Citadel Dispatch

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EPISODE: 56

BLOCK: 723494

PRICE: 2272 sats per dollar

TOPICS: specter wallet, using your own node, kyc tradeoffs, liquid network, open source monetization, specter shield, el salvador, burdensome ineffective regulations

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@KeithMukai: https://twitter.com/KeithMukai

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[00:00:02] Unknown:

We are announcing the following   immediate actions.   1st,   we are broadening the scope of Canada's anti money lauder laundering   and terrorist financing rules   so that they cover crowdfunding   platforms   and the payment service providers they use.   These changes cover all forms of transactions,   including digital assets,   such as cryptocurrencies.   The illegal blockades have highlighted the fact that crowdfunding   platforms   and some of the payment service providers they use   are not fully captured under the proceeds of crime and terrorist financing act.   Our banks and financial institutions   are already obligated   to report to the Financial Transactions   and Reports Analysis Center of Canada   or FINTRAC.  

As of today,   all crowdfunding   platforms   and the payment service providers they use   must register with FINTRAC,   and they must report   large and suspicious transactions   to FINTRAC their relationships   with anyone involved in the illegal blockades   and report to the RCMP   or CSIS.   As of today,   a bank or other financial service provider   will be able to immediately   freeze   or suspend an account   without a court order.   In doing so,   they will be protected   against civil liability   for actions taken in good faith.   Federal government institutions   will have a new broad authority   to share relevant information with banks   and other financial service providers   to ensure   This is about   following   the money.  

This is about stopping the financing   of these illegal blockades.   We are today serving notice.   If your truck is being used in these illegal blockades,   your corporate accounts   will be frozen.   The insurance on your vehicle   will be suspended.   Send your semi trailers home.   The Canadian economy needs them to be doing legitimate work,   not to be illegally   making us all poor.  

[00:03:16] Unknown:

Happy Bitcoin Tuesday, freaks. It's your boy Odell here for Citadel dispatch 56.   CIL dispatch is an interactive live show about Bitcoin distributed systems, privacy, and open source software.   Wanna do a huge shout out to the freaks who continue to support the show, keeping it   free of ads and sponsors. Dispatch is a 100% audience funded, purely focused on actual Bitcoin discussion.   If you wanna support the show, you can do so at sitaldispatch.com   through either   On Chain Bitcoin or Lightning.   I also have a PayNim, which is easy to remember. It's Odell.   If you're using Samura or Sparrow Wallet, you can support me that way. Another way to support the show   is through podcasting 2 point o apps. I like fountain podcast. I like Breeze Wallet.  

Both of them are very easy to use.   You install it on your phone. You search Siddle dispatch. You press the subscribe button. You load it up with stats, then you basically choose how many sats per minute you think dispatch is worth to you. And as you listen, it streams those sats   directly to my node.   Dispatch is broadcast on Twitch, Twitter, YouTube, and Bitcoin TV dot com. All links are at sildispatch.com.   It's also available in any podcasting app.   You just search   dispatch.   So with all that said,   obviously, the intro there was some really dark times coming out of Canada.   They're using financial surveillance and financial control   to attack their political enemies,   including going after Bitcoiners because of the Bitcoin crowdfunding   attempts that are being done.  

It's a developing situation. Really hate to see it.   Free countries should be supporting monetary choice and monetary freedom.   They shouldn't be doing authoritarian   dictator style shit.   Anyway, with all that said, hopefully, we're gonna have a lighter, more enjoyable conversation. I have some 2 great guests,   joining us today.   Oh, before I get there, as always, if you wanna participate in the live discussion   as we are   doing our dispatches. The live audience is a key aspect of this show,   makes it very unique.   In a lot of ways, I feel like the live audience is a host alongside me, and you guys do make it special.  

We have a matrix chat,   which you can find the link to that at citadel dispatch.com   if you just click   citadel chat, very easy to install.   My favorite client is Element. It'll pass you through the instructions. You install Element, then you reclick the link, and you jump into the chat. And that chat is is been   popping lately. We have over 700 Bitcoiners in there even when we're not doing dispatch.   There's really, really great productive Bitcoin conversation happening in there.   Okay. So with all that said, I got 2 great guests here. We have a return guest. We have Keith Mukai. Keith, how's it going?   Hey. Happy to be here. Awesome. And, thanks for joining as as always.  

And we have Maritz. Maritz, how's it going?  

[00:06:29] Unknown:

Really good. Thank you for for having me and and Keith here.  

[00:06:33] Unknown:

So, the pleasure is all mine. It's been a long time coming. I mean,   our main conversation is gonna be Specter Wallet, which is one of my favorite Bitcoin wallets.   It's incorporated in the guides that you can find at sill dispatch.com.   I've had some of your team on before,   but I've never had you on, so I'm very excited to have a proper discussion with you on air as well.   The focus today will be using your own Bitcoin node,   using Specter Wallet, trade offs to KYC.   We have a lot of different topics we're gonna cover.   But before we do that, let's just start with high level.  

How   how do you explain what Specter Wallet is? What is Specter Wallet? Why should people care? Why should people consider using  

[00:07:19] Unknown:

it? The   the the key feature of Specter is that it really connects your hardware wallets to your,   Bitcoin core node. And, this is basically   the key feature. It makes it really easy to to use your node and not just to run it and and but really use it for for verification.   So expect that we think sort of in three levels about this. So   we think about,   your node and your verification. You should run your own node. We had,   early 2021, we had discussions if we should,   add,   Electrum   support   or connect,   to allow to connect to Electrum   and servers, and we we decided against this. We are sort of node maximalists   here, and really believe it's it's it's way easier   to to run a Bitcoin than many people think.  

Second is that we   want to encourage by default to you the user to not only run his note, but also use his own wallet infrastructure, which is part of the Bitcoin core node. And it's very powerful, especially with HWI   and,   and PSPT. You can really make great use of the wallet infrastructure. And this is a point maybe we can touch on later.   People shouldn't use the back ends of, hardware wallet, manufacturers   such as Ledger and Trezza, in my opinion, because,   addresses and x pops are sent to these infrastructures. And,   if somebody has your x pop, he knows all about your payment history and also future payments. So this is, this is not good. And finally, the third point is   not your keys,   not your not your Bitcoin. So it's about node verification. It's about wallet, your wallet infrastructure. So it's privacy   and then,   your keys, your coins, basically. And, of course, we wanna be as work with the standards, be as interoperable as possible.  

So if a user doesn't like Spectre anymore, he wants to go over to Sparrow. If somebody doesn't like Sparrow anymore, he can skip over to Spectre or to BlueWallet. So we need to offer this interoperability and,   avoid as much as possible to lock in any any Bitconers in their   in in in their in in wallet specifications or something like this.   Yes. So  

[00:09:38] Unknown:

That's I mean, I think that was a great explanation. I mean, for for starters,   to the freaks that might be maybe a tiny bit confused.   I don't think you are, but just in case,   Specter is a piece of software that you can install on your desktop.   You can install it on Linux, Mac, Windows.   You install Bitcoin Core alongside it.   So Bitcoin Core is a reference client   for Bitcoin. It it is your own node,   and it's a wallet.   If when you interact with the Bitcoin network,   you are going to need to use a node to interact with the Bitcoin network. If you're not using your own node, you're using someone else's node, and you're trusting them with   Mauriz,   insinuate   not insinuated, but alluded to when he was talking about the software that comes with your hardware wallets. If you're using, like, Ledger Live or Treasure Web Suite,   the default software that comes with those wallets.  

They will use Ledger's node or Treasure's node.   So Specter allows you to interact with pretty much every hardware wallet,   that is available,   and you can interact easily and directly with your own Bitcoin Core node.   You can do multisig. You can do single sig. It's just a very easy   UX,   for basically interacting directly with your node.  

[00:11:08] Unknown:

Exactly.  

[00:11:11] Unknown:

And now I guess and one of the cool things you added was,   and I guess this is probably a little bit before I started using Specter, so I never actually tried out this feature is Bitcoin Core is,   like,   can't they just install Spectre Wallet now and then it can automatically download Bitcoin Core as part of that process? Isn't there some kind of integration there?  

[00:11:31] Unknown:

Yes. So you can download Specter Desktop, and you have,   the possibility   to,   run Bitcoin Core,   in your Spectre desktop,   which is a great feature for people who want to have it packaged.   I'm a little bit old school. I I I have to confess I still have my Bitcoin Core software running next to my Spectre software because I really like to see,   sometimes I wanna go back into the real Bitcoin core software and see the transactions and everything, the labeling, which,  

[00:12:02] Unknown:

the Spectre desktop is doing on the Bitcoin core side. So Right. To to the communication, to the RPC calls and everything. So I really like this this double feature that is double blind sort of. From an ease of use point of view, they can just go download Specter Wallet and then, like, in that startup guide, it that, like, startup user flow, it it basically instructs you to then install a core.  

[00:12:26] Unknown:

Yes. Yes. Exactly.   So when we first came out, we we had it separately, then we packaged it. And,   it's it's it's a lot of people also, like, on the bigger page is, like, a lot of people think, oh, running a node is very complicated, and I need to   Raspberry Blitz and and, or get Umbrel and need all this hardware. It's like, it's not. If you have an old MacBook or old laptop lying around, which is not, like, completely   slow and completely broken,   you can basically   use this as as your,   node hardware to say so. And you can install your,   Bitcoin core node. You can sync it yourself. We have also a website app, which is called pruned node today   or pruned note dot today, which is maintained by our CTO, Stefan Znigarev.  

And you can download a 5 gigabyte   pruned.   And you can put this on your laptop and and run it and then put the spectra on it, and you have a dedicated laptop. And for for running this, you don't have to buy any new hardware there. And most people have a have a old   laptop   lying around, I guess.  

[00:13:34] Unknown:

So, I mean, yeah, I I would say that,   if if you want to use Lightning, then it gets a little bit more complicated because you need to have something that's always on. But if we're talking about on chain Bitcoin, we're talking about cold storage,   we're talking about your savings wallets.   Mhmm. The, you know, the cool thing is is you can literally just turn it off and turn it on on demand. You only really need to have,   Spectre and core running when you're actually interacting with your wallets. Right?  

[00:14:02] Unknown:

Yeah. So this is a point where I also would like to ask you. What what do you how do you see this? When I look at GetUnroll and all these lightning notes, and   I feel for   people have the private keys on there, for the lightning stuff. But it's for me, it feels more this is still a playground,   when you see get Umbra or Raspberry Blitz. And that it's not something where I want to run my   Bitcoin core and   and cold storage infrastructure.   So is there a difference between the cold storage   infrastructure and sort of the   hacky interesting lightning  

[00:14:41] Unknown:

new tools infrastructure for you? Or or Well, I mean, I think I think for lightning, the   the node implementations make a lot of sense,   like these little node boxes,   because once again, you wanna run it 24 or 7,   and you want it to be low power consuming.   Obviously,   they are a hot wallet in terms of lightning, so there's some security risk there. But, that's more on lightning than the actual node implementations.   Hopefully, there's, you know, some kind of advancements in terms of   having some keys cold and figuring out how to do that. But in practice, I mean, you're constantly having to change state.   You need hot keys.  

The other use case I would say is for people that are using coin join. I mean, if you're using the Whirlpool implementation,   you get free remixing, but only when you're online. So you want that to be on 247 as well. So it's through these things that are, like, 247.   I think that makes a lot of sense.   I mean, I know in my personal setup, and I don't like talking about my personal setup too much, but I'll give the freaks a little bit,   is, you know, I use a separate Bitcoin core instance for my cold storage than I do for,   Lightning.  

Mhmm. And that's just because in general, if you,   separate things,   you reduce your attack surface, and you're gonna be in a better   you're gonna be in a better situation from a privacy and security perspective.   I don't know if that's absolutely necessary.   I guess with the way Spectre is set up, it kind of makes sense because   so you alluded to it earlier.   Spectre actually   isn't it's more of a UX for Bitcoin Core. Like, the keys   are actually   like, you can see it too. Like, if you open Bitcoin Core when you're using Specter, it's they everything shows up in Bitcoin Core as if you were using Bitcoin Core as a wallet by itself.   So presumably   and I haven't done this, but my assumption would be   if you were using   so Spectre's cool that it gives you options. Right? So you we already talked about the easiest option, which I like the most, which is you're running   basically a dedicated computer with Spectre and Bitcoin Core on it.  

But you can also connect to a remote Bitcoin Core.   And if you do that, then   you're there's a private there's privacy risk because because all the all that UTXO information is on your   247   node. Right?  

[00:17:14] Unknown:

Exactly.  

[00:17:16] Unknown:

Yeah.   So these are just trade offs that people should consider and   and based on their threat model.   But I would say that if if your primary goal is, you know, strong savings,   cold storage,   it's really unnecessary to be running one of these 247 boxes, and it's just extremely it's way more user friendly and accessible than people realize just installing Spectre and following the prompts to have Bitcoin Core run alongside it.  

[00:17:45] Unknown:

It's still also like a like, I think it's important if you're a Bitcoiner coming in and you're at the Bitcoin standard and you're listening to all the great podcasts and all the podcasts and all the economics and all the macro and and whatever and excited about the software, I think it's it's quite important that at some point, you have to put away the the Twitter on your phone and switch off, like, all the noise and just,   really go and and run the node and and and get your hands a little bit dirty   and try to get a little bit more familiar with all the technical stuff that is happening if you're not coming from the developer side anyways and from technical side.  

So I I see a lot of that that people get completely   tied up in all this,   Twitter noise and all this, which is very exciting. I mean, there are, like, so many blogs and articles and podcasts every day. Like, I can't keep up with the space.   But, I think there's a important thing that you have to pause sometimes and  

[00:18:41] Unknown:

and really try to get your hands on the stuff. Yeah. You gotta jump in and get your hands dirty. That's the best way to learn.  

[00:18:47] Unknown:

Yeah. And then when you go into, like, running your own node with Spectre and maybe you want not only use it for single sick, it's very easy and good to use it with a single sick wallet, but you we actually build it for,   multi sick cold storage. So   then if you wanna,   have a setup like this and,   because you wanna protect the larger amount   of your savings in in Bitcoin,   then I recommend, like, really get familiar with the software. Have a single 6 sec setup first. Put a small amount. Test all the transactions,   and do recovery drills, and especially if you're moving to multisig. So if I'm when I moved to multisig,   like, one and a half years ago, it's really important that you,   put the keys up in a in a in a good way, that you have a plan, that you you know what you do,   and and you ease in. It's not like, oh, tomorrow I'm gonna take my, and I expect it to be done in 2 hours. No. No. No. This is like a   a thing where you have to really ease in over over time in my opinion.  



[00:19:50] Unknown:

Yeah. Take it slow.   Practice everything.   You know? Restore you wanna practice the backup restore procedure. You wanna pretend like you're in a situation where, like, devices are broken.   You wanna get really comfortable with it because when you're in an actual situation where you're trying to recover the funds, it doesn't you don't want that to be the first time you're doing it.   You're gonna scare the shit out of yourself.   You're gonna panic, and maybe you screw things up. So you wanna take it slow, but at at the same time, don't be scared about it. It's it's not as overwhelming as as one might think. Right?  

[00:20:24] Unknown:

Exactly.  

[00:20:27] Unknown:

So,   Keith, you have anything to add here?  

[00:20:31] Unknown:

Yeah. So let me just jump in. The   the node in a box,   like, you know, the umbrellas are both blessing and curse. Right? They make it so easy. You can one click install Spectre.   But when you wanna do something a little more complicated,   it makes life complicated.   So if you wanna run Spectre   outside of your Umbrel node, but you figure, hey, I'm running a full node on Umbrel, so I'll just connect my my other Spectre laptop   to my Umbrel node,   which you can do,   but Umbrel only exposes the node over Tor.   So now on your local network,   you have one machine   navigating Tor   just to get to your local network node   on Umbrel. And, you know, somebody mentioned in the comments that,   you know, Black Coffee said, I liked I really like Spectre desktop, but it got really laggy on multiple computers.  

And it depends on your setup, but   something like, you know, this   is it's kind of unexpected, you know, because in in your mind, it's really natural to just think, I'm running a node, I'm running Spectre, connect the 2, magic happens, it's great.   But it's just kind of absurd to go through the Tor step when you're all on your own local network. And so   the point where you want to be more like Moritz and pull your Spectre   off of Umbrel,   you know, because maybe you just don't have the same level of trust on in in Umbrel or in that environment,   then you really should just be running a second node,   just to make the communication quick, whether whether it's on the same laptop or a a a a node running on your local network, but just you can't connect to it over Tor. It's just it's gonna make the experience terrible.  

And there are there are places   in Spectre where   we definitely need to look at the time it takes to do these RPC calls,   when you're talking from Spectre to your node and try to make the experience better, maybe cache more in memory if we can.   But at the end of the day, we directly interface with Core. And if you're connecting over a slow connection, it's just gonna be a a miserable experience.  

[00:22:44] Unknown:

Right. And, like, the complete counterpoint is   having Core and Spectre on the same machine is is the exact opposite. Right? There's   there's there's no external communication that happened has to happen, period.  

[00:22:59] Unknown:

Right. It's gonna be as fast as that   RPC connection and your, you know, computer,   laptop CPU is gonna allow.   And then someone Lance Huddle also said, so what you're telling me is since I run a node anyway, I should delete Ledger Live and use Spectre   or anything. You can use Sparrow. You can use Spectre.   You know, I I don't   know Lance Huddle, and I don't know your level   of technical   experience, but I can speak for myself.   Like, it took me a long time to understand that my Bitcoin wasn't stuck in Ledger Live and that it wasn't stuck even on the Ledger device itself.   It was a revelation when I started using Specter   and I could import the XPUBs from my Ledger   and see all my balances. I'm like, oh my god, it's here.  

You know? And, like, I was such a noob. I'm like, how did it copy over? You know?   But, yeah, there's that's the beauty of of Bitcoin. All your value is sitting on, you know, the the the blockchain that everyone has a copy of. So,   yeah, get rid of the the corporate   spyware and just run your own node, connect your keys to it in in, basically, watch only mode, and everything is already there.  

[00:24:14] Unknown:

I would I would add that, I mean, you shouldn't,   I think Bitcoin will   I think most people that fuck around with shitcoins,   would have been better off just being humble and stacking,   sats. But, if you are if you are fucking around with shitcoins, that's probably the main reason to use Ledger Live. But if you're not and you are Bitcoin only, you should you should switch. Yes. And you should use your own node.   And like we said earlier, it is way easier than you would expect.  

[00:24:44] Unknown:

Yeah. So talking about shitcoins on on ledger or on Trezor, it's like I have a theory.   It looks like a maybe like a outlook or   conspiracy   theory. So I would say   that   these   the regulators, if they start moving forward against all these,   against Bitcoin and crypto and trying to   tie things down as we see in Canada happening also in the European Union. Is I think they will   begin to approach Ledger and Trezor and tell them,   okay, guys. You don't have the private keys, but you are actually   operating a wallet and node infrastructure,   and you're preparing transactions   and you're broadcasting   transactions. What you're actually doing, you're a payment provider,   and you're giving out these hardware tokens   to,   to your users, and you don't KYC on AML then. So   and so what I would say is, like, they will receive a lot of pressure, ledger, and trust, and others to actually KYC, AML the whole infrastructure. So if you're signing up there or you're you're   you're using this, they will ask for KYC AML,   and they will,   I think, directly report it.  



[00:25:59] Unknown:

I, you know, I mean, I tend to think that that's kind of where we're heading, especially when you see,   you know, the clip that I played in the beginning from   the Canadian government. But, the one of the good things here to keep in mind is,   because we have Spectre, because we have Sparrow, because we have Electrum and BlueWallet,   or maybe less so BlueWallet because BlueWallet uses their own Electrum server, but,   by default.   You you have the option to move at that point.   You always have the option to to move from, you know, Ledger Live or Trezza Web Suite. We have,   Yoichi Gama in in the comments asking how do we import UTXOs from Ledger. Very, very simple. You basically install Spector wallet, you follow the prompts to install Bitcoin Core,   and then you you, you click, like, add wallet and you follow the prompts on Ledger. And you plug in your Ledger, you put in your PIN, and, like, gives you this very clean UX that tells you how to connect to it.  

Same with Trezor, same with Seed Signers, same with Coldcard,   same with all of the hardware wallets. You just once you install   Specter, you just basically follow the prompts inside Specter,   to integrate   whatever wallet setup you have, whether that's multisig or single sig.  

[00:27:19] Unknown:

Exactly.   So Yeah. One more point here is, like,   I think this will be very good for Bitcoin because if you use Ledger and Trezza and you have, like, your, I don't know, 20   20 token or   cryptocurrency   portfolio there or your shitcoin portfolio,   is, like,   not a lot of people will actually   start running, I don't know, 10 different nodes for 10 different,   cryptocurrency networks. I think   if this pressure comes on, a lot of people will just run to Bitcoin and convert all their shit coins into Bitcoin and   because it doesn't   like, you you cannot as a as a home user, when you don't wanna use Ledger or or Trezza, it doesn't make any sense to to to run all these notes. Like, most people won't do it. So what the what a lot of people will do is, like, I think, go towards Bitcoin. And so this kind of pressure, this attack on on on the crypto space to say so in general   is actually good for Bitcoin and and will,   weed out, like, all these these Bitcoin   projects.  



[00:28:22] Unknown:

Yeah. I mean, I think, when we when we look at   at these types of situations, they could be bad for Bitcoiners, like individual Bitcoiners. Mhmm. But in general, if you look at the actual ecosystem, usually,   you know, Bitcoin has been referred to as an antifragile,   protocol, and and, basically, the idea is that as as it gets attacked, as these weak points get hit,   the whole system becomes more robust in response to it. And because it is free and open source software,   that anyone can run,   you don't have central centralized actors there that you can that you can push on. It's almost like a virus.   The code is out there.  

Good luck stopping its distribution   and improving.  

[00:29:06] Unknown:

Exactly.  

[00:29:09] Unknown:

So, I mean, we were talking about shitcoins,   so we can just jump right into it. Specter does offer support for one of the shitcoins, and that's, Liquid Bitcoin.   What what are you what were your thoughts on adding How do you view,   that integration? I mean, I I think,   there I mean, there aren't many liquid wallets, So it's a very Yeah. It's a very key aspect of of what Specter's offering.  

[00:29:36] Unknown:

So around   December 2021   early 2022, we were   looking at what to do next at Specter. And   we're looking at doing lightning or doing some collaborative custody solution. But then started a conversation with the Blockstream team and and Samsung   and,   wrapped our head around liquid. So,   like, the nice thing about liquid is that it doesn't   create   it it does create an a new token, but it's liquid Bitcoin. So it locks in a real   Bitcoin and uses   Bitcoin,   locked in Bitcoin as the native token.   And,   so and does does move around these liquid Bitcoin with confidential transactions, which basically, in a confidential transaction, you cannot see if liquid Bitcoin was moved or if, a stable coin was moved or   some kind of other token was moved up equity token or debt token, a block stream mining node. So you cannot see what was moved and how much was moved. But you just see the transaction there, that there's a transaction happening. So we thought that,   the liquid model fits better   the the the specter model because it's also,   like, it doesn't have to be always on. It doesn't have to be always connected like in lightning. So it fits fits the the spect approach better.  

And, we see something that is an interesting tool for Bitcoiners and, for   the the Bitcoin ecosystem as a whole.   And if something is underdeveloped, then, yeah, we like to we like to touch it and, and and and work on it because we also see a lot of back at the time already, we saw a lot of,   projects in lightning, and we're seeing a lot of things happening in lightning. So we thought, like, okay.   Liquid may be an interesting niche for us. And   it was a bit,   it was tough to integrate. It wasn't easy. We we we we were working hard with this, got great support by the Blockstream team.   And then we launched around October.  

And,   Liquid is not   very popular with,   with with Bitcorners.   We see this.   And   but I think there's   certain aspects around the confidential transactions, about around the stablecoins. Like, if you wanna touch on stablecoins,   there is a clear use case for us. People use it. People want it.   And,   it's all happening on all this economic activity around these,   stable coins is happening mostly on Ethereum and Tron. So as a Bitcoin, I don't want to see this happening on these   shitcoin networks, basically. I want to see this happening on the site on an on a on a Bitcoin native side chain,   which is clearly federated by a group of companies and organizations. But at at least it's   it's it's Bitcoin native, and it's it's it's it's looking   to to be as close to to the Bitcoin infrastructure as possible and so integrated as possible.  

So this was all I mean, I was  

[00:32:39] Unknown:

there. I was mostly teasing you with the shitcoin comment.   Thank you for,  

[00:32:44] Unknown:

I was teasing. Like, I I don't know. I think in 2019 back, we had a meeting there in, during the conference in San Francisco with,   Adam Beck, and we were I was teasing him that he's building a clown coin factory.  

[00:32:58] Unknown:

Exactly. Well, I mean, especially since it's it's   so so you can transfer this liquid Bitcoin,   which is is pegged to Bitcoin 1 to 1.   The trust model is similar to   what you would expect, like, a multisig   kind of semi custodial model where you have all these federation members,   who basically need to collude to steal the money,   has the ability to send tokens on top.   I had a really great conversation with Adam Back,   about liquid and other things. That's, still dispatch 20. If you freaks haven't listened to it and you're more curious about liquid, go check that out. That's cildespatch.com/cd20.   And then recently, I actually had 2 Venezuelan Bitcoiners on,   still dispatch 52,   And they were talking about stable coins, which can be transferred on liquid,   and and how useful they are to the Latin American population. So I think a lot of,   you know, from my perspective, Bitcoin is my stable coin. I think   on a long time scale,   it's the most, you know, stable   asset we will ever have. I think it'll trend up with adoption, but as   adoption hit starts to hit a critical mass,   it'll always increase slowly in purchasing power, but it'll become very stable.  

But in the short term, when you're looking at a lot of these developing world countries,   they they really wanna peg themselves to the US dollar. They want access to the US dollars,   and Stablecoins provide a route for them in that regard. So I guess,   Liquid could be I mean,   Specter could be a way that they could hold. Right? They can hold these these stable coins.   Yes. So Now I'm curious is Yes. The can you use   can you do multisig   liquid   on Spectre?  

[00:34:53] Unknown:

Yes.   With the Spectre hardware wallet, you can do it. I think we are working   on   Oh, because the hardware wallets themselves need to support it as well. Yes. So the the there's for for liquid hardware, we have the Jade,   but I'm not sure if it can already do multisig. I think we are we are working on that. We're or the the green team is working on that.   But with Spectre with the Spectre   DIY or the Spectre Shield, we have new device coming up.   You can use,   liquid,   multisignature   cold storage there.   And,   yeah, I wanted to yeah. This is this is something also important if you start issuing equity tokens or Bitcoin bonds and   you want to be able to hold these tokens,   in multisig or also as a company   if you wanna,   hold, like, a part of your   treasury in or, like, of your you wanna you have your Bitcoin stack and cold storage, but you want to hold some stable coin for working capital stability.  

So,   this is something also you wanna probably hold in in,   multisig,   in a liquid multisig coal storage. And And this is something I really noticed in El Salvador when I was down there in, June,   that the price went down from 60 to 30,000, and all these small,   hotels there and restaurants and everybody,   they didn't want to   accept Bitcoin anymore. And so and I was like, what's what's going on? And they basically had their working capital balance crash. Like, on the way up, everybody wanted to have Bitcoin. And on the way down, it got really, really painful for these small businesses   because, you cannot   run your little hotel without working capital stability,   which means that   you get paid in in Bitcoin, then Bitcoin price crashes, and you have to buy new supplies for your restaurant or pay your employees. So   this   we are not there yet. We need some kind of   short term stability.  

And short term stability,   well, is not especially   is what you get,   with Bitcoin. You get it to the upside over the long term, but,   running a business on on Bitcoin, if you don't have a strong capital,   how   you   say,   basis, reserve, it's it's it's really difficult. So   yeah.   So the these 2 sides are really  

[00:37:25] Unknown:

I mean, I think most Bitcoiners can relate at least, I mean, any Bitcoiner that's all in and makes money, may like, earns Bitcoin directly,   can relate to, you know, just your   your net worth dropping by 50% in a couple weeks is not never a good feeling.   So,   before we continue, so, I mean, you helped run the Adopting Bitcoin conference in El Salvador.   Right?  

[00:37:53] Unknown:

Yes. So in June, when I was there, I met with Nicolas, which is the CTO of Bitcoin Beach and,   the Gallo team.   And, I was there, and I was, like, a bit surprised that in July, there wasn't   more Bitcoin activity. We had.   We had, Mark Moss. But, basically, it was just a a bunch of 20 Bitcoiners there, and so we   started talking about what what can be done. And one thing was that,   for the Aaron, Nicola, and me, we set up the Bitcoin meetup in in San Salvador and really kick started this, but he we also did this to have a   to meet the local Bitcoiners, which was helpful for Aaron, but also   to to to prepare the ground for a Bitcoin conference, the adopting Bitcoin conference. And what actually happened is that,   the first week we're out in, in El Zonte, and the second week,   Nicola and me, we went to to San Salvador. And through my   LinkedIn contacts,   con I'm a little bit of a LinkedIn monster there. I contacted a bunch of bankers and and and managers there in San Salvador. We had meetings with a bunch of banks there. And we came in there, and, basically,   nobody knew about what they wanna do. And they were talking one bank was talking to Ripple, actually.  

And so   I was then putting a bit more pressure on on Nikola and said, hey. We need a a conference. And then   great kudos,   huge respect to the whole,   Bitcoin Beach and Galloway team there that they actually decided to pull this off. And we had a really, really fantastic conference in November with amazing energy,   600   700 Bitcoiners,   on the ground in the Sheraton Hotel there.   And, we had a fantastic time. We had a a beach day. We had 2 day conferences with much much of a lightning focus. I would like to add a little bit more Bitcoin focus.   It's   not yet announced, but I think it will be   coming back in November to,   El Salvador, and it's gonna be  

[00:39:53] Unknown:

off the chart. It was an amazing energy lineup and the agenda was great. I mean, as someone who unfortunately couldn't make it, I was feeling some massive FOMO.   To to other people who weren't able to make it,   if you go to adopting Bitcoin if you go to bitcointv.com,   adopting Bitcoin has a channel there,   with all the talks,   highly recommend some really great content and discussions,   came out of that, that event. So thank you for running that.   What was your   I that was your first time in El Salvador. Right?  

[00:40:29] Unknown:

No. My first time was after the announcement, like, a month later. Right. And then I started talking them into it. And then my second time,   I came for the conference, like, a week before and week afterwards. We will probably also be the month in November. This time, the What was your opinion of of on the ground in El Salvador? I mean, the first country to, you know, adopt a Bitcoin nationwide.  

[00:40:51] Unknown:

Mhmm.  

[00:40:52] Unknown:

How did it feel? You know, is it did it feel like a success so far? What were the pain points? How did the average people seem to take it?  

[00:41:01] Unknown:

I mean, it feels really electric because   especially in July when you came there, like, okay. It's just really a little beach town, and we have basically 20 shops or whatever, 30 shops accepting Bitcoin there. It wasn't   it wasn't like the big big thing that we   we we see on Bitcoin Twitter.   But, and we were, like, also like, there was another reason for the conference with the bank stuff. We were really worried that the 7th September, the Bitcoin   starts in El Salvador, and basically nothing works. Everything is a shit show, and, and it didn't come like this. So the 7th September was   really successful. We can say about Chivo, what you want, but,   this it it it kinda works. And it for a government   put together  

[00:41:48] Unknown:

The low bar kinda works is is a success?  

[00:41:51] Unknown:

It's pretty it's pretty good. You know? And then in November, we came back in November, and, like, the difference was massive. You can we landed in at the airport, went to the little   restaurant store there, and could right away   pay our lunch with Bitcoin. It wasn't lightning. It was on chain, whatever, but it was already,   that. And then you go into the town, and you can go to the little pupusa,   arepa shop there   and,   and and pay there. But you also can go to McDonald's, to Starbucks, and and stuff just works. You know? And so this is, like, it's really exciting to to see this and to be the this is the first place. This is ground 0.   And,   yes. So   I think also, like, to expand a little bit on that here is, like,   a lot of people are thinking, oh,   Bukele and stuff. I think Bukele needs the Bitcoiners now way more than than than the Bitcoiners need,   Bokele or Bitcoin needs Bokele.  

He really is is betting big time on on the whole Bitcoin story.   And,   I think   he's also very dependent on his public perception and stuff. So he needs to be   well received by the Bitcoiners on Bitcoin Twitter. So I think the game theory is quite interesting there.  

[00:43:16] Unknown:

I mean, definitely for him to the extreme, but, I mean, I would say that's probably pretty consistent with the way you should look at, like, every government, every individual, every corporation.   They all need Bitcoin more than,   Bitcoin needs them. Bitcoin's bigger than any of those individuals.   Just   a complete tangent because this is awesome.   The guy, Yoshi, who asked a question earlier about Ledger   and using it with Specter has completed his onboarding process while we were having this conversation. So   Yay. I think that just goes to show it just goes to show how easy,   you guys have gotten that UX down.  

Yeah. El Salvador is a very interesting,   case study.   It definitely   it it's it's it's what you would expect,   that a challenger country, a small country would adopt Bitcoin first.   It happened sooner than I expected.   I'm curious to see if other countries start to follow suit in, like, kind of a Domino's type of way.   Obviously,   the Chivo Wallet has a lot of privacy,   and custodial concerns in terms of the government's control over it,   But,   the the key aspect there is that Chivo does interact with the greater Bitcoin Monetary Network and and the Lightning Network. And,   as a result, you can use tools like Specter in your own node or BlueWallet or Moon   to use   rather than relying on the government wallet. Like, I don't think people should be relying on that gov that government wallet. It does it does concern me a bit, and I think people should be,   it's important that as big corners, especially ones with public platforms, that we talk about the trade offs, that are inherent there,   because they are real trade offs and they are real risks to users of of that wallet. But but that is awesome. I really need to make my my pilgrimage to El Salvador. I am   a little bit ashamed of myself that I haven't done it yet,   but I I I will soon. Hopefully, I can make, the next adopting Bitcoin   conference. That would be that would be fucking fire.  



[00:45:29] Unknown:

I wanna make sure you have enough FOMO that   you you can't let us go.  

[00:45:35] Unknown:

Well,   pretty good at,   I I have a feeling you're gonna be successful at that. I mean, I got so much mambo on the last one.   Before we switch into El Salvador question,   you know, people are giving you shit in the comments about liquid integration saying you shouldn't have liquid integrated.   I think it's important for people to realize, that it is an optional feature.   And And then there's also this aspect,   I mean, we're gonna be talking about another feature that,   has been controversial. But before we get there,   you know,   Spectre is MIT licensed, which is,   one of the least restrictive open source licenses available.  

Not only can you inspect and verify the code, but you can modify, distribute, and sell it,   without any additional permission from the Spectre team.   So if there is a lot of demand for a Spectre wallet without liquid in it,   another team, a group of individuals, a single individual can can fork out liquid.   How do you so you have that option available to to you as a user. That is one of the beauties of free and open source software.   Morris, how how do you how do you view because Spector's interesting project. Right? And I I just had the seed signer   I had seed signer on, yesterday. I know Keith's involved with the seed signer project as well.  

That is also an MIT licensed product.   There's a lot of interesting different models that are going on in terms of   open source projects that are also being run for profit.   And he's he's not actually running Seed signer for profit right now, but he is considering different,   potential paths.   How do you view,   your choice of the MIT license of of having Spectre as proper free open source software with this also attempted path to monetization? Like, how do you how do you   how do you look at that?  

[00:47:35] Unknown:

So   just to explain a little bit how how we think about this. So the the Spectre,   like, core version,   which I mentioned before, is, like, your note, your verification,   your wallet infrastructure, your privacy,   your your keys, your Bitcoin. Like, this is the core feature of Spectra. And this is the should be always free and should always   put the user by default into the right direction that he   runs his own node. I mean, we will maybe add later on some, electron   feature,   but   I would like to really keep it,   by default node. And this is something where I square a little bit with Sparrow, where the default mode is more,   towards,   running,   it with a Electrum   preselected Electrum servers, I think MZ, Blockstream, Mempool, and others.  

But   I think, like, default settings really define the long term user behavior.   And then you have set up your your Spectra or your your desktop wallet. And I think then the question comes in, like,   how do you, like, as a team, maintain it, and how do you keep supporting it and and keep this wallet info experience   really great. So there are,   different ways to go forward. Like, one would be a conjoin,   integration   where Sparrow   has gone or Wasabi has gone that you,   earn money on the on the CoinJoin side,   and the the the money you earn is helping to improve,   the wallet experience.  

Or you   add add other tools,   like,   you could, integrate a TDEX or,   other other features   or services   like,   Swan Bitcoin   and   earn money through the cooperation with these companies.   And from these fees, can pay a team to support,   the desktop wallet in in in such a sense.   So,   to answer your question here, I don't really see a point in,   in forking out Spectre here because, like, the if you download Spectre and you run it by default, you don't activate any coin joint tools or services that you might wanna use to to buy or sell Bitcoin,   or Bitcoin backed loans,   features or something like this, then you you have a you have   you have a a clean free default   mode here,  

[00:50:10] Unknown:

if that if that makes Your point is it's it's optional, so there's no need to fork it.  

[00:50:15] Unknown:

Yes.   And,   like, we want to we have a we have a good group of of legit Bitcoiners working on this,   and they will will will will maintain this as,   as as we build out this   this this model.  

[00:50:31] Unknown:

Right. So the defensive position is is   we you have a solid reputation.   You have,   solid eyes looking at the code and and improving the code.   So the overwhelming majority of people will use your distribution   even if,   technically, anyone can fork it and  

[00:50:54] Unknown:

and and do what they want with it. Right? Yes. And if somebody comes along and says, like, oh, we want to fork Spectre and when we are happy to go into a discussion then to see, like, okay. How can we   provide a, like, a Spectre minimal   version or something like this? Right.   And and support this team in in in offering, which is   which has   which which which is just like the minimal minimal   OG version to say so. So but at the moment,   to be frank, we don't have the resources. We are we're working on on getting in some resources   to to to build out the team   and, and, and and and keep improving the the specter overall.  

And,   yeah. So the   Do you guys have  

[00:51:40] Unknown:

a do you guys have a public donation page?  

[00:51:44] Unknown:

We have a public donation page. It's a little bit,   we are a little bit,   on hidden on our GitHub, I guess. But if you come, go on our GitHub,   help wanted,   and there's a donation link.   And, yes. So we we we bootstrapped the thing for the last 3 years with,   Stephan's,   brainpower and low salaries and my low salaries and   lots of Bitcoin and Satoshis that I put into Spectre   to to have this wallet out there.  

[00:52:19] Unknown:

Yeah. Like   Yeah. Go on. If you look   at, you know, if you look at   what I think, biased opinion, the most important wallets in the space aside from Core, obviously,   you know, you've got Specter, Sparrow.   I would consider BlueWallet on that list. I would consider Samura on that list.   But just looking at Spectre and and Sparrow, like, those are, like, your I think your 2 best choices for your multisig, your cold storage,   that the most hardcore Bitcoiners that that should be like you know, their their default options is one of those 2.   And the Spectre   technical team,   it's Stefan   is the the giant brain doing the hardest things that are closest to Bitcoin,   that are, like, way more complicated than than I can understand.  

And then you basically have, like,   one other, you know, mostly full time developer.   I, you know, I I came into Spectre just as a open source contributor. I was like, hey, I'd I'd like it to able to do, you know, I'd like it to be able to use Tor. Do do you mind if I build Tor support? And they're like, oh my god. Please do. You know? Like, hey. Do you mind if I make it so I can plug in my USB hardware wallet? I'm, like, holy shit. Yes. Please do that. But the team is tiny. And then, you know, Sparrow, it's   just Craig. Right?  

I shouldn't have phrased it's just Craig raw   comma.   Correct?  

[00:53:43] Unknown:

He's a monster.  

[00:53:45] Unknown:

Yeah. Yeah. I mean, the guy is so prolific. Right? He's so impressive.   But and and I think he just got a grant recently from,   HRF.  

[00:53:53] Unknown:

Correct.  

[00:53:55] Unknown:

But, like,   these are 2 really important wallets   being   primarily   worked on and maintained   by, like, people you can count on one hand. Like, it it's insane. And I don't know what the the funding, the revenue model solution is.   I mean, I'm currently   community funded to do my full time seed signer work,   but   it's also   meant to be short term.   Like, I had this window of opportunity make donations work.   Yeah. Yeah. Like, I can't I can't plan the next, you know, year or 2 or 3 of my life around being community funded,   but I was able to carve out, hey. I can do the next 3 months. And if the money runs out after that,   okay, then I go find a normie job.  

But just these these super important projects are run by so few people   with, you know, shoestring or nonexistent budgets. It's it's it's mind boggling. Like, it it   I when I think about it, it makes me feel like the space is a little more vulnerable than we realize.  

[00:54:59] Unknown:

Oh, yeah. We're way more vulnerable than people realize, especially on Bitcoin Twitter.   Well, first off,   Maurice, you failed the question earlier. If people wanna donate to Spectre, you go to donate dotspector.solutions,   to support them. Consider supporting them if you like,   if if if you like their software.   The second thing is,   you know, Keith, like, I I think what's really cool   about Bitcoin, and I I find it it's a very interesting subtopic of Bitcoin, is this is this idea of monetizing,   free and open source projects.   Because Bitcoin, all of a sudden, brings in these   these new possibilities   in terms of actually,   monetizing without integrating, you know, 3rd party companies or,   centralized third parties, like, taking donations via Stripe. So, like, as much as the donation model is probably not sustainable,   it's definitely way more practical in a post Bitcoin world because, you know, you're just spinning up a BTC pay server or something. People can pay you with any Bitcoin wallet,   without KYC, without a centralized third party.  

But then on top of that,   some of these models that are being tested out,   and you mentioned Sparrow, you know,   Craig has a public donation page,   which everyone should go support him as well if you like Sparrow.   I have supported him.   The but he's also now making money from his CoinJoin integration,   And that is a a a actual very sustainable   business model   where when you do Coin Joins,   when you do coin join transactions, when you do these collaborative Bitcoin transactions,   in Sparrow Wallet, there's a fee that is paid,   and he gets a portion of it and the samurai wallet devs get a portion of it,   purely in Bitcoin. Right? So he has this Bitcoin treasury that is basically,   accumulating there. And, presumably,   if he doesn't have,   other open source contributors come in at the goodness of their heart to start contributing, he can start paying people. And that's another thing, by the way. Like, if you are a programmer, consider you know, Spectre is free free and open source software. Consider going to their GitHub. Consider contributing. Consider review.  

I'm sure Maritz and the rest of the team over there would appreciate it. So  

[00:57:20] Unknown:

do consider that. Absolutely do. Absolutely do. So we are looking at the different,   coin join implementations.   We are in discussions there for   join my cut web UI where some   some something is happening with with Jigigi and, Dennis Ryman.  

[00:57:36] Unknown:

And but we also We have a bounty for that.   The HRF I helped set up a bounty with HRF.   If if whoever comes up with   the the web UI for join market gets,   I think we're at, like, a half a Bitcoin, but don't quote me on it. I mean, join market on Whirlpool would be really cool.  

[00:57:56] Unknown:

Join market on Spectre would be really cool because I think then the the the users can actually,   generate   Bitcoin yields by providing   market making   liquidity to the to the joint market. So I think that that was really cool. But we are sort of in this whole coin joint war, especially between   Whirlpool and Vazavi, we we try to be   neutral, and we are looking at the different   implementations there.   It's a bit it's a bit difficult. And we also, like, joined the hardware wallet war. So in overall, in the hardware wallet, it's like we do respect that DIY, but for us, it was always   we wanna keep out of the these,   hardware wallet wars. And we we want to be very constructive and and and,   like, contributing to the space and not, like, get into Twitter or flame wars there.  

So   and that's why we also added, like,   all,   all hardware wallets which have reasonable traction in in in the space and are, like, not like a full shitcoin thing   only or something. So we we try to to to to   to be the neutral there. I would love to see a Vazavi   end of it, Whirlpool,   integration there. I think was a 2.0 is coming up with something there. So we would be interested in that. Plan your plan of attack is to integrate all 3, join market, Whirlpool, and Wasabi?   Then let the market decide, and then you can Whirlpool   first and wasabi later and join market finally until you have coin joint yourself out of all your Bitcoin.  



[00:59:34] Unknown:

Well, I mean, look. I like the I like the idea of Spectre being, you know, the wallet of options.   Options are good.   Bitcoin Bitcoiners,   should be happy they have more options, and they should choose the ones   that, fit their particular situation best.   But, yeah, I think Coin Sword specifically is a very interesting   revenue model for   especially because, you know, you kill 2 birds with 1 stone. You're able to bring in revenue for you,   but you're improving the privacy of your users.  

[01:00:04] Unknown:

Yes. And and, yeah, that's a that's a good point to to hit on now because, like, we,   integrated first,   with Swan Bitcoin now. So you can   stack directly from Swan Bitcoin into your Specter Wallet. And,   we   we we got some   pushback on on Twitter. So that.   And, people were saying, hey. You're an open source   wallet here. How do you square this with integrating   a KYC company like like Swan Bitcoin?   And   I think on a on a larger picture here is, like, we started working with Swan,   4 months ago, 5 months ago, 4 months ago, and it really helped us a lot to build, like, this extension   and and tool,   this extension system, which we can now use to,   add coin joints and coin market in. And it was really great working with Pablo   and with Jan from from Swan there and to see how they do things. And and and and through this   building experience, we we came to our extension model there. And on the bigger picture, I would say, is that   on the one side, as Bitcoiners, we want to hyper Bitcoinize as as fast and and defund all this clown world around us. So we want to have fast adoption.  

And on the other side, we want to be we   want to see no KYC.   And,   and if you talk no KYC, I mean,   of course, you can go with your couple of 1,000,   euros to your local meetup. And if you are in Germany and the country is relatively safe, you can go to your local meetup and you know your buddies there and you maybe somebody wants to sell. And   you can do that, or you can go to Bisco and you can go to to Huddl Huddl or something like this. But I think we will have very slow adoption if we if you if everybody would do no KYC.  

[01:02:02] Unknown:

Oh, so let's let's talk about this because this is one of the main topics I wanted to talk about,   and I'm torn on it personally. I mean, I   am probably one of the more outspoken people in the space about the dangers of KYC.   This idea that regulated Bitcoin companies are keeping lists of Bitcoiners   and our transaction history. They're keeping those lists forever. They're sharing those lists.   They're storing them in securely. Maybe they get stolen,   used by criminals,   used by governments for political persecution like we're seeing in Canada right now.   But at the same time, I,   am a man of nuance,   and I understand a lot of people are going to be coming in, through regulated on ramps.  

So, I mean, I I think there's a the multi pronged approach there. I think, 1st and foremost, you know, we should be obvious about the trade offs and risks there because most newcomers coming into the space do not even understand that there's trade offs or risks, so they can't make an informed decision to begin with.   And then secondly,   like, little things. Like, we see newcomers come in. They KYC with, like, 10 different services. They send their ID to 10 different companies   in 8 different countries,   just immediately and sign up for every service under the sun.  

Just like limiting your KYC exposure to maybe one on ramp,   you know, and then never, you know, never KYC ing with another service besides that using forward privacy tools.   So I'm a little bit torn on this debate because, actually,   I was one of the people   one of the most outspoken people pushing SWAN in this direction, which is this idea that   a onramp that is regulated has a,   responsibility   to their users   to make a UX flow   that reduces their risk to KYC as much as possible. And what do I mean by that? I mean, Swan has auto   auto buys. Right? So it's it's auto stacking instead of trading.  

So you're averaging in over time. The volatility isn't hitting you. Then they have auto withdrawals. And then but the problem with the auto withdrawals the nice thing about auto withdrawals is you don't have you have reduced custodial risk. The problem was the easiest way for them to integrate it was a fixed reused address. So anyone on chain could see that the same address was receiving, you you know, maybe $50 worth of Bitcoin a week or a $100 worth of Bitcoin a week, and they could basically assume that someone there was doing an auto DCA   probably with Swan   for a $100 a week,   and was leaking all this information.  

So then where do you go from there? Well, you can you can integrate PayNIMs, which would be awesome, which is what I wanted them to do, or you can integrate   XPUBs.   So they came up with this XPUB tool that was an open source, locally done xPub tool where you put your xPub in instead of the xPub going to their servers.   It it sends, like, the next ten addresses or something, but that was clunky. Most people weren't using it. Right? So enter the Spectre integration,   which is this idea that,   you open Spectre, you create a   I I I guess you can either create a new wallet or you can link it with an existing wallet,   and it sends 10 addresses   10 fresh addresses that haven't been used to Swan.  

And then as,   and then it reserves them within   Spector's,   UI, so you don't reuse them because you don't want you don't wanna use an address that is already linked to a KYC exchange.   And   on top of that, it doesn't have to be a hot wallet. It could be,   it it can be a hardware wallet. It could be a multisig. It could be whatever wallet you're using in Spectre.   So it is a evolution in terms of, you know, the UX and flow of   of of using a KYC service. So it's obviously a benefit there,   but you do have this inherent KYC risk that comes with it.   So, I mean, first of all, I was gonna get Maurits' opinion, but he conveniently   disconnected. I think his Internet probably cut. Hopefully, he'll join us soon. So while we're waiting for Maritz, Maritz just came back and joined us.  

And then Maritz, I was just explaining   basically the flow and the different trade offs.   I Keith, what is I mean, Keith, I know you've been working you helped work on this integration. Like, what is, like, what is your opinion here? Where do you where do you, like, how do you what's your perspective on this?  

[01:06:49] Unknown:

Yeah. I mean,   I I I totally respect the the no KYC or limit your KYC   maximalism.   I would describe myself as a pragmatist   maximalist.   And   so for existing Swan users,   the Spectre integration   is a 100% a better experience and and better for their privacy. Because as you said so there the Swan,   the normal Swan XPUB route is   you submit your XPUB to them.   Now they say it stays   in your browser and your I I guess your browser calculates,   you know, a 100  

[01:07:33] Unknown:

addresses or something. It's, like, generated locally. You can, like, inspect element if you wanna look at the code. It's open source tool or whatever.  

[01:07:41] Unknown:

Yeah. But I think Jan said that they send   it was a huge number, like, maybe, like, I don't know, 500 or something. Because I asked him what happens when,   you run out of addresses and you need to reload.   And he's like, that hasn't happened yet because they they send so many,   over the wire.   So so in this case and and look. You know, I wanna be I wanna be super clear. Like,   Jan gets all of this too. Right? It's not like he's, like, greedily trying to scoop up your your private info. Like,   he's a good actor. He's doing everything he can from his side   working for a KYC   on ramp,   to limit those those touch points. And I think, you know, he's he's doing, like, a very good   admiral job admirable job even if you find   that, like,   philosophical side of the fence disagreeable.  

But, anyway,   with the Spectre integration, like you said, we're only sending 10 addresses at most. And then each time you sign in to Spectre,   it checks your   essentially, your address balance. How many how many are still outstanding?   And it tops you up if you've received, you know, 3 auto withdrawals. And since the last time you opened Spectre, it sends 3 more to, to Swan.   So at any one point in time, Swan only has 10 of your future addresses.   And   the the previous XPUB method only worked for single sig. So it's a huge upgrade   to be able to use your own multisig cold storage. I mean, this could be your your ice cold vault that, you know, you have to travel to 5 different countries to to spend from,   and you can be stacking to that,   from Swan without any, you know, hardware wallet or or, messing with your your   storage.  



[01:09:31] Unknown:

Using your own node.  

[01:09:34] Unknown:

Yeah. Yeah. So for existing Swan users, it's a total slam dunk.  

[01:09:38] Unknown:

And even people who've been away KYC users in general, it's probably the best   KYC if you're gonna KYC, it's probably the best KYC flow that exists right now. Right?  

[01:09:49] Unknown:

Yeah. Yeah. And and something that, like, even I'm just kinda wrapping my brain around,   I haven't used the Whirlpool   integration with Sparrow,   but   I kinda feel like you should be able to have the exact same parallel wallet   in Spector and in Sparrow. And so when your Swan deposits come in,   you could just you could see them come in on the Spector side, but then open the identical wallet in Sparrow and say, hey. You know what? I wanna coinjoin those, and you've got it right there.  

[01:10:19] Unknown:

And so, I mean, you brought me to my next,   thing, which is, you know, Maurice is talking about integrating CoinJoin.   The real if you wanna talk about the real ideal   KYC flow,   we're gonna talk about is is   this idea that you have a hot wallet. You create a new Swan wallet inspector   that is only for   Swan,   you get auto withdrawals to that wallet in in fresh addresses,   and then it automatically coin joins.   And then from after it does a couple coin join rounds, you know, the user sets how many rounds they want, then it goes to your multisig cold storage   that's across 5 different continents. That would be,   like, the best flow in terms of minimizing KYC risk while still using a regulated   entity.  



[01:11:09] Unknown:

Yeah. 100%. I mean, that's that's how it should be. And if there were a 1000 hours in a day,   that that would be ready to go right now. Make it happy, Keith.   Well,   you know, in terms of so here's a pitch. In terms of funding,   like,   you know, there's like, Spectre is a tiny team.   Like, the   and I'm struggling to understand   the Whirlpool ecosystem. I've used it. I I get how the tools work, but just the I've been struggling to figure out what we would have to do to actually integrate with with Whirlpool.   And so for sure, at at some point, I'm gonna just have to have conversations with with the samurai devs and to understand this better. And with Craig because he just did it.   Right. Right. But but I think,   Craig had a little bit of an easier time because Sparrow is Java. Correct. And then the   the Whirlpool client that you can run on your own node is also Java.  

And so,   essentially, my understanding is that Sparrow   is replacing the role of that local   Java Whirlpool client that you would run, you know, that you can, like, one click install from from Umbrel.   And   and not not that it was just a copy and paste job, but, like, you know, Java to Java, he he knows how to read that code. He can kind of absorb it and and alter whatever. Made it easier.   Yeah.   Or use even some some existing libraries maybe if they're any of them are open sourced.   But, basically, we need a Python implementation   of a client that can talk to the Whirlpool servers. And as far as I know, that doesn't exist. It should exist.  

If we have to build it, we will. I want to build it. But, like, you know, right now, I'm full time seed signer. And then when I feel like I've accomplished enough during my day,   I set that aside and, like, okay. Cool. What do I wanna do inspector now? You know? Or it's, like, Saturday or Sunday. Right? Like, this is what I do for fun in my free time   on top of my, like, quote, full time job with with Seed Signer.   But if somebody out there   has the Python skills to build a Python   Whirlpool   client,   hell yeah. Bring it on. Like, we'll we'll integrate that sucker as fast as we can.  

[01:13:33] Unknown:

Yep. So this is actually   the plan going forward is that we the the flow you just described on the   from stacking into your,   coin joint cold storage is this. This is actually the flow we wanna go towards because this is also   it's not perfectly in terms of no k y c because it's not that you buy it peer to peer on a meetup or a conference or  

[01:13:57] Unknown:

like that. Still a record of you purchasing Bitcoin and how much Bitcoin and what your withdrawal address was. Yes. And,  

[01:14:04] Unknown:

like, like, if you if you do this and, as a Bitcoiner, you should assume that this kind of data leaks. And we have seen it from the from the ledger hack when they had, all the Right. Customer list hacked. Like, this Home address is name, phone number, email.  

[01:14:18] Unknown:

Yes.  

[01:14:20] Unknown:

So so   I think going forward, when the state really understands that the money is is not under his control anymore   And as we see in Canada,   I would expect, like,   I would expect, like, the this this Fintrack thing there in Canada come to Bull Bitcoin and tell Francis, like, okay. We want to have a list of all your customers,   all the email addresses, and we want to know to which Yep. To which addresses   these Bitcoin come to. So this is what I would expect, not only in Canada, but worldwide.   Especially when the when the gains are too too high   and, like, the climate change, fraud is coming, and then you have to pay a climate change solidarity tax on your Bitcoin and and about the time you huddled it. And then they look at these addresses, and they will go to the channel analysis   and just check,   okay.  

This has hopped 1, 2, or 3 times. We   have we assume that you have x amount of Bitcoin.   Please, send,   10% of these to this,   tax authority   Bitcoin address. Thank you very much. This is what I expect to come. And then you can choose if you want to keep sitting in Germany where the German supreme court already has   basically,   waived   climate change lockdowns and insanity, and the European Union is setting up a European asset registry.   And if you wanna do that, okay, you can sit in Germany and then you pay 20% on your,   corona tax or climate change tax. Or you say, okay. I'm gonna pack up, and I'm going to El Salvador or Mexico or move to Paraguay and Panama or whatever. So this is this is the choice that's coming up for a lot of people over the next 5 years.  

Or you're buying no you or you're buying okay with you at your local Bitcoin meetup?  

[01:16:13] Unknown:

Or you mine I mean, we've had   there's a lot of no k y there's a lot of discussions   on on dispatch.   Freaks who haven't listened to them in the past can go back. I mean, I'm not gonna list episode numbers because,   there's been you know, this is this is dispatch 56, and maybe we've talked about the trade offs of k y c and, like, 40 of them   45 of them.   So go listen to the archives. I mean, you can mine, you can you can earn Bitcoin, you can spend Bitcoin,   rather than   buying or selling Bitcoin. But let's keep talking about this,   this Swan integration because you guys have gotten a lot of pushback on it.  

First of all, it is optional. Right?   I I assume it's a monetization   method as well. Right? Like, you get a kickback with the Swan integration?  

[01:17:03] Unknown:

Yes. We have, like,   Swan Bitcoin has a referral system.   And, if our use like, if it's a if a Spectre user comes   and signs up for the service   through the Spectre referral link, he can support the Spectre there as we   are getting a cut out of the fees there.   And,   this is how we how we are moving forward, we,   plan to support   better wallet development and a bigger developer team to keep the the free default   system really well, like, really well set up. So this is, also a monetization. Like like,   you need you need to make money. You have to pay your bills, and you have to pay your developers, and   people have to pay rent somehow.  



[01:17:52] Unknown:

Right.   So, I mean,   right right before you guys integrated Swan I by the way, Keith, in response to my,   to the dispatch we did,   where we were discussing,   we were discussing your recent integration. I think it was,   CD 53   with   Carmen and Tony.   You mentioned that you were adding some kind of, like, warning tooltip that it's a KYC service and it comes with, you know, privacy risks. Did that ever get added? That ever get merged?  

[01:18:31] Unknown:

It's been merged.   I don't think there's been a new release. So it would be something like a 1.8dot   2. I think 1.8.1   is the current release. So whatever the next either minor or major releases, that'll be included.  

[01:18:45] Unknown:

Awesome.   I love to see when open Bitcoin discussion results in   improved product,   improved projects. It's it's really good to see. I mean, like I said, I think the number one thing,   when it comes to the risk of KYC is that these trade offs are disclosed, that users are aware that they can make their own decision. I mean, Bitcoin,   and the open source movement in general to me is a freedom movement. It's a movement of personal responsibility. It's a movement where,   ultimately,   you're gonna have many options available to you, and users should make their own informed decision on how they want to proceed. But right before,   you guys integrated Swan,   there was the AOPP   debate on Bitcoin Twitter.  

AOPP is the Address Ownership Proof Protocol.   It was designed,   based on Swiss compliance rules,   based on the travel rule, which FAFSA pushed the travel rule. FAFSA is an unelected bureaucratic organization globally,   that doesn't actually pass laws, but they have a bunch of member countries and they make,   these very strong worded,   suggestions like they did with the travel rule, and then they leave it up to individual countries to implement them.   Switzerland went above and beyond and said that any person,   using a regulated Swiss,   Bitcoin exchange   needs to sign their withdrawal addresses. Signing a withdrawal address is a native Bitcoin function.  

It's a very cool function. It's a way of proving you have ownership of an address or you have control over an address,   in a verifiable   way that is very easy for anyone to verify around the world,   without exact without exposing your private keys.   This is what   many of us have been saying that,   Craig Wright should do,   to prove at least to give some benefit of the doubt that he's Satoshi's,   you know, signed some early keys that that people presume belong to Satoshi. He refuses to do it because he's a fraud,   but,   AOPP was this idea that let's make this signing process easier,   integrate it into wallets. So instead of going through,   a little bit more cumbersome of a process,   to sign an address because a lot of wallets already offer that functionality, including Bitcoin Core,   make it easier and make it standardized.  

There's a lot of pushback against it,   most notably because   a lot of big corners, I think myself included, don't think that we should go above and beyond to comply with burdensome regulation.   It just kind of solidifies,   that regulation rather than putting pressure on the individual companies to basically then go put pressure on their governments   to say, you're completely destroying our business model. If you make them comfortable, then,   they will just proceed and the regulation will get even more burdensome over time.   Well, like, what's your viewpoint on AOPP? I know Spectre does not have it integrated.  

Do you have plans to integrate it? How how do you feel about it?  

[01:21:58] Unknown:

Yeah. So we were not part of this whole drama there because we didn't implement AOPP,   but we were   approached by   Lucas   Betchart, who's from 21 Analytics, and he's the,   I think, the head of the or, like, he's associate very closely to the Swiss Bitcoin.  

[01:22:18] Unknown:

Yeah. Him and Shift crypto were, like, leading the AOPP charge, basically.  

[01:22:22] Unknown:

And,   they were both Swift companies,   and they approached us to to add this.   But I I looked at it and then,   yes, it's like   yeah. They they they're they're doing okay with the signing at that point, and I didn't like the whole smell about it. And   then also the user didn't demand it or that we didn't see a lot of push out of of Switzerland that all our users want to use it.   And I didn't like the dynamic about it that,   this travel rule is pushed on the exchanges, and then the user has to sign this. Like, the user should just give his Bitcoin address there   and click on withdraw. And and that's the   and that's the story, basically.  

And there shouldn't be any signing circles and making things   more annoying from the UX side. And   so we have phone call or whatever. And but I sort of   we didn't move forward on that, to to put it politely, because we we didn't like it. And if you really start   thinking about this dynamic that,   FATF is basically   picking up this   message signing thing here   and,   puts puts this   wraps this into his travel rule.   If you go down this road, then it becomes really slippery because, like, what happens if the regulators   then approach Sparrow or Spector and and pushes puts a lot of pressure on us that we have to   run these travel rule,   AOPP things by default. And, you know, default settings define long term user behavior. And all of a sudden, if I send Bitcoin to Keith, Keith has to   AOPP,   basically,   his his his address to me. And then   as a next level, if you   are when when we when when we go back to the Trezor and and ledger,   discussion, which I was bringing up before,   and everybody is KYC'd   ML,   then these infrastructures of Trezor and Ledger, they can feed this back into,   let's say, European asset registry or Fintrack system in the and and and we we we we we basically blow it all away. And,   like, will it become illegal to do a non AOPP compliant transaction? So   talking to, like, regulators   and Liechtenstein,   like, if you talk to these   KYC, AML sort of specialists and who talk to the regulators,   these people are, like, really, like, pretty crazy in my opinion because they really think that they can   press this kind of travel rule stuff into   into the the Bitcoin ecosystem.  

And we have to take a stand there and say, like, okay.   And from right from the beginning, I think, is is is the way. Like, don't don't give them a little bit AOPP, and then it goes from Switzerland to Austria. And next, it's in Canada. And no. No. No. We have to be noncompliant here from from the get go.  

[01:25:31] Unknown:

So then   so so to   to to to go from there,   our conversation   in   CD 53 was   and and this is where   I mean, you dropped out a little bit, but this is why   even though I originally pushed   for,   you know, Swan   making a easy flow for people to have auto with withdraw to their own addresses,   amid the AOPP   stuff.   How do you see the difference between your SWAN integration   versus AOPP?  

[01:26:22] Unknown:

I would say, like, the   the the AOPP   puts   a technology into your wallet   that makes it very convenient   to comply with the travel rule. And at the beginning, it's just withdrawing from the exchange,   and we don't have this with Swan. And   and it and it opens the door. If you have AOPP in there and other users have AOPP, you can sort of put it into the main   wallets out there. So and this is where things becomes really tricky in my opinion.   This is this is the key thing.  

[01:27:03] Unknown:

But, like so, I mean, this was the conversation that I had with Carmen and Tony   on 53 that,   that Keith basically   picked up on, and he listened to that conversation   to add, you know, that to the   an explanation of KYC trade offs to your integration.   But my thought process was and and to be perfectly clear, like, this was something, like, I was   you know, AOPP had just kind of happened.   Well, actually, AOPP was integrated by ShiftCrypto   in their BitBox,   last year at some point.   It just hit the news because Trezor was making a big deal about integrating it, then they rolled it back. But that's why,   the debate happened was Treasure released, like, a press release that said, we're super excited that we,   cucked over to regulators.  

But, like, that conversation had just basically blown up on Bitcoin Twitter. Company, projects were pulling out of it. Companies were pulling out of it.   And then we had our conversation on dispatch.   And if you think about it, like so   first of all, AOPP is a flawed regulation to begin with, but I don't think that is even that relevant. But the reason it's flawed is because,   I when I withdraw, I can put in someone else's Bitcoin address. With AOPP, I can still do that. I can just have   Keith do the AOPP procedure for me, and then and then it goes to Keith. So it really doesn't solve anything. And, obviously, after you receive,   you can send it wherever you want to send. So it's it's a the purpose of that regulation,   it doesn't accomplish the purpose, which is this idea of proving ownership of the address.  

But that doesn't really matter because regulators will continue to push burdensome regulation that doesn't actually   improve anything anyway. So I think that is is a kind of irrelevant   distinction. But, ultimately, the idea is   try and reduce the plausible deniability   of when you withdraw, whether or not you're paying someone   or if you're sending to your own storage,   because tracking Bitcoin is is a probability game. The whole the whole way these surveillance mercenaries,   these so called chain analysis companies, these   these chain surveillance firms,   operate is they're basically doing probability analysis on every Bitcoin transaction,   trying to decide if ownership has changed. Right? Because me, I could send   to myself to a new address over and over again, and they're basically determining, am I sending it to myself, or am I sending it to Keith? Am I buying something with it? Am I sending it to an exchange? They're trying to do the probability   of when that Bitcoin changes hands. That's the key to their whole,   model. And the and the the reverse there is the key to breaking their model is to make those probabilities so low that they really have no   they have no idea of of whether or not Bitcoin is changing hands. So if you if you operate under that,   framework,   the framework of reducing plausible deniability   in this integration   or even without this integration, just the way Swan works in general with the auto withdraw, if it's a reused address or if it's an ex pub, the plausible deniability is removed. Right? You can basically assume   that if someone is using   the auto withdrawal to a fresh address,   and I imagine some kind of data is exchanged because you're getting a kickback that that they're using Spectre, so so then you really know it's sending 10 new addresses from Spectre every time you load.  

I mean, it is almost more effective than AOPP in proving   that, you know, that that it that it wasn't a payment to someone else, that it was that it is actually you taking taking control of over that Bitcoin. Right?  

[01:30:59] Unknown:

I I don't know. I   I I struggle to   to see that perspective because,   I mean, you're you're talking about the core   offering of Swan   is auto withdrawal. Right? I mean, auto auto buy with auto withdrawal.   And so Right.   Like,   the the issue is at the Swan level.   Correct. If the concern is   that it's it's a withdrawal versus a spend,  

[01:31:26] Unknown:

that's a problem inherent in the SWAN model. And The auto withdrawal model. It's the auto withdrawal model that it's a problem  

[01:31:34] Unknown:

with. Right. Right. And and you can you can have your concerns with that, but, of course, balanced against, you know, self custody. Right? And Right. You're gonna you you gotta do something from your on ramps.   But from my perspective,   so like I said, for existing users,   Swan is getting   less information. So for existing users, there's   well, I guess, Swan would know that you're you're   communicating through Spectre because the requests are coming through the API instead of the their web front end.   But, yeah, from what you what you do with it from there is up to you. And and, you know, you had said the ideal is get your auto withdrawal and then coinjoin it.   I think maybe the ideal would be to add some interim random hops in between. Right? Some mechanism that says, hey. I've got these different wallets of different types. You know, this one is nested Segwit. This one is a ancient legacy address, you know, and and over the course of the next month, do some random hops and then CoinJoin. Well, I mean, I I don't know. If regulated if regulated exchanges  

[01:32:37] Unknown:

are forced to,   freeze accounts based off of   future CoinJoin usage,   then, you know, we're in a whole different situation.   But as it stands right now, they're not. Right? So  

[01:32:50] Unknown:

Yeah. Yeah. You shouldn't even have to do that aspect to it.   Yeah. But so I don't I don't   I I view that line of criticism   as a conversation about   Swan's   auto withdrawal model,   but   I don't know what you do. Like, you know, it let's say it it's a conversation to have, but, like, you need on ramps and you need self custody.   So, you know, at that point, like, I I don't know. I   I I just want to send less information to Swan. I wanna make it easier for people to take self custody in an automated way that doesn't do dumb things like   deposit to the same address all the time or sending an entire XPUB.  

And if if the conclusion is nobody should use Swan because of its auto withdrawal model,   I just think that's a separate conversation.  

[01:33:47] Unknown:

Right.   Yeah. I mean, like, first of all,   I've been publicly discussing Bitcoin   under this identity,   for probably 4 years now, no longer than that. And I'm the first one to admit   that my perspectives change and my views change and my opinions change, and I'm proud of that. Like, I   evolve, adapt, and learn, and you can never stop learning. Like, be humble enough to know that you don't know everything, and you just need to keep,   going down the rabbit hole.   And sometimes on dispatch,   one of the reasons I love dispatch is it's a free flowing conversation. So sometimes I come to realizations   about my own thinking,   that   I hadn't considered in the past.  

And   this is why this this SWAN conversation is very interesting. Well, first of all,   I think it's pretty public that I am an adviser for SWAN, but I should probably say that, and I haven't said it yet in this conversation. So there you go.   Very, very small equity stake I got as a result of that.   Point 1% for full disclosure.   So, like, I happily will tell them to go fuck themselves on air regardless of my equity stake just for the record.   So   to me, the Swan flow was always the ideal KYC flow. Flow. If you were gonna do KYC first of all, Swan has been pretty good about,   disclosing trade offs of KYC, which once again, I think is the most important thing. They've had me on their podcast.  

Me and Gigi wrote up a whole piece on privacy best practices.   It's it's probably the only KYC service that actively has education out there for their users on the dangers of KYC.   And the auto withdraw,   I thought   was, you know, very positive for users.   I still think it's very positive users because the custodial risk is a real thing. Like, I have friends   who, you know, they use Coinbase,   you know, college friends and stuff. They use Coinbase. They listen to Rabbit Hole recap. They've listened to me every single time I get drunk scream at them,   for using custodial service. And then you just find out over a random conversation that they have, like, the majority of their Bitcoin is still on Coinbase because they,   you know, they just kinda forget about it. The price increases.  

You know? On Cash App, it's even worse. With Cash App, you you have you have these withdrawal limits   that are very, very low. So as the price increases, it's harder and harder to get your Bitcoin off of Cash App.   So they get, like, stuck in this custodial relationship out of a mix of laziness and a mix of   oversight   and just a Bitcoin price pumping and anxiety about   storage.   So the auto withdraw idea, making it as simple as possible to reduce custodial risk made a lot of sense   to me. I think it's interesting that Swan has such a good reputation in the space   has a has a pretty good reputation in the space,   at least as far as, you know, KYC onramps go.  

But AOPP got blown like, don't you think that's interesting that, like, AOPP   got blown the fuck up? But really in practice,   you know, a service offering auto withdrawals actually has way better probability   that it's going to your own   address.   Like, it's interesting.  

[01:37:21] Unknown:

I I don't know. I I feel like they're orthogonal.   You know, you could   you could AOPP an auto withdrawal   on ramp service.   It's just one is saying   there are these quasi governmental agencies   forcing you to attest to to something That's the key difference. Yeah.  

[01:37:41] Unknown:

Yeah. Because you're not complying. It's not a compliance thing. Right? It's a voluntary thing.  

[01:37:46] Unknown:

Yes.   Yes.  

[01:37:48] Unknown:

But you do agree with me that auto withdrawal proves you own the address more than AOPP does. Right?   Really. You're not gonna give that to me, Keith?   What what am I missing in that thought process? Because like I said, with AOPP, you can you can just you can just sign for me, and I can send it directly to you. But with auto withdraw   Yeah. I mean, I could it's clearly me unless I'm, like, switching out to your XPUB,   and I'm just buying the next week.  

[01:38:20] Unknown:

I mean, every week, I could manually upload a different auto withdrawal address to Swan, and it'll be like, yo, I'll pay you in a week.  

[01:38:27] Unknown:

But that's not the case with the Spectre integration. With the Spectre integration You're right. Right. That's true. Would see that. Right?  

[01:38:33] Unknown:

I I mean, even with the Spectre integration, you could create a watch only wallet.   I mean, it would be dumb, but you could give me your XPUB.   Right? I create a watch only wallet for your XPUB.   I connect my Swan auto withdrawal to that, and I'm paying you through Swan   every week.  

[01:38:51] Unknown:

Right.   But yeah. So I it's matter. Right? It's a probability game. Defaults matter and   I don't know.   There's something there.  

[01:39:00] Unknown:

It might be easier   to   fake   redirect the AOPP,   but   I   it it's like,   I don't know. The the the differences are just   I I don't know. It's like, you know, we're talking about the last, like, 0.1%   of something. I I don't know. It's not   leaping out as a huge issue or a huge, like, parallel to me.  

[01:39:27] Unknown:

Maritz, what are your thoughts here?  

[01:39:30] Unknown:

I think you're splitting hairs.  

[01:39:35] Unknown:

I think I just think it's interesting that Bitcoin Twitter, you know, like, they pick they just pick odd things to, like, draw the line on.  

[01:39:42] Unknown:

Yes. I mean, it's a it's a crazy   Bitcoin cyber hornets Twitter thing. And   you have to if if something like this blows up, you have to   remain cool and and and look what's actually being discussed and wait a couple of days or before something gets completely blown out of proportion.   But it's I think it's an important immune system we have for for Bitcoin that it's reminding people who are   working on on their projects,   if it's Swan, if it's Spector, if it's Sparrow, anybody else,   to to say, like, oh, AOPP   is is is is not really good or KYC is not the real way and and beat the drum on that no KYC thing   and, remind people that they should probably   do some home mining or   buy no KYC at,   at from friends or from from the local Bitcoin meetup or whatever   and and and go go that way because,   we don't know how   we don't know as we move forward into this information age and the Bitcoinization we see, we don't know how crazy   things will become. I mean, the whole Canada thing is going to be really interesting. Also very interesting in Austria is they introduced the capital gains tax on that, and they're putting actually pressure on the exchanges, especially the local, exchange   with Panda   to actually report,   the the and report and collect the taxes and and pay that directly to the to the tax authorities there. So things are becoming   really, really interesting. And   I could imagine that, like especially at this conversation with this KYC   adviser there and and then, like, AML guy,   in in Switzerland.  

It was interesting that they think, really, that if you, in the future, show up and want to   spend Bitcoin in, I don't know, Switzerland and wanna buy a car for €20,000   or Swiss francs,   and you can prove that   via travel rule who were the prior owners of these bitcoins and at which exchange they were bought, you cannot basically use these Bitcoin.   So there will be, like,   a KYC,   Bitcoin world and AML Bitcoin world, and there will be, like, this massive   dark pool of Bitcoin which will   continuously   keep growing. So,   I I don't know how you see this, but you see something like this coming in in US too?  



[01:42:20] Unknown:

Yeah. I mean, I tend to agree with pretty much   your prognosis there.   I I think,   you know, there's a lot of Bitcoin proponents, especially recent proponents, I would say, like the sailor school of thought, if you wanna give them a name,   that think of Bitcoin as purely an investment,   asset,   and are completely fine with using regulated custodians   and think that additional burdensome regulation,   can provide, so called regulatory clarity. So I think,   a lot of people in that camp won't be against,   all of this regulation that is almost definitely coming down the pipeline for,   companies,   specifically custodial   companies. Hopefully, not companies that are running a node for their users, but you can see it easily going down that path as well.  

And I actually think it's so perverse that, like, people talk about incentives. I mean, incentives are a key aspect to Bitcoin's,   looking at Bitcoin and and looking at the game theory of Bitcoin.   There's actually   some support there, I think, that,   you know, if if you have burdensome KYC regulation,   more identity reporting stuff, the price of Bitcoin actually short term could pump off of that half between the fact that people, you know, a lot of people will be cut out from even selling on these regulated exchanges,   but also because a lot of the people in the sailor school might think   that,   that regulatory clarity   means, you know, Bitcoin's more more likely to stay around and they pile in more.  

And I think I agree with you that the result is gonna basically be a bifurcation of the market   where you have,   a proper free market.   Some people might call it,   a black market, but I think a free market, and then you have a controlled regulated market.   But, ultimately, I think long term,   that regulation becomes so burdensome and so much friction is there,   and so many people will get burned. You know? You lose a lot of the properties of Bitcoin. You lose the censorship resistance. You even lose the seizure resistance because, you know, you end up holding it with a custodial party. I could see,   withdrawals not being allowed or only being able to withdraw to whitelist at addresses and stuff. So you lose that seizure resistance even if technically you control the private key.  

If all your holdings are completely known and they're completely tied to your   to your to your identity and your personal identifiable information,   that you know, then they put a gun to your head. They threaten you with jail time. They threaten you with heavy fines, and then they make you they make you comply. They get a couple people to comply. Most people get scared into it and just comply. But I think, ultimately, long term,   there'll be so much friction there   that that the the free market Bitcoin will win. Like, they're it'll just be such a better experience. You'll have   all the all the the features and the benefits that Bitcoin provides people in terms of censorship resistance,   seizure resistance,   inflation resistance.  

Like, you get all those benefits in the proper free market Bitcoin.   You get a   a shitty   repackaged version of them   in, you know, the regulated compliant cutbuck Bitcoin.   So I think long term, the future is bright. The question is, how many Bitcoiners get burned   in that dark period in between?   Because that dark period can get it could get really fucking bad,   and that's what that's what worries me. And and a perfect example is is this Canadian shit that's going on right now   is that,   you know, Trudeau's government has educated people on the risks   of KYC   more than any education any of us can do. And why is that? It's because when people's livelihoods are threatened,   it is the ultimate motivation.  

But the problem is is that when that point happens,   a lot of times it's already too late. Like, we talked about earlier,   like, those people are already burned now. We we talked about earlier, you know, it takes time to get comfortable with using Sovereign Bitcoin. It takes time to get comfortable with multisig.   It takes time to learn how to use privacy best practices, especially with something like CoinJoin   where you have timing analysis and stuff. You need to move slow. You're forced to move slow.   So so the question becomes how many people get burned in that immediate process? And I think that's why as an industry,   as a community, we should   be trying to build these tools, make them better,   improve the education, improve the discourse so less people get burned so that dark period isn't as bad.  

Mhmm.  

[01:47:02] Unknown:

Yeah. I was thinking today about, like, these like, imagine you're a trucker with a family and now they block your bank account and all this stuff.   And, I was still thinking, Eggman,   like, these kind of truckers,   like, I wish they had, like,   they had a moon wallet on their phone and, like, a little stack there just for this period when when they get locked out of the bank account. And I really   I mean, it's gives you a bad feeling in the stomach just thinking about this. Like like, there's so many people who get affected by this, and they haven't even understood or heard about Bitcoin and   haven't figured out all the whole shitcoin stuff. So   I think, like,   what we need to do is, like, push forward on the Bitcoin education   and push as hard as we can   forward on the fast   adoption   of of self custody   of your keys, your coins, and do the best job we can by providing no KYC tools.  

But   the priority for for for me personally,   coming also from my hardware wallet security side is, like, I want to see fast adoption,   your keys, your coins,   by the   biggest amount of people possible. And if I look around,   we have so many people coming into the space over the last 2, 3 years. And, like like, friends of yours, and they're still hanging out on fucking Coinbase. Like, what what the heck is going on? Like, is this it's it's it's it's amazing. And I I have the same experiences. I roll my eyes sometimes and think, like, guys, you   you you listening to all the,  

[01:48:37] Unknown:

plan b podcasts and and all the crazy numbers and all looking looking still at the fiat gains. And, like, it's it's ridiculous. It's Yeah. They like the engagement tweet that says that Bitcoin with dollars of fiat. It's They like the engagement tweet that Bitcoin can't be seized, and then meanwhile, their Bitcoin's sitting in Coinbase, and it can just be seized at will.  

[01:48:59] Unknown:

Yes. Yes. And this is this is the first people who will get sort of shot.   If you're sitting with your coins on a Coinbase   or on any exchange,   like, get this stuff off there. Like, if you already see it happening in Canada,   Canada, if they pull this off really now, it's gonna be such a massive shit show for so many people. Like, there's gonna be not it's gonna be   the biggest Bitcoin advertisement ever. It's gonna be the biggest Barbara Streisand effect on Bitcoin ever. It's gonna be huge.  

[01:49:31] Unknown:

Is the biggest advertisement says WikiLeaks?  

[01:49:34] Unknown:

Yes. Yes.   Easily.   Or like,   the dark dark market market was called Silk Road.   So yes. I mean and do you just to to to to talk about numbers here. Like, these are old numbers.   I don't think there are more like 4 or 5,000,000 people using actually hardware wallets. And I don't think they are, like, more than probably   20,000 people or whatever using   a a a a Vazavi, a   a mood wallet,   a sparrow, or specter. Like, probably   maybe maybe 40 or whatever. So they the the people holding their real keys on their Bitcoin only is tiny.   And the the the largest by 4, 5,000,000 people,   having a ledger, a Trezor, a hardware wallet. And then if you   look at the the amount of users on these crypto shitcoin exchanges   who are just trading Shiba coin against Yo Yo coin or whatever.  

It's it's   this is the this is the real problem we have. We have, like,   a a 100000000 people. We have to move over to your keys, your coins.   Don't listen to the shitcoin noise.   And, maybe these people are already lost. I don't know. But sorry. My rant here. But this is the This is the 100,000,000  

[01:50:51] Unknown:

you think there's a 100,000,000   people   that own Bitcoin, whether self custody or custodial?   That would be your number? Even higher.  

[01:51:00] Unknown:

I think the last number like, the old number the old number from the Cambridge research report on this cross border asset user is was, like, 2 years old is the number at least, is a 130,000,000   people have KYC accounts   on,   on on exchanges.   And I think the number now is is probably 200 or 250,000,000.   And we still  

[01:51:23] Unknown:

fuck around here with 5,000,000 people with hardware wallets and users. So is that what you think? What do you think the number is? So, like, 200 to 250,000,000   total, what do you think the number is   for, like, people that have 90% of their Bitcoin,   self custody in private Bitcoin wallets?   The number who have have most of You know, like on hardware wallets or stuff. Yeah.  

[01:51:48] Unknown:

At max, 10,000,000.   I would rather say 5.   Like, the the numbers I I was at my analysis with with,   2 years ago when I was running some numbers for our business model and doing some research, I was like   and talking to Ledger, talking to a treasurer,   we had a number, I think,   2,000,000, 3,000,000 hardware wallet users. And through the last 2 years with education, a lot of people provide and stuff. And the sales numbers, I would say, at max, 5,000,000 people.  

[01:52:19] Unknown:

5,000,000 people now have hardware wallets. We know there's at least 1,000,000 doxxed Ledger users.  

[01:52:28] Unknown:

Yes. Imagine   this fucking problem. Like, you can go on the darknet,   download this list, and I know people who have done it. And then you can go to your city, and you're in Berlin or whatever. And then you say, oh, there's Friedrich Strasse, whatever, a 100. And there's   Toby Mueller lives there, and he has a ledger. Like, I wonder why the guy has a ledger. You buy a ledger hardware wallet or something like this if you have to protect a significant amount of Bitcoin or crypto.   So we see, like, people buy this stuff from, like they start buying a hardware wallet, like, over whenever over 5 or 10000 in in crypto.  

[01:53:04] Unknown:

And Ledger doesn't even let you buy with Bitcoin is my understanding. You have to buy with credit card,   which is   frankly unacceptable.   You should I mean, they're supposed to be a Bitcoin company.   You shouldn't have to dox yourself to your surveillance corporate   card,  

[01:53:24] Unknown:

just to buy a and that's why we build Spectre DIY. You just order this developer board, and you have a little scanner, and you put in the the tables and the plugs. And that's that's that's that's that's the cool shit about it. So let's talk about let's talk about the Spectre DIY because I've talked about the seed signer many times on this show.  

[01:53:45] Unknown:

Literally, the last episode was seed signer.   I love the project.   You guys are a little bit interesting here in that you have this software   open source software project, and you have this open source Bitcoin,   open source hardware project, Inspector Do It Yourself.   What's the current state of that project?   Why should people be interested in it? I think you said you have, like, a big revamp coming on it earlier in the show.  

[01:54:09] Unknown:

Yeah. So   the long story short is, like, our CTO, Stefan, is a is a total monster, and we have, like, a nice team supporting it. And he's he's   he's amazing. The guy is, like, is massive.   And,   so we started actually out building this hardware wallet, and this is actually how spec the desktop was was coming because we were looking for   a   a companion app for our   hardware wallet. And first, we started just with a developer board and a scanner to do QR code based and SD card based stuff. And it's a nice iPhone 4 screen on a developer board, and then we added a smart card reader   and and, and,   connector board to this. So and all packaged all this in something what we call Specter Shield, which is much more for enterprise use.  

And, we really did our homework over the last years, not only building in liquid into that, but also,   working on a design that we,   we can we can ship out as a finished device. Looks a little bit like a old iPhone 4,   and has a has a nice metal casing and,   is is is in the works.   We are mostly focused here on on high net worth and enterprise usage   and,   not sure about our   retail strategy there, maybe in the future.   And,   so this is where we stand. We are currently testing production models and   hope that,   we can,   move to full production maybe later this year.  

And, yes, it's it's it's very exciting to see this developing, and we didn't take any shortcuts on the on the firmware there or anything. We have we have done a solid job developing this thing for 3 years. And the good thing is with a new device,   you can you can still use your Spectre DIY, your old one, and you can use the new Spectre,   which is coming there. And it's the same fam firmware. So you have,   a full,   MIT license, and it's   fully free and open source software.   So, we're very excited about this this coming up there. So users can you can build it yourself  

[01:56:23] Unknown:

at a it's so it's a higher price point than the seed signer. You can build it yourself with,   with off the shelf hardware.   But it's got bigger screen, higher price point than seed signer, or you can buy the prebuilt device.  

[01:56:35] Unknown:

Yes. Correct? Yes. Exactly. So, like, the seat signer,   Keith, correct me if I'm wrong, is about $40, 40, $50 when you build it. Like 60 now. Inflation. Order in bulk, I got it down to $32.   Oh,   okay. Well,   probably you'll have a, like, a,   seat signer,   bathtub full of it already.  

[01:56:58] Unknown:

Hey. Don't don't get into my personal life.  

[01:57:01] Unknown:

These children haven't taken a bath in 2 weeks because it's filled with seat signers. Exactly.  

[01:57:06] Unknown:

Yeah. So the seat signer is great. And, we were really happy when when seat signer came in and did the first stuff, and then   a lot of other drag guys jumped on it.   And and they use the embed library, which is also the library that Stepan built.   He wrote and built   the on it. And seat signer first just did just the casing for us, for Flexman, and then but then developed a seat signer out of it. And we are coming in at a higher price point. I think the developer board is €60,   or $60.   And then the scanner is, like, 30 and then another 10 for the casing and the cables. So you you're talking about, like, like, a $100 there. And it's a really, really nice, design and and really great screen and great user experience. That's my primary wallet. And I think it's for me, of course, it's the best wallet in the market, but you can ask the likes of, I don't know, maybe Michael Flexman what he thinks about this,   this device.  

And, we get some good feedback there.   So, but moving forward, like, we we we're really proud on on on what we what we did there. And,   yeah. So we got some nice Bitcoin only stuff coming up.   And,   yeah, it's great how to just to see how the whole ecosystem is growing   and,   without the   insane   without you you don't need the insane   funding that these shitcoins and shitcoin exchanges have. You can They have a lot of funding.   They have a crazy amount of funding. And it's it's like, this is something that's really puzzling to me.   Like, all these crazy shit coin projects, they have they they like, if you listen to the Solana stories and what's like, how huge this   Ethereum and Solana conferences are and what kind of money they throw around.  

And   Bitcoin is still number 1.   It's, it's building great tools. It's it has the best and the most passionate people in the space,   and it has a clear mission. It's very clear about what it wants. Like, the Bitcoin community really knows very clearly what we're working on.   And, it's just amazing   that   nobody is even close to competing with Bitcoin. It's amazing, and I and I love it.  

[01:59:22] Unknown:

Yeah. I mean, the shit corners are out there, you know, buying buying sports arenas. So   crypto.com,   no one used crypto.com.   They paid a $100,000,000   for their f one sponsorship for a single year.   I'm pretty sure.   It's it's absolutely insane, the difference in funding.   So we're almost at the 2 hour mark.   But before we do wrap up,   what about what is your thoughts on Lightning Integration inspector?   What is the is there a road map there? Is is lightning never gonna be integrated? Will it be integrated in 2 weeks? What is what is your thought process?  

[02:00:00] Unknown:

We   are not actively working on lightning.   So we think the lightning space is well alive and kicking and and is doing great. We are coming more in from the   from the on chain custody side and have chosen to   to   work on on liquid.   And, we would   we are interested in lightning. We are very passionate about lightning.   Stephan can talk to you about it until your ears bleed.   And, especially, he loves to talk about,   Bitcoin lightning security   and lightning hardware secure lightning hardware back ends.   Because   as we see the the volume and the, the network grow and and enlightening,   there are more and more security questions coming up, especially, like, where do you put the private keys when you are   managing larger amounts of of Bitcoin on lightning? And usually, they you know better than I as I sit on the on the node. And,   this is this is on the servers, on hardened servers, and this is something   which is not   not very pleasant to think about. So I think in the future   in the near future, we will need,   secure back ends for lightning and, and specifically built for lightning also so that you really can can protect these, these keys in a in a in a in a good way.  



[02:01:23] Unknown:

100%. I mean, so that's interesting. No plans really.  

[02:01:26] Unknown:

We don't we we have some HSM plans where we think about,   the the the HSM,   which can support   Bitcoin, liquid, and also lightning.   And, we would love to build this. But as we just discussed,   funding is the question. Right. And, and that's that's where we go. Right.   And priorities. You cannot do everything at the same time. You have to prioritize   what you wanna do.   But, I think we really did our homework on the Spectre   hardware wallet, which is coming up, and, we would like to put more resources on the Spectre desktop.  

[02:02:06] Unknown:

I look forward to, playing with the new hardware wallet. I do have, the original Spectre DIY.   It's a sexy piece of hardware. It's, it was definitely,   definitely feels like it was way ahead of its time.   I do a 100% appreciate all the work you and your team do.   I mean, you mentioned we've mentioned already, like, the fact that these 247   note boxes   have, you know, your hot lightning keys on it.   But if you want a really unsettling thought,   there are a lot of lightning nodes that are being run   on Canadian,   VPSs right now.   And depending on how the Canadian government wants to proceed here and how hard they go,   that should be a very interesting painful case study,   in in what is custodial risk and what isn't. Because, technically, it's not custodial,   but if you're running your node on someone else's servers,   located in a country that's hostile to Bitcoin,   it could get pretty messy pretty quickly. So it should be interesting to see how that plays out.  

Yeah. Definitely.   The big one I'm thinking of is is Luna Node because Luna Node is, like, the very low cost,   easy option of running BTC pay server, and they're a Canadian company. But, Keith, go.  

[02:03:28] Unknown:

I'm I'm running my BGC pay on   the Luna node, but   but You better move that, brother. The key. No. I control the key. What can they do? They can seize my note, my my BC pay, and they can't get any of my funds.  

[02:03:41] Unknown:

I I hopefully Just  

[02:03:43] Unknown:

Just gonna I control the key. What are they gonna do? They can they can subpoena me and throw me in jail, but they can't they can't seize it from me.  

[02:03:51] Unknown:

You know, quick note on also on the server.  

[02:03:54] Unknown:

What key No. What key you control?  

[02:03:56] Unknown:

It's just it's running off of a a watch only XPUB.   No. That's the on chain portion, not the lightning portion. Yeah. No. I I don't I can't deal with lightning. I I can't. Okay. But I but I have to deal with the brain space.  

[02:04:08] Unknown:

And then specifically Lightning   Lightning hot wallets on Right. Right. On Lumen.  

[02:04:13] Unknown:

But no. For for lightning integration,   you know, I think it's just it's such a big space. There's so much to learn that it would, you know, it would just be a huge time suck.   But,   as as Moritz had mentioned earlier,   the 80 like, it was basically 80% of the Swan integration   was to build   a flexible   extensions   layer into   Spectre. And Swan just happened to be the first,   you know, you can think of it as a plug in into Spectre.   So I'd be really interested to hear ideas of, like, what what would make sense as an extension that would connect, like, LND   to Spectre.  

You know, like, I I don't I don't run a lightning   server, so I'm I'm you know, it's been, like, 2 years since I've played with it, so I'm pretty ignorant.   But, you know, those, like, on chain touch points that LND might have,   maybe it makes sense to tie that to a wallet inspector, and we can have a simple extension   that facilitates that communication back and forth.   That is you know, depending on what needs to be done, but something like that should be fairly straightforward where you're just saying, hey, wallet. Give me a new on chain address or,   hey. You know, let me check my, you know, I don't know, my my,   what do they call it? My submarine swap out loop out,   on chain.  

That should be straightforward.  

[02:05:38] Unknown:

I dig it.   I, yeah, look forward to seeing what extensions get added, to Spectre going forward.  

[02:05:46] Unknown:

Yeah. And and, actually, I did   I did tweet out my my trivial,   slush pool history importer as the the second extension   Slush would be great. Yeah. So it's I call it trivial because, like, I think it's awesome. I think I I I love the idea of seeing little slush pool icons in in my Spectre, you know, transaction history,   but it's trivial because slush pool just doesn't allow you to do really deep integrations.   So literally, all you can do is download   download your existing payout history   And then what this Specter extension does, it just looks at your wallet, and it looks at that that CSV file and says, hey. I recognize that address, and it just marks it as a as a slush pool deposit.  

[02:06:31] Unknown:

So it it doesn't do much, but it was kind of a proof of concept and, you know, it'll be neat to see those little icons show up. Are you guys talking to anyone at Slush? I mean, it'd be awesome. Right now, Slush has automatic withdrawals, but it's a fixed address. It'd be awesome if   if we had, like, the Swan type of integration, but with Slush where it went to a new address every time.  

[02:06:52] Unknown:

Yeah. I mean, their their API,   the the   there's a gaping hole around anything related to   payout addresses or history or anything.   And I assume that's, you know, intentional that they just don't wanna go there.   But if anyone has connections into Slush, I would I would love to have that API endpoint. I think that would be amazing.  

[02:07:14] Unknown:

Okay. I'm gonna start that conversation after   after we get off,   because I think that would be absolutely fantastic,   particularly to home miners who tend to use slush.   It is my my favorite mining pool.   Okay, guys. I mean, it's been 2 hours and 7 minutes. I think this has been an absolutely fantastic conversation.   I like to wrap it up with final thoughts.   Keith, final thoughts?  

[02:07:45] Unknown:

None. Thanks for having us. Great conversation.  

[02:07:49] Unknown:

I love you, Keith. Thanks for coming on. Maritz, final thoughts.  

[02:07:52] Unknown:

Final thought is stay paranoid.   Do yourself custody, run your notes, and,   don't comply with any of this   BS people throw at you.   And, that's my, that's my spirit at the moment, I will guess.  

[02:08:09] Unknown:

Awesome. Thank you, Maritz.   First of all, I wanna say a huge thank you to our guests. I appreciate both of you and your work. It is truly appreciated.   If you wanna support Spectre Development,   and you're a programmer, go to their GitHub, start reviewing things, contribute. I know they appreciate it. If you're not a programmer,   go to donate dotspector.solutions,   and send them some stats.   They really do it really does go a long way. I know Keith Keith, you have a donation page too, don't you? What is your donation page specifically?  

[02:08:45] Unknown:

Yeah. I'm just btcpay.keithmukai.com.  

[02:08:49] Unknown:

Boom.   Go to btcpay.keithmukai.com.   Send them some stats. It really does go a long way.   I try and model dispatch off of these open source projects. As as always, we don't have ads or sponsors.   So if you do appreciate the content here, please consider sending me some stats as well.   What else? I wanna thank all the freaks for joining us. I hope you found this conversation productive.   Special big thanks,   to the freaks who joined us in the live chat and contributed to the discussion.   Once again, you can find the link to that at citadel dispatch.com   and then clicking that citadel chat link.  

Maurice, I forgot to remind you, but we end every dispatch with a music video.   So you can either listen with us or you can leave while it's going. Love you, freaks. I'll hang in. I'll hang in.   Thanks, guys.  

[02:11:53] Unknown:

Yeah.   There's nothing in the suitable   more beautiful   than this.   Okay?  

[02:14:14] Unknown:

Appreciate you freaks.   Hope you enjoyed that conversation as much as I did.   Rabbit hole recap this week will be on Friday because Marty's traveling.   I'll see you on Tuesday for another dispatch.   I have to figure out what that conversation is gonna be. I haven't figured out yet.   What else?   If you're an open source developer, if you contribute to open source projects in the Bitcoin space,   I help facilitate an open source ticket program   for developers,   for contributors of those projects. You don't even have to be a developer. You could be someone who'd as long as you did a commit before October 1st for those projects, you get a free ticket,   to Bitcoin 2022 in Miami.  

If you go to b.tc/conference/   opendashsource,   not the best,   domain. But if you just type in b.tcspaceopensource   into DuckDuckGo, it comes up. You just press apply. Literally, just manually   approving those people.   So if you weren't aware of that, consider doing that. And if you aren't contributing to an open source project,   consider starting.   But regardless,   there is a discount code open source, which gets you 21% off.   Do not share that on Twitter. Otherwise, they will disable it because it is the highest discount you can get.   I love you all. Stay humble, Stack Sats. Cheers.