The Plan to Put Bitcoin in Every Conversation | Seth For Privacy

0:02I think what people don't really understand is no matter how practically strong the protocol is, if someone has root-level access to your device, it doesn't matter. Because they can just get into whatever data exists for that app. So the core of what Radar is, is it's just fixing this idea of our money, at least money we actually control, like self-custodial money, Bitcoin, and our conversations, especially conversations where we actually have privacy by default, where we know that what we talk about is not being used to train AI models, It's not being used to profile us and figure out who we are.

0:31Those two things have never collided. We're in a place that is kind of hard to imagine how good the tools have gotten on the Bitcoin side. Like five years ago, if you had told me all the things we would have today and how simple and seamless they would be while still retaining self-custody, like I would not have believed you, honestly. Your conversations and your money should not have to live in totally separate places and be very disconnected and have to do this copy-paste shuffle. if you're coming to Radar because you're a Bitcoiner and that's the only people we draw in, we fail. The goal for us is really that this becomes something where people who don't care about Bitcoin and maybe even don't care about privacy are using Radar simply because the user experience of how getting into the platform, how sending and receiving money works, feels better than any competitor.

1:17Seth for privacy in Cleveland, man. How are you doing? I worked out nicely. have i doxed you there that we're in cleveland or are you okay for me to say we're in cleveland no i'm fine yeah this this street i don't know if it's just this street or if it's just cleveland i got in last night i've seen basically nothing here but it feels like we're in a horror movie that sounds like a relatively apt description of cleveland let's just say it's not my favorite place on earth like uh it's a place it's getting better but it's yeah it's it's not the best out there when i went down into the basement to put uh my drying on i wasn't sure i was going to come but how are you doing i am doing well i'm doing well it has been a man it's always busy you know you know how it is i mean you're you're not only doing all this all the time and like 100 podcasts a day but you're flying all over the world to do them same like events i mean i feel like april through june was just nuts events obviously we've had this huge push with radar on top of cake wallet all the things that we're doing there um yeah crazy busy you've been hitting the podcast circuit hard as well i have it has been fun like going back around the circuit like i feel like uh it kind of comes in waves so getting to do more about this talk through a lot more bitcoin privacy stuff talk through spark has been really enjoyable because i love this this is my favorite way to do podcasts because you get to do all the hard stuff yeah you come up with the questions you do all the production you do all the marketing and i just sit down in a chair and drink some water and talk are you still doing your podcast technically it exists uh it's probably been like a year plus since i've done one that counts as no yeah not really it's like one of those if i'm really inspired i'll uh i'll spin everything back up and do it again it is something i need to do more often i feel like 90 of my workflow now i could just automate and have claude do all of the other stuff outside of the actual recording um so i could probably do more than i have been but like it's made me so much more efficient like i do so much with ai i want to talk to you about ai but we'll do that a little later um we should talk about radar because this is so this is new it's obviously a new business from cake wallet but it's same team right it's you and vick and yeah started by the same team kind of just to get it off the ground leadership team is the same it's like vick's co-founder or co and founder uh i'm coo uh and then our same cto omar uh has come into the radar team but outside of that we're working on growing the team right now separately because it is it's a new business uh a new model venture capital is a first for us for vick and i so it's been fun figuring out that model and a good time getting to work with with ego death capital specifically um but yeah from from the same team is kind of the best way to phrase it because we could we got it off the ground and we'll drive it from a leadership perspective but getting new devs and marketing and all that right now so tell everyone what what radar is what have you built yeah it's been a blast it's it's this crazy thing where the actual concept is stupid simple like i feel like a lot of times you get on to like pitch a new project and it's you gotta you gotta go through like 10 years of history and the super complex problems it's solving and i think something that's really nice about radar is it's just solving something that seems trivial but it hasn't been done in the right way in a way that is truly freedom tech from both sides um so so the core what radar is is it's just fixing this idea of our money at least money we actually control like self-custodial money bitcoin and our conversations especially conversations where we actually have privacy by default where we know that what we talk about is not using being used to train ai models it's not being used to to profile us and figure out who we are um those two things have never collided like we've had signal we have simplex we have other really good messaging platforms right now, but none of them fixed the money side.

5:03And we obviously have fantastic tools for Bitcoin now. We're in a place that it's kind of hard to imagine how good the tools have gotten on the Bitcoin side. Like five years ago, if you had told me all the things we would have today and how simple and seamless they would be while still retaining self-custody, I would not have believed you, honestly, because I feel like the Bitcoin wallet space was pretty rough four or five years ago at this point. But the tools there have gotten so much better that we really just had a wake-up moment when we deployed Spark for Lightning and Cake Wallet. Our whole team, we're heavy signal users.

5:38All of our off-topic stuff is in Signal. Signal is our backup for all of our team conversations. If we have issues with Slack, it's all of my primary comms for the business dev side relationships in the space. So we've always been huge, huge signal users and advocates. but the ability to just send money in the place you're already chatting with people is something that is really incredible when you start to use it and the tools on bitcoin got good enough finally that we could do that in a way that didn't you didn't have to sacrifice self-custody to do it and you also didn't have to sacrifice like oh god this user experience is terrible yeah which has been the case for such a long time exactly exactly so it's really bringing those two things together where like your your your conversations and your money should not have to live in totally separate places and be very disconnected and have to do this copy paste shuffle you should just be able to if you're chatting about that meal that you just had last night with a friend and you need to pay them back why do you have to go to venmo or paypal and then oh what's your username what's your cash tag okay let me send that why do you have to go to phoenix wallet and make the payment from there and get an invoice from them first and hopefully it's the right one and your wallet supports it like get away from all of that complexity but still retain self-custody still retain pretty good privacy on the payment side obviously we can talk about that and do it in a way that's just stupid seamless.

6:53It's really good. Like I think that probably the closest we've had to that would be sort of zaps on Noster. Obviously a different use case that's like generally used as like a social media tool. Having that with inside something as private as Signal would be incredible. Like that's really, really cool. I use Signal for as much communication as I can. I try and get absolutely everything over there because it's like great privacy, but also it just works like all the other chats that you would use. So how are you using Signal? Yeah. So under the hood, I think the best way to explain it is that we're signal compatible, like radar works on the signal network so that you can still chat with all of your signal contacts and that anybody who comes over to radar, you can make payments as well.

7:35How does that work? So is the signal protocol open source and separate to like the signal app that you download on your phone? Yeah. So the signal protocol itself is open. The signal apps themselves are open source, specifically AGPL v3 for the open source license nerds out there. The actual network itself is run by Signal. So like they have their own servers, their own infrastructure, they run all of that. But the protocol itself is totally open source and the apps are as well, which is good. That's always how something like this should be, especially at a protocol level. It needs to be open source and run by foundations.

8:07I think Signal have done a good job with that. And so you could just bolt onto their network and build this on top of it. Yeah, yeah. It's one of the very nice things about how they built it is it is quite easy to build around. And something that we discovered really early on when we were building this was signal had launched this mobile coin cryptocurrency a while back it's like six years ago now they've tried to make everyone forget about it i think yeah it kind of doesn't exist anymore like it technically does um but the cool thing about it is because they built all that out they built out all this all these rails within the signal protocol and the apps themselves to be able to do payments obviously they're built around mobile coin but a crypto payment is a crypto payment we can we can use the same things for lightning or spark to spark payments specifically within radar so that made it also a lot easier because we didn't have to do something that wouldn't be compatible with broader the broader signal network we didn't have to do some custom side channel or something like that we were able to really ride those rails and do it easier than we expected honestly out of the gate because of that so i've got a question that this one is like a bit of a tricky one yeah i donate signal um like do the monthly subscription we just donate money because they have huge costs in terms of running their servers i think it's an awesome product like i'll give them as much money as they want like every time they come out with a new product i basically buy it even if i don't necessarily need it um so they did their chat backup recently subscribe to that how does this work because you're not paying the server cost like how does the relationship between you and signal work yeah so the the way that we've approached it is that that we understand a we are going to bring some user costs to them if people are using radar and it's using the underlying signal network um and b we understand the value of what they built like like i said like we are very hardcore signal users i've been pushing people to signal for uh almost a decade now all my friends and family are on there i understand the costs that come with that so the way we've approached it is that that we've already been donating to signal to make sure that we're far more than covering user costs uh and it's something that we're going to ramp up at the same time because we want to make sure that it's not just like we don't want it to be like net neutral like hey we're just barely going to cover costs and then you deal with everything else we understand that that they are doing so much more and that the foundation's ability especially to continue iterating the signal protocol and building the network as a whole is something that is really really important so we we kind of view it like we want it to be a rising tide that lifts all boats um so donations are core part of that but also users that get on radar are also getting on signal uh as a network work which is is a boon for them at the same time that's very cool um how do you make money so right now there's not a a built-in profit model into radar um obviously we have plans for that the the goal right now was just to get a really clean payments experience out we didn't want to complicate it with anything else at the moment um and the goal long term is always to keep it very simple and very clean like we're not cake while it lets you do a million things like silent payments page one b2 you can use spark on chain like there's so many different options for what you do in there we will not make radar that like very intentionally radar is supposed to be simple and intuitive and easy to use so we'll keep it like that uh in terms of profit model long term the simple one is just obviously if if you're not a bitcoiner already like we we envision radar being something where bitcoin native people are just the like the tier one audience like that's where we start that's obviously where we already have reach those are the people who are likely already using signal in some way yeah and they're using bitcoin so they can onboard by just sending in a lighting payment and they're done when we get past that tier one audience obviously we need people to be able to top up just like they would top up cash app venmo paypal whatever and so they'll be just sending dollars and stable coins and things like that yeah yeah so it'll be primarily topping up with dollars getting in that way obviously we'll take a small fee on that um And then stable coin support is something that we're already working on, already have kind of the bones of that in place behind the scenes to let people not only top up from other stable coins and just have it auto converted to stable coins on Spark, which is a really nice feature.

12:11And one of the reasons why we wanted to go with Spark specifically under the hood for this, but then also let people, if they need to, to make external payments to other stable coins on other chains at the same time. And then those swaps obviously will take a small fee on as well. So simple profit model in the short term obviously have some bigger plans on other ways that we can we can approach this on the long term as well it definitely makes sense to start with bitcoin is like when i speak to anyone if they're in bitcoin they probably have signal anyone else probably doesn't like it's getting better and i feel like yeah like i mean me personally i'm pushing everyone i know to use it because it's just where i want all my conversation to be and i want to install it and and see how it all works do it live just quickly before we do that though um can we talk about the tucker carlson signal telegram thing because that's one of the the few when i do talk to normal people about trying to get them on signal and stuff that is still a hangover i think i thought it was hacked yeah exactly people saying that the security model and signal is not actually as good as people think it is um and then offering telegram as a solution is insane which isn't even encrypted chat by default um can first tell a story so everyone knows what happened there and then let's get into the details of it if you hold bitcoin long enough there's going to come a time when you need some dollars it might be a tax bill a business expense life getting in the way but whatever it is it might come at a time when you don't want to sell your bitcoin that's where leden comes in leden lets you borrow against your bitcoin instead with tiered rates that go as low as 9.25 percent so you don't have to sell your stack if you don't want to leden have operated through every market cycle since 2018 and have originated over 11 billion dollars in loans.

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16:31has been a heavy signal user as most people in high profile potentially targeted environments are like signals first adopters were really that that type of user and it's branched out far beyond that um i thought it was funny the other day i was listening to like a basketball podcast that i like and they were talking about that they should move their group chat over to signal because they were they were talking about things that they didn't want in the public about basketball players like i just thought that was like funny i think we're kind of through the only hardcore people use it idea well that's as chat gets completely cracked down upon by states all over the world yeah yeah that helps push people for sure um but yeah so tucker carlson really heavy user he was using it for all of the people who wanted to be like whistleblowers that sort of thing they're reaching out to on sick to him on signal and it came out that some of his chats had been revealed some info about what he'd been chatting about had been revealed i think this was around the time of the putin interview is that right i think so yeah it was like right after that that he broke this story that about what had happened but i think the the common confusion is always that people assume what data was leaked was the source of the leak and they tie those things together always and that's almost never the case i mean if you look at like he was using signal on ios specifically if you are a high profile journalist and you're using any sort of device you need to assume that you are actively trying to be compromised hopefully he was using lockdown mode on his iPhone.

17:53I wouldn't be surprised if he wasn't. And he was targeted by something like Pegasus, where they did an OS level attack, some iMessage zero day or something like that, got access to his device. And then I think what people don't really understand is no matter how practically strong the protocol is, if someone has root level access to your device, it doesn't matter. Because they can just get into whatever data exists for that app. Whenever you open the app, they can screenshot the screen as you go, even if they can't exfiltrate the data specifically. so it's i think it's overwhelmingly likely that that's what happened and they had an os level breach of his device and they were able to get those chats from there the other alternative is things we've seen like the u.s government where they add the wrong person to a chat and yeah that person leaks the info and it's like if you add someone who's not good into your chats it is end and encrypted but one of the ends is that person who maybe is not trustworthy they can screenshot the app they can exfiltrate whatever they want from the chats that they're in that's another possibility but i think an os level attack is most likely there's there is absolutely no evidence that there is a breach of signals protocol in any way and it's very cutting edge very like complex from how it provides privacy but extremely well vetted from how the protocol itself actually works um and no reason to think that there actually was a compromise but obviously it's a much better story to talk about signal compromise than oh i was just one of thousands of journalists this year that got hit with pegasus or something like that that just breached my i did a long interview with jsr about pegasus and it seems like the most obvious like possible thing it's probably the most controversial interview in a decade with one of the most controversial people in the world like to think that they're not trying to infiltrate your phone and get information like of course of course they are and what about the desktop side though because there were desktop security issues with signal not that long ago yeah it's it's interesting like you you have to treat the desktop apps a little bit differently obviously they're using the same internet encrypted protocol a lot of what people think about security is that desktops are more secure and safe and mobile devices are less secure and safe because you do so much on your mobile phone and maybe you don't on your desktop i think a lot of people have a false sense of security on their desktop while the opposite is definitely true like yes we just talked about attacks on ios pegasus but those are nation state level undisclosed incredibly complex zero days that they would never use on a regular person yeah your desktop being pwned is something that happens to regular people all the time because desktop os is outside of mac os mac os is probably the only exception to that are much much easier to uh to attack and hack into that's why i I think Signal have made a good decision in that the desktop apps themselves are much simpler.

20:42And they're really just a relay for messages. Like the way that they work under the hood is they're just a linked device with your Signal or Radar app. And they just pass messages back and forth. And you can send messages from them, but they work a little bit differently. But you do need to, if the actual info in the messages that you're sending is that critical, that you need to make sure that a device breach on your desktop does not reveal that information, then it would probably be best just not to use the desktop apps at that point they're really just a convenience thing too like you can't use just the desktop app anyways you have to use the mobile app and link it to the desktop app so again if you're a very high profile actor you should be using something like ios in lockdown mode with signal only on that one device and don't link it to any other devices but they really are like the the more edge cases um yeah because was the problem that they were keeping chats in sort of plain text format on your desktop Yeah, it was the way that they actually store the database behind the scenes.

21:37Normally you would think of vulnerabilities or something like that being, if I have the app open and someone has a hack into my device that I have malware or something like that, then they have access to what I've been chatting about. Or they can screenshot it as I go, or they can key log and see what I type out or what I copy and paste, that sort of thing. But yeah, the main issue was, and I'm a little fuzzy on the details because it was quite quite a long time ago was the actual database, even when the app was closed, was something that other apps could read easier than they were supposed to.

22:07That has been resolved as of a long time ago. I think that's probably a year plus since they resolved that at least. But it was one of those downsides. I will give them a little bit of a break as well though in that the ability to securely store data on desktop apps is quite poor. You essentially have to always roll your own and do it yourself. Whereas if you're using something on iOS or Android, there's really good native tooling to use the secure enclaves that mobile phones have that desktops and laptops generally don't have access to. And so actual secure data storage on mobile OS is much easier and essentially built in.

22:45Whereas on desktop, you have to roll your own and you have to make sure that you do it in a very careful, very cautious way. We run into the same thing with CakeWallet where we can't rely on the desktop level security in any way. So even if there is something like a secure on clay we can't build around just that because what about a user who's using a 10 year old laptop that doesn't have that you have to take very different assumptions when you're talking about desktop level security than mobile security so will you guys not be doing a desktop app uh the plan is definitely specifically obviously for radar yeah yeah the plan is definitely to do one i mean the the low hanging fruit is mac os um like technically we could ship that right now we want to polish it a bit more uh just make the the ui a little bit better but mac os is the easiest one.

23:28The nice thing right now that we realized is like it again, because we're compatible with the signal network and protocol, you can link radar with the signal desktop apps. So just for the messaging side, you can use that right now. Yeah, that works totally out of the gate. Like I've been using radar behind the scenes for at least six months now, all linked to the signal desktop app, which is where I do a lot of the chatting because obviously when I'm working, I'm using signal a lot for work um so that works right now so you don't we don't like have to ship something but obviously the downside is signals desktop apps don't support payments at all um so we would like for users to be able to have that full functionality directly from the desktop and not have to go to their phone to actually send or receive a payment got you i've got some feature requests for you so i've got i'm on radar now i just sent you 10 000 sats i mean it it looks very very similar to signal uh obviously slightly different but very cool um two you said 10 000 it's only a thousand me oh sorry short short i'll send you another 9 000 now um i was trying to do a podcast at the same time to be fair um so some of the things that i do use on signal like i use the chat backup um this is we have like a group chat with my family where all the baby pictures go yeah um they're important pictures so i don't want to lose those um can does my backup on signal still work if i'm using radar it does yeah um yeah i mean for clarity so we we're using the open source mobile apps ag built agpl v3 like i mentioned before and modifying them to add in payments so we've we've kept as much as we can the same for now uh of the rest of the mobile app so it does still work with their encrypted backups it works best with their cloud backups the thing that they've been rolling out over the last year roughly yeah um that you can pay for you don't have to pay for i think a lot of people are a little confused about that one as well but yeah i'll pay them it's like two dollars yeah it's worth everything yeah exactly so i do recommend paying for it the difference is i think the free plan you get like 45 days of data and chat backups uh and the paid plan it's unlimited so you'll get all of your chat history back immediately um but yeah those are fully compatible obviously we worked really hard to make sure that we kept up with compatibility there so when you go and you actually install radar you'll have like a migrate to signal option you choose that you'd say i have a backup and then we'll be able to see that backup ask for your recovery key which is what decrypts it you'll enter that and then all your chats will be back exactly as they were before obviously with the limitation of if you chose the free plan you'll only have the last 45 days if you if you're doing the paid plan you'll have all of it the one caveat that we've noticed is for some reason they lock down the paid backups for like making paid backups to their actual app id so we can't offer you paying signal for backups in radar which is a little frustrating because like we wanted to keep that monetization method for them yeah like we don't want to take that money like the goal was to keep that if you ever hit donate or support or anything within radar it's all going to signal like we have no interest in that we want to make sure people are still supporting signal the underlying foundation um but you can't sign up for and pay for paid backups in radar because they've locked it down to their app id but you can still restore paid backups in radar and you can use the free backups at the same time um within radar so that that still works very cool so my feature request that you can't do in signal and this is most likely a privacy thing i would imagine but i would really like it is the ability to automatically download like to my photos folder from certain groups like i definitely don't want it for everything but like when i talk about that like the baby pictures in that in my family group like i would love them just to automatically download to my photos can we add that yeah yeah i mean definitely could do that i hadn't thought about that but that would be good for us too because like the the only privacy or freedom tech thing i've been able to convert my family to is signal so like all of my family chats are all in signal one of my favorite things we've done is we basically replaced social media which used to be like how my parents would keep up with us and we'd keep up with my parents and like all of that would happen on Facebook and I got off Facebook six seven years ago at this point deleted it and totally done with it and finally got everybody migrated over so it's really cool because we have a family chat that like is what social media should be like we talk about what we're doing we share pictures but it's just our family and it's not like me posting what I'm doing so my family will see it and then like the world can see it for some reason like that it never made any sense are like here's a baby picture and like your mom likes it and comments on it like what what world are we living in like why is this not directly happening um so that is that feature would be awesome there too because that's that's pretty much how how our family does everything as well like all the baby pictures pictures of like my kids cousins and all that are happening in there so that'd be nice to be able to have that i'll wait for that one to drop then doing it live i'm doing it live so maybe a better example for what you're trying to do here with radar would be like x money because they're obviously i think they've made their chats end to end encrypted i think it's not open source so we don't really know what's happening there but now they're bringing x money along kind of trying to do what you're doing essentially with radar but on keeping everyone on platform and x and they're also doing things like i think they're offering six percent on cash deposits which i don't know how they're doing now seems pretty high um but like how do you compete against a company like that because network effect is obviously huge there yeah i mean it definitely it definitely will be tricky because you end up having a similar problem to like how does bitcoin compete with paypal which obviously has been like the conversation for 15 years now yeah and the reality is that like unless a huge a user is either ideologically driven or forcibly removed from the legacy financial system they're probably not gonna switch to something that is more self-sovereign unless it is better in some other clear critical way yeah um and i think like an example of that would be as x seems to get more and more regulated and starts to implement more and more id requirements and starts to i mean them doing x money i think is going to continue to push them into having to actually identify users who especially if you want to do x money and you you will have to give up your ID.

29:40Like it's, it's a bank. Um, I think that will push a lot of people out just purely because of the friction that comes with that. Yes. Once you're in that system, I think the ability, like you'll, you'll be able to, I'm sure tip people's tweets and all of that stuff that's going to come later on. That will be nice. But if you have to do all the KYC friction just to get into the system and use it, I think that friction will push people to something like radar. But I think the, the reality is the onus is on us as builders to make it where it's, it's an actually better experience. Like if you're coming to Radar because you're a Bitcoiner and that's the only people we draw in, we fail.

30:13Like quite honestly, yes, it will still be a good tool. But the goal for us is really that this becomes something where people who don't care about Bitcoin and maybe even don't care about privacy are using Radar simply because the user experience of how getting into the platform, how sending and receiving money works, feels better than any competitor and i think the the vision has already been laid out by how incredibly well signal have done with that where absolutely the vast majority of their users i would argue have no interest in user privacy and have no clue what the protocol is they don't know anything about that they just use it because it's a really good user experience do you think it is the best example of freedom tech reaching sort of the broad world yeah yeah i think it's undeniable i mean you could you could obviously argue that bitcoin is but i would expect there are many orders of magnitude more signal users than there are self-custodial bitcoin users who use it for payments regularly at least um yeah i think it is the best example because they just they they made decisions that were really controversial like keeping the phone number requirement because they understood that the thing that they needed to build was not the most hardcore solution possible it was not the maybe maybe poor phrasing but it wasn't the most freedom tech freedom tech that they could build like that would be a simplex or something but you see how successful signal been because they've kept it very simple yeah yeah and like they've obviously they've taken a lot of crap for keeping phone number requirement in for other choices that they've made over the years for how the foundation is run and yet they've been sustainable they've built something that has a lot of users that don't care about the underlying ideology or concept and it's because of that like that ability to decide where is compromise actually beneficial to the end goal and where do we stop the compromise is really really important like i something that stuck with me is uh um francis from bull bitcoin oh i'm bringing up bull bitcoin so much on this one but francis from bull bitcoin did a presentation i think two years ago at btc prog and it was basically about this idea of like when we're building bitcoin services and tools how do we know what to compromise on and how far we can go and he had this really, really interesting chart to me that talked about how like the user experience, you can compromise up to a certain point and then you can keep compromising and get better user experience, but you'll lose all of the freedom that comes with it.

32:31But there is this little bit that we have to be willing to figure out what can we compromise on and not be in this mindset of it has to be the most hardcore, most technically superior tool. We need a bike shed until we get to the most perfect solution, but rather like what's the thing that we can do to make this work and like the phone number requirement for instance it's in signal it seems terrible until you actually think through and you start figuring out how are we going to address spam within a protocol like this how are we going to address malicious users and no one else has solved that i think there are some interesting ways we can solve that and bitcoin is honestly the best solution for that especially now that bitcoin lightning is so approachable you can do spam prevention with micro payments which is something that we've been digging into just in case um but But that is a really good example of that.

33:19And I think they're by far the best solution. The best example of freedom tech that has kind of gone more mainstream is the one I always bring up at the same time. Yeah. And I totally agree that if it's just Bitcoin, it's like, it's not done enough. Like, we need this to get broader. Why do you think the companies like X haven't looked, or maybe they haven't looked at it, but haven't implemented anything with Bitcoin in terms of, especially if like, if the goal of X money or part of the goal of X money is to have tipping on tweets and stuff, which I think it is, is to build that like circular economy sort of thing.

33:46like i'm sure elon's looked at nostor and i think he probably has because of jack um sure and he must see that as like a huge revenue option like if he's taking a small percentage of every you know tweet like that's a lot of money yeah why not just use bitcoin why go through the rigmarole of doing x money i think the biggest reason over the years has just been that if you actually like if you just wanted to do custodial bitcoin obviously they could they could do that that's just as easy for them as x money maybe easier it depends on how you look at it on there from their perspective but if you wanted to do self-custodial payments in a way that was not like extremely painful for users on bitcoin i just don't think that was really possible until about six months ago until spark really until spark and now arcade and second are there as well um there's some caveats there in terms of user experience but they can you can paper over a lot of those and i think it was that like we had kept thinking about lightning as like we're just going to iterate on top of the way that the tech works as a whole and we'll get to the point where it's good enough and thankfully finally we like the community said like we we have to shift perspectives what's another way that we can do this and work around the pain points that are coming with lightning so i think part of the problem is like if you talk about x money i'm sure this has been in the works for years yeah since he took over probably maybe even before that who knows if that was a thing that was already in the works before he even took over x and when you're talking about that like they're not going to work on something for three years or whatever and then a new technology built around bitcoin comes out they're not going to ship that yeah like there's no way so i think that is the biggest problem has been that there was just no real way for them to do a user-friendly self custodial bitcoin approach that would have been something that they would have wanted to ship to their users until very recently but that was the the huge breakthrough for us was like we were approaching 2 million users in cake wallet now uh we're well over half a million lightning users at this point from what we can tell the only visibility we have is just how many lightning usernames people have created custom ones um and like my lightning ptsd i was terrified of what that launch was gonna look like uh and spark obviously has other trade-offs which we can get into if you want but still to me ticks the box of self-custody unilateral exit things that are really important for that.

36:08And it was just incredibly smooth compared to what everything else has always been when you talk about deploying Lightning. And you talk about being able to do micropayments, stable coins as well on Bitcoin using Spark. And that was just a wake up moment of like, we've actually gotten there finally. We've talked about that we're there, but we only really had like one wallet that was user-friendly that could do Lightning and even it had a ton drawbacks phoenix um and so that shift i think will will now enable people to build things like x money even when they're not ideologically bitcoiners but because of the ux that can bring but it's going to be sort of a long tail because if you're building something like that for a platform with however many users x has at this point you're not going to implement some cutting edge tech on bitcoin you're going to weigh it until it's very very proven but that means that people thinking now about how are we going to do payments and we want to do them in a way that is a little bit more self-sovereign.

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38:41You wouldn't reuse a Bitcoin address, so why does your phone broadcast the same identifier for life? Every SIM has a static ID and carriers, ad networks and bad actors all use it to track you. The big carriers have been caught selling that data over and over again. cape is america's privacy first mobile carrier their identifier rotation feature changes your id every 24 hours so you look like a different subscriber every single day and sim swaps are off the table your number can't move without a 24 word phrase that only you hold there's also no name at sign up no social security number and there's no profile to build on you if you're a bitcoiner in america i honestly don't know why you'd use any other network you can head over to cape.co forward slash wbd and use the code wbd for 33 % off your first six months that's c-a-p-e dot co forward slash wbd so when you talk about the you said the trade-offs of phoenix that's like liquidity requirements and all that kind of stuff yeah mainly that inbound liquidity requirement and the the way that offline payments works okay the two main hurdles i think that we've seen so you're using spark on the back end to do all of this um let's talk about spark a little bit because um how are you using it and then let's get into the trade-offs of using it yeah i mean really simple again the theme of radar is simplicity under the hood all of the payments are spark to spark payments so if you let's say you top up initially by sending in a light and payment that's being atomically swapped from lightning to a leaf which is essentially the utxo of spark and you hold your balance on spark within radar so obviously we use the terminology lightning i know it's not technically accurate but it's the best way to describe it to the broader bitcoin audience yeah and then we're more specific about spark and docs and when we talk about it on podcasts and stuff like that for the people who actually know what spark is um so yeah everything inbound and outbound if you're making a lightning payment or receiving lightning payment that's happening happening via atomic swaps with spark and then every payment within radar is actually just spark to spark we could technically do lightning but then you'd be just be going spark lightning back to spark just spending extra fees and making it take longer and there was just absolutely no reason to do that so yeah everything within is spark to spark so does that mean that you can do both on chain payments and lightning to fund the wallet yeah yeah you can the the really nice thing with spark and arc is that you can onboard and off board directly from on chain if you want.

41:10And it actually provides in Spark specifically, well, in ARK as well, it provides the best trust trade-offs if you are onboarding from layer one directly, because it means that you're the one who will get into the trade-offs more there, but it gives you a better set of trust trade-offs if you do deposit from layer one. And you can always withdraw to layer one at the same time. And there's no fee around that either, other than obviously the on-chain fee that you have to pay for the transaction um and that's a really nice point there i think it it's definitely going to be rare that that's used because if you're the tier one audience like you're already a bitcoiner you're probably already using lightning it's easiest to just top up from lightning um but it's obviously something we want to want to support especially if you're like you won't you're using radar a ton and your friends have all paid you back and you need some you need some cash you can withdraw to l1 to coinbase or whatever and uh and sell it so you're seth for privacy not seth for ux um what are the privacy trade-offs of spark because i i know these are self like technically self-custodial wallets but what can they see in the background like how can they attract payments like how does that work yeah so the the easiest way to describe sparks privacy is really to view it as like a a vpn provider model where you're gaining good privacy from outside observers no no one else even your counterparty can see other transactions that you've made within the ARC within the Spark ecosystem.

42:34There's no block explorer. No one can look you up and see the transactions that you've made. If you send or receive a lightning payment, there's no way for them to know who the underlying user is. They would just see that it's going to Spark's LSP and they would know nothing else. So it provides very good privacy from outside observers as long as Spark do not reveal transaction information. So because it's that VPN provider model, you're trusting them not to reveal that info. They are logging that info. They need to keep state. So just like Bitcoin, everything goes on a blockchain within Spark, everything has state within the Spark system.

43:07So all of the Spark operators are keeping that state. So they know everything about transactions. They're just choosing not to reveal that. And that's something that we waited to deploy Spark and Cake until that was an option. Because at first, like Wallet of Satoshi launched with Spark. And for some reason, they chose not to hide any of that information. So everybody's transactions got published to a block explorer for Spark. And your Spark address was embedded in all of your lightning invoices so you would reveal everything about yourself every time you received a lightning payment not great yeah not not great and not the way it needed to be that was a poor choice on their part i've no idea why they chose that um but now well satoshi had fixed that and cake we waited to deploy until we could do that in the that vpn provider model and then radar obviously we adopted the same thing so that's the most important distinction is the spark operators see everything about transactions obviously they don't know your id they don't know anything about that you're even using it within radar they just know that it's a spark payment uh and they certainly don't know anything about who you're paying within radar like you paid me spark themselves have literally no clue that that that was between me and you or that was even radar related which i think is a really important piece here is the the kind of the separation of visibility throughout radar is really good where no one entity has access to all of the things that are happening with payments and messages and network connections.

44:27So why did you pick this rather than like cashew or something, which obviously doesn't have the benefit of being self-custodial, but it has the privacy benefit. Yeah. I mean, it's, it's a really good, really good question. And it's something that I've been kind of like battling with of which is more important. And it's frustrating that we have to choose. Do I want near perfect privacy that e-cash as a whole can bring? or do i want self-custody and okay privacy which something like spark can bring or even like a yeah but still would be in the e-cash custodial like yes it's a better custodian because at least it's not a single custodian it's certainly a better solution um but that is the it's really frustrating that we have to make that choice i'm i'm certainly hoping we get to a place where we don't have to make that choice like even within spark there are ways that uh light spark the people who are designing it can can build it with blind signing so that they actually wouldn't know anything about transactions um and we've been pushing them really hard to do that they are going to bring some more privacy tech like shielded amounts uh on transfers at the very least but there are ways we could get there for me the the biggest piece of why it needed to be self-custodial over being perfectly private is just the the sustainability and longevity of something like this i imagine as an american company you probably couldn't run the cashew mint as well you'd have to trust someone else to do that yeah i mean theoretically we could but it would be dangerous like you don't want to be that one especially when you're talking we're not talking like a vibe-coded cashew wallet that's going to ship to 100 people like the goal here is tens of millions of users yeah which means very high profile when you talk about like like there was this whole bitcoin for signal campaign like uh i remember 12 months ago yeah really interesting really well done cali kicked that off he's been the the main guy behind cashew the single custodian approach to e-cash uh and even like jack dorsey and tons of others are getting on getting in on trying to push signal to adopt bitcoin but the thing that i raised immediately when that campaign went live was the the goal of the campaign was to get them to adopt cashew e-cash within signal but practically what that would mean would be that signal would become a custodian for all of their users funds and signal already have by far the highest profile target on their back of any freedom tech provider right now like if you're building freedom tech signal are the ones facing the most headwinds constantly battling politicians and battling regulators and having to deal with so much stuff that comes with just being a privacy preserving chat app like just that is enough if you also add in oh now you're also a custodian so you're a money services broker like you're way too much risk there's just no way they would ever want to do that so if they didn't want to do that then how who are they going to choose to be the custodian for all their users because if that person rug pulls or just has an issue and users lose all their money signals reputation goes down so like the the core issue for that was it was just never going to be sustainable at at their scale, even though the privacy is fantastic.

47:40So I'm hoping someday we get to a place where we can do something that is still self-custodial like Spark, but has at least much better privacy. Like we'll never get e-cash levels of privacy because you necessarily can't. The way that e-cash works, you can never do completely in something like Spark, but you could get close to it and get, I think, good enough privacy, which would be a fantastic development. Is there a weird thing here where your success could almost mean the end of your business in some ways like because if signal watch what you do you you get a load of users people using bitcoin on there a lot they could just implement the same thing yeah is that a win depends on if you're asking me or if you're asking rbc investors i don't know like for me the the ideologue part of me would count that as a win yeah for sure like i'm not in this for the money like the thing that i love about being able to work at cake and being able to work at radar is like we're actually able to build cutting edge freedom tech and ship it to a lot of users and that is just invigorating to me to build something that's really being used and if we could push like give them incentive and motivation to ship bitcoin payments that are self-custodial within signal i would be happy with that like i would definitely see it as a way yeah i mean to me that would be a huge win if 150 million monthly active users woke up one day and they saw hey do you want to use bitcoin payments and one tap enable it and top up from debit card like that that would be a win in my opinion in terms of human freedom which is more important to me than the companies i'm building honestly um which i probably shouldn't say as someone who's building companies i think you should i think they could be happy that you said yeah it's it's yeah that would be a win for me obviously it would be frustrating because of all the time that we've spent building it but what better way to to drive a company to do something that i think they need to do anyways than by proving out the model itself.

49:28So it would be a win. It would be sad for some reasons, but overall, yeah, that'd be awesome. It's a win for humanity. So you're using Spark. The other big question around Spark that I see people talking about a lot is the unilateral exit. Like it's obviously available, but I've seen people having issues with it and finding it hard. I've never tried. I don't know how it even works. So how is that a problem that we have? Yeah, so there's, there's a broader issue that people need to understand about unilateral exit in any of these systems, Spark or ARK. And then there's a specific one for Spark.

50:02So I think the first one to raise is the most important one where unilateral exit simply means that you can exit without anyone's permission. It does not mean that you exiting on chain will be economically viable. In all of these systems, it will always be drastically more expensive to unilaterally exit than it would be to naturally withdraw because you're having to submit massive amounts of transactions just to get back single utxos single leafs from spark like an example i saw and i'm probably going to misquote the number but someone exiting from spark to get like 18 leafs back had to make 90 transactions on chain because you're having to unroll the whole tree of how these leaves are stacked on top of each other and the chain of how they've been spent between users and so it gets very expensive it is possible and like even for that example basically his findings were some of his leaves there was just it would cost more to exit them than to just give up on them yeah so a lot of the decision making and how the process works has to happen behind the scenes on the the designers side the app builder side to figure out what is actually worth exiting and what's not but that is always a caveat with any of these systems the same is true of arc Spark is more expensive in the way that it's built to unilaterally exit, but it's definitely possible.

51:24That being said, even if it's more expensive, it has to be possible because obviously if you, especially if you put larger amounts into there and the Spark operators wake up one day and just decide, I don't want to do this anymore, or they have an issue and all of them get deleted, or a nation state comes after them and shuts them down, you obviously need to get your money back. And that's where this is very important. The specific caveat with Spark right now is you can do it but you have to do it via a cli app like you have to go into the cli import your seed it downloads the state that you need to be able to do that from one of the spark operators so in practice it's not really unilateral exit yet i'll just be completely honest it's the ability to exit as long as any of the spark operators are up and there's three of them right now that's okay obviously that's not ideal we were supposed to have full unilateral exit months ago and it's just It's very complex in both Spark and Arc.

52:14So they've been working on it. We're probably, I'm going to say the meme because it's actually the right amount of time. We're probably two weeks out from proper unilateral exit that actually keeps all of the state that you need, that doesn't rely on any Spark operator to get the information you need, and also does all those calculations about what can I exit, what can't I exit to maximize the amount I get out rather than to maximize the amount of leaves I get out. I just want to maximize the amount of sats I get out. So that will be coming. so it's not in radar right now just like it's not in kqla right now but you can do it through the cli app with that one one caveat at the moment so is it fair enough to say that it's it's okay for now it needs to get a lot better yeah i would yeah even okay for now feels like maybe a little bit too generous like obviously it's not the way that i want it to be and not the way it should be but it just is the reality right now and i think it for the for the most likely solution which would be that some spark operator has a problem unless the systems can't send payments but you still want exit which is the most common or the most possible one right now it's it's fine for now but certainly needs to get better we've been pushing really hard on spark and breeze to to ship that and like i said they are actually getting really close we're watching the prs right now a lot of the building blocks are already in place so is um is spark like your final destination with this is this what the bitcoin payments will always look like on radar obviously it depends i mean like we've always been willing and able to implement cutting edge tech in in cake and now in radar so like obviously we're open to shifting to something else um i've been very closely monitoring both arc implementations for a long time um like we were initially going to ship arcade in cake and then once i actually did a really deep dive into arc versus spark it became clear to me that just spark is the better more probiotic solution right now for the average user but that could change i think the the one specific way that that would change would be that if we got covenants in bitcoin which i don't think is ever going to happen unfortunately but if we did let's just say in this this mythical anything again in bitcoin yeah i don't think i don't think we are uh there's a reason i don't really bother talking about them that much but if we got covenants they would essentially solve all of the the remaining ux hurdles that exist in arc and would make it where arc is just the better solution because you'd have slightly better trust trade offs with the same UX where right now in reality, Spark has slightly better trust trade-offs than ARK does with a better UX as well.

54:43But that would flip if we got covenants and we're able to do the things that ARK needs in a little bit cleaner of a way. So always open to that. And one of the beautiful things about this is it's Bitcoin under the hood. So if we woke up one day and ARK was clearly the better solution or whatever the next thing is, is a better solution. we could build that out and migrate our users by just sending a lightning payment from their old wallet to their new wallet and done like there's there is no there's no vendor lock-in in any way there's not even layer two lock-in in reality because you can always get out you know lateral exit you can always exit on chain if they're still online or you can just make a lightning payment and migrate users balance with their consent of course very cool i i'm definitely going to use this i'll uh i'll be your bug checker i'll see if we find anything please bring me in my new features as well that'd be awesome yes um let's talk a little bit more about sort of bitcoin privacy and chip coin privacy yeah um zcash has had a lot of hype so i i was saying to you before we started this show i i really struggle i don't really pay any attention to other spaces like i just don't have the time but i obviously saw like the silicon valley pushed for zcash over the last 12 months or however long it's been yeah can you just fill me in like everything that's happened like i i know that the the vcs have been pushing this hard i know that there was then a floor in zcash that was found like what's happened oh man yeah i quite honestly i thought zcash was kind of like done i did too i thought i did too we had moved on like the world had simplified we just understood like you have your bitcoin you have your stable coins you have your monero like we're we're good guys we're good and then yeah they were resurrected and suddenly every influencer and meme coiner on the planet woke up one day and loved zcash yep um and started talking about it completely organically of course yeah completely organically just stumbled upon it again after 10 years and discovered this new newfangled project it wasn't in some pump and dump group chat there's no way yeah there was no there was definitely no coordinated paid uh kol campaign going on behind the scenes um that honestly that was the kickstart of it like i don't know what it was that drove like why suddenly there was a desire from zcash companies because there's not really that big of a zcash community there is one but they're not that huge it's really the companies behind them gemini um the zcash actual company um it's it's those players that are the ones that have been driving this and it seems like they just decided let's try one more time and see if we can revive zcash uh and they're they're the pump at least worked so far price went up it's it stayed up relative to where it was before that was really interesting to see everything that i can see behind the scenes was that it was just absolutely a paid marketing campaign.