding but i'd say the main difference is that lnd is like one lightning node in a box it's this big thing and it's got a great set of features whereas c lightning is

plug-in based so if you're a coder you want to play around with your own stuff you want to maybe write some plugins c lightning is like definitely the way for you to go if you do want to have a high degree of customization whereas for lnd if you want to just run a node and it works pretty damn well you go with that yeah and getting back on the uh not getting back on but you mentioned uh channel routing like that so we matt and i uh my co-host we we spoke with the team from noddle that's building that hardware node that connects to lightning as well and uh michael on that team is experience uh in traditional telecom and hardware and and he he thinks that uh lightning needs needs help with channel routing in particular they need more eyes on on how to to make routing

more efficient and and more uh straightforward if you will so do you do would you agree with that um i definitely think we can get better i think it's a really interesting trade-off the lightning is made because the big issue we've got with routing is that channels have balances on either side and if all the balance is on one side you can't route in that direction um but we don't disclose that when you're routing um so you know how much is in the channel but you don't know which side it's sitting on and the reason for that is privacy so if we all just broadcast the like tiny changes in our channels over time it's pretty easy for an attacker to decorrelate payments so to trace one delta throughout the network say oh look 10 satoshi went between me and marty and

then marty and james ov and james ob and whoever and so whoever must have received 10 10 satoshis from me and while i do think we need more eyes on it i think that's kind of a fundamental trade-off that's being made um i think that a lot of implementations kind of um iteratively route so they they make a few attempts before they try but this is kind of why i think that the channel maintenance stuff and autopilot stuff is important because we're not going to reveal those balances anytime soon it's going to be a huge hit to privacy and i think lose one of the big value propositions of the lightning network so instead of trying to optimize routing i mean if someone if someone knows how sure but instead of trying to optimize routing trying to optimize

the underlying networks that is more favorable for routing i think there's a lot of quick wins there versus trying to find out a better way to route which is really really challenging yeah so what are the quick wins uh the quick wins is automating rebalancing i think i mean you can rebalance at the moment just by looping a payment back to yourself through the network it's got a bit of risk attached to it because you have to use um zero value invoices and i actually don't think you do i think you just route payment back to yourself but it's got a bit of cost you pay fees there's some suggestions on the lightning network about rebalancing uh on the lightning network mailer about rebalancing as you route so if a node hits a channel it needs to route

through and it's not balanced it quickly ad hoc rebalances that channel and then routes on i think that's pretty interesting um because that would lead to a lot of more successful payments uh yeah that's the so when you said loop right that's when you sort of atomic swap sats from one side of the channel to the other okay so you can loop just like through the lightning network right so if you have a channel that needs incoming capacity you just loop and receive a payment along that channel so you loop out on one channel loop is a rock is bad word because that's also the name of a atomic swap service yeah yeah so you circulate you do a circular route out of one of your channels and in the other one so the coins just shift in those two channels so you move it out in

one and in on the other and that's like circular rebalancing and you just do that by sending a payment to yourself and like figuring out the route manually and then loop is a subatomic swap service which lnd offer and that is yeah that is an atomic swap which will rebalance your channel with an on-chain payment do you think there's uh you think one is more advantageous than the other one strategy um i think that the conditions for circular routing you you need a certain set of conditions to be present right so you do need to have more than one channel if you don't have one if you only have one channel out you can't loop out because you have everything not loop out you can't circle out because you only have one channel open you need to be able to find like a nice route

back to yourself and that payment itself might fail right because it's another lighting network payment so i guess that's kind of the trade-off you make whereas subatomic swap it's pretty certain it'll go through and you know you're going to rebalance but if you do try and make a circular payment that might fail as well because of the same issue so it's kind of recursively going down that rabbit hole interesting are you optimistic about the current state and future of lightning do you think it will be a successful second layer i do i do i mean by virtue of the fact that there's nothing else i think that comes near to it i don't think anyone's gonna come up with some crazy layer one scaling solution anytime soon and i think the network shows a lot of problems like it's got

it's got hard engineering issues but it seems to be working it's you know people can make payments the network is kind of settling a bit people are putting more and more funds in and i i think the protocol works i think it's complicated but i think it's functional um so i got a lot of hope yeah and you're uh you're hoping that more people are using bitcoin as a medium of exchange soon right yeah i think so i think it would be cool um i know it's pretty controversial payments versus store of value but i think it is controversial why do you think it's controversial well i think if you if you fully you know if you go fully down the the bull run and the bullish the bullish view in bitcoin is that bitcoin is always going to appreciate you know the price is going to move

up and down but in the long run the value of your bitcoin is only going to increase and if you really fundamentally believe that why would you be spending that on coffee because then you're gonna end up like bitcoin pizza guy who paid however much for pizza yeah i think he i think he was going up spending 20 000 bitcoin i think he or was it 10 000 20 000 i forget he bought multiple pieces but i don't know it's this weird chicken and egg problem right you need to show the network works as a medium of exchange to sort of entice people to come use it and i'm a believer that bitcoin serves all those purposes in one like a medium exchange and a store of value it can be either or depending on your particular uh situation and time preference so some people need to spend

bitcoin right and making it easier and faster uh in my opinion would definitely lead to more people using it and we see that with our website with tftc.io with our dime bag people are people are giving us a dime's worth of satoshis every day um the amount of invoices created every day has been growing uh it seems like more people are experimenting with it yeah that's pretty exciting i think like the big thing that lightning really has to offer it's like oh why would you be spending your bitcoin if you don't have to if you maybe are holding i mean most people are holding some fiat still i think that there's a huge privacy gain there which people don't really talk about as much in that whole trade-off so i mean it's it's in the white paper that you want to remove

those financial middlemen and you have all these stories about people you know making a payment on visa and then next thing they know they have an advert show up on instagram for the same product you know you do not have privacy with your current way of transacting and perhaps you will lose a bit of value of your bitcoin if you do spend it now but you do gain a lot of privacy and i think that's really important so how's the privacy gained privacy is gained because you well first of all no one can see what you're transacting so all of your sends are anonymous so the people you send to i mean if you sort of stick an invoice up on a website people don't even know who's paying everything in the in the lightning network is onion routed so you can see who sent you a payment

who routed a payment to you and who it's going to but you don't know who sent it or who's receiving it um so there's not a lot of privacy gains there and then in terms of on-chain privacy your net balance is is settled on chain so you could have made 100 payments you could have made one payment and no one can really look at that and say oh you spent 0.1 of a bitcoin maybe you spent it on this one in this one specific place yeah that's fascinating and it's something i do believe is underscored as well as the privacy gains on lightning and um so do you see more people using it uh because of privacy because of the ability to transact in the future uh i would say if they're already using bitcoin it would be because of lower fees um but i think it's a bit naive to think that

the majority of people are privacy concerned um you could say that yeah i'd say that bitcoiners would use it because of privacy um i think that's definitely a win but in terms of the general use case i think that you will get people on because they want to transact with bitcoin you know although if you've got them if you've got them that far they might be privacy concerned already but well yeah that's a a big a big part of my uh sort of curiosity of the future of bitcoin is do people even fucking care like will they care to transact yeah don't you feel like a bit of a doomsdayer where you're like something bad's got to happen something i mean i feel like it's kind of happening now already if you if you're

looking at the global financial markets but when you you know you want people to value their privacy and generally people don't value something till they've lost it um so there's always that trade off of oh we want bitcoin to succeed but i do think there's gonna have to be some crazy some crazy incidents some crazy leak in privacy that really spurs people towards this although i mean i guess yeah i guess it already happened yeah that's why people don't care apathy is bitcoin's biggest enemy right now yeah but people don't know they need to care right because yeah i guess people don't care but like you know it happened on facebook some people deleted facebook it'll happen again with something else and yeah a little bit too late on my side but

did it um you know some people deleted facebook and so i think every time one of these things happen a few people do do realize what's up do realize that they need their privacy and you know kind of like from a technical standpoint if if something happened and everyone was like right we need bitcoin we'd be like oh my word we don't have enough utxos we have so much work to do so i guess a gradual trickle of people into the bitcoin ecosystem isn't terrible as long as it's happening and i think it is i mean if you look at market cap it definitely is right and i do agree like i think uh i don't know if bitcoin's ready for the masses right now from a technical perspective what do you when do you think it would be ready or is needed for it to be ready in that

i don't know if it'll ever be ready there's a lot of people in this world and i guess it's that question of of how you see bitcoin ending up is it going to be kind of where it is now where it's hobbyists isn't the right word because no hobbyists care about anything as much as bitcoiners care about bitcoin um so i would know zealots i would never insult bitcoiners with the word hobbyists um but yeah is it going to be a small group of people is it going to be something like bittorrent where a large group of people use it but it's not everyone or is it going to be like crazy global currency scale we don't know i'm kind of for the bittorrent level i would i would think bitcoin is a success story if we get to that level of usage and i think technically we could

achieve that especially with something like lightning which allows scaling on a layer two so looking beyond lightning is there other any other layer two solution that you're paying attention to or hope somebody would work on uh not really to be honest there's kind of alternate proposals within the lightning spec which i think are pretty interesting but every now and then something else comes up which might be interesting but then it doesn't really technically work out um so yeah i won't say bigger blocks because that's a terrible idea but that's like the only thing that people ever say that would vaguely scale bitcoin and it's just a terrible idea yeah i mean you the trade-offs aren't worth it at that point right you can destroy the ability to be

distributed yeah i mean if you want bigger blocks there are bigger blocks out there go use them Yeah. No, it is. Again, harping back to the conversation I just had with Eric Voskul, he really does a good job of breaking down, like, we want layering, not scalability. Like, Bitcoin is not scalable at the protocol layer. We just have to come to grips with that because of the way the internet works, latency works, bandwidth works. like it can only it is not scalable it can only get to a certain point and before it loses too much of its distributed nature so like layering on top of it is the way to quote unquote scale in the way most people define it yeah exactly and i also think kind of relating to my opinions in the lightning network and needing people to be able to run nodes you also want people to be able to run bitcoin nodes and at the moment we have a lot of public art nodes uh public nodes out there but they also kind of run altruistically you can run a node which doesn't serve blocks of

transactions but a lot of people do and you know i think if we do kind of start to see some regulatory crackdown we will see that number decrease because you know bitcoin nodes for broadcasting transactions and blocks they don't even earn a tiny amount of fees it's nothing it's just you want your node because you believe in bitcoin so i think making sure that it is as easy as possible to run that node is incredibly important and big blocks fact into that yeah I'm actually very optimistic about the recent developments of becoming more efficient and things like Erlay and L2 and stuff like that, making it more efficient to run a node is huge. I spoke with Gleb, had the pleasure of sitting down with Gleb last week, and I'm very happy that people like him are working on these problems. Yeah, there's good stuff happening.

It's been such an exciting summer. like we get to hang out with Gleb at lunch every day and Taj has been in town he's working on UTXO obviously that fits in really well with what James O'Byrne's doing with Assume UTXO so it's all happening you know slowly but surely Bitcoin Core is I think gonna see some crazy good improvements in the next year or two yeah do you uh do you think we're getting to a point I mean that's the other thing I think Bitcoin could be successful into perpetuity in its current form but i'm also a believer it'll be there's a couple nice to haves out there that would get it to a point where it's ironclad almost do you do you agree with that in any way or

oh i mean i don't think anything's ironclad right that's the whole security thing you don't know what your security flaws are until you're hacked um in terms of i guess like it's a more general question of bitcoin core stagnation because i know that is kind of a view that's out there that some people would like to see the code stop changing and just kind of be like, right, this is Bitcoin, we're done. I don't think we're there yet. I would be surprised if we ever get there, just from like a software engineering perspective.

Nothing's ever done, right? Nothing's ever done, done. And I think there's like great improvements coming up, like Taproot Schnorr, obviously everyone's super excited about. And even if we're not changing consensus code or soft forking, like just the kind of optimizations we can do on the peer-to-peer layer making sure we're DOS resistant like just always improving privacy and security like there's endless work to be done really yeah I think uh the recent Erebus attack that was uh made apparent to everybody is a great

example of that something yeah that was just discovered what three weeks ago yeah I mean even even more recently than that I think but yeah yeah and that's uh that's all it's crazy speaking with Gleb he's also working on fixing that as well how smart is that dude oh Gleb's the best I love it Gleb is like one of the smartest guys a chain code but he's also like I have like Gleb roulette well Gleb bingo when I see Gleb sleeping in different places in the offices he's like a serial napper he's like a sleep on every single couch I love it because he gets so much done so he works hard then he naps hard as well that's the way to do it yeah that's the way to live he's got it he deserves some naps yeah what and so let's talk about like the environment of being part of

like this residency and sort of the vibe of building and learning with this group that you've been together with for what that three months three months yeah 12 weeks yeah it's crazy like the the disbelief that this is where i where i am actually only like faded about a week ago and now we all have to go home in a week like you met some of the resis they're just like the crazy smartest people and they all have such different backgrounds and then on top of that you get to hang out with all the chain coders and just work on whatever you think is important and i don't think that a lot of people ever get that opportunity to be sponsored in new york and hang out and work on bitcoin like or lightning if you choose it's just been a game changer for me it's been an

incredible experience it's a great way to learn too right just bouncing ideas of very smart people yeah yeah like some of the the most learnings i've got about bitcoin are like around the lunch table just listening to the core contributors discussing things that they've been working on you just pick up so much information just by being there is there any uh sort of misconceptions that you had that are are now sort of cleared up in your mind after about the core process and how it works or any particular part of core i don't i don't think about the process because i you know i was just like oh it just kind of magically works i never really thought about it that much um but definitely interesting to like to get down into the daily operations of how these how these

contributors work so i hadn't really engaged in any of the irc conversations before that i feel like in bitcoin there's always more information and you just need to know where it is so like john newberry runs a core pr review club yes check it out shill every wednesday shout out every wednesday every wednesday at five o'clock utc um and like i didn't know that existed and you just get to listen to people discuss the recent prs on core and you get to read people discussing yeah yeah yeah exactly and like just all these resources that i didn't know were there like the weekly core meeting core devs meeting so definitely getting to know the the day of a core dev it's been super interesting do you do you find that bitcoin development's more

approachable after seeing how it works uh sort of firsthand and as intensely as you have this summer uh yeah definitely more approachable i mean i think everyone was always pretty approachable i've never really reached out and had a genuine question and had anyone um you know give me bat in this community at all people are so so nice and so kind and so patient that they really just like have always been willing to help but it's definitely been great to kind of meet a lot of the chain coders and the contributors and put names to the put faces to the famous names because coming from South Africa you see all these people on Twitter and you're like oh my word they're famous they're like these superstars and you know at least in the States you get to meet them every

now and again so coming here was like really like humanizing and amazing for me to meet all these people yeah we are very spoiled here in new york city i'm very lucky very lucky happy to be here what is the the bitcoin scene like in south africa oh is it big down there or no it's really interesting um south africa's actually got like the highest bitcoin well cryptocurrency penetration in the world is it all monero i don't know would we know if it was all maybe not probably yeah like there's something like database survey-based study out there so africa's got of all the internet users in south africa 10 of them hold crypto and that's like the highest in the world the world average is like 5.5 percent um but i will say that i don't

think the dev community is very big there so luna runs some meetups every now and again and you won't be so lucky as you are here to go to event like bitdivs where it's just bitcoin developers like they'll always be block chainers or f heads or something like that at the bitcoin meetup because it's just a small place right there are more people in new york than there are in the country of south africa so there's just not enough people to have that kind of community why do you think there's such high penetration of bitcoin ownership or crypto ownership i don't know i mean it can't just be that south africa's are like crazy south africans are crazy traders that's kind of the one the one thing you can think about but i was looking at that graph

recently and if you look at the top it's like south africa thailand brazil colombia so all countries that aren't kind of traditionally first world they're all emerging markets and like the the bull in me is like it's because bitcoin's working right it's gotta be you know i like this is a this is a survey based a survey based data so it's like just people taking things on a form but i'm like it feels like it's working it feels like it's happening a little bit um that's definitely happening yeah so like when moon i don't know when moon we're just on a we're just on a constant slow trickle towards the moon at some point maybe you never want to get to the moon you just want to always be

striving for it yeah um did you ever mess around like any other cryptocurrencies uh no not really i mean when i started luna i didn't know enough about bitcoin so i thought ethereum was pretty interesting i was like oh you know i can like do smart contracts that's cool But I think the kind of cutoff point for me was actually an article, great article by Jimmy Song about like needing an oracle for smart contracts and the fact that an Ethereum smart contract is always going to have to trust some human element for a source of truth. And then like getting more into the monetary side of Bitcoin. So, yeah, I really only looked at those two and made my way to Bitcoin pretty quickly. Are you hopeful for Ethereum 2.0? Sure.

I wish them well. honestly good luck this is uh that's actually something i was talking about with elokai off the record after our last uh when we recorded last week off the record now no i mean we we said we should have talked about it on it uh ethereum 2.0 he he made me aware of uh what's it called the second system syndrome uh basically uh referring to ibm in the 80s they would try to makes uh they try to remake their their system from scratch one of their systems and it turned out just like never coming to fruition because they were always specking it out and new things were getting added and they eventually just stopped working on it because it never launched

and it was taking way too long and sounds about right yeah and that's uh i mean i don't want to pick on ethereum here but that's i do not think e2.0 will ever launch yeah no me neither and that's just my thought just interjecting here at my uh my bias um yeah it's uh it's crazy because there's so many so many different ways to approach uh this problem at least it seems now or that people are trying to approach it in different ways your mics there you go perfect um but and that's so that's one thing i wonder about a lot too like how many more altcoin cycles and ico bubbles are there going to be like at what point is bitcoin's liquidity and network effect just sort of trump any uh inclination to even launch a competitor yeah i don't know i think about as well i think

about like you know when when bitcoins got into moon and we're kind of writing the history books hopefully the history ebooks about it like think about the first phase just like okay like the multi-coiner phase and then the ico phase and now i don't know if it's just like my complete bias but it feels like we're in like the maximalist phase it does feel like everybody's a bitcoin maximalist yeah well not a maximalist but like it feels like the kind of rush for new coins and new icos it feels like it's kind of dead it's done and i don't really see where we'd go from here are we going to go back to that i kind of doubt it i think the public has learned people have learned about these you know maybe not so savory icos and they've learned the hard way um but yeah

who knows yeah we'll see we'll see um the market can remain irrational far longer than we we can remain solid so we'll see um is luno and this is maybe like luno is that the moon is that why it's luna yeah so i think it's quite sweet um and if you ever heard of the language esperanto i have yeah it's a dead language right or yeah yeah but it was it was intended to be a language written for everyone so it was one like global language and it's the word for moon in esperanto yeah interesting yeah it's uh that's good like i uh like that's a big contention in the bitcoin community is companies like coinbase and blockchain that use something uh that's sort of tied to bitcoin oh yeah like sats up and stuff like that yeah yeah i think it's tricky

it's even like lightning even like lightning at like it's yeah yeah yeah uh it's all it's all pretty pretty pretty tricky um having some audio malfunctions on tales from the crypt uh what's new what's new yeah um yeah i think in that regard it's hard right like there's two there's two issues in software engineering and like one of the biggest one is naming things so i tend to not be so hard on people like you read even like the stats app they went through a whole bunch of iterations of names um but yeah i understand the concern like i think this same concern sits with the bitcoin twitter handle which is on an interesting journey now and i'm kind of with the people who wish it didn't exist at all yeah they need to shut down the bitcoin twitter

handle yeah who's ever running it yeah and also by the way this episode is brought to you by the so check it out shout out shout out casa um now it's uh it is uh it's fascinating because it's such a raw landscape right now right it's it is a true uh sort of dash for for digital uh and and mental uh real estate right and and trying to position and there's so many opportunities and so many ways in which uh you can try to to build and profit off this stuff that it's presents a lot of opportunity and it's interesting to see how people um go about it or at least they have gone about it over the last decade yeah i think it's really interesting i think it's something i really dig about lightning

is that it sort of opens up new models of business which weren't previously possible like sub-cent payments are incredible like the ability to pay absolutely tiny amounts like that was really like my big light my lightning network light bulb moment where i was like i couldn't have done this any other way i couldn't have made this payment to satoshi's place by card by cash by anything because like my country doesn't even print the 10 cent piece anymore because it's not worth the metal it's printed on um so let's jump into this like what use cases do you see being enabled beyond like satoshi's place shout out satoshi's place yeah um i think that micropayments is a huge one i think that it really addresses like really interesting use cases like people

have been looking at lightning based streaming services where you pay per use instead of paying a monthly subscription i think that people have great um ideas about content delivery in general so there's all sorts of ideas out there about like embedding content in lightning invoice pre-images so once you pay an invoice the content is automatically released to you by the protocol and you have that text or you have that thing i think that's pretty cool and then from kind of a more business standard standpoint i think that refunds is a big pain point that it addresses so uh there's something called a huddle invoice which is a releasable invoice uh implemented in lnd at the moment so you can make a payment to someone say you want to buy some shoes you get

the shoes and you decide to return them they can actually just cancel that invoice so release your payment back to you you don't pay for it you don't pay fees for the payment and then you you know you've sent the shoes back so that's pretty cool as well how does that work is there like a time lock function that's yeah so it's a it's an invoice with a really long time lock um you'd have to have like a two-week limit on releasing that invoice um but within that limit like i think that's a pretty reasonable refund period um so i think that solves like especially having looked worked a bit on our merchant solution where people were constantly kind of struggling with refunds because you have to get the the user to provide you with an address you have to pay

unchained fees there's all sorts of things like that so i think that's a big pain point in bitcoin payments and in payments in general that is addressed yeah then then do you give them back the the equal amount of bitcoin or yeah you do you just release it back yeah yeah no i'm talking about like the the merchant problems you're dealing like the questions that merchants have like do i give them back an equal amount of bitcoin or the usd or yeah yeah at what price or you know sub the fee or don't sub the fee yeah yeah it's tricky one fun problems to try to solve though yeah so much fun it's like one of the fastest moving spaces and one of the most interesting sets of problems i've ever gotten to work on like people ask why do you want to work on bitcoin and

lightning you know people who aren't really bitcoiners are like oh you know it's crazy scary internet money and then you know you say that other engineers you know it's peer-to-peer it's distributed it's it's like every trade-off that you can possibly find in an engineering textbook it's every like difficult problem that you want to solve you get it all you know you get to work on everything and that's that's so great that you can just find your space where you want to work and dig in do you uh do you see more devs coming to this i hope so i think that people like chain code are doing an amazing job getting people in but i do think so i think that you know it's got a lot of sort of hook-ins for people if you're interested in cryptography if you're interested

in distributed systems you know some take someone like gleb he was kind of looking at networks in general and then found his way to bitcoin so i think there's just so much that is interesting about bitcoin that it will draw in a lot of devs yeah no it's i mean just uh i feel very fortunate having this this podcast this platform and having been able to meet a lot of these devs and some of the smartest people i mean not even some of like the smartest people i've ever met in my life are working on this product on this project on this problem on this mission whatever you want to call it um and it's fast like for somebody who's not technical at all it's fascinating seeing how uh excited engineers get in particular about this because i i'm excited because i think it

brings sound money and that's what draws me in but like to see all the engineers get uh like jacked up about the big problems that they can solve is uh exciting so do you feel very fortunate to be able to work on these big problems yeah what a what a blessing what a what a space to be in like as you say like when the people of the caliber and intelligence of the core devs are spending their time working on this like that's such a testament to the project and to bitcoin itself and it's just amazing to be able to work on it and to be able to be introduced to it with very few blockers actually which i think is really great like people want more contributors they want people to participate and that's been a big part of the ride like a project which is like so

happy to help out and happy to have new people involved like it's just amazing what would you recommend to somebody who's looking to get involved but maybe a little apprehensive a little nervous uh i won't say don't be because everyone's nervous and i hate it when people tell me not to be nervous about things because you're already nervous doesn't help at all um but i'd say do do a github troll that's probably the best place to start there's a lot of small things that people don't have time to get to so a lot of the projects have i mean bitcoin core is really well tagged and get so you go and look at things like good first issue labels on github or you know beginner labels on github because if you are starting out like people will merge really small

prs if it's a first-time contributor and it is like a small fix like you know if you've been contributing for years don't really go and like fix typos in the code no one's going to take the time to merge that but when you're new people will really respond to you it's just find one small thing and do it that's what i did i fixed like an rpc field and lnd because i needed it for a project and once you've done that you kind of like you've ripped the band-aid off and you've done it um the slack and irc channels a great place to reach out to people um yeah what what was the rpc call that you fixed oh i needed like a field i needed a field in a send payment thing for lightning and when the payments were failing they weren't actually returning the the payment

hash so you knew something failed but you don't know what um and we were like oh well this is a bit of a problem if you're running a huge exchange with tons of sends we're gonna need to know whose payment has failed so we just put that pr in thanks thank you you're welcome marty um what do you do outside of bitcoin uh outside of bitcoin uh i'm actually a big sports fan we've got a sport in south africa called rugby which is like really violent football i know what rugby is okay i don't know people don't know he's pretty big over here yeah my high school team had a rugby team okay my high school had a rugby team yeah so i i participate pretty aggressively in a in a rugby fantasy league with my boyfriend and some friends

um proud to say i've smashed them twice out of five years so yeah running pretty well and then outside that i live in a really beautiful city cape town is chocoblock with mountains and beaches so try to spend as much time outside as i can and then my favorite one is that i actually make wine oh yeah big wine out here yeah yeah yeah if you couldn't tell by the uh yeah by the by the stash yeah so i've been doing it with my family since i was like 10 haven't been drinking it since i was 10 but been making it and it's it's a really nice like back to nature thing to do we get the grapes in in big crates and they arrive and we hand destock them and we hand crush them and we go through the whole process and at the end of the year we've got beautiful bottles of wine so that's

that's been awesome for me what varietals do you work with uh so we make cab and shard uh cab's my favorite um and that's fascinating my wife would love this if she was here right now we're big wine snobs if you will um but that's that seems like something very therapeutic like you said getting back in touch with nature we were actually just in sonoma before we did the bitcoin 2019 conference and it's crazy just seeing how uh involved and how entrenched winemakers are with what they're doing and how passionate they are about it yeah it's great it's like it's like i remember someone described to me once it's like having a kid and a science project at the same time because he cares so much about it but it's very very finicky and like we i mean

when we started out i mean i was really young but we were like doing it in someone's garage and they were like rats around and like the first the first vintage tasted like petrol like my dad was the only person who drank it everyone else like this is disgusting and he was like no this is great and like forced his way through it um so yeah lots of really small things that can go very wrong but yeah it's been a great thing to be a part of i'm gonna have to uh order a couple cases no you're gonna have to come visit in cape town together yeah are you afraid the great whites in cape town or i'm not um but like not for good reason like we have a big shark cage diving industry um so it's basically hands by in cape town or off the coast in cape town and people

used to go shark cage diving there a lot and now that industry is kind of shutting down because the sharks aren't there anymore oh really which kind of concerns me because i'm like up here yeah but they yeah they're kind of headed to warmer waters because the temperatures are changing a bit so the sharks are kind of gone which is i'm good with i like swimming so i'm good with it but it kind of sucks for the shark cage divers yeah we've actually had a lot of great white sightings here on the northeast coast in the u.s like up in nantucket and cape cod there's a lot of great whites i'm pretty sure uh i surf so i'm uh cape town has always been on my list yeah yeah it's um it's uh it's very windy down there too right yeah yeah yeah it's crazy windy like i remember

one christmas um there's this old established bar called rafiki's in the corner of one of the big streets and over christmas the rooftop blew off yeah really bit of a dive bar so like of course it happened to them but it it gets very windy yeah that's i do need to make a trip to south africa i mean i'm just talking about this with eric bosco too like i don't travel enough i think i've only been to like five other countries in my life really yeah south africa is a good one to go to it's beautiful it's far from it's a far flight so i was gonna say how long is the flight like 16 hours oh it's long i mean i i took the scenic route here i flew through dubai so it's a 32 hour journey for me um but they now have direct flights from new york to cape town i think it's

16 17 i can't believe you're going back to cape town then israel and back to cape town yeah me neither trust me you're gonna be able to survive that conference yeah jet lag yeah no it'll be good it'll be good um is there anything else you want to touch on we're like an hour in now there's a there's a lot we can go down here like what uh what are you interested that we haven't touched on yet bitcoin related uh bitcoin related um it's okay you don't have to answer yeah we covered it all we covered it all we solved all the problems yeah yeah it's it's um

i guess like what what would you say to anybody who may be thinking about doing a chain code residency next summer oh dear it oh my word don't be don't be scared as well like i was so scared i put the application and i was like oh i'm never gonna get this and then we did the coding challenge and i submitted my my coding challenge and jonas got back to me and he was like carly your solution doesn't like print out the answer you sent us a bunch of like debugging logs as your solution and i was like oh my god i messed this up so badly and i was like oh i'm so sorry and i kind of fixed it up a bit and sent it back and when we got there we were kind of chatting about the interview process and almost every

single person who got in kind of had one of those blunders or made that mistakes and absolutely nobody thought they were going to get it um and here we all are so here you are here you all are doing incredible things for bitcoin and it's crazy how fortunate we are to have companies like chain code right and now square crypto blockstream and others before them and do you see this sort of model that chain code has shown to the world expanding more and more i hope so i hope more people will put funding towards projects like what chain code's doing but i just think it's a big kind of part of what they're trying to do with this residency it's the first run of the longer form residency and what they've done which i think is so great

is that they've put all of the content that we covered up on the Chaincode Labs GitHub. So there's now a full Bitcoin syllabus, a full Lightning syllabus with links, and then everything, every seminar that we attended is going up online. So even if companies don't manage to fund that kind of project, they're putting out those resources

so that more people can use it, and I think that's just great. Contributing to the feedback loop, the more people that know how to develop on it, the more people that can develop on it, the stronger that bitcoin can be so shout out to the chain codes of the world yeah shout out carla is that all we got yeah that's all we got we don't we don't have any whiskey so i think it's all we got i'm sorry i have to drive tonight i was telling you we would we would have been

crushing whiskey if i didn't have to drive but uh yeah sorry sorry uh for the new york city subway system i know that's uh sorry for the l yeah the l's pretty terrible yeah um yeah okay it's uh it's only getting worse too year by year it's not a good sign it's like sometimes in New York I'm like ah god damn it

I gotta get out of this city it's falling apart yeah oh at least there's at least there's public transport right yeah that's true the alternative's pretty

pretty rough as well we don't really have much at all by way of public transport so it's a bit of a mess we just got like people driving their cars and then these like

crazy unsafe minibus taxis which are like you know combi I don't know if combi is a word that American people know

it's like a van a combi is like a car that can it's like three rows in the back um but yeah they've got these like old combis that like ramp the sidewalk and just drive mentally and that's how a lot of the country gets around so it's pretty much pretty much as bad as the owl but yeah i'm sure you meet some some cool personalities on the combis yeah um um that's yeah transportation i wonder if that you think that forces people not to move as much as they would have move around travel um yeah i'd say so i'd say that like tourism in south africa so people don't really go to like far out places and you don't really move like especially when you're growing up there like my mom made me break up with a boyfriend because he lived too far away

and she was tired of driving me there my gosh no not really shame uh was he devastated i wasn't meant to be it was too far i was also over it but yeah so like you just have like much less freedom as a young person like you can only go anywhere if your parents drive you somewhere um i think uber's changed that a lot because uber is very affordable in south africa like the minimum trip is one dollar um and everything's pretty close like nothing in cape town's more than 35 minutes away so that i think has changed a lot but just like having access that kind of transport when you're young i think it really changes things for you yeah be interested to see how it changed the emergence of uber changes economies in place of a bad transportation

apparently they're losing like three dollars in every uber eat so still still that's crazy yeah um yeah carla thank you for coming through cool thanks for having me thank you for working on lightning and doing what you're doing and uh helping educate us here on tales from the crypt yeah great thank you for having me all right enjoy the rest of your night peace and love freaks