Bitcoin Tech Talk #431
Interesting Stuff
Turn Toward Hedonism - The essay starts with an analysis of whether art follows culture or culture follows art. And indeed, that part is interesting enough, but the more insightful point made in the article is about how there’s been a turn from lives that had purpose or accomplishment, to lives that pursue consumption. There’s even a big middle part that shows why with the economic incentives at play which, though unmentioned, come from the advent of fiat money. The depressing art landscape that we find ourselves in, in other words, comes from the despair of an economy built on theft.
Tolkien and Lewis Predictions - The article is long but worth reading, and it’s about a few of C.S. Lewis’s works (and Tolkien and some others) which predicted a lot of what we see now, or at least gives us a good frame for analyzing what’s going on. The evils of the current world were in many ways predicted by both, Tolkien in his fiction, Lewis in both his fiction and non-fiction. For them it was the denial of human nature, an attempt to make man something else, which was the future that they saw coming in an age infected with subjective moral values. Yet in complete subjectivity is a deep emptiness and eventually a lingering hatred, which infects those in charge. These are the consequences of vesting too much power in the few through money printing.
Zombie Fields - The article is about how Psychology in particular is a failed discipline, with lots and lots of evidence to show why. But the more important point is that it’s essentially become a zombie field, where nothing productive is happening and yet consumes lots of resources. This is a similar concept to zombie companies, but more for an academic setting. Fiat money has this effect where life is drained and animated only through subsidization via theft and psychology is only one of many such academic subjects.
Hidden Innovation - I’ve argued many times that we’re getting much less innovation due to fiat money and all the rent seeking, but here’s an article that challenges the idea. The argument by the author is that there are just as many innovations, it’s just that they’re much less visible because they’re mostly around self-actualization, or the top of Mazlow’s heirarchy of needs. In other words, people are demanding more self-centered innovations as they get more comfortable. While there’s merit to the idea, I think the self-centeredness is much more the result of the prevalence of advertising, which comes from a consumption and debt-based society, which ultimately comes from fiat money.
AI Stupidity - This is a long screed by a data scientist about the stupidity of the people talking up AI. There’s a lot of truth in there about the LARPing of the many managerial types who hype this stuff, and the most interesting part for me was his analysis of why such people do the hyping. They’re all incentivized to claim successes to their superiors to get promoted, and given that their superiors don’t know what they’re talking about, there’s a lot of deceit and fakery. We saw this with “blockchain” and “quantum” in the past and sadly, this is what happens when you have a company with too many rent-seekers.
What I'm up to
Brian Paik - This is part 1 of the interview of my friend’s YouTube show in Korea which we recorded on Christmas Eve. We talked about the Korean market’s affinity toward altcoins in particular and risk in particular, the trust-based society that it is and how it’s affected the marketing success of altcoins and how Bitcoin has had a harder time getting the truth out there because of the altcoin marketing. I found it interesting that Brian’s now praying every morning and reading the Bible despite not being a Christian as part of his journey.
Gospel According to Bitcoin - I wrote the foreword for this book as it’s a book that once again combines Christianity and Bitcoin. It’s a really cool read and a reflection on the different aspects of both Christianity and Bitcoin that are often neglected as a result of the fiat monetary system that we all live under.
Plan B El Salvador - I’ll be at this conference later this month and it looks like I’ll be coming a day early to attend some extra events that are planned. Stay tuned on the details of those events if you’re planning to be there.
Nostr Note of the Week
What I’m Promoting
Bitcoin
DLC Factories - Discreet Log Contracts have been in use in Bitcoin for some time and have been used for passive oracle-settled options contracts and bets. Unfortunately, they require onchain transactions for each bet so tends to bloat the chain a bit. Here is a very clever way to extend this concept so the two parties can settle multiple, and perhaps ongoing, contracts with a single UTXO. It’s a lot like Lightning in that there’s commitment and settlement transactions and in-between states that get updated. Hence it’s called a DLC factory because you can create lots of individual DLCs that get settled on a single UTXO. Great concept, though I’m not certain it’ll find a market.
Coinswap - The v0.1 Beta of this trustless coin swapping software is out. The basic idea behind this protocol is that there’s an atomic swap of UTXOs from 2-of-2 HTLCs, making for some amount of anonymization. The idea is sound, but the scalability of the protocol is a bit hard to see given the on-chain footprint. Much like the many different coin mixing protocols, it’s all about getting traction since you’re only as good as your anonymity set.
Live Wallet - This is a project to analyze your UTXOs for the purposes of privacy and fees and it even supports multisig. The idea is that you can find out which transactions leaked what and it supports labeling certain transactions as being KYC’d. We need more tools like this to give users the ability to craft their own transactions as coin control just isn’t enough. I think a wallet that incorporates this analysis or a plugin that does something like this would be very popular.
Lightning
BitcoinFax - There aren’t many reasons to send a fax these days, but if you have one, you can use this service which lets you upload a PDF and a fax number to send it to for a lightning payment. The service is especially nice because it really doesn’t know anything about you, though I suppose it can be used to spam someone’s fax machine. I wonder how many services that could be viable as non-kyc gateways to normal services.
Lightning vs Credit Cards - Pete St. Onge analyzes the math behind the lightning network transactions and concludes that it would be a huge boon to the economy given the current entrenchment of players like Visa. But that’s why it’s also very difficult to displace the incumbents because they’re so in bed with the government and have a state-sponsored monopoly. As such it’ll take some time, but hyperbitcoinization as much more likely because of Lightning’s existence.
Mostro - This is a project to do peer-to-peer Bitcoin trading using lightning and Nostr. Think of it like what localbitcoins used to be but decentralized like Nostr. Anyone can run a Mostro server and that is essentially the marketplace where you can trade peer-to-peer. The really nice thing about lightning in this case is that it has the added benefit of leaving no on-chain footprint. As more exchanges demand KYC, a tech like this will hopefully become more ubiquitous.
Economics, Engineering, Etc.
HRF Finney Prize - HRF created the Hal Finney prize last year to celebrate Hal Finney, the legendary cypherpunk and early Bitcoin supporter. The prize is given out every halving, but since we’ve had 4 halvings already, they are rewarding the Finney prize each year until the next halving. The first winner was Hal Finney for his work from 2009-2012. The second epoch (2012-2016) winners are Greg Maxwell and Pieter Wuille. They have worked on Bitcoin in more ways than Core, but their status as legends was already secure before this prize. Congrats to both of them!
US Selling 69500 BTC - The Biden administration seems hell-bent on making the Strategic Bitcoin Reserve harder and harder, as they got court approval to sell the 69500 BTC that they seized from a Silk Road-related case in 2020. This is currently worth around $6.5B, so it’s a lot of money in ordinary terms, though peanuts to a government running $3T deficits per year. The sale is being conducted by the DoJ which is under the executive branch and it seems like it’s a race against time to see if they’ll sell the Bitcoin before Trump takes office.
Top 21 Holders - River has a Forbes-Richest-like list for Bitcoin. These are organizations and individuals that have publicly stated their Bitcoin position. Much like the Forbes list, it’s only based on public statements and such, so it’s very hard to know how accurate it is and indeed, it’s almost certain that there are individuals that would belong on this list but are keeping private. Still, it’s an interesting view of who got in when and why they have so much.
Quick Hits
1070 BTC - More corn for MSTR, though they seem to be slowing down as Bitcoin price stagnates a bit.
Landfill Not Getting Excavated - The guy who threw out a hard drive with 7500-8000 BTC on it is not getting to look through the landfill for his bounty.
Meta Shareholder Proposal - Like Microsoft, it looks like Meta will have a proposal for a BTC treasury up for a vote.
Court Orders Private Key Reveal - The man in question has $124M in crypto holdings that a judge has said he needs to reveal the “access codes” to, which presumably means his private keys.
Fiat delenda est.