Making claims that running nots will result in changes, effective changes to Bitcoin that just simply they're not true.
Really, one of the big things that's changed over the past few years is more miners having direct centralized APIs for you to push transactions to and to completely bypass any of the policy rules of the network.
It's the technical debate on one side and it's like a moral philosophical debate on the other side.
And so like the two sides aren't really even speaking the same language to each other.
And that has been the crux of the decade long argument.
What is spam?
And so you have two primary camps when it comes to defining spam.
And I think a similar thing is going to play out with the treasury space where a lot of these will be fast money plays where they're not really innovating.
They may not have great long term plans.
I think one of the worst possible outcomes is that Bitcoin becomes so boring that we stop arguing about it.
It might be just nice marketing if everyone is always involved in the Bitcoin and then we talk about it more.
But before we get started with all the topics and I really want to get into a lot of those interesting things that we can talk about.
Give us some overview of who you are and especially why you are excited about Bitcoin.
I'm just a nerd who got into Bitcoin a long time ago.
I've been working full time in the space for over a decade.
Focusing on security, specifically building multi-sig wallets.
I started off in 2015, building infrastructure for over a decade, focusing on security, specifically building multi-sig wallets.
I started off in 2015, building infrastructure at BitGo, where we were focusing on enterprises and basically trying to reduce the number of exchange hacks that were very, very prevalent.
In the early years and learned a lot there.
And after three years pivoted, took a lot of the knowledge and best practices that I had learned.
And focused more on trying to bring a super high level of security for self custody to individuals because.
And I think that's a lot of the knowledge and best practices that I had learned.
And I think that's a lot of knowledge and best practices that I had learned.
That's a lot of knowledge and best practices that I had learned.
And I think that's a lot of knowledge and best practices that I had learned.
And it's a lot of knowledge.
I mean, there's a lot of interesting topics in there.
But I think there is many failures that you can make, even if you are well aware in the space.
But I see actually a lot of people getting into self-custody because they heard they should get into self-custody.
But then they don't do the homework of educating themselves.
And I've talked with some friends and they're like, "Oh, yeah, I do self-custody."
And I'm like, "Okay, what are you doing?"
And I was like, "Oh, please get better things going."
Because I think we would be shocked if we review all the self-custody setups that people have on how weak they are.
This is just my personal kind of viewpoint that I saw with friends and people that are kind of around me that share those information with me.
So it's a very small bubble, but I have a weird feeling that's kind of representative of the mainstream of people that have self-custody.
Yeah, I mean, I would bet that over 95% of people have potential single points of failure in their setup.
And that's true regardless of if they're doing self-custody or if they're leaving their money on an exchange.
Or if you're in the ETF, right?
Automatically, whenever you're leaving your money with a trusted third party, that's a single point of failure.
And definitely a ton of people are doing that.
But that's really what we do.
And that's why it's not just about our software.
Like our software as a wallet is actually intentionally limited in what it allows you to do because we've determined that a lot of the functionality that the Bitcoin protocol offers is actually dangerous.
And so we kind of build in guide rails so that there's a limited set of things that you can do when you're interacting with your keys and your funds within our wallet.
And then, of course, the advisory part of it is also very important of actually talking you through decisions.
Whenever you're doing a wallet setup and trying to figure out key management, there's always many different decisions.
And each of those decisions has trade offs.
And usually the trade offs are between convenience and security.
And, you know, we just want people to understand what those trade offs are, because if you don't have some sort of expert to talk to and you're not going out there and spending a lot of time doing the in-depth research, you may be making decisions without fully understanding the consequences.
And I think, are you Austrian?
Is that correct?
Yes, I'm Austrian.
So like not only economically, but also like actually living here.
Yeah.
Yeah.
And so while, you know, our app is currently in English, we also have client advisors who speak Spanish and German.
And, you know, a lot of people are more comfortable speaking in their native tongue about more advanced concepts like this and really about anything that is potentially this important to their life.
Yeah, especially.
I mean, maybe a special case because I speak 99% of my life English because my girlfriend speaks English.
English with me and my whole podcast and everything is English.
So outside of a few friends and my family, everything is English.
So most of the time I speak English.
But yeah, like that's for sure.
It's very important for the native language.
Maybe let's come to the, to the, to the thing that we've talked about before already the podcast started.
You called it what suits summer, something like that.
Suitcoin summer.
Yes.
The, the, the wall street and institutional adoption level.
Yeah.
It's super interesting.
What do you mean by that suit coin summer?
Well, you know, essentially what we're seeing happen this year, especially with a lot of the heat coming off the regulatory side with the administration change in the United States is just a lot more traditional financial engineering and bridging of Bitcoin with the traditional finance world.
So, you know, we've seen just an explosion and these treasury company plays.
Um, and I think we're going to see a continued innovation of financial engineering.
So one example of that is especially if you look at strategy and what they're doing, right.
Is that they keep churning out all of these new equities that they're offering to the market to essentially continue, uh, trying to spool up their flywheel of just accumulating as much Bitcoin as possible.
And so I've, I've kind of noted some parallels where in the very early days, uh, and one reason why a lot of people hated on alt coins is that they tended to be a play for someone to launch an alt coin to enrich the enrich themselves with Bitcoin.
It's like, this is a good way to get a lot of Bitcoin, essentially sell something that probably isn't worth very much, uh, to the world.
And I see, you know, similarities there of what's happening now with TradFi where, uh, you know, we're, we're just, we're innovating and creating new financial products, uh, to sell to various types of people out there, uh, and possibly just wall street types.
And, and the ultimate goal is just hoovering up more and more money so that we can acquire more Bitcoin and continue to, to dominate, uh, from that position.
I, I, I, I made that comparison, I think like almost a year ago at that point where I think, uh, the, a lot of the same people that buy, and it's not always the same people, but like, uh, like generally I see, uh, the people that are very interested or was very, very, very interested in the past cycles in alt coins.
Um, and now the people that are very interested in treasury companies, um, and this again, could just be my small personal bubble, but this is just something that I saw that people that are, uh, previously very interested in alt coins, maybe making with them more Bitcoin, uh, are now interested in, uh, in, in, in, in treasury companies.
I like it a little bit better than alt coins because at least it's in the Bitcoin ecosystem.
Sure.
And at least, uh, like, I don't know about all treasury companies because there are 150 and a half of them, at least they have some actual business.
Well, some of them do, uh, you know, it is concerning that a number of them are, are kind of zombie companies, but I expect this is one of those things where the market will sort itself out.
Um, you know, no, most companies fail within a few years.
Right.
So I expect that this will be no different.
Uh, if you look at any, uh, adoption cycle or, or call it like a new trend or new narrative that's happened over the years, whether it's like ICOs or NFTs or, or what have you.
Um, it's usually like 95, 99% of those are junk and fail.
And they were basically fast cash grabs.
And then maybe 1% or some fraction of a percent is, is actually like legitimate value creation.
And I think a similar thing is going to play out with the treasury space where, um, a lot of these will be, you know, fast money plays where they're not really innovating.
They may not have great long-term plans and they will probably, a number of these companies will find themselves, uh, struggling for, to retain relevance and their M nav is going to drop really low.
And the, then the bigger treasury companies that have better strategies are going to consolidate and scoop them up at a discount.
Yeah.
I'm also a little bit concerned about the image of treasury companies.
Uh, just because if like, for example, like, even if we break it down to like a very small level with me and my podcast, maybe even be a micro seed.
And we've co-founded where what, what you do is basically, um, we have profits and then those profits, we just invest in Bitcoin because we, this is our savings technology.
Uh, and we don't do any financing, no loans, no publicly traded, like nothing of that.
Like, I'm just me and my podcast.
Um, and so the, this is also a Bitcoin treasury company, but it's a very different Bitcoin treasury company.
Yeah, no, I mean, it's the same thing with Casa, you know, Casa has accepted Bitcoin since inception.
And, you know, we, we probably only have single digit percentage of our clients that pay us in Bitcoin, but the ones who do, we don't sell it.
We, we eat our own dog food and we manage our own, uh, treasury using our own software and services.
Um, we've actually been approached by banks and stuff who want to turn us into a, you know, a public treasury company.
But I think that, you know, what they're looking for is just that pure asset play.
And, and we're basically like, no, we're a real business.
We have subscriptions.
We have recurring revenue.
We don't want to be valued based upon just the treasury.
Yeah.
And the whole business case shifts as a new business at that point that you are kind of onboarding.
And this can, uh, also kind of be bad for the existing one.
So I, I, I always like to make the distinguishing between, uh, the treasury companies and there are treasury companies that have fiat games and, and they just like saving in Bitcoin.
Um, for me, it's interesting.
What you see is kind of like the implications of that.
Is that just something natural that like will help them?
Like, of course, companies now coming and they're trying to do, uh, uh, fancy fiat games, uh, in, in there.
Or like, do you see any further implications of that suit coin summer?
Hmm.
Um, well, I mean, I think we're also going to see a lot of the alt coin mania bleed into suit coin stuff.
Right.
Because it's, it's, it's just another iteration of the same thing.
Uh, you know, buy my bags.
Uh, uh, I think a number of these, these alt coins are, are kind of struggling because we haven't, we haven't seen the return of retail in many years.
And so since I think a lot of, of alt coins really, uh, thrive upon needing retail hype and FOMO.
Now they're trying to figure out, is there any way that we can cash in and leverage off of the institutional trend that is happening?
And that I think it remains to be seen.
Um, you know, obviously we're seeing a lot of like Trump organization stuff happen around that.
But, uh, I think a lot of the, the major alt coin ecosystems are trying to do similar things.
And I don't know if it's going to work out as well.
I think that we did have, there was a company that like, um, in the past week announced a Dogecoin treasury.
And I think their stock dropped like 40 or 50% right after doing that.
So hopefully that's a sign that, uh, it'll be a bit healthier this time around.
I just hope that, uh, the most positive hope for Bitcoin treasury companies that do Fiat games is that alt coins just die out because those who want more Bitcoin and want to do, uh, like leverage things and stuff like that.
They just go to treasury companies and do it in the big Bitcoin ecosystem.
And just don't even go to, uh, uh, there's, there's always going to be some segment of, you know, call it D gen, uh, gambler population.
That's going to be seeking out the extreme end of the risk curve and hope that they can basically, you know, win the jackpot.
Yeah.
And I, I don't have anything against, uh, like the meme coins that are like labeled as meme coins because like, yeah, like you, you bought into a meme coin, they're advertising it as a meme coin.
Like it's, it's completely on you.
A problem I have with those, those alt coins who say, oh, we have money and like, we will take, overtake Bitcoin.
Like we are this, this nice network.
That's where I'm like, yeah, that that's fraud.
Like you, it's false advertisement at least.
Yeah.
Uh, well, things get weirder.
Like one thing I've noticed with the, the, the suit coin play is it's illegal for you as a representative of a publicly traded company to make, uh, you know, forward based predictions of what like the price of your equity is going to be.
But apparently there's this massive loophole that, you know, sailors exploiting.
And I expect a lot of the alt coin treasury companies are going to exploit as well, where you can have your company.
That's a treasury based company.
And it's completely legal for you to make forward looking price predictions for the actual crypto assets that your company is pretty much directly priced based upon.
That's, that's an interesting observation.
I guess it's the, I've never thought about that because, uh, I mean, the sailor himself, uh, said it in multiple interviews that, uh, he would not be allowed to talk about the price of his own stock.
Uh, because, uh, it's a security, but with Bitcoin, he can talk about it.
So like, uh, I've, I've heard him say that at least two times already.
It's, it's, it's, it's an interesting.
I never thought about that, uh, that, that they kind of like, uh, they are connected to Bitcoin and in that way you can actually talk like, Hey, like this is the price of Bitcoin.
I'm going to be just type it in what this will translate to strategies one-on-one.
Yeah.
And I mean, I really don't like, I mean, I don't like anyone who makes future predictions about the price of Bitcoin.
I've said for many years that Bitcoin as a system was never designed to guarantee any sort of like appreciation and the exchange rate.
There is no guarantee that the price of Bitcoin goes up.
The only guarantee that we basically have is that central banks and governments are going to continue debasing their own currencies.
Now, you know, you can extrapolate whatever you want from that, but still, I think anyone who like puts, uh, absolute numbers and timeframes on price movements is, is doing, uh, a soft form of fraud.
Like, cause no one can predict the future.
Especially if it comes with promises.
Like if, uh, if it comes with something and I, I thought, I, I, I, I want to go, go also to the social aspect of, of, of Bitcoin as we talked before, because I do think, um, those, those, those price predictions are a really good marketing for people who come into Bitcoin.
It's this, this, this fear of missing out and it's like, Oh, okay.
This, this, this past performance.
Oh, like it will have this performance.
Oh, let's look into that.
And all of a sudden like the, the, my, like that was me.
I also came into like, and I, I would guess a lot of people actually came into that.
Uh, just saying like, Oh, I can make a lot of money with that.
So I, I think there is some sort of value in price predictions, but I have a big problem and I, I exploit that a lot with my thumbnails.
So I'm sorry for that.
Uh, just because it, it works so good.
Uh, but I myself, um, I usually don't do price predictions with, with, um, with years because I don't, I don't, I just don't think this is something professional.
It's, it's something you cannot even say.
I, I can literally say like, Oh, Bitcoin will go to a million because I'm, I'm very confident at some point in time, the US dollar will drop so far in value that Bitcoin will reach naturally this, this price point.
Will it be next year or in 10 years or in a hundred years?
Like, I don't know, uh, probably closer to this year than a hundred years, but like, we don't know.
So this is an interesting one where it has a social impact on us.
It brings new people in at the same time.
It's like, ah, you don't want to promise anyone anything because they can also be pissed off by that and stuff like that.
Yeah.
There's no winning.
Um, for example, I have plenty of people who are upset with me that I didn't convince them 10 years ago that if they bought Bitcoin, they would get rich.
Rather, I focused on the like libertarian and free markets and censorship resistance principles, which did not resonate with the vast majority of my peer group because they're in America.
They have good access to financial infrastructure.
10 years ago, they weren't feeling any pain from inflation.
So, so me talking about inflation was just, you know, some crazy libertarian guy ranting about the government.
Uh, of course they feel differently now.
And, uh, since I didn't do a good job convincing them, they're upset because they could have been rich.
But it's on you, on them.
If they, if they had the privilege of having, uh, you in the friend circus and they still didn't get Bitcoin, it's, it's on you, I guess.
It's, it's on them, I guess.
Uh, so that's, that's interesting.
Um, one thing that I also really want to get into the podcast, uh, and, and people are screaming at me that I should do a debate on, on that, but I, I'm, I'm, I'm not hosting debates.
I don't like the, the style of debates.
I don't think they're really, uh, good.
Uh, good.
Maybe I still do it.
Uh, at some point is the core versus not seeing the knots filtering.
Um, I dunno how I've seen you, I think on Twitter also, uh, engage in that thing, but I was just shocked how, um, massive this, this whole debate is.
And I think you also said like that you are kinda, uh, shocked how long it's already been, uh, for, for, for the people that maybe don't know what we are talking about.
Maybe you can briefly explain what, uh, like core knots and the whole filter thing is.
Yeah.
So, you know, the, the first thing to note is that this is not new.
This, uh, has been simmering as a debate for over a decade.
Um, there's actually a really good two or three hour long, um, deep dive that Ava Chow, who's one of the Bitcoin core developers did this live stream like two or three months ago, going through the 10 year.
Um, but the, the short version is that it has always been possible to inject like arbitrary data into Bitcoin transactions because Bitcoin is programmable.
It has a programming language.
It's an extremely limited programming language, but because of the flexibility that the programming language provides, it's enough flexibility that people can be crafty.
They can be creative.
They can find ways to shove arbitrary data into transactions that the Bitcoin protocol itself just kind of ignores.
Uh, and so they're valid.
And then those transactions can be broadcast around the network.
They can get confirmed by miners into blocks.
And then you can use other software, uh, to interpret that data in those transactions.
I tend to call this like meta protocols.
This is where a lot of what we saw like two or three years ago with ordinals, for example, really fits well into this where you'd have to run a Bitcoin node, but then you'd also have to run this other ordinal software to be able to extract the data and see the images and the tokens and stuff that they were creating.
Um, and, um, and that upsets a lot of people, um, who think that Bitcoin should only be for money and not for anything else.
And this is where we have this, the crux of this massive debate debate is that I would say most people on both sides would prefer not to see, uh, like image data and, and other tokens and stuff in the Bitcoin protocol.
But if you want to stop that, it becomes this relentless cat and mouse game of, uh, trying to change the rules of Bitcoin.
Every time you see a new, you know, creative way of shoving arbitrary data into the protocol, you know, add a new rule to restrict it and prevent that from happening.
And basically the overwhelming majority of developers who work at the protocol level are not interested in playing that game because they, they see it as a,
an unending game that will just take a lot of their time and resources to continue playing forever.
Because if you're, you're making changes to the Bitcoin protocol, it's generally like a six month, if not longer process to get those changes in and then rolled out.
And then the entire ecosystem has to actually download and update the software.
Whereas the people who are playing these meta protocol games, they don't have any sort of, uh, time-based release restrictions.
You know, they can, they can come up with something new in a matter of hours or days and start using it.
And that's like one of the mismatches, uh, between like the two different sides playing that game.
But, um, in short, this has kind of magnified over the past few years.
Um, and, um, and so, whereas for many, many years, it was basically Luke Dasher, uh, kind of on his own little Island, uh, maintaining his fork of Bitcoin core, which is called knots.
And most people just not paying much, much mind to it.
Uh, they've, they've managed to pull in, uh, a number of other people who are, you know, supporting the idea of knots and running it.
And, and look, that's fine. Like anyone can run whatever software that they want.
What I find most annoying about it is that I believe that it's, it's reached a point of delusion in that, uh, a lot of the narratives around, uh, people who are saying you should run knots because, uh, they're then making claims that running knots will result in changes, effective changes to Bitcoin that just simply aren't not, they're not true.
Uh, because they're talking from a strategic perspective about implementing these filters at the policy level.
And policy basically affects how transactions relay around the network, but it does not change what transactions are valid and can be included into blocks.
And once again, there's this mismatch between, uh, the two different sides in that the people who want to route around a filter, if they are economically incentivized to do so, they can build other tools.
they can use, um, aspects of the Bitcoin network, like Libra relay, which are very open and permissive and what transactions they accept and relay, or they can go directly to miners.
Uh, and that's really one of the big things that's changed over the past few years is more miners having direct, uh, centralized APIs for you to push transactions to, and to completely bypass any of the policy rules of the network.
So we're at this phase now where it's really, it's like, it's like, it's, it's the, the, the technical debate on one side and it's like a moral philosophical debate on the other side.
And so like the two sides aren't really even speaking the same language to each other.
Um, and, and I don't know how long it's going to keep going on because it's not clear that there is a point at which the like not slash filters side will finally admit that none of their strategies are working and going to work.
Why do you think is, uh, this whole thing coming up now, as you said, it's been around for a longer time, but now it seems like it's, it's a more popular topic on, on, on podcasts.
It's more on, on, on, on Twitter.
Like I've made a tweet about it.
I told you before I'm of the opinion that we just need more notes.
Like, I, I just think we mean, we need more people to run full notes.
Uh, so getting to, I don't know, hundreds of thousands, maybe even like over a million, a Bitcoin full nodes.
Is for me more important than what implementation they're running.
Uh, we need to more people to actually defend the network.
Um, uh, but I was just writing like, Oh, like, like what is the whole thing with, with Bitcoin nods and core.
And I asked croc and then I had just like this car, this thought of like me just interacting with, with, with, with croc.
And it had like over 200,000 impressions, which for me having, I don't know, no, no, you like around 20,000 followers, which is huge.
And I was like, Oh, why are people interested in that?
I just, before I ride with croc in private, I'm just writing in with it, uh, publicly.
And I, like, I almost got attacked, uh, just asking questions.
Like I don't even, I'm not even on any side yet because I'm just not, uh, deep deeply on there.
But also this, this card was like, it's mostly the same thing.
Like it's, it's, it's the, the implement implementations are not that different from each other.
Like it's, it's what I heard, like mostly the, the same implementation.
Yes.
Uh, so there are many different Bitcoin implementations, uh, but knots is based off of core.
So it's like 99.9% the same code.
Um, why is this narrative and discussion dominating conversation?
I would say it's primarily because it's a lot easier for the average person to get hooked by.
So, you know, those of us who are deep in the technical space, we would much rather be talking
about things like covenants, uh, CTV, scaling, um, actual improvements to the Bitcoin protocol
that would give developers more tools to build a more powerful second layer solutions that can
offer things like better scalability, better privacy, so on and so forth.
But I think, I think that this is dominating the conversation because it's a lot of, you know,
that's a lot lighter on the technical aspects.
And when you try to make it about the technical aspects, uh, the people tend to completely dismiss,
uh, any of those, uh, facts.
So it's just, it's a much easier conversation.
I think to go viral and get engagement.
And that's why podcasters are talking about it.
That's why, uh, the, the head of marketing at ocean is leaning so heavily into it is because it works to get engagement.
And, um, we'll see, we'll see how much stamina this thing has.
It does feel like they're kind of drawing a line in the sand with the Bitcoin core version 30 release,
which will probably happen in the next month or so.
And who knows, uh, what will happen after that?
Maybe some of them will rage quit or pivot or move on, but I suspect that it will just be a continual pushing of the goal posts.
Is this some sort of, um, danger do some splitting of the, uh, of, of, of the Bitcoin network, uh, anything similar to what we saw in 2017?
Yeah, I mean, that's another thing that is very annoying about this is that they're actually not intending to propose consensus changes.
And this is what we've been saying for months is that, look, if you want to actually enforce what you believe should be the rules to not allow arbitrary data, then you have to actually do it at the consensus level.
You have to prevent the data from getting into a block.
You have to reject blocks that have that data.
If you actually want this, um, to affect any sort of real change and going down the policy route is just simply not effective.
Um, and they don't seem to be willing to do that.
And then it's, I think, logical not to, because I don't think it would end well if, if that, uh,
if that sect, that subgroup of people tried to fork off, I think that they simply do not have the, the, like, the economic relevance and power, uh, the, the technical, uh, capability to get all of the infrastructure and ecosystem together.
Uh, you can look at parallels, for example, to like Bitcoin XT or Segwit2x many, many years ago.
There were similar types of things where it was like a small set of people that came together and were proposing consensus changes.
And ultimately it just fizzled out because there wasn't enough, uh, enough momentum behind it.
Uh, I don't think that there's anywhere near the like Bitcoin cash level of momentum around a contentious, uh, change to the consensus rules.
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Is then not mostly, and I will probably just with asking a question, piss off a lot of people, but is it an emotional distraction or is it somewhat also helpful to maybe get more people to pay attention to full notes?
It can be both.
It can be both.
I definitely think it's heavily emotionally charged.
And that's why it's very frustrating to have, uh, calm, rational arguments with people when they're screaming about things like child porn.
It's like, uh, it's, it's really jumped the shark, uh, with regard to that stuff.
Um, I, I, I wanted to, I wanted to, to just add to that.
I think those are a lot of pots because, uh, I got, I've got those comments in the past five days on my YouTube replies.
And I haven't talked about the knots and crow at all in those podcasts.
Like I know it hasn't even been a topic in those com, in those conversations and people are posting that.
And I wouldn't post anything on the podcast that hasn't even been discussed in the podcast.
So my assumption is that there are some bots, but like, there's always some bots.
Maybe there's also really people that are really passionate and just want to put it in.
Yeah.
It's some of both, but there's definitely a lot of bot activity.
I actually just posted a tweet like right before we started recording where I posted a screenshot of several bots, uh, that have showed up in our replies.
And, um, I have a Turing test actually that, that I reply to and anyone that I suspect of being a bot and, uh, you know, those screenshots are showing definitive proof that these are like stupid LLM bots that aren't actually capable of engaging in rational conversation.
They're clearly the designed to disrupt discourse and to change people's perception of, I think the actual interest level and support, uh, for that particular narrative.
Super interesting.
I've, uh, heard something and it's stuck with me enough.
I think it's a really interesting point.
Maybe also a really good point that we already have a filter in Bitcoin built in and it's called the fee, like the network fee that you have to pay.
Uh, what, what do you think about that?
Yes.
Uh, and that has been the crux of the decade long argument is, uh, what is spam?
And so you have two primary camps when it comes to defining spam.
Uh, one camp says, well, it's kind of like, have you ever heard of the, um, there was like a judge a hundred years ago in America who was supposed to, he had to make this decision about what, what.
What material is considered obscene and pornographic.
And he, his, he was tasked with defining pornography and his definition was, I know it when I see it.
And it's the same sort of thing with spam where they have to, they're essentially like, look, I know it when I see it.
Like when you see a JPEG or some random token JSON being put into Bitcoin, that's spam because Bitcoin does not interpret that as anything.
It is not relevant to Bitcoin.
Bitcoin.
It's just people who are taking advantage of attributes of the Bitcoin protocol network infrastructure, what have you, and building on top of it.
Now the other camp is, well, we can't really precisely and quantitatively define spam.
Like we can't encode a single set of rules that will stop all of this because it is a very subjective thing.
And Bitcoin is an objective rule based system.
So that's one of the big disconnects.
So the other side is basically like the only objective thing that we really have is the economics.
If you pay a competitive fee rate to get included into the block by a miner, then you have proven that you're doing something that is of sufficient economic value for you to pay.
Now, one of the problems that we have right now is that nobody is using Bitcoin.
So there is, we're basically at fee floor levels.
In fact, we have dropped below what was historically the one Satoshi per virtual byte floor of fees.
And now people are paying a 10th of that.
And, and, and that's like another aspect of this filter argument where I think it shows that the filters don't really work because the vast majority of nodes were actually blocking transactions that paid less than one Satoshi per virtual byte.
And yet people were able to route around that.
So this is what I've been saying for a while is like the way that we fix quote unquote spam on Bitcoin is we have to get more people actually operating in a permissionless manner and using the blockchain themselves and essentially creating more demand and more competition over block space to price out the really low value, stupid use cases.
And I'm somewhat hopeful that that will happen.
I actually posted something just yesterday that's showing that there's this one layer two projects, which full disclosure, I am invested in called Citraya and they are filling up a lot of the blocks on test net right now with their zero knowledge rollup.
And if that, if that system is able to create a high level of demand when they launch on main net, then, you know, that will create a lot of demand for block space and hopefully, you know, kick off the fee market again, get more competition and price out more of the really stupid stuff.
I'm doing my part.
I'm doing my part, all the income that I can support in Bitcoin.
I do in Bitcoin.
So like all the partners, they are now fully paid in Bitcoin.
And I'm switching more and more of the payments in Bitcoin towards also paying in Bitcoin, which I haven't done in the past, but I'm starting to do it now.
So I think around 70 or 80% of the income is now fully in Bitcoin, excluding the thing of micro seed.
Um, and then, uh, about like 10 to 30%, I think is, uh, spending Bitcoin.
So I, is it really interesting because I, I love this.
I love the low fees.
It allows me to send, uh, transactions multiple times a week, uh, and receive transactions multiple times a week for like 70 cents, 50 cents.
Like it's, it's nothing like I, I pay some, a freelancer in El Salvador.
Um, and it costs me 70 cents.
If I do the same thing in the, in the fiat world, I pay probably like 20 euros, maybe 30 euros.
They also have to pay something on their side.
So I personally, uh, right now, uh, even though I think it's not good for Bitcoin long-term, I think also the fees will naturally rise long-term.
But right now I'm, I'm enjoying the roll around in the on-chain for no fees at all.
Yeah.
I mean, I think that this is also a side effect of suit coin summer, uh, because the institutions are not doing stuff on chain.
They're all using, you know, trusted third party custodians.
And so any settlement that they're doing is happening off chain.
They're not creating demand for block space.
And because we haven't seen the resurgence of retail interest, uh, you know, retail is not really using the chain very much either.
So I don't know, um, you know, we need more use cases, maybe better narratives, uh, to, to get more people into self custody.
the battle that I've been fighting for 10 years is really, I'm fighting against human nature.
Human nature tends to be prioritized convenience at the expense of almost everything else.
And if that happens with Bitcoin, it's actually bad for Bitcoin as a system. If everybody decides
to trust third parties, keeps their Bitcoin on an exchange or an ETF or what have you,
that actually introduces systemic risk and a lot of weakness and potential for capture to Bitcoin
as a system. Yeah, it's the same thing that Daniel and I always talk about that, where we talk about
a Bitcoin versus bank coin. And there's this small fear of mine that if we don't have enough people
caring about the freedom aspect, I always described as like the wealth aspect, there's the freedom
aspect, and then there's the community aspect of Bitcoin. And the freedom aspect, if you don't have
enough people that run their own full node, do self custody and do the important work to care about
freedom, we might end up in a future where we have Bitcoin, but it's actually a bank coin. And yes, we
have number grab technology, we're all rich, but we have none of the advantages of the freedom aspect of
Bitcoin. And we just ended up having a second gold standard. And we don't really have anything else.
There is some concern of mine that because the convenience is so big. So I don't know, this is
something where I'm like, it might, this is, I'm just concerned about that, that people are too
convenient, and just go in those third parties and relax there and then don't take self custody,
and run your own full node, which is harder, if you're used to the fiat system, because a bank account
is very much like exchange account, it's the same process. But taking self custody is definitely
different. So I support all self custody solutions and providers and services because they're pushing
for freedom, they're pushing for the right cause like Casa.
Yeah, that's why when people ask me like, who are your biggest competitors, I don't list other Bitcoin
wallets, I list the exchanges, the ETFs, the banks, that's what we're all really fighting against.
Absolutely. And we need as many competitors as possible. Because we then have more people that
fight on the same side. It's like, it's Protestant arms and soldiers that we are fighting on the right
side and not all like, Oh, like, those customer went to an chain. Oh, this customer went to cars,
like, yeah, who cares? Like, they're, they're both in self custody, all on the same team.
One thing that I was also thinking when you were talking about filtering is like,
how, how is filtering not censorship? Like, like, if we have this thing of like,
who defines what spam is, is like, a very hard debate for me, because it's, it's, it sounds a
little bit like the debate we have in social media where, oh, yeah, like, we have to send out things
to protect people, what they see and all that. And I'm like, yeah, like, that's, that's not filtering,
that's censorship that you're doing. And then you can grow this whole thing. So is there some concern of
yours that if we are continuing this filtering, censoring route? Again, I will just make it
clear, like I'm not on any side. But if we are on more and more filtering, that we might end up like
actually having some sort of mechanism where we may be in a world where there's some transaction that
doesn't let through. Is there any concern of yours? Or is the not saying something different?
I mean, philosophically, you could make that argument. Bitcoin is a system of rules, right?
These, these rules do filter and censor many different things. Like we censor anyone who tries
to double spend their money. We censor anyone who tries to print more money than we have agreed to be
allowed to happen with each new block. I'm not worried about it. Because as I've said,
it filters at least at a policy and relay level are completely ineffective. But yeah, from the
philosophical perspective, it is somewhat worrying. Because, and like, like I said, I'm a technical guy,
I mostly look at this system from a developer's perspective of what can be done with it, what can
be built upon it. And that if you really wanted to take the filtering debate to its logical conclusion,
you would have to strip out a lot of functionality of what Bitcoin can even do, if you want to make it
more pure. And, and stripping out more functionality will greatly degrade the ability for Bitcoin as an
ecosystem to, to grow and innovate and for people to build other systems that are anchored into Bitcoin.
And so I have this article that I wrote a decade ago, which I have been reposting a lot lately, which is
that yes, Bitcoin is money. There's also many other things. And Bitcoin is what I have called a trust anchor,
just due to the nature of the properties and the guarantees of the blockchain. If you can anchor pieces
of data into it, that functionality is very powerful and allows you to build other systems on top of it.
And one example that's been going on for probably almost a decade is like open timestamps, you know,
this, this proof of existence, you can, you can shove the proof of creation of an arbitrary number of
documents and other things into Bitcoin by using sort of the magic of Merkle trees,
and hashes combined with the immutability of the Bitcoin blockchain. And that's actually a highly
efficient thing that you can do. I think it only uses two or three transactions per day for that entire
system. But then, you know, other things like lightning network or, or arc or a BitVM based systems,
all of these things need some of the more advanced functionality and programmability of the protocol
that I suspect some people would want to strip out because it also allows you to do non-monetary stuff
with it.
Daniel Zeiss:
It's, it will, I have a feeling this, this debate will be there for a longer time. Not, I don't know
how long, but like, it feels like it's not over yet. It still has a lot of like momentum. But yeah,
maybe we've seen the peak of it. But it's, it's been interesting how, how it, it rose out of nothing,
seemingly. And it's now like very present everywhere. And it's like almost hard to not talk about it.
And one thing that I also want to make sure to talk about is the, because I think you've talked about on
it on other parts, because I think I heard you talk about that is physical attacks on Bitcoin. It's
just like, um, what else when you, when you have self custody and you make it really good, like,
what else are you really looking into with physical attacks and other vectors of making sure you as a
Bitcoin are not attacked? And is, is this something where you like, especially someone that is known
with a face in Bitcoin, uh, and with a name, uh, that, that you worry about?
Daniel Zeiss: Yes. Um, and I also get some pushback on this of people saying that, uh,
I'm flooding self custody by talking about wrench attacks. But, um, you know, I, I try to put these
things in perspective and I, I had a talk at, uh, Bitcoin, uh, 2025 in Vegas about this topic. And,
and I started off with the disclaimer that, you know, this is an edge case scenario.
I think we're up to around 250 known attacks over the entire course of Bitcoin history. Um,
though there have probably been three to four times as many, uh, that we don't know about.
Daniel Zeiss: Uh, but that's still an edge case. And that's in, in terms of risk,
you know, you're, there's a lot of things that you should be worried about before you worry about
rich attacks, uh, like leaving your money with a trusted third party, um, or just, uh, you know,
having your money on a hot wallet where it could be hacked, right? Any number of things with a, um,
custody setup where you have single points of failure are problematic. Um, and, and ultimately
if you are susceptible to wrench attacks, then you have a single point of failure in your setup.
You're probably only using a single signature wallet and someone could easily coerce you,
you know, under duress to basically authenticate and bypass all of your security mechanisms and,
uh, you know, voluntarily, uh, send your money to them. But this is the type of thing that I focus on
because this is one of the risks that our clientele is at higher risk of, uh, you know, Casa, we really
target high net worth, uh, OGs, whales, uh, you know, people who have a substantial amount of their
net worth in Bitcoin. And in many cases, these people are well-known. They are public figures.
Um, they're, you know, on social media, they're going to conferences, people know who they are. And
in many cases, it's not difficult to find where people live. Not many people have very strong privacy.
Some people live in countries where they are forced to disclose where they live legally.
Um, and so that's why I focus on that because we have actually had clients who are, uh, who have
been wrench attacks. This is not just a, a theoretical thing for Casa. Um, and if you are at that level,
then I think that you should be aware of the risks and, and be aware of how to mitigate them.
Yeah. But I like your disclaimer because I think, uh, most people will lose the Bitcoin
to their own fault, uh, of, uh, way simpler attack or something, uh, way simpler where they got social
engineer and it's like, there, there's an email popping up and they just put their seed phrase in
there and like, uh, I think those is way more likely than someone actually coming to your home,
uh, and, uh, actually attacking you somehow. Like, uh, it's an edge case, uh, but it's an important one.
And it's also interesting. I think if, if you're thinking to that extreme, you probably have a good setup.
If, if you make everything good for that, like, even if it never happens, uh, I think you probably
then have a robust setup that you can be proud of. Yeah. I mean, that's why I want people thinking
about it is because, um, you know, something that we see very commonly, uh, when we're onboarding new
clients, for example, uh, people who have been in the space for a really long time, they probably set
up a wallet many, many years ago and just left it alone. And there's a sort of, if it ain't broke,
don't fix it mentality. There's also a big fear of ever interacting with your Bitcoin. I actually,
I call this phenomenon, uh, Schrodinger's Bitcoin. It's, um, as long as you don't try to spend your
Bitcoin, you have not, uh, proven that you've lost access to it. Every time you try to spend your
Bitcoin, you're, you're risking learning that you screwed something up and you lost your bit of that.
Uh, because this was, uh, very much my experience when I, after I think three years of hodling and
never touched it, finally decided to like upgrade and I've upgraded multiple times and many different
solutions. Um, uh, my, my Bitcoin, uh, which was really like, Oh, like, Oh,
what if I don't know? Like I, I, I, I laugh because it was literally me, uh, after I think
the first three years where I just did not touch it at all. I just like had an address and just always
put it there, never spend it. Um, uh, and upgrading it and reviewing it, whatever, like quarterly,
yearly, whatever you're doing, uh, thinking about situations. Okay. What if this happens? What if this
happens? What if this happens? Am I secured against this? Am I secured against this? I think it's, uh,
a very, uh, security hygiene that everyone should, uh, kind of consider and, and do. So I, I like this
message a lot. Yeah. Um, but once again, we're talking about human nature and this, this was one
of the reasons I co-founded Casa is because this is back in 2018, I was reviewing my own setup and I was
specifically looking at it from an inheritance perspective. And I was like, yeah, I, I set up an
inheritance plan and I created a last will and testament. And I created these like sharded encrypted
backups. And I gave instructions to my executors and stuff. And I was like, this is so complicated.
I'm actually not confident that if I get hit by a truck, that they will be able to follow my
instructions and recover the funds. And, and that's, that's another aspect that we see quite often is,
first of all, most people don't think about inheritance. You know, a lot of us are still
young enough that we're not really considering the mortality aspects. Uh, we have seen some trends
where, you know, as people are there, they're, they're getting older, they're getting married,
they're having children, these major life events, uh, can sometimes spur on the realization that,
Hey, I'm not going to live forever. And I should think about my family and how they're going to
be taken care of. But even a lot of the people who then go down that path, they do something almost
exactly the same as what I did, which is what we call the treasure map. And they rarely ever actually
test it or train their executors. And so they're actually, they're hoping that there are no single
points of failure in their inheritance setup. And, uh, my favorite thing to point to is actually,
to understand the difficulty in creating, uh, a set of instructions that can't be screwed up,
go to YouTube and search for the, uh, the peanut butter and jelly instructions experiment. And this
is basically a game where, you know, you, you tell someone to write down the simple step-by-step
instructions for how to construct a peanut butter and jelly sandwich. And then they give you the
instructions and you interpret them adversarially and show how many different ways you can screw up
something as simple as a peanut butter and jelly sandwich.
Yeah. I will definitely look that up later. Uh, because it seems like,
like there can be only like two, three instructions with that, right?
You'd be surprised. Um, I asked, uh, each and every one of my guests, uh, that I knew in the podcast,
one question, the question is what can we learn from you besides Bitcoin?
Ooh. Um, well, I mean, I'm a technologist by nature, so I, I try to stay on top of different trends. Uh,
but I'm also a cypherpunk. So I talk a lot about privacy stuff and that, that is, it's all tangential, uh,
to being a sort of sovereign self-empowered Bitcoiner because while I'm, I'm a security professional,
I think about security. Um, I think one thing that a lot of people overlook is that when you're,
when you're building a security system, whether it's physical security or cybersecurity,
it's never just one thing, right? It's you, you have multiple concentric layers. Think of it as like
shields or fences or what have you, where you have to assume that any one particular security measure
could get broken or bypassed. And so you want as many layers as possible to slow down the attacker
until they eventually, uh, get frustrated and give up. And I think what a lot of people overlook is that
you have all these layers of security, but the outermost layer of security, at least when it
comes to like Bitcoin self-custody, uh, is actually privacy. Uh, because security is about stopping and
slowing down an attack when it happens. Privacy is about preventing yourself from ever being targeted for
an attack in the first place. And it's highly preferable to just never be attacked in the
first place and not have your security system tested. And so that's why, um, you know, I've
been, uh, uh, a strong proponent of privacy, not the entire time that I've been in Bitcoin,
but ever since I had a SWAT team show up at my house, uh, back in 2017, which really, uh, opened my eyes
to the physical, uh, security threats that, uh, we have to deal with, especially if we're a public
figure in the space. Why the heck was a SWAT team at your house?
Uh, it's because I was engaged in very contentious debates during the, the scaling block size wars.
And I said something that pissed somebody off and they, uh, decided, Hey, this guy has been in Bitcoin
for a long time. We can probably extort him with, uh, physical threats. And so they, they called up my
local police. They, they said the, the key triggering words to get, you know, lethal force deployed by the
police basically claiming they were me claiming they had killed someone that, uh, had hostages
and that I had explosives and so on and so forth. And, uh, and of course that resulted in my entire,
uh, neighborhood being shut down for several hours by the police until we figured out that it was all a
hoax. And, um, and of course they then tried to extort me for Bitcoin after that saying, Hey,
we're going to do even worse things. If you don't pay us.
That's crazy. Uh, wow. Like I I'm, I'm sometimes, uh, negatively surprised by what humans are able to
do. Like I'm often positively surprised by what humans are doing. This is one, one negative example,
but I'm like, Oh yeah. Like how do you think about that? Like, like how does, how does such a thought
even cross your mind that you might be able to do that? And then you also have to research and,
and put some work in there to actually go ahead and do that. And then you have to also do it. Uh,
and then like, Oh shit, like, uh, people are not all well-intentioned.
Yeah. Well, I mean, once again, you know, it's not a one-off thing. Uh, there are some very interesting
corners of the internet, especially once you get onto the, the dark net and, and sort of, uh, cyber crime
and, um, there are many different specialists out there. So, uh, the guy who swatted me, it was not
the first time he had swatted someone. He swatted plenty of people before me, plenty of people after
me. And, um, I actually ended up taking him down. Uh, this is a very rare success case. Most people who get
swatted never see justice, but I had the, the resources and the, uh, stamina to basically spend
several years collecting information about this person and working with the FBI to eventually
track them down. And it ended up being just some punk kid living in his mother's basement who,
you know, he fell in with the wrong crowd and, uh, he was using his skills to do naughty things
instead of, uh, you know, building and, uh, providing value to the world.
And what I'm always thinking, like, if he just, uh, puts his efforts, his skills and his energy
towards something productive, he can probably do a lot of great things in the world. I'm like,
like, why don't you do that? Like what, what, what demon possesses you?
Yeah. Uh, but you know, it was, it was, he was a minor. Um, and this is actually a recurring pattern.
Um, especially within the cybersecurity space, a lot of people who end up becoming respected
cybersecurity professionals started off on the other side of the fence and especially the kids.
Um, like I said, this is a whole rabbit hole we can go down, but like within the cyber crime sphere,
uh, a lot of adults like to recruit children because they know that the punishment, uh, for
children doing these crimes is generally a slap on the wrist. And so it's actually a lot of the children
that are committing the various offenses, because if they do get caught, it's probably not going to ruin
their life forever. Um, and then often, uh, these people do get caught. Uh, they flip, a lot of them end
up working on behalf of law enforcement or going into the private sector and using everything that
they have learned and know to actually protect against, uh, those types of people and attacks.
Super interesting. Um, we have an entertain in the podcast where the previous guest is asking
a question for the next guest without knowing who the next guest actually is. And the previous guest
asked you the question, what is the best way to teach your kids about money?
Ooh, well, uh, you know, there are, there are a few good children's books out there actually,
uh, that talk about like Bitcoin and fiat and whatnot. But, um, I don't know, I think one of the best ways,
which is, you know, also how I think a lot of adults end up getting hooked into it is you, you just let
them use it. Right. Uh, so, you know, giving, I've heard plenty of good success stories of, you know,
giving your children an allowance and Bitcoin and, uh, you know, they can spend it if they want to,
they can hold it if they want to. And then, uh, either way, whatever happens, you show them,
uh, you know, years into the future, if, if they spent it, well, if you had held onto it, it would
have been worth this much, or if they do hold on it, you can say, okay, now you can spend it and you
have, you know, this much more purchasing power. I like that. And it's, it's funny how we talked
about miners and now, uh, how to teach kids about, uh, Bitcoin, how the end routines kind of merges.
Um, thank you so much, uh, Jameson for being, for being on the podcast. Um,
before I let you go, where can people find you, ask you questions and reach out to you?
Uh, you can find me on X. My handle is just my last name, L O P P. I'm also on Noster though. I
couldn't tell you my in pub off the top of my head. Um, or check out my Bitcoin resources. I have like
2000 different links on a Bitcoin dot page.
Yeah. Cool. Thank you so much, uh, Jameson for being on. And also thank you so much for
everyone that is watching and listening for joining us today. As always, I'll be back tomorrow with another
episode. Bye bye.