Bitcoin Audible – Roundtable 007: "Bitcoin, Babies, and the Bitcoin Dollar"

Host: Guy Swann
Guests: Steve, Bitcoin Mechanic, Jeff
Date: March 5, 2025

Main Theme

This episode of the Bitcoin Audible Roundtable dives into the dynamic crossroads of Bitcoin’s ongoing evolution: the return of USD stablecoins to the Bitcoin ecosystem (especially on the Lightning Network), the increasing complexity and risks in crypto services, the deepening questions around mining centralization, the maturation of bitcoin-backed lending, and the philosophical implications of permissionless money. The crew also marks a personal milestone as host Guy Swann navigates significant life changes—welcoming a new baby into the world!

Detailed Section Summaries

1. Opening & Personal Updates (00:00 – 05:21)

• Guy Swann welcomes the panel and announces his expanding family (“one daughter greater in my family than I did just a few days ago”), celebrating a recent home birth.
• Casual joking about making more Bitcoiners:
  • C: "Bitcoin babies. They say there's not enough women in bitcoin. I'm fixing that one baby at a time." (03:31)
• Light banter: Speculating about the next generation inheriting Bitcoin and the tendency for heirs to sell off stacks they don’t value or understand.

2. Stablecoins Return to Bitcoin & Lightning—What Changes? (05:21 – 14:29)

• Discussion about Tether’s announcement to use Taproot Assets, allowing USD stablecoins to run atop Bitcoin/Lightning.
• Mechanic’s initial skepticism:
  • "From a raw bitcoin standard point of view… it's basically a nothing burger." (05:21)
• Guy’s counterpoint:
  • There’s tangible value in using Bitcoin as the settlement layer and timestamp/ownership registry for stablecoins (09:21).
  • Greater liquidity for Lightning: "It's literally using Bitcoin as a settlement instrument for fiat payments, which I always thought was intuitively the first way it would get built out." (09:21)
• Analogy: Like the internet back-end replacing analog tech without users realizing (10:43).
• Stablecoins could bring users into Bitcoin’s orbit, even if their initial motivation is fiat (11:23).
• Another nail in altcoin utility:
  • "Anything that actually becomes useful will migrate back to Bitcoin... whatever utility that Bitcoin… can provide." (11:43)

3. Lightning Labs, Taproot Assets, and Reliability Concerns (12:46 – 14:29)

• Mechanic raises concerns about reliability:
  • "LND Taproot Assets is an LND thing... the amount of hotfixes and disasters... is shitcoin level, Solana level..." (12:46)
  • But for stablecoins, reliability may not matter—the value is in the middleware.
• Broader landscape: "The last like four or five months with the run to 100,000... Bitcoin has divorced from crypto, and I think this is going to accelerate..." (13:45)

4. Security Failures & The Cost of Complexity (14:29 – 15:24)

• Recent hacks:
  • Bybit ($1.4B), Femex, Solana Bridge ($8M), and Coinbase phishing event ($65M).
  • Complexity in smart contracts (esp. Ethereum) cited as a root risk.

5. Proof of Stake vs. Proof of Work – Political Pressure and Censorship (15:24 – 27:21)

• Proof of Work:
  • Security via physical work, decentralized control.
  • Miners must do real work to reorganize; cost is tangible (21:05).
• Proof of Stake:
  • Political consensus—ownership enables history rewriting; introduces “layers of trust and pretend decentralization.” (16:04)
• Convergence of arguments:
  • The line between the assumptions people make about miners’ self-interest in PoW and stakeholders’ self-interest in PoS is getting blurred.
  • "It's a mentality thing. If you're ever saying why would Bitmain do XYZ... that's a proof of stake argument." (22:53)
• Censorship concerns:
  • Growing fear of mining centralization enabling transaction censoring under national pressure ("Why do you hate America… why do you want to mine blocks that have [sanctioned] activity in it?" – 24:44).
• Cypherpunk resilience:
  • Guy: “Every hour that goes by [without miner attack] it gets exponentially more difficult to actually pull it off. The time factor weighs heavily in the cypherpunk favor.” (26:18)

6. Mining Pool Centralization – Risks & Realities (27:21 – 34:12)

• US-based pools (Foundry, Mara) are distinct from Bitmain-related (Antpool, ViaBTC), but both raise concerns.
• Operator skills gap:
  • Many big miners lack technical expertise to independently change pools or run nodes. Mining is more “blue collar” than “techie.” (31:38)
• Political centralization:
  • At scale, miners must operate with state permission; permissionless operation breaks down at megawatt/enterprise scales.
• Jurisdictional diversity is vital for Bitcoin’s resilience.

7. Political Shifts & Bitcoin as an Exit (34:12 – 41:03)

• Bitcoin empowers new elites to resist old power structures:
  • New pro-bitcoin factions, libertarian interests, and capital flight mechanisms shifting political balances.
  • Bitcoin’s “gravity”—illegal or not, states (and criminals) want access and control (41:03).

8. Mining Pool Diversity – Technical Tools & New Solutions (42:11 – 44:45)

• Ocean Mining’s decentralized payout system:
  • “Other pools pay people, Ocean pays Bitcoin addresses. It doesn’t matter who mines to those addresses.” (44:15)
• No accounts:
  • Enables legal, permissionless mining pool operation with minimal KYC. A unique privacy feature.

9. Block Template Diversity—How Decentralized Is Mining, Really? (49:00 – 55:46)

• Tools to track block template diversity:
  • “Stratum dot work” and “Mempool.space/stratum” are used to assess the variety of mining templates—important for decentralization.
  • Many “small” pools are shown to simply duplicate Bitmain/Antpool templates (called “Cesspool”), undermining perceived diversity.
• Call-out:
  • “It would be like if all the downloads for Ubuntu and Fedora... were just on Microsoft.com. This is... against the whole ethos.” (55:07)

10. UTXOracle – On-Chain Native Bitcoin Price Oracle (55:46 – 68:18)

• Steve describes UTXOracle:
  • Script running on your own node, calculates BTC/USD price using actual settled transactions—“the only genuine bitcoin settled price aggregator” (63:00).
• Advantages:
  • Decentralized, censorship-resistant, can’t be spoofed (unlike exchange APIs or paper markets).
  • Guy: "I'm not asking a third party what the price is. I'm asking myself." (65:04)
• Ideas on integrating this into user interfaces like Mempool.space and increasing its adoption.

11. A Torrent of Hacks—Social Engineering & Technical Vulnerabilities (69:32 – 78:23)

• Recap of major recent hacks:
  • $1.4B Bybit hack (Ethereum, hardware wallet security confusion)
  • $65M Coinbase phishing scam
  • $85M Femex exploit
  • $8M Solana bridge exploit
• Security lesson:
  • Complexity increases the attack surface.
  • Hardware wallets are only as good as what users can actually verify.
  • Guy: "I have better security than Bybit who's holding... billions in ETH because I can just check my hardware wallet." (77:43)
• Cynical take:
  • "We need more hacks... things get better... More hacks!" (78:19)
  • B: "I want Coinbase and the ETF guys to just get absolutely rugged to pieces." (78:30)

12. Bitcoin Culture: The Need for Cypherpunk Leadership & Permissionless Use (79:13 – 84:44)

• Frustration about the complacency introduced by custodians and ETF products.
• Need for cultural leadership:
  • Mechanic: "If Saylor was to just do a stream where he's like, today I'm going to set up my own node… imagine… the tens of thousands of people that would follow straight on." (81:44)
  • The health of Bitcoin depends on retaining a core of “hardcore cypherpunks.”
• Call to arms:
  • Another campaign is needed: "Bitch, run a node." (83:00)
• Levels of Bitcoiner meme:
  • Publicly ranking users by security/hardcore level would encourage healthier habits.
  • KYC coins = "compromised coins" (85:21)

13. Privacy, Fungibility & On-Chain Analysis (86:11 – 89:39)

• Fungibility concerns: assigning labels to “tainted” or “kyc” coins undermines the protocol.
• How to obfuscate on-chain activity—mixing, random payment amounts, coin join techniques, and round-number avoidance.

14. Bitcoin-Backed Lending, Multisig, and the Birth of Bitcoin Economy Primitives (89:59 – 95:42)

• Explosion of BTC-collateralized lending services: Blockstream, Stoneridge & Bakkt, Galloy’s Lana, Onramp.
• The future of credit:
  • Multisig and shared custody enable “provable, one-to-one, bitcoin-backed e-cash,” privacy, and global scaling.
• Macro impact:
  • Lower interest rates than expected BTC returns; enables buying dips, smoothing cycles, and building a robust, non-manipulated credit market.

15. Fold, Credit Cards, and International Access (95:56 – 96:51)

• Fold's bitcoin credit card and its slow rollout beyond the US.
• Frustration with regional fintech rollouts.

16. IMF, El Salvador, and Geopolitical Game Theory (97:24 – 103:08)

• El Salvador’s Bitcoin strategy may be hamstrung by IMF loan restrictions.
• Difficulties in establishing long-term certainty for expats and investors—reliance on a single regime is risky.
• Guy: "How stable is this really...what happens when [the president] is out of office?" (102:13)

17. Additional News Bites (Post-Roundtable Wrap-up) (104:21 – end)

• Kidnappings underscore the risks of public Bitcoin wealth—“carry, train, protect yourself.”
• Mining pool hash rate further consolidated—up to 35% with Antpool in the lead, but fixable via better tools and adoption.
• US government attempts to claim that “money isn’t property” in a legal context—Guy provides a detailed philosophical critique.
• France bans crypto mixers; ongoing increases in regulation against privacy and peer-to-peer tech.
• DARPA is launching a pre-crime anti-money laundering pilot.
• Apple removes end-to-end encryption for UK users per government demands.
• Positive notes: Mulvad adds Lightning payments, Breeze secures $5m for Bitcoin Lightning payments, Braiins launches new solo-miner-friendly mining pool, Rumble announces a Bitcoin+tether wallet, Braiins open-sources more mining hardware.
• The ecosystem is rapidly maturing, with new financial and technical primitives soon available to users everywhere.

Notable Quotes & Moments

• Guy Swann:
  • "I am fixing the gender ratio in Bitcoin one baby at a time." (03:31)
  • “The time factor weighs heavily in the cypherpunk favor in the node running wins the game.” (26:18)
  • “If Saylor was to just do a stream where he's like, today I'm gonna be setting up my own node... tens of thousands would follow...” (81:44)
  • “It's time for another campaign of: Bitch, run a node.” (83:00)
• Mechanic:
  • “LND Taproot Assets is an LND thing. The amount of hotfixes and disasters... is shitcoin level, Solana level...” (12:46)
  • “Pools making templates for other pools... it would be like if all the downloads for Ubuntu were just on Microsoft.com.” (55:07)
• Steve:
  • “One day people are going to realize this. There is only one price of bitcoin and that's the UTX Oracle price. Every other price is a third party price.” (60:45)

Timestamps for Key Segments

• Stablecoins and Lightning: 05:21 – 14:29
• Proof of Stake vs. Proof of Work: 15:24 – 27:21
• Mining centralization risks: 27:21 – 34:12
• Mining pool technical details & diversity: 49:41 – 55:46
• UTXOracle and on-chain price oracles: 55:46 – 68:18
• Hacks & Complexity: 69:32 – 78:23
• Call for Cypherpunk leadership: 79:13 – 84:44
• Bitcoin-backed lending news: 89:59 – 95:42
• El Salvador, IMF, geopolitics: 97:24 – 103:08
• Extra news wrap-up: 104:21 – end

Tone & Language

• Engaged and occasionally irreverent, with technical rigor mixed with humor and strong opinions.
• The participants’ candor (and willingness to dispute finer points on-the-fly) gives the episode a lively, classroom-around-the-kitchen-table energy.
• Frequent analogies, memes, and in-jokes (at times poking fun at both Bitcoiners and outsiders) keep things relatable even when the technical depth ramps up.

Conclusion

This roundtable captures a pivotal moment for Bitcoiners:

• The infrastructure built for deep technical and philosophical reasons is now being repurposed and tested for mainstream, complicated, and even adversarial use-cases.
• The Bitcoin space faces simultaneous threats from technical complexity, state and regulatory capture, and end-user complacency.
• Yet, new tools (like UTXOracle and truly decentralized mining pools) and a re-energized culture of cypherpunk activism point toward a resilient, innovative future.

For anyone considering their place in Bitcoin’s unfolding story—or wondering how the ecosystem’s technical and social challenges are evolving—this is essential listening.