Is Bitcoin Culture Dead? | Pete Rizzo

36:15Okay, like what's the, you're asking like, what's the bear case for like the treasuries movement? Like what's the worst possible outcome? The worst possible outcome is like you end up with, you know, hundreds of companies distributed around the world where investors have kind of like put dollars in. The companies have bought Bitcoin. The companies are all sort of stagnant, insolvent. They all go bust, whatever. They sell their coins and then nothing really happens. you're sort of back at square one right so that's that's the bear case so like let's just like let's actually run your scenario to the end because like that's how you would actually see whether scenarios are good so let's just pretend all the bitcoin treasury companies don't outperform bitcoin they all suffer catastrophic losses they all sell their bitcoin and they all go to go to zero with the exception of like strategy uh what happens like uh bitcoin movement will like move on and like figure out some different way to like scale and like try to become mainstream and like further bitcoin as a technology movement um i can say why i think that bear case is unlikely um i think it's unlikely for a number of reasons i think it's like one there's there's there's actually like regulatory and tax like issues like in each jurisdiction where these treasury company models it's likely for them to accumulate a lot of bitcoin and then if you can imagine the future it's like, well, you can build a financial services company by just owning a lot of Bitcoin or just like have a company that just endures.

37:42You know, so from the 2021 era, like Tahini's is a great example. Tahini's is a Bitcoin treasuries company. I'm talking about like the shawarma place from Canada. They save in Bitcoin, they've expanded and they're growing. Are they a Bitcoin treasury company? Not in the kind of modern sense where these companies are trying to kind of exploit the financial system to like inflate their, you know, overall balance sheets um but again like ask yourself like what do you think then about how business how the business world works in a bitcoin standard and how bullish are you on bitcoin because like okay so your bull case for bitcoin then is a world where no companies own like what's your what becomes your case it's definitely not that um it's like i think tahini's is a great example of a like so i've been getting a load of shit on twitter today i was just telling you about it before the show.

38:30What's your case for corporate adoption in a hyper Bitcoinized world then? This is the point. I have been pretty skeptical about Bitcoin treasury companies. Again, it's really hard to even bucket them together because the question is, okay, you believe in hyper Bitcoinization, correct? Let me get there. My point is, I think strategy are doing interesting stuff. I think the Prefers have launched really interesting. I think there's a market, a huge market demand for that. I think they'll be absolutely fine. And when it gets to the smaller Bitcoin companies that are trying to do the treasury play, like issue debt by Bitcoin, I think that's rapidly becoming less interesting.

39:08And the things that I am bullish on are like positive cash flow companies putting excess reserves into Bitcoin. And this is why I did the investment into Bhodl, because they're not just going to issue a ton of debt and buy as much Bitcoin as possible. They're actually trying. They've put Bitcoin on the balance sheet. They're going to try and put that Bitcoin to work and yield on like running lightning nodes. we'll see how well that plays out but it's a bitcoin business not just like a pure cash grab issue debt by bitcoin yeah so i think the thing here becomes like okay like in a in a world where bitcoin is like fairly mainstream it's like how much of the business is denominated in bitcoin and so you get into like weird asymmetries right now where it's like um from the bitcoin treasury company's perspective they would rather pay their employees in dollars so they can accrue more bitcoin because they would they think that it's better to play employees in dollars and then use that that use the bitcoin they have to like accrue it and accrue more bitcoin so the idea here is like if you have a public company a company where there is a an equity that people have purchase if it's going to underperform bitcoin and it's a bitcoin company why would you hold it that's that's essentially the question this is how they've derived this idea that they need to outperform Bitcoin because in a world where you are put it, why?

40:23So you have bought, yes, you, you have bought Bitcoin, like treasure shares in this company, but for the company to keep going, it has to accrue more investors over time. That's what a company is. Otherwise it dies. So like there has to be some reason for other people along this curve to then buy the, the shares later. If it was better for you to have bought Bitcoin when you invested in that company, then invested in that company, then you lost money and you made a bad trade like your which is very possible you could have traded those australian dollars for uh i'm assuming australian australian dollars for bitcoin at a certain rate and you got less bitcoin as a result and so the interesting thing with strategy is like strategy outperformed bitcoin like you put a dollar in and you got more bitcoin than you could have bought this is like this is one of the things about the movement that i know a lot of the 2021 and Bitcoiners blanch at, which is this idea that like you give the company capital and it creates more Bitcoin for you than you could have bought.

41:22It's like a weird thing to think about. But again, it gets to the kind of point where it's like, okay, like, let's just imagine that like, let's just get rid of the specifics. Let's just say that this whole movement right now, what it's trying to ask is how will businesses operate in a Bitcoin world? How will publicly traded Bitcoin businesses operate in a world that moves towards a future where Bitcoin is money for everyone. And so if you agree that Bitcoin is going to be money for everyone, then businesses have to adapt to that. Then what this movement is doing is aligned with our mission, because essentially what it's trying to do is answer this question.

42:01That doesn't guarantee that all of its ideas are good and 100 % going to be correct, but it's directionally moving us in a positive forward direction, because it is grappling with questions that there is no known answer to. So we can't possibly know how this will happen. All we can do is build and kind of iterate in a certain direction and that will reach some sort of conclusion at some point or it won't, right? I mean, who knows, right? So like it'll have or and then the culture will go in some other direction. But like I think it's pretty obvious that like we would want to have a conversation about how businesses are structured, how they're capitalized and how they perform like on a Bitcoin standard and that these companies, even if they're doing things that are raising money in bad ways, that'll make sense or they're treating investors badly or they're promising things.

42:49Like these are all things that are actually happening. There are companies that have raised money and then probably ways that they regret. There's companies that have underperformed Bitcoin and there's companies that are currently worth less than, you know, they've promised. Like this is, so, you know, I think more transparency and more discussion around that is good because that's the forward direction. Like, that's what people are arguing about. That's the serious current conversation that's happening. And so, like, my instinct is just like, okay, let's dive into that. So, like, you know, Bitcoin Treasury is like the emails, the social media, like, whatever, like, that's what we're talking about.

43:20Like, let's have a conversation about that. It's very clear that like, you know, sometimes you just have to experiment in the right direction. Right. 2021, we experimented in all sorts of new directions. Right. Podcasts, books, like all these things were like were new, like they didn't exist. Right. And so they were efforts by the culture to achieve a wider adoption. And now there's, you know, we're past peak podcasts. Was podcasting a mistake? Like, should we, like, we think Bitcoin podcasting was a mistake? It looks like it moved the culture forward, right? And it adapted Bitcoin to the culture of the times.

43:55It moved Bitcoin forward. It's still useful for the people in the industry, but we're probably past peak Bitcoin podcast. I think peak Bitcoin podcasting could be ahead of us still. I think when these treasury companies blow up, we're going to have a real boost in Bitcoin podcasting. But a few questions on that. One is like which business models will survive? because i wonder if the idea of just sort of diluting shareholders to buy more bitcoin issuing debt like it would be nice if like i think one of the things would be nice to see though it would be more more models right so like you know uh you know whether it's like you know what bhodl is doing or like companies that are going to buy and acquire other operating companies um yeah you're going to see a proliferation of other types of models and some of them will work you know this treasury companies that invest in other treasury companies like as a model where you know number of people are coming to market with similar things there and it's like um again it's like the bitcoin culture is very good at like taking an idea and then just like driving it to its conclusion through you know mass speculation and that's what we've done the whole thing is just a somebody gets a good idea it's like save it and writes a good book and so there's a thousand thousand fucking books you know it's like one person does one thing and you iterate on it and you push it to the extreme.

45:16And so like Michael Saylor did this thing and it's like, oh, now there's a thousand companies going to do that. You got to run into the end. And so, yeah, I don't, you know, I don't think you have to know where the Bitcoin treasuries movement is going. I just think you have to analyze it as like a sociological phenomenon, which is like, okay, what are these people trying to achieve? Like, what do they believe? And are they aligned with the movement? I don't, I think the argument that they would be not aligned with Bitcoin culture is pretty weak Because again, it's like if you assume that the Bitcoin is going to be money, then businesses have to adapt to that.

45:46And so this is just the culture that's working on that problem. And at the widest view, like that's currently what's happening. And I don't see that as antithetical to Bitcoin. Yes, some of their cultural norms, you know, we've talked about this a lot when we talked about the ordinals and different stuff there. It's like some of their cultural norms are different than the previous Bitcoin monoculture. But I think what you're going to witness is that this treasury company culture, that's going to become the new Bitcoin monoculture. And Bitcoin monocultures are pretty short-lived, right? There's different versions of it at different times.

46:20And I get it. Yeah, it's like, you know, if you haven't seen many of them, it's hard to know, like, how different they were. And, like, I think each of them contributed to something, right? Like, I would say, like, you know, with the knots and core thing, this is almost like a referendum on the 2017, like, development culture, where it's, you know, the normative view in 2017 was that fees were going to be high, blocks were going to be full, and Bitcoin was going to scale in layers. and that, you know, the rules that we set post-Segwit of, you know, developing a pricing structure for data that was embedded in transactions that was consistent and fair and, you know, developing sort of policies that, like, you know, the developers thought would ensure Bitcoin, you know, continued in a centralized manner.

47:05Like, that's kind of being chipped at. So, like, you know, you always have different versions of the Bitcoin culture that are trying different things. The culture right now is pretty fractured. You have a lot of smaller factions than we had before. There's the Knotts camp, which I think is trying to like take us towards some sort of, I don't know what they're doing, but they're trying to like, you know, they imagine a very engaged user within technical development. And they ultimately are, you know, putting a message to the Bitcoin community that like we are failing potentially by not. But, you know, they're a culture, right?

47:42Like they're trying to compete to be a monoculture. They want to be a monoculture, right? Because they're aspiring. Monoculture is really growing as well. Like the number of comments I get under every video now talking of like asking me to talk about knots and corn is insane. What's your take on that? Because loads of people have been asking me to cover it. I did have Mechanic on the show and I had Shinobi on the show maybe, I don't know, four or five months ago. I've actually tried to have them on the show again together to debate. But the kind of discourse is broken down to the point where they won't talk to each other anymore.

48:13They won't do it. Yeah, I think within Bitcoin culture, the side that waves the doomsday flag is usually the side that has the weaker intellectual position. And I think on the not side, it's like they've been very quick to signal that they think Bitcoin will fail if people don't go along with what they want. And that's usually a sign that they just don't have a very strong position. I don't look I've been you know I was pretty one of the reasons I tried to put forth a positivistic argument for ordinals and runes and like sort of meta protocol development on Bitcoin is that I didn't want there to be a fork like within Bitcoin like I thought that would have been the worst case scenario I think the knots you know group will eventually fork whether it's the current people in it or a new set of people or some other group leading it that's sort of what happened in the fork boys right it wasn't Mike Hearn and Gavin Andreessen that forked it was Jihan Wu and Roger.

49:07Did all mix. No, not Roger. You know, it was the later people, right? And so, because ultimately what the Knots group is saying is like what is happening on Bitcoin like can't have ever happened or Bitcoin will fail. They're actually saying that things that are currently occurring on Bitcoin should not happen and they want to they ultimately have the most intolerant view They're saying Bitcoin can only succeed if we do follow this direction. And so they have the most narrow, intolerant view of how Bitcoin could grow and expand. And because they ultimately object to things that are currently happening that can't be stopped by anyone, and their whole kind of emphasis is on stopping this thing, they will eventually take some means to stop it.

49:54And I think that they will eventually have to do that through some sort of extreme technical means because, you know, the core developers, I think, have laid out a pretty convincing technical thesis. Like, it's, you know, we have to be tolerant of different uses of Bitcoin. We have to be tolerant of people doing things that you don't want them to do with Bitcoin in order to have a system where the rules are better for everyone. And I think the Knott's vision were like, I don't know, I just I find their whole worldview very problematic. It's like they want to start this sort of coalition to discourage some users from transacting, and they think that this is good.

50:29And I don't understand why I've asked them hundreds of questions about it. Whatever their specific technical proclivities are, I understand that they don't like, yes, it's like, okay, like, we don't want the Bitcoin blockchain to become too large. Great, we have a block size. Okay, you want to relay, like, you don't want to relay some of these transactions? Great, don't relay them. They're going to get into blocks. so like you know the most charitable view I think is that like it is great within Bitcoin that you can have a dissenting piece of software so it is great that we can have two softwares and we can have one that most people run and we can have a software that some people run who don't like what's currently going on a problem with that on the technical side though is there's very few instances of that happening within Bitcoin so you know one of the reasons that if you go back to Satoshi, Satoshi was very against like multiple implementations of Bitcoin The core developers have largely inherited this.

51:23And the reason that core is the dominant implementation of Bitcoin is largely because there's a fear of there being multiple implementations. Okay, so NOTS is like a more benign version of that. It relies heavily on the core culture. But eventually, like NOTS, if it goes down its road, will have to have a separate implementation and a separate team. Like, we'll have to do that. There's just not a react. Because, like, again, it's like the farther you go in the fork, it's like these people will keep updating their software and they'll have to keep updating. And so you're maintaining these two kind of, you know, forces in parallel, which is incredibly costly and takes a lot of time.

51:54And so, like, you know, there's only one real instance of, like, a small dissenting economy, like, where people didn't run kind of the majority of forks. And we don't know that much about it or how long it lasted or how much, you know, they transacted or anything like that. That's something I actually, like, argued that the core developers should look into, that they didn't, they never really liked that idea. But if the Nats people are interested in looking into it, it's called The Real Bitcoin. and it was released by Mershia Popescu. It's supposedly still used by some of his former economy participants in Costa Rica.

52:25But we don't know how long these things can last. And so there's just a cost to continuing this that I think will build up. So yeah, the Steelman, I think, it's good to have dissenting softwares. This is an interesting technical experiment, I guess. But I don't ultimately find the Nantes group to be doing anything terribly interesting because ultimately they feel like they're at war with this sort of, you know, post-Fork War world where, you know, why do we have arbitrary data in the Bitcoin? Well, because Bitcoin's data, and we want to have a script and data, like in Bitcoin in some cases. And, you know, yes, you can discourage these things, and yes, we can build a culture around discouraging things, but you're building a bunch of tools that, like, I think could probably be used against people using transactions that you want to make.

53:11And again, it's like, it's so at odds with the data. like the stuff's been around for two years it's like the blocks aren't full it's like the sets are like like fortnose has come and gone you know it's like it's it came and had its time like people who were there got into bitcoin through it hopefully they are they bought some bitcoin but like what's like there's nothing like it's you know they remind me of the big blockers because again it's like they have a very intolerant view it's like bitcoin must succeed one way i'm like there's the only we must do this and if we don't do this as a fail a failure um and that's just a huge red flag.

53:44And then this other idea where it's like, you know, you know, they say they just want to not relay these things, but that's not really what they really just don't want them happening. It's a class thing. It's like the other thing. These people are bad. They're, you know, and we don't want them here. They want to be able to kind of use their software to discourage people and, you know, make their transactions more difficult. So, like, you know, It's hard for me to see why that would inspire the whole Bitcoin culture to rally behind that. That's a very crass message. It's like, okay, we're going to build a positivistic version of the future of Bitcoin by encouraging people to discourage other users from using Bitcoin in ways that we don't like.

54:27And look, the Nots thing, it's like, sure, now it's fine. Like you can run nots and look, as long as you're not saying crazy things about, you know, how Bitcoin, you know, it'll be illegal to run a node if you run, you know, like very like non-technical things that are just like not, you don't, why would you introduce, like you're introducing attack vectors, like against Bitcoin and claiming that the people doing these transactions are, but like, no, you are doing that. Like you're the one talking about this and like you're introducing this to Acris. So I don't know. I think the knots probes, it's like great that they're running a node.

55:06Descenting softwares are cool. But like this descending software just for me, it doesn't offer like a particularly like compelling vision. I don't know. I've talked to Chris Guida and I like I like Mechanic and Luke and I hope they don't. I hope they sincerely don't believe that Bitcoin is going to fail. It doesn't feel like Bitcoin is failing to me. this is where I have an issue it's the extremes that the argument's being taken to where it's like Core30 is going to destroy Bitcoin which I just clearly don't think is true I do see fault on both sides I think Core, even if they're technically correct had a real issue with how they communicated what they were doing and the way they went about it I don't have a responsibility to communicate anything to you they don't work for you I totally understand they don't have a responsibility they don't work for me but I think there's some level of responsibility to like the Bitcoin world, even if it's not an explicit responsibility.

55:58And then on the other side, like I don't care if people are running OTS, like run whatever implementation you want. I think that's cool. I also think people are understating the kind of threat of running an implementation that's maintained just by Luke. And Luke's done amazing things. And like, if we can get more people working on OTS, I think that's interesting. And then the other one is like, I think it would be more interesting if the dissenting software was something like Libitcoin, which is like a ground up new implementation. But that's that goes off to deep end a little bit. Yeah, you have the consensus risk that like was kind of introduced originally.

56:30So yeah, I mean, like, you know, the right conversations I think to have about are about, okay, is Bitcoin going to a world with multiple implications? And like, is there a net new thing that reduces the risk? To me, I don't, there's not a net new thing here that reduces the risk of that. So then is there a compelling reason to do that? In which case, like, you would have to kind of, again, and accept the sort of argument from the the knots group that like something overwhelmingly negative is happening with bitcoin like my ability to use bitcoin hasn't been has not been impacted over the last two years and has not degraded or deteriorated at all i would category reject almost any argument that would suggest that that is the case because i i could i can't fathom like unless in like 2024 when walks are full it's like okay you paid an extra fee but that again that that is by design like how bitcoin's supposed to function like one of the great tricks of ordinals is that ordinals was a, you know, sort of the kind of genius of it was that it was a thing that was, it wasn't what Bitcoin was designed for, but it like it met the rule set.

57:28Like it followed the rules of the thing, of the protocol. They're going to kill me for that one. But like, you know, it followed the, it followed like the, okay, this is how transactions are priced. This is how like competing transactions would be, you know, compete for block space. This is how a block space calmly mature. And the developers want to build that because they're biased towards getting us to a place where if in the future blocks need to be full, Bitcoin functions as a technology in a market in a specific way. And so the argument that I always found was most compelling for Ordinals and Runes was that it pushes Bitcoin closer to that path.

58:08And so I think the only question is like, okay, well, why don't you see any benefit in modeling that? Because again, it's like The block size is 4 megabytes. No matter what people are putting in, they can't extend the block size. You, by running the software, agree to the consensus, which is that you agree to store up to 4 megabytes worth of data per block. That is what the consensus rules are. And we are currently adding less than 4 megabytes worth of data per block, pretty inarguably. So in which case is your expectation as a user? As a user, you're running a node, but you have to follow the rules.

58:42The job of the node is to enforce the rules of the network. So like, it's pretty obvious that like, we're not adding the maximum amount of theoretical data to Bitcoin that we could be doing, nor with ordinals or any sort of exploit is that occurring. And so like, you know, some of the people they'll say, Oh, well, the demand, you know, that they both they both think that like, Oh, God, this is like such a long road. But it's like, they think that like, they simultaneously think that like crypto assets, like Ethereum and all these things are worthless, but that the demand for them is so great that they'll destroy Bitcoin.

59:14and so it's like a literally it's like you can't argue the loop because it's just a it's just it doesn't make sense it's like they're like oh well ethereum's like worthless but if ethereum comes to bitcoin it'll destroy bitcoin well why would it destroy bitcoin well because there's so much demand for like all these like all these assets and all this arbitrary data i was like you just said there's no demand for arbitrary data so like ethereum's not going to work so look what why where's the demand for ethereum and they're like oh well it'll come to bitcoin and they'll they'll be the demand there's always demand for shit coins and it's like okay well then if there's always demand for shit coins then wouldn't you want to build bitcoin in a way that it accommodates that such the those transactions like can take place in a you know non-disruptible and as minimally disruptive way as possible it's like no we like must repel them and they must go elsewhere and it's like okay so you want shit coins to like continue like no we don't want shit coins to continue shit coins are going to go to zero they're a distraction like okay so like what do you want like you know it's like i i almost like the the knots people it's like they're disingenuous arguers because they they set up these arguments but they don't actually believe what they're arguing they actually want something else they want these transactions to not be possible and to have never existed and since i can't give them that like and no human being can give them that they will ultimately be very unsatisfied and like they won't be able to achieve that and so it's hard to know how to interface with that group uh i hope that they don't take extreme measures in the face of that and do something that would disrupt bitcoin's narrative publicly or threaten like the use of the software for everyone else because literally their claim is that what these people are doing is disrupting the software and if they find themselves in a situation where like they have to potentially disrupt the use of bitcoin for everyone to make that point that just it's a little close my mind i don't i don't understand to defend the nost people like to a degree like i do ideologically understand where they're coming from and and somewhat agree with them and the problem that because i assume you would call them sort of the monetary maximalists um and and that is what i want to see bitcoin for but i also understand that it's not up to me what bitcoin is bitcoin just is and all of these transactions are following the consensus rules um and but the one area that i do think there may be overlooking is the idea that they don't want to see things like bitvm and citria and all these roll-ups and layer twos um i think they maybe discount the monetary transactions that may actually happen on on these other layers and the fact that that could be a huge step up in terms of people's ability to get bitcoin in close to self-custody at least with a unilateral exit the much more interesting conversation we have if the knots folks wanted to have it would be uh that uh they don't believe that the fee market like will function in the future where blocks will be full uh so i wrote a piece for Forbes in 2022 called Bitcoin After 2140, where I started to kind of see that there were these weird sort of divisions between things that I think are sort of manifesting, where it's like, the developers are operating on a premise that blocks will be full, the fee market will be competitive, and thus we need to scale in layers.

1:02:17Post the fork wars, that was the status quo. It was the status quo because bigger blocks, the road towards bigger blocks was a world where a fee market never developed and blocks were never full so the the fork in the road there was like okay big blocks no fee market blocks are never full block space always cheap user onboarding always cheap small blocks blocks are always full these are always competitive this is best for bitcoin in the long term because it maximally ensures bitcoin success even in adversarial conditions the fork was over the the big blockers thought that they could remove adversarial conditions for Bitcoin by Bitcoin being popular.

1:02:56Thus, they wanted Bitcoin to be free. Thus, they wanted to be widely used. Thus, they wanted to get regulatory acceptance through that. The small blockers said the best thing for Bitcoin is for it to be maximally adversarial, for it to be able to succeed in conditions even when it's under threat by all sorts of authoritarian governments. Therefore, blocks should be small. Bitcoin should be maximally centralized. Therefore, fees should be high. This is how we solve potentially if there's an issue post-subsidy of how Bitcoin continues in the future. This is how we solve that issue. I've been calling this the post-Fork War consensus.

1:03:26If you think of the post-World War II consensus, what was the post-World War II consensus? It was that the US dollar runs the monetary system of the world. Everyone saves in the dollar. The post-Fork War's consensus was that this was how Bitcoin was supposed to operate. In which case, Segwit introduced the pricing mechanism for data on the chain, which is why we have block weight. And so, if really what you're arguing, really, is that you don't think that there is a fee market that needs to develop, and that you don't think that there needs to be the system for how Bitcoin doesn't need to go down that technical path, then that's fine.

1:04:06you're just sort of, I think, chipping out. You're just sort of, you're actually on a referendum on something else. Like, it's like what you're talking about is just something completely different, where you're trying to change, like, how Bitcoin should operate, or, like, how, like, the normative view on how developers think Bitcoin should operate. Like, core developers don't think that ruins and ordinals are an overwhelming concern. The data would prove that I think that they were correct, that there wasn't a reason to be overly concerned about them. the burden of proof should be on the knots camp to to prove by some means that that has become sufficiently disruptive for someone to you know it's again so like again they want some action about this they want this demand that they have to be satisfied um but the closest articulation i can get to their demand is that they want the ability to be disruptive of other users and to other users from, you know, certain types of transactions.

1:04:58And the seemingly the correct, the response of the developers is, okay, well, these transactions look like other transactions that we might in the future want. So we will not do that, because that doesn't actually make Bitcoin better in the long term. And so that's the disagreement. So to your point, it's like, yes, some of the L2s, if you have a close of a Citroën transaction, it will look very similar to a ordinal transaction. And so therefore, the software, you know, and the eyes of developers, like, should accommodate that type of transaction. You know, I almost feel like the Notts folks, like, I would be more sympathetic to them if they just presented, like, we have an alternative thesis for how Bitcoin should work.

1:05:41Like, here's actually how the economics of Bitcoin should work. And, like, just be honest about that. You want something else because I just find it so unsatisfying. It's like, you really, really don't want to relay people's transactions that are going to block anyway? Really? Like, that's your concern. You don't want to relay them? I don't know. Like, I don't even notice relaying transactions. I have a node at home, like, relaying transactions. Like, who, like, it's not an active thing. It's not like you have to go to the door and, like, open it, like, let people in. It's like this major inconvenience.

1:06:07You're just relaying transactions. Like, what are you talking about? Like, what? Okay, so you have to update your node, like, more quickly. It's like, nobody told, like, nobody guaranteed you that your node was supposed to last a certain amount of time. Like, what are you, like, you agreed to store up to four megabytes. separate that's the that's the note that's the that's the system like what are you talking about like what so where is the where are you being like so inconvenienced here uh you know and it's like okay well if you want to scrub that stuff off you want to get it off your computer your note it seems like you can do that i haven't done it myself but it seems like people are saying that that's that's possible um so this would lead me to to be suspicious of their claims because i just it's hard for me to fathom that that many that many people are upset about this like how are that many people upset about this so i so i don't think the knots group is like homogenous like i don't think they actually believe the same things because it would be extraordinary to me that they believe that it would be extraordinary to me to believe that there's so many people who care so minutely about the operation of like their node that's like sits on their desk like wherever such that they're like so concerned like about this particular thing, which again, I've, I as a user of Bitcoin sincerely, like sincerely to the Nazis have not noticed any change in like the past five years.

1:07:23Like it works the same. I mean, but it clearly has captured the imagination of a lot of Bitcoin. It's like, I think the latest number of like nots knows was 28 % or something. I know that those numbers can be like cooked a little bit, but it's a significant number of people doing this. Do you think this is like the death of monoculture. Pardon? What do they want? That's my question. The death of what? Is this like the death of monoculture in Bitcoin? Do you think we are now completely divided into these different subcultures? Yeah, that's also possible, right? Maybe mainstreaming Bitcoin is Bitcoin becoming essentially adopted by all these subcultures.

1:07:59Again, I think that Nott's people, I'm just not 100 % convinced that they're a reasonable subculture just because I don't know what they want to achieve and if they can achieve it. you know if they can't achieve it like i don't know how interested i am in like the minutiae of it um so i don't know i think that like it would be nice for core version 30 to be released and then you know we can all just go and watch the bitcoin continues to operate and um yeah i don't know again i i think that um the monocultures uh i don't know i think the treasury thing really feels like it's the new monoculture it just it feels like that is what people are excited about are companies buying large amounts of bitcoin what they're excited about is going like you know a website and seeing like which companies own the most bitcoin and like how fast they're like you know uh going up that seems to have captured the imagination of most people the knots thing i think is um yeah it's it's tempting i think the trap of knots that i've always like really think i think the mental trap is that it's tempting to think that like you matter for Bitcoin.

1:08:59And what Knott's really offers is a compelling story to the average user who isn't a Michael Saylor that they really matter for Bitcoin and that their action is necessary for Bitcoin's continued survival. Like that's the story that's being sold. And in this particular instance, I just don't think that story is true. Like that's not a real thing that like you should be concerned about. And because that's not a real thing, I just can't sympathize with it. So yeah, I don't know. But I understand why you would want it to be true, right? Because there's a lot of people from the 2021 era who like made being a Bitcoin or their identity, and like their social identity, their cultural identity, like not being in the industry, like just being someone who owned Bitcoin.

1:09:48And yeah, 2021 was a great era. I love 2021. We were all on Twitter, everyone was sharing ideas it was truly a time where it felt like most people in the movement were equal and and that and that everyone was involved and it was the peak sort of grassroots bitcoin it was us against like the crypto institutions i get it i understand i under i was there i i i was there for that part of it i left the crypto industry and i joy i understand why you you wanted to achieve that and I was there with, you know. But like, you know, is it still true that like you individually, like, it's so tempting. It's like, I get it.

1:10:26You want to feel like you are important for Bitcoin because that's how the old culture sort of scaled, right? So I think this is sort of how we know it jumped to the other culture. It's like, this is the old culture breaking down. Like, why can't we scale to the Bitcoin culture being everybody part of the Bitcoin culture? Because everybody can't be part of the Bitcoin culture. If you go to a... This is the analogy I've been using for this. You go to an internet cafe in the 1990s. You're Danny. You have the internet show. Everybody watches your internet show. And, you know, we are all friends because we're on the internet.

1:11:04Well, because of Trump's election, every coffee house is going to have internet. There isn't an internet cafe anymore. You don't go to an internet cafe to use the internet. There is internet at every cafe. And so I don't go to a cafe. There is no internet cafe. And I think Knott's is sort of really what Knott's is, is like, it's the continuation of the internet cafe fable. It's this idea that you are still part of the movement and that you can still be culturally part of it. When really what's happening is the technology is scaling and it's going to become so ubiquitous that it is impossible for us to have that relationship with it anymore.

1:11:42you know the analogy that i've used it's like how many internet protocols are facilitating this conversation we're on riverside which is on the internet which is on you know it's going to be on your youtube with this show which is going to be on the website and what do you know of like the actual workings like of any of these technical protocols what do you know wi-fi what do i know of your wi-fi what do i know of your modem what do i know of this hotel's modem what do i know about whether this is on a LAN. I don't even know what a LAN, I barely know what a LAN is. So like, so what are you talking about?

1:12:19Like, what are you, well, sincerely, what are you talking about? Like, this is the future of Bitcoin is the progression of technology is that. It's getting people away from it. Sure, are there some people who are probably like somewhere helping us have this conversation, you know, in the bowels of the internet? I don't know. I can't conceive of who they are, but thank you I guess right thank you so yeah I don't know man I just find it really tough I just I get it I really under I feel like I understand what they're actually what you're actually upset about but it just there's no way for the technology to you know because it's like oh if we everybody runs knots and knots is bitcoin and then like we helped save bitcoin it's like okay yeah I get it I get it I get why you want that to happen but like maybe that's a you thing and like not a everyone in bitcoin thing To bring it back to the start, I mean, I think we could go around a circus on that.

1:13:12It's a really hard conversation because I feel like whoever we're talking about, we're obviously talking about the Nott's people here more specifically than the core people. They're going to be pissed off that we're having this conversation and not representing them in some way because they are so fervent in this mission. And I think some of that comes off the back of the fork walls as well. People are just like, hey, this is why we made the decision. Here's why we think it's a good idea. No, the core people definitely aren't. And this is why I've not been super desperate to cover it much, because it's just like, I don't see this as like mempool policy is not something I'm going to get crazy irate about.

1:13:44Like, I think it's fine if you want to run different limitations. But at the end of the day, I'm not that bothered about this. I don't think it's a threat to Bitcoin. Right. So I think like what I would like from Knott's is like, OK, like, can you provide us with some sort of positive, like, mystic vision for this? Like, you know, what's the you know, what's the right like give give me something here because I can't get behind. Slightly inconveniencing like the crypto people who I like actually want to use Bitcoin, like it's just not offering me anything, really. And so like I have no like give me some sort of, you know, steal me like why should I support your cause?

1:14:18well it's like you know kill it well you know you'll kill bitcoin if you don't i was like okay well you know it's like give me something else you know it's like give me uh okay well you know maybe core shouldn't have that much power and users should have other options cool raise the money build a developer team sustain it for a couple years um you know uh i bet i said this to like a reply on newt van holmes tweet but i was like you know it's like if you're happy with knots like why are you so unhappy? Like just be happy running nuts. If it was that great of an experience running nuts, then everyone would run nuts.

1:14:52Because like it would be so overwhelming. Your joy of like being a nuts runner would be like so overwhelming and like your benefits like would be so overwhelming that like people would, you know, like what a sailor's vision offers. Sailor's vision offers you the ability to be the banker and the CEO and for Bitcoin to be the bankers and the CEOs and for Bitcoin to revolutionize the financial system and to borrow into the annals of Wall Street and take it over from the inside. Like, it's a great vision. He's got it. He's got a great pitch. It's great. You know, it's big in scope. It's, like, wide.

1:15:21It's participatory. It offers, like, this idea that you can become, you know, you can further the Bitcoin movement but gain financially. So, like, what's the utopian vision of Knott's? Like, okay, well, we're all going to be obsessed with, like, who's using Bitcoin and we're all going to, like, fight about, like, who's using Bitcoin and we're going to like develop custom software to stop them if we don't like them. And it's like, or again, not stop, it's like slightly inconvenient then we'll raise their costs slightly such as that they can't use it. So I don't know. Yeah, it's unsatisfying. And I think like as Bitcoin users, like how we create these cultures is like ultimately like a call to action like has to be strong.

1:15:57Right. So I think I've outlined like, okay, what is Sailor's utopian vision? Like, why is it catching on? Like, why is it a big tent? Like and like, maybe less, we can run knots through that. It's like, why is not like somewhat limited? Well, it's like it just feels like it can't be the forward direction of the movement. It doesn't feel like Bitcoin scales down that path. It doesn't feel like Bitcoin gets any safer down that path to me for the reasons that you said, you know, we might find ourselves in a situation where like a single software with a single developer is sort of like calling most of the shots, which seems net worse than the current.

1:16:28Even if you hate bureaucracies and like large meritocracies deciding things, like it just seems like kind of net worse. um you know and so what's the what's the vision and and um yeah it's like okay best place scenario like yeah i don't know it's like some jpegs like aren't on the chain i don't know i was fine with the jpegs like i made my arguments about the jpeg that's actually one of the like interesting things about it though is that if you take this to the absolute extreme and you say okay tomorrow 99 of people are either running knots or running core like which do you think is the better outcome And I struggle to know how someone who is on the Knotts camp would think that's a better outcome.

1:17:07Like maybe they do. Maybe they have their reasons. But like having 99 % of the Knotts run by Knotts, which is maintained by one person. I know it's a four-court core, but there's like a lot of changes in there. Like that seems like an obviously worse outcome to me. Yeah, I think like an outcome where you lose the 10-year like meritocracy that has been craved around core. I think one of the last lessons of the four wars is how much effort it took into extending the Bitcoin development team into being as large as it was. And how the checks and balances that were enacted around this, where there's funding, there's different people working on different parts of the database.

1:17:44There's a whole kind of elaborate culture of review. And early in Bitcoin history, that's not a thing. In some cases, software was like, you look at old softworks that were released on a three-month timeline. And now it's like the level of review and the culture of the funding and how much the improvements have been. So ultimately, this is the other problematic part of the Knotts group is that ultimately really what they don't like is democratic meritocracies. This is why they have the memes about don't take the core vaccine. It cleverly plays into the 2021 era, like anti-COVID. It's like culture that was mainstreaming Bitcoin.

1:18:22So it's like, to me, it's like, I get where this comes from. It comes from users wanting to feel important. It comes from the these are the people who are left over from the anti vax kind of adopting Bitcoin culture movement who find that not speaks to them because it offers them a way to rebel against authority. But then the correct question is like, is that authority worth rebelling against? And if you rebel against it successfully, then what occurs? And so like, if you analyze that question, is this authority worth rebelling against? I don't think so, because in the 16 years of Bitcoin, there hasn't been anything better created than this, which is a large multi-stakeholder that like the meritocratic process where it's very hard to change Bitcoin.

1:19:05That was the whole point. And your antithesis of this, what you're offering in exchange, can only be at best a large meritocratic process in which it's very difficult to change Bitcoin run by different people. like that's your bull case is that you is that oh this is a large meritocratic process like run by the wrong people so we're gonna make a large meritocratic process like run by the right people and like oh that will be better and it's like well no like the thing is the good probably like this is the best case scenario for the for is that this is the best model uh you know maybe if there's two like large meritocratic processes like competing for bitcoin okay maybe that you me in there.

1:19:44Maybe that would be good. But then, you know, prove to me how you can solve the technical issues, which we know at the root here, is that if these things actually do progress to being separate implementations, like, they'll, you know, there are known risks with that. So, like, you know, solve the actual root problem. But no, they just want to supplant the other, you know, they don't, they're just interested in becoming the new large meritocratic culture. So, you know, I think that the challenge here is to sort of evaluate these things and run them to the end and sort of say like okay like well what what is the actual solution that you're offering here and it looks exactly identical to the same version so even if you disagreed with the core version you can just not upgrade and if i was on the not side i would just be desperately trying to get developers like getting eyeballs on the code um because you don't want this to be something where luke's just shipping code without like very good peer review and but let's move on from the not stuff um just to close out can we talk a bit about sailor's utopian vision so yeah because he has been very careful about what he said in terms of like bitcoin helping the us helping the us dollar being an ally in this sailor's obviously a very smart person do you think he believes that or do you think he's selling a narrative so bitcoin gets adopted as quickly as possible um i had some possible for me to know.

1:21:06I don't know Seller well enough to know to answer that question. The question I think that might be more interesting is, is that the prudent path for the Bitcoin movement, or is there another option available? And so, you know, right now it's like, let's just say we didn't want to be a participant in that. Well, there's a lot of other cryptocurrencies like in and around Washington, D.C. that like, you know, now have their own digital asset treasury movements. And, you know, from the perspective of the Trump family, don't seem all that different from Bitcoin in terms of, you know, their utility to the administration.

1:21:36So I don't know how to answer that, right? I don't know. I don't. I try to look at things. I do sometimes have strong reactions to things, but I try to look at things and sort of say like, OK, like just describe them before you have a feeling on it. Just describe them. Right. OK, so like Bitcoin is is mainstreaming now in the United States and it's happening along with the expansion of the dollar. I probably personally would have liked to see a world where other countries that have been excluded from the financial system, like, were not continued, didn't continue to live under sort of, you know, the repression under the dollar that Alex Ladstein and other people have written about pretty eloquently.

1:22:17I don't think I will get, so I'm not entitled to that. I don't think I will get that. And I don't think that that will kill Bitcoin. like that's just i will have to accept the reality where that most people wanted this outcome um and i don't think you know will bitcoin be any net worse i think the reality is the dollar is going to be a lot stronger for a lot longer um this is always my you know so i do think there's two things that i think that's interesting about that it's uh you know uh i don't know how much the people who are using the crypto ecosystem to advance the dollar really get bitcoin i don't really know what their incentive alignment is long term.

1:22:56I have a lot of questions about that. And then the question is, is the stablecoin movement so successful that they actually increase the strength of the dollar so much that it like breaks the models of the Bitcoin treasury companies? Because the Bitcoin treasury companies are sort of largely based on this idea that Bitcoin has a consistent compound annual growth rate. And because that compound annual growth rate can be calculated, you can make derivative financial instruments off of it. It's the whole thing. So if you're really looking for like one little jenga piece at the bottom uh i was talking to jeff walton about this but like you know maybe the hypothetical is you know the stablecoin industry is so broad because again like there's two ways to increase the price of the dollar it's like you either you know uh limit the supply or you increase demand right and so you could you it's theoretically possible that stablecoins could increase demand for us dollars so much such that the us dollar stops declining against Bitcoin.

1:23:49That's theoretically possible. And so the question is, like, do these dollar, do the dollar, pro-dollar faction groups, you know, are they so successful that they break some of these models? That's where you get that. That's where the, you know, if you really are looking for, like, a weak leg in the treasury movement, you know, maybe you see something like that, right? Because Saylor's whole thesis is predicated on Bitcoin continuing to go up over time at a consistent rate. You can't do financialization if that doesn't happen. But if you're biased towards hyper-biconization you would expect that to happen so i don't know man it's a it's a hard game i don't know i would find that a hard one to believe just in this like the idea that i'm sure demand for us dollars will go up but i'm sure supply of us dollars will go up faster like is my left curve take on that yeah that's a reasonable stance right but i'm i posit it because i think it's uh it's an outcome that people seem to not consider that seems possible because if you think that like okay well you know if you look at what's going on in um you know korea and and japan and uh russia and china how successful do you think their stable currencies are going to be in the crypto market and so the crypto market is 99 dollarized then that means that their economies are eventually going to wither and go to zero and that the u.s dollar will be the beneficiary of that um you know yeah yeah i mean i think that um yeah the that'll set up the scenario where you know bitcoin and the dollar are sort of the remaining ones and and like that is implies that the u.s dollar demand would increase like tremendously like a world like a world where like you know bitcoin was the sorry the u.s dollar was the was the only like remaining fiat currency like you would imagine that like demand for dollars would be astronomical.

1:25:36I think that's probably a likely scenario, but I think if they got that, they would also increase the supply to benefit themselves tremendously. Sure. I just posit it because I think it's a fun thought experiment, and I'm not 100 % convinced that it's impossible, and I'm not 100 % convinced that the participants who are pushing it don't think that it's possible. I think that they might think that it's a plausible outcome, and if they think it's a plausible outcome, I would be interested in that. But yeah, I don't know, man. It's... What's going on? You know, we always have so much to catch up on.

1:26:08Do you think the path to hyperbitcoinization then is first every country basically being a de facto on the US dollar? Well, CK always said hyperdollarization and then hyperbitcoinization. That's an old meme that I think has been lost in Bitcoin culture. So if I could put anything in anyone's ear, it's that I think CK was 100 % right about hyperdollarization before hyperbitcoinization. and that I think he's collecting, he was saying that in 2020. And I think that's probably a likely scenario just because again, like the administration is pushing this stuff so heavily. But yeah, TLDR, I think, right?

1:26:46We're living in a cultural change in Bitcoin. There's like a new movement and kind of a new monoculture. I think it's important to kind of analyze what it wants to achieve. I think that monoculture is like pretty aligned with like hyper Bitcoinization. I think I explained sort of like, you know why even in the worst case scenario i think what they're working on generally is like interesting and and it should you know should be of interest to the bitcoin movement the the knots and core stuff you know i i i think again i i i think that will go where it goes because i i don't know i i it's hard for me to like see that i don't see the bull case for that playing out uh i could be wrong i don't know maybe i'll start running knots but i i don't know um yeah Yeah, and then with the stablecoin stuff, right?

1:27:29Like, that's, yeah, that's the big concern, right? The ghost of Mark Goodwin. Yeah. I mean, that's one of my favorite books in Bitcoin. All right. Well, Rizzo, this has been, I always love talking to you, man. We should catch up again for Bitcoin's birthday. We can do some predictions for 2026. Yeah, it has to be sufficiently long enough for now, though, because, you know, it has to be long enough for things to be confusing. But, yeah, man, I don't know. I would encourage you to maybe off your 21, you know your 2021 cultural stodginess of uh you know it's sort of um there's nothing about bitcoin that's really changed just because there are other cultures that are doing new things with bitcoin like it doesn't doesn't really you know you know if they're successful that's great for you you own bitcoin like you know if they're unsuccessful then we're kind of back at square one no right yeah i mean that's true and like buying bitcoin whoever's buying bitcoin is cool but i just i i think it is important that people continue to push like the values that are very important to me about bitcoin yeah that's that that's a big question right like it's like is does the two these companies become so large that they compete for bitcoin demands but they have to buy bitcoin anyway so it's like their demand is sort of pegs it's like suggesting that like three percent fruit juice like you know competes with like 100 orange juice and it's like okay like kind of you know i'm less likely to buy a coconut because i can go buy a coconut water in like a case so i decreased the demand for raw coconuts how dare you yeah i mean somebody has to buy the coconuts and then you know process them into some sort of drink that i can buy right um yeah i mean we let because there's so much stuff in that we don't need to get back into it because the the the problem like with that analogy when it comes to the treasury companies is where are they holding the coconuts and they're just giving all the coconuts to coinbase and anchorage and all these other people um but rizzo we've covered it we might put them at the l2 on top of bitcoin that are yield bearing yeah well then there'll be another show um yeah right let's catch up for bitcoin's birthday january we'll do on january 9th just to uh yeah but um appreciate you man this has been fun okay man peace sorry for offending anyone who's running nuts uh we love you Stay with us.