[00:03:02] It’s still a database out there in the network that is its great. Majority use is for monetary purposes. Which should be really, but anyways, so let’s say that we do have some fee spikes here and there. There, that does help feed miners as well, but I don’t think they can plan for that. I do believe though, that the trend is very clear.

[00:03:24] We’re not going to see base layer being packed again. it’s still going to be probably more than what we have right now. Right Now it can practically do one set V by eight,

[00:03:34] I still think we’re going to have moments like this throughout. Like ever in Bitcoin. But the reality is, A-U-T-X-O is just going to continually be more, and it’s going to be less necessary to move the ownership of that UTXO on chain as people realize that Bitcoin is the great store of value.

[00:03:54] They can use other layers to settle or quasi settle, right, and save on fees. So for example, lightning, right? Like you can do a lot of back and forth on lightning before you decide to settle. The same is true for arc. What’s coming and do the same is true for coin backed equities, right? like you can almost think that’s another layer in Bitcoin.

[00:04:17] I want to get to the arc comment, but before we do that, I’m just, I’m trying to think, 20 years from now, are we still going to see Pols that are one SAT per vb, and if so, is that an issue, I guess is really the question? 

[00:04:32] I don’t think it’s an issue because if the price goes up, the reward that is a lot less in terms of Bitcoin units.

[00:04:40] It’s still going to be a lot more in in dollar. 

[00:04:43] So you’re saying the block reward alone because you’re getting this doubling, and you, if let’s just say you take Saylor’s model as far as the price action and the appreciation over the next 10 to 20 years. You’re saying that even though that block reward is still minuscule. It is enough because of the really quick math that you explained is all it has to do is go up by double every four years as far as Yeah, the price value, 

[00:05:06] yes. And there is more to this, right? Because you know the fees, Bitcoin fees are also Bitcoin unit based. They’re not dollar based. So even if people are transacting a lot less on chain, right, because they don’t want to spend those very responsibility XOs. In fees. Those fees might still economically suffice because mining is USD denominated. Because mining users has to pay electricity in dollars. It has to pay rent in dollars, it has to pay for hardware gear in dollars.

[00:05:39] Employees salaries are still denominated in dollars. So I think there is a case for that. I can’t predict the future. I know for a fact that not for a fact, but I have a very strong belief that we’re not going to be changing the Bitcoin cap to inflate so that we can pay miners to them.

[00:05:58] Yeah. Very likely to happen. And if that did happen, I got from the Bitcoin I. Which I have not, but I would dump it if I had any. You got a smile out of me on that one. Go ahead. Yeah, no, I think people worry too much about these issues that are resolvable by number go up. Yeah. and then it’s the like, seriously, if Bitcoin is not double in 20 years, today’s price, the experiment likely failed.

[00:06:21] Preston Pysh: Saylor talks about this from time to time where he is the bigger concern that I have is people really campaigning for this idea of adjusting anything and not just letting the fundamental, he describes it almost like physics, I. if we changed how much gravity there was that we were experiencing here on Earth, like you’re going to wreck havoc in all.

[00:06:42] NVK: All fields. These are very, how do they call it? It’s a very sensitive formula, right? Yeah. Like we have a literal formula for how Bitcoin work and if you change one a variable, everything, the system changes, right? Yeah. With the problem changed a little bit of the formula with the discount.

[00:06:58] For the data that’s printable. And that did change Bitcoin economics a bit, wanting or not? It did. Yeah. If we had not increased the block size, miners would be making more now in fees maybe. Yeah. Yeah. Maybe not. It’s hard to know. You can’t apply central planning. This is the cars that we would dealt.

[00:07:16] Now let’s just use the cards that we were dealt in the best way we can. I do like his analogy where it is not moral or ethical to change the rules when the game already started. I think that’s a very good way. Of framing this, some of these issues. That’s not to say that we can’t upgrade Bitcoin with other technical necessities.

[00:07:40] For example, covenants. Aside from making, maybe people lose more Bitcoin in case they do it wrong, because then they’ll have proof of work, which is great for everybody. Really. There is no economical change to the Bitcoin model, right? It just means that now Bitcoin is. If we do it right, we can now create vaults that are protected by the Bitcoin, the same way that the Bitcoin units are protected by Bitcoin.

[00:08:05] Preston Pysh: I want to come back to this one as well. Sure. But we need to frame it up a little bit more for the listener before we do that. Okay. So on this idea of not changing the fundamental units or incentives inside of Bitcoin. There is a massive debate for people that are really dialed into this stuff. I think for people on the fringe, they have no idea that this debate’s even happening.

[00:08:28] But for people that are really dialed in, this debate between Bitcoin core and Bitcoin knots is just somewhat crazy right now as far as the conversations online, and I think for casual observers or people that own Bitcoin as an ETF or whatever, they don’t even realize that this discussion is taking place.

[00:08:49] Good thing, which is probably a good thing. Well help explain this, like in a really, really basic. Level, first of all, explain what Bitcoin core is and what they do, and then let’s talk about just kind of like what has materialized as far as the debate. And then third, I really want to try to talk about is there risks here from a consensus standpoint.

[00:09:13] Is there a risk that we have to competing software versions cropping up? Let’s first just frame it for the audience. You’re very good at framing things and making it simple for the casual listener, so frame this up for them. 

[00:09:25] NVK: Okay, so what is Bitcoin, right? Like in terms of technically rule set? Bitcoin was never defined in a spec document.

[00:09:34] Like most standard, they have a spec document you’re saying in the white paper? Yeah. The white paper doesn’t define Bitcoin minutia. Right. When you build technology, especially protocol technology, you go out there and you write a huge spec book, like it’s like literal book that if you go from spec to software, you can rebuild the protocol, right?

[00:09:57] Like you don’t need software. To begin with, you just need the PAC book. Mm right. Okay. In Bitcoin, we didn’t have that. What we had was the Satoshi client, which is the original Bitcoin client. This, it got renamed to Bitcoin core, but it really is the Satoshi client, the regional Bitcoin client. Okay. It was the software the Satoshi put up and it was a bit macaroni code.

[00:10:18] Preston Pysh: It’s like a single guy just getting at it. There was no real spec for it. And I heard Jeff Garza say this many years ago. People have their opinion on Jeff, but he said, he said many years ago that when he first saw the code, he was like, wow, this is. A disaster. It seems like you have a similar, and I say this, we saw the cold the first time, we’re like, no man.

[00:10:41] It’s brutal. Really. So that was your same opinion. Yeah. the beauty of Bitcoin is that the concept of it, right? Like the economical formula and the game theory adjustment, the game theory and all this little sort of the game theory, everything. The defines of Bitcoin is just conceptually, right.

[00:11:03] It is absolutely beautiful and brilliant. Right. That there was Satoshis through brilliancy, right? Yeah. It’s actual cold implementation. it’s pretty brutal. I’ve heard this, the original Satoshi client poker in it, like the beginning steps for a poker A client, for example. Is this why we have 21?

[00:11:25] Who knows, right? But. So like we have this brilliant concept. Yeah. I, I’m sure if you got Einstein right, like after he figured out the concept of VMC Square, right? if he tried to write a program that then goes and make like a atomic model stimulations, it’ll be code.

[00:11:42] We already done enough. It’s amazing. 

[00:11:45] Do you think? Thank you, NVK. Do you think that this points more to this being an individual as opposed to a group because of the code looking like this? 

[00:11:53] NVK: No. I mean like you can also make the case that the group decided to call this extremely poorly with windows just to make a point by design.

[00:12:01] Not discovered too. Like it’s one of those rabbit holes. If you asked me, I believe Satoshi was probably a person who lived outside of the law, maybe had. It’s bumps with the deep state. So like it was somebody who deeply understood what they were doing, how the world really works. It’s a great way to put it. 

[00:12:20] Preston Pysh: Yeah. 

[00:12:20] NVK: And remember, right, like when you get into the very lower levels and layers of society and state actors and things like lawlessness is a lot more prevalent. You know what I mean? How things are done than people think. That they are. 

[00:12:37] Preston Pysh: Like it’s from a global point of view, you’re saying?

[00:12:40] NVK: Yeah. No, but even government, I mean remember like the Navy worked on tour and they funded tour, but that’s where the dark markets are, right? When you get to peak engineering, there’s a lot of like people who do illegal ’cause they understand the world. There’s a lot of people who just geniuses.

[00:12:54] It’s like a big mess. That’s just a tangent there. But then the point is. The software was not ideal and it was like extremely redone through the years refactored, right. From a lot of different engineers that were provided there. Oh, oh yeah. Like thousands. Yeah. Thousands of people have worked on Bitcoin core.

[00:13:12] There were different sort of like quote unquote leaders. There were a lot of leaders. There were. Played heroes. Like the drama is Plen full and it’s an amazing story of 16 years of turnover. Right. But at one point, I can’t remember, it was just before Gavin maybe, which was the guy that Satoshi essentially like he did a bit of like a role of leadership too.

[00:13:36] And this is Gavin that you’re referring to for people listening? Yeah. He might have been Mike Hearn, which was a spook, allegedly. Well, Mike was out of Google, right? Yeah. So I think that the story goes that he was the guy who allegedly put the back door from Google, but that’s a different story. I don’t want to let people go dive into that one.

[00:13:54] But anyways, the point is, around that time it was suggested that we split Bitcoin core. Bitcoin into two parts. The wallet part, right? And the consensus code part. And the consensus code part was going to be called Bitcoin core. It is very common to have the core part of software being the part that’s transportable between different clients and things.

[00:14:18] It didn’t transpire much that way just because it’s the monument task. We’re still working on it. There’s a few different initiatives on working on that, and it became all those things. Like the software is the spec and the spec is the software. It’s like very hard to move away from that. So Bitcoin, although simple, is extremely complicated and there is a lot of nuance to tiny little things and things affect each other.

[00:14:40] So anyways, so we got to this name called Bitcoin Core, and instead of just Bitcoin. And Bitcoin core just meant to be the main sort of implementation of Bitcoin, which is really the direct, the standard derivative of the. And, not even a derivative really direct, it’s just it with the same cold base just being worked on.

[00:15:00] Now, at what point did Luke come into the timeline? Oh, was because this is important to, was it was around early, very, extremely early. Extremely early. I, I can’t remember, like 2010, early. Allegis was the name of his mining pool.

[00:15:15] Preston Pysh: Which was the first, and I can’t remember the date. Was it the first mining pool?

[00:15:17] Is that right? I can’t remember. For people listening, we’re talking about Luke Dasher, and the reason that I bring up Luke and why it’s important is because he’s the one that’s really spearheading the whole Bitcoin knots, which is the competition.

[00:15:29] NVK: I remember this funny. He has a history of wanting to do filters. Look when from actually forked Bitcoin poor, but remain. He kept it. In consensus with Bitcoin, right? So if you ran, not, you don’t fall off consensus. At least for now. You never know. And I remember he had, and that’s you. You never know for things blacklisting, for Satoshi dies. There was a bunch of stuff.

[00:15:55] Preston Pysh: But NVK, I really want to foot stomp that comment right there because that’s where we’re really going with the third part of the question, which is there a risk in there being two competing versus there’s always a risk. Yeah, because remember the SPAC of Bitcoin is the software. As long as if you don’t change anything that is consensus.

[00:16:16] You don’t fork. Even if you decided to make your softer pink, blue, it doesn’t matter, right? As long as the transactions are valid and you’re validating transactions that get mined, you should be good. So I doubt that they would choose to make changes that could make them fork out because like reality is the majority of the economic actors in Bitcoin.

[00:16:39] Economic nodes really. So large nodes that are validating transactions and have lots of coins and they are all running a version of, or a lot of miners do run patched core versions because they have different needs, especially 

[00:16:54] around mempool policy. So that’s not something I was aware of. Okay.

[00:16:59] Explain that a little bit more. 

[00:17:00] NVK: Well, you can go even from basics, right? bitcoin core has a limit on the size of the man pool that shows, right? and if you’re minor, you might want to expand men pool with even more stuff in it. Okay. you just have more competition power.

[00:17:14] Preston Pysh: So they’re running like basically their own version of core, but just allows them to see the men at a larger level.

[00:17:21] NVK: Okay, and from time to time people will create a transaction that’s not really valid on the core men pool, but it is valid in a block. Things happen. I don’t have the examples in front of me, but the point is like there is some, as long as the transactions are valid on a block.

[00:17:42] You’re pretty much good, even if you deviate on how you do little things. Yeah. And that’s like where it goes. and then you have all the soft policies, right? all the standards as they call it. And that’s where there’s a lot of disagreement. And it’s funny that like the disagreement can happen because these are not consensus, hard consensus rules.

[00:18:06] Preston Pysh: Which goes back to your original comment that there was never a spec sheet that went out with the protocol.

[00:18:11] NVK: But there’s been a lot of people who are very smart who made the software a lot better. Where it from your man, we have a better view of the, that’s by the way, the argument the core has for some of the removal of the opera return.

[00:18:27] A limit, things like that. Is that like their argument is that you get a better view of all the transactions in the man pool, so it can calculate fees better, for example, and you need disincentivize centralization, right? But then the other side of the argument is that you would incentivize people to make non-monetary transactions of Bitcoin and incentivize them to bloat the network with large op returns.

[00:18:55] But up returns are printable on the other side, like it’s a bit of a waste of time to fight too much over the minutia on this. I think the biggest problem right now is this is more like a meta comment, is that see like the people who work on Bitcoin core are volunteers, right? And they’re humans.

[00:19:17] People. Humans love to. Create groups and people group themselves based on their preferences, and then they tend to go in a certain orthodoxy together, right? that’s the most human behavior. And the core is mostly managed from a software management perspective on GitHub and GitHub bought by Microsoft.

[00:19:45] It is a terrible place. For you to manage software that is contentious. Right. And mind you like the more valuable Bitcoin becomes, the more contention there’s going to be, even the smallest changes, right? Because E affects everybody’s bank. So everybody might have an opinion. But the thing is fee like core Bitcoin core Satoshi client does not have automatic update on purpose.

[00:20:11] And if there ever is, that is when you stop updating is before you have auto update. That’s when you break out the pitchfork. The Alto updates is a form of like user management in a way, right? Like now, if we had software updates, core could make changes that the network would take up without being fully agent around it, right?

[00:20:36] Agency in the software you choose in Bitcoin, or the update you choose in Bitcoin is very important because then people cannot take you. Without your sort of explicit approval or knowledge. Into forks that may not be good. say for example, inflation or something. Right. The point I guess is that core, this group, the current version of the group, ’cause the group changes all the time too, and it’s a lot of people and there’s like the main maintainers, sub maintainers, that relationship also changes all the time.

[00:21:05] It does have a monopoly on the distribution of the Bitcoin code, right? Like the majority of the Bitcoin code is core, especially when it comes to economic actors and when they choose to deploy a change, even if it’s stinginess, so non. Hard consensus rules. Even if they don’t push updates as automatic updates, like it still causes the network to probably adopt their version, right?

[00:21:34] So they do have power and which power comes a lot content. So personally, I think we’re starting to get to a point where maybe expediting. The division of the wallet software from the consensus part of core may be extra important, and then incentivizing people to maybe have their own versions, like more versions of core that try to not touch the consensus code.

[00:22:03] Preston Pysh: Important. This is real. So basically you’re getting back to the spec sheet is let’s break this out. Let’s all agree on what those specs are and then on the areas that aren’t risked to consensus long term, then let people build their own versions.

[00:22:18] NVK: Exactly. And then if you over filter it, it just means you’re going to have a very poor view mm-hmm.

[00:22:23] Of the mempool. Yeah. But then, maybe you’re just have a lot of social pool. And you can incentivize people to run some filters that maybe. Better for the Bitcoin. block bloat or whatever. Like these things become very loosey goosey because again, they’re not hard consensus, right?

[00:22:47] And if you overdo something, then you just fall off in a way you can think about it that way. 

[00:22:53] Preston Pysh: Do you think, do you think that we could get agreement on what those technical specs are to put in a nice, neat order and then allow, because it seems like right now that wouldn’t be the case. The, it just is just too big.

[00:23:06] NVK: Like the, the consensus part is just too big. So yes, anything is possible, but it’s, it’s completely unrealistic. So there is a project called Lib Consensus. And who is working on that? I think it’s a Charlatan is working on that. lib, like you would put a lid on it? Yes. Okay. Lid? No lib, like library. Oh, okay.

[00:23:28] Lib. Yeah, so lib consensus and the goal of that project is to separate the consensus code from which is 

[00:23:37] Preston Pysh: the original core concept. Interesting. Hey, I want to try to frame this real sim ’cause we talked a sure about a lot of different things here. I heard a lot, and I want you to correct me if I’m saying any of this wrong, but the debate, if I was going to really break it down simply, you have this op return and today it’s at 83 fights.

[00:23:57] This is a policy rule. Bitcoin core has been enforcing this limit of 83, and anything larger than that is considered spam or something that is being obtuse in a block and Core has come out and says, we’re just going to lift this, and if you want to create a. Mammoth transaction and there’s probably a bunch of JPEGs or whatever in that block, but you’re willing to pay the high fee, then we’re just going to let the fee market figure out what should go into the next block and what shouldn’t, and we’re just going to lift this 83 limit.

[00:24:30] Am I, did I say something wrong there? 

[00:24:32] NVK: No, no, no. That’s correct. It’s just, I think there’s, the just two little things are important on that. Yeah. One is that returns are printable. So that means you can remove them from your No. So you don’t have to store them.

[00:24:44] Preston Pysh: You do have to process them. But you don’t have to store them.

[00:24:47] Okay. Which is important for, and the reason why this is important is because if you don’t want to store four megabytes of somebody’s jpeg on your node, you can basically extract that out and you don’t have to store it. And it’s not going to take up all the memory and, am I? Yeah, yeah. Correct. Okay. That’s correct.

[00:25:03] Keep going. What was the second point? Sorry, I forgot. Oh, man, I messed you up. I’m sorry. When I start talking, I guess it’ll, it’ll pop in your head. Let me, yes. Keep, go ahead. So. The thing that Luke is really getting behind with Bitcoin knots is he’s saying no, this 83 fight limit still needs to be in place.

[00:25:21] And this is here for a reason. And if people are running a node like myself and many others, that we have 20,000 plus people running their nodes. If they don’t want to relay a transaction of a bunch of JPEGs, they don’t have to relay it in this gossip network of, these are the transactions that are trying to get into the men pole.

[00:25:42] So if somebody’s trying to put JPEGs in there and I’m running my own hardware, my own node that I paid for, and I’m, I’m spending electricity to run, if I don’t want to relay these transactions that are over that, well then now I have. The ability to do that and Core is removing, my understanding is that Core is removing that ability for me to filter transactions that are over this 83 bit limit, which is a somewhat arbitrary limit, but it’s the ins, well, 

[00:26:10] NVK: the limit came in way back then because there were issues with very unsavory things that could be put into Bitcoin blocks when Bitcoin was very small, and that could have been an excuse to shut it down.

[00:26:23] And 

[00:26:23] Preston Pysh: I think 

[00:26:23] NVK: we know where 

[00:26:24] Preston Pysh: you’re 

[00:26:24] NVK: going with that. Yeah. Yeah. So nowadays it doesn’t really matter. I’m sure people put stuff that shouldn’t be there anyways, but you can’t turn it off anymore. It’s no, it’s the blockchain and the Bitcoin. Yeah. MicroStrategy owns some. Yeah. like it’s a different environment.

[00:26:40] I’m not a huge fan of removing that limit. I’m not sure. It’s a great use of time.

[00:26:45] Preston Pysh: Well, this is my point on it. MVK is why take that optionality away from me as a person who’s running a note. If I want to limit it, I should be able to, if I want to open it up and and allow whatever to be put in there, then you should have that option as a person who’s choosing to run the hardware and the software that you paid for.

[00:27:06] NVK: the argument as I understand is that because they’re the reference implementation. They’re trying to optimize for maximum visibility of the mempool, and that includes transactions you may not like. So it’s just that okay, this is the reference, so let’s make sure that if you’re running the reference implementation, you can see all the transactions.

[00:27:29] They include the ones that you don’t want to see happen. Because like reality is for literally ever, miners have taken out of. Bound or out of Bem fool direct transactions from people to mine. It’s like trying to change the master branch to like main branch on GitHub because it’s like, it’s not woke the same master branch or something.

[00:27:51] It really just riled up all sides where no reason where, we should be arguing about like more interesting things.

[00:27:59] Preston Pysh: Well, I definitely agree with that point that there’s other things that are more important to be discussing. I think the issue in why this turned into such a big deal is because of it was the method that Core used to roll it out.

[00:28:13] Would you agree with that? It was the method at which core totally, it was terrible. It 

[00:28:18] NVK: was very poorly managed. That GitHub issue it, all this, it’s I don’t, I feel for them to, because managing that, like managing GitHub and seeing a bunch of people like posting ai, aided answers to fight on that thread was very, very.

[00:28:37] I be pissed off too on cold card. We close the issues ’cause we just don’t have patience to deal with a lot of trolling. But again, it’s like the reason why Bitcoin core was so like respected and so above, it’s because they always managed to be above it all. Orion, which was one of the main maintainers prior to now, always managed to be, remain fully impartial.

[00:29:01] Try to just keep things. And just left people like fired out on threads and things. Moderation. Again, I was saying GitHub has very poor moderation tour. Mm-hmm. Tools. Or open source software, but at the same time, like the way that, like you almost feel like a troll opening. The PR too, the way that the P was open, it was very poorly done.

[00:29:25] Like everything around this issue was poor management, poor behavior by all sides, just all overall garbage. So you know, you end up at the place you’re at with people screaming at each other on Twitter. 

[00:29:40] Preston Pysh: Let’s address this right now from your point of view. Is this a long-term concern? So you have people that hear that last half hour of us talking about this, and all they really want to know is, yeah, no.

[00:29:51] Is this an issue? It’s not. No, it’s not. No, no, no. This is do or die from Bitcoin. It’s just. How can we move as a community? I think for me, I’m looking at, I’m saying how can we move forward as a community in a more constructive way, in a more thoughtful way, and make sure that we don’t destroy the consensus that already exists on this protocol.

[00:30:10] NVK: No. See, like this is the thing. I’m on the other side of this. People should be even more against each other. I just don’t want to see the discussion. But like Bitcoin game theory is amazing for the, the more people don’t like each other, the more Bitcoin doesn’t change. You’re going to get like flare ups.

[00:30:25] On the nons consensus code, like the operator turn, size, filter, something like that. But realistically speaking like this just makes Bitcoin stronger because it can’t be changed, is your point. Yeah, because it’s going to be even harder to make any changes, right? Because now you have even more people who disagree, more people who don’t trust each other.

[00:30:47] So there is more scrutiny is amazing. Like you want Bitcoin to be as adversarial as possible. 

[00:30:54] Preston Pysh: Which is interesting, right? That’s like what other thing exists in the world that that would be the scenario of more disagreement leads to stronger entrenchment of the protocol, 

[00:31:04] NVK: right? Yeah. it’s unpleasant and I hope that people can keep the discourse to a more polite and gentleman like discussion.

[00:31:14] You don’t have to go tell people to do something to a goat. But in all scrutiny, adversarialness, these are all like parts of the Bitcoin game theory, so it’s okay. I think when people see people disagreeing around Bitcoin, it means that’s a good thing. There is like what could kill Bitcoin as apathy?

[00:31:33] Let’s put it this way. If there is full apathy, Bitcoin dies because then people just take Bitcoin whatever direction is useful to them, like democracy kind of thing. And then it gets gamed out. And then it dies. Right. And now if people continue just having very fervor, orthodoxies around Bitcoin in their, no, it’s great.

[00:31:54] Alright, let’s move on. For sure. 

[00:31:58] Preston Pysh: Let’s talk about Noster. You and I are hardcore, primal client users and promoters and we love it. And I am just very bullish on Noser. I’m curious to hear, ’cause I haven’t had this conversation with you for a while, I’m curious your thoughts on the status of noser, where it’s at right now, where you see it going and maybe I.

[00:32:22] Most importantly, your description of what is it? Because I think people looking at it today would say, oh, it’s a replacement for Twitter. It’s decentralized social media. But my opinion, and I suspect you agree with me on this, is that it’s something way bigger than that. It’s identity layer, decentralized identity layer, and, and so what in the world does that mean?

[00:32:44] Give us your thoughts. 

[00:32:45] NVK: I personally don’t like no four identity in terms of logging in to sites and things because it links your identity to log in and sites and things. But I love it as a way to find identities, right? So you can find coordination like an address book that nobody controls. ’cause email is an address book, but.

[00:33:09] email depends on domains. Domains are centralized, but you can lose your domain, right? But nobody can take away your private keys, your not so private keys unless you lose them. So it’s super cool that way. Great way to find people. There is like a lot of work being done so that you can find privacy in the interaction between your identity and maybe services.

[00:33:28] Then the login with Noster will become great. Just think about Noster as like a decentralized. Non authority way of having identities and address book, right? So we can send payments to each other. You can send messages to each other. AI can have their own private key pair. So you can have AI agents that can talk to each other, they can find each other, and that sort of opens this huge design space for everything that is on the internet.

[00:33:56] It sounds a little out there, but that’s almost everything that’s on the internet could leverage noster in that sense. So it really is just an open protocol for communication. 

[00:34:06] Preston Pysh: Are you suggesting that AI wouldn’t be able to get around that in some other way? Like they’d have to use a noster decentralized protocol to

[00:34:15] have an identity?

[00:34:16] NVK: I could. They could use a centralized system too, and they do now, but then again, they’re depending. First of all, they’re using a design space that was not designed for them to use it in that way. Right? So like the internet the way is designed today. The protocols that we have, like M-O-H-T-P and those things, they’re not natural for proper payments for guys to talk to each other and all that stuff.

[00:34:41] Right? It’s very inefficient. Nora, on the other hand, is you have this essentially signed defense, signed messages, which. Public key cryptography that are extremely efficient for this kind of behavior. And they’re going to be smart enough to understand the value prop of Of Exactly. Yeah. Exactly right.

[00:34:58] Yeah. And then from the user perspective too, like you gain the fact that nobody can fake with an AI or Photoshop your noster tweet. Right, like which is the rage Big deal now. like it’s clearly big deal. 

[00:35:11] Preston Pysh: Yeah, right To the point that I just said, I think that’s one of the biggest hangups that we have today on Noster is people just don’t understand the value prop.

[00:35:20] we’re having a hard enough time getting people to understand decentralized money. Let alone decentralized speech and identity. 

[00:35:26] NVK: This take time, like it took 16 years for Bitcoin to be a hundred thousand times more than $1. It took 12 years for public trade companies to publicly talk about their Bitcoin pile.

[00:35:38] It takes time, and when you look at these things in the timescale. That human alter altering technologies normally have. It still has been nothing. Right? like gold had 5,000 ears, Yeah. Yeah. And the printing press had what? Like 200 now? 300 now? No more. When was Guttenberg? It was 1200.

[00:35:59] Anyways, long time. The point is, is things take time, right? And we’re all like, the people who understand these things deeply are anxious to have everybody else understand. And the people who don’t understand it, it’s like, what do I care? Like my life works, right? So it takes time for these two things to covert and converge, but we are moving, right?

[00:36:18] Like master comes in waves the same way the Bitcoin price, for example, does, because it’s the adoption wave, right? And it stays true for Bitcoin. It’s an adoption wave, not the value wave. It’s moving. we have then like layer three Bitcoin payment systems that leverage noster natively, like cash tokens and, ti all these other technologies for payments that do, they wouldn’t work as well on Twitter, right?

[00:36:44] Unless Twitter integrates them. But like on noster, you don’t need permission for that, right? Yeah. You can just, yeah. Leverage. No. And now we have payments. You can tip people, right? You can do all this things. So as the build out happen for very user friendly, obvious value propositions, right? I. People will start migrating over, right?

[00:37:04] Like for example, no. Or long-term forms. Our long-term content, it’s like, it’s already better than Substack, and you can get ti and you’re not blocked by Twitter. Yeah. 

[00:37:15] Preston Pysh: Which is a big deal. I just, it’s just hard getting people to understand the value prop. It really is. I was in South Korea recently and there was a friend that we introduced.

[00:37:30] To Noster via Primal, and they got onboarded. They actually got a lot of followers and like most things, they just didn’t pay attention to it for a little bit because they had some people help them get all set up. And of course they lost their private key to their noster. And they were asking me, they’re like, okay, so who’s the admin that I need to talk to get my access back?

[00:37:56] And I looked at the person and I was like, well, it doesn’t work like that. It’s gone forever. And then they were like, well, I have 5,000 followers or whatever on Nostra. I was like, yeah, well you’ll never make another post again. ’cause it’s gone. It’s very 

[00:38:09] NVK: common for early adopters to get burned. Right?

[00:38:12] Like the amount of people who lost Bitcoin in the very early days, people who bought like literally a hundred thousand Bitcoins for like nothing. Yeah. For a hundred bucks. They lost coins because the tools in the early days of Bitcoin were very poor. They gave poor experiences and a lot of people don’t come back.

[00:38:30] So there is this turnover that happens in early stages of technology. People just, they get burned by the technology. They don’t want to come back. So we don’t depend on them. like Bitcoin has moved on. Even if the people don’t like Bitcoin because they lost Bitcoin, right? Like the hard drive is in a pile of garbage or something.

[00:38:46] But, so 

[00:38:46] Preston Pysh: MVK 

[00:38:47] NVK: to, to this 

[00:38:47] Preston Pysh: point, I’m looking at it and you’re an engineer, you’re a person who understands things technically at a level that, you’re the 0.1 percentile in the world. I come with an engineering background. Some of this stuff is somewhat innate to us. We just wrap our head around it quicker because of how we’re wired.

[00:39:06] Most of the public isn’t, maybe they’re in marketing, maybe they’re in whatever, and they just don’t have that technical foundation. And so when they come across something like this and it, the app says, oh, remember these keys? They’re like, okay, yeah, yeah, yeah, I got it. ’cause they’re used to just how they’ve interacted with everything else on the planet, which is, I can always be bailed out by some administrator.

[00:39:27] To save me. And I think that this, I don’t know. I think that this is a way bigger deal and a bigger hurdle for us when it comes to noster, specifically over Bitcoin. I think with Bitcoin, people know it’s money and that they probably need to pay a higher level of attention to it. But like when it comes to noster, I’m just more concerned as to that variable and that roadblock is just the competent, the technical competence of the everyday person.

[00:39:56] And I’m saying this on the back of just coming from the DMV, right? I literally was at the DMV for two hours this morning. Okay. 

[00:40:02] NVK: But you’re a little jaded though. I think. Listen, it’s not a matter of being smart, not being smart, just be having, if you want to be an early adopter, you just have to have higher pain tolerance.

[00:40:13] We don’t have to onboard the normies yet. The same way we didn’t have to in the Bitcoin the early days people will come as the value proposition is high enough for the level of pain that they will have to endure. It’s just the nature of new technology. Mm-hmm. But, but the thing is like the change is massive.

[00:40:31] Like I lost my first no private key that I used for the whole first year. That’s gone. And then, and then I semi lost my current key, but then it was reversible. But the point is that the tools were very rudimentary then. They’re much better now. And if you do go to Primo’s, the only tool that I would recommend to an Army, it’s if you go to Primo and you create an account there, the chances of you losing your keys are pretty low.

[00:40:59] They’re not zero, but they’re pretty low and it’s going to get better. Right? Yeah. once we have better signing, schemas or social recovery, whatever is the solution, right? It gets better to that point. You may never be as good as Twitter in terms of recovery because you own your keys. It’s the same with 

[00:41:15] Bitcoin.

[00:41:16] Preston Pysh: Yeah. there’s a social recovery. Some of the ideas that you’ve seen born in Bitcoin that I think you would strongly argue are terrible ways to secure your keys might act, and I’m being very serious. Yeah. Might actually be really good methods for securing keys on something like noster, where the level of, yeah.

[00:41:39] Yeah. Would you agree with that? 

[00:41:40] NVK: The value prop is a little different, because the problem is a little different, right? Yeah. You’re trying to maintain access to your identity, right? if you leak your Bitcoin, it’s gone. You can’t just create the new one. Yeah. So it is different in that sense.

[00:41:56] Yeah. Right. So the solution will vary a little bit more and I think maybe social recovery might be a great solution for it, but there is more to this, right? there’s a lot more tech that can be built out because the primitives that it’s Sure. You can create more clever signing schemas that that will give you much better recoverability and resilience, but it takes time.

[00:42:22] Preston Pysh: Yeah. For people that are hearing this conversation, I think it is time for you to try it out. ’cause it is really different than what it was call it a year ago, or definitely two years ago on Noster. And obviously we’re very biased. We are advisors with Primal, but I think I. If you would download the app and try it out, I think you’re going to be really impressed with how simple, how you basically have a Bitcoin wallet right there embedded into the social network and your ability to just start up conversations and zap people with Bitcoin is like no other.

[00:42:54] NVK: I think the point there’s ability wise or like I cannot tell if I’m on Twitter or Primo anymore on my phone. I have to get confused. Same, and, and then we’re still in this phase of development. We’re trying to emulate the things we had before. Mm-hmm. Where I think things are going forward going to become more interesting where you’re doing things that were just not done before.

[00:43:15] I’m often looking for the Zap button on Twitter. Yeah. Yeah. But it pisses me off that I cannot send some stats to somebody on Twitter that said something funny or something useful to me. Yeah. So I think monetization is like noster with Bitcoin. It’s just so far ahead of what centralized systems can do 

[00:43:35] that.

[00:43:36] Preston Pysh: Like they just can’t compete. Yeah. I know when people share. An interview that I did, I almost always zap them a dollar or whatever, just because I appreciate them sharing the content, right? Like it’s a value add for me to have people out there sharing the content and spreading the things that I’m talking about.

[00:43:54] And I don’t know long term, I’m very bullish on this. I just don’t understand the timeline of adoption. And I just think that it’s, I don’t know, it’s hard to really wrap my head around, but really enjoyed hearing your comments on that. So people who don’t know who you are, you are one of the best hardware developers when it comes to Bitcoin hardware wallets on the planet.

[00:44:18] Tell people a little bit about cold card. Tell them if you have anything like roadmap wise, like what you see moving forward and where, how you see the space developing, or anything else that you really want to talk about with respect to. Thanks for that. 

[00:44:31] NVK: I think. Like a big difference between us and all the other, how There’s a lot of very good stuff out there.

[00:44:37] Like the space is developed quite a lot is that we are an independent Bitcoin only hardware company that’s been doing this for literally ever and, and we use bitcoin. I know it sounds crazy, but so many companies out there, they just have fiat people running the company and do those things.

[00:44:57] I think the reason why the products that we make are the way they are is because it’s well used for so long by, so people who actually use Bitcoin and we have the sort of like very clear, at least to us, path on how this thing plays out, right? We really think that. Just the proverbial grandma that’s going to use Bitcoin on chain is like idiotic to say the least, because there’s not enough SATs for everybody.

[00:45:25] Right, there’s only 2.1 quadrillion stats and there is 8 billion people in the world, and wealth distribution is a basis point now and may be a hundred times better. And that’s still 1%. And then when you break that down, there’s just not enough stats. So what happens then is that the majority of the people holding on chain Bitcoin.

[00:45:46] Are going to be people who chose personal responsibility, who chose to vary with a lot of agency to do this right, to have their metal plate stamp that seed down and want to pass that on to their kids and function in that sort of extreme self custody environment. Things are a lot easier now. you tap here, you scan that and transaction goes away.

[00:46:10] But the thinking is from this extreme perspective, it’s not different than like even people who have a lot of money and don’t believe in gold as a medium exchange. It still has a decent amount of gold in a vault stuff more. Like physical, right? And that is the perspective that like humans have had with all their money and stores of value throughout millennia, right?

[00:46:33] There’s the stuff that is trendy today. There is the stuff that is I need it in case of emergency. And then there is like the balance and between of that, right? So we built the products for the people who need to transact in a few different ways, right? But mostly focused on this sort of extremely self-sovereign.

[00:46:53] Self custody of that Bitcoin. They own that Bitcoin. They don’t leak privacy if they do it right, and it’s a much better place to be in. And if they can just sit this out, they will see a lot of returns on that Bitcoin, hopefully, right? That’s the plan. Now what happens is can my grandma use this? Yes.

[00:47:10] Like I’ve passed. It’s totally usable, but it’s not designed for grandma. And I think there’s a lot of distraction in the market because. When you choose to make something very secure, there will be trade off. Right. And I think those trade offs are necessary because again, if you have just a thousand bucks worth of Bitcoin, like just keep it on an app.

[00:47:31] There is a million apps that are amazing. Many of them are fully self-sovereign, whatever, but like you don’t need to buy stuff to store that.

[00:47:39] And you can progress. And like the point, I don’t have this sort of like paralysis where you don’t go and buy the bitcoin. and then slowly get it out of the exchange, learn how to do it and move it that way.

[00:47:52] But realistically, like we were talking about. The base layer not having transactions, right? Is that, the majority of the people are going to be on lightning, are going to be on layer three, layer fours, layer fives, whatever. Right. They’re not going to be storing Bitcoin in their firewall. That’s going to be a niche market.

[00:48:08] Yeah. That we hope to address it very well, but that is the main sort of difference there. 

[00:48:12] Preston Pysh: Do you try to cater to the institutions and how they’re going about the self custody as far as. Signing devices or is it much more retail based? I’m just curious on that. 

[00:48:23] NVK: So there are exchanges. They use our devices as part of their, what a compliment, by the way.

[00:48:28] Yeah. Forum of Multisig. Yeah. Our devices are well used by institutions using collaborative multisig. There is institutions who make it with just code card forums. There is a lot of large holders out there that use pass phrase with single sig. There is a place for everything. We don’t focus on people who need normally qualified custodians because their needs are of a legal nature, not of a technical nature.

[00:48:53] Yeah, that’s a great way to frame it. Yeah. Yeah. So even though there are some qualified custodians that do use some of our technology, the point is when say MicroStrategy like has. The requirements, the legal requirements on how that Bitcoin is held. They end up going to disqualified custodians or big name brands because they don’t want to get sued if there’s a problem.

[00:49:16] But, those are a hundred actors, maybe a thousand in a few years from now. But like it’s a very small, unique market. The vast majority of the money is in, say, family offices. So you know, they’re stuffing vaults in places with Swiss FRAs. They’re stuffing vaults with gold. They’re stuffing vault of con card.

[00:49:36] There is a lot of stuff out there that is just not as visible, but that’s where a lot of the money is. And what’s cool is that like you as a average person with some tens of thousands of dollars in savings in Bitcoin can store on that same cold card that people who store, I. Hundreds of millions of dollars due.

[00:49:54] That’s the beauty of the Bitcoin tech in general. We use technologies that are cross vendor independent, so like vendors can, any vendor, like if you take the seed out of a cold card, you can stick it in any other hot wallet and it’s going to work. There’s a beauty to that. You’re not vendor dependent. You don’t, if we disappear tomorrow, you’re still safe.

[00:50:12] Preston Pysh: And there’s a lot of those principles that are applied on how we develop our stuff. N vk, I could talk to you all day long because you’re such a wealth of knowledge when it comes to this stuff. What I appreciate the most is you’re able to frame it in a way that doesn’t have this bias one way or the other.

[00:50:26] You’re very middle of the road as far as just being able to lay out the strengths and the weaknesses of any side of these arguments, and I greatly appreciate that and I know the listener does as well. So thank you so much for making time to come on the show, give people a handoff or anything else that you want to highlight or promote.

[00:50:44] Let the audience know. 

[00:50:45] NVK: Well, thanks for that, Preston. I know I’m just another Bitcoin idiot, but I appreciate it. You’re our, you’re our idiot at case. That’s right. No, seriously, if people are interested in self custodying and having a solution that hopefully is handed over to their children, their grandchildren, and grand grandchildren, take a look at our stuff instead of ku kai.com.

[00:51:06] We make the cold card, we make the tap signer, we make a bunch of stuff. I have a million other projects. Select the Bitcoin treasuries and things like that. We have way too much fun in this space. 

[00:51:17] Preston Pysh: We do. thank you, sir. Such a pleasure and honor to have you and I look forward to the next chat.

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