Bitcoin Tech Talk #316

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What I've been working on

  1. Bitcoin is moral - My talk from BTC22 in Innsbruck is now up. I talked about morals and how fiat is a cesspool of theft. The conversation was interesting in that I had some libertarian assumptions that Rahim helpfully brought out. In that sense, once you accept certain premises about the importance of individual liberty and freedom, the rest flows, including Austrian economics and Bitcoin. Worth a listen for those of you that want to convince people at the moral level and not just a financial one.

  2. Fiat delenda est - My talk from BitBlockBoom is up. I talked about why we must focus on the destruction of fiat as it’s an evil that will cause nothing less than the destruction of civilization. The talk has a bit of lessons on Latin, history of the phrase and more. The action steps of really fighting against the fiat regime is the main takeaway and we need to build in this direction.

  3. Lugano - This Swiss town near the border of Italy has been a beautiful treat! I quite enjoyed not just the Plan B Forum, but the city’s natural beauty. I sadly didn’t pay for anything in the city with Lightning, but did buy some things at the conference, like this children’s book.

What I'm up to

  1. SatsConf - I will be in Sao Paolo for this conference and will be eating a good amount of Brazilian BBQ! This is a first edition of the conference, but looks to be a good one for the people in South America. If you’re in the area, please stop by and enjoy this Bitcoin-only conference!

  2. laBitConf - I will be traveling afterwards to Buenos Aires for the 10th edition of this conference. Again, I will be partaking in a lot of beef and will be enjoying the country in my time there. It should be a lot of fun, as these conferences generally are and there will be a lot of announcements, I’m sure.

  3. Converting Bitcoin - I’m still at a loss as to how to conveniently convert Bitcoin to local currency as I travel. Bitcoin ATMs generally take a while for confirmations before dispensing fiat currency and few Lightning ATMs actually let you withdraw. If anyone has tips in Brazil/Argentina to do this, please let me know.

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Bitcoin

  1. Leveraging Verifier’s Dilemma - A paper looks at a novel type of selfish-mining attack, called the dual private chain attack using some significant portion of the network hash rate. The main mechanism for the attack is using the verifier’s dilemma, where the header for a block is sent but the full block withheld. The main idea is to get honest miners to build on the header by withholding the full block. It’s an interesting attack and one I think will be figured out in a realistic scenario, but the paper is worth reading.

  2. Mempool relay policy - AJ Towns has a very thoughtful post on implenting full Replace-by-Fee and the behavior of each individual node’s mempool. The concerns he raises, like how nodes peer more or less randomly now but will be peering differently based on mempool relay policies, is definitely worth thinking about. Yet full RBF has some attack vectors, like spamming a node with tiny increases in fee, for example, which require some customization. The whole discussion is worth reading.

  3. Bitcoin Dev Funding - This Bitmex presentation shows who is funding, who is being funded and the history of the Bitcoin development grants. As shown in the presentation, much of the current funding environment is new to the past few years. As more companies make this a part of their budget, the developer ecosystem should get more robust. Unlike altcoin ecosystems, the money seems to be a good incentive to do good work as the grants are more scarce than the devs rather than the other way around.

Lightning

  1. Kollider Exchange - Kollider is really going Lightning Native with their exchange, allowing, for example, the ability to just log in with Lightning, fund it with lightning and so on. I’m not sure how the fiat side of the equation will work, but if you add a Taro-based stablecoin, this may make it pretty attractive as a non-KYC exchange. I’m not sure how regulators are going to see something like this, but I can see this being a good place to hedge with derivatives.

  2. TARO doubts - Speaking of TARO, Shinobi casts some shade on how it’ll work. The problem as it stands is that you either need channels that are the asset you want to transfer the entire route, or have to have some tricky exchanging at each hop of the route. As he points out, neither are realistically implementable at the moment.

  3. Amboss Release - This article goes over the new release of ThunderHub, but also gives a nice discourse on why you need inbound liquidity and good reporting on channel balances. These sort of statistics are very important for routing nodes as their incomes depend on getting large volumes of payments made through it. As I’ve predicted in the past, the lightning software ecosystem is largely bifurcating between end user and router. This is good and expected and bodes well for its continued evolution.

  4. Zion v2 - The decentralized social network is now built using Block’s Web5 protocol. The payment layer is all lightning and they are using Web5’s DID tech for identity. I really hope a lot of lightning node in a box operators will be incorporating this in their boxes as this is the way to cut out the very lucrative middle-men, the social networking companies, out. Perhaps this can solve the current SMTP problem of being centralized mostly around gmail.

Economics, Engineering, Etc.

  1. Digital Dystopia - Jameson Lopp has a dystopian vision of what everything will look like in 10-15 years as CBDCs, tracking and much more take over. The piece is a great reminder that unless we resist tyranny, the natural tendency of governments is to restrict our freedoms so that they can have more power. I hate to say it, but it’s going to take some political effort to resist the new world order that’s coming post-COVID.

  2. Core Scientific in Trouble - It’s not a bear market unless there’s someone going bankrupt! Looks like Core Scientific is on its way as it’s past due on a lot of the bills they need to pay. The problem with mining is that it’s very difficult to plan for a bear market during a bull market. There’s a break-even price point and if you invest and the price goes below that, then you are pretty much screwed. As I’ve told many people, don’t get into mining unless you’re either willing to lose money or you’re an expert on energy sourcing, data center hosting and ASIC sourcing.

  3. Monetary Censorship on the Rise - The article points out that PayPal is being used as a way to defund politically inconvenient organizations, like Gays against Grooming. People on the right are more open to alternatives exactly because of the political ramifications. There’s a huge opportunity to get many of them on board which I’m sure someone will take advantage of.

  4. Bitcoin as hedge - The article focuses on the British Pound, but for non-dollar currencies, this same phenomenon of high volatility in the currency causing a large influx into Bitcoin is a common occurrence. As more inflation comes into not just developing countries, but established countries trying to follow US monetary policy, will we see a lot more Bitcoin adoption? It sure seems like there’s some momentum in that direction.

Quick Hits

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Fiat delenda est.

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