This is the Hashrate Crypto Mining Podcast, your best choice for quality conversations
on cryptocurrency mining equipment, spec plays, and relevant news.
Thanks for tuning in.
We hope you enjoy the show.
Now here are your hosts, Crypto Chris Walken, Whale Bearman, and the Bitcoin Broski.
Hey, everyone. Welcome to the Hashrate Crypto Mining Podcast. I am the Bitcoin Broski here
today with my co-host, Crypto Chris Walken and Whale Bearman. We're joined today by special
guest Jameson Lopp. I'm sure most of you already know who Jameson is, and he goes without introduction,
but we're going to give him one anyway because he deserves it. Jameson is a staunch supporter
of Bitcoin and a big believer in personal freedoms. He currently serves as the chief technology
officer of CASA and before CASA was also with BitGo. We're excited to have you on the show,
Jameson. Thanks for joining us today. Happy to be here. Awesome. Jumping right in, we've talked a
lot about this show and having you on and which direction we wanted things to go. I mean, you're
incredibly knowledgeable on a lot of topics and it's awesome to have someone with your depth of
knowledge and your experience with us today. Connor, I'm going to kick it over to you. If you want to
jump in with some of the questions that you have, then we can just roll from there. Yeah, so basically
we do cover a lot on mining, but one of the very important aspects of mining is security practices.
And I think a lot of people, especially when you get set up with mining, if you're newer, it's not
as much as learning from your mistakes as it was anymore. There's a lot of easy ways to get into
mining now, but it leads to more mistakes. So could you kind of go over the best practices as
far as security goes, especially in the crypto verse? Yeah, I mean, it's a complicated topic. It's
funny regarding mining. I don't have a ton of experience mining. In fact, most of my mining is
actually on Bitcoin testnet. A couple of years back, I got a used Antminer S5 and was debating,
you know, just having it running in the garage for a while to see how it went and ended up actually
deciding to plug it into the Bitcoin testnet, which while that did not net me any valuable coins,
it actually made me a Bitcoin testnet whale. So I love playing around on testnet as a developer
and having tens of thousands of fake bitcoins that I can throw at people, you know, whenever there's
other developers in need of, you know, getting new applications started up. And in fact, I don't
know how many of you are aware of this, but testnet is a crazy, crazy place. And one of the reasons
I was actually able to get tens of thousands of coins was because testnet has this kind of
unique difficulty reset rule. And it's actually possible if you tie it right to reset the
difficulty on testnet to one, which means you end up getting like 100 blocks a second for a little
while until the difficulty readjusts and end up with some pretty crazy like multi hundred, if not
thousand block long reorganizations. But aside from my limited testnet experience, most of my
experience in this space is on the security side of things. And working at BitGo for three years,
I saw a lot of interesting setups and unfortunate mistakes that various enterprises made. And for
the past year, I've been working at CASA, which is more on the individual security side. But
there's a lot of overlap there. In general, wallet best practices are pretty similar between
individual and enterprise use cases. I will say that like one of the things that I saw a lot of
hobbyist miners screw up was that they were getting payouts on an almost daily basis, and would
end up with thousands of UTXOs and their wallets that weren't worth very much. And then when they
went to go to spend them, they had the unpleasant surprise that a large percentage of their value
was going to transaction fees. So this is one of those, I guess, security versus convenience
tradeoffs you have to make, because you're probably going to be mining through a pool and having to
figure out like when your payouts are going to come to you. And, you know, essentially, when the
money is going to go from being in someone else's custody to actually being in your custody. And the
more patient you are, the more risk you're willing to take there on the custody side, the more
consolidated those outputs will be. And then of course, you have to ask yourself, well, where am
I going to put them? I think most people just use single SIG wallets, probably, unfortunately,
online hot wallets. And if you really want the best security and robustness, then you're going to
need to go on the multi SIG side. But then there's more trade offs there where you're once again,
going to be paying more transaction fees, because these are creating more complex and larger data
size transactions. So at the end of the day, I think that someone who's spending a fair amount of
time in this space is going to need to have multiple different types of wallets with multiple
different security models, and basically have one wallet or several wallets that are not quite as
secure, but are more convenient to use on a regular basis. And then ultimately, every Bitcoin
hodler needs to have their like super duper long term cold storage vault. That is what I've been
spending a lot of my time working on for the past year. And that is where you can get like multiple
hardware wallets, multi SIG set up and have, you know, geographically distributed private keys, so
that you're not only protected against hackers, but you're also protected against various
catastrophes and loss scenarios that could result in you losing enough data that you can
no longer spend out your own money.
So bringing up the Bitcoin testnet, what are your thoughts on VeraBlock? And did you mess with that
at all? Because VeraBlock is kind of a kind of an issue on Twitter and in the space right now,
because a lot of people are thinking that VeraBlock is an attack on the Bitcoin network.
Yeah, I mean, that's a tricky phrase, I guess, is whenever people start calling things attacks. I
try to limit my use of the word attack to be something that is like against the nature or the
rules of the protocol, something that is trying to like undermine the the rules of the Bitcoin
protocol. And so if you call certain use cases or certain types of data that's being put into the
blockchain as an attack or a spam, I think that that is kind of emotional and subjective. If
you're paying the fees to put it in the blockchain, and you convince the miners to put it in, then
there's some economic rationality behind that, that you're basically outbidding other people if
there's any contention for block space. So I'll I have to admit that I don't know a ton about what
VeraBlock is actually doing. Like, I don't see anybody talking about building things on top of
VeraBlock. So I don't really know what value there is there. I do know that there is value to using
the Bitcoin blockchain as a data anchor. And I've written about that in a variety of different
articles. And so, you know, if people are using the thermodynamic security, the proof of work is
offering for Bitcoin basically being the most expensive blockchain to rewrite the history of
then I'm all for people building on top of that and essentially anchoring other systems into it.
Now, are they doing it in the most efficient way possible? It doesn't seem like it from my
cursory glance. But this is just another thing where I have to say if they if they're not really
bringing value into the system, then the economics are going to push out those use cases. And, you
know, they've been fairly fortunate that fees have been pretty low for the past six months or a year.
If that changes, then VeraBlock may find themselves in a bit of a pinch and need to justify the value
of the system that they've built. I think I saw a random statistic recently that they had spent, was
it something like a million dollars or maybe even several million dollars worth of transaction
fees over the past six months? So hopefully, they're actually bringing sufficient value to pay
for that in the future, because those fees are only going to go up from here.
So I wanted to circle back to the comments about security. The news that's that's out lately that a
lot of people are talking about is the Quadriga exchange fiasco in Canada. What did you make of
all of that hearing that, you know, the the CEO of the exchange had died suddenly and no one had
access to the 140 or 197 or 141 million, I don't remember the exact number, dollars worth of other
people's money? How did that read to you?
My first thought was, you know what, this is exactly what could have happened with Mt. Gox. I
don't know how familiar you are with the the Gox setup. But we learned after Gox crashed and
burned that in fact, Mark Karpalos was the sole owner and holder of all of those cold storage
devices and keys. And so if and and I'm actually I'm very surprised that that he managed to get
through this without being physically attacked. And if he if he had gotten attacked and hurt or
killed or whatever, then the the Gox fiasco could have actually ended up a lot worse where there
would be no coins that got recovered because they wouldn't have been able to get the the cold
storage that he found, you know, a few months after. So it's, it's just simple negligence,
right? And I think that in Mark's case, he has a little bit more solid ground to stand on,
because when he started, the coins were basically worthless. And and people weren't prepared for
them going up several orders of magnitude. But you know, with this guy, I don't know how many
years Quadriga was actually operating. But you know, Bitcoin was already pretty big, and I think
at least in the hundreds of dollars when they started. So it just it just sounds like another
case of like incompetence and negligence, leading to a business operating a fractional reserve and
like trying to claw their way back into solvency. And we've seen already that that's a very difficult
thing to do. Yeah. Yeah. And I mean, going off that, I think a lot of exchanges, even though these
things happen, and yes, they are bad for the space, they end up being building blocks for the future.
And with security, most of the time, you just learn the hard way the first time if you're
following everything the right way, then there's obviously something new that needs to be implemented.
So in this case, I definitely agree it was just not doing what was required of someone that handles
that many coins at one time. I just I mean, even me, and maybe it's just because I've been in the
space for a while, but I I do not broadcast when I go out to places. And when I do travel internationally,
I make sure, you know, there's there's no way that anything could be extracted from cold storage or
or or else. So I just find it insane that these guys that are running these companies that have
millions of dollars and billions of dollars even aren't running around with like security teams.
And I mean, it just it blows my mind. You see these these kidnappers that know that these people
like I think there was a conference in Mexico for Ethereum a few years back when some people
were getting kidnapped, I believe. I don't know if that was a rumor or not. But yeah, I mean,
that stuff scares the shit out of me. Yeah, I mean, I've heard a number of stories about that,
especially the conference that was happening in Cancun. I forget exactly who it was that
that was saying this. But there there was one group of people who were trying to employ,
I think, some former special services, like, you know, former Army Rangers or something,
types of of of personnel to basically be their bodyguards so they could go down there.
And, and, and that bodyguard company, actually, they did a survey, basically, of the the locale
and the recent activities that have been going on. And they basically said, you know what,
we're not going down there. We're not we advise you not to go down there. We don't want to go
down there. You know, there's a lot of like cartel activity in the area. And so they ended up not
going to that conference. And I've been to a few other sort of VIP level conferences where there
has been actual like armed security, plainclothes around the conference that really started
happening after the last bubble before this, you know, crypto was so tiny that we didn't have to
worry about anybody even caring enough to try to show up at a conference. And it's it's unfortunately
just the the the nature of the beast of like being your own bank. And if you're walking around and
being public about being your own bank, then you have to be ready to actually protect your assets.
And so that's part of the reason why I switched from doing enterprise crypto security to individual
stuff, because I felt like there was a gap in the market there, and that it's actually going to
become more and more important for people as we go through more bubbles as more people finding
themselves basically unexpectedly falling into levels of wealth that they're simply not prepared
to handle. And we've we've, you can actually see historically, in a vast majority of cases, it seems
that people who suddenly acquire large amounts of wealth often end up losing it one way or another.
And I'm afraid that that is basically going to repeat, but in a new way with this new technology,
if we don't have a bunch of people building tools and services to help people secure their own money
and really make use of this, quote unquote, being your own bank, because there's there's just so
many ways that you can screw it up that I think that we're going to find it's more likely that
you make a mistake and lose access to your private keys than someone attacks you and takes them from
you by force. But that's just, you know, anecdotally what I've seen over the years, and I kind of expect
that trend to continue. And I'm also monitoring the physical attack side of things and watching
that trend sort of go up and down along with the price and the general mainstream awareness and
mainstream awareness and therefore criminal awareness of this new type of honey pot for
for physical attackers. Sure. And, you know, with the work that you're doing in CASA right now,
I mean, what what do you find is the the most prevalent problem that you're currently trying to
solve? It's it's basically getting rid of single points of failure. It's it's boring old data
management and IT practices really is what it comes down to. We have gotten to the point in
the space now that we have a variety of decent hardware devices that can help you protect your
private keys. But if you get, you know, a treasure ledger and initialize it and go through the setup
process, then, you know, the first thing that it says is, you know, here's your 24 word seed,
keep this safe. And I think that that phrase is the tip of a huge security nightmare iceberg that
gets completely glossed over. Because, you know, keeping that seed phrase safe, it involves a lot
of data security, both on on the cryptographic security side and on the robustness of like
having multiple redundant geographically distributed backup side. And so, you know,
we sat down, we thought about this problem for a long time. And we basically came to the conclusion
that we felt like the most user friendly approach to keeping seeds and private keys safe is to not
have users deal with them at all. But rather, if users can just imagine, you know, these tangible
held handheld devices, basically their treasures and their ledgers, their mobile phones, whatnot,
then it's a lot simpler for an average person to envision, you know, the actual security of a
physical thing. So as long as you have these physical things geographically distributed,
then we can give you a very high degree of confidence that your private keys can't be stolen,
that they will not have a sufficient level of loss that your your complete wallet will
become inaccessible. So it's Yeah, it's, it's really trying to keep the user from shooting
themselves in the foot. And, and I've been writing software for over a decade now. And the user
is usually the biggest problem. You know, there's always technical challenges and scaling issues,
and, you know, tons of complexities and all the different levels of software and network stacks.
But at the end of the day, the user manages to create problems that we never even dream of as
programmers. Yeah, well, yeah. Oh, go ahead, Chris. I'd say I made the joke on Twitter that,
you know, we can't have adoption until Nana doesn't have to input her 24, you know,
passphrase seed key with her arthritis fingers, you know, and we've we've all heard the horror
stories of people that have tossed out laptops with 10,000 Bitcoin and stuff on there, because
they haven't backed up their seed keys. So yeah, the solution that you guys are having at cost is,
you know, it's a very big thing for the space. Well, and, you know, also, I mean, right now,
obviously, the system that we have is broken. Just, I think that anyone who's paying attention to,
to the world economic system can can see that pretty, pretty easily. But one thing that always
remains true, is that people will give up their freedom for a level of convenience. And it's,
I think that the one area that I know as as definitely the newest person on this podcast,
right, I'm of the four of us, I am the newest to crypto. And I'm definitely probably the least tech
savvy. So for me, as as I've learned and gotten into the space, the, the, the areas that have
always drawn me in the fastest were those that were the easiest to understand. And for that newest
person coming in, there needs to be a level of a level of ease to it. So I think that that's the
thing that I'm I'm seeing with casa that is cool is it's just easy. And easy is good to an extent,
is good to an extent. You know, Connor, we were, we're talking really, I know your internet dropped
out there for a second. But we were talking about the problems that they're they're working to solve
at casa. Did you want to jump in and get some questions about Jameson living off the grid and
kind of the story behind that? Actually, Jameson, if you want what, what led to that shift? So why
did you go from from your living situation before to now kind of removing yourself from, from the
grid and doing things the way you're doing them now? Well, I mean, I've noticed a number of
exponential trends in the Bitcoin space, not just with like the exchange rate and the general level
of mainstream awareness, but also with like my presence online, social media following and
resulting backlash at times due to controversial things that I may say or do. And one of the
results of that is it's a very small scale of what you know, real mainstream celebrities run into,
which is basically the celebrity stalker or the, the deranged person who doesn't really see the
line between right and wrong. And so this is just the result of having, you know, hundreds of
thousands of people who are listening to me is that it's inevitable at some point that I say
something or do something that will trigger someone and that someone may be in the like 1%
of psychopaths or sociopaths. And I need to now actually worry about the attacks that may come
from that type of person. And I, I am fairly libertarian or anarchist leaning and it doesn't
make sense, I believe, for me to rely upon law enforcement or in general rely upon the third
parties to protect me from any type of attacks. And so I've, I've, I've tried to take a similar
approach on the physical side and the privacy side as I have with my technical security around
my, my crypto private keys, which is that we have to assume that there will be another order of
magnitude like increase in value or order of magnitude increase in level of attacks that
happen on you. And so if that is, don't mind my dog in the background there. And so if, if,
if the level of, of like attacker resources that are going to get thrown at you is increasing by
a power of, of like 10 or several orders of magnitude, even then you can't wait until that
happens to make changes. Like you have to have a level of security, a level of, of privacy
that is an order of magnitude or more, more than you think is necessary. So it's kind of like the
overkill shock and awe type of approach, I guess, better safe than sorry. And so as a result,
after having the, the one incident of some idiot calling the police and, and claiming that I had
killed a bunch of people, which ended up, of course, getting my whole neighborhood shut down,
I decided that I didn't want that to ever happen again. And while the police assured me that they
wouldn't shut down my whole neighborhood and send out the SWAT team without calling me first next
time, I figured, you know, that assurance was not quite sufficient to give me peace of mind.
And I ended up spending about six months and tens of thousands of dollars on attorneys and
various legal constructions, which allowed me to then own property that is, you know, publicly
registered, but not have my name tied to anything. So I've, I've really changed a lot of aspects of
my life, just to make sure that whenever I am in my physical location that I spend most of my time
in, that nobody in the general vicinity actually knows who I am. I have proxies for almost
everything that I do, not just network proxies, but like human proxies, you know, using lawyers
to do various things, using legal entities to do various things, and just keeping my name off of
anything. So whenever I'm, I'm out in the world using my real name, then it's either because I'm
doing something over the internet through various network proxies, or because I'm doing something
at a location that is not where I spend much of my time, and I'm just doing a quick in and out visit.
So, I mean, it comes to a point, right, where it sounds like it, is this worth it to you? I mean,
is this really, I mean, I know as someone like yourself that came into this space, and you saw
the opportunity here, not only financially, but the revolution side of things, and that's probably
more of why you got involved in it, and it wasn't about money in the beginning. You know, is this
really what you thought would happen? I mean, at this point, it's almost like, it's like your whole
life now is changed. And did it change for the better in your opinion? Or do you think, you know
what, maybe I should have never made public of my roles, and I should have just 100% remain anon?
From a personal standpoint, it would have been much easier, and I guess safer, if I had simply,
you know, bought my crypto, put it on a cold storage setup, and gone about my life. But you're
correct that really, my life has pivoted and become really focused on this. I would say, like
when I went full time into the Bitcoin space four years ago, I had already been doing hobbyist side
projects for a few years. And that led me to realize that I was, I guess, gaining a lot more
from that. I was getting more satisfaction from working on those side projects than I was on my
day job, which was working for email marketing software, doing backend data analysis, which is
actually kind of ironic because I was basically anti-privacy before. I was like stripping people's
privacy away by writing these huge MapReduce jobs, running over petabytes and petabytes of data,
where I was figuring out all of these different attributes of people and their online habits,
so that marketers could sell more shit to them. But now, you know, I go full time in the Bitcoin
space, and I feel like I'm actually making a positive difference, where I'm helping people
escape the existing banking system. I'm helping people, you know, evade capital controls and
basically empowering people in a way that I was not before. And while I've been, you know, focused
on Bitcoin and crypto for the past four years, it was actually at that time that I decided that I
wanted to make my career goal and basically my life mission is to help empower people through
technology. And so, you know, going down the route of being a cypherpunk and saying, you know, I
believe that privacy enhancing technologies are a meaningful way to impact change upon society and,
in fact, improve people's freedom throughout the world, that I felt like that, at least today in
the early days, doing that through crypto and private key management is the most obvious way
of going about it. But even if Bitcoin gets to like full mainstream adoption, and I get bored of
Bitcoin, then I suspect that I will still remain in the technology space, but perhaps switch to
some other sort of privacy or liberty enhancing technology. I'm also a big fan of 3D printed
firearms, for example. Yeah, me as well. Hold on. Have you shot one? No, my 3D printer is not quite
high grade enough to do a lower that I would be comfortable putting my hand into. I'm also interested
in the, you know, the ghost gunner. I've been keeping an eye on that as well. But what was it,
there was actually just in the past week or so, someone dropped a full payload of basically
every single AR 15 part. And so, like I said, my current 3D printer is kind of crappy. And I'm
hoping as that technology continues to improve, then hopefully someday I'll be able to buy a good
enough 3D printer for like under $1,000 that could actually, you know, print out any conceivable
firearm part. Yeah, I mean, that just goes hand in hand with the space. And it's insane to me,
the kind of backlash and the grip that the media has over the population on how that knowledge,
that is literally just a book. And they don't want people to have that ability. And the fact
that they're trying to make it illegal. And it's Cody, Cody's taking a lot of flack for that. And
I mean, hats off to that guy for doing what he's doing. Followed him throughout this whole ordeal
that's been going on. And I mean, yeah, it's crazy. It's not as on the level of what you're doing.
He is going through, I can't even imagine his OPSEC, but it's got to be top of the line.
Interesting. Yeah, I mean, I think right now, not to get too far into politics, but
for me, at least, as I see the way that the country is shaping up, especially coming into the next
four to eight to 12 years, the lack of belief in a person's personal freedoms is, it's troubling.
It's unsettling to see kind of the direction that we're heading in, knowing that there's probably
not much we can do to stop it at this point in time. There doesn't seem to be enough of an outcry
to maintain our freedom. And you can kind of just see with each new generation that's being raised
up, less and less of a desire to hang on to control over our information, control over
the things that we're able to do for ourselves. I don't know, when it comes to that and the future
outlook, have you thought about, I mean, where we're going from here as a country, what that
could all mean, not only for us personally, but for cryptocurrency as a whole?
Oh, yeah. I mean, it's very bleak to think about at that level. I don't necessarily believe that
any one of us can change the tide. But what we're trying to do at CASA is at least offer
some alternatives. And the theory being that if we can make the alternatives
somewhere close to being as user friendly, as the extremely convenient non-privacy preserving
options, then hopefully we can at least get a non-negligible number of people using these
alternative systems that empower them a bit more. And so, you know, with regard to like the CASA
node, for example, like right now that is helping people navigate their way around Bitcoin and
Lightning and basically being sovereign with their own private keys and their transactions on those
networks. But if you think about it, sovereignty on the internet basically means running your
own services for anything. And like if you wanted the ultimate email sovereignty, for example, you
would run your own email server. Now, there's a reason nobody does that because nobody has really
made that very user friendly. It's extremely convenient for us to use Gmail or some other
centralized third party that is spending all of their time working on the intricacies of email
management. Like I mentioned earlier, I worked for an email marketing company for 10 years and like
on the back end, it is extremely complicated at the technical level, but also at the non-technical
level. There's a lot of like human relationships that actually go on with regard to keeping the
emails flowing. And so we do believe that there is a huge opportunity there, especially if we can
figure out the crypto side of things and then move on to other services, is to help empower people to
hold on to their own data and run their own services on the internet so that they're not
trusting third parties. And that could be applied to almost any type of service if you think
about it. It's really just going to come down to what do we think are the things that are going to
be most impactful and are going to be most feasible for us to implement.
Actually, going off the email server, I did see a new, I think it's a startup
called Helm, and it's a personal email server that you can basically put it on your desk.
Even it's not that big, but it's supposed to be a pretty easy solution for people that want to do
that. And I definitely agree with you. That's one area that a lot of people don't understand how
insecure email is. I think that's a good segue to talk about 2FA and also...
James, was there something else that you wanted to add to that point?
Well, it's just what we've already found from shipping out nodes for the past six months or so
is that you've got the server-side infrastructure environment that is what is running most
networks. And there's a big discontinuity. There's a big gap between those two things.
It's very difficult to get people to be able to run internet-facing web services that's on their
home network, just due to the complexities of networking in general, and the fact that users
are not IT gurus. So that's one of the biggest challenges we've been struggling with. We knew
it was going to be tough in the first place of basically deploying hardware into these unknown
environments. We've definitely found some very unique home networking environments. One of them
is when users have called in and said, hey, my node's not working, and we have to do a lot of
debugging. So that's just part of the learning curve that we're having to scale.
Yeah. I mean, I would imagine most people aren't even comfortable opening ports on their network.
So hands down, you guys made it super easy for me. I was expecting there to be something that I
just maybe was doing wrong and was going to have to debug. But when I got the CASA node, it was
just pretty much plug and play. It synced super fast. That was one of the things that I wasn't
looking forward to, because I already run a couple of nodes already. But yeah, I mean, I wanted to
see how easy it truly was. And it was not hard at all. And I didn't have to do anything that I don't
think someone with at least a decent understanding of how computers work would be able to set one up.
Yeah. So I'm a big privacy coin person, I think, especially with the conversation we just had.
There's a lot of leniency towards that. I know you talked a bit on MimbleWimble before,
the launch, and it was pretty exciting for the mining community. But after the
launch of Beam and Grin, what are your thoughts on MimbleWimble now?
Yeah, I mean, it seems like a lot of the interest has kind of plateaued at the moment. Whenever
there's a launch of something, then you have a lot of speculators jumping in. And now it's kind of
back to the grind of watching the developers actually make these networks more secure. And so,
you know, there have been a few fairly major security flaws that have been found and patched.
I mean, pretty standard stuff for anything that's such a new type of protocol that it's almost more
surprising that there haven't been any crazy network-wide failures, at least not that I'm
aware of. But it's really going to be like a long-term battle of philosophies and economics,
I guess, between Grin and Beam to see which of those get more traction. And I've heard decent
arguments for why some people may prefer one to another. I mean, personally, I'm more of a fan of
Grin because I feel like it has more of a Bitcoin philosophy to it, whereas Beam seems to have more
of a Zcash philosophy to it. But, you know, that's the market for you. And we'll see how they keep
working out. But I think what would be more interesting, which I've heard a few rumblings
about, is like if they can actually get Lightning Network support working. And if you can tie
Lightning Network into an extreme privacy coin like that, then it seems to me like that opens up
a lot of more interesting possibilities. Because, you know, Lightning Network is a
fairly private in and of itself, but you still have the on-chain privacy issues. You know, when
you're opening and closing channels, there's a lot of things that may change on that side as the
technology continues to progress. And we see like multi-party channel opens and closes. But ultimately,
it seems like the best way to get awesome privacy is actually to jump from one blockchain network
to another blockchain network and back around. I'm not a blockchain analysis expert. But as far as
I'm aware, unless you're getting a lot of third-party data and able to basically
extract data from the points at which people are entering and exiting the blockchain, it's going to
be darn near impossible to actually correlate multiple different blockchains and the activity
that's going on if that activity is only happening within the protocol and not happening with some
third parties that might be leaking data. Yeah. I mean, I think there was one that came out
recently. It would use XMR to broadcast a Bitcoin transaction. And I was pretty excited about that.
I didn't actually test around with it, but I heard some decent things.
Yeah. So it's kind of funny that you brought up your favoring of Grin, because I basically figured
that me and Connor, we actually had a talk about MimbleWimble, but we didn't get to talk about
Grin. We actually had a talk about MimbleWimble, and we were basically comparing Beam and Grin,
saying that Beam was much more of the corporate side and Grin being more of the cyberpunk side.
But my other question towards you was, so they had the announcement basically of Beam and Litecoin
working on something together. I kind of feel that implementing privacy is kind of inevitable
for Bitcoin. So what are your thoughts on the whole Beam Litecoin thing?
Okay. I might have actually missed that. Well, so I think I saw something about Litecoin working
on implementing confidential transactions. Was that what you're referring to?
Yes. That article was on Medium. Okay. So they're actually doing that in conjunction with Beam?
Yeah. Well, more power to them, I guess. I think a number of Bitcoiners got triggered by that,
because Litecoin was kind of the one that really got segregated witness adoption out on a production
network and kind of showed that a lot of the FUD around it was just FUD. And confidential
transactions on Bitcoin is also another interesting debatable topic, right? Is that
it's a substantial protocol change. There are people who have, I guess, issues with
what it might mean with regard to auditing the entire monetary supply, with regard to
bloating the blockchain with larger data size transactions. It seems like there hasn't been
too much discussion, at least that I recall, around trying to push that into Bitcoin. But
there may be some people who are so against it that they even see Litecoin adopting it as kind
of a threat because they think that then that will be used as an argument of, see, look, it's safe.
Litecoin did it. Now Bitcoin can do it too. But yeah, I'm interested to see Litecoin implemented.
If anything of like Litecoin as a production test net for Bitcoin is something that I've felt like
has made sense for several years and really proved itself with the whole SegWit thing.
Yeah, that was exactly my thought with the whole Litecoin being Bitcoin's test net and
them possibly implementing the confidential transactions that might spill over to Bitcoin.
So yeah, it's interesting to see where that's going to go.
Now, Jameson, aside from Bitcoin, when it comes to in MembleWimble as well, are there any other
coins that you pay any attention to whatsoever? I mean, are you looking at any of the altcoins
that are available and trading currently, or is it just kind of a focus on Bitcoin and the
MembleWimble protocol and then things that can come from Bitcoin? I mean, there's a lot of
the MembleWimble protocol and then things that can come from those, or is there a broader view
of the market that you're taking? I mean, I mostly pay attention to any privacy enhancing
technology. So I also try to pay some attention to Monero and Zcash. At Casa, we have done some
research into multisig on Monero and multisig on Zcash. I think the trickier question is around
support from hardware devices. It's been a very slow process. So like Monero, I believe,
late last year finally implemented multisig, though at least the original multisig was only
M of M or M of M minus one. They didn't have like the arbitrary M of N that we needed for doing
three or five wallets. But I think that they did recently add that. And now we're looking
at hardware support. There's definitely been plenty of demand for that. Now, at BitGo,
we implemented multisig for Zcash, but only for unshielded transactions, which is basically
Bitcoin transactions. So it was easy. I think that doing multisig and shielded transactions
is also not been done yet, at least not that I've heard of. So it's complicated. It's like,
how do you get privacy and security is the problem is like, you know, we have these extreme
privacy coins, but they tend not to have the more complex like multisig scripting features
that we want to have for ultimate security. So I guess the last thing I wanted to cover
was more on the on the Lightning Network side. I love Lightning Network. I think it's something
that needs to happen. And like currently, I am on the belief of, yeah, the Bitcoin network
right now, without Lightning is in the future will be kind of like an ACH transfer for a
larger transaction, one that you want to know gets confirmed on the network with maybe someone
you don't trust. Or like I said, with a with a bigger, a bigger size order, and the Lightning
Network is going to be to take the bloat off of the main network with smaller transactions
with people who you might already know, or it's an amount of money to where you're not worried
about it, you know, I guess not worried about it, really losing losing from transaction. But
overall, you I can see Lightning Network being something that that lets Bitcoin scale to the
level that we want it to. But, you know, right now, currently, I mean, I didn't think that
it was going to be as complicated as it is right now. Even even with even with Casa, I still feel
like we are definitely in the alpha stages of lightning, lightning network. I think that
there is a lot to be said with how easy this is going to be in the future. But right now,
I think you guys have done, you know, everything you can to make it as simple. But how long do
you think it will take for Lightning Network to, to really have that adoption, say, where, you know,
someone who doesn't understand, you know, necessarily what's happening on the back end,
back end, can can comfortably use it without messing up? Yeah, I mean, that's, it's tough to
say, because I think the, the first question that might be more relevant is, do we think that even
regular plain old Bitcoin has reached that point yet? I would say no, like, like, even even regular
old Bitcoin is still not like mom and pop user friendly. And so the stuff that's happening with
Lightning Network is like even more out there and cutting edge and experimental. And, you know,
we're we're running into issues, you know, with the the Casa node, for example, of, you know,
L&D changes that happen, you know, it's still in a state of flux where bugs can get introduced,
and some things may start start, like temporarily failing or having unexpected behavior simply
because of the pace of development that is happening at that layer. So, you know, it's still
reckless to use Lightning Network, because, for example, like the backups are not at the
the level that they need to be to, like perfectly reconstitute lightning wallet and all of its
channels. That is one of the very simple reasons of why it's still very experimental is because
of how easy it is to lose access to your money if you have some sort of hardware failure or something.
So, you know, when will any of this technology get to the point that it can really have mainstream
adoption? I really wish that it was easy to find more types of discussions like we're having right
now, but from 20 years ago with like the internet, right? I wonder what people were speculating back
then. You know, there are a few famous examples of, I guess, like the economist who said,
Krugman said that the internet was never going to be like more important than fax machines or some,
you know, very pessimistic views like that. We only really hear the few extreme historical views.
I wonder, you know, what was the real general thought around the evolution of the internet?
You know, I got on the internet in the late 90s. I was, I guess, doing AOL dial-up and then early
days like Time Warner, quote-unquote, broadband. I mean, it was still faster than dial-up,
but I never really thought about it that much. I just, you know, took whatever was presented to
me and started playing around with it. And, of course, everyone else around me was looking
at me like I was crazy. So, I'm kind of used to being in that level of like being on the edge
of stuff and having everybody looking at me like I'm crazy. And then maybe like 10, 15 years later,
I turn around and they're all doing stuff that, you know, 15 years earlier was considered crazy,
but now it's normal. And so, with adoption, it seems to be more about just adding more and more
layers of abstraction and user-friendliness so that, for example, a lot of people today that
they're picking up their smartphones and they're doing their Snapchats and their Facebooks and
their WhatsApps and whatnot. And they have no clue of the complexity that is going on under the hood
that, you know, those of us in the 90s were dealing with. It's all been abstracted away,
and all you have to do is swipe left and you get amazing levels of functionality. So, you know,
from that standpoint, I think that a lot of it is going to be reliant upon the user experience
engineers and the level of iterating that we can do where, you know, we've already seen some pretty
cool stuff with Lightning come out with like Jewel and other user-friendly wallets for Lightning
Network. And we just need to fail more. We need to screw up more and learn from those failures and
move forward. And in fact, that's one of my most recent talks that I've been going around and giving
is this kind of 10-year overview of all of the catastrophes that have happened in Bitcoin,
all the different ways that people have screwed up and lost millions of dollars over the years,
and how each of those screw-ups, you know, while they were catastrophic, at least for one person
or for a group of people, it was always localized to an extent. It was never this systemic network-wide
catastrophe. And as a sort of collective, we're able to learn from those things and move forward.
So as long as we keep experimenting, as long as we keep making mistakes and learning from them,
we will get to that point. It's very, very difficult, though, to make predictions when it
comes to software. It's difficult to make predictions even when you're like writing a single
feature for software to predict if it's going to take you like one day or a few days or a week or
whatever, but then trying to do a prediction of this entire global network and with all the layers
of complexity that go on behind that, it becomes exponentially more difficult to predict how long
it will be. But I think that in general, you know, we probably overestimate how much work
can get done in the short term, and then we underestimate how much work can get done in the
long term because it does kind of compound over time. So I don't have a specific number for you,
but I think that like every year that we go forward in this space, when I look back a year
or so, I'm usually amazed by how much has been accomplished. So I figure if that continues to be
the case, you know, a year from now, we'll look back and say, wow, you know, we got a lot done.
Just in 2018, Lightning Network had crazy levels of growth. And I think if that level of growth is
sustained, then, you know, it is only a matter of time, a matter of years before we can get to the
point where this technology becomes potentially mainstream adopted.
Yeah, I mean, I run my autopilot, and I know that's like just pretty much running around my
node on the most dangerous level right now. So yeah, that's kind of fun to see it just suck all
my active Bitcoin away, open random channels that no one gives me back.
Oh, yeah. And I mean, that's the thing is like autopilot right now is extremely dumb, naive
technology, where it's just going out and the algorithm behind it is very random, it's just like
randomly opening channels. And a future iteration of autopilot is going to need to be a lot smarter
economically, to figure out, you know, where are the parts of the network that could have the most
improvement by having additional liquidity added to them, and can therefore, you know, get you the
most fees by having money routed through you. So there's a lot of interesting like network analysis,
and also economic like liquidity analysis that is going to need to happen as the network continues
to grow, where, you know, networking in general is not a new thing. But I'm not aware of any
comparable type of like economic real time network modeling on this scale that has ever happened
before. So that's, that's, I think one of the biggest technical challenges that we're going to
have to continue experimenting with and screwing up and, and learning from, if this thing is going
to get to like global mainstream adoption. Yeah, I mean, it's just goes back to the traveling
salesman problem. And, you know, that's something that Lightning Network would definitely, you know,
especially with the autopilot is going to have a hard time getting past. But, I mean, I was just
looking at, I forgot what website it was, where you can see all the channels opening and closing,
and then they post their fee. I was playing around with that and just, you know, seeing who's most
active there, and opening channels with them, and then trying to communicate with other people that
I know in the community that have Lightning Network, and we open up maximum channels, and then
that helps a lot. So, I think it's going to be interesting to see the model around Lightning
Network and the economics that will come from it, because it's, it's, it's actually a really,
really interesting model. Like you said, there's nothing else like it. So I'm excited.
Yeah, and you know, James, and I know as we're, as we're wrapping up here, and I appreciate you
taking the time to speak with us today, what I would really love is if you could let our listeners
know, not only how can they, they find and follow you online, but also, what can they do to support
your work at CASA?
Well, it's easy to find me. If you Google my name, I'm the first result of what I've done.
You can also just go to my website, it's lop.net, l-o-p-p dot net. I've got all of my educational
resources, all of my articles, videos, presentations, whatnot, are archived on there.
Probably at least like a year's worth of material, if anybody actually wanted to go through all of it.
But, you know, at CASA, we just need more adoption so that people can tell us what we're screwing up,
so that we can fix it and make it better. And we've got, we've already got, you know, lots of users
giving us great feedback, both for our node product and for our wallet product. And we're just
continuing to iterate and trying to work our way around some of the complexities, especially with
the Lightning Network. I would say one of our biggest challenges that we've had over the past
few months is that, unfortunately, a lot of our early adopters are extremely technical users, and
they've actually been asking us for extremely technical features and, you know, helping them do
stuff under the hood. And we've been pushing back against that. We don't want to overcomplicate the
UI and put in a bunch of advanced functionality that would overwhelm the average person. So we're
just trying to find the right balance there between giving a person full control over what's happening
with their node versus making it an easy solution to the problem. So, you know, we're trying to
make it easy to use the seamless user experience. Yeah, give me the login for my node. Yeah, we can
definitely give you the login that will void your warranty because I can tell you that a lot of
people who have started messing around on the command line have managed to screw up their node
because basically the CASA node runs like seven or eight different Dockerized services. And what
we've actually found is it's very easy for people to, like, install other software, and then that
just screws up the whole networking stack and random things break, and it becomes a real pain
for us to diagnose. All right, I won't do that. Nevermind. Well, guys, is there any anything else
that you'd like to ask Jameson before we let him go here? No, not really. No, all I want to say is
people call me a jerk and Jameson just told you to Google it. So there you go. Yeah. Yes. It's very
important. We have all these all these resources at our fingertips that we just don't take advantage
of. But Jameson, seriously, thank you so much for taking the time out of your Saturday to spend it
with us. We appreciate it. I'm sure our listeners will appreciate it as well. And to our listeners,
we are so appreciative that you continue to tune into the Hashrate Crypto Mining Podcast. It is
March 9th. This show will be coming out in just over two weeks. So until then,
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