Bitcoin Tech Talk #477
Interesting Stuff
Scams and Values - We talk a lot about scams in the Bitcoin community, obviously because there are so many in altcoinland. Terminally_Drifting has this article on what kind of scams are run by whom, and what it says about the cultures that produce them. As scams are now global, there are a lot of different scams that the article covers, including Nigerian, Russian, Chinese, Latin American and even Jamaican scams. The article points out that the scams reflect the values of the culture, some high time preference, others low time preference. What the article made me think about is what scam are Americans running, and I came to the conclusion it’s the dollar hegemony, which is done at a scale that dwarfs all the others.
Cultural Collapse - Ted Gioia writes about arts and entertainment, and specifically how uninfluential they are compared to previous eras. As he points out, few people care about the Oscars or the Grammys anymore largely because most people have recognized that the popularity of these things are rigged, and refuse to play these games, opting out. The collapse of the arts, he notes is gradual, then sudden. And indeed, that’s what seems to be happening in all these fiat systems. It’s not just Hollywood and Music, but also College and of course, central banking.
H1B Visa Abuse - Matt Forney writes an investigative report on Capital One’s abuse of the H1B Visa system and the takeover of the company by ethnic Indians at all levels. The allegations are disturbing, not just because there are so many grifting from the company’s political connections, but because of how pervasive the problem seems to be. Apparently, any non-Indian at the company gets discriminated against and H1B Indian workers are made to work like slaves. This is next-level rent-seeking.
Weight Loss Drugs - Raw Egg Nationalist makes the case that a Weight Loss Drug company will be the highest market cap company in the next 10 years. He makes this case based on the fact that an easier GLP-1 drug, likely a pill version coming in the next year will make these drugs more accessible than ever and thus, more profitable than ever. This is in contrast to the AI-driven tech stock boom, which is racking up some impressive debt for these companies (see next story) with unclear paths to profitability. The market for weight loss, on the other hand, is likely to be enormous, given the percentage of people that are obese.
Debt-Driven Growth - Speaking of which, Alberto Romero shows just how much of the current AI-building out is on the back of debt, rather than profit. Not only are the big tech giants issuing bonds (taking out debt in public markets) to finance their data facilities necessary for AI, but they’re also using SPVs (Special Purpose Vehicles), leveraging private equity to fund these very expensive computing farms. This seems like a setup for the mother of all bubbles, where if things don’t go almost perfectly, there will be a huge financial reckoning, perhaps even bailouts on the horizon.
What I'm up to
Lugano Spam Debate - The debate I had with Peter Todd is up, and as I commented before, it was a bit farcical as Peter did not prepare for the debate and had no opening statement at all. The unpreparedness would have at least been funny if he wasn’t so convinced that this was a good thing.
Thank God for Bitcoin Second Edition - The book is on its way and should be available in the next couple weeks.
Conversation with Russell Brand and Max Keiser - I got roped into this half-way through, and I will be posting it in the next week or so.
Nostr Note of the Week
What I’m Promoting
Bitcoin
Penlock - If you want to back up a seed phrase but don’t want the seed phrase in a single place, this is a very interesting option. The main idea is to split a 12-word seed phrase into a 2-of-3 backup, but instead of using a computer to split this up, it uses a printable paper wheel. It uses some clever cryptography under the hood and what you end up with in your shares are other seed phrases that can get combined to recover your 12-word seed. Honestly, the makers should make these wheels available for sale as it mitigates the evil maid attack.
NodeWatch - This is a cool little site to examine a Bitcoin node and see how healthy it is. The main measurements are what services it offers, how synced it is, whether it’s blocks-only or transaction relaying, and how advanced the protocol version is. It’s something like a whatismyip site, but for understanding what the node software is running and with what options. There really aren’t that many nodes, so something like this with more aggregate data that you can drill down to would be very useful, especially as nodes become more discriminating as to the peers that they want to connect to.
Bitcoinbackbone - This is a Rust + libbitcoinkernel full node. There have been a lot of alternate node implementations in different languages like btcd (Go) and bcoin (javascript), but this is the first I’ve heard of that’s using Rust. The fact that it’s using libbitcoinkernel means that it should be consensus compatible with Core, perhaps moreso than others. What I find interesting is that the project is specifically *not* hosted on Github and instead contributors are encouraged to use the git protocol.
Lightning
Blue Wallet Arkade - The mobile wallet that used to have lightning but removed it may add it again using Arkade. The big problem with offering lightning in a wallet is all the management on the backend with channels and servers and so on, which is why Blue Wallet removed the feature in the first place. But now that we have lightning-compatible protocols like Ark, the feature can be more plug and play with less demanded from the wallet developer. It’s entirely possible that this is the direction that lightning development goes in as developers have to worry less about the nitty gritty of lightning and instead use something a bit simpler that can do lightning on the backend for interoperability.
BoltCanvas - This is a super lightweight server that uses lightning natively to sell products. It can hook into lnd, BTCPay Server or Blink on the backend to create the invoices. You can even take on-chain payments which actually come in as lightning payments via Boltz. The super-easy setup is pretty remarkable, given how laborious it used to be to set up a web shop, though that’s largely been mitigated by centralized platforms. The fact that it’s almost as easy to make one in a decentralized way is truly amazing.
lnemail - This is a project for creating disposable email addresses. You don’t need to sign up or verify anything and you pay for the service using lightning. There are, of course, many different uses for something like this, as email is ubiquitous and the signups pretty onerous. The nice thing about these email addresses is that they’re valid for a year, but can be renewed, so you retain the option of continuing to use them. I hope at some point a complete pseudonymity pack for online interaction becomes something you can pay for.
Economics, Engineering, Etc.
The Real Poverty Line - The perniciousness of inflation is almost always underestimated, and this article shows through one particular measure, that is, the poverty line, how what’s considered subsistence wages is grossly inadequate. As the article shows, the concept was created in 1965 when food was still about 1/3 of household cost, where as it’s closer to 1/20 of household cost today. If you adjust according to actual costs, the real poverty line according to the author is $140k for a family of 4 in the US! The article has a lot of other goodies, like the fact that there are various malincentives at $45,000 and $65,000 that make it so that it’s economically rational for families to earn under that amount than to earn $10,000 more due to tax subsidies available.
Merchant Adoption Study - This is a paper on merchants that take Bitcoin, and it has interesting insights on how merchants adopt. First, national-level adoption, like the national Bitcoin law, doesn’t actually do all that much compared to ground-level, bottom-up adoption at the community level. Second, the main adopters tend to be in the hospitality industry, like restaurants, bars, cafes, hotels and so on. These are usually how new payment methods start, and only after some time at this level does adoption happen at the deeper levels like more long-term retail and eventually services.
Samourai Wallet Founders Sentenced - Bill Hill, one of the founders, got 4 years while the other founder, Keonne Rodriguez received 5 years. They operated Whirlpool, which was a coin mixing service, and their crime was money laundering. Money laundering is, of course, the most artificial of crimes with no basis on Natural Law and instead something enforced by the state for the purposes of choke-pointing other crimes.
Quick Hits
Midwit Quantum Take - The rising star writes an utterly ignorant take on Bitcoin and quantum, ignoring the obvious like the fact that they can’t even factor 21 yet (or really 15).
$5M for Texas - Texas has started accumulating Bitcoin, starting with this $5M purchase, with another $5M allocated for future purchases.
Cluster Mempool - The 2-year running pull request has finally been merged that determines transactions staying in the mempool based on their dependencies.
Lazarus Upbit - The North Korean hacker group apparently has hacked the South Korean exchange for $30M.
Fiat delenda est.
Aside: I love how this still very much feels like “Jimmy Song”; no AI mashups as far as I can tell. And these breakdowns have become a top centerpiece for my content consumption, a trusted voice when I don’t have time to review all the other feeds.