Bitcoin Tech Talk #481
Interesting Stuff
Derisking Leads to Overfitting - writes about overfitting, specifically as how it shows up in culture. This is the phenomenon where we see logos, cars, movies, even people looking more and more similar as the variety reduces. As with the phenomenon of model collapse, the copy of a copy of a copy ends up pretty bland and meaningless. What’s unsaid is that the overfitting phenomenon is a fiat money phenomenon where everything is de-risked as much as possible. When everything is funded through loans, every project requires approval from some bureaucrat, which act like AI filters. Is it any wonder that the results are bland and boring?
Nihilism of Bryan Johnson - writes about Bryan Johnson, who has been spending millions every year in an attempt to live forever. The article isn’t about the actual protocols being followed by the would-be immortal, but rather his telos, or drive. What surprised me is how devoid of meaning Bryan’s philosophy is. Yet in a way, his pursuit of immortality makes sense, as he has rejected God, his family and even living to a degree and thus all possibility of meaning. What else is there other than living longer if there’s no afterlife or even legacy? His is what it looks like to have biological life without spiritual life.
Amish History - has a review of a book on the Amish and their many splits. The article starts with the history of these people, starting with the reason for their immigration to America in the first place. They were concerned that their children were getting corrupted by the modern world and would not keep their traditions, something parents in every generation have worried about. There have been many splits among the Amish, including some that allow use of tractors, for example and others that do not. The main thing I got from this article is that these people think deeply about technology’s effect on their community and religious life, something moderns don’t really do much of.
Reinterpreting Fight Club - This is one of the most insightful analyses of one of my favorite movies. writes about meaning in the modern world in a 3-part series through an analysis of the movie Fight Club, the third of which is linked here. The article goes through the nihilistic framing of the book, where everything is drab, dull and boring because there’s little meaning to be had. The main insight is that the protagonist attempts to create meaning through not just rejection of the 9-to-5, but through a different order. Yet as the article points out, the community and purpose created in the movie are ultimately just as empty because there’s still no transcendence, no reality beyond the drab, dull and boring one of the here and now.
Gift Cards - This article is probably more information about gift cards than you probably wanted to know, but how these systems work is fascinating. As with most payment systems, gifts cards are pretty heavily regulated, and besides Bitcoin, is one of the most frequent methods by which internet fraudsters get paid. The reason is largely due to the regulation around it, which is such that regulators specifically don’t go after gift card fraud under a certain amount. The article reminded me that there are many unintended consequences of laws, and the fact that gift cards are used to defraud AARP members, for example, is one of those.
What I'm up to
Book Review - I reviewed the book Leaving a Legacy by Johann Kurtz, who I had on my podcast a couple weeks ago. If you’re interested in the topic of creating a family legacy, you should look at the review and the book!
The Bitcoin Group - I was on the show to talk about Bitcoin mining in Ukraine, Saylor’s cash stash and Nakamoto (the company) possibly being delisted. It’s always a fun show to do and despite the sideways price action, it was a lively discussion.
Max and Stacy Bitcoin Invitational - I will be at this event in El Salvador on January 8-10. Besides Bitcoin, there will be golf, pickleball and poker among other things.
Nostr Note of the Week
What I’m Promoting
Bitcoin
Jungle Mesh - Offline payments for Bitcoin have been one of the trickier things to figure out and this post offers what they hope is a solution. The main use case being solved is something like the markets at Bitcoin Jungle in Costa Rica. The author proposes using a bluetooth Bitchat-like mesh network and using Cashu tokens to actually spend Bitcoin. The mesh network would have to enforce Cashu-non-double-spending. The author acknowledges the trust required for the system, but wonders if this could be something that can work. I personally think a Starlink node and a wifi router would be easier, but it’s cool to think about these things.
Bitcoin Lockbox - This is a service that lets you send timelocked Bitcoin. You could, of course, do this using Bitcoin Script, but as I’ve opined in the past, few wallets have this functionality as it’s a bit of a UX nightmare. The idea is to remind whoever is gifted the Bitcoin is reminded on a regular basis of the coins that are waiting for them via email. The problem for me is that there’s little guarantee that this company will be around years from now when the gift might be retrievable, and even with a non-custodial solution, the recipient could very easily forget that they have timelocked Bitcoin as a result.
Mailing List Drama - Greg Maxwell has suggested that anyone suggesting any sort of UTXO confiscation be banned from the bitcoin-dev mailing list along with the company they work for. This has understandably caused a bit of consternation not only on the mailing list but on X. The main concern, of course, is that such an act centralizes bitcoin technical discussion and gives too much power to whoever is in charge of enforcing something like the ban he suggests. The post is a reminder that centralized shortcuts are very tempting and are the reason why decentralized systems are so difficult to produce.
Lightning
Core Lightning + Zeus Guide - If you want to run your own Lightning node and have it connect to your phone wallet, this is a nice guide for you. The guide expects you to run a lot of commands on command-line, specifically Ubuntu. You can then set up your phone wallet to connect to the Core Lightning instance. The guide is a good way to set up on testnet and play with things before putting real money into your own self-hosted lightning node.
LQWD - This is a Canadian Bitcoin treasury company that also runs Lightning Nodes. Apparently, they run a lot of routing nodes and managed to route ~2000 Bitcoin. While I don’t think the prospects for treasury companies is really that great, the strategy of this particular treasury company at least makes plausible the idea that you can run one by putting your Bitcoin to work, routing payments on Lightning.
Lightning Payment Record - Apparently a 1.24 BTC payment was routed over lightning and is a new record. This is a bit surprising to me since Lightning has been around a while including during the 2020 bear market when BTC hit a low of $3500. Of course, the USD amount has changed significantly since then and it’s good to know that 6-figure amounts can be routed, though probably not easily. At some point we will see figures like this get beat regularly if Lightning becomes more ubiquitous for payments.
Economics, Engineering, Etc.
OG BTC - The advent of ETFs have essentially financialized Bitcoin. Or so it seems after reading this post by an early Bitcoiner that has divested his holdings and put whatever Bitcoin exposure into ETFs. The reasoning is easy to understand. It’s a lot easier to get loans against ETF shares than self-custodied Bitcoin and if you don’t want to sell, the rates you can get are much better with ETF shares. This also adds paper Bitcoin risk to the system, which unfortunately is something fiat loans do to every asset.
Strategy Stacking USD - The Bitcoin treasury company has increased its USD reserve to $2.2B. This is an unusual move for the company as they have generally used loans to buy Bitcoin, not keep it as a reserve. The purpose seems to be to make sure that they have enough to cover dividend payments that are coming due for their various financial instruments like STRC without having to sell the Bitcoin on their balance sheet. This suggests that they at least think a Bitcoin bear market is a possibility, if not likely.
IMF BTC and El Salvador - There have been a lot of speculations about exactly what the deal is between these two entities, and according to this story, the deal actually hasn’t been negotiated completely yet. The article suggests that the fate of Chivo Wallet hasn’t been settled, for example. Is El Salvador still allowed to stack sats? What restrictions do they have from the IMF? Are there understandings that go beyond what they wrote down on paper? It’s hard to tell and I hope for the sake of the people of El Salvador that they can continue to develop their country.
Quick Hits
Trust Wallet Vulnerability - The unfortunately named web wallet has an exploit and should not be used.
Oslo Airport - The Duty Free shop at the airport now takes Lightning for payment.
Cramer Bearish - The stock picker who people love to go against has a low sentiment on Bitcoin.
Lummis Retiring - Bitcoin’s biggest advocate in Congress will finish her term in 2026.
Fiat delenda est.