Bitcoin Tech Talk #452
Interesting Stuff
Science Woes - I’ve shared a lot of articles about how scientific progress has largely slowed down and how innovation has shrunk significantly. This article tries to explain why this is happening and lays the blame on a lot of different things, like the focus on efficiency or iterative improvements, the current replication crisis which points to a lot of skewed incentives, bureaucratization brought on by rent-seeking, and DEI/feminization which has prioritized political ends rather than scientific truth. The skewed incentives are almost all motivated by fiat money printing and the centralization of science, which unfortunately has meant that progress has largely slowed down and even reversed.
Shared Values - I rarely, if ever, share government articles in the Interesting Stuff part of the newsletter. In fact, this is the first one I can recall, so it’s as much a surprise to me as it might be to you. It’s intriguingly published on Substack of all places by Marco Rubio’s State Department about the need for shared values with Europe. The article is a repudiation of the globalist agenda and a call to re-embrace values like free speech, secure borders and fair elections. I was impressed by how cogent the argument was, though it’s obviously political and reflects the current administration. But more importantly, the tone and the fact that it’s published on a platform like substack are a surprising bow to populism, which the current administration’s embrace of Bitcoin also is.
Societal Purpose - This is one of those articles that frustrate me because it gets the diagnosis largely right, but the cure completely wrong. The article looks at global fertility rates and how quickly the demographic time bomb is coming and correctly identifies that people essentially lack hope. Indeed, the insight that large portions of society have become rent-seeking consumption machines whereas a couple of generations ago, they were production machines is useful and points to a deeper spiritual problem. But the solution is the typical technocratic Keynesian dream of having something, anything, that unites humanity toward a singular purpose like space exploration. The problems of fiat money are obvious to everyone, even if the solutions are blinded by bad economics.
Living Cheaply - The Gen Z and Millenial complaint is that housing is unaffordable and that hope is largely lacking due to the selfishness of previous generations. Indeed, there’s a lot of merit in this view, as a lot of the wealth of previous generations has been spent frivolously. Yet, as this article shows, it’s actually not hard to own property and live cheaply in the US ($432/month on half an acre, cue the selling chairs meme for Bitcoiners). The problem isn’t about the cost of living in the US, it’s really the cost of living in dense, desirable places with modern, upper-middle class comforts like a 2000 sq ft home, a quick drive to the city and even an automobile. In other words, our desires have grown, even as the money has debased.
The Story of a NYC Station - However inefficient you think bureaucracy is, it’s more inefficient than that. This is the moral that I got out of this story. The story is that of the 1.8 mile Second Avenue station whose planning started almost 100 years ago and has been in regulatory hell almost the entire time. The staggering cost is $4.45 billion dollars, finally opening in 2017 after way too much planning and way too slow construction. The general trend in public works over time is to become slower and more expensive as more rent-seekers collect their rents, and the fact that the NYC subway is one of the oldest in the world means that there’s a lot of cruft which makes building and extending it extremely difficult. In many ways, it’s a microcosm of the world-wide fiat dysfunction.
What I'm up to
Brandon Gentile - I spoke with Brandon about Bitcoin pricing models, the OP_RETURN conflict, having empathy with your future self and, of course, the title, which is why having 0.1 BTC might be enough eventually. It was a fun and long conversation that touched on everything, including Trump’s tariffs, altcoin fatigue, why investing doesn’t make sense once you’re on a Bitcoin standard, the history of colored coins and much more. It was a two hour+ conversation, but it felt shorter, mostly because there was so much to talk about.
Lisbon - I’ll be headed to the city this coming week. If you’re part of a Bitcoin meetup there, please reply to this email and let me know!
Prague - I’ll be in Prague after to speak at BTC Prague. I’ll be giving a talk on Bitcoin price (it’s meant to be a little click-baity) and participating in a debate on the long-term security budget. Hope to see you there!
Nostr Note of the Week
What I’m Promoting
Bitcoin
Bitcoin Core Relay Policy - A bunch of the contributors to Bitcoin Core have published this article about the core client relay policy. It reads very much like a statement to justify merging the controversial OP_RETURN data carrier size pull request, which has been a hot topic for about 6 weeks now. The clear implication from the article is that if you, as a node runner, disagree, that you should run an older version of Core or switch to another client altogether, which is exactly what I believe will happen (and in many was has been happening already).
Plan B Tutorials - This is a large and growing collection of tutorials about almost everything Bitcoin-related, including node setup, wallet setup (software, hardware, etc), mining, point-of-sale and much more. There are even tutorials about contributing to the open source project, like proof-reading tutorials and so on. This is an excellent resource that really needs to be spread more as more people come onto the Bitcoin standard.
Patent Troll v Miners - A patent troll has sued miners Marathon and Core Scientific with some patents that it bought from Blackberry. The weaponization of patents is a tried and true strategy that has plagued the US court system for many decades now and unfortunately, the miners are caught in what’s bound to be an expensive and time-wasting lawsuit. In a sense, this shows how decentralized Bitcoin is as the Elliptic Curve Cryptography patents that the company supposedly owns cannot reasonably sue a decentralized system. Patent lawsuits, by the way, are what is speculated to have caused Satoshi to use the less flexible and more convoluted ECDSA algorithm than the older and more flexible Schnorr Signature algorithm.
Lightning
Boltz Pro - Managing liquidity for Lightning channels is hard and is perhaps the biggest challenge for people trying to make money as a routing node. Boltz is trying to solve that problem for itself using good old fashioned capitalism. Their Boltz Pro platform will pay you to provide liquidity in the direction that they need, for example going from Liquid Bitcoin to Lightning or vice-versa. More services like this may mean a different way to make money as a routing node, that of providing liquidity at the right time to the right players. Indeed, this is the first step of a full liquidity market that is bound to develop as lightning matures.
LNFly - This is what you get when you combine Lightning and Vibe Coding, a platform to create some apps on Alby’s Lighting API. What’s cool is that they already have a bunch of example apps that have been built using the platform that you can fork and modify to your needs. It’s still obviously some work to get everything right, but it’s pretty remarkable how quickly you can at least prototype something.
LNEmail - Anonymous email can be a problem, as free providers sell your data and paid providers have your payment information, which can doxx you. Enter LNEmail, a service that lets you get an anonymous email account which you can pay for in Lightning, ensuring privacy from even the email provider. You get an access token which can then be used to receive email.
Economics, Engineering, Etc.
China Bans Bitcoin Again - I lost track of how many different ways that China has banned Bitcoin, but this explains some of the price action the past week. The order essentially makes owning Bitcoin (and altcoins) illegal in China. This is the result of the anti-Bitcoin policy that China has been pursuing since 2014 or so, starting with exchanges, then mining and now even individual ownership. The main implication is that this sets up China to impose their CBDC on their population, which should make for a nice contrast to Bitcoin.
Bitcoin is MAGA? - So says the Wall Street Journal. Obviously, progressive Bitcoiners are not happy about this association, though, to be fair, Trump is the most pro-Bitcoin president so far. The political stand he’s taken has made it difficult for Democrats to be pro-Bitcoin while maintaining their distance from him, which was probably the intent of the stand in the first place. In reality, though, the bigger backers of Trump are the altcoiners, and a Bitcoin/altcoin political polarization looks inevitable. Which party takes which is the real question.
STRD - In another feat of financial engineering, Strategy is offering perpetual stride preferred stock with this ticker. The essential idea is that this is a preferred stock that pays 10% dividends, subject to board approval and can be redeemed for cash. It looks like a way to get more cash for Strategy so that they can buy more Bitcoin by offering an asset that gives a pretty large USD-denominated yield.
Quick Hits
1088 BTC - A rare week where Strategy got out-stacked by another company, in this case MetaPlanet.
Save Our Wallets - There’s a website to push the Blockchain Certainty Act.
Dark Web Payment? - Wired thinks that the 300 BTC that Ross Ulbricht received is from someone on the dark web.
XXI PoR - Jack Mallers proves that his company has the Bitcoin it claims to have.
California Bill - A bill working through California’s legislature puts Bitcoin and altcoins under the same state seizure statute if it’s abandoned on an exchange.
Fiat delenda est.