VNPRC is the lead maintainer of the Hashpool project, which aims to make mining more accessible using the cashu ecash protocol. He also runs Triangle BitDevs, a technical bitcoin meetup based in North Carolina.
VNPRC on Nostr: https://primal.net/p/nprofile1qqsdxpfv503a2ga3ajqxw843hws9z7302ghpj4mcmjpa6qagmp9pwrs8222jg
Hashpools: https://hashpool.dev
Recent Hashpool Presentation: https://www.youtube.com/watch?app=desktop&v=F2p_V0svDTo&t=3h15m30s
EPISODE: 159
BLOCK: 896433
PRICE: 974 sats per dollar
Video: https://primal.net/e/nevent1qqs0a5xzmsevjav509ngl6accy3utclesqm4azqkyh6xwylphwyqves4z9yt5
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(00:00:00) Bill Miller IV on CNBC
(00:01:24) Happy Bitcoin Monday
(00:02:57) Triangle BitDevs
(00:07:25) The Importance of Local Bitcoin Communities
(00:11:05) Hashpools: A New Concept in Mining
(00:16:43) Challenges and Development of Hashpools
(00:25:02) EHash Tokens and Futures Market
(00:36:42) Project Timeline and Call for Contributors
(00:54:03) Technical Setup and User Experience
(00:56:12) Open Source Collaboration and Future Plans
(01:00:12) Reflections on BTC++ and Community Dynamics
[00:00:00]
Unknown:
Important things to keep in mind if you just look at Bitcoin, it doesn't matter. Right? Bitcoin doesn't care. It's back in the 6 figures with a lot of room to go. If you compare its primary functional use case, which is actually a check and a balance on the lack of accountability and fiat unit creation, we still have a long way to go. So gold is a 20,000,000,000,000 market cap. Bitcoin is still 2,000,000,000,000 despite functional superiority to gold. It's much harder to steal, much easier to store, much easier to instantly transport, and more importantly, you can actually audit it. So I don't know if you saw, but there's an estimate that said that auditing Fort Knox would take forty four thousand hours and approximately eighteen months to complete. I think it'd be a lot a lot nicer for the American people if they could just go to a handful of auditable, Bitcoin addresses on a Blockchain Explorer and see exactly where the American people's Bitcoin
[00:00:52] Unknown:
is.
[00:01:26] ODELL:
Happy Bitcoin Monday, freaks. It's your host, Odell, here for another civil dispatch, the interactive live show focused on actionable Bitcoin and Freedom Tech discussion. That intro clip was Bill Miller the fourth, who is the son of Bill Miller the third, infamous investor, who's very bullish on Bitcoin now, apparently. They have been for a little bit, but that was kind of a bullish clip, and that's why I highlighted it. As always, dispatch is funded by our audience. We have no ads or sponsors. We are powered by viewers like you. So thank you to all the freaks who continue to support the show with Bitcoin donations.
All the relevant links are at silldispatch.com. The two main ways to support is Zaps in our live Nostra enabled chat, which you can find at silldispatch.com/stream or through podcasting two point o apps like Fountain Podcasts. The largest app we received through Fountain Podcasts this week was from lean ad with 3,333 sets saying, yes. Bitcoin community is smart, nice, and helpful. Aristocracy pleb. I am newbie. Don't really know what that means. Thank you for your support. Appreciate it as always. I see we have two rider die freaks in the live chat already, both Gary and Rob Hamilton.
It's good to have you guys here. We have a great chat lined up today with VNPRC who runs TriangleBitDevs and has been very focused on hash pools recently. I think we'll be talking about both and maybe some other topics. How's it going, sir? Good to see you.
[00:03:15] Unknown:
It's great to be here.
[00:03:18] ODELL:
Thanks for having me. For starters, well, what's how did you come up with your NIM? What's the How did I backstory on VNPRC?
[00:03:29] Unknown:
It's a, it's a, just a combination of characters that's, like, not taken on any social media site.
[00:03:39] ODELL:
Okay. Is that really the it has nothing to do with the People's Republic Of China?
[00:03:46] Unknown:
No. It does not. But, I'm sure we could come up with some acronyms if we tried hard enough.
[00:03:52] ODELL:
I always I've at first, I kept getting confused and thinking it was VNRPC. And now I remember it by People's Republic Of China. Like, that's how I'm like, okay. I gotta get the tag right. But, anyway, here we are. Yeah. So I think let's just briefly talk about triangle bit devs. What are why why are you so because I grew up on bit devs in New York, the original bit devs. Why are you so focused on on running a local community of BitDevs?
[00:04:28] Unknown:
Well, local community is is what makes Bitcoin happen. I'm a grassroots. I always have a bottom up perspective of everything. I started MyBitDevs because we we've had a a social meetup in Raleigh forever. If you talk to Simple Steve, he'll tell you it's the oldest one in the world. Nobody has contested that claim, so it's sort of like be true. He wins by default. Must be true. But, I, at some point, I I mean, I don't know how far back you wanna go, but I've been a Bitcoiner for a long time. Eventually, at some point, I I decided to get serious. I got really fed up at work. This was during COVID. I got burnt out, quit my job, and, started going to conferences. My brother actually dragged me to conferences. I I don't really like to travel, but, it was worth it. And I went to TabConf, like, a month or two later. I knew I had in my mind an idea that I wanted to run a technical meetup because I'm a programmer. I'm a super geek. I like to geek out on the protocol super hard.
And, the the social meetup is fun, but you get to drink in beers. You get a little sloppy. I want a deep focused technical conversation. And I went to to TabConf, and I saw my first bit of there. I participated in a a session run by Jay. I think it was in 2021.
[00:05:53] ODELL:
The original blew my mind. Jay is the guy behind New York bit devs, the original bit devs.
[00:05:59] Unknown:
Exactly. Yes. And, it blew my mind. I was I was just blown away at all these deep technical topics that I'd never heard of. I hadn't really been paying attention to the mailing list or anything like that. But I've been studying Bitcoin for, I don't know, a decade at that point, maybe. And then I I I talked to Jay at a bar, like an after party, and I said, hey. I wanna run one. And he said, cool. We got a blog post. Just read this blog post that tells you everything you need to know. Next month, I started up, for SpitDevs, and I think that was in, December 2021, and I've just been going hard. And on the blog post, if you read it, it's just like, the hardest thing to do is find a location.
The most important thing is consistency. So I've been consistently hosting meetups, every month for over three years now. I did miss two because I traveled to other cities to host vid devs around conference times. So, but, yeah, it it it, it's a really it's a really great sort of forcing function because I have to compile this list of topics. I have to read about them and learn about them enough to explain them to someone else. And I've always believed that if you can't explain something in plain English, then you don't understand it. So I just try to go out and learn this stuff and explain it in plain English and, try to grow my local community so that we can have we can have a Bitcoin hub here in in the triangle.
[00:07:26] ODELL:
I love that. Yeah. We're very aligned on that, philosophy. As I said, I'd I grew up on New York, but devs, and then that was also part of the inspiration for Bitcoin Park and Rabbit Hole Recap and Soul Dispatch. It's easy to think like nothing's going on in Bitcoin. There's so much there's so much going on in Bitcoin. And, really, the only way, is to just get in way over your skis and just dive head first in. If you understand everything, you're probably not, focused enough is my opinion. But triangle bit devs, so anyone anyone who has a BitDevs near them has not been, should go. There's it's been amazing blossoming movement of BitDevs around the country and around the world.
If you don't have one near you, consider at least starting a social meetup. I think meetups are incredibly important. Maybe bit devs comes later. I think there's kind of an order of operations to it. We were very deliberate at Bitcoin Park. We started with the social meetup because I feel like it's a high it's a high bar to to run a run a good bit devs. The try it's called Triangle because it's Raleigh, Durham. What's the third city?
[00:08:44] Unknown:
Chapel Hill. So it's called the Research Triangle. There's there's three, universities here. There's probably an order of, popularity or notoriety. There's UNC. There's Duke. But those those orderings, I'll get it wrong because NC State is really the top university. Go Wolfpack. Those other guys, they're just hanging around.
[00:09:07] ODELL:
Do you get a lot of students? Or
[00:09:10] Unknown:
No. I wish I did. If you're out there listening to this and you're a student at NC State, please get in contact with me. We need a Bitcoin club. I've been, like, kinda prodding and looking for some some signs of life. We have the largest engineering college in the state. Fifteen minutes down the road from where I live, we need a Bitcoin club. You've got a guy here who knows stuff, hosts meetups. Happy to get in there and help you guys get something started. Do they have a Blockchain Club? I checked, several years ago. I looked online. I was trying to get something going, and I found a website that was, like, Blockchain, not Bitcoin.
And it was just like, this is what we're dealing with. I think that website has since gone down, but, I feel like the I feel like the corporate connections at the university academic system are strong, and we're gonna have to Yeah. Like everything else in Bitcoin, we're we're fighting against demand. We're gonna have to tear down the old system and rebuild a new one.
[00:10:08] ODELL:
Yeah. We saw that with, with Vanderbilt, in Nashville. We basically what we did was we we gave anyone anyone who is a Blockchain Club member, got free access to Bitcoin Park during day hours. And, basically, we we, like, targeted the leadership. They fortunately had some strong leadership on the Blockchain Club, and we we focused on explaining to them why there's Bitcoin and then there's everything else. But when they first came in with their laptops or whatever, it was just like a who's who of shit coin corporations. You know? They had, like, their ledger stickers and their like, the the best case scenario was like a Kraken sticker.
But their whole their laptops were just, like, loaded, Solana, everything. So it's a work in progress, but we'll get there. There's there's also, Arsh, who's most well known for his work, with HRF. They have some program that they're doing trying to expand Bitcoin clubs, around the country because he's a Zoomer and pretty young. So I have faith in Call me. In the youth. It's just gonna take a bit. Yeah. I'll mention it to him. Maybe I'll connect you guys after the show. But, anyway That'd be lovely. We're supposed to be talking about hash pools. I'm pretty excited about hash pools. You were at the park, some months ago, and we had some long conversations about it.
I'm a massive cashew bull. What, what are hash pools? Why should people be interested?
[00:11:52] Unknown:
Yeah. So hash pool is, kind of a new concept in, mining pools. It's a mining pool. I guess there's there's kind of there's kind of two big ideas. The first big idea is that you don't need to, have an account to run a mining pool. Ecash makes this it gives us another path. So so I guess the biggest idea of Hashpool is that, you can represent mining shares as Ecash tokens, And you can take this sort of account database that's internal to the mining pool server, and you can externalize it as this tokenized asset that people can freely trade. Not only is it just an asset, you can do this with shit coins too, but eCash is the most private and most free kind of token that you can make.
It's built on Bitcoin. It's got Bitcoin in its DNA. And I think this is where we really should be looking, when we look to decentralize the mining stack, sort of fix some of these long standing problems we've had. Another kind of key idea is that you don't need to, be a top level mining pool. You don't need to find blocks directly in order to run a mining pool. In every engineering discipline, like a layered stack, is just a a more long term resilient and and composable, technology. And our mining pool stack is not that, and we need to get there. So the idea is kind of you can, have a smallish Bitcoin club, spin up their own mining pool instance, and they actually mine up to another mining pool, higher level mining pool that's finding blocks regularly so that you don't need, like, 10 x a hash to find blocks regularly enough to stay in business.
You can build I call it a proxy pool. And this way, you find blocks regularly and your payout is smaller as it should be. But, I really wanna enable a grassroots kind of a mining pool where a Bitcoin club, person can, like, sell Bitaxes, run an ax pool instance or a hash pool instance. We can get into that into the differences a little bit. And, provide a, like, a local community mining pool for their members. And with Cashew, Cashew has not only amazing privacy, it's got amazing usability. So you could my my sort of usability defining my my guiding light is I want people to be able to buy a FedEx.
And the first question they always ask is where do I point it? Where do I mine to? And the answer should be you should mine to my pool. And then they can install a Cashew wallet, and they can watch their ecash tokens, their their sats land in their wallet, right there in real time while they're mining. That's that's the large sort of guiding light.
[00:14:37] ODELL:
Right. So when people mine Bitcoin, this on a smaller scale, the biggest issue is is something called variance. Right? This idea that payouts take a while, to happen. And because Bitcoin mining is such a ruthless cutthroat business, especially at this point in the adoption cycle. If you're not receiving rewards in a timely manner and your variance is quite law large, the hash rate could increase and your you you end up with an with an unprofitable miner. You end up making way less money, which is why people want regular payouts. And as a result of that, what we've seen is massive centralization in mining pools because people go to the largest mining pools because those mining pools have the lowest variance.
So what you're suggesting kinda solves that dilemma to a degree. And then I guess the other piece of being a small scale miner is how do you deal with small scale payouts? And Cashew is obviously ideal for that. So it kinda hits both of those. And then on top of it, it gives the users privacy. So in practice, I like this idea of, like, I mean, you called it a proxy pool. It's almost like a sub pool. You're like, the pool thinks of you as just one miner, but then there's a bunch of miners underneath that one, quote, unquote, miner that they see.
In practice, how does that where are we in development? How does that look like in practice? Like, how how hard is it for me as a operator of a meetup in Nashville spin up a proxy pool, like, spin up a hash pool? What does it look like for the user? And then do we I assume we need mining pool support, or can I just do it with, you know, ocean or slush pool without them giving me permission? Like, can I just run it without ever talking to them? They don't even know it's a hash pool running.
[00:16:44] Unknown:
You're asking the right questions. What does it look like today? You can't do it today because there's no no one has built the technology yet. So that's exactly why I'm here. And what was the second part of your question?
[00:16:59] ODELL:
What does it look like in practice for what do you I guess, since it's not built yet or it's not fully built yet, what do you expect it to look like in practice? Am I just gonna be is it could it be as simple as me running something on a start nine? Yes. Like, how accessible is the actual hash pool operation part? I assume it's hyper accessible for the the the sub miners underneath it that are just joining your pool. But what about the act because, I mean, I think if you want broad success here or scaled success, like, that part is probably gonna be the hardest piece is making it easy for people to spin up hash pools in the first place. Yeah.
[00:17:44] Unknown:
Yeah. You did ask a question about permission. Yeah. That too. Yeah. So you you you could build one of these things to hang off of an FPPS pool. I don't think it makes a lot of sense. I think PPLNS is the way to go because the crucial difference between well, there's a couple of big differences. I think most important for this discussion is that an FPPS pool assumes the the payout variance or the luck risk, and this is just another way to say that they're pricing the hash rate for you. So when you mine to an FPPS pool, they determine the price, and they give you a flat payout for each hash. A PPLNS pool pushes that pushes that luck risk and that, pricing down to you, the miner.
And I think this is what we need for that like, that's a composable stack. We can build on top of that. If you are mining on top of an an FBPS pool and, for example, you wanna do a PPLNS payout system, you're actually paying a fee upstream to the pool to price hash rate for you, and then you're producing these eCash tokens that users, individuals, can use to price hash rate as well by trading them amongst each other. So I just don't think it makes economic sense to pay upstream and then have another market under that. So to answer the question about permission, you don't need permission.
I can spin up an account at a mining pool today, any any, mining pool that doesn't require KYC information. And PPLNS, non KYC, the only game in town is Ocean. So I think we can build the stack, and I have every intention to build this hanging off of Ocean mining, which which is great because we can take all these bid access out there that are solo mining. We can take that hash rate, and we can funnel it into the best mining pool that's doing the right thing, allowing miners to mine on their own templates, and sort of, like, strike back at the at the man, which is one one one aspect that I really enjoy about this. I also wanna point out Yeah. Go on.
You mentioned earlier, the that that the payout variance makes makes small scale mining hard. I think there's actually two issues here. Payout variance is one, but we can kind of tune that. And the bigger issue is the minimum payout threshold. So if I'm mining to, one of these large monolithic mining pools, I need to earn several hundred or thousands of dollars in order to afford a payout. And on a bid access, it's just not feasible. Like you said, that the hash rate will go up before. You can never afford one of those payouts, and you're essentially
[00:20:23] ODELL:
you know, you're you're you're running slower than the the field goal is moving away from you. Because they need to pay you out on chain. So if the, like, the outputs are too small, then it's not economic it doesn't make economic sense.
[00:20:36] Unknown:
Yes. Although I'm working on something. I'm not ready to talk about it yet, but I think I have something in mind for that. But what, Ecash lets us do is we can drop this minimum payout threshold from thousands of dollars effectively down to zero or down to one sat. So you can plug your bid acts in in mine, and what happens is the Ecash mint actually receives the payout, and then you just get your ecash from the mint. And it is it is custodial. We can get into that later. I'm sure you're gonna ask some questions in that regard, but, this is how we get this is how we get one set payouts. It's it's just not feasible with any other technology.
[00:21:12] ODELL:
Yeah. I mean, the status quo the status quo is custodial anyway, so I feel like it's kind of a, you know, just strictly net net benefit.
[00:21:23] Unknown:
Right. The choice is between, a captured custodial account with a where you have to earn a large payout or, like, a custodial, private microtransaction, non account system. It's like win win win. But but their both systems are custodial.
[00:21:43] ODELL:
And then you can exit on lightning at any point at small amounts too. So doesn't require permission. So you don't need you don't need or, like, we'll use ocean as and by the way, I intentionally when I used two pool examples, I used a f FPPS pool and a p, PPLNS pool, that both didn't do KYC, as my example intentionally. Because, like, for instance, you can't mine with Foundry unless unless you have coffee with them or something. Like, they need it's, like, more than KYC. Like, you have to, like, actually, like, sit down with the suits and have a conversation. But, the FPPS pools are obviously have been way more successful lately. Right? Like, Ocean's trying to buck the trend.
So I do wonder if some people would wanna run a hash pool underneath there. I guess that, like, your concern is, like, more of, like, there's, like, an almost like an arbitrage type of situation. Obviously, you're paying them for taking on the risk, to give you the blended payouts, but I don't see it. How does that that wouldn't necessarily harm the hash pool operator. Like, that doesn't matter to them. Right?
[00:23:05] Unknown:
Like, where's the It doesn't. It makes the cost it makes the cost of it so one of the, alright. Let's back it up. When you mine a share up to a hash pool, you get an ecash token that represents that share. We're calling it ehash. So you get an ecash token. And these tokens are a futures asset, so you can trade them to each other. I can mine up some ecash. Its value in Bitcoin is not determined yet. So we have to wait some amount of time for the pool to find blocks. And once the pool finds blocks and our time window closes, now the Ehash token value is set in Bitcoin.
And until then, it floats. That's what makes it a futures instrument. So if you're building a futures instrument on top of a mining pool that's already pricing hash rate, you just pay you're just paying, like, some percentage upstream to to offer this this, pricing for you, and now we have this futures market to again, where we're already paying the piper. I just think if you stack up a hash pool built on a PP on us side by side with one built on an FPPS, you're gonna have categorically higher fees on an FPPS pool. I think it will be not competitive in the long run. You could do it. That makes sense. It's it's totally possible. I just don't think it makes economic sense. So it it
[00:24:26] ODELL:
it it so if you're mining on ocean, you actually kind of get the benefits of Yes. Because but in a free market way that you see with the large pools. Because you could actually if you wanted to not take the risk, you could just kind of I was presumably, if this is successful, there'd be, like, trading avenues where you can trade it and and not take that risk. Or you can increase your risk if you want.
[00:24:55] Unknown:
I think the default will be just mine up your ehash and you hold it, and you just wait, and it'll turn into Bitcoin automatically. And you can just DCA that way. Same as you mine anywhere else but with micropayments now. But it is possible to trade these things, and I think that's great. I'm not planning to build a marketplace. I think if there's demand, people will build their own marketplace. It probably should be a Nostril relay, Probably should have, you know, make or taker orders, but, I'm not gonna solve that problem. If you guys like the stack, you like playing with this, go out and build it, and let's free the world.
[00:25:35] ODELL:
Fair enough. I mean, that's the beauty of open interoperable protocols. So the so so in practice, this doesn't require permission. Is there any benefit if you get Ocean's blessing? Like, is there things you can do that you wouldn't be able to do otherwise if you had Ocean's blessing? Does it not even matter whatsoever? Or
[00:26:01] Unknown:
benefit? Well, I mean, they could probably make my life hard by finding ways, like, playing whack a mole.
[00:26:07] ODELL:
They can Which is, like, blocking our keys or something?
[00:26:11] Unknown:
I have no idea. I think we're all pulling in the same direction. Honestly, I hadn't thought about that question. That's interesting. I kind of assumed I've talked to the ocean guys, and, I think you while we were talking to them, so I I didn't wanna I think they could make my life a little harder or anyone's who's trying to build on their on their, mining pool. So, obviously, I would prefer to work with Ocean than against them, but as long as you have a non KYC pool that anyone can join, I'm not sure that there is gonna be an effective way that they could stop me from building on their stack. This is freedom technology. You know? It's permissionless, and I'm very much building it in that way, intentionally.
And I think Ocean is building in the same way. They're building a permissionless tech stack as well. So I don't see any reason why we why we would not get along, but, the cool thing is I don't see any way that they could really stop me. I guess they could go full KYC. That would be bad. I don't think they will.
[00:27:16] ODELL:
No. That's not gonna happen.
[00:27:18] Unknown:
Yeah. That's not gonna happen. Same.
[00:27:22] ODELL:
I mean, I think they would shut down before they went that path if they were, like, forced to or something.
[00:27:28] Unknown:
Yeah. That's why the ocean guys are awesome.
[00:27:32] ODELL:
Yeah. No. I agree. I'm right there with you. I had a great conversation with them. If for some reason you're a new listener, so dispatch, consider going back and listening. Add their entire their entire team on. They're awesome. And it seems like they're finally starting to get some real momentum. I think hash pools here could be a big addition. So one thing that Ocean has is the individual miners can choose which transactions are in their block using something called Datum, that they developed. And a bunch of their miners have opted into it. So in this situation, the person who's running the hash pool is building the block templates and deciding which transactions are in a block.
How how have you can thought about that? Is that is that just like, you know, someone trusts you. They're like, okay. I'm just gonna mind your pool. You you construct the block, or is there any transparency element there? Like, how do you think about that?
[00:28:38] Unknown:
I'm not I'm not gonna make that decision for anybody. We're gonna build the the best thing we can and push it out, and then we're gonna keep improving on it. I think long term, users should be able to pick their own block, and I and I and I hope to get there. But, like, for now, the the simplest thing to get out the door to get people hashing, on Hashpool the fastest is that the pool itself produces blocks. But, we don't wanna stay there. The the nice thing about DATM is that I I watched the DATM talk. I went to BDC plus plus last week, and I watched, Jason Hughes, discuss the DATM architecture, and it blew my mind.
Because, when we talk about proxy pools, they've already gone out and built it. I've been, like, planning this for a long time. They just went out and built it. So each DATAM gateway is a proxy pool, and they can actually daisy chain them together. So I think there is probably, some and and and a side note, Hashpool right now is built on Stratum v two tech stack. That's just where I started. It was the easiest place to start. But but all I'm keeping my options open for all of these things. I would love to roll it into the datum gateway and just have a datum hash pool.
But but we'll see. We'll see what technological decisions make sense at each stage. But there's no reason that the end user can't produce their own blocks. There's no reason you couldn't have the hash pool runner produce their blocks as well. And I think in terms of onboarding new users, we should have the proxy pool have an option where they don't have to pick their own block template. Because if you just sold a BitX to someone who's interested in getting started, they've never done anything with Bitcoin before. You're like, here. Have a have a BitX. And by the way, you need to install a Bitcoin node. You need to take a position on the latest filter debate, decide what you're gonna and produce block templates. Like, that's just too much. When I talk about solving the usability challenge, this is this is part and parcel. We gotta we gotta take the new users and guide them one step at a time.
And I think producing your block template is somewhere somewhere beyond step one in that journey.
[00:30:46] ODELL:
Fair enough. But that is interesting that, if at some point in the future, if a hash pool operator wants to further decentralize the block construction, presumably people that are actually sub users of that hash pool could actually be using data themselves and constructing blocks as kind of a powerful mind bending concept. You could have, like, a single bid ax, and you could be constructing blocks. Yeah. Why not? Kinda crazy. So we have, first of all, shout out Gary. Zapdos five thousand sets. Said, I spent most of my Zaps buying swim trunks at BTC plus plus, but here's some value for the immense value received. Thank you, Gary.
We have Itz Morrow in the live chat asking about the pros and cons of this versus the bulk 12 payout scheme that Ocean has implemented. Do you have any thoughts on that?
[00:31:47] Unknown:
Yeah. Bolt 12 is great. If you wanna do bolt 12 payouts and you have the technical acumen to set that up, you should go ahead and do that. It's not it's not very easy, and like we just said, you know, having taking a brand new Bitcoiner and asking them to set up a lightning node, I feel like it's not that like, that's the bad path. That's that's, like, step six or seven instead of step one. But you absolutely can do that. My understanding is you need to, you need to have a lightning node or lightning wallet that accepts both 12 payouts. On Ocean today, you create an account, which is just a Bitcoin address. It's a pseudonymous account. If you wanna if you wanna just take it a step further and take your rewards in bolt 12 payouts, you need to sign your bolt 12 address using the private key from your on chain address.
And, like, take a new user who you you just told about Bitcoin and explain that to them and get them up and going. You're talking about, like, a day or a week of work depending on their technical skills. But but in terms of comparing eCash with both 12 payouts, I think they're roughly equivalent in terms of privacy. I think ECash actually has better privacy, but good enough. They're they're they're close enough that it's it's you can consider them close, but basically the same. ECash enables this, futures instrument, so you can't trade your shares with other people. Although, maybe stay tuned. I think Ocean is cooking up something awesome in this vein as well.
Yeah. Does that,
[00:33:27] ODELL:
it's more I think that's a good answer. It it's hash pools have less friction for the end user. The other piece is, I mean, I think in practice, what you would probably see with most users right now with bolt 12 payouts is they're probably installing Phoenix Wallet because they're not gonna run their own node, which has bolt 12 enabled. But the problem you come into into play with is every sovereign Lightning transaction at its core is got a base on chain and has, you know Lightning is effectively, a open protocol for batch Bitcoin payments. So you have an on chain burden regardless. So you can't really receive lower threshold amounts in terms of payouts in an economically viable way.
What what ends up happening is you're gonna be keeping it with the custodian at some point along that path, whether it's Ocean or someone else. ECash, as you said, like, you can just be I can just be receiving two set payments, four set payments, 10 set payments. And then, eventually, when they hit a threshold where I can then take them to my self custody lightning, then I can then transfer them out and just makes it a much cleaner process. Yeah. Alright. Yeah. There's a great saying Phoenix doesn't work. Maybe because it's not always online.
I don't know. I haven't tested out both 12 Phoenix for both 12 ocean payouts.
[00:35:01] Unknown:
Phoenix uses this really cool DNS technology to announce your lightning address, so that might be incompatible. I think core lightning node What I've what I've heard is the core lightning is the way to go. And if there's any ocean guys in chat, please correct me if I'm wrong.
[00:35:22] ODELL:
He's saying CoinOS, but CoinOS is custodial. I don't know. Well, anyway, the point here is that there's a lot of friction. And I think the point with hash pools is that we can reduce a significant portion of that friction without putting any additional burden on the pool operators, which is already a hard business. Yeah. And then everybody wins.
[00:35:45] Unknown:
In order to get, spun up on lightning, you have to bring Bitcoin to the table. You have to have some Bitcoin already in order to open a lightning channel or pay out of band to get someone to open a channel to you. And, again, mining with a BitX, like, we're talking about brand new Bitcoiners. They don't have any Bitcoin yet. All they have is a BitX and some and a little bit of hash rate. So this really this really takes the hurdle rate to onboard someone from up here, you know, down to as low as it can possibly get.
[00:36:17] ODELL:
Yep. That makes sense to me. It's like the Lightning has a zero to one problem. You can't just start fresh unless you're using custodial. And if you're gonna use custodial cash, you ecash is the best path, in terms of trade offs and interoperability and offline payment. There's so many advantages. Okay. So where do we stand on this project? What are you thinking about timeline? How can people help? Like, how do we supercharge this? What does it look like?
[00:36:48] Unknown:
So there's three big pieces. There's issuance, which is generating the eCash tokens when a share lands. Then there's redemption, which is turning those tokens into Bitcoin when the pool finds rewards. And I think we can launch, with just those two pieces in place. The third piece, which I haven't even talked about, is verification. And we can get to that in a second. But, we're closing in on, having issuance, ready. I just got sort of a prototype working. My man Gary, average Gary in the chat, he's my number one coconspirator. He presented at, BTC plus plus an ehash, or a hash pool code tour and, claim some ehash into a browser wallet right there on stage. So it works. It's messy. We need to clean it up a lot.
There's a lot of, chewing gum and bailing wire in there. But, we're closing in on the first step, issuance. And then redemption, we've got this yeah. Salute to Gary. Redemption, we've got this, I I think I was originally thinking if you watch my talk at at BDC plus plus in Berlin, the eCash edition, I was thinking more in terms of, building my own PPLNS payout system, and now I think we can launch a proxy pool on Ocean and actually just do proportional payouts. So whenever Ocean finds a block, we just take all of the Ehash out there. We close it off. That's a tranche of Ehash, and it will now have a Bitcoin value, and those users can get paid out. So we're sort of, taking the the the the ocean block time and sort of segmenting up the eCash that way and issuing payouts that way. And I think this will be the quickest way to go live because I want people using it. I want people trading ehash and mining ehash as soon as possible, because we have to accelerate, because the clock is ticking. You know? We either build FreedomTech or we succumb to the CBDC dystopia.
So I'm just trying to find the shortest path to victory, and, I think that might be it. So I'm hopeful that issuance, we can get that going pretty quickly. Hopefully, by the end of the year. I don't know. Time lines are rough. As a software developer, everybody wants to know when's it gonna be ready in two weeks. It's an impossible question because there's unknown unknowns. Like, everything between now and the finish line is unknown unknowns. I can estimate the known knowns, but you never know what's gonna pop up. There might be some technical challenge. Yeah. Did that answer your question?
[00:39:30] ODELL:
Yeah. I guess it it did. So you mentioned you mentioned verification. What is that piece?
[00:39:39] Unknown:
Ah, verification. So this is one of the really cool things that, kind of I was thinking about this before I even decided to start building on this, and it solves a lot of problems. It seems to like, the puzzle piece just seems to naturally fit. There's this protocol called, proof of liabilities. It's really a protocol sketch that Cali published some time ago, years ago. I was reading an early draft of that, and that really got the wheels turning. But, basically, in an ECache Mint, you can collect all of these blinded messages, blinded secrets, unblinded messages, unblinded secrets, and you can, well okay. You you collect the blinded ones, and you publish a report after the e cash epoch expires. So this is when you so in an e cash mint, you have all of these, public private key pairs.
You've got the whole this whole set of them, and they each sign a a denomination of token. The a denomination is like a bill. Like, you have a $1 bill, fives, tens, twenties. In ECash, you have, bills as well. And there's a different private key that signs each bill, and that's how the Mint knows what they are. And periodically, they're gonna rotate these private keys, and that sort of closes off it's like saying we're not gonna issue any more eCash with those keys. We've got a new set of keys now. We can tap into this and publish a report of a closed epoch and all the secrets that the Mint knew about, zip them up in a Merkle tree, a Merkle sum tree so that we know that that they total up to the right amount and publish it. And anyone can come by after the fact and their wallet if their wallet supports this protocol, they'll have their secrets in their wallet that they gave to the Mint and the and the signed messages that they got back. And they can verify that all of their eCash operations with the Mint are represented.
So we have this sort of distributed, verification process. And the cool thing about Hashpool so so Cali figured all that out. He's he's a gigabrain. I love that guy. Legend among men. A legend among men. Allegedly, a man, although I won't be sure. The cool thing about Hashpool is that, we're trading shares for ecash. So we've got this proof of liabilities. We can prove all these ecash tokens. We also have mining going on on the front side, another provably verifiable process. So for every block height, we know what what block template we could mine on at that height, and we've got a share, which, adds up to this this, like, random number with a bunch of zeros at the front.
We can just publish all of this information in another Merkle sum tree, and now we've got assets on one side and liabilities on the other. We can put them put them together and publish a proof of a % of all the mining pool operations and sort of after the fact prove with with absolute fidelity that this is a fair a fairly operating mining pool. And by the way, it preserves user privacy also. I mean, if somebody knows what hashes you're mining on or what templates you're mining on, they they can probably dox you that way. But
[00:42:48] ODELL:
Because the concern is that the hash pool operator would be leaving some on the like, you would just take could take a portion of the rewards and not pay you out effectively. Right? Or I guess they could even inflate the ehash supply. Right? They could just be, generating ehash without actually doing work and inflating your but so this would solve that, or would there still be concerns with that?
[00:43:18] Unknown:
I think it totally solves it. If you read the proof of liabilities, protocol, there's a couple of gaps. Namely, we can only verify so we're relying on the users to verify their e cash on in their wallet, but I think that's okay. The the real asset
[00:43:38] ODELL:
what other people had, so I can't verify that the whole thing is correct. I can just verify that I'm getting paid proportionally.
[00:43:46] Unknown:
Right. Right. When you check your you know, when you balance checkbook, you can only know what the bank is sending you. You don't know what the bank is doing with other customers. Damn it. Where was I going with that?
[00:43:59] ODELL:
You're gonna do you require as purse it requires the individuals to verify.
[00:44:03] Unknown:
Yes. Oh, the gaps. The gaps in the protocol. So How does a high school operator fuck you?
[00:44:09] ODELL:
It's my How do they fuck you? Basically. Well,
[00:44:11] Unknown:
let's let's back up. And we're not talking hash pool. We're talking eCash Mints. So an eCash mint operator can fuck you if they, if they keep if they keep inflation under the amount of unclaimed tokens. So if I'm a mint and I issue out 100 Bitcoin worth of tokens, I'm a big I'm a big mint, and people only redeem, like, 99.9% of those, I can actually inflate that point o 1% of the money supply, and no one can detect it. Because if you add up all the eCash tokens in everybody's wallet, it adds up to 99.9 Bitcoin. And I I've actually now inflated the supply to 100.001. Nobody can prove that.
So but if you take so that's just proof of liabilities. If you now come to the other side of the table and prove assets, you can you can prove that we we received shares for that amount to this total amount of difficulty, and we issued ecash that amounts to this total amount of difficulty. So even if someone doesn't, claim those shares, if as long as my share reporting oh, yeah. You did. Okay. So I would have to selectively exclude some shares from the mining report. But here's where here's where it gets tricky for the mint operator. So if I'm mining to the Mint and I'm pushing shares up to them and they just reject some of them or they tell me that they accepted my share and don't put it in this report, I can go back later and say, hey. Hey. What happened to this share? You you gave me ecash for this share, but it's not in your report. So what like, what's going on? What's the discrepancy? Explain yourself.
In this way, we can kind of, like, we can kind of box in the mint. There's there's probably stuff they can do to cheat. Now this is a business, and it's and it's they they can always, like, reject your share. So if I go to Family Dollar and I give them a dollar and I say, I would like to buy this, if they don't give me the goods and services, they take my dollar and they'll give me the goods and services, right, this is any business can do this to you. Right. And eCash Mints are no different. But we can solve that on the social layer because, like, that's brazenly cheating. What you need to be careful about, what you need to be vigilant about is, like, hidden hidden cheating.
[00:46:33] ODELL:
Yeah. So, I mean, with this, it's a little bit different than solid inflation with a cat a regular cash human because you anyone can go and check to see how much the payouts have been on the ocean side. There can be, I guess, like, presumably, like, if I'm mining on a hash pool, right, And I'm getting ehash. Right. I'm doing, I'm doing the work. I'm getting ehash. And then it turns into ehash. It turns into actual Bitcoin or Bitcoin denominated ecash on the Bitcoin denominated side, the mint, presumably it's in the same mint. Right? Most people are gonna stay in the same mint at that point. You could solidly inflate on the Bitcoin side if you wanted to be malicious.
Right? There's no way to prove there'd be no way to prove that. I don't I don't think you could. How how would you do that? Yeah. Yeah. I think you're right to assume that it's You could just produce more you could just produce more e cash. Right? You can just silently inflate it. If if people are withdrawing, then they wouldn't know until they run the bank.
[00:47:47] Unknown:
So, with the proof of liabilities, there's a continual bank run. So you do run the bank. Every time the eCash epoch flips, you're gonna close out that old epoch. And in my view, in my vision, I think these Ecash tokens will have a time limit because, the the the mint doesn't wanna have the so so when you issue Ecash and then the epoch closes out, its its value is now determined in Bitcoin. You basically have a stablecoin out there. And we're a mining pool. We're not in a business of stablecoins. You know, stablecoins, you know, go go buy some Tether. We're not in the business of stablecoins. I want you to close these positions out, get rid of these e cash Ehash tokens and and turn it into Ecash.
So by adding a timer on on your Ehash tokens, we can force a continual bank run on the mint. So they have to zero out their liabilities in an ongoing fashion. And I I don't I've I've thought about ways to cheat. I haven't come up with a good one.
[00:48:47] ODELL:
But keep keep poking that. Like, maybe So we don't that's not live anywhere in that in regular cashew mints, this proof of liability concept. Right?
[00:48:56] Unknown:
Yeah. I don't think we've really, achieved the scale yet to make it worthwhile. ECash mints today are kind of toys. I don't put significant amounts of money in there, and you shouldn't either. This is very alpha technology. We gotta walk before we run, but I do think it's coming. I think it's inevitable.
[00:49:13] ODELL:
But so where I'm going with this is if it's actually verifiable and the Mint operator can't easily cheat you, then there's actually an incentive for larger miners to use this, not just like, bid access are the proof of concept. And that's also awesome just from, like, a Freedom Tech point of view, onboarding people know KYC Bitcoin, yada yada yada. But the big big miners have an issue where they don't know if they can trust the mining pool operator. If the mining pool is skinning off the top, it's hard to verify. Particularly if it's non ocean, it's it's hard to verify that they're they're messing with you. In this situation, it it probably actually would give them a benefit too. Right?
[00:50:00] Unknown:
Yep. I think you're exactly right. I've talked to large mining pool operators, and they constantly get this question. They spend a lot of time and resources, trying to convince their miners that they're getting a fair shake. And they'll get calls all the time that's like, hey. This share was rejected. What happened? What what about over here? We we got some rejections over here. Can you explain that? And there's no paper trail. Right now, it's it's kind of just the the trust me model, and they have to build these personal relationships to smooth things over. If you could just publish a report, publish some software, like, like river.com.
They have, quarter is it quarterly or monthly audits? They just push push it all out there, and you can verify yourself. This is where we're going. Big shout out to River. These guys are crushing it. I love what you're doing. We're gonna do the same thing in the mining pool world.
[00:50:49] ODELL:
That's awesome. I mean, I think that that I'm I'm not gonna compare and contrast which one is a bigger impact, but that could be that could be absolutely massive impact, to have more verifiability for the larger mining pools. Mining mining operators, not the pool, the, not the pool operators. Okay. So in practice, do I need, would I need a, as a user, let's say I'm a humble bit ex owner, never used Bitcoin before my life. Will I just be able to use like any, any Cashew wallet with to receive my ehash? Like, can I just use Cashew.me and just receive my ehash there and spend my ecash there? And you don't need to set up a new, you know, front facing wallet interface? Or
[00:51:43] Unknown:
Yep. That's exactly what we're shooting for. And, yeah, we so we're making it, compliant with the spec. The first design sort of, built it the way that it was the first iteration, the way it made sense in my head. I brought a PR to the CDK meetup, the Cashew DevKit meetup, and they were like, yeah. This is okay. You should, read the spec though and follow the quote design, and so we've been redesigning it. I actually read the spec. And, now it's now it's it's a pretty sweet system. So, in the new design, I want you to be able to, just have a wallet, have your BIDEX.
You you you plug in your BIDEX, you get it going, and then you don't have to talk to your BIDEX anymore. And you can just pull up your wallet on your phone and sweep the, tokens from the mint in that way. You're gonna have to have a shared secret. So when you plug up your BIDEX and and the first design is also gonna have a proxy that you have to run on your, local server, your self hosted server. So you'll you'll run so kinda like a datum gateway. You'll you'll run this app on your server. You'll point your bid acts to your own, proxy on your local network.
It actually is cashew aware, so it's doing all the wallet stuff on your home server, sending the blinded secrets, through the stratum, messaging protocol to the mining pool or the act the the the axe pool. Axe pool is what we're calling the one built on ocean. Hash pool is is sort of this other project that is not a proxy pool. It just mines blocks directly.
[00:53:21] ODELL:
Okay.
[00:53:22] Unknown:
So in axe pool, you run a in the first iteration, you run a
[00:53:27] ODELL:
a a stratum proxy on your self hosted server. You mine So it's a star nine. You're running it on, like, a star nine. Boom.
[00:53:34] Unknown:
Yes. And you plug in a shared secret, and then you have a Casio wallet. You put in the same shared secret into your wallet. And now when you mine up a share, it just lives at the mint. And you open your wallet whenever at your leisure, and it'll go to the mint, and it'll say, hey. Do you have any quotes for me? Alright. Here's the secrets. I've signed these messages. Give me my Ecash. So you can just plug and play at home and then go on to the other side of the world and just watch ehash, like, land in your wallet every time you open it up. So both sides need to be running a proxy
[00:54:07] ODELL:
on their home server, like the it's not just a hash pull operator that's running something
[00:54:15] Unknown:
or did that Yeah. In the initial design. And the reason for that is that we just need, some we just need a Cashew wallet. We have to put a Cashew wallet somewhere. I think a very, very quick follow after that is to put the Cashew wallet into the Bittax firmware. And all credit to Scott, he's building in an open source way, so we can do that. It should be a a small lift to get, to get that far. And if you go to my website, the Bittax
[00:54:40] ODELL:
So then the Bittax is the home server,
[00:54:43] Unknown:
right, basically, in that in that situation? Yes. Yes. Now you don't need to be online
[00:54:48] ODELL:
running twenty four seven. Right? Might as well just run it there. Yep. Clever.
[00:54:54] Unknown:
That's that's where we're trying to go. Yeah.
[00:54:57] ODELL:
Because then you really reduce the friction. Then all the person needs is a bid x and, you know, p w a like, Cashew.me, you could just run-in a browser. They don't even need an app. And then they're off to the races. They're good to go.
[00:55:13] Unknown:
That's the vision. If you are an engineer and you like to nerd out on stuff, go to hashpool.dev. Click on the diagrams view. I've got a bunch of mermaid diagrams where we're planning this out. If you're not an engineer, don't worry about it. It's just like boxes and text. It's gonna be boring.
[00:55:32] ODELL:
Hashpool.dev. Check it out. Yep. Hashpool.dev.
[00:55:35] Unknown:
And read the article. If you're nontechnical, go read the front page article. It it I've laid it all out in plain English. Like I said, I run a bit dev, so I like to explain everything in plain English. And if I can't, then it means I don't understand it. So, read that read that article.
[00:55:54] ODELL:
Shout out to Drew who zapped 21,000 sats. Thank you for your support, Drew. Appreciate you. What else happened? Have we is there anything else you wanna cover before we wrap here on the Hashpool side?
[00:56:13] Unknown:
We're looking for contributors. This is an open source project. There's too much work to do. I can't do it all myself. Average Gary is helping out, bringing up some more contributors. Check out my my issues page and, join the, the revolution. We're gonna fix mining from the ground up.
[00:56:32] ODELL:
Love that. While I have you, what was your thoughts on this last week in Austin? BTC plus plus, how'd that all go?
[00:56:43] Unknown:
That was amazing. Incredible. Nifty puts on an amazing conference. I saw so so so there's a lot of drama, as you know, over opera. There is, unfortunately. And there was a lot of, events and and and and stuff catering to the drama. But after it was all said and done, I went to an after party, and I saw knots I saw team knots rubbing elbows and having laughs and getting trolled and trolling team core back. So at the end of the day, I I try to I try to stay above the drama. I don't I don't think opportune is important. I don't think we should be having all these divisive knockdown drag out fights because at the end of the day, we're all Bitcoiners. We're all on the same team.
Knots nodes are Bitcoin nodes. They are building blocks and relaying transactions. Bitcoin core nodes are Bitcoin nodes. We're all in the same blockchain. So it's I mean, I could go on and on, but I don't wanna take over. I I think the BDC plus plus event brought people together, and I was very happy to see that happen. I I have mad respect for Core. I have mad respect for, Ocean and those guys and everything they're doing. They are the tip of the spear of the knots movement. And and I you know, I'm a dad times four, and it's really reminds me of when my kids fight with each other. And it's just such a tough spot to be in, and and it brings out all these complex emotions. It's like a swirling mass of anger, sadness, disappointment, frustration when your kids fight with each other. And I just wanna get my dad voice out and tell all of these people sniping at each other on social media to go to your fucking room, stop behaving like this. We're all a family together.
Think about what you've done. Behave like an adult. We can have reasonable discussions here, but sitting back and, like, sniping at at other bread corners is is net negative. Y'all are seriously you're fighting over pennies in front of a steamroller. We have we have serious problems to fix. We need to fix the mining industry. We need to, watch out for attacks on Bitcoin, and, you know, the the the knots people have some good points. My node, my filter rules, very good point. They are absolutely correct. Core people have some very good points too. If you look at it, there's a narrow band of transaction sizes where, there is no good choice to get those transactions mined. And so now we've got protocols that are doing things that are more harmful to Bitcoin in that tiny narrow band, and we're you know, the the the PR request is to close that narrow band.
And does it matter in the long run? No. It doesn't fucking matter. They're gonna do what they're gonna do. We we just need to we need to focus on the the big thing. Keep your eyes on the prize. Stop squabbling like children. Go to your room and think about what you've done, and come out when you're ready to have a reasonable debate. And that's my take on opportune. You're not gonna drag me in to one side or the other, because I'm I'm fighting for the end game here, and you should be too. That's my take on Opper Turn. Nifty put on a great show. It was amazing to watch Bitcoiners rub shoulders and and be jovial. But then, you know, the conference ended and the sniping started back up again on social media. Yeah. I mean, social
[01:00:24] ODELL:
social, it's it's a good thing you, I mean, we we started this conversation talking about meetups. Right? And social is, like, not social just brings out the worst in people, and in person does the exact opposite. So it's like it's a balancing function. And that's why I think it's important that we have more in person reaction, not less. And the front lines of that is meet ups. The large conferences kind of don't do it. But the smaller focused events, whether those are meet ups or things like b two c plus plus, which averages, like, 200 people, 250 people. That's probably, like, the upper bound where you have, like, really productive maybe it's a little bit higher, like, 500 people. It's like the upper bound where you have actual, like, productive dialogue and conversation, and people work better in that environment.
But, yeah, I would say the number one thing that I think is great that came out of this debate or drama or however you wanna put it is, I guess, a lot of people forgot the main one of the main core fundamental values of Bitcoin, which is, like, software maintainers don't dictate what you run. Like, at the end of the day, this is all open source software. You choose what you run. You could modify it if you want to. You're able to verify it yourself. And and and there's not like devs don't get to dictate how you live your life. And that's the key difference between an open source movement and an open an open protocol versus closed proprietary systems. Like, if Google changes something on fucking Gmail, like, you have to take it. You have no choice.
They will just press the update button, and you have no choice. But that is different with Bitcoin. And it's so it's good to see people starting to realize that again. The I to me, the frustrating part is there's, like, 5,000 people arguing on the Internet less. And then there's, like, a 50,000 people on the MSTR earnings calls. So there's, like, a little bit of a disconnect here, but I I'm glad people are taking sovereignty back.
[01:02:51] Unknown:
Yeah. For sure.
[01:02:54] ODELL:
Awesome. Sir, this has been a great chat. It's been a pleasure having you. I I think it would be great if we could do a follow-up at some point in the future when we're closer to production. Like, we'll update. That'd be great. So we'll stay in touch in that front. If there's anything I can do to be helpful, as always, don't hesitate to reach out. I'm I'm incredibly bullish on Ashpools. I appreciate, your work on this front. I think it's gonna be a massive, massive win, for the ecosystem. Do you have any final thoughts before we wrap?
[01:03:36] Unknown:
Thank you. Appreciate boosting my voice and my project. That's why I decided to work on this. I do think it it will be a massive win as well. We need funding. We need support. We need people to get the word out. So big thank you, and keep crushing it. Love what you're doing.
[01:03:55] ODELL:
Much love. Appreciate you. Appreciate you, freaks. Thanks for supporting the show. We'll be back next week, Monday, nineteen hundred UTC. Join us live. Civildispatch.com has all the links you need. Stay humble, sax hats. Peace.
Important things to keep in mind if you just look at Bitcoin, it doesn't matter. Right? Bitcoin doesn't care. It's back in the 6 figures with a lot of room to go. If you compare its primary functional use case, which is actually a check and a balance on the lack of accountability and fiat unit creation, we still have a long way to go. So gold is a 20,000,000,000,000 market cap. Bitcoin is still 2,000,000,000,000 despite functional superiority to gold. It's much harder to steal, much easier to store, much easier to instantly transport, and more importantly, you can actually audit it. So I don't know if you saw, but there's an estimate that said that auditing Fort Knox would take forty four thousand hours and approximately eighteen months to complete. I think it'd be a lot a lot nicer for the American people if they could just go to a handful of auditable, Bitcoin addresses on a Blockchain Explorer and see exactly where the American people's Bitcoin
[00:00:52] Unknown:
is.
[00:01:26] ODELL:
Happy Bitcoin Monday, freaks. It's your host, Odell, here for another civil dispatch, the interactive live show focused on actionable Bitcoin and Freedom Tech discussion. That intro clip was Bill Miller the fourth, who is the son of Bill Miller the third, infamous investor, who's very bullish on Bitcoin now, apparently. They have been for a little bit, but that was kind of a bullish clip, and that's why I highlighted it. As always, dispatch is funded by our audience. We have no ads or sponsors. We are powered by viewers like you. So thank you to all the freaks who continue to support the show with Bitcoin donations.
All the relevant links are at silldispatch.com. The two main ways to support is Zaps in our live Nostra enabled chat, which you can find at silldispatch.com/stream or through podcasting two point o apps like Fountain Podcasts. The largest app we received through Fountain Podcasts this week was from lean ad with 3,333 sets saying, yes. Bitcoin community is smart, nice, and helpful. Aristocracy pleb. I am newbie. Don't really know what that means. Thank you for your support. Appreciate it as always. I see we have two rider die freaks in the live chat already, both Gary and Rob Hamilton.
It's good to have you guys here. We have a great chat lined up today with VNPRC who runs TriangleBitDevs and has been very focused on hash pools recently. I think we'll be talking about both and maybe some other topics. How's it going, sir? Good to see you.
[00:03:15] Unknown:
It's great to be here.
[00:03:18] ODELL:
Thanks for having me. For starters, well, what's how did you come up with your NIM? What's the How did I backstory on VNPRC?
[00:03:29] Unknown:
It's a, it's a, just a combination of characters that's, like, not taken on any social media site.
[00:03:39] ODELL:
Okay. Is that really the it has nothing to do with the People's Republic Of China?
[00:03:46] Unknown:
No. It does not. But, I'm sure we could come up with some acronyms if we tried hard enough.
[00:03:52] ODELL:
I always I've at first, I kept getting confused and thinking it was VNRPC. And now I remember it by People's Republic Of China. Like, that's how I'm like, okay. I gotta get the tag right. But, anyway, here we are. Yeah. So I think let's just briefly talk about triangle bit devs. What are why why are you so because I grew up on bit devs in New York, the original bit devs. Why are you so focused on on running a local community of BitDevs?
[00:04:28] Unknown:
Well, local community is is what makes Bitcoin happen. I'm a grassroots. I always have a bottom up perspective of everything. I started MyBitDevs because we we've had a a social meetup in Raleigh forever. If you talk to Simple Steve, he'll tell you it's the oldest one in the world. Nobody has contested that claim, so it's sort of like be true. He wins by default. Must be true. But, I, at some point, I I mean, I don't know how far back you wanna go, but I've been a Bitcoiner for a long time. Eventually, at some point, I I decided to get serious. I got really fed up at work. This was during COVID. I got burnt out, quit my job, and, started going to conferences. My brother actually dragged me to conferences. I I don't really like to travel, but, it was worth it. And I went to TabConf, like, a month or two later. I knew I had in my mind an idea that I wanted to run a technical meetup because I'm a programmer. I'm a super geek. I like to geek out on the protocol super hard.
And, the the social meetup is fun, but you get to drink in beers. You get a little sloppy. I want a deep focused technical conversation. And I went to to TabConf, and I saw my first bit of there. I participated in a a session run by Jay. I think it was in 2021.
[00:05:53] ODELL:
The original blew my mind. Jay is the guy behind New York bit devs, the original bit devs.
[00:05:59] Unknown:
Exactly. Yes. And, it blew my mind. I was I was just blown away at all these deep technical topics that I'd never heard of. I hadn't really been paying attention to the mailing list or anything like that. But I've been studying Bitcoin for, I don't know, a decade at that point, maybe. And then I I I talked to Jay at a bar, like an after party, and I said, hey. I wanna run one. And he said, cool. We got a blog post. Just read this blog post that tells you everything you need to know. Next month, I started up, for SpitDevs, and I think that was in, December 2021, and I've just been going hard. And on the blog post, if you read it, it's just like, the hardest thing to do is find a location.
The most important thing is consistency. So I've been consistently hosting meetups, every month for over three years now. I did miss two because I traveled to other cities to host vid devs around conference times. So, but, yeah, it it it, it's a really it's a really great sort of forcing function because I have to compile this list of topics. I have to read about them and learn about them enough to explain them to someone else. And I've always believed that if you can't explain something in plain English, then you don't understand it. So I just try to go out and learn this stuff and explain it in plain English and, try to grow my local community so that we can have we can have a Bitcoin hub here in in the triangle.
[00:07:26] ODELL:
I love that. Yeah. We're very aligned on that, philosophy. As I said, I'd I grew up on New York, but devs, and then that was also part of the inspiration for Bitcoin Park and Rabbit Hole Recap and Soul Dispatch. It's easy to think like nothing's going on in Bitcoin. There's so much there's so much going on in Bitcoin. And, really, the only way, is to just get in way over your skis and just dive head first in. If you understand everything, you're probably not, focused enough is my opinion. But triangle bit devs, so anyone anyone who has a BitDevs near them has not been, should go. There's it's been amazing blossoming movement of BitDevs around the country and around the world.
If you don't have one near you, consider at least starting a social meetup. I think meetups are incredibly important. Maybe bit devs comes later. I think there's kind of an order of operations to it. We were very deliberate at Bitcoin Park. We started with the social meetup because I feel like it's a high it's a high bar to to run a run a good bit devs. The try it's called Triangle because it's Raleigh, Durham. What's the third city?
[00:08:44] Unknown:
Chapel Hill. So it's called the Research Triangle. There's there's three, universities here. There's probably an order of, popularity or notoriety. There's UNC. There's Duke. But those those orderings, I'll get it wrong because NC State is really the top university. Go Wolfpack. Those other guys, they're just hanging around.
[00:09:07] ODELL:
Do you get a lot of students? Or
[00:09:10] Unknown:
No. I wish I did. If you're out there listening to this and you're a student at NC State, please get in contact with me. We need a Bitcoin club. I've been, like, kinda prodding and looking for some some signs of life. We have the largest engineering college in the state. Fifteen minutes down the road from where I live, we need a Bitcoin club. You've got a guy here who knows stuff, hosts meetups. Happy to get in there and help you guys get something started. Do they have a Blockchain Club? I checked, several years ago. I looked online. I was trying to get something going, and I found a website that was, like, Blockchain, not Bitcoin.
And it was just like, this is what we're dealing with. I think that website has since gone down, but, I feel like the I feel like the corporate connections at the university academic system are strong, and we're gonna have to Yeah. Like everything else in Bitcoin, we're we're fighting against demand. We're gonna have to tear down the old system and rebuild a new one.
[00:10:08] ODELL:
Yeah. We saw that with, with Vanderbilt, in Nashville. We basically what we did was we we gave anyone anyone who is a Blockchain Club member, got free access to Bitcoin Park during day hours. And, basically, we we, like, targeted the leadership. They fortunately had some strong leadership on the Blockchain Club, and we we focused on explaining to them why there's Bitcoin and then there's everything else. But when they first came in with their laptops or whatever, it was just like a who's who of shit coin corporations. You know? They had, like, their ledger stickers and their like, the the best case scenario was like a Kraken sticker.
But their whole their laptops were just, like, loaded, Solana, everything. So it's a work in progress, but we'll get there. There's there's also, Arsh, who's most well known for his work, with HRF. They have some program that they're doing trying to expand Bitcoin clubs, around the country because he's a Zoomer and pretty young. So I have faith in Call me. In the youth. It's just gonna take a bit. Yeah. I'll mention it to him. Maybe I'll connect you guys after the show. But, anyway That'd be lovely. We're supposed to be talking about hash pools. I'm pretty excited about hash pools. You were at the park, some months ago, and we had some long conversations about it.
I'm a massive cashew bull. What, what are hash pools? Why should people be interested?
[00:11:52] Unknown:
Yeah. So hash pool is, kind of a new concept in, mining pools. It's a mining pool. I guess there's there's kind of there's kind of two big ideas. The first big idea is that you don't need to, have an account to run a mining pool. Ecash makes this it gives us another path. So so I guess the biggest idea of Hashpool is that, you can represent mining shares as Ecash tokens, And you can take this sort of account database that's internal to the mining pool server, and you can externalize it as this tokenized asset that people can freely trade. Not only is it just an asset, you can do this with shit coins too, but eCash is the most private and most free kind of token that you can make.
It's built on Bitcoin. It's got Bitcoin in its DNA. And I think this is where we really should be looking, when we look to decentralize the mining stack, sort of fix some of these long standing problems we've had. Another kind of key idea is that you don't need to, be a top level mining pool. You don't need to find blocks directly in order to run a mining pool. In every engineering discipline, like a layered stack, is just a a more long term resilient and and composable, technology. And our mining pool stack is not that, and we need to get there. So the idea is kind of you can, have a smallish Bitcoin club, spin up their own mining pool instance, and they actually mine up to another mining pool, higher level mining pool that's finding blocks regularly so that you don't need, like, 10 x a hash to find blocks regularly enough to stay in business.
You can build I call it a proxy pool. And this way, you find blocks regularly and your payout is smaller as it should be. But, I really wanna enable a grassroots kind of a mining pool where a Bitcoin club, person can, like, sell Bitaxes, run an ax pool instance or a hash pool instance. We can get into that into the differences a little bit. And, provide a, like, a local community mining pool for their members. And with Cashew, Cashew has not only amazing privacy, it's got amazing usability. So you could my my sort of usability defining my my guiding light is I want people to be able to buy a FedEx.
And the first question they always ask is where do I point it? Where do I mine to? And the answer should be you should mine to my pool. And then they can install a Cashew wallet, and they can watch their ecash tokens, their their sats land in their wallet, right there in real time while they're mining. That's that's the large sort of guiding light.
[00:14:37] ODELL:
Right. So when people mine Bitcoin, this on a smaller scale, the biggest issue is is something called variance. Right? This idea that payouts take a while, to happen. And because Bitcoin mining is such a ruthless cutthroat business, especially at this point in the adoption cycle. If you're not receiving rewards in a timely manner and your variance is quite law large, the hash rate could increase and your you you end up with an with an unprofitable miner. You end up making way less money, which is why people want regular payouts. And as a result of that, what we've seen is massive centralization in mining pools because people go to the largest mining pools because those mining pools have the lowest variance.
So what you're suggesting kinda solves that dilemma to a degree. And then I guess the other piece of being a small scale miner is how do you deal with small scale payouts? And Cashew is obviously ideal for that. So it kinda hits both of those. And then on top of it, it gives the users privacy. So in practice, I like this idea of, like, I mean, you called it a proxy pool. It's almost like a sub pool. You're like, the pool thinks of you as just one miner, but then there's a bunch of miners underneath that one, quote, unquote, miner that they see.
In practice, how does that where are we in development? How does that look like in practice? Like, how how hard is it for me as a operator of a meetup in Nashville spin up a proxy pool, like, spin up a hash pool? What does it look like for the user? And then do we I assume we need mining pool support, or can I just do it with, you know, ocean or slush pool without them giving me permission? Like, can I just run it without ever talking to them? They don't even know it's a hash pool running.
[00:16:44] Unknown:
You're asking the right questions. What does it look like today? You can't do it today because there's no no one has built the technology yet. So that's exactly why I'm here. And what was the second part of your question?
[00:16:59] ODELL:
What does it look like in practice for what do you I guess, since it's not built yet or it's not fully built yet, what do you expect it to look like in practice? Am I just gonna be is it could it be as simple as me running something on a start nine? Yes. Like, how accessible is the actual hash pool operation part? I assume it's hyper accessible for the the the sub miners underneath it that are just joining your pool. But what about the act because, I mean, I think if you want broad success here or scaled success, like, that part is probably gonna be the hardest piece is making it easy for people to spin up hash pools in the first place. Yeah.
[00:17:44] Unknown:
Yeah. You did ask a question about permission. Yeah. That too. Yeah. So you you you could build one of these things to hang off of an FPPS pool. I don't think it makes a lot of sense. I think PPLNS is the way to go because the crucial difference between well, there's a couple of big differences. I think most important for this discussion is that an FPPS pool assumes the the payout variance or the luck risk, and this is just another way to say that they're pricing the hash rate for you. So when you mine to an FPPS pool, they determine the price, and they give you a flat payout for each hash. A PPLNS pool pushes that pushes that luck risk and that, pricing down to you, the miner.
And I think this is what we need for that like, that's a composable stack. We can build on top of that. If you are mining on top of an an FBPS pool and, for example, you wanna do a PPLNS payout system, you're actually paying a fee upstream to the pool to price hash rate for you, and then you're producing these eCash tokens that users, individuals, can use to price hash rate as well by trading them amongst each other. So I just don't think it makes economic sense to pay upstream and then have another market under that. So to answer the question about permission, you don't need permission.
I can spin up an account at a mining pool today, any any, mining pool that doesn't require KYC information. And PPLNS, non KYC, the only game in town is Ocean. So I think we can build the stack, and I have every intention to build this hanging off of Ocean mining, which which is great because we can take all these bid access out there that are solo mining. We can take that hash rate, and we can funnel it into the best mining pool that's doing the right thing, allowing miners to mine on their own templates, and sort of, like, strike back at the at the man, which is one one one aspect that I really enjoy about this. I also wanna point out Yeah. Go on.
You mentioned earlier, the that that the payout variance makes makes small scale mining hard. I think there's actually two issues here. Payout variance is one, but we can kind of tune that. And the bigger issue is the minimum payout threshold. So if I'm mining to, one of these large monolithic mining pools, I need to earn several hundred or thousands of dollars in order to afford a payout. And on a bid access, it's just not feasible. Like you said, that the hash rate will go up before. You can never afford one of those payouts, and you're essentially
[00:20:23] ODELL:
you know, you're you're you're running slower than the the field goal is moving away from you. Because they need to pay you out on chain. So if the, like, the outputs are too small, then it's not economic it doesn't make economic sense.
[00:20:36] Unknown:
Yes. Although I'm working on something. I'm not ready to talk about it yet, but I think I have something in mind for that. But what, Ecash lets us do is we can drop this minimum payout threshold from thousands of dollars effectively down to zero or down to one sat. So you can plug your bid acts in in mine, and what happens is the Ecash mint actually receives the payout, and then you just get your ecash from the mint. And it is it is custodial. We can get into that later. I'm sure you're gonna ask some questions in that regard, but, this is how we get this is how we get one set payouts. It's it's just not feasible with any other technology.
[00:21:12] ODELL:
Yeah. I mean, the status quo the status quo is custodial anyway, so I feel like it's kind of a, you know, just strictly net net benefit.
[00:21:23] Unknown:
Right. The choice is between, a captured custodial account with a where you have to earn a large payout or, like, a custodial, private microtransaction, non account system. It's like win win win. But but their both systems are custodial.
[00:21:43] ODELL:
And then you can exit on lightning at any point at small amounts too. So doesn't require permission. So you don't need you don't need or, like, we'll use ocean as and by the way, I intentionally when I used two pool examples, I used a f FPPS pool and a p, PPLNS pool, that both didn't do KYC, as my example intentionally. Because, like, for instance, you can't mine with Foundry unless unless you have coffee with them or something. Like, they need it's, like, more than KYC. Like, you have to, like, actually, like, sit down with the suits and have a conversation. But, the FPPS pools are obviously have been way more successful lately. Right? Like, Ocean's trying to buck the trend.
So I do wonder if some people would wanna run a hash pool underneath there. I guess that, like, your concern is, like, more of, like, there's, like, an almost like an arbitrage type of situation. Obviously, you're paying them for taking on the risk, to give you the blended payouts, but I don't see it. How does that that wouldn't necessarily harm the hash pool operator. Like, that doesn't matter to them. Right?
[00:23:05] Unknown:
Like, where's the It doesn't. It makes the cost it makes the cost of it so one of the, alright. Let's back it up. When you mine a share up to a hash pool, you get an ecash token that represents that share. We're calling it ehash. So you get an ecash token. And these tokens are a futures asset, so you can trade them to each other. I can mine up some ecash. Its value in Bitcoin is not determined yet. So we have to wait some amount of time for the pool to find blocks. And once the pool finds blocks and our time window closes, now the Ehash token value is set in Bitcoin.
And until then, it floats. That's what makes it a futures instrument. So if you're building a futures instrument on top of a mining pool that's already pricing hash rate, you just pay you're just paying, like, some percentage upstream to to offer this this, pricing for you, and now we have this futures market to again, where we're already paying the piper. I just think if you stack up a hash pool built on a PP on us side by side with one built on an FPPS, you're gonna have categorically higher fees on an FPPS pool. I think it will be not competitive in the long run. You could do it. That makes sense. It's it's totally possible. I just don't think it makes economic sense. So it it
[00:24:26] ODELL:
it it so if you're mining on ocean, you actually kind of get the benefits of Yes. Because but in a free market way that you see with the large pools. Because you could actually if you wanted to not take the risk, you could just kind of I was presumably, if this is successful, there'd be, like, trading avenues where you can trade it and and not take that risk. Or you can increase your risk if you want.
[00:24:55] Unknown:
I think the default will be just mine up your ehash and you hold it, and you just wait, and it'll turn into Bitcoin automatically. And you can just DCA that way. Same as you mine anywhere else but with micropayments now. But it is possible to trade these things, and I think that's great. I'm not planning to build a marketplace. I think if there's demand, people will build their own marketplace. It probably should be a Nostril relay, Probably should have, you know, make or taker orders, but, I'm not gonna solve that problem. If you guys like the stack, you like playing with this, go out and build it, and let's free the world.
[00:25:35] ODELL:
Fair enough. I mean, that's the beauty of open interoperable protocols. So the so so in practice, this doesn't require permission. Is there any benefit if you get Ocean's blessing? Like, is there things you can do that you wouldn't be able to do otherwise if you had Ocean's blessing? Does it not even matter whatsoever? Or
[00:26:01] Unknown:
benefit? Well, I mean, they could probably make my life hard by finding ways, like, playing whack a mole.
[00:26:07] ODELL:
They can Which is, like, blocking our keys or something?
[00:26:11] Unknown:
I have no idea. I think we're all pulling in the same direction. Honestly, I hadn't thought about that question. That's interesting. I kind of assumed I've talked to the ocean guys, and, I think you while we were talking to them, so I I didn't wanna I think they could make my life a little harder or anyone's who's trying to build on their on their, mining pool. So, obviously, I would prefer to work with Ocean than against them, but as long as you have a non KYC pool that anyone can join, I'm not sure that there is gonna be an effective way that they could stop me from building on their stack. This is freedom technology. You know? It's permissionless, and I'm very much building it in that way, intentionally.
And I think Ocean is building in the same way. They're building a permissionless tech stack as well. So I don't see any reason why we why we would not get along, but, the cool thing is I don't see any way that they could really stop me. I guess they could go full KYC. That would be bad. I don't think they will.
[00:27:16] ODELL:
No. That's not gonna happen.
[00:27:18] Unknown:
Yeah. That's not gonna happen. Same.
[00:27:22] ODELL:
I mean, I think they would shut down before they went that path if they were, like, forced to or something.
[00:27:28] Unknown:
Yeah. That's why the ocean guys are awesome.
[00:27:32] ODELL:
Yeah. No. I agree. I'm right there with you. I had a great conversation with them. If for some reason you're a new listener, so dispatch, consider going back and listening. Add their entire their entire team on. They're awesome. And it seems like they're finally starting to get some real momentum. I think hash pools here could be a big addition. So one thing that Ocean has is the individual miners can choose which transactions are in their block using something called Datum, that they developed. And a bunch of their miners have opted into it. So in this situation, the person who's running the hash pool is building the block templates and deciding which transactions are in a block.
How how have you can thought about that? Is that is that just like, you know, someone trusts you. They're like, okay. I'm just gonna mind your pool. You you construct the block, or is there any transparency element there? Like, how do you think about that?
[00:28:38] Unknown:
I'm not I'm not gonna make that decision for anybody. We're gonna build the the best thing we can and push it out, and then we're gonna keep improving on it. I think long term, users should be able to pick their own block, and I and I and I hope to get there. But, like, for now, the the simplest thing to get out the door to get people hashing, on Hashpool the fastest is that the pool itself produces blocks. But, we don't wanna stay there. The the nice thing about DATM is that I I watched the DATM talk. I went to BDC plus plus last week, and I watched, Jason Hughes, discuss the DATM architecture, and it blew my mind.
Because, when we talk about proxy pools, they've already gone out and built it. I've been, like, planning this for a long time. They just went out and built it. So each DATAM gateway is a proxy pool, and they can actually daisy chain them together. So I think there is probably, some and and and a side note, Hashpool right now is built on Stratum v two tech stack. That's just where I started. It was the easiest place to start. But but all I'm keeping my options open for all of these things. I would love to roll it into the datum gateway and just have a datum hash pool.
But but we'll see. We'll see what technological decisions make sense at each stage. But there's no reason that the end user can't produce their own blocks. There's no reason you couldn't have the hash pool runner produce their blocks as well. And I think in terms of onboarding new users, we should have the proxy pool have an option where they don't have to pick their own block template. Because if you just sold a BitX to someone who's interested in getting started, they've never done anything with Bitcoin before. You're like, here. Have a have a BitX. And by the way, you need to install a Bitcoin node. You need to take a position on the latest filter debate, decide what you're gonna and produce block templates. Like, that's just too much. When I talk about solving the usability challenge, this is this is part and parcel. We gotta we gotta take the new users and guide them one step at a time.
And I think producing your block template is somewhere somewhere beyond step one in that journey.
[00:30:46] ODELL:
Fair enough. But that is interesting that, if at some point in the future, if a hash pool operator wants to further decentralize the block construction, presumably people that are actually sub users of that hash pool could actually be using data themselves and constructing blocks as kind of a powerful mind bending concept. You could have, like, a single bid ax, and you could be constructing blocks. Yeah. Why not? Kinda crazy. So we have, first of all, shout out Gary. Zapdos five thousand sets. Said, I spent most of my Zaps buying swim trunks at BTC plus plus, but here's some value for the immense value received. Thank you, Gary.
We have Itz Morrow in the live chat asking about the pros and cons of this versus the bulk 12 payout scheme that Ocean has implemented. Do you have any thoughts on that?
[00:31:47] Unknown:
Yeah. Bolt 12 is great. If you wanna do bolt 12 payouts and you have the technical acumen to set that up, you should go ahead and do that. It's not it's not very easy, and like we just said, you know, having taking a brand new Bitcoiner and asking them to set up a lightning node, I feel like it's not that like, that's the bad path. That's that's, like, step six or seven instead of step one. But you absolutely can do that. My understanding is you need to, you need to have a lightning node or lightning wallet that accepts both 12 payouts. On Ocean today, you create an account, which is just a Bitcoin address. It's a pseudonymous account. If you wanna if you wanna just take it a step further and take your rewards in bolt 12 payouts, you need to sign your bolt 12 address using the private key from your on chain address.
And, like, take a new user who you you just told about Bitcoin and explain that to them and get them up and going. You're talking about, like, a day or a week of work depending on their technical skills. But but in terms of comparing eCash with both 12 payouts, I think they're roughly equivalent in terms of privacy. I think ECash actually has better privacy, but good enough. They're they're they're close enough that it's it's you can consider them close, but basically the same. ECash enables this, futures instrument, so you can't trade your shares with other people. Although, maybe stay tuned. I think Ocean is cooking up something awesome in this vein as well.
Yeah. Does that,
[00:33:27] ODELL:
it's more I think that's a good answer. It it's hash pools have less friction for the end user. The other piece is, I mean, I think in practice, what you would probably see with most users right now with bolt 12 payouts is they're probably installing Phoenix Wallet because they're not gonna run their own node, which has bolt 12 enabled. But the problem you come into into play with is every sovereign Lightning transaction at its core is got a base on chain and has, you know Lightning is effectively, a open protocol for batch Bitcoin payments. So you have an on chain burden regardless. So you can't really receive lower threshold amounts in terms of payouts in an economically viable way.
What what ends up happening is you're gonna be keeping it with the custodian at some point along that path, whether it's Ocean or someone else. ECash, as you said, like, you can just be I can just be receiving two set payments, four set payments, 10 set payments. And then, eventually, when they hit a threshold where I can then take them to my self custody lightning, then I can then transfer them out and just makes it a much cleaner process. Yeah. Alright. Yeah. There's a great saying Phoenix doesn't work. Maybe because it's not always online.
I don't know. I haven't tested out both 12 Phoenix for both 12 ocean payouts.
[00:35:01] Unknown:
Phoenix uses this really cool DNS technology to announce your lightning address, so that might be incompatible. I think core lightning node What I've what I've heard is the core lightning is the way to go. And if there's any ocean guys in chat, please correct me if I'm wrong.
[00:35:22] ODELL:
He's saying CoinOS, but CoinOS is custodial. I don't know. Well, anyway, the point here is that there's a lot of friction. And I think the point with hash pools is that we can reduce a significant portion of that friction without putting any additional burden on the pool operators, which is already a hard business. Yeah. And then everybody wins.
[00:35:45] Unknown:
In order to get, spun up on lightning, you have to bring Bitcoin to the table. You have to have some Bitcoin already in order to open a lightning channel or pay out of band to get someone to open a channel to you. And, again, mining with a BitX, like, we're talking about brand new Bitcoiners. They don't have any Bitcoin yet. All they have is a BitX and some and a little bit of hash rate. So this really this really takes the hurdle rate to onboard someone from up here, you know, down to as low as it can possibly get.
[00:36:17] ODELL:
Yep. That makes sense to me. It's like the Lightning has a zero to one problem. You can't just start fresh unless you're using custodial. And if you're gonna use custodial cash, you ecash is the best path, in terms of trade offs and interoperability and offline payment. There's so many advantages. Okay. So where do we stand on this project? What are you thinking about timeline? How can people help? Like, how do we supercharge this? What does it look like?
[00:36:48] Unknown:
So there's three big pieces. There's issuance, which is generating the eCash tokens when a share lands. Then there's redemption, which is turning those tokens into Bitcoin when the pool finds rewards. And I think we can launch, with just those two pieces in place. The third piece, which I haven't even talked about, is verification. And we can get to that in a second. But, we're closing in on, having issuance, ready. I just got sort of a prototype working. My man Gary, average Gary in the chat, he's my number one coconspirator. He presented at, BTC plus plus an ehash, or a hash pool code tour and, claim some ehash into a browser wallet right there on stage. So it works. It's messy. We need to clean it up a lot.
There's a lot of, chewing gum and bailing wire in there. But, we're closing in on the first step, issuance. And then redemption, we've got this yeah. Salute to Gary. Redemption, we've got this, I I think I was originally thinking if you watch my talk at at BDC plus plus in Berlin, the eCash edition, I was thinking more in terms of, building my own PPLNS payout system, and now I think we can launch a proxy pool on Ocean and actually just do proportional payouts. So whenever Ocean finds a block, we just take all of the Ehash out there. We close it off. That's a tranche of Ehash, and it will now have a Bitcoin value, and those users can get paid out. So we're sort of, taking the the the the ocean block time and sort of segmenting up the eCash that way and issuing payouts that way. And I think this will be the quickest way to go live because I want people using it. I want people trading ehash and mining ehash as soon as possible, because we have to accelerate, because the clock is ticking. You know? We either build FreedomTech or we succumb to the CBDC dystopia.
So I'm just trying to find the shortest path to victory, and, I think that might be it. So I'm hopeful that issuance, we can get that going pretty quickly. Hopefully, by the end of the year. I don't know. Time lines are rough. As a software developer, everybody wants to know when's it gonna be ready in two weeks. It's an impossible question because there's unknown unknowns. Like, everything between now and the finish line is unknown unknowns. I can estimate the known knowns, but you never know what's gonna pop up. There might be some technical challenge. Yeah. Did that answer your question?
[00:39:30] ODELL:
Yeah. I guess it it did. So you mentioned you mentioned verification. What is that piece?
[00:39:39] Unknown:
Ah, verification. So this is one of the really cool things that, kind of I was thinking about this before I even decided to start building on this, and it solves a lot of problems. It seems to like, the puzzle piece just seems to naturally fit. There's this protocol called, proof of liabilities. It's really a protocol sketch that Cali published some time ago, years ago. I was reading an early draft of that, and that really got the wheels turning. But, basically, in an ECache Mint, you can collect all of these blinded messages, blinded secrets, unblinded messages, unblinded secrets, and you can, well okay. You you collect the blinded ones, and you publish a report after the e cash epoch expires. So this is when you so in an e cash mint, you have all of these, public private key pairs.
You've got the whole this whole set of them, and they each sign a a denomination of token. The a denomination is like a bill. Like, you have a $1 bill, fives, tens, twenties. In ECash, you have, bills as well. And there's a different private key that signs each bill, and that's how the Mint knows what they are. And periodically, they're gonna rotate these private keys, and that sort of closes off it's like saying we're not gonna issue any more eCash with those keys. We've got a new set of keys now. We can tap into this and publish a report of a closed epoch and all the secrets that the Mint knew about, zip them up in a Merkle tree, a Merkle sum tree so that we know that that they total up to the right amount and publish it. And anyone can come by after the fact and their wallet if their wallet supports this protocol, they'll have their secrets in their wallet that they gave to the Mint and the and the signed messages that they got back. And they can verify that all of their eCash operations with the Mint are represented.
So we have this sort of distributed, verification process. And the cool thing about Hashpool so so Cali figured all that out. He's he's a gigabrain. I love that guy. Legend among men. A legend among men. Allegedly, a man, although I won't be sure. The cool thing about Hashpool is that, we're trading shares for ecash. So we've got this proof of liabilities. We can prove all these ecash tokens. We also have mining going on on the front side, another provably verifiable process. So for every block height, we know what what block template we could mine on at that height, and we've got a share, which, adds up to this this, like, random number with a bunch of zeros at the front.
We can just publish all of this information in another Merkle sum tree, and now we've got assets on one side and liabilities on the other. We can put them put them together and publish a proof of a % of all the mining pool operations and sort of after the fact prove with with absolute fidelity that this is a fair a fairly operating mining pool. And by the way, it preserves user privacy also. I mean, if somebody knows what hashes you're mining on or what templates you're mining on, they they can probably dox you that way. But
[00:42:48] ODELL:
Because the concern is that the hash pool operator would be leaving some on the like, you would just take could take a portion of the rewards and not pay you out effectively. Right? Or I guess they could even inflate the ehash supply. Right? They could just be, generating ehash without actually doing work and inflating your but so this would solve that, or would there still be concerns with that?
[00:43:18] Unknown:
I think it totally solves it. If you read the proof of liabilities, protocol, there's a couple of gaps. Namely, we can only verify so we're relying on the users to verify their e cash on in their wallet, but I think that's okay. The the real asset
[00:43:38] ODELL:
what other people had, so I can't verify that the whole thing is correct. I can just verify that I'm getting paid proportionally.
[00:43:46] Unknown:
Right. Right. When you check your you know, when you balance checkbook, you can only know what the bank is sending you. You don't know what the bank is doing with other customers. Damn it. Where was I going with that?
[00:43:59] ODELL:
You're gonna do you require as purse it requires the individuals to verify.
[00:44:03] Unknown:
Yes. Oh, the gaps. The gaps in the protocol. So How does a high school operator fuck you?
[00:44:09] ODELL:
It's my How do they fuck you? Basically. Well,
[00:44:11] Unknown:
let's let's back up. And we're not talking hash pool. We're talking eCash Mints. So an eCash mint operator can fuck you if they, if they keep if they keep inflation under the amount of unclaimed tokens. So if I'm a mint and I issue out 100 Bitcoin worth of tokens, I'm a big I'm a big mint, and people only redeem, like, 99.9% of those, I can actually inflate that point o 1% of the money supply, and no one can detect it. Because if you add up all the eCash tokens in everybody's wallet, it adds up to 99.9 Bitcoin. And I I've actually now inflated the supply to 100.001. Nobody can prove that.
So but if you take so that's just proof of liabilities. If you now come to the other side of the table and prove assets, you can you can prove that we we received shares for that amount to this total amount of difficulty, and we issued ecash that amounts to this total amount of difficulty. So even if someone doesn't, claim those shares, if as long as my share reporting oh, yeah. You did. Okay. So I would have to selectively exclude some shares from the mining report. But here's where here's where it gets tricky for the mint operator. So if I'm mining to the Mint and I'm pushing shares up to them and they just reject some of them or they tell me that they accepted my share and don't put it in this report, I can go back later and say, hey. Hey. What happened to this share? You you gave me ecash for this share, but it's not in your report. So what like, what's going on? What's the discrepancy? Explain yourself.
In this way, we can kind of, like, we can kind of box in the mint. There's there's probably stuff they can do to cheat. Now this is a business, and it's and it's they they can always, like, reject your share. So if I go to Family Dollar and I give them a dollar and I say, I would like to buy this, if they don't give me the goods and services, they take my dollar and they'll give me the goods and services, right, this is any business can do this to you. Right. And eCash Mints are no different. But we can solve that on the social layer because, like, that's brazenly cheating. What you need to be careful about, what you need to be vigilant about is, like, hidden hidden cheating.
[00:46:33] ODELL:
Yeah. So, I mean, with this, it's a little bit different than solid inflation with a cat a regular cash human because you anyone can go and check to see how much the payouts have been on the ocean side. There can be, I guess, like, presumably, like, if I'm mining on a hash pool, right, And I'm getting ehash. Right. I'm doing, I'm doing the work. I'm getting ehash. And then it turns into ehash. It turns into actual Bitcoin or Bitcoin denominated ecash on the Bitcoin denominated side, the mint, presumably it's in the same mint. Right? Most people are gonna stay in the same mint at that point. You could solidly inflate on the Bitcoin side if you wanted to be malicious.
Right? There's no way to prove there'd be no way to prove that. I don't I don't think you could. How how would you do that? Yeah. Yeah. I think you're right to assume that it's You could just produce more you could just produce more e cash. Right? You can just silently inflate it. If if people are withdrawing, then they wouldn't know until they run the bank.
[00:47:47] Unknown:
So, with the proof of liabilities, there's a continual bank run. So you do run the bank. Every time the eCash epoch flips, you're gonna close out that old epoch. And in my view, in my vision, I think these Ecash tokens will have a time limit because, the the the mint doesn't wanna have the so so when you issue Ecash and then the epoch closes out, its its value is now determined in Bitcoin. You basically have a stablecoin out there. And we're a mining pool. We're not in a business of stablecoins. You know, stablecoins, you know, go go buy some Tether. We're not in the business of stablecoins. I want you to close these positions out, get rid of these e cash Ehash tokens and and turn it into Ecash.
So by adding a timer on on your Ehash tokens, we can force a continual bank run on the mint. So they have to zero out their liabilities in an ongoing fashion. And I I don't I've I've thought about ways to cheat. I haven't come up with a good one.
[00:48:47] ODELL:
But keep keep poking that. Like, maybe So we don't that's not live anywhere in that in regular cashew mints, this proof of liability concept. Right?
[00:48:56] Unknown:
Yeah. I don't think we've really, achieved the scale yet to make it worthwhile. ECash mints today are kind of toys. I don't put significant amounts of money in there, and you shouldn't either. This is very alpha technology. We gotta walk before we run, but I do think it's coming. I think it's inevitable.
[00:49:13] ODELL:
But so where I'm going with this is if it's actually verifiable and the Mint operator can't easily cheat you, then there's actually an incentive for larger miners to use this, not just like, bid access are the proof of concept. And that's also awesome just from, like, a Freedom Tech point of view, onboarding people know KYC Bitcoin, yada yada yada. But the big big miners have an issue where they don't know if they can trust the mining pool operator. If the mining pool is skinning off the top, it's hard to verify. Particularly if it's non ocean, it's it's hard to verify that they're they're messing with you. In this situation, it it probably actually would give them a benefit too. Right?
[00:50:00] Unknown:
Yep. I think you're exactly right. I've talked to large mining pool operators, and they constantly get this question. They spend a lot of time and resources, trying to convince their miners that they're getting a fair shake. And they'll get calls all the time that's like, hey. This share was rejected. What happened? What what about over here? We we got some rejections over here. Can you explain that? And there's no paper trail. Right now, it's it's kind of just the the trust me model, and they have to build these personal relationships to smooth things over. If you could just publish a report, publish some software, like, like river.com.
They have, quarter is it quarterly or monthly audits? They just push push it all out there, and you can verify yourself. This is where we're going. Big shout out to River. These guys are crushing it. I love what you're doing. We're gonna do the same thing in the mining pool world.
[00:50:49] ODELL:
That's awesome. I mean, I think that that I'm I'm not gonna compare and contrast which one is a bigger impact, but that could be that could be absolutely massive impact, to have more verifiability for the larger mining pools. Mining mining operators, not the pool, the, not the pool operators. Okay. So in practice, do I need, would I need a, as a user, let's say I'm a humble bit ex owner, never used Bitcoin before my life. Will I just be able to use like any, any Cashew wallet with to receive my ehash? Like, can I just use Cashew.me and just receive my ehash there and spend my ecash there? And you don't need to set up a new, you know, front facing wallet interface? Or
[00:51:43] Unknown:
Yep. That's exactly what we're shooting for. And, yeah, we so we're making it, compliant with the spec. The first design sort of, built it the way that it was the first iteration, the way it made sense in my head. I brought a PR to the CDK meetup, the Cashew DevKit meetup, and they were like, yeah. This is okay. You should, read the spec though and follow the quote design, and so we've been redesigning it. I actually read the spec. And, now it's now it's it's a pretty sweet system. So, in the new design, I want you to be able to, just have a wallet, have your BIDEX.
You you you plug in your BIDEX, you get it going, and then you don't have to talk to your BIDEX anymore. And you can just pull up your wallet on your phone and sweep the, tokens from the mint in that way. You're gonna have to have a shared secret. So when you plug up your BIDEX and and the first design is also gonna have a proxy that you have to run on your, local server, your self hosted server. So you'll you'll run so kinda like a datum gateway. You'll you'll run this app on your server. You'll point your bid acts to your own, proxy on your local network.
It actually is cashew aware, so it's doing all the wallet stuff on your home server, sending the blinded secrets, through the stratum, messaging protocol to the mining pool or the act the the the axe pool. Axe pool is what we're calling the one built on ocean. Hash pool is is sort of this other project that is not a proxy pool. It just mines blocks directly.
[00:53:21] ODELL:
Okay.
[00:53:22] Unknown:
So in axe pool, you run a in the first iteration, you run a
[00:53:27] ODELL:
a a stratum proxy on your self hosted server. You mine So it's a star nine. You're running it on, like, a star nine. Boom.
[00:53:34] Unknown:
Yes. And you plug in a shared secret, and then you have a Casio wallet. You put in the same shared secret into your wallet. And now when you mine up a share, it just lives at the mint. And you open your wallet whenever at your leisure, and it'll go to the mint, and it'll say, hey. Do you have any quotes for me? Alright. Here's the secrets. I've signed these messages. Give me my Ecash. So you can just plug and play at home and then go on to the other side of the world and just watch ehash, like, land in your wallet every time you open it up. So both sides need to be running a proxy
[00:54:07] ODELL:
on their home server, like the it's not just a hash pull operator that's running something
[00:54:15] Unknown:
or did that Yeah. In the initial design. And the reason for that is that we just need, some we just need a Cashew wallet. We have to put a Cashew wallet somewhere. I think a very, very quick follow after that is to put the Cashew wallet into the Bittax firmware. And all credit to Scott, he's building in an open source way, so we can do that. It should be a a small lift to get, to get that far. And if you go to my website, the Bittax
[00:54:40] ODELL:
So then the Bittax is the home server,
[00:54:43] Unknown:
right, basically, in that in that situation? Yes. Yes. Now you don't need to be online
[00:54:48] ODELL:
running twenty four seven. Right? Might as well just run it there. Yep. Clever.
[00:54:54] Unknown:
That's that's where we're trying to go. Yeah.
[00:54:57] ODELL:
Because then you really reduce the friction. Then all the person needs is a bid x and, you know, p w a like, Cashew.me, you could just run-in a browser. They don't even need an app. And then they're off to the races. They're good to go.
[00:55:13] Unknown:
That's the vision. If you are an engineer and you like to nerd out on stuff, go to hashpool.dev. Click on the diagrams view. I've got a bunch of mermaid diagrams where we're planning this out. If you're not an engineer, don't worry about it. It's just like boxes and text. It's gonna be boring.
[00:55:32] ODELL:
Hashpool.dev. Check it out. Yep. Hashpool.dev.
[00:55:35] Unknown:
And read the article. If you're nontechnical, go read the front page article. It it I've laid it all out in plain English. Like I said, I run a bit dev, so I like to explain everything in plain English. And if I can't, then it means I don't understand it. So, read that read that article.
[00:55:54] ODELL:
Shout out to Drew who zapped 21,000 sats. Thank you for your support, Drew. Appreciate you. What else happened? Have we is there anything else you wanna cover before we wrap here on the Hashpool side?
[00:56:13] Unknown:
We're looking for contributors. This is an open source project. There's too much work to do. I can't do it all myself. Average Gary is helping out, bringing up some more contributors. Check out my my issues page and, join the, the revolution. We're gonna fix mining from the ground up.
[00:56:32] ODELL:
Love that. While I have you, what was your thoughts on this last week in Austin? BTC plus plus, how'd that all go?
[00:56:43] Unknown:
That was amazing. Incredible. Nifty puts on an amazing conference. I saw so so so there's a lot of drama, as you know, over opera. There is, unfortunately. And there was a lot of, events and and and and stuff catering to the drama. But after it was all said and done, I went to an after party, and I saw knots I saw team knots rubbing elbows and having laughs and getting trolled and trolling team core back. So at the end of the day, I I try to I try to stay above the drama. I don't I don't think opportune is important. I don't think we should be having all these divisive knockdown drag out fights because at the end of the day, we're all Bitcoiners. We're all on the same team.
Knots nodes are Bitcoin nodes. They are building blocks and relaying transactions. Bitcoin core nodes are Bitcoin nodes. We're all in the same blockchain. So it's I mean, I could go on and on, but I don't wanna take over. I I think the BDC plus plus event brought people together, and I was very happy to see that happen. I I have mad respect for Core. I have mad respect for, Ocean and those guys and everything they're doing. They are the tip of the spear of the knots movement. And and I you know, I'm a dad times four, and it's really reminds me of when my kids fight with each other. And it's just such a tough spot to be in, and and it brings out all these complex emotions. It's like a swirling mass of anger, sadness, disappointment, frustration when your kids fight with each other. And I just wanna get my dad voice out and tell all of these people sniping at each other on social media to go to your fucking room, stop behaving like this. We're all a family together.
Think about what you've done. Behave like an adult. We can have reasonable discussions here, but sitting back and, like, sniping at at other bread corners is is net negative. Y'all are seriously you're fighting over pennies in front of a steamroller. We have we have serious problems to fix. We need to fix the mining industry. We need to, watch out for attacks on Bitcoin, and, you know, the the the knots people have some good points. My node, my filter rules, very good point. They are absolutely correct. Core people have some very good points too. If you look at it, there's a narrow band of transaction sizes where, there is no good choice to get those transactions mined. And so now we've got protocols that are doing things that are more harmful to Bitcoin in that tiny narrow band, and we're you know, the the the PR request is to close that narrow band.
And does it matter in the long run? No. It doesn't fucking matter. They're gonna do what they're gonna do. We we just need to we need to focus on the the big thing. Keep your eyes on the prize. Stop squabbling like children. Go to your room and think about what you've done, and come out when you're ready to have a reasonable debate. And that's my take on opportune. You're not gonna drag me in to one side or the other, because I'm I'm fighting for the end game here, and you should be too. That's my take on Opper Turn. Nifty put on a great show. It was amazing to watch Bitcoiners rub shoulders and and be jovial. But then, you know, the conference ended and the sniping started back up again on social media. Yeah. I mean, social
[01:00:24] ODELL:
social, it's it's a good thing you, I mean, we we started this conversation talking about meetups. Right? And social is, like, not social just brings out the worst in people, and in person does the exact opposite. So it's like it's a balancing function. And that's why I think it's important that we have more in person reaction, not less. And the front lines of that is meet ups. The large conferences kind of don't do it. But the smaller focused events, whether those are meet ups or things like b two c plus plus, which averages, like, 200 people, 250 people. That's probably, like, the upper bound where you have, like, really productive maybe it's a little bit higher, like, 500 people. It's like the upper bound where you have actual, like, productive dialogue and conversation, and people work better in that environment.
But, yeah, I would say the number one thing that I think is great that came out of this debate or drama or however you wanna put it is, I guess, a lot of people forgot the main one of the main core fundamental values of Bitcoin, which is, like, software maintainers don't dictate what you run. Like, at the end of the day, this is all open source software. You choose what you run. You could modify it if you want to. You're able to verify it yourself. And and and there's not like devs don't get to dictate how you live your life. And that's the key difference between an open source movement and an open an open protocol versus closed proprietary systems. Like, if Google changes something on fucking Gmail, like, you have to take it. You have no choice.
They will just press the update button, and you have no choice. But that is different with Bitcoin. And it's so it's good to see people starting to realize that again. The I to me, the frustrating part is there's, like, 5,000 people arguing on the Internet less. And then there's, like, a 50,000 people on the MSTR earnings calls. So there's, like, a little bit of a disconnect here, but I I'm glad people are taking sovereignty back.
[01:02:51] Unknown:
Yeah. For sure.
[01:02:54] ODELL:
Awesome. Sir, this has been a great chat. It's been a pleasure having you. I I think it would be great if we could do a follow-up at some point in the future when we're closer to production. Like, we'll update. That'd be great. So we'll stay in touch in that front. If there's anything I can do to be helpful, as always, don't hesitate to reach out. I'm I'm incredibly bullish on Ashpools. I appreciate, your work on this front. I think it's gonna be a massive, massive win, for the ecosystem. Do you have any final thoughts before we wrap?
[01:03:36] Unknown:
Thank you. Appreciate boosting my voice and my project. That's why I decided to work on this. I do think it it will be a massive win as well. We need funding. We need support. We need people to get the word out. So big thank you, and keep crushing it. Love what you're doing.
[01:03:55] ODELL:
Much love. Appreciate you. Appreciate you, freaks. Thanks for supporting the show. We'll be back next week, Monday, nineteen hundred UTC. Join us live. Civildispatch.com has all the links you need. Stay humble, sax hats. Peace.
Bill Miller IV on CNBC
Happy Bitcoin Monday
Triangle BitDevs
The Importance of Local Bitcoin Communities
Hashpools: A New Concept in Mining
Challenges and Development of Hashpools
EHash Tokens and Futures Market
Project Timeline and Call for Contributors
Technical Setup and User Experience
Open Source Collaboration and Future Plans
Reflections on BTC++ and Community Dynamics
