0:00 Tomer, a warm welcome back to the Bitcoin Infinity Show. Nice to have you here. Thank you. It's nice to be back. I found this strange phenomenon that I'm reaching out to old friends and saying, hey, you want to catch up? And they're like, yeah, let's do a podcast. So nobody really wants to talk to me one-on-one, but they want me to be on the podcast. So I'll be on a few podcasts. Yeah, but I think it's because I always have such valuable conversations with you. So why not just record them? share them with the world share them with the world so yeah i i guess that's i mean i never intended to become a podcaster it sort of just happened to me right but i figured out that i like it quite a lot because it's it forces me to to uh catch up with people and catch up with my friends and and see how they're doing and like yeah um keep keep circling back to why why you like them in the first place.

0:56 Yeah, that's absolutely true. And it keeps you focused because it re-anchors you in the mission that you've chosen to do your podcasts about. Because once many, many moons ago, I was podcaster too. I got podcast. And it's hard to believe it was all about self-sovereignty. This is like 2021 or something. But I didn't keep it going. No, I remember I had a conversation with Corey recently and he asked me if I tuned in to the cafe Swan thing, spaces lately. And I said, not lately, but I used to be in them when Tomer was hosting them. And he was like, I don't believe Tomer was ever hosting them, but he was always in them.

1:46 Fair enough. There was a period after, this is such trivia, there was a period after Alex Stanzik, who was the regular daily host, took a step back from it, that we were rotating, hosting it one day a week, like four or five of us at Swan. And so to set the record straight, I did host Cafe Bitcoin a number of times. Okay. Yeah. It's easy to mix these things up because there's so much happening over such a short period of time. When I rewind the clock and look back at the last, just the last five years, it's completely insane, like most of it.

2:27 But that's a privileged position to be in, I guess. I'd rather have an interesting life, interesting chaotic life than an uninteresting, non-chaotic one. I've been thinking about that a little bit lately. I think I'm a little bit older than you. I know my kids are older than you. And I'm kind of at the stage where I'd like less chaos in my life. I've had a very chaotic life and I've enjoyed it and I've enjoyed the innovation and the thrill of the ups and downs of success and failure and fear and triumph, I suppose, all of those things. And I don't want to give them up. I don't want to not have experienced them.

3:09 But as I get older, I don't need them anymore. I feel like I've had them. It'd be nice if Bitcoin reached a nice high price and kind of stayed there and I could just travel with my wife and my kids could find normal jobs in a normal life. And there wasn't the constant threat of AI destroying all of humanity or some leader debasing all the currency. Or what else is another imminent Armageddon that we're being warned about? I mean, the AI FUD to me sounds a lot like the climate change FUD, to be honest. Like it's always this the world's going to end kind of thing.

3:52 That's a really interesting tie in because it ties in more than just that the it's Armageddon, nothing you can do about it. It's already, you know, you can live miserably and not enjoy the technology that causes this thing, but it's still not going to stop it. What we were told with climate change is it's too late. there's nothing you can do paper straws the world is going to end anyways but this way you'll be reminded every time you try to take a sip of your drink that with the paper lint in your mouth it's the price you pay for Armageddon of the boomers and the AI thing is kind of similar too whether you use it or not it's coming and it's going to destroy us and we need to limit your use of it but it's not going to save the world yeah yeah but it's so funny because it sort of points out how skewed the perspective is because uh all every all tools or technologies that humanity ever created have the same single purpose they are there to save us time or save someone time somewhere and the only reason for us to fear any tool or technology is that something else in society is funneling that time-saving out of our own hands and into the hands of the few. And that something would be the fiat monetary system. So if we hadn't had that,

5:24 then everyone would benefit from every single tool and technology, including AI and even sentient AI, which I don't believe in, by the way. So are you saying that every single technology has led to, its adoption has led to saving our time with the sole exception, potentially, of fiat money, which has stolen our time. Yeah, well, it has saved time for those people who want to do that to other people, who want to control other people and who want to dupe other people and who want to counterfeit and print money. If you're that guy, then having a computerized money printer that can print digital dollars instead of physical dollars is, of course, a great time saver because now you just have to press a bunch of zeros on a keyboard instead of actually physically printing bills.

6:19 So it is saving that guy time. It's important to understand who the user of a technology is and who the usee of the technology is. With a gun, it saves me a lot of time if I want to kill you. But as the user, it saves me a lot of time and killing you makes it a lot easier. It doesn't really save your time as the usee of it. No, but this is sort of the thing that Bitcoin alludes to by showing the world that the free market is deflationary is that when used properly to just save time for you for not doing aggressive things. if people do that then everyone wins yeah it's it's the simple if we practice doing something do we get better or worse at it and of course we get better therefore all prices should fall forever yeah and they do with the right denominator uh at least hypothetically yeah so i feel like we're going to go back to economics 101 if we keep this conversation going because yeah and that's the purpose of money right it's like you produce something that you're not going to consume because you trade it for something, not the thing you are going to consume, you trade it for something, money, that you're going to exchange for something that you're going to consume.

7:37 And that gives all the possibilities of, I can work writing articles and somebody will pay me to write articles and then I can go to someone who made shoes and someone who runs a ski resort and somebody who... Yeah, exactly. And I can exchange the thing that I earned with all of them. And that's the proper purpose of money. And then the fiat system comes in and through all sorts of rationalizations says, well, we need a central administrator of the printing and of the creation of the money. Who it gets distributed to upon its creation is not who did the work to create it, but who has privilege and proximity to the money printer.

8:23 And this of course begs corruption right It invites people who understand that there easy money to be had rather than fair money to be had And so the psychopaths are drawn towards this thing rather than the honorable individuals who believe in just money money that has justice into it And so we end up on this slippery slope. And then where we are today, I don't know when you're going to broadcast this, but just I think the day before yesterday, Donald Trump promised $5,000 to every American if they vote the Republican.

9:05 is that money it's not money he's earned it's money it's right that's explicitly proximity to the money printer to buy votes and ask every american to cast aside their principle of what they're actually interested in politically for a bribe of fake money it really is quite appalling and unprecedented and and it's definitely not capitalism it's absolute central planning it's not even socialist it's communist behavior and and also the the reason he can do that is that he's exporting the inflation i'm paying for that more than you more than your average american is yes but you realize i'm canadian so i'm paying for it yeah i was about to say that but yeah you saw me stopping myself there so you're paying for it too and i'm paying for it But Americans are not paying for it.

10:00 And it's just such a farce at this point. Yeah, I don't remember if it was Mises or Rothbard that called money a good sugenaris. So it's not a consumer good nor a producer good or a factor of production. But sugenaris means it's for a single purpose only, and that is to exchange it for other goods and services in the future. Which is also why it can't have other use cases, but it's having other use cases actually makes it worse as a good sui generis. Perfect. And that's a temptation for me to compare Bitcoin to gold because gold advocates say, well, look at all the industrial and jewelry uses of gold and you can use it with your teeth. And it's like, well, so then that's what it should be used for. We should have an exchange, a single use product, a commodity whose only use is exchange. It can't be consumed. It can't be used in an industry. And that's really what Bitcoin is.

11:02 And it's better at the single use purpose of exchangeability because it's uninflatable, it's unconfiscatable, it's uncensorable, it's permissionless. It's got all of these things, none of which are true about gold. And it's teleportable. I think that's pretty important. It's back up a bowl. It's actually, it's not even in a single location. You know, if you have a multi-sig setup, the Bitcoin isn't, you can argue it's on the blockchain, but the blockchain isn't in any single location. No, no. Or you could actually say the Bitcoin isn't in a vault. It's like one of three keys is in one vault, another is in another vault, and until you bring them together, the Bitcoin cannot be moved.

11:44 So that's better than keeping your gold in two safes, where if one safe gets compromised, you lose half the gold. If you keep your Bitcoin keys in three safes and they're multi-sig, if one of the vaults get compromised, you've lost no Bitcoin. Now, I bet you've heard my argument around this, that whatever's on the time chain is not the Bitcoin, because it's only a historical record of what happened to them. So the actual important part, the important aspect of the Satoshi is your ability to move them. And that always lives in a human being's head, either if it's the actual private key or the location of a hardware wallet or a ping code doesn't matter.

12:28 It's always just a secret that you keep from other people. So in effect, the important part, the important aspect of the Satoshi lives within your head, meaning that we are the Satoshis. And this is my mindfuck, you know, armchair philosopher. I think you take it a little too far for me, which is not, you know, because we could argue, we could split hairs and get into what I would ultimately say fallacious or context dropping arguments around like I could say well if I put the information in my head on the blockchain then now now has the bitcoin actually moved and moved onto the blockchain but I think what's more more important is if you're thinking about now when two people are talking about exchanging bitcoin because we said it has one purpose And the purpose is not to pontificate about it on podcasts. That's an accidental secondary purpose. The main purpose of it is to exchange. And so when it comes down to if there's an exchange, if I'm going to send you some amount of Bitcoin, we don't really care if that's in my head or in my keys or on the blockchain.

13:46 We care that we can affect the change on the blockchain where the address you give me is going to end up with the amount of Bitcoin that I said I was going to send you. And I need to know how to affect that change on the blockchain, which comes from something from my head, I know. And the access to the keys, which I don't know. They're stored in multiple locations. So I have the know-how to go and access them, but I need to access them. And then I need to do this and that. So it's all of these things, right? And with all of these things in place, if you know how to generate a receive address and I know how to send my coins to that address, we can exchange Bitcoin and use it for its sole purpose.

14:30 Yeah. And I think the saying that you own them is slightly wrong, too. You can act as if you own them if you think that the probability that someone else has access to the same key is low enough. And also the other thing you have to believe, which will lead us into the thing I want to talk about for real here, is that you believe that the system won't change to such an extent that it would lose its value. Then you can act as if you own the Satoshis. yes so the thing but the thing i really want wanted you on to talk about is is the aftermath of bit 110 here because i i want to to interview as many of my friends as possible about this and and how they uh how they think about how they thunk about the fork before it happened and what they're thinking now afterwards and i'm interviewing people on both sides so to speak I think there's more than two sides.

15:28 Yeah, yeah, but so do I. I had a great conversation with Giacomo this morning. Yeah. And I'd love to hear your view on what happened. And you were pro the fork, as I remember, but simultaneously didn't really think it would happen. Maybe I'm putting words in your mouth here. You know, emotions and decision-making wavered at various points in time. I was, I think this thing took place in four or five stages. And there was stages that I was semi-committed to and stages that I had nothing to do with.

16:09 Like initially there was the concern about the, the first stage was reservations or opposition to core V30. I mean, there were changes that were being made and whether those changes were technically sound or not, there was the how those changes went about and the dialogue that went about it. That I was very infuriated by and I felt that there was dismissal of conversation and things like that. That evolved into stage two, which was run knots and I ran knots. I'm still running knots actually, the old version of knots on this laptop here that I'm speaking to you from And that was, let's through policy send the message and which node we run, send the message that we don't like what's happened and we're opposed to it.

17:02 And I was quite on board with that. And I think for not necessarily for technical reasons, but for philosophical reasons more than anything else. Then came the BIP movement which was a soft fork And although I understood I think where that was coming from I never signed on for that although I did express sympathy for it because it was sympathetic to what are you going to do now that running knots well I think I felt that the move to dip one to recommending a soft fork from the momentum that knots had was probably an error I wasn't sure I wasn't really involved in the movement in any meaningful way, but there was continued momentum of people running knots.

17:49 And I guess I wasn't as concerned about the urgency to impose a change in Bitcoin. And I would have been pretty happy with a lot of people running knots, creating a check and balance on core and knots as well. So, but then BIP 110 came. I didn't run BIP 110. And I expressed sympathy or understanding for it, some sympathetic views towards it. And then it, it didn't succeed. And then the hard fork came, which I would call, I guess, the Blake, the Blake proof of work, hard chain fork. And I haven't said a thing about that because it's already two or three steps removed.

18:35 So I, I think this movement escalated, um, and escalated in a way, I'm happy to answer specific questions, but escalated in a way that forked itself off of Bitcoin, which was, which is very unfortunate, because I think people leaving Bitcoin for another coin is, is mistaken in all kinds of ways, which we can get into. And, and it's good people, for the most part, who, you know, at least for as much a part as the quality of people in Bitcoin. And I lost the thread of why go why keep going on with this, especially as it moved into the hard fork territory and and some of the rhetoric around it right now that it's the real Bitcoin is like it's just too familiar to for previous hard forks.

19:33 Yeah. So given that so many good people have now left legacy Bitcoin, if you will, do you think how much of a worse position is Bitcoin in general? Like, is it as robust as it were before the release of Core V30, given what happened afterwards? Well, I think it is actually, you know. And it's why I hope people, I don't know whether people will come back because there's philosophy, there's ego, there's all sorts of things. But this wasn't the only thing that happened in Bitcoin. Around the same time, we had other major events happen.

20:19 We had the cold card exploit, which was an exploit of entropy generation of hardware wallets and a hardware wallet with a very good reputation, perhaps the best reputation at the time in Bitcoin. And the reaction to that was a real strengthening of Bitcoin. people who had taken a lot for granted, trusted, cold card trusted developers who were on both sides of this issue, if we call it a two-sided issue, but more so on the not-nots camp, not-bip 110 camp, really stepped up to explore exploits and fortify things.

21:06 And then even more recently, we've had this hack of the liquid side chain. And I think that's caused people to want to be more diligent at the code level about what exploits are and aren't present that could lead to loss of funds or loss of confidence and conviction. And I think that that's really much more meaningful than where this debate ended up. This debate ended up on a governance style issue. And I think the side that was critical of CORE, we'll just call it that, take all those people and put them on one side, actually scored some significant victories.

21:56 They raised awareness for the fact that it's a small group of people. They raised awareness over the hiring process or the appointment processes that took place. And all of this raised awareness actually will prevent those things from occurring again in the future, especially if the same people are around and vigilant and concerned about it. And so there's a part for me, which is, I think, I think, I don't know what the war is, but I think some battles were won and some battles were lost. And the decision to secede from the Union, because certain battles weren't won, is not a decision I concur with.

22:42 no i i've agreed i came to the same conclusion quite early like two days after the uh the failure of the fork i realized that uh now the job is to keep people on on the main chain because as many the more people who were uh on the like not undecided about whether to fork off or not the more people we can keep in bitcoin of those people those hardcore based bitcoiners the the better off bitcoin is yeah so so it's the the reverse red button blue button scenario where now the blue button is stay instead of the blue button is go with the software right so so so so that was to me that was pretty pretty clear and pretty obvious quite quite early on because also like understand why the miners could make the decision they made because bit 110 was not economically significant enough like uh the 5 000 new nodes probably didn't have very much activity on them since uh since they were from these new sales records from start nine and so on so yeah and concerning the cold card hack and and the like not your keys not your coins like it it also means not your entropy not your coins like and and while cold card the company had a good reputation i i I think their CEO had a bit of a questionable reputation, at least in some circles.

24:13 And they've lost all their reputation now. I mean, they're doomed, which they should be because they lost people's funds. And they had one job, and that was not to lose people's funds. And now they've lost. Yeah. So I think they're doomed. They're done. It's interesting. It's like they made, the analogy is tough here with brands, but they made the most feature-rich Bitcoin-only hardware signing device, and they screwed up step one. The one thing. The one thing. It was the default setup, the default out-of-the-box setup. And so only advanced users still have all this amazing functionality, and maybe it finds itself some kind of home in some situation.

25:00 Like, the dust has yet to settle on a lot of these things, right? One can say cold card is finished, but I understand. I haven't been to their website, but I understand they're still selling devices and that there's still demand for it. I wonder who buys those. I mean, would you buy one at this point? Well, provided that I could verify everything that it's doing, there's a lot of things that I liked about the cold card, actually. And they looked cool. and they made it easier to input dice and they made it easier to use a whole bunch of advanced features on bitcoin and they had a the state-of-the-art one the q the molecule had like a laser scanner that you could scan uh the upc codes and had nfc and it had battery operation or power operation So it had just a lot of flexibility around it And I someone who very careful when I spend Bitcoin Like I don just sign a transaction and then send it I decode it and review it on an offline computer to make sure that the change address is the right receive one, one, and the send address is the right one. And that's been beneficial to me because I think there were times when I actually made human error and accidentally like sent my whole stack to myself or somewhere. I'm not sure exactly what happened where, but I never broadcast those transactions and they're like, well, did I click the wrong buttons or what have you? So

26:31 there's something to be said for a really good display. I'm not saying cold card's the only one. I think that there's lots of others, but I can actually understand why people who are familiar with it, who flashed the hardware and who are going to verify everything that they see signed on it will continue to use cold cards that they've had and potentially even buy more. And if there's a change in ownership and a change in government, this is the thing. The analogy is, does one mistake warrant abandonment of the entire thing, or does it warrant correction? Well, it depends on what the mistake is, I guess. Yes.

27:11 Great. Right. But I ask that question both as it relates to Core VEAST 30 and Coldcard, right? Yeah. Yeah. Yeah, that's a good point. And as far as liquid, liquid was never Bitcoin. This is a lesson for people that anything that isn't a Satoshi, really anything that isn't an on-chain Satoshi with maybe an exception for the Lightning Network where you actually... For self-customer Lightning. Yeah. Yeah, so anything else is really not to be trusted in the same sense as the Satoshi, I think.

27:54 And I think this is like Bitcoin is not for everyone. It was never for everyone. It's for anyone, anyone willing to do the homework. And so I guess my question to you, there's always going to be this tradeoff between usability and I guess safety, because the more you know kind of thing. Like, will this always be a hurdle too big for mass adoption? I mean, I personally don't really know if mass adoption is, mass, you know, self-custody adoption is even necessary. I think it's necessary that most clever based moral people in the world who are going to change the world, that they use Bitcoin.

28:38 I want that. But is it even possible, given that there's always a tradeoff between comfort and security here? It's a tough question. It's a tough question. In various points in my history, I would have answered with a lot of confidence and conviction one way, and then at other points in the other way. And I have to admit, I'm confused right now because I can see the hardware getting easier and easier and easier as people improve it. I can also see people getting more and more concerned about it and there still being easier and easier and easier ways to custody and better custodians over time.

29:20 The quality of the custodians will probably get better as well and so they'll have their value proposition and others will have, you know, and self-custody solutions will have their value proposition. If you press me right now, which I think is what your question is doing, I would say, yeah, I don't think we're going to have worldwide mass adoption of self-custody and we don't need it. We're going to have worldwide mass adoption of Bitcoin. And that's not coming tomorrow either. But we'll have a battle of custodians who are more transparent and more reliable and more auditable. and we'll have improved solutions for self-custody that are also more reliable and more verifiable and easier to use.

30:09 So we're just moving in the direction of technology, which is always better, faster, cheaper, easier. And we'll see that happen both in self-custody and not like... There's already some really slick-looking, easy-to-use solutions that are still early. so you might be hesitant to use them on the basis that you don't necessarily want to be the first person to store your entire stack on a frost wallet on those frost wallets that snap together that look like little iphone minis but that's a really slick solution i think they should have called it the human centipede wallet yeah that's so that's why nobody's gonna hire you as a marketing vp i guess so yeah yeah change the subject maybe before before we say anything more about that so yeah all the hacks uh it was also btc pay server uh that went down and bolts um all of these things uh do you think like um how conspiratory do you tend to be in situations like this do you think that there's a big master plan like is there a chance that there is no i i I mean, this to me is, Occam's razor explains this one.

31:27 All these hacks occurred right after these advanced AI models came out that were explicitly capable of probing vulnerabilities and exploiting vulnerabilities. And so it's no surprise at all that every one of these hacks occurred within a week of the release of one of these frontier open weights models. I don't think that all these things were known and then multiple parties or a singular party rung the bell and that they were all exploited all at once. And I think the important takeaway is as gut-wrenching as it was to have all these things happen in quick succession, every one of these attacked platforms got stronger.

32:20 as a consequence, right? The cold card is fixed and audited now by many people who've checked it. And there's been a whole movement to create this entropy evaluation solution that's been developed open source live on Twitter spaces with, you know, people popping in and out, creating it and checking each other's code and checking in and checking out. So I think Bitcoin is anti-fragile. and you've seen it in these things. It's like when it gets attacked, the consequences, it gets stronger. And in the same way as when you get attacked, you are prepared for that attack the next time around. And you're thinking about other attacks you might be vulnerable to.

33:03 And that's exactly what's happening in the Bitcoin community. There's a lot of time and energy being spent on red teaming and testing things and a lot less trust and a lot less naivete going into it. So it may be one step backward, but it's in the process of creating two to ten steps forward on security. And every one of these things, whether it's the fork of Bitcoin or the attack on cold card or the attack on elements or the attack on BTC pay server, actually ends up when the dust settles, which doesn't take too long, with a stronger version of Bitcoin. A Bitcoin that's aware of, and a Bitcoin community that's aware of, what vulnerabilities existed and how not to succumb to those vulnerabilities again in the future and the severity of those vulnerabilities so so um if you compare that so so yeah i i would agree that these attacks like these uh inevitably or eventually turn bitcoin strong makes bitcoin stronger because it's sort of like, yeah, we're resistant to that type of virus now.

34:13 It's sort of vaccinating Bitcoin for lack of a better term. But if we take another attack vector, like also closer to the BIP-110 debacle, so if we now lost a lot of good Bitcoiners in that fight, is there a bigger risk for a cultural slippery slope where, because we lost a lot of the monetary maxes, right? So the people who understand that other use cases make big coin, worse money. So if a large portion of them are now forking off, is there a chance that Peter Todd's demirage thing comes in or the OFAC compliant transactions only from now on and all of these cultural attack vectors, are they stronger or weaker? I don't think so. I mean, I think inflation through demurrage or seizure of Satoshi's coins or stuff.

35:15 There will be some kind of conversation that would have been inevitable, even with the monetary maximalists in here, who now are no longer and who perhaps are standing outside saying, see, I told you so, for when those conversations take place. I don't think that there's any greater risk of those things manifesting. I think the overwhelming majority, even of people who weren't monetary maximalists, is Bitcoin is money. Their argument technically was you can't stop spam, so don't bother trying. Let's focus on other things. That was overwhelmingly their argument. So if an argument comes in to diminish Bitcoin's ability to be used as money or to diminish its monetary characteristics, I think that those won't survive the test of the necessary soft fork or hard fork to implement them.

36:15 And what was the other side of the question that you had that was the demuron? Well, let's dissect the first one, because I think that the BIP1 centers, like one of the arguments would be that these other use cases, whatever they are, the spam use cases actually do make Bitcoin worse as money because of the clogging the chain and therefore making the initial block download costlier. So it's a forever vector that is worsening, objectively worsening Bitcoin as money, both as a store of value and as a medium of exchange, if you zoom out long enough. Yeah. So it would say that these things are actually, you know, maluse or whatever.

36:58 I guess when you compare, and this is where having had a hard fork, so having a parallel universe with the monetary maximalist extremists on it is already demonstrating itself to be technologically very difficult to enforce. There's a mining pool that has too much hash power. They're trying to get them to have less hash power, which doesn't make sense. Because if they pretend that they have less hash power and hash is another miner, they still have the hash power to conduct a 51% attack.

37:40 So it ends up becoming about appearances. And you're just in this back and forth. I think we have to live with the reality that there are irrational non-monetary uses of Bitcoin that sneak under the possible prevention schemes that can be imposed. And that's the lesson that many people were trying to tell us. And they've made their point. and there's nothing that really can be done about it.

38:23 And when you say it makes Bitcoin objectively worse, it's like, it's a teeny, I'll grant you that it makes it worse, but it's only a teeny tiny, teeny, tiny, tiny, tiny, tiny bit worse. And it doesn't mean that I can't use Bitcoin as money anymore. It doesn't mean that the time chain is too expensive to use. It doesn't mean that my access is permission, is permissioned all of a sudden. It doesn't mean 51% attacks. All it means is I need a little bit more hard disk space, which is very inexpensive to run a full node and maybe a few more CPU cycles. And so I've had people come to me and say, like my Raspberry Pi 4 node with one terabyte hard drive died as a result of the spam, and it wouldn't have died if it wasn't as a result of the spam.

39:10 And it's like, okay, that's the example. but if you have a piece of hardware that costs more than $50, you're able to withstand it. I actually, my start nine node died the day before yesterday. I think it was, we had a couple short power outages and there was a power surge. So I think the power surge took it out and so like the power surge was more dangerous than all the spam for the survivability of my node. And now I have to rebuild the thing. And ironically, I took all my, I, I had fun sitting on it in lightning and I swept them all when all these attacks started out of just an abundance of caution.

39:54 Cause I was thinking, well, you know, I'm keeping material amounts of money in a hot wallet. I'm going to swipe it. So I moved it to cold storage and then, then the thing broke. So I dodged a bullet out of sheer luck again, or for the wrong reasons. I did the right thing for the wrong reasons. But I just, I don't think, like, I think we need to be united on Bitcoin as it is. We need to accept that it has the limitations that it does have. And then we don't want to compromise those limitations, the most important ones, in exchange for nice-to-haves. And the nice-to-haves can't even be had. You know, they come at such a cost.

40:36 Like I wouldn't want to be, and I guess I have the choice, right? And so I, and I'm not on the hard fork side of this thing, because I think, I think, I think what is given up, not just in terms of the price of the coin, the liquidity and awareness and network participation, but in permissionlessness and censorship, resistance and predictability of the future state of it. Like once you hard fork, you've committed, you've, you're on a path that will entertain future hard forks. And every one of these things that you have raised concerns about require hard forking into the future.

41:19 So I know there's people who are going to be listening who are angry with me for not taking that side. I think you actually won. You didn't win wholeheartedly, unequivocally with an unconditional surrender from the other side. And to be honest, you didn't deserve to. It's not because you're bad people. It's because there's truth on both sides of this equation. And if you eat only one part of the truth and not the other part, you're leaving out a very important aspect. So Bitcoin is still fine. It's unfortunate that it's got all these op returns on it, but it's not fatal and it doesn't diminish its ability to be used as money.

42:08 And Bitcoin is stronger because of all of the attacks that have been there. And you can see, you know, you can take your time, especially for people who haven't dumped their Bitcoin. You can take your time and see what happens over time. But Bitcoin is getting stronger and staying part of the unity, even if it's got people you don't like in it. That's always going to be a part of Bitcoin. Bitcoin's always had people we didn't like. It's always had scammers and crooks and drug dealers and drug users, if those are people who you don't like. And it's open for anyone, including people you don't like, including people who are going to do with it what you don't like.

42:57 But the reason you're in it is because no one can stop you from doing what they don't like. And if what you like to do is use it as money, you can use it as money. And nobody's going to stop you from doing that. And there's so many layers of engineering improvement and fairness in it that if you start to fiddle with some of them to limit how much op return data can be stored on chain the consequence is you start to compromise those other aspects of it and i think that a lesson that being learned through the experience of the hard four yeah um i remember a conversation we had on madeira uh where where you talked about how the block size wars was a battle we won.

43:46 It was not, we did not win the war. We showed the others, or big Bitcoin, if you will, that we could win a battle, which we clearly did. And it was the thing that made my conviction like ironclad because I absolutely loved how it played out. All the big money in Bitcoin didn't have anything to say because what the plebs wanted is what won in the end. So given how the latest fork played out, has your memory of WIP-148 and the user-activated soft fork back in 2017 changed?

44:28 Or do you still have the, like, was our view or our memory of that too romanticized perhaps? A little bit. Maybe. You never really know. Our minds are finite and they're limited in what they can hold and we cling to narratives of what happened. Sometimes we oversimplify, sometimes we never got right in the first place. History is written by the victors. There's all these sorts of things. So we don't have a perfect image of what happened. We like to think, you know, we had BIP 148 and we ended up with Segwit and not the hard fork.

45:10 The truth of the matter is, you know, and I think we definitely won a spiritual battle that endured for years against what were the big corporate people who thought that they ran Bitcoin via, you know, a meeting in a New York hotel. So there's no question that they're not going to try to do that again and that they can be stopped. But the likelihood of the success of the hard fork, there was a proposed soft fork and a proposed hard fork. And big Bitcoin at the time, the New York agreement, said we'll do both, which is how they lost. And so it was a self, it was an own goal because to do a hard fork, you need everyone to, to change their consensus rules. It's not backwards compatible. It's backwards incompatible. And, you know, and we, we, we've seen hundreds, maybe thousands of people embrace the, uh, the BIP 110 or Blake hard fork.

46:14 I don't think we saw anybody embrace the SegWit2x hard fork. It didn't even fail to activate, if I recall correctly, because they only had one developer develop it. But Bitcoin Cash came out of it, which was a hard fork that Roger Ver and Jihan Wu were behind. And it had a lot of momentum at one point that seemed to go. But it's ultimately a loser. So, we can take these lessons in a bunch of different ways, and I don't mean to cast a final verdict on the Blake Proof of Work coin yet, but it's off to a slower start than Bitcoin Cash was, because it doesn't have such big economic actors as the largest mining equipment manufacturer and the richest Bitcoiner going on here.

47:12 So there are similarities, but there's also big differences. But the differences that make the hard fork look in a tougher situation. So for me, there's a technical analysis on this, which is to say hard forks are extremely difficult. There hasn't really been a hard fork since Bitcoin has been of any size that has had any likelihood of winning over the Bitcoin community. What was the last one? Like the inflation bug or something? Yeah, there was an inflation bug very, very early on in Bitcoin's history. I think that was the only one that could even be considered to be called a hard fork. And it was like an inflation bug emergency when the community was small.

47:55 Now we've got a huge community and people are trying to do it for reasons of bigger blocks, smaller blocks. I guess one was for bigger blocks, one's for smaller blocks. I hadn't quite appreciated the distinction there. But that's not enough to move the entire community to generate consensus. For a hard fork, a hard fork requiring everybody who's participating in the network to change their consensus rules. A non-backwards compatible upgrade. Now, if you're running a node and you don't commit the hard fork code, your node ceases to find blocks on the hard fork.

48:40 because it violates its, the hard fork violates that your nodes consensus rules. So it's just, hard forks are really, really hard and you need, you need a overwhelming, overwhelming majority, like super majority of nodes to participate. And you need a case, so you need an incredibly strong case for it. And a case that's trumped up or a case that's not convincing enough is not going to move people to a hard fork. That's one thing I would say. If you're asking about the block size war from 2017 again, it was maybe that the hard fork side was doomed to begin with.

49:24 And although we were doing, we might not have gotten Segwit, but we certainly weren't going to get the 2X thing because so many people were opposed to it. And... I'm happy to take a follow-up question. I feel like I've been speaking for 10 minutes. Yeah, yeah, yeah. So, yeah, this is, I mean, it's so fascinating though to me with a hard fork because you're right from a certain perspective that it requires everyone to upgrade or everyone to change the software. But from the perspective of a person who is hard forking, voluntarily regardless of financial repercussions from doing the hard fork it doesn't require anyone but yourself to like if you're fine yeah you're welcome to do yeah i mean when you step outside if you step outside of the arena into the spectator seats and see what's going on you know like you're seeing but you see hard forkers as a very and there's two teams on the field the hard fork field becomes this very small segment of the field and everybody else remains on there.

50:43 To get everyone to, like, at the end of the day, yes, you're free to be a part of whatever community you want, but money is a networked, single-purpose-use thing. And if you're on a different money standard with a different commodity that is incompatible with the exchangeable commodity that everybody else is using, you may have, you may have mistaken principle for purpose. And I think there's a hierarchy of principles here, right? Like, you know, if you want, and it's where this notion of perfection becoming the enemy of the good can rear its ugly head. If you place the principle of no operaturns above the principle of being part of the largest monetary movement in the world with the greatest momentum and all these other attributes that we described, you will find yourself making decisions that aren't to the benefit of your monetary purpose and aren't to the monetary benefit of the direction that you've taken.

51:46 So some of the challenges that are going on on the hard fork right now with there being a single miner or a single mining pool that has a lot of hash rate and controversy over whether to censor their ability to blacklist their coins and stuff like that That to me is the example of it time to step back and regain vision of why you actually here and to let go of things that you've misprioritized. If seeing one pool's hash rate too high is a priority for you over the permissionlessness of the participation in mining and the sanctity of the block rewards for the miner through proof of work, I think you've lost sight of how this thing works or maybe never had sight of it and don't realize that you never had sight of it. But it's probably more than the latter.

52:42 I love that explanation. It's a hierarchy of principles. That's exactly it. They're evaluating principles that should be subordinate to more hardcore principles. So it's a beautiful way of putting it. Let me try to explain, because I know that I didn't know this until a couple of years ago because I never thought about it, but how a miner proves to a pool that he has the hash power that he says he hashed or that they say they have to use correct language here. So I guess I envisioned it as just the miner pushing through all the hash power through the internet cable, but that's not at all what happens. What they do is that they mine on blocks, imaginary blocks with lesser difficulty.

53:34 so so so they find these uh semi-valid blocks that are only valid as proof of their hash that they have the hash power that they said say they have and then they provide those blocks to the pool so they can get the payout that yeah they're due but the other way around what's happening on the blake 2b chain now if i understand it correctly is that there's this one miner who says he has this that his hash power is low when in reality it's higher than he says it is and therefore he can it's easier for him to do a 51% attack or take over the mining so therefore this centralized team has to like stop this guy is that is that sort of how you see it almost but maybe i'm wrong about the details i think just explaining to people the first part of your point the technical the technical part, right? Let's say, I'm going to make up an arbitrary numbers. Let's say in order to do the proper proof of work, for Bitcoin to say your block is valid, you need 20 leading zeros in the hexadecimal of your hash. So to prove that they're, how much work they're doing, miners submit things that only have 16 leading zeros to the pool. Say, look, I found something that's 1 16th is easy or one one hundredth is easy.

54:55 So I didn't find a block, but I did work. I use proven work. That's one one hundredth as hard as has the block. So you can see I'm submitting proofs of work that are equivalent to one one hundredth of a bit of a valid block. And so they're able to demonstrate that. So that's, that's the first part. I don't know exactly what's happening on the Blake to be side. I'm not like, I'm not in the discord group or following. I'm just seeing things that people are posting. I just heard one miner has too much power. Yeah, and usually it's, so like I've been to their mempool explorer here and there. I think you've got someone who's got more than 51% hash rate.

55:38 And that's in part because they're new and there's not a lot of people have added hash rate. But as far as I understand, and I'm pretty confident in this claim, They haven't 51% attacked the network. A 51% attack of the network is essentially ensuring that you have all the blocks because you're ignoring the other blocks of the other miners. Or you're trying to double spend by sending someone some coin and then writing over that block and replacing the transaction that you sent to them with one that you sent to yourself. So there has not been a 51% attack. There's the possibility of a known actor potentially exercising a 51% attack.

56:21 And so now there's a group that wants to discourage that. But what we actually have here, like you don't encourage a free market through central planning. And if there isn't enough demand from other miners to mine the coin in the face of this potential threat, then it's going to be a failed project, a failed coin. You know, declaring that there's already too many centralized miners in Bitcoin and then trying to prevent individuals from mining by threatening to freeze their coins through some central authority is not a decentralized solution to a problem of encroaching centralization and fear.

57:12 So, again, I think this is where I'm not close enough to it, so maybe there's rationality behind it, but it feels like it's a very knee-jerk reaction to a quite anticipated problem. And if there's not enough hash power right now, then the believers in that network need to build and acquire and deploy hash power that decentralizes it to their degree of satisfaction. or they need to live with this or they need to declare that, you know, and acknowledge that they haven't succeeded in building a decentralized alternative to Bitcoin.

57:55 And again, you know, I do these spaces on Sunday mornings, Bitcoin Philosophy Sunday, and a few weeks ago or a couple of weeks ago, we did one on, I didn't, and I don't think we talked about the Blake thing at all. Maybe someone brought it up at the very end in their summary comments, but it was all about admitting your mistakes and how hard it is to admit your mistakes. But one of the worst mistakes you can make is not admitting to a mistake because we all make mistakes. And sometimes we make mistakes that other people didn't. And so we feel like, oh, they were smarter than us or they were dumber than them. And so the temptation is to deny a mistake and then get back on a right track.

58:38 You may still disagree with the person who got that right. You don't have to agree with everything they said. It doesn't make that. If you were wrong about something and someone else was right about something, that doesn't mean you were wrong about everything and they're right about everything. But you have to be able to admit your mistake when it's thrust in front of you. And I think this is where, at least from my perspective, and this is a subjective interpretation, I may have been mistaken in thinking that core V30 was not the best thing, but I felt it was the wrong thing. I may have been mistaken that you should run knots. I may not have been mistaken that you should shoot for BIP 110. BIP 110 didn't succeed.

59:18 I may not have been mistaken that the hard fork was a mistake. But that's my view on this thing. And I think if I had the whole thing to rewind again with the benefit of hindsight, I would have said, this isn't the way to fight the fight. And maybe there needs to be a different kind of dialogue. It's hard to know the exact history of the universe. But one of the things that, I'm not exactly sure how we came up to this proof of work discussion on Blake 2B, I think these vulnerabilities, if they don't get figured out quickly, are going to be a historic lesson of why it's so hard to hard fork Bitcoin, even if you're a monetary maximalist and you think you've got righteousness on your side. And you've pointed out there are people who did wrong things on the other side, and you've pointed out that there are people who are malicious on the other side. It's still not necessarily sufficient reason to hard fork Bitcoin and to leave Bitcoin. No, and there's other things that I've heard about this chain, And I got them semi-explained to me.

1:00:27 I've been in some conversation. But for the most part, I've just left that whole movement because I'm not that interested. I'm a happy fence-sitter till anything interesting happens. But I heard that they have just taken the opportunity to do a lot of other things that Bitcoiners have wanted for a long time especially Luke then of course But one of them is reducing the block size, which is something that I've been pro for a long time too. However, if you do it just by, I thought that they just did it though. So Luke made the centralized decision and then they just did it. But apparently it was a bit better than that because they had a Discord vote a poll on a discord thing yeah but but then again that's not how it's supposed to work either you you you you suggest uh this tightening of the rules as a soft fork and then either that software goes through or it doesn't that's how you tighten that's how you make blocks smaller you just don't like override everyone like that so so while i agree with the with the direction i don't agree with the method and this is this is sort of where okay this is where i'm out guys i'm not i'm not on board with this anymore i can't i can't follow along here because while i agree with some of the principles and the goals you have i do not agree with the way you're trying to get through them to them which was the principal objection to core v30 like the principal objection to core v30

1:02:01 was look at how you guys are making decisions. You're opening GitHub for conversation for your friends and closing it for others. You're censoring it. Like, I don't like, I'm objecting to the means more than to the ends. You know, the means are what's important. And so then if you end up hard forking the whole thing and you're using means that are objectionable to the same people who were in your movement to begin with, you've misprioritized your principles. and it is true that the Blake coin community is small enough that I suppose you can run it through and achieve some form of consensus potentially through a discord but that speaks to why but you then have to be humble enough to say okay and obviously we can't manage Bitcoin through a discord with a moderator and everything else so these things are at different maturities of decentralization and for people who are starting a small community with the goal of making it more decentralized and achieving Bitcoin level decentralization at some point in the future, that's fine.

1:03:09 At the same time, there's a lot of declarations and statements that don't resonate with reality around like what's the real Bitcoin and who forked and who didn't fork. And so I just think it's getting harder and harder and it's demonstrating how hard it is to hard fork. Yeah, still one thing that I still believe is that Core did this to themselves 100%. Like if they had been smarter about how to roll V30 out or just not rolled it out at all because it wasn't that important to change filter policy. Like why was it so fucking important?

1:03:50 But the thing is, the blind spot for developers, I think, the way I see it, and when I've talked to developers and listened to how they think, is that they only look at the technical perspective and forget that behind every technical decision of what software to run is a person. And if you do something like this, you will trigger a lot of good people to fork off. And that's not good for Bitcoin objectively. So it might look like a good change from your, yeah, if we make the waste paper basket bigger, then the spam will be less burdensome on the chain.

1:04:31 Yes, but it will also lead to a lot of other second order effects that you just didn't take into account, even though you were warned about them. And that's just unforgivable. So the thing I wish happens, the takeaway I want Bitcoin core developers, the thing I want them to think about going into the future is not how do we make sure that Bitcoin runs as smoothly as possible after observing what happens on chain. Because I think that's how they work now. They look at the chain and see what people are doing, and then they adapt to that. and I think they should have a different approach. They should have the approach Bitcoin is money.

1:05:14 How do we incentivize people to use it as such and not for this other shit? They have a slightly wrong view in my opinion of what their role is. Their role is to keep Bitcoin money not to cater to shitcoiners' needs. Maybe I'm too harsh. I think this was This was a shakeup for everybody. And Bitcoin Core was very hardcore about focusing exclusively on technical priorities and technical explanations. And there was also some behavior that was unprofessional or professional may not be the right word that it was on.

1:06:05 But it was just, it was undiplomatic, maybe. Sorry? Undiplomatic. Yeah, undiplomatic. So the conversation ended up deteriorating pretty quickly. And I guess one thing we have to acknowledge is the conversation can deteriorate very quickly when in this decentralized environment and with no official spokespeople. And so you have various unofficial people saying whatever they want to say and it being interpreted as this is core's position or this is that. And, you know, so we have to learn something from that. I'm not exactly sure what we have to learn from it. Right. But it's like nobody's an official spokesperson for, you know, for any party here other than themselves in a truly decentralized space.

1:06:54 there's no question that if core hadn't been so hardcore about this that things could have been calmed down um i don't know if we still would have ended up in the same place but you know this no there was at one point something that they did back down on which was to deprecate the ability to set your op return filter um all together they wanted to you know remove that functionality functionality from Bitcoin core. And that created a bunch of backlash, which they did step back from. So I do feel like a lot of this is now kind of water under the bridge and we have to watch the current events play out as they play out.

1:07:39 But there's something to be said for developers recognizing what the second order effects of their unpopular decisions might be, irrespective of whether they're technically correct. then I wouldn't therefore say the developer should do something that's technically incorrect because it's unpopular, because then we'll end up in a really bad place. We'll end up with a technically dysfunctional Bitcoin that won a popularity context. I'm not asking for that at all. I'm just saying that maybe refrain from things that aren't that important. So what's the human lesson we learn here? people's egos are so hung up on them being right that they're prepared to take an extreme position that's out of proportion to what's reasonable in order to not admit being wrong. And you've got that in core, not admitting that there's a reason to be concerned about opening up more space for op return by default even though it was doable because of the libre relay and then you've got what to me is an even much more drastic example in hard forking bitcoin over this yeah it's it's lucky lucky luckily for bitcoin they have people like you and i tomer who are not afraid of of saying when we were wrong i mean i i mean i was wrong i've been wrong several times

1:09:09 1986, for instance, I was wrong about a thing or two. In 96? 86, yes. 86? Oh. What happened in 86? I can't remember. And I think I was proven right in hindsight, but yeah. Yeah. jokes aside uh no i i i do want to keep questioning myself because i know i'm not right about everything and i know it's uncomfortable to admit that you're wrong but it's necessary because until you do you know you're wrong you're pretending that you're not you're suffering the consequences of continuously acting as though you didn't know that it was wrong and so you're still making mistakes and you know you're making mistakes it's like stop hurting Stop punching yourself already.

1:09:57 Just admit that you're wrong and eat a slice of humble pie and move on. And for people who won't forgive you for being wrong, then accept that there are people who won't forgive you for being wrong. And for people who say, that's okay, we all make mistakes, you can re-engage in dialogue with them in which you're not defending your position that you know you're wrong about. It should be easy. Yeah. It is. I acknowledge it's not easy. I'd say the thing I was most wrong about this soft fork is its chances of success. I thought it had a bit higher chance of success, but that's not why I was pro the fork.

1:10:41 I was pro the fork for other reasons. I thought it was the more ethical way to move forward, and I think it was such what Mechanic called the milk chocolate soft fork. It didn't do very much, and it would have sent a clear signal to the developers that they're not in charge. Now, in hindsight, maybe that was a bad idea since it didn't prove that. It sort of alluded to maybe we think we have more power than we do have, which was probably a bad thing. So, yeah, but I'd say the trick is, that's the point I want to get to.

1:11:22 The trick is to be able to admit that you were wrong and still move through life with no regrets. I'd say that's a good thing to aim for. Sure. And I think that there's a reflection to be had because like when you're inside the ring, you have a different perspective than when you're outside the ring. But to the spectators, it's not, oh, I guess plebs don't have the power that they thought they had. It's like this group of people fighting over this issue that's a milk chocolate issue don't have the power that they think that they're not going to move the community over a milk chocolate issue. Which isn't that big. Like when you look at it that way and you say like, why didn't you all come with me for a cup of milk chocolate?

1:12:05 It's like, we got our own lives to lead. We're not, we're not having a constitutional referendum over, over chocolate milk and a constitutional reform and a big rebellion over it. And that I, that I think was the, truly the overwhelming majority of people who even managed to hear about it. Right. They were like, this isn't, this isn't that big a deal for me. This, this isn't existential. technical people, financially invested people all hold this point of view. So to the degree that I'm delegating to their opinion, some of this, and this was misinterpreted as, or interpreted as this is big Bitcoin telling you what to do with, with Bitcoin. It's like this, this was not that, this was not that big an issue. And it had to be, it had to be puffed up and inflated to be a big issue in the eyes of those who were on side with this in order to hold water.

1:13:01 But that was based on a lot of like circumstantial evidence or difficult to connect ideas. yeah I still think there's there's something there I lost my train of thought here yeah I can't think of it that's okay I think there's a lot of ad hominem in this debate right like this person's a bad person this person did this thing this person Yeah.

1:13:43 That thing, they're on this side, therefore this side is wrong. That, that I think was a big part of the rhetoric that got a lot of people, um, I got a lot of people confused and got a lot of people to be not supportive of, of the fork. It's like, there's a lot of attack, you know, and it's not that there weren't attacks of people on both sides, but again, he who is proposing the change has to make the case for the change and the case for the change can't just be the person who's opposed to the change had an email with Jeffrey Epstein. No, no. Okay. Back to the thing I was thinking about there, because the reason there wasn't a user rejected software and like the vast majority, you say that they delegated the decision to bigger actors.

1:14:40 but what they really did was that they didn't care because if BIP-110 hadn't failed, they wouldn't have cared either. They would just have, okay, now this is consensus and they would have moved on because there was never a user rejected software. So they were neutral in the sense that, okay, I'm going to let others decide. But the BIP-110 view of that was that since they're neutral, they're not against us, therefore they're with us somehow. But that's not entirely true. It's technically incorrect. Yeah, it is. It's technologically incorrect, right? Yeah. You need them, in order to have, like a soft fork thing isn't an election where everyone casts their ballot.

1:15:24 It's like, it's very, very different. But even just participation in it, it's like you need hash rate and you need nodes to, you know, to make the move. The way I see it like let me see if you disagree with this view because I want to know how correct I am So in order for miners to have to care about the proposed user activated soft fork they will have to be scared enough because of the potential lost fees from the transactions that would have gone through those nodes or to those users Yeah.

1:16:05 And since these were mostly 5,000 newly fired up nodes, I mean, mechanics said so all the time about that. The Start9 has seen record sales numbers and Umbral too. So if I was a miner, I would have made the, like, especially if I was a fiat-minded miner, I would have just made the decision, okay, those 5,000 new nodes, there's no, I have nothing to lose from just ignoring them because there's no activity on them. and i have to weigh that decision against uh the other decision which is a how much can i gain from from actually mining spam which i think is a small thing the other is just uh yeah i talked to giacomo about this this morning inertia like that you yeah it it takes some effort to change your software uh yeah and also the third one is uh yeah your your social status with with big players in the game like if you're a big mining pool maybe you want to have good relations with michael saylor and adam back so so maybe that's worth something too so it's you also to me it's not like right you don't want to end up a minority chain that turns out to be a hard No, no, absolutely not.

1:17:26 Yeah, I think they underestimated all this. And I don't, a Blake 2B person would say that, yeah, but that's proof of capture. If the miners can do that, that means they're all captured. But I don't think that's 100% either way. Like, I think that's, yeah, maybe it's not optimal. Yeah, miners are captured by the consensus rules. and it takes a lot to release their capture. And we want them captured by the consensus rules, except for those of us who want to change the consensus rules. But it's a feature, not a bug in Bitcoin, that it's very fucking hard to change the consensus rules. So we're going to get, like, even, like, it's harder for a hard fork than it is for a soft fork, but a soft fork is very, very hard too.

1:18:13 You need all the miners enforcing it because what happens in these soft forks is, like there's different flavors of soft fork, I suppose. But if you as a miner are enforcing the soft fork on other miners, then, and you're in a minority of the hash rate, then you're going to end up forked off. And that's actually what happened after the first two blocks of, you know, of BIP 110 coin, you just, you fall behind. So your backwards compatibility is irrelevant because nobody's building on your coins and you've lost your reward. So you need to, you need to believe not just that the cause is just, you need to believe that there will be a majority hash rate within a relatively short period of time.

1:18:56 That's a lesson that people learn from this. And so in order for you to believe, like what needs to be true for you to believe as a miner that a majority of the hash rate will go there if you don't control a majority of the hash rate, it's some other signaling from some other of the miners. And that's why you have this signaling period thing. That signaling period activation method got hijacked in 2017 when the miners were meant to signal to activate it because CORE and the community and everybody else was in favor of SegWit and they didn't. So that, and they didn't because it turns out they had, you know, covert ASIC boost.

1:19:40 For people who don't know what this is, don't worry about it. Yeah, look it up. But in this case, it was the miners didn't signal because there wasn't enough support. And that's what was very hard, I think, for the people who were in favor of this thing to come across. And some of the support wasn't there because of FUD that was illegitimate. And some of it wasn't there because it was too milquetoast. And some of it wasn't there because people in principle didn't agree with it. But it wasn't there. And that's why the fork didn't activate when it did with sufficient hash rate to become the new rule set.

1:20:23 And that just is. Whether you like it or not, it is. But it doesn't mean that the miners are captured by big Bitcoin. It means that they weren't persuaded by the Bit.1.10 movement that the Bit.1.10 would be active. and it becomes a bit of a self-fulfilling prophecy in either direction where this thing goes. If they're convinced that it's going to activate, they're going to mine in favor of it, which will lead to it being activated. And if they're not convinced that it will activate, then they're not going to mine for it, which will lead to it not being activated. They're captured by the community. Yeah, I still think that this falling dominoes, you know, scenario, the prisoner's dilemma thing, it is true at a certain threshold.

1:21:07 if the mining pool thinks that the other miner is going to signal, then they might as well just signal. And there is a point. It's not like you don't need 50% for that scenario to play out. So it is easier. You need some momentum. Yeah, you need some momentum. You need more than we had, basically. And it's impossible to say exactly how much you need because it's not an exact number. It depends on its situational. 31.4%. Of course, but yeah, it's great that hard forks are almost impossible to do. Soft forks are harder to do, but a little less impossible, meaning that Bitcoin consensus rules are somewhat less hard to tighten than to open up And that exactly how we want how we want Bitcoin the nature this is part of what so brilliant about the nature and whether Satoshi was a genius beyond our comprehension or built something with such integrity that there were so many capabilities built into it that weren't perceptible at first, but turned out to be emergent attributes of a really well-integrated engineering process or something more profound than that even, or he just got extremely lucky.

1:22:32 But the nature of the design of Bitcoin really is super high integrity and super hard to damage or destroy. To do a hard fork, you need everyone's consensus who's participating in the hard fork. to do a soft fork. And he didn't even create this thing with the notion of, okay, we're going to do soft forks and hard forks. Or we're going to have Blake coin or not, or we're going to have lightning or elements or not. None of this was envisioned. It was just building this really tight system that has all of this integrity between proof of work and how hash functions. There's just such a deep understanding of how hash functions work to use it simultaneously for proof of work and for address identification and in Merkle trees and in block headers and then to create its own currency and completely sever it from and have it be completely self-standing, not attached to any other.

1:23:29 The only other system in the world that it connects to, the only other standard is clocks and there's a block time and even then it's not very hardcore about it. He says, well, as far as I'm concerned, time is the median of the last six blocks. It's not what time stamp is on the block. It's the last six blocks. Take out the top three, the bottom three, and the one that you have in the middle is actually the time as I'm going to use it. And I'm only going to use it for the one sake of the difficulty adjustment algorithm. Other than that, I've got nothing else that's connected to the banking institutions, to government, to anything really. So to have built something that's so standalone and then to address how it needs to come into the world, the coins need to be distributed. Well, to whom? Those who do proof of work. At what rate? According to the block discovery schedule and the halving algorithm.

1:24:29 algorithm and how, you know, and how, how do you have identity? We're not going to have government as an identity system. You don't show your driver's license or your social insurance number, anyone in the world, anytime countries that don't exist yet. People there can participate, people who haven't been born. You generate entropy and your entropy is your identity. Cause anyone can generate entropy. Like, so this whole thing, you know, and so people generating entropy, doing proof of work, distributing the coins, spending the coins, the whole system is so self-standing and then that it's impervious to change. Now, Satoshi did realize this. He has that one famous quote about ever since version point one was released, the rules have been essentially carved in stone. That's a paraphrasing from memory, but it's a close, I think it's a pretty close statement to what he wrote.

1:25:16 And so he could see, he could see that, but essentially carved in stone, right? The word essentially does some heavy lifting there. And, and so we've got this incredible system and I understand people want to make it better. But what's so good about it is that you can't change it. So make it, making it better by changing it is usually making it worse by design and be very careful when you start down that road of good intentions to make something better. there's always going to be opportunity. Like even with, we fought for SegWit. We got SegWit in the block size wars.

1:25:58 In hindsight, maybe we didn't need it. Maybe we should have just kept one megabyte block size because one of the side effects was the inscriptions, which started off this whole thing, which led to this whole hard fork. Yeah, I've thought of that so much. and like I'd prefer like if we thought we won a war but it was an own goal if this own goal is detrimental then Bitcoin would have been better off without the Lightning Network like that's not I don't believe that it wasn't the only way to get the Lightning Network it turned out that there were other ways to potentially implement the Lightning Network maybe with a compromise here or a compromise there but we thought we had to fix a malleability bug but we added block space and we added a witness discount and it's like wait wait wait if we want the lightning network let's fix the malleability bug why do we have to add the block size increase and the discount no there was a lot of compromise with the big blockers so no but you can always be kept in hindsight right I think taproot was an even bigger mistake because it's not at all being used for what it was intended for.

1:27:15 Yes. And adding programmability. I actually think we should have known it, but we were all in such awe and worship of Bitcoin Core developers at the time that we said, although nobody can provide a really good explanation of what an abstract, merkelized tree, master, merkelized abstract syntax tree is actually doing, and there's no wallet implementation and certainly not anything nearly as big as the Lightning Network. We're going to do it because it's been a bunch of years since we've done it, but let's fight over how we activate it. Speed trial, user-activated software, this, that, the other. So we completely failed to say, is it practical that it's going to be used?

1:27:58 Or we're afraid of saying, it doesn't seem like it's going to get used. Maybe we should wait until we actually got some real good privacy features and some prototype wallets using it Anyhow hindsight Captain hindsight again here uh to tell you what you should have done with the, with the benefit of hindsight, what is, is what happened, happened. It's like, you can't change it. It's immallible. It's in the blockchain now, and it's in the rule set now and to deactivate it requires hard fork rather than soft fork. So it's there. Which is probably much worse. And the thing that sold me on Taproot was the privacy.

1:28:42 The privacy transaction would be easier. But still, it's mostly being used for shit. So in hindsight, I wish we would have treaded more lightly and waited a bit. Wait until we figured out the actual privacy. Exactly. But regardless, these are all hypotheticals. like we live in the timeline we live in. We have to adapt to that. And the time chain is still the best representation of absolute truth we've ever had. And therefore the best form of money. And in a way, the saying, I just found Bitcoin and I'm here to fix it.

1:29:24 What people should really take to heart is Bitcoin just found me and it's here to fix me. that's a much sounder way to view reality I think and it's always true yeah and let's take it because this particular fork that we've been discussing isn't from people who just discovered Bitcoin and are here to change it they're from people who've been in Bitcoin for a really long time and have decided to change it but the same holds true you know you've been in Bitcoin for a really long time and it's still changing you I think the lesson it's going to teach is don't change Don't change me. Change yourselves.

1:30:05 Before we close this out, we've been going for 90 minutes plus now, I think. Is there anything we haven't spoken about yet that you wanted to bring up with me? No, I mean, I think this was a good conversation. It's always a good conversation with you, Knut, because we agree enough about enough things, but we disagree about enough others that there's a good form for communication You know, we see things from each of our own perspectives and go at it. So I'm really happy with this. I'm not doing a lot of podcasts lately. I'm doing a lot of personal introspection and personal figuring out what to do with my time.

1:30:46 I'm actually taking advantage of the independence that Bitcoin has given me. It's given me sovereignty, like freedom. People say Bitcoin's going to do this for you. And then they get their freedom. And I think one of the things we struggle with so much, this was especially true for me, it's like, I don't know what to do with freedom. I haven't been free. I've been somebody's wage slave for forever, working for their corporation, working for their shareholders. What do you do with freedom? Do you just go for walks? And so figuring out how to enjoy my freedom. And one of the, I'll just share, this is a final thought. I've had a bunch of these thoughts, so I am now thinking about writing a book, but who reads books? But one of these is just be happy with what you have.

1:31:29 And that's not to say don't be ambitious. It's like in the present, you have something. It may not be a lot, but I guarantee you that if you work really hard with your ambitions and you get what you're after, you'll look back at this time and miss this time when you have all this money or busyness or, you know, successful business, it's like you'll miss the time when you were less busy. You'll miss the time, and depending on one's age who's listening to this, you can think of a time before you had screens available to you, multiple screens, 24-7, everywhere you went. And you played sports in the streets, played board games with friends, didn't have Uber delivering food to you, ate what was in the pantry, prepared the food yourself, went for a walk, went for a bike ride.

1:32:20 and you miss that now. And so you should be happy with what you have because you'll miss what you have when you no longer have it. Whether it's because you've gotten poorer in some way and you no longer have the luxury that you had, but even you've gotten richer and you no longer have the comfort of being less rich than you had, things will change and you'll miss what you had. So just be happy with what you have. Focus on enjoying the happiness of what you have rather than resenting or regretting what you don't have and what you're trying to do. And that's not to say don't try to change your situation for what you think is better, but still be happy with what you have.

1:33:00 That's my favorite words. Those are beautiful words and they resonate deeply with me. It's very close to this notion of that which you can do without your own, but also enjoy what you have, enjoy the moment. Life is what happens right now. It's not what happens in the future. It's not what you had in the past. It's this tiny, tiny intersection between the past and the future. That's everything you'll ever experience. And it's always right now. So every time you don't enjoy life, you miss that moment, that chance. You had to enjoy it. Yeah, absolutely. And it's hard to do because there's always, I mean, there's lots of people always telling you, you need to be different. You need to be better.

1:33:41 I can make you happier. Give me your money and this will be better. It's always distractions. Yeah. Yeah. All right. That's all I have to say today. Tomer, it's an absolute pleasure. I'm proud to call myself your friend. And we'll catch up every now and then and keep having these conversations. I love it. So take care. You too. Take care. Bye-bye. This has been the Bitcoin Infinity Show. Thanks for listening. Thank you.