Thank you, everybody.
I'm so excited to be back at the Bitcoin Builders Conference.
I'm one of the least techy people ever.
So excited to have you guys explain it all to me.
First of all, I want to introduce our panelists.
We have Jameson Lopp from Casa, Charles Mankey from Wolf Financial, Alex Miller from Hiro
Systems, and Paul Sztorc, Layer 2 Labs.
They're not necessarily sitting in that order, but I want to first just really focus in on
the title of this talk, Building on Bitcoin Responsibly.
What does that mean to all of you?
That's tricky.
I mean, there's a number of ways you can look at it.
But I think for me, the first thing that comes to mind is just the fact that what we have
here is a shared resource.
You could call it a platform, if you will, and of course, the permissionless aspect of
it is that anyone who is following the protocol can do whatever they want, even if it pisses
other people off, or maybe even prices them out of doing what they want.
So it's something you could even call co-opetition, in a way.
It's like a lot of us are all working together in the sense that we're building on these
ecosystems and making them more useful and more valuable.
But we're also competing for the scarce resource that is the system.
Co-opetition.
I like that.
Okay.
Yeah.
I don't know.
I guess I'll zoom out a little bit when it comes to building responsibly.
One thing that's interesting, we host spaces all day, and conversations are various myriad
of different topics across people who have failed, succeeded, rugged, and all these things.
What's interesting is in Web 2, you get regulators that protect ignorance for the users, but Web
3 doesn't have that.
So you end up in this space where the moral compass is more important on the builder in
Web 3 than it is in Web 2, because in Web 2, the moral is protected by the regulators.
And that's why I think if you're looking at a leader in Web 3, who they are is way more
important than in Web 2.
And so for me, I think the nature of the person is actually more important than necessarily
how they're building, because there's a lot of ways to cut corners in crypto.
You see it everywhere where people are rugging, hurting other people, starting new things.
And so I just, I think it goes down to the character, the person, not to make it a very
deep thing, but it kind of ends up being that way.
Well, one thing people love about Bitcoin is it sort of returns accountability and personal
responsibility.
Absolutely.
We will dig into some of that, because anyone, like you said, can build on Bitcoin.
And in our current system, we do have this framework of regulators and gatekeepers.
But if you're a freedom maximalist, you believe in free markets, then the free market is the
best referee, right?
Why do you think it's important to build on Bitcoin?
So I think it comes down to sort of a combination of a couple of things of what do we owe to
each other and what do we owe to our users?
The crypto world in general has had plenty of scams and like active, right, active scams.
People, we can all agree that that is bad and you shouldn't be doing that.
But we've also had plenty of people who just obfuscate things in an effort to grow, right?
They don't intend, they don't necessarily intend to be stealing, but they do end up
harming a lot of people intentionally or unintentionally.
And again, I think that's happened, Jameson's point, sometimes it can happen between builders
depending on how resources are being used, or it can be happening to end users.
And so I think that's really the question is, how do we take people who do have, let's
say, pure intentions, they're not looking at this game or anything, but maybe not realizing
what their larger responsibilities are to be building it in an ethical way?
Absolutely.
I think in general, people want the Bitcoin protocol to resist change to some degree,
and they don't want to be beholden to a team of developers who have to decide something.
This is a very interesting and nuanced conversation where you could talk about CVEs and to what
extent are you unable to, if you wanted to just run an old version forever, would you
actually be able to do that?
And Jameson has some great research on his blog where he tries to run old versions and
things like that, which is fascinating.
But I think the overall picture is something like, we don't want people to come and destroy
Bitcoin, Gavin Andreessen had that metaphor about the, you're flying in an airplane and
you want to swap out the engine while it's still in the air or something.
So I do think it's kind of a conservative, it's a conservative technical community and
a conservative user base, and it does want property rights over something, it wants to
actually own something.
So I think that would be part of it.
Christine talked to me a little bit about the challenges of just building on Bitcoin
in a way that provides the most opportunity, but doesn't anger the people that are really
passionate about the blockchain being what it was originally in 2009.
I feel like you have to weave a little bit, you have to carefully manage expectations,
and there are probably some challenges technically that come up as well.
Yeah, certainly I think the soft fork was originally invented like in 2012 because it
was unable, you can look at comments that Gavin Andreessen made back then where it was
like, we cannot reach every user and not everyone will upgrade, but if we do this other thing,
it won't matter that not everyone, we won't need everyone to upgrade the software basically.
This is like a disputed point by some people, but you can talk, like that was back in 2012,
the idea of we will not force everyone to upgrade, we will allow people to just not
upgrade and they'll still be on the same network.
And then since then, things, you know, the standards have been raised even higher of
just like not touching anything, not, now we've gotten to the point, I mean I think the soft
fork is an ingenious way of actually protecting people's, defending the users against developers,
but even now the big phrase for most of last year was like this is being built on Bitcoin
without a soft fork or something, a bit VM where people are like zeroing out bytes.
This is like how far we've come to like not touch this, I think that's kind of an interesting
point.
It's almost an intractable problem though, I think it really goes back to what Paul
said about property rights is that, you know, one of the fundamental, I think values held
by bit coiners and of course this is very hand wavy because we're not a homogenous group,
but it is not disenfranchising people, but I think that if you look at it over a long
period of time of history, you can realize that even if the protocol doesn't change,
the rest of the world changes and how people use the protocol may change and may, you know,
the free market if you want to call it that may disenfranchise people because certain
attributes of these networks and how you can use them will change because new use cases
come up, they may price out other use cases and so now we're stuck in this really weird
place where the narrative of course has gone to okay, we build in layers, but even what
Paul was talking about with soft forks of like okay, we can change the protocol and
do it without breaking people's money and disenfranchising them, even the concept of
soft forking has become somewhat controversial. We haven't had a soft fork in several years
and even though there are a number of really good proposals out there, the developers have
become very reticent to actually run the gauntlet of being a champion for a consensus change
even if it's a backwards compatible consensus change and part of it I think is a lot of
the vitriol that comes from certain segments of the user base that says it's too dangerous
to change anything and then they'll point at different examples and the main thing that
I've been trying to get across is that if you look at how scaling is done with layers
even historically, we had to make changes to the base layer in order to make second
layers possible. At least like with lightning, if you want to be able to have unilateral
exit from some new set of game theory that requires some new rules to it, then you're
probably going to need some new rules that you can enforce on the base layer and I think
that that's still true today. I think a lot of people would agree that in some sense lightning
is one of the only like pure unilateral exit layers that we have and a lot of them you
can't necessarily get out of that layer without asking permission from someone but there's
a lot of possibility for us to build other layers with unilateral exit if we make the
right changes to the base layer. Oh really? So it's dependent on that? Can you help me
as a non-techie person, a non-developer better understand this debate because I see it more
frequently online now, the idea of whether Bitcoin's base layer should ossify or not
and what are the two sides thoughtfully, the straw man, the steel man, can you guys talk
about it? You're the ossification. Yeah, but actually, I was going to say that I wouldn't
think of James as that but you don't, but see it's a very nuanced thing like I definitely
don't think of you as the completely pro ossification guy because of course it is kind of a bizarre
thing. I mean some things we should definitely mention are something like maybe like even
something like as extreme as like software dependencies or something where it's like
if you're going to build a house from scratch, you don't build like the plywood from scratch
or the screws from scratch. So there's all these like people who have built like how
to multiply a matrix or something, these tiny sub libraries that like Bitcoin Core is using
and those people update those all the time, those like Heartbleed, there was that famous
thing where there was a cryptographic library that everyone was using but it had some, it
had a terrible bug in it so it didn't work at all actually. So that would be like a bunch
of people are building houses with these screws and it turns out the screws like you know
didn't work, they're made out of glass or something. Yeah, so favorite was the left trim
on the node libraries where like someone just basically deletes a dependency that's at the
top that has a thousand dependencies which all have a thousand dependencies and one deletion
of one repo basically wipes out thousands of software programs and I think what that
kind of comes back to is like we can get into the debates over ossification, what should
shouldn't happen. I think again when we come back to the idea of like responsibility, it's
about being transparent and honest in what you're doing. You're never going to get everyone
to agree on a change. You're never going to be able to do anything or even not do anything
without some people both disliking it and even potentially being harmed by it or you
know harmed in the sense of like ending up in a worse off place. The status quo is also
not acceptable to everyone and people get harmed by the status quo. So I think that's
where it comes back to like are you being honest about what you're doing and transparent?
I think like there was a lot of let's call it drama around the Bitcoin testnet three
earlier this year and with its performance based on but like since James and you're
involved in some of that but you said very clearly what you were doing and why and why
it needed to happen. It caused a lot of pain for a lot of people like myself included my
company and like because of just stuff we were running on top of it but like if nobody
does anything you're never going to get any progress and so that's why I think it comes
back to the are you being honest and upfront about what you're doing and why so that other
people can make their choices and adapt to engage in it and that's fundamentally it
kind of comes back to that core idea of property rights. So I also see it as it's a 10 year
history now. 10 years ago we were given the promise of side chains of you know permissionless
two way peg side chains and the idea there was to have basically infinitely scalable
ecosystem where we don't have to do everything on the Bitcoin base chain because anyone who
wants to can go create their own other network that you can send your Bitcoin over to unilaterally
permissionless yada yada like upholding all of the ideals of Bitcoin and and we never got that
and as a result we've had call it you know shifts in narratives and sort of coping with
our grapes for sure yeah yeah and so you know there are protocol changes that we can make
that I think would enable us to finally start to achieve a future where the builders who want
to go do crazy stuff can do that in a way that is actually you know cryptographically tied to
the Bitcoin base chain without having to create like a multi-sig federation that of course could
potentially be corrupted and fail. Charles did you want to weigh in? Yeah I mean this topic is so
nuanced because like when we'll host a space of just Bitcoin OGs later two companies will come in
and market to those companies but the tribalism that happens around those companies is so stark
it's hard to change their minds on something they believe in past because Bitcoin represents more
than just the technology it represents like a freedom or an altruism and when people stand for
that it's really hard for you to start messing with it because you're not messing with the tech
you're messing with an ideology and people get weird about that so I think like ultimately like
going into runes you know runes with stuffing transactions and then what was happening is
regular transaction would get stuck in the mempool for six and seven and eight blocks
and they wouldn't come down for long periods of time now the miners get rewarded but what ends
up happening is peer-to-peer regular transfer gets pushed out so and I'm not making a stark contrast
that I believe in either way because I believe if something can be manipulated it should because
just because you have a door to your house and it's unlocked doesn't mean that that's safety
and if there's opportunity for Bitcoin to be manipulated safety only comes by manipulating
it because people always change on the precipice of difficulty like ossification is the idea of like
what could happen but I think the ossification becomes way more at play when they break it
and unfortunately Bitcoin is such a big beast at this point like if we break it it's like
will something come out and replace it if we end up in a position where there's no more peer-to-peer
transfers runes is absolutely taken over regular transaction fees are no longer getting into the
block they're stuck in the mempool forever I mean it's a stark thing but and I don't necessarily
you know believe either way is is like the right way I just um I think inherently you either have
to ossify it or manipulate it until it breaks and then have another Bitcoin well yeah I think
this is a good point of like a similar way I think Jameson you were saying earlier which is like how
like the end user has expectations and needs and like how ossified will Bitcoin be if it is
ultimately replaced by something else that's a that's very that's like negative 100 ossification
you know what I mean is you changed it out of existence by just the user not demanding it anymore
and we have seen quite a few uh you know changes over just a short amount of time you know I like
I've been alive only so long but like there was a time before widespread internet access there was
time before people had there was a time when there was only one computer in every house right there
was a time when before a smartphone so I don't know it's the ossification strategy does seem
like a big risk and I think this is most part of the sidechain's vision was that you could ossify L1
it's very safely in a very sustainable way be precisely because it's kind of a paradox but
really it's more of an inevitability which is like because you need to cater to different people and
they won't always agree and some of them are early adopters and some of them are late adopters and so
you'd have the L1 should be the same and then you'd have all this other new these new L2 things
that would all be blockchains so you'd explore the blockchain space and um you know Bitcoin has
made me think more profoundly about incentives and Alex you brought up the idea that it has to be
the ethics and the morals of the person um but we've also seen controversy over even funding
developers and has have any of you ever worked at a corporation where you've had a mid-year review
anybody yeah you remember those the thing that frustrated me about that is they have to tell
you something they have to find something wrong for you to improve on you will never you could be
the best employee in the world you'll never have a mid-year review that tells you there's nothing
you can work on is there a component of that like if you're funded don't you have to start tinkering
and almost find something wrong and then that is its own kind of corrupted incentive yeah I mean I
think that is the reason that you know some folks who are for I'll just call it pro complete
ossification let's say don't like it and you know yes if you have people looking at a problem
they're going to find something to work on at the same time I don't think reasonable people for the
most part are going to say there's nothing about Bitcoin that needs attention paid to it even if you
don't want substantial changes uh but going back to that idea of incentives which I think is exactly
right people are not going to stop trying to do more on top of Bitcoin I'd actually go so far as to
say it's immoral not to because of how unbelievably tiny and concentrated the user base of Bitcoin is
today like you cannot say that you believe in like the freedom and optionality and power that
Bitcoin provides and say you're happy with where it's scaled out to oh yay we have like a couple
million wallet we have a million wallets that have one Bitcoin on there are eight billion people on
this world right and most of the people who hold a full Bitcoin live in the US which like again we
can argue about the current state of our government and whatnot here but it's a hell of a lot better
than a lot of other authoritarian regime and like the reason that I work on layer two is because I
really believe in scaling Bitcoin out to as many people as we possibly can and we just leave it
locked up with a small group like that group has a lot of incentive to not break the chain and I
to be clear do not want to break the L once but if you've already got ten million dollars in asset
worth let's say on Bitcoin today yes you are going to be a lot less interested in anything that
potentially risks that but what about the person who only has ten dollars on Bitcoin and can't do
anymore because the transaction fees are too high and that's not going to change because people do
want to do new and innovative things on it like if we don't do something to scale it and I think
side chains and is absolutely the way we need to go because it's the only thing that's viable on it
we're just trapping it as a toy you know go back to the pet rock analogy and not actually bringing
like that promise and the freedom that it provides to the people who actually need it that's that's
why I think it's somewhat of an intractable problem and also because both of you have talked about
you know breaking Bitcoin and that is subjective and and of itself depending on what your use case
is and your desired properties of Bitcoin are um but I think if we're talking about responsibly
building uh then we have to understand that we're still exploring the possibilities and so
to say that we should stop exploring possibilities because we might do something wrong I believe
that that is that is projecting from a position of fear and it's a loser mentality and in my view
and and this may sound like overly bullish or optimistic but I don't think it's possible to
break Bitcoin by which I mean I think it's possible to maybe temporarily screw with Bitcoin so that
it doesn't work as people expect for a while but I believe that the the reason Bitcoin works
is the anti fragility and why is it anti fragile it's not because of any one particular aspect
of the protocol or the way that the network works it's because of us it's because there are innumerable
people out there who are either you know morally or ideologically or financially incentivized
to make sure that this thing keeps running and so yeah I mean it's been a decade since we have
broken the network in the sense that it wasn't working for a few hours but what happened everyone
came together they said oh shit we broke it let's fix it so yes maybe we'll have another one of those
things happen if we continue experimenting but the funny thing is that thing not I had to draw but
that thing that was not like a soft fork that's the other thing is these are like unexpected
emergency things that was like an optimization refactor type of switching the database or whatever
so and the other thing the maceralos thing that was also a refactor to shave off like
600 microseconds or something so the bugs are not the soft forks that people the the ossified
people want to like ossify now they want to like do like a campaign and stop the soft fork is
definitely not the enemy of you know ossification I think but it's the those these weird outages
were because of unexpected things so that that's a do you guys forecast potentially having another
block war over something uh yeah eventually I think yes over what and why um well I do think
in general there is a complacency right now that has taken hold and so people think that it's bitcoin
it's for it's a foregone conclusion that bitcoin will succeed and so these people just think it's
inevitable and I think that's actually the kiss of death and see the normally when ossifying people
there are other people who talk about ossification long before bitcoin and they talk about like
there's this famous book the innovators dilemma and there's this other book exit voice and loyalty
these are like famous books Bellagius brought these up at bitcoin conferences so maybe people
have heard of them but usually the story is like the organization ossifies and then it eventually
has to be replaced like there's no there's really not that many stories where it's like it ossified
and then it lived happily ever after that is actually very rare so the status quo is not going
to be I mean you said something very good I thought about like so it reminded me of Satoshi
you're talking about eight billion people we're like we have to go eight billion people or or zero
I think actually and Satoshi Nakamoto has this quote where he says he's talking on the forum and he
says I'm sure that in 20 years there will either be a very large transaction volume or no transaction
so that was obviously you can interpret it in various ways I don't want to get
like into like anything about the block size because I think it's completely irrelevant
because we can have a small ossified l1 block size instead of a large transaction volume on the l2
but I think he was definitely right like either this idea will succeed and you're either growing
or dying I think you know so it's like it's either going to be like the internet where it just
takes over and becomes this thing or it will something else will do that and then this will
just fade and it will be nothing it'll be Esperanto yeah so I mean there's going to be conflicts
and there's there's conflict because the developers who know what they're doing they know what all of
the technical problems with Bitcoin are and for example Rusty Russell has his great consensus
cleanup like there are known ways that adversarial entities could attack the network now and break
it from pretty much everyone's perspective and we know how to fix those things and to throw up our
hands and say no we shouldn't fix them because doing anything is dangerous as you know once again
I think a very silly position to take you know from a really fear projection perspective you
know you made me think of a Bitcoin Core developer Gloria said it on stage that basically a military
attack could bring down the Bitcoin network and we're not prepared yet and people think that we're
in this very safe place and it did it terrifies people who are non-technical and don't understand
the things you do so we're wrapping up now so give us something to look forward to with some hope
here you guys obviously are working on Bitcoin because you think it will succeed right well yeah
I mean my my optimistic take is that you know builders gonna build and you know you can you can
hate the idea of changing Bitcoin as much as you want but you can't stop the builders from proposing
changes the only tricky thing now is as I said it's kind of builders finding themselves stuck
between a rock and a hard place of knowing that there are improvements that are you know highly
desirable and knowing that there are factions of people who are gonna fight against those it's
a really weird position to be in but I'll do whatever I can to support people and you know
if I have to be a dick about it I'm happy to do so well you gotta make your case right and then the
free market should should decide right yeah yeah no I I think I'm relatively neutral you know I
think without veto power in any central position you always end up with progression no matter what
and I think that like what I mean is that if there's two people and they can manipulate a thing
the one person that can't or won't is always going to sit by the wayside and the other guy will if
there's no central entity to stop it always ends up manipulated so I think it's a matter of time I
think we end up manipulated and it'll get to that position where we're you know kind of figuring
out what we want to do with it after the fact so yeah yeah I think as Paul kind of pointed out that
Satoshi said even 12 for 13 years ago like it bitcoins in an evolve or die place and and that
doesn't necessarily mean you need drastic changes you need to try and you're never again you're
never going to do everything you need on the L1 and it's going to be just as much of a fight to
double capacity on the L1 as it is to introduce things that allow 10,000 x scaling on the L2s
and so I think it's focusing on the if that end goal again is really and for me it's how do we
provide an alternative like financial system globally it's we've got to focus on that that
10,000 x increased view all the way out there and just figure out cool how do we protect the L1
as best as we can we don't want to wreck it but we got to give the things that do that actually
make it possible to scale it out that much get to a billion yes I do have my own L2 proposal
which is VIP 300 and you can download there's test software you can download
and play with for yourselves layer2labs.com slash downloads and have stuff there we have a
zcash level privacy and planetary scale I have a bunch of articles I've also written about that so
so if you want a little bit of hope you could go try the software yourself a lot of people have
like powerpoint slides or whatever which is great I actually think the industry is is already moved
past that and there are a lot of people who if you can code something it will exist
and it has the software we've written is for all three operating systems and has
buttons you can click it as a GUI so so I would I would try that out and look at the
and the proposal is the the only thing it does on L1 is use an unused op-nop
five to count to 13,000 over and over again it's a little bit more than that but that's
basically all it does and it's a completely opt-in and also reversible really if you think about it
I think the soft fork is a very we still have a little bit of time and so I'm going to ramble
about the soft fork in general which is that the this whole reason the soft fork was invented in
2012 as I alluded to earlier is that before everything was like we changed to a new version
but the soft fork was people did not need not everyone needed to only the people who wanted
to use the new feature had to upgrade this included 51% of the miners so you could say
maybe that's not true but it the the miners want to collect the transaction fee so they're also
users so the whole point of the soft fork is it was a change and not a change at the same time
so even though it is a creative act of a change it's not really as much of a change as people
might think and it's it's very underappreciated for that reason well thank you guys so much I
think we've learned a lot I'm really appreciating on stage with you Paul Alex Charles Jamison
give it up for them thank you