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Bottle Pay shuts down, Keepkey issue, Mark Cuban, Square, Greece

Bottle Pay shuts down, Keepkey issue, Mark Cuban, Square, Greece Hello everyone this is adam meister the bitcoinmeister the disrupt meister welcome to this week in bitcoin today is friday 13th yes it is December the 13th 2019 strong hand bitcoin is the next bitcoin offended by selling conviction holders of last resort all right we got some hardcore big pointers here today BTC Benny is coming in from Canada G is here and of course JW weathermen is in parts unknown and he he is also here so I I am pumped hello my elite friends in the chat youve been looking forward to this allstar cast for a while yesterday we bought you brought you tres mayor so check out the the archives of course but were going to talk a little bit about proof keys and as we move on in the show but what I want to bring up first is like some breaking news here that the bottle payday is discontinued now theyre theyre ending it because of kyc type of threats BTC betting can you elaborate on this yeah so from what I saw it just seems like theres some new regulations coming to infect coming into effect in early January in the UK oh hey you still got me yeah yeah yeah so there would be some regulations coming into effect in early January that would more or less cause them to need to collect an undesirable amount of debt well any data is undesirable to collect on behalf of their customers users so you know kyc AML they they need to collect a lot of stuff that they just dont want to do those unfamiliar bottle pay basically an easy way to tip on via lightning in a custodial manner and then withdraw to a noncustodial wallet if you choose yeah so rather than rather than let it happen they just opted to shut it down close the doors it is sad to see because it was a cool service I will say that if youre still looking for like a tipping type thing tip and dummy is is an alternative it wasnt quite as widely used but yeah something else to check out it is sad to see hopefully BTC pay server does something with it or they can open source the code and somebody can pick up the slack but it is the same threat gonna happen again were gonna go through the same situation where the person scared of kyc well it seemed to be you because its ukbased yeah but okay so it cant be a ukbased one now that thats it there you go thats a for now at least but uh okay JW your thoughts on this yeah so this is similar to what happened with the open node guys where they theyre you know doing smaller amounts of transactions and so a lot of us thought okay theyre gonna be able to get away with not having to do you know ky caml know your identity all of this garbage when you just want to send your buddy five bucks you dont have to upload a copy of your drivers license and give this little startup your social security number so it seems cool and then same same thing happened with open node they got to a point where the the regulatory I was they felt like it was going to be on them and so they went kyc and you know bottle pay I think is executed this much better and I think they made an honorable decision just to shut down the service because it is useless to have a service where you can only do small amounts its serving that niche and now you gotta you got to do all this regulatory stuff it just doesnt make sense so I think they made the right call there hopefully theyll theyll find a way to pivot to another jurisdiction but it does kind of show the importance of being able to do this on lightning because you know lightning is noncustodial theres a lot of problems that we could solve with custodial solutions but the thugs wont let us and thats why we have Bitcoin so thats why we have light so I you know its a shame I hope those guys figure it out it was it was cool it was the only way that I had was able to tip anybody on Twitter and not feel like an idiot that I couldnt get it figured out so hopefully hopefully other services will come along but but really if its custodial I think were gonna just continue to see this okay well I will say this about these guys great minds I hope they move to it maybe theyll be a completely another project where they dont even have to worry about government regulation that that maybe Im maybe Im wishing too much there but hey good luck to those dudes gee your any thoughts on this yeah the media thought that comes to mind is like what a loss for the UK you know anytime you have some type of disruptive technology like this like I mean how many times is the internet gonna come across right so when you have something like the internet or you know the new potential gold which you know Golds been here for tens of thousands of years people have used it you got the new potential gold you know kind of makes sense to you know potentially allow things to grow a little bit and have a little bit of a safe harbor for some of these new inventions and yeah its just kind of sad to see that theyre letting that opportunity pass by this level of like oversight into transactions is not something thats historically been there because you know people in general dealt in cash so the fact that moneys gone digital allows people to track it better but its not entirely clear that it actually like you know solves some of those problems so you know the everyone has to obey the law but its just kind of see that the law is not adjusting for the potential opportunity you know you see the same thing in New York City where theres like a lot of great startups and a lot of smart young people they should be doing stuff with crypto but some of them feel a little bit hamstrung and a little bit intimidated because in order to get a license from the government to run the dough its going to the Bitcoin license its like millions of dollars right so two people in the garage making Apple dont have a million dollars and it just it just feels like a kind of a waste on whoever the regulator is to let the opportunity go by yeah it is it is a shame yeah were gonna were gonna get to the opposite of this and what I think is sort of the opposite of this at least an article and JW you you Gordon want to actually inform me about yes that Square is paying this pseudonymous Bitcoin developer a lightning guy a grant the square crypto grant is going to z MN SC pxj obviously thats not his real name we dont really know where he is but a big corporation is paying him to work for them and this is uh this is the word where we live in now yeah absolutely and its awesome I have been paid more money as a pseudonymous person than I thought I was going to be able to over the last couple of years and its actually not that big of a deal if its a forprofit company you have to give them you have to give them some paperwork but if that paperwork isnt accurate so you have to give them a w9 form that paperwork is inaccurate it doesnt matter as long as you pay your taxes so Ive been paid from you know big companies that have given me money they they you know probably know that my real name is in JW weathermen but they dont really care thats what it says on the w9 and Ive talked to my attorneys and made sure hey its fine as long as you pay your taxes it doesnt matter the point is so they can track it but at the end of the day if you pay with you oh then youre not liable for anything right and you know theres scary language on that w9 this is you go to prison for the rest of your life or something but but thats my current understanding Im assuming that that they took the similar route and its freaking awesome because you dont have to worry about you know weirdos shown up at your house because theyre on some competing chain there was a post from Greg Maxwell not long you know about all the ways that he has been harassed and it was completely terrifying and eyeopening even to me and Im a paranoid weirdo right like I use a pen name and it still scared me so I think this is a great development I think it should happen all the time like why why do I need to know your meatbag address in order to do business with you it just doesnt make sense I I agree now the CM guy hes in Asia probably so theres no w9 involved the mist on his side I dont know what hes doing yeah international payments are a little bit different and I dont I dont even know how that its supposed to work I know Ive done it and Ive probably done it wrong I think most people thats what Im wondering how square can get away with this I mean I love that theyre doing it so I I mean Ive hired people Ive hired people out of Asia before and talked to CPAs and theyve said no theres nothing that you have to do its an expense you write it off as an expense theyre not an embargoed country and you dont have to do any paperwork between Ive never felt great about that like I still feel like someday Im gonna get audited its written to check but but that thats what Ive been told and Ive heard it from a couple of different CPAs that if theyre if theyre not a u.s.

Bottle Pay shuts down, Keepkey issue, Mark Cuban, Square, Greece

it isnt that that tracking system just kind of gets broken and you know the the time I want to use people have to handle it on their end or whatever they get their tax money so it it may have even been easier with him not being a US citizen than what Ive gone through but really its we live at a time where you can spin up a pen name like JW weathermen didnt exist ten two years ago right you can spin up a pen name you can do some you know reasonably passable work build up a reputation and you can earn a living my son will you know hes working under a pen name hes 16 hes never had any income that wasnt under his pen name so he may live his whole life where he always gets his paycheck in Bitcoin from people that dont know where he lives and you know as a father and thats great for me because I know he doesnt have to get harassed wow thats a pretty cool take man its interesting hey uh Gee and your thoughts on this dude I imagine some I didnt think Taiwan my first thought was theres some kid whos in Malaysia you know living off a u.s. level income and then with the cost basis of like a Southeast Asian country thats amazing so you know you can theres a little bit of an arbitrage there where somebody whos like really smart but theyre in a country like Malaysia or Philippines where they dont have as many opportunities they just are able to service customers in the United States and theyre making us wages but you know their costs are so low so its kind of cool and it opens up some opportunities that if theyre like local economy isnt that hot they can kind of do this type of thing you know my other thought to which Id love to get your guyss take on was I totally imagine that theres probably some smart programmers who are you know in startups and you know maybe you got other opensource projects and theyre kind of maybe two high pro file to work on Bitcoin or to work on you know potentially kind of political you know dissident type of technology so itd be kind of cool to think that you know this opens up like a larger pool of developers to develop on Bitcoin and other things that are seen as controversial oh yeah yeah thats thats a really good a good point there they that people that are known can now be unknown yeah thats BTC penny and your thoughts on any of this yeah I think they interest I think me is that what were getting to is were getting to a point where first of all this was impossible just a few years back right to have a pseudonymous person getting paid remotely not having to know who they are not having to go through the banking system it all of a sudden were in a place where you can no longer have or its possible to not have either identity politics or discrimination creep into the workplace because you dont know who the person is as its its the work speaks for itself so somebody can basically create a service or or or you know complete a job and do it well you dont know who the individual is you just pay them for what theyre doing theres no longer the the worry of oh this person didnt get the job because they are X Y or Z theres no longer that that oh its theres a wage gap because of this or this person was discriminated against for whatever reason its literally just the qualified people get the the work and so it takes that kind of identity politics out of the workplace as well and I think thats thats a great place to be where where people can achieve what they can achieve and not have to worry about that aspect of it which I dont know I just started kind of going down that line of thought recently and I find it to be an interesting one all right let me hang on a second I just you theyre still bidding I yeah Im here okay good good good JW any thoughts on 1g or Ben had to say no I mean I think theyre I think theyre spoton its a its exciting right I mean theres a lot of people that havent gotten jobs because they were white theres a lot of people that havent gotten jobs because theyre black or Indian or whatever and it is cool that thats going away and you know I think that its worse now than it was preinternet and now that we do have internet money it can be like it was way back when people just hired the person you know a hundred years ago most people were too hungry to screw over their neighbor because they didnt like the way they looked right and I think were getting back to the point where people will just pick the person that does the best work theyre not going to ask hey by the way are you white because I have some quota positive or negative and yeah its exciting thats its like its a really good development in the midst of a lot of shitty ones but but I think it can overwrite most of the ones that were worried about all right hire Malaysians and Philippine Pinos you big companies out there give them some opportunities if theyre the best dudes use Bitcoin we dont really need to know who they heck heck they are were getting into a whole new realm here now I want to check I want to thank FF 2k he sent 5 in the chat cs2 sent 10 bucks and he says in the world of technology bitcoin is alive on the internet its heart beats every 10 minutes oh yeah I like that pound that like button people if you guys got questions you can do that super chat you can type in bitcoinmeister there we will answer your questions we are all looking at that chat I want to move on to some big controversy here and I will start it off with JW that Kiki Kiki Kraken found out that Kiki is vulnerable if if you have one in your possession someone could get ahold of your Bitcoin if you dont have a passphrase on it okay no I dont want to I dont to freak anyone out like that I was not a Kiki fan for various reasons and they broke theyve been selling up for like five bucks apiece lately again if you if you keep it any possession and you and youve got a passphrase youre cool but JW your thoughts on this so Im not a big fan of hardware wallets in general I the big lesson here is not to focus on keep key because weve seen vulnerabilities released on open or for like opened Im Rodolfo Novaks company Im forget cold cart weve seen vulnerabilities for cold card in the last month or six weeks weve seen vulnerabilities and treasure over the last couple years theres been vulnerabilities in ledger and so it its not just a keep key issue these things are a bad idea fundamentally theyre a bad idea and I dont want you guys to freak out and start trying to move your coins because then youll do something asinine and screw up you got to be really careful if youve got if youve got money on one of these things take a deep breath you dont if its not connected to a device you dont have to freak out you have you know you have a reasonable amount of time several months lets say before I think that it your your likely to get burned by something but but hardware wallets they dont like in this case theres not even a secure element right so the shitty smart card that you get from your business you know to get in the front door that has the chip you know that maybe you slide into a crappy smart card reader that has a secure element on it they didnt even bother to do this with these devices but even if you did that you can go look at my Twitter feed I asked a really prominent security researcher just a couple days ago named Dan Kaminsky he did the first security review of Bitcoin actually and was one of the people that helped expose Craig Wright as a fraud I look if it did have a secure element and I throw a bunch of Bitcoin on it and sent it to you and didnt give you the information how much Bitcoin would I have to put on this just you know off the cuff to be confident you take the time to steal it right very good thought experiment and he said roughly 100 K that means that thats the first time hes ever done it right so I send him an open dime or I send him a cold card or I send him a treasure his off the cuff is it might take him 100, 000 worth of effort or you know maybe hes thinking half that because hes actually gonna take the time to do that so you know people respond and say oh well you do multisig well look its 100, 000 per device right so if theres four devices on the marketplace were talking about what maybe thirty man weeks right because these guys are really expensive theyre two hundred plus an hour guys so thirty man weeks and you have every hardware device thats out there so if youre storing if youre storing large amounts of money on this thing and youre expecting it to protect you physically its just its a security theater its not a good idea stop it but a more important problem with these things is that they usually you know the the people that buy them are buying them because theyre user friendly theyre not going to set up their own node most of the time and so you know you buy a treasure from Amazon you think youre doing the right thing you shared your Bitcoin balance and your home address with treasure thats the reality the situation and thats what people should be way more concerned about is somebody just grabbing it you know out of their drawer and stealing their Bitcoin funds okay this sounds like trace from last night he said he sat in that that last part about giving your address to treasure he brought up that same thing so my question for you JW is what should the average Joe do what should the average Joe storage protocol be so if youre storing more than 50, 000 dollars lets say us worth of Bitcoin you shouldnt use anything other than Bitcoin core and the only exception to that would be and I was forced into doing this right because I planned on writing a doc that was just gonna walk people through using Bitcoin core I did end up writing a small Python script similar to glaciar protocol so glaciar protocol is a good option Id recommend that its just hard to use its a hassle so what I did is I created Yeti cold comm its a Python script that walks you through setting up Bitcoin core you have an online and offline machine it sucks though in the sense that you do have to trust that that little bit of code that I wrote isnt doing anything malicious so its far less ideal than just being able to trust Bitcoin core but thats the best that I can offer right now what I definitely would say is you dont want anything other than Bitcoin core to be doing critical things like generating the the randomness for your seeds or your private keys like its barely trustworthy as it is learning well you put this in context theres critical code in Bitcoin core right now its being written and theres two or three developers that look at it regularly and Bitcoin core is probably a hundred times more reviewed than anything else so dont use anything else its already bad enough all right this obviously people are freaking out now but so Im going to say I obviously I know people that keep more than 50, 000 on Tresor and everything and but hes a were not all gonna agree on this stuff so G your take yeah I think I mean it this is so tough so you know one of the things that that comes to mind for me is theres been several of these like situations where this pops up and you know you have the wallet and you feel like okay well now Im a target right there was a I think its just confusing right because you know the risk is if you go to upgrade in the process of upgrading or switching things around like JW brought up you could actually misplace your Bitcoin right because youre in a mad rush youre confused you know people knowing that like for example when electrum was targeted like two years ago people knew that electrum had an error so then people would post like fake electrum kind of web pages for you to go to and kind of target you in that way and thats thats like the risk and and so I think theres just mass confusion so I think the question for for JW is like how should we think about wallets all right like you know theres so many different types of hardware wallets theres ledger theres treasure lets lets say Mozart so like what are the what are the kind of axes of security that you think about like one would be for example how complicated is the device or you know has it been used to kind of even to just start to judge right its its a really good question so the fundamental problem is that the best that we can do like the best that humanity can do to create a device that you physically have access to and is unhackable is these secure elements these secure elements are not even close to unhackable so in that thread Dan Kaminsky explained that he would use tempest which means he would take that device hed put it in a rig that listens to all the electromagnetic chatter that comes off the device when its crunching numbers we dont have any technology to do that or to prevent that humanity is just not capable of that so the problem with hardware wallets when they are marketed and when theyre presented to people as if somebody gets this device they cant take your point is that its just fundamentally untrue it also highlights why bitcoin itself is kind of incredible and cryptography is kind of incredible because if you for example have a multi sig setup you lets say you use Bitcoin core like Yeti dot Yeti cold comm what have you do you use a multi sig setup and somebody gets a hold of one of your private keys theres not enough computing power in the universe to be able to hack your Bitcoin right that really is the promise of what hardware wallets are offering but if you get access to those private keys even if theyre on a chip thats a quote secure element you know all bets are off so use multi sig use Bitcoin core it is a pain in the hat its a pain in the butt but do that if if its a significant amount of money now if youve got you know 10 15 20 30 40 thousand dollars use use a use an open node not an open node a cold card like rodolfo is a super cool guy its a cool product hes always making it more fun and interesting to use totally appropriate for some and maybe Im wrong right maybe its good up to a hundred thousand 150, 000 these are just gut feel off they get sort of numbers I mean Dan Kaminsky didnt spend six months or you know even six hours thinking about what it would cost him to hack that it was just off the cuff right so use these as general guidelines general gut feel but if its more than a lot if its a lot more than fifty thousand dollars dont use anything other than Bitcoin core if its less than any of these are probably fine Benny yes so I guess Ive got further questions for Jade over here so my understanding of a lot of these attacks are are they are physical obviously theres an element of trust when it comes to what what is the software doing even like in just generating the seed you were talking about entropy I know that Rodolfo with the the cold card allows you to introduce your own entropy even by rolling dice when youre setting up the seed so that hopefully would and and its open source so you know hopefully that would mitigate some of that how much of what youre talking about is is remote versus getting your hands on the physical device and how much of that is affected by having introducing an additional passphrase on top of your seed so the the real problem with a lot of this stuff is that even though its opensource theres just not that many people reviewing the code right so if treads are put out of fix how many people do you think are actually competent and are looking at that fix every time they do it to make sure that they didnt just change the code so that when you put in your dice it is ignored right theres no way for you to know that unless you actually review the code so even though its open source it has to be super popular open source in order to be secure and thats why I say theres only one thats super popular that an open source and thats a Bitcoin core so if you want a trustworthy source of randomness for your private keys use Bitcoin core dont use anything else and theres kind of three different ways that I look at hardware wallets or to three different major problems one is privacy another is that theyre not a full node and then the third is just that they promise physical security when they dont have you know the writing checks there but cant cash right there is no physical security its deceptive to make people think that the full node issue is is a design flaw and that is that when people are buying me is theyre buying them because they want to be able to plug them into an untrustworthy laptop and still not have their Bitcoin stolen but the laptop is doing a lot of important things its verifying lets say that it you are more extreme than most in that laptops a full node its verifying that youre getting genuine Bitcoin do you want to actually get genuine Bitcoin then you better have a full node thats on a trustworthy device you cant you cant have an untrustworthy laptop thats your full node and plug in your old card and be confident that youre getting genuine Bitcoin so every single thing that that laptop does thats important thats not happening on the hardware wallet is a huge security design flaw another thing thats come up recently is address generation so change addresses are generated on the laptop well what if that change address is modified in some way its only so the only that attacker knows where its going or maybe its their own address so every single thing that that laptop does that the well it doesnt do thats important is a big problem and I think that is I I think thats pretty deceptive marketing because the only people that buy these hardware wallets are buying them because they dont feel like they can trust their laptop so logically what youd have to do to address all those problems is move all of those functions slowly over to a hardware wallet and what do you have when youre done doing that you have Bitcoin core running out of Ubuntu laptop thats freshly installed doing everything that a full note does because everything a film everything a full note does is security sensitive so you dont want that to be anywhere else and then the third area is privacy and you have to be using your Hardware node again with the full node so you might as well just have a full mode but the reason that people buy these hardware devices is because they dont feel competent to set up a full node so a lot of it is you know these things are cool I would like to play with them Id play with them a lot more if I could buy them without having to give up my identity and be on a list because you know Im paranoid but I think theyre fun and thats fine but its when they start making you feel like youre safe either with physical access or with an insecure laptop youre plugging it into or using it as its designed out of the box you just plug it in and you use their centralized service to check your balances all of those things are where I have a problem where the marketing and the reason that people are buying them dont match reality so though thats thats my take on that if its a small amount you know you dont really care about privacy and and to be clear when I say that youre sharing your home address with Trez or when you use a treasure its not just when you buy the device its also when you plug it in to check your balance because it calls treszura services from your IP address you know maybe youre using tor maybe youre using a VPN but look these things are marketed to people that are not super technical and so I know what theyre doing theyre plugging the damn things in and theyre giving their IP address which is easily correlated with their home address to anybody that cares to go through the trouble to treasure along with every single UTX of them that they have I dont think most people buying treasures know that and thats why I have a problem its its the deception okay just to jump in there this this is uh this is such a good point that its kind of like you know were transitioning all of our all of our valuable stuff all of our relationships all of our at like physical money and everything to digital from physical and in physical I feel like we have a set of kind of procedures and things that work so if I have like an expensive you know if I have a stick of gold Im not sure I want to keep I dont feel comfortable in the security environment in an apartment or a house thats open you know near a major street and it you know somebody could come in and just break it in and take it so okay maybe Ill leave it Ill leave it at the bank or something and so you know when youre traveling to and from places if youre going into a bad area you know maybe dont leave your laptop on the backseat of the car because if somebody sees it there then maybe try to go and get it and so theres like these like physical things that we do to try to like protect our money and our valuable stuff and now that everything is digital I dont think we have any sense of what is you know like theres some neighborhoods in San Francisco where if you lose your car with the windows up its gonna the windows gonna get broken we dont know where those neighborhoods are digitally and I think we also just have no sense of like what is actually valuable and whats not so you know when somebody grabs your Twitter account or they grab you know your Facebook account and hack into you theyre actually hacking into all of your relationships so theres a two bit idiot on Twitter hes been hacked like five or six times its like every week hes got a new hack and you know these screenshots keep coming up where its you know so he tweets some but be like urgently like hey I need to get some Bitcoin in somebody on the other side hes thinking like well I value this relationship the guys in trouble I might as well send him some money and and so theyre able to just kind of take advantage of these things so I dont think people yet have the the sense online for safety that they do like physically JW yeah no I think hes spoton there man I think thats absolutely true like in physical things we have pretty good instincts if you leave your laptop on your back seat you know and it gets stolen people are gonna be like ah youre youre an idiot but when it comes to stuff like this youre really relying on marketing from the companies that are selling you products and then were know randos like me to just complain when I dont think theyre good and thats a tough thing to try to navigate that said I dont want to overstate the risk here there havent been a whole lot of people saying hey my bitcoins have been hacked so dont panic dont do anything dumb take your time make a plan to migrate to Bitcoin core for your bitcoins that are you know significant value in cold storage I obviously put a lot of work into Yeti coal calm with my son and I think its pretty decent but its in beta right so take it take it slow and be careful but the other thing is we got to put this in context with like the rest of the banking system and everything else like its not just Bitcoin right so you might be freaking out that your Bitcoin can be stolen right now youre the stuff in your bank is absurd like my biggest problem with Unchained Capital and costs a hole is that theyre trying to bring security a Bitcoin back to the banking system era its not that banks are safer theyre worse right its much easier I promise you to impersonate you with a bank you know do a sim swap do a couple other things and draw money out of your bank account than it is to steal your Bitcoin right now even if its on what is this a keep key right like I would much rather have my money in a keep key right now with all the issues that it has then have it in a US bank account because that stuff is riddled with security holes that you wouldnt believe the only difference is that the taxpayers fit the bill on all that not right now all those costs are hidden in the banking system because itll probably be reversed youll probably get an FBI agent assigned to your case for free and youll probably get all these hidden benefits but were paying for them you know were paying for them in the fact that beef is four percent more expensive every year for everybody and thats part of part of that expense goes to covering all the all the nonsense in the banking system that makes you think that youre safe when youre absolutely not but you dont care because you dont you dont realize youre paying for it no matter what all right anyone with conclusionary remarks on this this topic here of storage to me its it still feels like theres a spectrum like again as Jada what you was saying you know it depends on the amount what youre trying to do and again always assume that if somebody gets your somebody gets your physical device well theyre they very likely will get a hold of your Bitcoin that should always be the assumption and be ready on hand with it but theres theres always going to be worries unless unless you end up doing a multisig set up like JW was saying with Bitcoin core and and realistically how many people are actually gonna do that and and be able to learn and do that well see so yeah I guess it just goes to prove things are still very imperfect and and hopefully theyll get better and hopefully we get to a point where there are enough eyeballs on on certain products and and the code behind it that we can be more confident in the way its executing but time will tell I will say this you do have to put it all in perspective like JW said better than banks with that in mind proof of keys people its coming up if youre new to the space and you still have your coins on coin base or whatever this is the time to learn how to send your Bitcoin properly okay that thats what uh you should take proof of keys as we talked about trace and I talked about on the show last night you can watch it does anyone have comments on proof of keys before we get off of this storage topic are you guys enthused do you think itll bring down some exchanges at all get I think itll be kind of a repeat of last year I think I think more people will probably partake I dont think its necessarily gonna take down any exchanges but hey hopefully it becomes more of a mainstay of the Bitcoin ethos and every year more and more people partake Id like to see it become pretty widespread but I dont think its there yet I dont really have Bitcoin with any custodians so I get to just watch from afar but you know Ill Ill celebrate like everybody else we know with proof of keys is very interesting because we have all these companies out there that are now offering to hold your Bitcoin and theyre going to give you interest so some people are still going to keep their Bitcoin with those third parties which I think is I is unfortunate I am NOT down with any of the companies that give interest on the big coin I say control your own private key people Ajit your thoughts on approving keys yeah I think I you know I like the idea a lot the reason why I like it is because if you dont have this proven case type situation where the reserves just call them exchanges like compared to banks if somebody isnt paying attention to the bank then whats gonna happen is theyre really well connected people are gonna get loans for cheap and you know theyre not gonna pay the loans back and then these losses are absorbed by the other depositors so this is something thats happened in the United States happened in India just recently with a massive bank failure and this is a bank that was in you know for 6070 years it was operating perfectly and complete failure and the people who got all their money out where the really wellconnected people the people whove been using it for cheap loans very wellconnected people and in almost every single country that Id like Google around and looked youve been able to see a similar scenario and I think we got to avoid that type of thing in our space in the Bitcoin space by selfregulating and thats through stuff like proof of keys where you just kind of you know gut check the exchanges and see you know are they prepared and and it just kind of potentially exposes that its like when the tide goes out in the water you find out whos swimming naked and well find out you know if theres potentially players who are being unsafe or dont have the proper reserves JW yeah I love it man I think I think this is maybe gonna be traces greatest and legacy is coming up with this concept because this is one of the cases where I do want people to freak out right like dont freak out over keep key and move your bitcoins rapidly but do freak out in this case and the reason I say that is that if youre listening theres probably this is my gut feel of course a 1 in 20 chance that exchange that your bitcoins are on is going to be insolvent over this event so if youre comfortable with that leave them there but the the great thing about this bank run concept is that if if theyre running at a reserve the people that are the most fearful that dont take them out on the 3rd and take them out on the second are going to be better off but the people that take them out on the first are going to better off still right whos gonna get left holding the bag when there is an installment exchange and if this does force an exchange to go bankrupt its gonna be the people that move first so if you have your money on one of these exchanges I do think its a really good idea that not only do it on the third but do it a couple days early because you dont want to be the last one to pull it out youre gonna be the guy that is the case study that tells everybody else that the exchange was insolvent right you dont want to be the last one without a chair so do panic if you have money on in exchange just you know for a few days panic get it off and then if you know youre a degenerate trainer and you got to put it back on put it back on but when you got a one a 220 Jan sore maybe even a 1 in 50 chance of all of that money being vaporized take it off for three days right I really think you put it in perspective there I think those are good numbers to think of there is it between the two and 5 chance that this movement could actually bring down an exchange and you dont want to be the person on that exchange so those are C and again hes pulling those numbers out of his head I think Im thinking of those numbers right now you see my head move I think thats a good way to think of it 2 to 5 chance that this brings down in an exchange and thats big enough that it that that is not thats not worth the risk at all by the way all these dudes are linked to below pound that like button all right speaking of well were gonna move on to mining real quick here G you read that report that mining report tell us about it yeah so I read the report at bitfury George whos the CEO of bitfury which is a mining company based in Georgia and he kind of he kind of put together an interesting analysis which says that hey theres kind of this paradigm shift happening and in the way that you run a profitable mining company so in every industry you know theres a whatever the new thing is can can generally charge higher prices because theyre solving something new so for example you know bit Maine has been like the boogeyman in this space for such a long time and for a number of years were all really concerned because they were producing toptier mining equipment and so it kind of presented a concentration risk but one of the things that is beautiful is you know when somebody is making that much excess profit margin above beyond what you like normally consider and beyond the opportunity set there was a ton of people who are looking at that like really hungry eyes and dingy like I kind of want to be making those site to profit margins so of course you had a ton of people a ton of capacity and mental energy going into well okay how do we copy their hardware how do we copy their their methods for putting together these chips and you know who can we hire away from their company and then sure enough other people started to develop equivalent kind of technology and bitfury George is just pointing out that hey this is kind of interesting that now that the kind of mining hardware layer is becoming a little bit more commoditized and that the theres not that much variance between the best mining hardware and the worst mining hardware thats to no longer someplace to compete so if you have a better relationship with bit named than me it doesnt mean theyre gonna make more money than I am now the relationship is equal because I have alternative suppliers so anytime somebody has a monopoly they had bad service and they overcharge quoteunquote overcharge but now that theres competitors the price is down anybody can become a miner so now where do you compete so now that revenue is kind of potentially come down a little bit the other place that you look for is your costs and the largest cost and mining operations is electricity so I think hes pointing this out because I think my understanding is that he has kind of bitfury has like sweetheart deals where theyre contracted with like local large utilities and theyre getting really cheap electricity prices similarly you see miners kind of crowding around places with hydroelectricity because that type of renewable energy is extremely cheap so everyone now is gonna be focused on reducing their costs for their mining equipment where is the lowest cost place its its where you have renewable energy and then if somebody wants to make an even bigger investment were talking you know 10 20 years in the future the lowest cost energy is of course nuclear power so nuclear power is something that is actually extremely safe relative to all the feeders that people have but this is how something like Bitcoin which is just a pure price signal gets all these people interested and involved in acting all these different ways and it kind of leads to you know new breakthroughs that we wouldnt have seen without it so right now the breakthrough is wow we have really strong ASIC mining equipment and the future of the breakthrough is this is going to lead to nuclear power becoming popularized again and delivering free or you know lowcost cheap electricity for everyone so now the world is constrained because nobody wants the people in Africa or Asia to become more developed because its gonna cause climate chaos right so theres these kind of I mean it feels like kind of an effort to you know not have them develop as quickly but with free nuclear energy and you know those constraints are no longer there so its kind of a really optimistic way to think about the world and that was maybe not the full focus in his article which is more on the commodity hardware but but thats the kind of vision that thats like the natural logical next step that alright I appreciate that you read that whole thing it gave us a good summary like that was not everyone again not everyone could pull that off do you guys have any comments on on the mining situation at JW or eveni yeah yeah actually I think I mean two years ago I was debating Luke jr.

Bottle Pay shuts down, Keepkey issue, Mark Cuban, Square, Greece

and Cobra as these guys were pushing for a proofofwork change and I was saying look we need to get to a point where these Asics are commoditized because thats what secures the network if we do a proofofwork change it resets the clock on that and we have all this new opportunity to have you know just a few small people have a lot of control over the network because theyre the only ones with that specialized hardware it takes time for things to become commoditized so I think its awesome that only two years later were at the point where were like oh yeah although all the hardwares commoditized that is a huge impact on Bitcoin security you know thank God that we did not change the proofofwork if if it comes up in the future and theres another attempt because thats one of those few attacks on Bitcoin that wont go away theres always going to be the potential to convince a lot of people to change the proof of work and basically obliterate our security so be aware of that be one of the people that are saying no bad idea but its awesome that were in such a strong footing now compared to years ago where that you know we had some pretty popular people advocating that and it was a viable possibility yeah that attack vector will come up again its its all cyclical III foresee that I dont know when but it they say there were legitimate names talking about it so uh who knew who knows BTC Benny yeah its it is nice to see that you know the further decentralization of mining itself every you know especially ever since we ran smack dab into Moores law and and now you have that time horizon where it takes a little bit longer for new chips to come out its it makes it a little less practical for for people that are manufacturing the chips to hold on to them too long and mine themselves before pushing them out to market so yeah it does just kind of help the whole space in general where theres kind of a little bit more equal access its nice to see new basic manufacturers pop up around the globe Im sure that will be further decentralized we did there was a recent article about China having what 66 of hash rate or something like that it there was a recent uptick but I think that also I could be mistaken but that also coincided with some of the new chips that have just been started to to hit the market and since a lot of them are manufactured within China then that could be coinciding with the initial hey were gonna run these a bit and then send them out but again like if you look at the bigger trend it is leaning towards things being kind of more globally diversified theres a lot of it going on in here in Alberta as well theres strand of natural gas in northern Alberta where I live and you have people like Steve barber who are basically rolling ups kids that are portable miners in there theyre capturing natural gas that would have been just vented into the atmosphere and theyre capturing that waste and converting it into power to mine Bitcoin so yeah its you know it leans towards the the cheapest just available power and in this case its actually a plus for the environment as well because that would have that would have been terrible for the environment if it was invent it was vented now instead of paying that carbon tax and polluting its now being burned and used for something good which is securing the Bitcoin network so yeah good good good bringing up Steve barber hes been on the show before Ive obviously weve all hung out together good good dude doing that thats some creative stuff up there alright jeet since it you started the topic youve anything to say to conclude this topic no I think this is this is awesome this is the kind of dream of Bitcoin that theres now something that stands outside all these you know people who want to interfere in the marketplace and just provides pure price signal and it allows people to kind of coordinate around that so super excited about the potential for this sorry one other thing that just kind of came to my mind into I was at a Bitcoin comp or a kind of Bitcoin ish FinTech conference in Toronto and one of the folks theres a kind of academic they put together an analysis of FX rates the official FX rates published by governments versus the local bitcoins FX rates and they kind of saw a correlation between when the price of the currency makes large movements on local bitcoins it kind of predicts that oh wow so now that all these people are trying to get the money out of that currency in the theres a Bitcoin premium there whats happening is theres going to be a move or there has been a move where the government is messing around with the supply of that local currency so this is something thats come up in places like Argentina and of course Venezuela but its kind of cool because those governments depend on manipulating the price and all the newspapers and everything else so if theres some source that says you know the prices that theyre telling you is actually a lie the real the price is much higher for your currency and that means by the way that all your food is much more expensive and everything else its just a cool signal for those people in those countries to have you know some alternative source than their local newspaper to understand what their real situation is so its just a small example thats the kind of vision here now for for those who can dig that deep in those kind to find these alternative sources I mean thats the thing most people just go with what the government tells them to do now on that topic the government telling you to do something uh I know I didnt go over this topic with any of you before the show so maybe you read the article but in Greece there they say that citizens have to spend 30 percent of their income now electronically or theyre going to get penalized because this is a way to avoid people not paying their taxes who has comments on this uh yeah Ill dive in I was I was talking about it on the show the other day but yeah essentially you have to spend yeah 30 percent of of your given monthly income electronically and if you fail to do so whatever remains out of that 30 percent will incur I dont know if theyre calling it a fine or a tax but its 22 percent of whatevers left so lets say you make a thousand euros in a month and you now need to spend 300 years of electronically then that remaining 100 euros will be taxed at a rate of 22 percent which is in insane if you know the the war on cash is real there is we also have at this in the same breath theres another story about Italy where next year cash purchases over 2000 euros will be illegal and a year later cash purchases over 1000 euros will be illegal and if you do allow for a cash purchase over a certain amount youll be fined and if you refuse to accept credit cards youll get a believe its a 30 euro fine plus a percentage of the disputed amount that was not allowed to be paid by the customer so yeah the war on cash is very much accelerating but luckily hopefully he will clue in and they can utilize Bitcoin yes utilize Bitcoin beat figure out ways with Bitcoin to get around all that theres nonsense in those countries Im glad Im not in Italy or Greece do you guys have thoughts on that let me jump in on that one because you know to your point earlier about like who can actually access the stuff outside of their country the the the war on cash is a problem because its kind of pitched as this way to get rid of crime and everything else but the problem is that the the people who are actually using cash are just kind of marginalized poor people or their elderly people who dont know how to use like electronic payments and cash so represents something like 50 of all the payments in the world today so when youve seen other countries making moves like this to get rid of Dib to get rid of cash in the favor of digitized payments the people who get impacted are the poor so in India they did something called D monetization they took all the old 100 bills they said those are illegal now but you know you got to use these new hundred bills but you only get from the bank so you got a you got to go to the bank show up and transfer it and what ended up happening of course was all the really wellconnected people showed up to the bank first and the night before they got all their money out and so the people who are left standing in line for days were like just the kind of normal average everyday people and the poor people who are like selling vegetables and you know running their own small businesses theyre just completely disadvantaged because their middleclass customers dont even have cash to give them so theyre like stuck at the very edge of the network and you know when you have these like withdrawals of like you know key services like that its the poor who are impacted the most so this thing in in Greece its kind of a great headline for them and it makes them look like theyre getting a lot of stuff done but its also kind of dangerous because you know in Greece no one actually pays I shouldnt say no one but very few people pay their tax at corn do all the newspaper stories and I was reading this thing that apparently 5 of the population which is the middle class who have salaries so its easily visible theyre the ones who actually pay the tax they pay about half the tax its just those 5 and so the really wealthy people already have you know businesses outside of the country and bank accounts outside of the country but your normal average everyday guy is just stuck there like he doesnt even read the newspaper he shows up like wait youre saying my dollar bill doesnt work anymore so yeah the impact of this make no mistake is going to be on the kind of marginal people in the world yeah the real criminals arent using cash theyre using hsbc totally before you get too excited about you know not being in in Greece or Italy or France or these places that are that are being more aggressive on cash the reason that the US isnt that aggressive on cash is that its more sophisticated right so everybodys freaking out about you know China and its dystopia meanwhile we have the greatest surveillance state the worlds ever seen right everybodys freaking out about the monetization or the cat the war on cash in Greece right now but you just said almost nobody pays taxes in Greece I would love to be in Greece nap right now being one of those people who dont pay taxes I pay all of my taxes because Im terrified of the Eye of Sauron and I know its here its not over in Greece in the United States we are the absolute best at collecting taxes were the best at surveillance and were good at propaganda so we dont do stuff thats all roughandready and we just pass a lot of 30 we just werent going to deal with PayPal MasterCard and Visa behind the scenes we we make sure that Twitter censors the right stuff and you know we get we get stuff done like a sophisticated Empire not like a bunch of you know retards that are gonna go out there and make it obvious so dont be too happy that you live in the land of the free because because weve got it dialed in so let me let me push back on that a little bit one of the things thats important to note is that if like I kind of have measures of who pays how much tags and how much they expect theres actually less tax evasion in the United States than economists would predict because people generally like you know even though I love them the first person to complain like the roads are bad and you know the taxes are definitely like too high and the government spending is very inefficient but people like like to feel like theyre contributing towards something so the amount of tax evasion is actually far lower than what youd expect so thats what Im fair to say thats my point the amount of tax evasion in the u.s. is far lower you might say its because we love paying taxes but if you know very merit many Americans you might be here we dont love paying taxes we hate paying taxes but were terrified I have sat three targets driving at 30, 000 a year and it took like 80 hours of torture of him going through all of his receipts like we know how to make it sting and we know how to send a message to a population that you dont evade taxes without having to seem so heavyhanded gee you were saying no no I mean it is really hard to know but you know I need to look more into it but I do think that people like people well its hard to say I think your average person I mean theres definitely billionaires and things who can avoid the taxes just like in Greece but I think your average person maybe they dont like it and they complain about it but they do pay their taxes and I think so I dont think its all the surveillance state I think some part of it is like people do feel like the government is providing legitimate services and I think that the problem places like Greece is Greece India is the governments not providing any services to begin with so people feel very comfortable avoiding taxes like in Mexico its a similar situation nobody pays the taxes and yeah I think that its I think its more driven by the lack of government services being delivered at all so theres no public goods whatsoever so the tax feels more like a mafia shakedown kind of thing I would argue that thats more propaganda if youre a normal person in the United States and you call 911 youre not getting a cop to show up and take care of you until its time to mop up the blood Im sure its the same thing in the middle of nowhere in Pakistan but we feel better about it because weve been propagandized since we were three years old in public school for the last you know two decades I will say this about what JW said about propaganda that there are a lot of Americans who blindly blindly believe yes must must paying taxes makes me loyal makes this make makes everything all right there now theyre not worried about like like a lot of people like I gotta pay my technically I got to pay my taxes or else Im gonna get tortured with this audit but theres some because of the propaganda and Im not one to jump into these propaganda type of things and overblow it but here I gotta say that a lot America a lot of Americans are just like yes must pay taxes because they have except thats the right thing to do it is it supports the country it makes us stronger pain had a propaganda even that is propaganda because the IRS publishes stuff regularly and says if you get paid in cash in youre an American citizen you dont pay any tax so if you know that you have the opportunity because youre youre doing something youre running some store and some tourist town and people are paying a lot of cash the IRS will admit like you can you can search for it that they dont get on average any tax out of people that are primarily paid in cash so the propaganda doesnt actually work but if youre already paying taxes and youre forced into it and you know what are you gonna say like you might you might as well say that its not so bad if its already taken out of your paycheck right but we know empirically if given the opportunity the average American pays zero tax just like the average grecian the average Indian its all a system of fear and intimidation and you know I dont know that thats thats the end of my rant on that topic all right yeah we got we are Bitcoin people getting the big all right lets get into the Yenta the gossip part of this show real quick BTC Benny talk about Mark Cuban I couldnt believe it he says Bitcoin could be hacked I mean what wouldnt wear it where is this what is he I couldnt believe he said that one line like is he that confused or she just angry yeah I mean so its its ironic coming out of a guy who had the foresight to make a bunch of his money in the tech bubble of the 90s to be dumping on the next big wave of interesting technology but that said a lot of the a lot of this stuff that he recently said seemed to be flood and and just not correct so part of it he was saying oh its too its too difficult to use but in the same breath his team the Dallas Mavericks accepts Bitcoin and he even in a another interview said that they used to accept it but then people didnt use it but then the the methods with which people could pay got easier so then they brought it back so that people could utilize it he also said it will never be a reliable theres no chance that will ever be a reliable currency and yet again he accepts it as currency for his team so it just seems like a lot of the stuff that hes saying doesnt quite line up and to his point that its difficult to use is there a learning curve absolutely there was with the internet and look at us all now streaming a live show with the four of us with an audience that is currently taking it in but hes just this fact that he said that it got easier and so they reacted it means that its not static it continues to evolve and grow and for him to not see that is a tad ridiculous I just think that hes very focused on the now he wants to see that this is a a globally used currency by everybody and hes not really kind of zooming out and seeing the bigger picture is is how it comes across to me but I dont know Im curious to hear what you guys think about this you guys any thoughts on him I know a little bit about Mark Cuban because I think hes a you know that show that hes got and everything hes so shes such a popular business figure so I I do know a little bit about him and one of the interesting things is you know hes actually hes famous for bringing radio onto the Internet so you know a lot of people you know they theyve coded things and he just literally said lets put radio on the internet so its kind of its kind of cool that he was able to sell a company broadcast comm that was literally radio on the internet for six and a half billion dollars during the dotcom boom the other interesting part of that story is he had one and a half billion dollars of that or one point four billion dollars in that in Yahoo stock so he was worried that were in the know comm bubble this is not real money so yeah whose stock is not a good currency and I need to get out of it so he set up a hedge with goldman sachs so that if the price of Yahoo stock went down he would actually hit you the hedge would increase in value and so it would cancel out and youd be able to preserve the value of that depreciating currency of Yahoo stock and I think that its kind of rich coming from him to say that bitcoins not gonna be something or theres no use case or it needs to be spent day today because when he needed to protect one point four billion dollars he found a way to protect it and I think in a similar way theres a lot of people out there who dont have access to you know real estate in different countries or you know swiss bank accounts and theyre sitting there thinking like Im not sure I trust the current financial system and I want to hedge my bets a little bit and Bitcoin is just its so its so popular now and its such an option that theres an entire kind of spectrum of people who dont have access to that stuff thats only available to millionaires they dont have access to goldman sachs but they need to hedge their bets and so what are they gonna do the option becomes Bitcoin such its so popular throughout the mainstream media you know famous athletes are they accepted as currency instead its just becoming popularized and its gonna become the new way that if you have a windfall of cash the first place you should park it throw some in Bitcoin and kind of get off zero so I think that yeah thats kind of my take that I really just dont believe him pound that like button I I like that gig okay JW any any takes on the mark you bitter yeah I mean Ive worked with guys like Mark Cuban and I think a lot of people overestimate how smart these guys are theyre you know Im not saying that theyre lazy or that theyre dumb theyre certainly neither of those things but a lot of a lot of the skill set that you need at that level is political you got to you know its a little bit of right place right time its a little bit political if youve worked with guys like this you know that theyre not all that sharp technically right like theyre theyre theyre not technically eeeh TSAs well how did he make money he put radio on the Internet I guarantee you there were thousands of people that were like yeah thats really stupid were obviously gonna have radio on the Internet right like this is but right place right time comm bubble you could put anything on the internet for a little while there and get crazy valuations and Im not trying to take anything away from him Im just saying it doesnt surprise me that he doesnt get it hes got a ton of money hes got a ton of stuff going on hes not as bright and as technically confident as a lot of people would think and Im sure you know even though hes talking trash on Twitter he has not taken the time to research monetary history for 25 minutes so Im not sure all right all right dudes we have reached the end of the show here and I want to hear from all the guests there conclusionary remarks any stories they wanted to bring up anything they want to promote so well start with Ajit yeah so super pumped about this conversation I think the key takeaways were that get smarter about you know being digital online and the kind of safety and stuff that you need and also that a lot of this the other thing for me it was just the war on cash and how theres a theres a theres a gradient of technical people versus nontechnical a lot of stuff that doesnt necessarily impact us and were safe from theres a lot of nontechnical people that had impact so those were just my two key takeaways the other cool thing I want to point out is there was a recent election in the UK where the probe brexit party that the party that supported brexit had kind of a really strong results and the reason that I think thats interesting is because outside of the United States the European Union is like the second strongest currency or the safest kind of jurisdiction and when brexit actually happens in Britain exits the European Union it kind of is gonna start off a chain reaction of then Scotland is gonna want to exit Britain and join the UK theres countries in the EU that want to get out so its you know places like Catalonia theres parts of Italy that havent been independent or havent been dependent for that long different countries that have like breakaway movements and all of a sudden the project of the European Union and the euro currency is gonna start to look less and less likely to last a long time and so when people start to think about how do they hedge the risk from that bitcoin is gonna become an option so thats a recent kind of more political event that happened but the the longterm takeaway effects of that is these like political projects that technocrats are putting together are not going to last a long time this thing only lasted 40 years and it involved an enormous amount of effort and its completely starting to fail so its very exciting times for people who are interested in smaller levels of silencing that all right good take on Briggs in the European situation tying it into two Bitcoin JW your your thoughts your conclusionary thoughts on or anything you want to add anything yeah actually Ill just say that check out that mascot calm thats thats my main project Ive stepped away from that for I dont know the last couple months as Ive been trying to work on Yeti cold calm but were were back at it were working on it if you are in a situation where you want to move your cold storage to Bitcoin core which I highly recommend for a lot of the reasons that we talked about and some that we didnt yet ecole comm is my new site its basically a like a thin Python script that will help you set up Bitcoin core and enable you know QR codes its it does as little as possible and lets Bitcoin core do the rest were in beta now so if you guys can screw around with that test it you know give me feedback find bugs that would be awesome and yeah than that just stay safe its gonna be an interesting year all right interesting decade on the way here all right Betty you got the final word here yeah I mean I really enjoyed combo with everybody thanks for uh thanks for being awesome but I I guess my general sentiment right now I really I really like where we are at in the space in general right now it kind of feels like the calm before the storm again its very reminiscent of late 2015 early 2016 where weve just seen a bunch of great crap built out that was much needed but you know the you know oh yeah yeah yeah sorry that you know were pre happing theyre still like thud in the air theres a lot of saltiness it very much seems beckons back to that time to me and Im excited to see how things progress especially post having and and if we do get another mania in the the year following that how how much more resilient and robust bitcoin is to handle new people so again I guess time will tell but Im excited to see what the next couple of years old alright thats a great way to conclude the show were entering that golden age decade but yeah I was nodding my head this reminds me a lot of the end of 2015 also so okay dudes we do this we can be coin every Friday and were live again and weve got three guests again so hey well be back next Friday remember I do a new show here every single day so follow me on twitter at tech both come through this channel bitcoinmeister every day you want to disrupt meister comm what else oh yeah saturday thats tomorrow will be the beyond Bitcoin show as usual so thank you guests you all rocked the world shabbat shalom everyone have a great friday im adam meister the bitcoinmeister the disrupt meister remember subscribe to channel like the article share the article pound that like button and bang that bell button take care everyone thanks a lot again see yap

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