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- [00:18]
A
Hello and welcome. This is Gabriel Custodiet of Watchman Privacy Privacy practitioner, consultant, author and frontline fighter in the push for privacy. I know why you're here. Like the rest of us here in the Resistance, you're trying to escape the technocratic apparatuses that you see enveloping you and crushing your freedoms. That's why I created all of this, all without sponsors. I hope you enjoy this show. But then when you're ready to take the next steps to secure your privacy and your future, Visit my website, escapethetechnocracy.com to start the real journey. Your support alone determines the future of the show. See you there. Editorial note here this episode was originally recorded in December of 2023. The audio has been remastered, it is being re released and I think the topics pertaining to bitcoin are as relevant as ever. The bitcoin community is like a ship. A fantastically engineered ship, the first of its kind, headed toward an undiscovered but no doubt fabulous new land. It's been traveling for a while now, always in roughly the same direction, and the further it goes, the more locked in the destination becomes. Now aliens arrive on the planet for the first time. The first thing they see is this ship. They assume, not incorrectly, that anyone on this fantastic ship together headed for what is clearly a great place, must have a lot in common. Then they get closer and there's Samurai, wallet cutlass between his teeth, beating the crap out of some guy. This poor guy, what did he do? Well, perhaps he tried to mutiny. Perhaps what you're witnessing is self defense. No doubt there's some history there. Hard to tell from first appearance. This is one of many fights going on on the ship. Random assailants are trying to stab samurai from behind. The team of Ronin Dojo is fending them off so samurai can do his business. One bloke waving a black flag with a digitized pirate skull picks up his gun without hesitation and is now taking shots to maim everyone who looks suspicious within reach. There's a crazy look in his eye, zooming out. This is one of many skirmishes going on on the ship. The aliens look elsewhere. There are officers on the deck looking at the fighting. In between sips of tea, some sit on the fence railing to get a view of the participants, but don't say anything. They're officers for a reason, and they rarely bother themselves with the fighting downstairs. Suddenly one of them shouts, let's all get along. The voice doesn't carry amid the screams of death and mercy below, but the officer simply Nods, content with his action, turns around and gazes off into the horizon. After thinking it over, the aliens realize that these fights are not minor. They're probably fighting over the trajectory of the journey, if not the destination itself. There's a coral reef on one side of the ship, and any diversion at this stage could wreck the boat entirely. The reef is oddly colored and only visible to those who aren't wearing sunglasses. A few fights have cropped up for this reason alone. Quite a few people below in the hole can barely hear the shouting and certainly can't see any navigation dangers. They're counting and recounting their paper money and only look at the ceiling in frustration when a loud noise distracts them and makes them lose their place. One money counter with a lot to spare stands up and puts some into the donation dish of a ship entertainer. This female journey woman receives a lot of attention just by virtue of being on a predominantly male ship. In between skits, she yells out statements affirmative of their journey. She has a parrot on her shoulder that repeats some of the phrases to everyone's amusement. Squawk. And the Fed. And the Fed. One man laughs in agreement, but then entertains a Did the bird get the words from her, or did she get the words from the bird? He goes back to counting his money. Above deck, the skirmishes continue. Despite various personalities, the ship somehow ambles on day after day. The arrival point has certainly changed from the beginning, and many on the ship think that the destination itself has changed. Some don't disagree, but think that they've learned things along the way that warrant such changes. The bitcoin community is like a ship. Welcome to the Watchmen Privacy podcast. I'm very pleased to be joined by two people, Zelko from Ronin Dojo and the speaking representative for the Samurai Wallet, Zelco. How are you doing today?
- [04:31]
B
Fantastic. Thanks for having me.
- [04:33]
A
I'm excited, of course. And Ronin Dojo is a node that connects with the Samurai Wallet. It's designed to be integrated the two and go to Ronandojo IO and see what they're all about. Great company to support Samurai Wallet. How are you doing today?
- [04:50]
C
Great to be back with you, Gabriel. Doing well.
- [04:53]
A
A few purposes of this episode. The first, of course, is just to hear from Zelco and Samurai Wallet. That's always a pleasure. And to kind of understand some of the underlying bitcoin values that animate both Ronin Dojo and Samurai Wallets. The second purpose is to see some of the big conversations happening in bitcoin and to do so historically. I think a lot of people stumble onto the scene and they see all these people going at it and they're kind of wondering like what's going on. And what they don't realize is that there are conversations that have been happening for many years, in some cases since the beginning of bitcoin. And so uncovering some of this history can I think, give people some perspective. And then the third point is just to show that not all bitcoiners are the same. In fact, I think that a lot of people might see bitcoin as this monolithic ship that's just sailing off into the horizon. But there are different factions within bitcoin and they sometimes do not like each other and they're steering the same ship that they believe in. But if somebody steers you the wrong way, it is as dangerous as let's say, somebody who is working for the Federal Reserve. Like it's that serious. So the first question that I want to ask you both is a question of what are the lines that you do not cross as a, as a bitcoin company?
- [06:10]
C
Yeah, great, great question. And you know, it's something that I've talked about a lot actually over the years and I call them red lines that we cannot cross and will not cross. And primarily the red lines are KYC and custody. You know, if, if we're ever forced to by law to, you know, KYC our users or implement KYC within the wallet or even integrate with a partner that does kyc. It's just something that is, you know, not happening, not going to do it. We'd rather shut down than go down that road. And the second one is custody. We don't want to take custody of anyone's coins. We don't want to build custodial solutions even if it's just for a few seconds of custody, we don't want anything to do with it. So custody and KYC are two major red lines.
- [07:05]
A
What if there was a law against the exact language that would involve whirlpool? Would, would that be a red line or would that be encapsulated in maybe the self custody?
- [07:14]
C
It's, I think it's definitely encapsulated. You know, one of the, at least up to, up to date. What makes a non custodial coin join different than a mixer is custody. It's the kind of the key aspect. And this is recognized by FinCEN, this is recognized by all the regulators. They admit that because it's non custodial, because the software developer doesn't take custody, there's nothing for them that they can, you know, stop. Right? Because in order to make it, quote, unquote, illegal, you'd have to go after each individual as opposed to one software developer. But if, if they adopted language in the future that said it was illegal to develop this software, it would be a red line. But it's nothing that would make us go away. It's something that we would fight, and we would fight it very diligently because that's a constitutional issue. And our lawyers, I think, would be very, very happy to make that argument that it's a First amendment issue.
- [08:13]
A
And I should note here, if you, if you're not familiar with, with Bitcoin or these two gentlemen, please go and watch a different episode. This is not an introductory episode. And Samurai Wallet has in the past, they moved out of the UK because of a law that was, at least at the time, suggesting that self custody, bitcoin might not be allowed. So they've certainly practiced what they preach. And, you know, there are options. Like, you know, instead of shutting down, you can, you could do things like move, move companies or things of this sort. So there are multiple options.
- [08:43]
C
Yes, definitely. And again, just to reiterate, if there, if the federal government in the US or any. Any government anywhere wanted to make, you know, whirlpool illegal, the enforcement of that would come down to the individual people who are whirlpooling, and there's, you know, thousands of them, if not more. It's. It would be a very, very, very difficult thing to enforce. So this is why they focus on targets such as, like bitcoin fog, which are centralized and custodial. They can go after a person or group of people for violating money transmission laws, for violating, you know, things of that nature. Because whether I agree with it or not, it is money transmission because the developer is taking custody of the funds. The same is not true for Samurai or anything that we do. So it's really our red lines of no custody and no KYC have kind of insulated us and protected us in that way where we can say, no, we're not money transmitters because we never take custody of anyone's money or anyone's funds. And again, if they did go down that route, we would absolutely fight it. I think, you know, a lot of people today, in today's world, they. They get an order from the state, whether it be from a court or more than likely a federal agency of some sort that really has no power to create law, but they, they do anyway, and they immediately roll over. But you don't have to you can always fight those things. You can always say, I don't agree with this and we're going to take it to, we're going to take it to court that that spirit has been lost somewhat. But there is, you know, a precedent for that all throughout history when, when a federal agency or the federal government oversteps their, their bounds, you have to take it to court to get it corrected or try to get it corrected in the courts.
- [10:36]
A
What would the red lines be for Ronin Dojo?
- [10:39]
B
I mean so they're very similar. I mean the fact that we, we're the node side, so we're the backend that's trying to allow you to, to not need any third parties. But for us, so there's some other things that kind of come to mind and that's what we support in our stack. And so we've dropped support for certain, certain applications and stuff that people use even though they were popular at the time because of their stance and their stance either on us, that happened recently and then also their stance on whether it's KYC and who they partnership with. And you know, we're not going to support people that, that fund kyc. We're not going to support people that actively don't like what, what we do. And so that's where, what we build and what we're trying to do. Like as long as there's a way to get to the end that gets our users what they, what, what one, we want and two, what our users need, we're going to do that. And we're not going to sit and just support things just because. And so that's whether it's controversial or not. I'm not, I'm not here to support people that support censorship. I'm not here to support people that don't want privacy. And if people don't like that, they can use something else.
- [11:55]
A
I should mention that I'm talking to two people who represent companies who have left a lot on the table, left a lot of money on the table by sticking up to their values and not just any values, but really awesome values. So definitely respect for that. Now for the next question, I'd just kind of like to go back in time and I think this will be useful to set the scene for the conversations. The problems that the bitcoin community has now go. They go back a long ways. This is a broad question, but I think important. So bitcoin was a peer to peer cypherpunk project and that is not necessarily the case these days. If you look at bitcoin as a whole. So I just want to ask you samurai, what happened? What events, what companies, what people? Feel free to name names if you feel like it happened. That bitcoin moved away from being a peer to peer cypherpunk project to what it is today.
- [12:49]
C
Yeah, so I was going to say it's not a one group or one company or one group of users. It's been a long time in the works that kind of evolution from a cypherpunk project to what we see. You mentioned earlier in your intro, the different factions and politics of bitcoin. And it's really been like that from the start. And you can go way early to when Satoshi was still involved. And the reason he, or presumably the reason he left the project was because Gavin Andreessen gave a presentation to the CIA on what bitcoin is and what it's about. And he felt that it was important to educate, you know, these people on the thing that, that they were working on. And Satoshi disagreed and ended up leaving the project. So you know, these factions exist and have existed for a long time. It's true that in the early days, you know, from 2010 to probably around 2013, 2014, the predominant faction was the cypherpunk faction and what bitcoin. And I would consider myself part of that faction. That's why I got involved. You know, bitcoin was seen as a way to as money without outside of the jurisdiction of the state. And it was kind of the realization of a long time dream. Censorship, resistance was key, privacy was key, permissionless nature was key. That obviously was going to become diluted if the project succeeded. Because as more people get into the space, they don't necessarily align with those values and they come to it with different ideas or different values. And I think so the main reason why we see such a decline in that kind of thinking is one, there's not a lot of us, most people, the question of if you have nothing to hide, why do you need privacy if you don't have anything to hide? That's a common fallacy that many, many people entertain and believe even as they have curtains on their windows and as they use envelopes for sending mail, they don't, they don't recognize that disconnect. And I think more of those people joined in because they saw the price rising and they saw this as a speculative asset investment they could make. And you know, they just have different goals, different ideas. It was always going to be the, the outcome of something like this, the hope at least from my view, was that we would have enough time from the cypherpunk privacy first group or faction to develop the tech to make their, their eventual entry irrelevant to the dilution of the project. So we, we hoped that there would be more privacy tech on chain. We hoped for confidential transactions, for example. We hoped for things like this so that even when these people came, the mass adoption came, they wouldn't be able to dilute the project as such. Unfortunately, things didn't really go in that direction. There was a lot of time wasted with scaling, quote, unquote scaling and the need to scale as fast as possible as opposed to privacy. I think that was a mal investment, but that's just the way it works. So, you know, it's hard to just blame one group or one company or one person or anything like that. It's just, it's just indica. It indicates the, the broader culture that we are a part of and we're in. And it's not just bitcoin, it's the Internet in general that has seen this, this dramatic shift. The Internet of 2006, 2007, was much freer and much, you know, more aligned with the cypherpuck ideas and goals than the Internet of 2024. So it's not just bitcoin, it's just society. Broadly.
- [16:44]
A
Bitcoin is a. On the one hand, there's room for different people and factions and people have, you know, versions of their tech. But on the other hand, it is a single thing that has value because it can trace its lineage back all the way back. And so we're defending this, this single thing. And that's why these, you know, these conversations are so important.
- [17:05]
C
Well, I was just going to say, like, to me, and I think to a lot of people from that cipher pump, privacy faction, the only reason that bitcoin has any value at all is because of its promises of censorship, resistance, its promises of being money outside of the state, its promises of being able to transact freely, you know, to us, I guess to me, speaking for myself, that's the whole value proposition. If, if Bitcoin is just another payment system that can be censored, that, you know, that can be captured, then you may as well just use PayPal from. And this is just my point of view, and I think it's the right point of view, by the way, obviously. So, you know, when you have these people who prioritize mass adoption over prioritizing privacy, for example, I think they're missing the forest for the trees. It's the only reason why bitcoin is as valuable as it is, the only reason why is because of its properties of censorship resistance. And the more you chip away at that, the less valuable and the less interesting it becomes.
- [18:10]
B
I mean it's going to go into the mass adoption. But I think that the, I've been saying a long time that I think that the whole push of how people got onboarded, right, how you were introduced to bitcoin is key, right? If you were introduced to bitcoin by saying like, oh wow, hey, it's a great investment, you're going to make a lot of money. If you just buy and hold or stack sats or dca, you it changes completely like what you were actually here for. And yeah, there's a lot of people that start that way and then they kind of grow into it and they just, you know, they were maybe they were lucky enough to, to get through and at the right time that they ended up having time to learn into the real value proposition. Which is as Samurai was saying, which is that censorship resistance, which is that, that ability to operate without permission and cut out the central, cut out central banks, cut out third parties. That to me is supposed to be what this is about. As a person that's guilty of joining because you were told, hey, this is going to be a great investment, it's going to be worth something one day, sure. But once you open your eyes, you realize that that's nothing that doesn't matter. That started to change. And as a person, I came in in 2016 and that was all the talk. I mean that was just post the block wars. But even the block wars of it was about that part of it was about spending versus you know, keeping smaller blocks for, for the value proposition of, of number go up. So I think that as and as the price pumped, it didn't help anything to be honest. So yeah, I think how people were onboarded, the influencers through that time had a, a large impact on that. But the mass adoption I, I know we'll talk about is, is another big one.
- [19:58]
A
And so Samurai, would you give any at all pats on the back to people who are trying to focus on mass adoption? Because I mean we could say that the reason we can use bitcoin in all over the world, the reason why it has its value, is at least because of the people who have been promoting it. Or is that a fallacious way to think about it?
- [20:20]
C
Yeah, I don't think that's true. I think that in 2012 and 2013, I was using bitcoin all over the world. I was spending, I was onboarding merchants and merchants that I, that I was going to and using anyway. So no, I don't think it's to do with mass adoption. I don't think we've seen mass adoption yet. We've seen it, we've seen an adoption wave certainly. But I would say that there's less places to spend bitcoin or fewer places to spend bitcoin today than there was in 2013. I agree, by the way, with what Selco just stated about how, how it is you're onboarded into bitcoin. The primary focus in the early days was about getting merchants and about getting, you know, people to accept bitcoin and you to spend bitcoin at those places. Whereas today it's more about get bitcoin and as an investment, don't spend it, just, just save it. And as such, we've seen a lowering of places that are willing to accept it because no one's spending it. So no, I don't think that. And I think that we often say, you know, one of our, one of our slogans, you can say at Samurai is that mass adoption is the poison pill and it's, you know, you should be careful what you wish for because when we, when we do actually see real mass adoption, it's not going to be pretty. We don't, we're not in the, we don't have the tech in place to combat the regulatory response to bitcoin being mass, mass used in a mass way. So for example, if we do see CBDCs come, come, come around, which it looks like we are going to see, and bitcoin is, is there as a means of sidestepping these CBDCs, you're going to have a real response from regulatory agencies against bitcoin self custody, against bitcoin outside of the K KYC AML regime. And you know, we don't, we still have a fully transparent blockchain. We don't have confidential transactions. We don't have the tech in place to handle this outside of the application layer, which is where Samurai lies. Like we, we, we're doing everything we can, right? We have coinjoin, we have all sorts of privacy tech. But ultimately to really handle mass adoption, to really handle the effects of a hostile government, which we haven't seen yet, they're starting to go that way. But we haven't really seen the full force of the state come down on bitcoin. Not yet. We're not. We don't have the, you know, the artillery in place, so to speak.
- [22:53]
A
Zelco, if you could, if you could snap your fingers and we no longer have Coinbase and maybe Michael Saylor is no longer with us and all that entire industry of promoting maybe a non cypherpunk vision of bitcoin. Do you think that would be better for bitcoin?
- [23:11]
B
Yeah, I mean I think that if it was being promoted, I think a great example is probably Antonopoulos back in early days of how he was going around doing talks and stuff like that. If that was how we were educating people and how people were learning about bitcoin and not this like on rails and payment rails and stuff like this. Yeah, no, absolutely. I think that I talked to somebody about this at an event and because they asked me at the end of the event if I was bullish about the next price run or something and I basically blackpilled them on the idea and I just said like, it doesn't matter because to be honest, bitcoin could end up being something like Tor where TOR is not used by everybody. It's a great tool for people that need to use it. It's a tool. It's exactly that. But that's powerful. It's a powerful tool. We don't want it to go away. Right. So that's something that. And I told him, I was like, just because it's good right now and everything is fine and sure, the price could pump, but ultimately what is bitcoin supposed to be about? What is the actual value propositions? And that's when I talk to him about censorship, resistance. And the more that the government start to push in and lean and do all these things, if it got made to be illegal or right, and you could only use it in the black and the gray markets, that'd be great for bitcoin. That would bring back bitcoin back to what it was supposed to be, censorship resistant, peer to peer digital cash. And so yeah, if I was snap my fingers, would we be as high of a price? Probably not. I don't know. Maybe. But it's irrelevant, right? Because people who would be using it are people that need it and people that are using it the right way.
- [24:55]
A
People. Yeah. That's interesting. I always, I came into bitcoin as a, you know, as Satoshi says, a peer to peer money technology. And that's kind of how I see it. And regardless of the price, that is how I wanted to be using Bitcoin. So as I was looking at my next questions, this all might actually at the end of the day, break down into mass adoption versus correct usage in a cypherpunk manner. But let me pivot to one topic that maybe won't bring us into that discussion. Another bit of politics in Bitcoin is software that isn't actually open source.
- [25:28]
C
Yeah, great question. And that's actually something I miss from our red lines. One of our red lines is being open source. True open source. Yeah, it's definitely something that has been degraded over time. Again, there was a time back in 2012, 2013, even up to 2015 probably, where if, if you were providing a wallet or some kind of interface to Bitcoin and you were an open source, you were laughed out of the room. No one would use your stuff. It was inconceivable, really, that a wallet would be closed source. And we've seen that kind of degrade today. So, I mean, the best example I can think of, the most recent example, would be Coin Kite. They produce hardware wallets for Bitcoin in the form of. What are they called? ColdCard. A little bit of history. The first hardware wallet was Trezor. I'm sure your users have heard of Trezor or your listeners have heard of Trezor. And what Trezor did was they created all open source code to work with their hardware wallet. And they licensed that code as an open source license called the gpl. And the GPL essentially says, you can do whatever you want with this code. You can change it, you can monetize it, you can copy it, you can copy it and make changes, or you can copy it and compete with us. You can do anything. There's no restriction. The only thing that you can't do is take what you've done and make it closed source. So we've extended this license to you to do whatever you want. You by extension, by using this code, have to give that option to everyone else as well. And you can see what, what Trezor, by making that decision to go completely open source, true open source, using the GPL license, what has blossomed out of the industry where we have tons of different hardware wallets now, and largely most of them using some iteration of Trezor's original code. And one of the examples is ColdCard. So when ColdCard was created, they used a huge amount of Trezor's code to create their product. They made changes, they made improvements, and they licensed it because they had to, under the gpl, meaning anyone else from then on could do the same thing. And we saw that exact thing happen. Where after the Cold card was released under the GPL using the bulk of Trezor's code, they then had a competitor join on the scene in the form of foundation to improve the hardware wallet. Or, you know, they, they think it improves it, and it probably does. And they took that code, licensed it in the same exact way, gpl, and have brought to market another hardware wallet. So now consumers have a choice. They had Trezor, they have Cold Card, they have foundation, each with their own strengths. And it's a beautiful thing. That's the power of open source. Unfortunately, Coin Kite, the developers of the Cold card, were very unhappy that a competitor used their code, even though they had done the same thing. They were very unhappy, had a competitor use their code to create a hardware wallet and compete with them in the market. And as a result, they changed their license and said, we're no longer open source. We're now. They use the term source viewable. Except they didn't actually say that. They continue to say we're open source. And that's where the point of contention comes into place. Right? You, you have a company that says, here's our source code. You can look at it, but you can't do anything with it. You can't make a competing software or competing hardware with it. You can't do anything. But look, and that's not what open source means. Open source is free software and it means free to do whatever you want with the software. And that might mean, yes, competing with you. And that's a good thing because it brings more options to consumers. So the issue with Coin Kite is they're marketing themselves as open source because open source is a popular thing and people want to see open source software, but they don't actually, they're not actually open source because they put a lot of conditions on what you can do with the source with the source code. You know, it devalues for everyone who is building true open source software, it devalues the meaning of open source and it's misleading to consumers. But, you know, Samurai Wallet, all of our stuff is open source too. And we, you know, every, every component of, of the system. The Samurai stack is open source, from the Wallet to the Coinjoin to the server side component of the Coinjoin. And that means, we understand what that means. That means not only that users can look at the code, audit the code, review the code, but it means that someone at some point can come along and take the code and compete with us. That's a good thing. You know, that's something that's a positive thing for consumers at the end of the day. And it's, you know, it's happened. We've had people fork our wallet and go to compete, and they haven't succeeded in terms of taking over or taking our users. Because running a software company or a business of any kind is a lot more than just the source code. You know, it takes a lot to gain the trust of users to operate efficiently, to develop all this source code and maintain it. So it just being out there is not a threat to people, to builders, I should say. It's a strength. One of the things I respect about Ronin and Zelco is they follow that all of the stuff that they've put out has also been open source. They understand the power of open source. And yes, there's risks to people coming in and swooping in and taking your source code and competing, but really, it's such a, like a small risk compared to the benefits of opening up your systems and people coming in to, you know, build on top of. And in fact, I'm sure Zelka will go into this. But it's how Ronin came about. You know, we created Dojo. We open sourced dojo and put it out there. And then our attention focused onto other things like coinjoin and this and that, and we're not as focused on Dojo. And the Ronin team goes, we can make Dojo even better and we can be 100% focused on it. So they took what we did and improved it, made it better, built beautiful interfaces around it, put it into beautiful hardware. All of that stuff we probably would have never got around to doing ourselves, because we're just, you know, we have other things, other focuses that we're working on. So by open sourcing and making it open source without restriction of any kind of, you know, the whole industry can flourish. And that's why it's such an important aspect of bitcoin. My last point would be, what if Satoshi had licensed Bitcoin in the same way that Coincai has licensed their stuff now? Meaning you could look at it, but you can't do anything with it. You know, we would not have anywhere near the level of innovation and the level of products and services that have been built on bitcoin that we do today, had he made that licensing decision, but he chose a very, very permissive license in the MIT true Open source license, where you can do anything, and it's even less restrictive than the GPL license that I was talking about, whereas you can do anything and you don't even have to license it as open source, you know. And so open source, I think, is a fundamental, has to be a fundamental red line for anyone who's working in Bitcoin. And I think it's shameful to not that and to. To close. To close your source code down, especially when you've benefited so greatly from the open source ecosystem, as Coincite did.
- [33:29]
A
That was well said. I know, Zelco, you're going to have a lot to add to that. So I know that Ronan Dojo feels strongly about this. Now, free and open source software, free as in freedom, not free as in no cost, is a kind of a complex thing. Some people get into it, they don't quite understand. They know that they want to be able to see the developers doing their work so that they're not hiding anything. Right. So I trust as much of my privacy and security software to open source, that is, I can view it. I try to rely on that as much as I can. I simply wouldn't be comfortable trusting somebody who's not showing the work. But there's the whole other aspect to it, which Samurai, while it was discussing where this is a, it's a, it's a package, it's not just that you can see the source code, it's that you can take it and you can use it for what you want to use it for. And that is better for everybody.
- [34:19]
B
I mean, absolutely. That's how innovation is made, right? Being able to take, I guess, a good example would be like the Tor package that's in Samurai Wallet, actually, and that being a mobile package that can be put into Android apps, and that being if that's not open source and people can't build it, or if Tor wasn't open source and people couldn't be able to build that other stuff, we wouldn't be able to get to where we're at today. With so many wallets now, and Samurai being the first. Right. But so many wallets now being able to have Tor Tor built into their app. It's what. I think what gets me the most upset about this concept and going back to the cold card is this. They want to play both sides, so they pander both sides where they're, oh, well, the source code's all right here. And be like, you can view everything right here, here it is. And then be like, see, it's open source. And it's such a slap in the face to everyone that is actually building open source code. And another part of that story, and Samra can correct me if I'm wrong. But when Coldcard did take a lot of that code from Trezor, they also changed the package names to their own package name so that it didn't. Which is kind of a shady move if you are literally copying and pasting that source code that was someone else's, and then you change the names to try to make it seem as if you wrote it, which, you know, that that was kind of like a big. A big issue in the beginning. But the fact is that this whole thing is supposed to be as an open source, is that you're standing on the shoulders of giants, right, For Ronan Dojo. Yeah, like, we do stand on the. On the shoulders of giants. You know, the team that I know, Laurent, was a heavy player in developing the Dojo architecture. And I was talking to him recently, I was like, it's just amazing for me, even after all these years, just how well he built it, that it doesn't take all that much for us to change things and we can still tweak and do other things. But, you know, we stand on samurai shoulders, on Dojo's shoulders. And, you know, for us to go back and try to change it and say, oh, well, we. We could take their stuff, but no one else gets to do that. One, I find it disrespectful. Two, I find it completely wrong in the space that people put on their. On their websites for people to see as they're going and looking at their stuff, they're like, oh, here. Here's our open source code. And they make it seem as if open source is the same as. As false. And it's an intentional marketing play to pander to both sides. And then they go on a whole campaign to try to say that it's basically the same thing, that you can audit it, that you can do this stuff. And that is not what this is about. And what it really comes down to is that these people who do that are scared. They're scared of competition. They don't realize all of the benefits that come from it, and they're scared that someone can just take their stuff and make it better. And they were just too lazy to make their product better and in a competitive way. That that's the real reality to it. And yeah, so as people, as we go forward, I hope that more companies get back to that, get back to the open source and that we can build off of each other, because that's what this is. That's how we get better. I might not like everything if someone were to Clone Ronin Dojo today and do something else, which I. We actually had someone recently that, you know, they, they took our stuff and modified it for x86 and they're push, pushing that out and I think that's great because similar to Samurai, it's on our roadmap but, you know, it's not something we've had the ability to get to it right now. So the fact that someone's already done it, that's cool. And it's open source, so I can go back and grab that and then we can put that in our stuff. It's. It's supposed to be a give and take and. But at the end of the day, if they were to rebrand it, it's not going to be Ronin Dojo. They're not going to have the same vision that I do, they're not going to have the same roadmap that I would. And so it's going to be a different product and it's going to be different. And like Samurai said, they're not going to know. That's not going to be as easy as everyone thinks. Just copying and pasting code doesn't make, it doesn't mean that you can run a software company. It doesn't mean that you can maintain all that code, that you actually know what's going on. Yeah, I think that that whole push and it happened a lot in the, on the node side, there was multiple node implementations that just decided to, to go the opposite way and to close their code for whatever reason and which is silly, really excited to, to be one of the teams that maintained the open source. And it was never a doubt in our mind that we would do anything other than that. And everything that we do, we try to make sure that we open it back up. Even if we're developing something or whatever it is, we make sure that we find a way to get that information out to people because information wants to be free. The gaslighting behind that is infuriating. And hopefully anybody that looks at that, if you see someone that's spouting that they're open source, go look at their code, just go look at the license and make sure that they're not just talking out of their ass.
- [39:34]
A
Are there any other companies maybe historically or otherwise, who we could point out as being guilty of this? And I don't say that to be, to have these gotcha things, but it is the case that people might listen to what we're saying, say, oh yeah, that sounds good, and not realize that they're still Using or supporting a company that doesn't actually have true Foss.
- [39:53]
B
Yeah, Umbrel is one. I don't know if my node opened it back up. I know Start 9 just recently opened up their. Made their source code or at least part of it. FOSS and Umbrella probably being one of the most popular ones for new people running a node, um, that is still closed. Closed source.
- [40:12]
A
So there's a. There's a good episode of the. The people from various Node companies discussing and arguing with one another. Zelco was there representing Ronin Dojo. I'll try to link that in the description. That was on a Citadel Dispatch.
- [40:26]
B
Yeah, Umbrella was not present. They were too cool to show up.
- [40:30]
A
That would. That was a. That was a very informative episode. So. But these two gentlemen I'm talking to right now, they don't have. They don't live in a glass house. And so they. By all means they can throw as many stones as they want. Maybe we can move on to a political topic here. I'll get this one started. So one of the other pieces of the political agenda about bitcoin is that people will say that bitcoin is apolitical. Or they'll even go so far as to say that bitcoin is for progressives. Now this, this kind of irks me. I understand what people are saying in that bitcoin, like it doesn't matter what your politics are. You benefit from the FOSS nature of bitcoin and all of the monetary properties it has and the fact that its node system is spread out, making it uncensorable and all these other good things. On the other hand, I think it's pretty disingenuous to look at a project that is absolutely libertarian, you might say anarchist, certainly super limited government and has nothing to do with the progressives who have ruined sound money and who stand for everything against bitcoin.
- [41:34]
C
Yeah, I think it's complete nonsense. Bitcoin is, is very political. At least that's how it started anyway. In the, in the. In the Genesis block, Satoshi inscribed a headline Chancellor on the brink of second bailout for the banks. Politics is integral to Bitcoin. It's not apolitical at all. One of the early presentations that I watched it was 2013 or 2014 by Michael Goldstein. Is highly recommended if you could find it. Or I'll send it to you and you can put it in the show notes. I think it should be required viewing for anyone interested in bitcoin. It was called, I believe, Bitcoin An Experiment in Anarchism and it goes in depth into the. Well, we were talking about building on the shoulders of giants that goes into all the giants that bitcoin was built on by Satoshi. It absolutely is not apolitical. And I believe it is coming. It was designed and, and built from a anarchist perspective. And of course, I mean anarchism as in anarchy without rulers, not, you know, throwing Molotov cocktails and anarchy versus chaos.
- [42:49]
A
Two different things.
- [42:50]
C
Two. Yes, two different things. The Latin meaning of anarchy, anarchos is without rulers. And I believe that's what bitcoin was built to, to usher in anarchist money. And that's why I, you know, before bitcoin, I was involved in that kind of sphere. I still believe ideologically those things. I still am. I would call myself a, you know, an anarchist in that way. So, no, it's not apolitical at all. It's very political. It's a big statement. And that's, I think, what the, the, you know, the tension is between those, Those factions that we were talking about earlier, where you have the, the anarchist faction or the without rulers faction, and the factions that want to integrate and become part of the system. So I would. I would highly recommend your listeners to listen to Michael Goldstein's 2014 talk.
- [43:48]
A
The progressives were, in the late 19th century, the people who looked at the world and said, hey, we need to improve things, we need to change things, we need to tweak things. They're the ones behind central banking. They're the ones behind large government. They're the ones who believe that money should be a creation of the state and not as any inherently sound thing. I don't want progressives at all around me or involved in bitcoin. Please, please stay away. That's my opinion.
- [44:13]
C
We talk about, you know, in bitcoin being against fiat and this and that and. And even the progressives will say, say that. And it's funny because going back again to what words actually mean, fiat is not talking about fiat money. It. Fiat means by dictate. Right? And the progressives would quite be quite happy to dictate and have historically been happy to dictate policy and dictate how you should live and dictate how you should be by. You know, I just think, I find it ironic and funny that they will rail against fiat thinking it's just talking about money when no, fiat money means money by dictate. That's the whole point of bitcoin is to, you know, get around these dictates, get around fiat in general. Not just fiat money.
- [45:05]
A
Completely agree. And the progressives should stick with their fiat money and sync along with it. I definitely support that.
- [45:11]
B
I completely agree with all of that. I mean, you can see, to go along with the dictate, you can see how that is where people try to tell you how you need to spend your money or how you need to operate in this system, which I think there's a huge difference between a recommendation or what is best practice, so to speak. And then there's. There's people telling you, oh, you, you can't do that. You should never do that. You shouldn't be allowed. We shouldn't be allowing you to do that. We need to find a way to make it so that this is not an authorized transaction. You need to understand what you're actually getting into and not just, you know, trying to dictate to other people how they need to. How they need to operate. Yeah, no, I completely agree with everything that you guys have been saying.
- [45:57]
A
There is another divide in Bitcoin about whether bitcoin should be saved or spent. And there are a lot of people who do not use their bitcoin, do not think you should be using bitcoin because they are waiting, I suppose, for the day when it is a lot more valuable than it is now. And they might even have a theory of money where they say that, look, something has to have kind of max value before you really use it as spending. And we're going to simply wait for that day to arrive. What do you think about the savings versus spending argument? What are people getting wrong? Zelco?
- [46:31]
B
It's not for me to tell people what to do with their money, but I think if you're getting into this just to save for future time, that's the most boring thing that you could do, bitcoin. And it's funny because recently Sam was talking about satoshi dice back in the day and how used to be able to gamble with bitcoin and do different things. I think it's a totally different. When you spend your first, like you spend something with bitcoin for the first time, for all those people who, you know, they have their money, they have their bitcoin saved on a, on a hardware wallet somewhere and they've never touched it and they're just waiting and waiting for the day, the day that you do it and you actually do a transaction and you actually buy something with it. It's a changing moment. I know I'll never forget buying something with it for the first time, especially like a larger purchase and now it's not even really a thought, but it's. If you're getting into it just for that, just to save it, you're missing it and you're missing out on a huge aspect with a real aspect of bitcoin, in my opinion. So I would definitely encourage people to go out and buy something, do something. And I think that's one of the cool things that is actually built directly into Samurai Wallet which without people really needing to think that they're necessarily spending something because they're paying for a service. But like you know, even, even that so many times people want to complain about how much a fee costs for a service and you're like, dude, you don't spend your money, you don't spend your bitcoin anyways. So like what are we, what are we doing? And then you have people that, the same crowd that tells you to never, never spend your bitcoin and you know, hold forever. They're the same ones that want to push a payment network that's like dead, you know, that's, that's broken. So I thought, I always thought that part was kind of funny. So yeah, people just, I encourage people go, go do something with bitcoin, go spend it, go just make a transaction. Especially one that you, maybe you didn't think that you should. It's, it's a, it'll, it'll open your eyes for sure. That would be my recommendation on that.
- [48:38]
A
And personally I don't see any value in bitcoin besides being able to send it to somebody else and use it as a money now samurai. I know you don't really use hardware wallets. You think that, that your bitcoin should be available to spend at any time. You live off of bitcoin, but shouldn't you be saving that?
- [48:55]
C
Absolutely, yeah. You should spend and save. You know, as someone who has been living off of bitcoin since late 2012 and someone who is running a business completely using bitcoin. No, no fiat of any kind of. Since 2015, I both spend and save.
- [49:14]
A
You have to let us though make sure that we cover a timely topic which is the drama of ocean mining.
- [49:21]
C
It came to our attention on 6 December that ocean mining, which was, it's a new mining pool that launched towards the end of November of 2023, had made some software changes and as of 6th December, several of our privacy focused transactions would be filtered by them and not included in the blocks that they mine. This is what, what came to our attention on the six I reached out to one of their main investors, which is Jack Dorsey, who all your listeners, I'm sure, are familiar with. I reached out to him kind of as a, in a Hail Mary kind of pass, because we've never communicated before. And I asked him to confirm this was happening and if it was happening, to use whatever influence he has at Ocean to, to change course. And if I didn't hear back from him in a timely manner, I would have to make a public statement about these things. So I didn't hear back from him for, for some time. And on the 7th, I made a post on Twitter essentially alerting the community to the fact that these transactions, which are of course standard and valid transactions, would be filtered by Ocean and not included in the blocks that they produce. And then I, you know, I continued to explain their welcome. And this is the way Bitcoin is designed to do whatever they want with the blocks that they create. But that said, I hope that users and miners who are pointing hash power at this pool choose not to support it there. This pool, because it's a endorsement of filtering and censorship. And the tweet blew up, it got a lot of attention and you know, it reiterated that the majority of Bitcoin users on the surface just don't agree with censorship. And I thought that was a positive thing. Now, what it really means realistically is not much because Ocean has very little hash rate. They're unlikely to create blocks anyway just based on the amount of hash rate they have. But that's kind of besides the point. They're very well funded, over $6 million in funding big headline investors like Jack Dorsey. It's a, it's a dangerous, slippery slope to go down for a mining pool to enforce their, their own vision on what blocks should it contain, is essentially laying out the blueprint for hostile state regulators and activists to bring this in. Right. And it's kind of like, it's kind of like the debate around Internet publishers. Where are you a publisher or are you an expert editor? Right. If you're an editor, you're choosing what content goes in and you can be held liable for the content that you publish. Whereas if you're just a publisher, anything can be published and you're not liable for what is published because you're just putting it out there. It's a First Amendment thing again.
- [52:33]
A
Or maybe something like net neutrality, Right?
- [52:36]
C
Yeah, exactly, exactly. And there's another regulatory framework in the US that I forget which one it is, but it's essentially. Is Google, for example, liable for their search Results, you know, if you, if you can find, you know, the recipe to build a bomb on Google, should Google be held liable for that? And of course, no, they shouldn't be held liable for that. But then if Google starts, and they have started this, and again, it's slippery slope, they shouldn't. If they start heavily censoring what is out there on their, and can be found on their search engine, they're editorializing their search, then maybe they are liable if something gets through because they have these policies where things are not supposed to get through. Does that kind of make sense?
- [53:24]
A
It does, yeah. And just to give a little bit more context, so in the last year we have ordinals on in Bitcoin, which has clogged. And so Ocean Mining sets out to start censoring those kinds of things in a broad way in order to solve the problem as they see it. But the transactions of the Samurai Wallet get caught up in that Net. Now, maybe you could just explain Samurai why. What is it about the transactions within Samurai Wallet that they were caught by this limit that Ocean Mining set?
- [53:58]
C
Sure, yeah. So the limit we're talking about is the OP return limit in Bitcoin. This is not consensus stuff. This means that every node operator can set their own limit and every mining pool can set their own limit. But the default limit that 99% of nodes are running is 80 bytes. And the limit that Ocean chose is 42 bytes. Now, in a samurai whirlpool, tx0, so not the coin join itself, but the tx0, you can think of it as the setup transaction, the, the transaction that is made to set things up for a good COIN join. In that transaction, we use 46 bytes of op return. So that's if Ocean was looking. Anything above 42 gets filtered. We're at 46, so we get filtered. The main issue with this, this filtering though, is that it's not doing what they think it's doing. Because the majority of ordinal stuff, jpegs on the blockchain, as people like to say, or BRC20 outputs, is they're not using offerturn at all. They're using taproot outputs or multisig outputs, and that won't be caught by this filter. And the second aspect of this is those UTXOs are remaining unspent, so that's increasing the UTXO count and you can't prune them. So on your home node that you're running, you can prune OPERA terms. So you can prune that without any issue, without any negative side effects to the network. But you can't do that when they're using taproot outputs, for example, you know. So actually the use of op return is the best, best option for the ordinal people and it's the best option for what Samurai is doing. And the reason we're using the opreturn output is to tell the coordinator to prove to the coordinator that the anti spam fee has been paid and without having to run a centralized database comparing all inputs, making sure they've been paid, etc. And this is going to be extremely important as we continue our efforts to decentralize the coordination of Whirlpool Coin joins which we are currently and have been working on for the last year and a half or so. And the this is nothing new. As I lay it out in the thread, this is nothing new from Luke Jr. Who is the CTO of Ocean Mining. He has been caught several times in the past implementing blacklists, implementing censorship of transactions that he disagrees with or he believes are sinful. And I'm not, you know, being fallacious or anything. This is, he believes that certain types of transactions are sinful and he's quite happy to exclude them from blocks. This goes back all the way, you know, to 2011 or 2012 when he, he secretly updated the Bitcoin package on Gentoo Linux to include his blacklists as part of the default package. And of course when that was found out, there was huge amounts of uproar within the community because that was a very early, early days of the community and censorship was just absolutely not up for debate whatsoever. And you know, he got egg on his face during that event. And of course the passage of time, people don't know that or don't remember it or have no concept of it, but this is just par for the course with, with Luke. This is how he is, this is what he believes. And of course, as I already said, he can run his company the way he wants to run it. He can choose to not include blocks that he does not include transactions into blocks that he doesn't agree with. But it's not the right way to go about things. And we're seeing that pool has lost hash, power miners are pointing their hash away from Ocean, putting it into other towards other pools. And this is exactly the way that Bitcoin was designed to run. You know, when you have a pool that becomes hostile and wants to censorship, wants to censor transactions, whether that be OFAC compliant blocks or no ordinals or none of. None of what no Whirlpool miners will point their hash power away because the economics of it are you're believing money on the table and miners are about one thing that's making money. It's not an ideological thing. It is how can I make the most amount of money doing this thing? And the way you make the most amount of money doing this thing is including all the valid transactions that you can, because all of those transactions are paying minor fees. You know, none of, none of our transactions go above the current default size and what has been the default size since 2012 of 80 bytes. Like I said, Whirlpool uses 46 bytes and Bit 47 Paynims use the full 80 bytes. And they, you know, they need to be used. If, if for whatever reason the majority of miners decided to not respect those defaults and not relay transactions above, you know, 42, like Luke, well, then we will make relationships with miners to provide them with our transactions directly and bypass the mempool entirely. We've already had miners come to us and say, look, if this becomes a problem for you, we will happily mine your transactions, you know, out of band. And this is not something that we want to see happen. We like the mempool, we like the way that it's designed. And, you know, I think that, I think that honestly, there's no risk to this catching on, because it catching on would mean that these miners are saying, we don't want your fees. And there's not many miners who think that way.
- [59:55]
A
And so it should go without saying, I'll give Zelco a chance to speak here, that the three of us are pretty aligned in how we think. Obviously there's another side of the story, etc. But it's my show, so I get to choose which viewpoint I put on. Zelco, you said that the ordeal with ocean mining reminded you of the blockchain wars. Why is this such a. On the one hand, people looking from the outside might say, oh, this is small, but why is this such a big deal? Why should we care so much about Ocean mining situation?
- [60:24]
B
I mean, in particular with the censorship. Because I mean, you see so many people that want Pro ordinals or ERC 20, BRC 20, whatever it is. And then you have the other side that doesn't believe in. Like you have one side that wants to do all those and then you have the other side that wants to censor those or not, whether you want to call it censor. They just don't want to see them on the blockchain. That's a Totally different thing. So I mean that like it adds into each other for the fact that like we're talking about censorship and we'll pull transactions pay nims. They got wrapped into this and seeing it brought to light by Sam Rawal and the thread heard around Twitter, I guess around the world, it opened up a lot of people's eyes, I think to the reality of the censorship just to make people under really understand. Because a lot of people it started by saying like oh, Whirlpool transactions, all Whirlpool transactions are being censored. And I don't think they understood the reality that based on the counter arguments that Whirlpool in and of itself that actual transaction wasn't what was being censored, it was the TX0 transaction 0 which is a preparations transaction to enter Whirlpool that was what was being censored. And just to clarify so people really understand is that that transaction is critical is a requirement for a Whirlpool transaction to happen. Right? You have to have a premixed transaction. They have to have at least two premixers in order to execute a whirlpool. So say if this had caught on and say that this did get bigger, which I agree with Samurai, I don't think it will. But if that was the case, you would see Whirlpool transactions slow down because of that, right? Obviously Samurai has already talked about the counterpoints to not allow that to happen. But the point is that by censoring that tx0 it effectively is censoring the Whirlpool transactions in of itself. And so a lot of people didn't understand that point is that pre transaction, the Setup transaction of tx0, which is critical in order to set up for equal outputs, paying the minor fees and paying for the Whirlpool transaction that has to happen. And it's critical to have in a zero link protocol COIN join which Samurai is the only one to have. It's critical. And so it's the fact that if they didn't care enough to do this and my counterargument was just that if all these people think that Luke JR is the greatest developer ever and helped with Segwit and make all that stuff happen, you know, he, that's cool. But if he's that smart, then he knew exactly what he was doing. That's my counter argument is that he knew exactly what he was doing. And he's been a Samurai hater, whatever you want to call him. He's been anti Samurai for a very long time. Since Paynim was a BIP since BIP 47 was introduced and called it Spam. From the beginning, when I said it's like the block wars again, it just felt very divided but very passionate on both sides. And to an extent, I think that passion both sides, to be honest, passion is what bitcoin had been lacking for a while. Like, true dedicated passion of, like, this is a line that will not cross. And seeing people pick a side is kind of what it reminded me of because I. I joined bitcoin during the block wars, so I got to see all these people like, attacking each other. Like, despite. Despite people having points on both sides, like actually attacking, but attacking of people's ideas. I think it was still a little different. But this recent movement was, was Excellency. It actually gave me life because I got to see how many people, even people that I never thought that would actually come out and defend Samurai or defend their point. But seeing people stand up for the right thing and seeing people stand up against censorship and for privacy like, it was, it's exciting and it was rejuvenating, to say the least.
- [64:36]
A
I like having you both on because you can speak to some of the history that when something happens, it's not just, oh, this is an isolated event. You can trace this back a long time ago. And on that topic, it wouldn't be a episode with Zelco and Samurai Wallet. Without criticizing Lightning and Samurai, maybe you could help us give. Get some of that historical perspective. Lightning Network has been the solution, or has been pitched as the solution to a lot of bitcoin's problems. Who have been the main players or what has been the main mindset pushing the Lightning Network? And why is it not the solution that we think it is?
- [65:16]
C
Yeah, sure. So Lightning Network, you can trace it back to 2015 maybe a little bit before with the research papers and such, but it was a result of the block wars, block size wars. And it was essentially the answer, the easy answer that proponents of keeping blocks small, quote, unquote, had when confronted with the question of, well, how do you scale bitcoin? It was convenient for the small blockers who chose to engage in that argumentation to say, well, we scale it off chain in something we call Lightning Network. Now, during the block size wars, we, Samurai was around. We had a software product, we had the wallet out, and we came out on the side of smaller blocks. However, we did not engage in the argumentation of, well, how do you scale bitcoin in that case, because we saw it as a deflection. The answer is yes, Bitcoin blockchain does need to be able to scale. However, it doesn't need to scale right now because it's nowhere near the usage required to go down that path. Lightning Network was used as. You know this answer where? Well, we scale using the Lightning Network. That's how we scale. And as it's been proven, that's not the answer, at least not in, in the market because a market has, has rejected the Lightning Network. Even with high fees that we're seeing now as a result of the ordinal stuff, Lightning Network still isn't being used. And our argument towards the Lightning Network back then and still to this day is it's not, it's, it's designed on high top down as opposed to organically bottom up. And what will end up happening in the current design of Lighting Network, and this is what we said back then, is that you will end up with custodial solutions because that's the easiest way to interact with lightning. It'll be custodial solutions, middlemen and roadblocks on the on ramps. And that prediction has turned out to be largely true. The only usage of lightning that we're seeing today, and yes there's a few people here and there that are using it non custodially or whatever, but a very few and far between the majority of usage that we're seeing is via custodial solutions. It's, it's kind of what we call banker tech, middleman tech. Anyone who is of that kind of mindset is very pro lightning because they can easily see a way to monetize, easily see a way to rent seek using that network. So it's not the, it is not the scaling solution I don't think. And I think it's taken a lot of investment and time away from actually determining and figuring out what will be the scaling solution. But it's certainly not going to be lightning, at least I don't think so. And everything that we've predicted about lightning in terms of it being custodial in nature first and foremost has turned out to be true. And that's what we've seen. So you know, Lightning Network is theoretically cool on paper, but in practice is in very much not ready for prime time. Hasn't been ready for prime time. And we see it in the marketplace, you look at bit refill or coin cards or any of these, these online merchants that do large amounts of volume either in bitcoin or altcoins, you look at their sales. And Lightning Network isn't Even as popular for, for making these transactions as something like Litecoin is. Litecoin beats it. Obviously, Bitcoin is number one. Most people are using Bitcoin for these websites. But number two and number three are like Monero and Litecoin. So, you know, and, and then with the ordinal spam like I said, or not spam, but ordinal transactions like I said, you would expect to see, with minor fees so high these days, you know, on any given day, you're looking at 100 satoshis per byte, at least. You would expect to see flocking towards the Lightning network. But we're not seeing that. You know, it's just not what people want to use. And there's a big difference between creating code and creating a product that people want to use. And that's what they've done. They've created code, but no one wants to actually use it. And the people that do want to use it, and they go, you know, they go to try to use it, realize that it's near impossible to use privately, it's near impossible to use sovereignly, so they end up using it using a custodial solution. And at that point, what's the difference between that and PayPal, right?
- [70:15]
A
And so Zelco, it's not that we're criticizing the concept of lightning. It's always nice to see more things. It's that lightning has been used by people to, to force down our throats, so to speak. Are there any egregious examples that you've noticed over the years when we were
- [70:36]
B
starting to really get Ronin Dojo going and we were adding other features and adding other apps like Electrs and Explorers and stuff like that. I think I even wrote a guide for lightning because I wasn't as practiced and lightning at the time. And so that was something that was in my mind. And then once we really started playing with it and we realized like, this one is never going to happen because there's a million apps, the development time is absurd. Just to try to keep up and try to make sure that you don't have a, you don't upgrade into a bug that can lose people's funds. There's just, there's a million things. But at the time, all the other node implementations had lightning, they were, they were. That was like one of the things. And every conference that we went to, every event, it was, oh, so can this run lightning? Can this run lightning even today? Know that we'll get that question from time to time. Most people have since learned not to ask that question, but we still get it. And, and when we were trying to secure funding in the beginning, we were looking at, you know, some like, angel investing and some. Some other stuff like that just to kind of help keep, you know, keep us going forward. As soon as they heard that we didn't want to do lightning, they immediately said, oh, okay, well, good luck. It was a kind of a unspoken force narrative as far as development went. And thankfully I had some smart people in our corner that just said, stay the course and it'll work out. And it's never been truer. Right. I was even just looking up some Lightning stats right now, and if you look at the full total capacity of lightning network versus it's about 5,000 bitcoin, and I believe that the unspent capacity of Whirlpool is almost 10k at this point. So hopefully by the end of the new year. But it just goes to show, right, that it was a forced narrative that we were told that this is what has to happen. I can't remember how many times that people, influencers on bitcoin Twitter tried to say that, oh, if you're a bitcoin company and you don't integrate lightning, you're going to be dead in two years. Or something along those lines. And that was four years ago, five years ago. It's absurd and it's just wrong. I a hundred percent agree. Like, it's not needed. Like, you don't, you don't need that. Like, people are like, oh, well, I can buy a coffee. Or people have individual cases where they say, oh, well, it works for me. And I'm like, that's great that there's a lot of things that might only work for you but don't work for everybody. Hence it doesn't work. If it doesn't work for everybody, then it doesn't work. That's the point. That's how bitcoin's supposed to work. It's supposed to work for everybody. And if it doesn't, then it's broken. And we've spent years and years and millions of dollars on investing into Lightning. And it's a sunken cost fallacy at this point. People just can't accept that it's not the solution. I hope that we can get there. I hope that people can find it, but it really is not anything more than a custodial solution, to be honest.
- [73:47]
C
Yeah, I remember Electrum, Electrum's wallet said to us, if you don't implement lightning, you will be dead in two years. And that was in 2017, I think. So we're still around, we're still kicking and we have no plans to implement lightning. And the other thing I'll say on that, on lightning is maybe people don't realize this because something we said earlier about not actually transacting, but there is such a beautiful simplicity in Bitcoin and I know it might be hard to understand that because, you know, Bitcoin is such a different thing and there is a learning curve, of course, but there is a beautiful simplicity in spending Bitcoin in that you either have the UTXO or you don't. You know, there, there is no other state. It's either UTXO or no utxo. And with lightning that's not true, right? You can send to someone and then it can fail because of routing this or that. It can get stuck somewhere. You know, know there's, there's a big question mark around it. There's not enough inbound liquidity and there's not enough, you know, channel capacity. There's not, you know, there's all of these edge cases and, and you know, failures that can happen that are just not possible to happen in Bitcoin. It's either sent or it's not. And that's really a beautiful thing. And I think that Lightning Network was entirely over engineered, entirely academic in, in how it was designed and it wasn't designed for actual use. And it's one of really the incredible and amazing things about how Satoshi designed Bitcoin where it's, you know, fundamentally at its basic level it works exactly as he, just as he designed it and hasn't been changed in that fundamental way. Yes, there's been bug fixes, yes they've done introduced new script types and all of that sort of stuff, but that hasn't changed the fundamentals of the system. You either have a UTXO or you don't. There's no utxo, can't get lost, it can't, you know, not exist. It's either there or it isn't there. And if it's there, you have it. And if it isn't there, someone else has it. It's such a beautiful system and there is beauty and simplicity. And I think that Lightning, the designers of Lightning, they failed that important metric, they failed it completely. There's way too much complexity. And with complexity, when you have such a complex system, you need intermediaries, you need people to stand in the middle, you need watchtowers, you need liquidity providers, you need this and that. That's the reason we're not seeing huge lightning uptake and huge adoption is because it's too complicated and where, where, you know, the individual can't run the system, the components of the system that are required, intermediaries will step in and do that. And that's what we're seeing happen. And why would you, why would you degrade yourself in that way when, as a user, when you can just use Bitcoin as it was designed? And that's what we're seeing. That's how people are, you know, are using it. And unfortunately, you know, some people are being onboarded directly into Lightning without ever having to interact with the bitcoin blockchain. And by and large, 99% of those people are being onboarded into custodial solutions like Wallet of Satoshi or something else. And as we just saw with Wallet of Satoshi, they're no longer able to provide services to US persons. So all the people that were onboarded into Wallet of Satoshi over the last several years got in the US got a nice little message saying get your, get your funds off of here because you're not welcome to use our product anymore. And we're going to see more and more of that going forward.
- [77:42]
A
I want to ask either of you, is there a topic that we haven't covered?
- [77:46]
B
One topic that is always kind of funny and it seems to have not been as bad. I remember how many goal posts had been moved for the Samurai team based on literally everything. Anything that they tried to do was immediately met with whether it was mobile mixing, dojo only pools. There's always been something the defaults, there's not enough default warnings or something along those lines. There's always somebody who had something to say just because they didn't like Samurai Wallet. So what we like to call the click. Not necessarily a long history, but there are definitely individuals who consistently gone out of their way just to spread stupid fud. And then when the FUD is met up against something, then they just move the goalpost again. One example is talking about the dojo only pools and whirlpool needing to be decentralized, coordinator being an issue and needing to decentralize. And all of a sudden now with, with the whole knots and operator and stuff, then it was oh, the solution should have, should have always been you guys were stupid for setting it up this way and you guys should have, should have always had a centralized database.
- [79:10]
C
Yeah, I couldn't believe that that was a new one. Well, it's true. From day one we have been Fighting an uphill battle. You know, we launched as a closed beta software in 2015. We had maybe 50 testers or something like that. And the way that you had to become a tester was by emailing us and saying you would like to test. And so we had 50, 50 testers in 2015. I remember it very well. This was back when the Bitcoin subreddit on Reddit was like pretty popular and, and everyone was there. Now it's, I mean, I'm sure it's still popular but no one, no one really hangs out there who's worth anything. But back then it was kind of a big deal. And I remember there was a, a post on there from. I'll never forget the user. It was Poop Wallet Narwhal and it was obviously a throwaway account. I know who was the true author, but I'm not going to say their name because they made it under a throwaway account and there's no need for me to attribute authorship to them. But it was a pretty thorough indictment of what we were doing. There was a lot of, of shade thrown that we were using third party APIs to, to query nodes, query balances and transactions. And of course this was true, though it was not something that we tried to hide or anything. All 50 of our users at the time were very well aware of the third party API we were using. In fact, at that time it was one of two API providers that existed in the market and most people were using them. But I remember that and basically the consensus of this Poop Wallet Narwhal was that no one should use Samurai, they're completely incompetent and that, you know, the, their stuff isn't worth even looking at. So we obviously disagreed and we continued developing what we were doing. I responded on the Reddit saying it's true we are using third party APIs to do this, but this is the reason why it's a closed beta and we're not making it available for everyone. We will make it available for everyone once we stop using third party APIs. And then so fast forward a little, little while later and we finally built out the infrastructure so that we could, we didn't have to query any third party APIs. We ran our own node with our own API server, which would eventually become Dojo. And so that, you know, that goal post then had to shift. It wasn't now. The issue wasn't that we were relying on third party APIs. The issue was that we were relying on one API, our own centralized API. Okay, this is true. But also we had already stated that the work and the ideal was to open source that API server and provide it to users once it was ready. At this point we were a team of two, so things took longer than we would have liked but. And we didn't have any investment or anything like that. So that goal post shifted to that. And then so we continued developing and users continue to come in. Now we have several thousand users by this point. All of which understand that, you know, unless you're running your own node, you have to rely on someone else's node. And back then, now we're talking like 2016, 2017, there still wasn't a lot of node runners out there. You know, most, most people who were connecting to wallets were either connecting to Core very few or using a mobile wallet like Mycelium or Samurai or blockchain.info copay was another one. At the time, all of them had the same exact architecture we did, but it was only us that got targeted for this. Then 2016, 2017, we, this was during the block size wars and we innovated and figured out a way that you could not use your own node to query blocks and stuff yet, but you could connect your own node to Samurai so that you could verify that Samurai wasn't lying to you by the information that you were, that it was feeding back to your wallet. We were the first to do this and we got a further goalpost moving saying, well, they're letting you connect to your node, but it's not good enough. You're not feeding the, you know, the transaction history, they're just feeding the proof of work header. And you can. Your wallet is comparing a proof of work header. Okay, that's true, but we're still working on getting out the full node based stuff. Fast forward a little bit. We finally released Dojo and this is the API server that people have been waiting for for us to open source, which finally came. It's out there, people are using it. You have people like Zelco who started Ronin, Dojo, forked it and built a beautiful solution for it. We actually had Whirlpool ready to go before that, but we refused to release Whirlpool until users could run their own node self sovereignly separate from us. And so we delayed Whirlpool until we launched Dojo. Once Dojo was launched, we launched Whirlpool so that users could connect to their own nodes, bypassing all of our infrastructure. And then as Zelco stated, the goalpost moved from that to well, you need dojo only whirlpool pools. Otherwise you're going to be mixing with people who, who aren't running their own nodes. We're like, no, that's, that's just going to divide liquidity and make it less, less of a robust solution for everybody. We'll continue to have one liquidity pool but don't worry, other wallets will join in. And those wallets are essentially it. When, when if you're thinking about it in those type of adversarial terms like that Samurai Wallet is malicious. Those wallets don't share any information with samurai so they are effectively running their own node, quote unquote. Then down the line we have Sparrow joining, we have Bitcoin Keeper joining, we have another wallet that's in the works joining. Every step of the way there's been interference. There's been people like Luke Jr. Like Peter Todd, like all these people who have stated that, you know, we're incompetent, that, that our stuff doesn't work. But the thing is the market has spoken. The market is saying no, it does work. If it didn't work we would actually have real, you know, we would have real examples of it not working. Not these theoretical, what about this? What about that? So you know, we were born in the fire. We've been fighting a long time with people but at the end of the day our stuff speaks for itself, our code speaks for itself and our results speak for itself. Like I said earlier, it's one thing writing code and putting out code, it's another thing putting out a product that people want to use. And we've proven time and time again that what we put out, people want to use it. The market has spoken and that's all I can say.
- [86:25]
A
Well, thank you both for sharing your knowledge of the politics behind Bitcoin. I hope this is been informative for people. And the best way to support Samurai Wallet is to use the Samurai Wallet or Sparrow and get into the whirlpool because they get some of that as compensation for their work. And the best way to help Ronin Dojo is to go to Ronin Dojo IO consider buying something they have including their excellent pre built nodes. That's a fabulous way to support them and thank you both so much. Zelko, final thoughts?
- [87:01]
B
No, just man, it was a great talk. I appreciate you having us out here and yeah, just continue to use the tools like that's really what this is about and learn the learn why. You know, I think there's plenty of information out there But I think sometimes we also get into the mode of just like, yeah, we'll pull everything, but understand why, why it's important, because it is. But understand like what, what does that mean and what does it mean if I'm going to spend and how do I spend it privately, like, take the time and thank. Thankfully there's people like Gabriel that have great podcasts like this that actually go into it, but use the tools and, and just use Bitcoin the way it's supposed to. So enjoy spending it but, you know, save as well. Do whatever you need to do. It's your money.
- [87:51]
A
And Samurai, you had a good final statement there in your last question. Could you maybe give people a couple places to follow you or participate in the Samurai Wallet community?
- [87:59]
C
Yes, absolutely. You can follow us on Twitter Amurai Wallet and I would recommend joining our telegram group. I think it's SamuraiWallet. Lots of conversation, lots of discussion happens there about Samurai, about privacy in general. And you know, I'm, I'm quite active in there. People like Zelco are quite active in there. It's a great little community. You can visit us online@samuraiwallet.com s a m o u r a I wallet.com editorial note here.
- [88:32]
A
That website that Keone just read out, don't go there. It's owned by scammers at this point and Samurai Wallet has been shut down. Hey, thanks for listening. I could really use your help. Real quick if you could share this episode with someone, engage with me, leave a review anywhere. This helps me to break the technocratic shadow banning that is happening with my brand. And of course, if you really want to escape the technocracy, go to escapethetechnocracy.com privacy tutorial, series, books, newsletters, consulting and of course you can leave a donation. Thank you very much, Sam. It.