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Next-Gen Bitcoin: Are The Existing Scaling Solutions Good Enough?
Recorded: Oct. 11, 2024 Duration: 1:03:27Space Recording
Full Transcription
GM, GM, John, can you hear me?
Very clear.
Very clear.
Okay, great.
Still expecting two more speakers.
They're already here, need them to request the mic.
We're going to be starting in two, three minutes.
Awesome.
Hey, England.
There is an echo from my side.
This is what I hear.
It's not super clear.
How about now?
Am I clear?
Yes.
Nice and clear.
All right.
Great.
Hey, Dane.
Hey, Dane, can you hear us?
Let's have a quick microphone check and then we can start right away.
Hey, Dane.
Hey, Dane, can you hear us?
Let's have a quick microphone check and then we can start right away.
Let's have a quick microphone.
It's okay.
Just letting them know.
I'm typing.
Oh, everybody.
My voice is a-
Going
I've got much � who's like that.
Oh, man.
Cool, man.
promo-iya.
Let me plug some stuff in here.
You know?
I'm loving, amazing.
Super, man.
I have my experience today.
I'm convinced you're going to be something.
By the way, Eric, Eric, Shawn, I'll play-
let's try now
okay nice nice and clear now can you hear me can hear you great okay great i think um everyone is
here we can we can start right away let's wait one more minute because we have just reposted
this um please retweet the the link so that um many other people can see and join us today
we're going to be talking about next generation bitcoin um and current and existing solutions
how we should look at this and what should we expect starting in a minute
all right i think we can start um good morning good evening and good afternoon everyone
wherever you are uh it's my evening time 8 p.m i'm not sure where you where you guys are based
in um so i'm going to be asking this we have john uh from last us we have uh englandia a good friend
of mine uh from big way no ass and dane uh from court network uh we're going to be discussing the
existing uh scaling solutions whether you call them uh side chains layer twos whatever because
because there's apparently um uh you know still things going on with with terminology back there uh
but again we're going to be diving in all this uh listening to um you know um experts from you know
their builders have been building i personally know quite for a while um and we'll be approaching
from different perspectives to to the questions which are um relevant to um um
later twos and what i call next generation bitcoin um so i just without further ado i think i'm going to be
giving the mic to the speakers for a quick self intro and then a brief uh information about the project
that you present maybe we can uh start with john john can you please briefly introduce yourself and also
uh talk about for those who really don't know uh what elastos is actually doing um so yeah the mic is
yours great um and thanks hakan for asking asking us to speak here um it's a really fantastic topic um
just to explain i'm head of growth at elastos um i've been working with the ecosystem for two or three
years now um and i'm just give you perspective on this question um previous to to uh being in web 3
i've worked a lot with the development of um cloud solutions um you know all the way back uh back
back at the beginning and i i think my perspective on on this is that um that you know in solving some
of the problems that uh the web 2 faced in scaling there were there was a need for multiple different
solutions right so different kinds of open cloud hybrid cloud uh different forms of software service or
platform of service so there were lots of different ways that problems were were addressed and and a
lot of it revolved around um you know not coming up with just one answer but um multiple different
approaches so i i guess that's my perspective on how how the challenges we face um in terms of creating
great screening solutions um and i would state state that um elastos really sees this as a huge
opportunity um for those of you who don't know us so well we are a a full stack um web 3 um uh business
um but particularly importantly we focused on uh layer 2 um with our bell 2 technology uh which is in
fact um an interoperable um solution for other layers layer 2s we're essentially a communication
protocol um and that's really what um means that we can kind of approach these issues from a point
of view of collaboration uh which i think would be my uh overall point that um in terms of answering
some of these big questions you're raising here it really is about thinking thinking about the bigger
picture and trying to collaborate um so that's just a quick intro um for from um myself um and elastos
and look forward to going a bit deeper um in a moment thank you john um pretty enough uh we would
definitely need to know more about elastos in the coming questions um so i would love to give the
mic to englandia um maybe you can talk about uh what bitcoin us is doing and i know you've been
building in the bitcoin space for quite a while um maybe you can briefly share what your experience is
um thanks akon for inviting me shout outs to bvm for hosting um so i've been building in the bitcoin
d5 space for about four years when all we really had was rootstock and lightning network um i've
contributed at badger dow um basically like a one of the early bitcoin d5 dow as well as sovereign
bitcoin um bitcoin d5 um decentralized exchange suite of products for like swapping lending leveraging
um bitcoin back stable coins etc all in one place um and so we're a few years in to bitcoin d5 and i
think we're learning a lot about um what bitcoin needs to scale what type of scaling um bitcoin d5 needs
and um i think it's great that a lot of these um scaling solutions have launched this year um you
know over 100 of them um and i would say that a lot of these bitcoin scaling solutions need scaling
solutions of their own um and uh some of the founders of uh sovereign took a step back and and
tried to focus on like one of the main issues uh with scaling bitcoin and that's really the security
aspect once you're hopping from layer one to you know another another system and so that's kind of
what bitcoin os is all about um we did the first ever zk proof on bitcoin mainnet in july and we're
trying to apply this new technology um we're calling bit snark uh snarks on bitcoin uh to create
a number of different solutions uh from trustless btc rails um to um the ability to actually roll
transactions to bitcoin from any layer layer one or layer two um programmable tokens on bitcoin uh private
transactions covenants um all these wonderful things um and so yeah that's basically our mission
uh excited to speak with you guys around that
appreciate it thank you um and lastly we have dane uh from goat network dane can you hear us
i can great perfect so the mic is yours uh great so happy to be here um goat network is uh doing two
things that are a little bit different um we were talking just earlier about the idea of zk proofs
so that's how we intend to inherit bitcoin security our sister company is a company called zkm
and they are working on bringing zk proof architecture to bitcoin layer two which as just
mentioned is a huge step forward uh we're looking forward to the development of bit vm2 eventually
that will be a major milestone in terms of smart contract deployment and in terms of moving away from
the side chain model that currently exists in the industry um so that's the tech side for us
and especially for me my small brain i am not a dev i come from a marketing strategy background but i
think about things in terms of and so do we in terms of economics you look at bitcoin and what is it well
it's a wonderful asset it's a store of value you can use it for a lot of different things when it comes
to payment and so on however you can acquire it in essentially two ways on a sustainable basis number
one is you buy it it's expensive although you can buy sats it's obviously an asset that you can buy but
you know you want to own a bitcoin it's not easy and of course mining it is even more difficult right
so you're mining it and the cost is tremendous the tech barrier can be difficult for retail
and so on so what we've done is we've built out this really robust economic model which basically
provides sustainable btc yield it's really long to explain it right off the top so i'll wait until
later but um that is essentially what we feel is our differentiator that idea of sustainable btc yield
is something that we really haven't seen uh anywhere else and the notion of really leaning into
economics is something we haven't seen all that much in this industry as well so that's what goat
network is about looking forward to discussing more
perfect um again as you may see from the title of this tourist space event we're going to be
discussing the the current um and existing uh solutions that we have to scale bitcoin to bring
functionality to it um uh apparently which didn't even exist in the past i mean let's let's first have a
general overview for those who really don't know um and out of the bitcoin space we have
quite many people look around 400 people so i'm pretty sure most of them actually not uh much
familiar with so maybe um we can start discussing about like how we came through to this stage right
from um back 2008 all the way through this like 2024 actually we have had 15 years but till last year
year and a half before we didn't have any like we had some um as actually englandius mentioned uh we had a
few like lightning network liquid and a few others rootstock uh and and also our previous solution
called chain x we're trying to like look for a way to kind of bring functionality to bitcoin uh and can
we really uh scale it to what extent uh you know i'm still thinking like we're still in experimental
stage testing out a lot of new stuff a lot of new approaches um we have to my knowledge i mean it's
already like um um 100 l2s uh many of them already have been announced are they really l2 what should
we understand from this like their terminal terminology layer two is it really layer two is
the sidechain um their roll-up solutions uh uh their bitvm um and between two already came up like it's
been i think a month um we were talking about opcat right um and many others like zk roll-ups so
how do you like to what extent we can we can really scale it and how we can make it more functional
right we have had a lot of uh you know we had a few different upgrades like um segwood upgrades back
in 2017 and then um uh we we had taproot uh which actually made uh what we have been actually doing
quite a while like for a year and a half uh possible uh and all this basically bitcoin relevant
asset to come up come out like um runes ordinals and brg20s and many others and many other l2s
actually tech are based on taproot uh so so i just want to know your own opinion how do you think
the current uh the current picture of the bitcoin space because bitcoin didn't have ecosystem uh and
we were talking about uh defy on bitcoin and after in particular after um it was uh token 2049
um i'm not sure if you have if you were in singapore last month uh where we had a lot of people like
thousands of people um participated in you know a lot of bitcoin relevant events so uh to like we have
held one of the biggest system event and uh it was called bitcoin equal summit so right after you know
talking with different vcs well-known vcs like polychain um uh you know a lot of like um water
drip capital um spartans so and then many other ogs basically came as a speaker joined as a speaker
so what we our conclusion was the defy is definitely going to be around bitcoin in the coming years
so yes ethereum and the rest of them you know they will you know many of them will vanish but they
will still exist but the defy will be around bitcoin um so what we need is just time still
like we need to test out a lot of new things but i'm curious about your own opinion how do you see
the current picture um i just wanted to give a little bit background um so yeah so maybe we can
start with dane this time sure happy to jump in so you know this is a space right now uh and again
there are people that are definitely smarter than me on this call on the tech side but i'll do my best
uh you know what we see right now is that it is a space with a lot of side chains which is okay you
know that's always how it's going to go if you think back to the early days of ethereum you had to
scale gradually right side chains plasma there are all kinds of ideas each one was an innovation and i
think to belittle any of them uh doesn't do it justice you go with what's best right so right now
when you look at the space uh it is primarily a space of side chains so the issue is you know
figuring out how do you move in there beyond that right so ideally what you want if you're thinking
about a true bitcoin layer to roll up you know the roll up chains transaction inclusion and finalization
that should be verified by bitcoin and for bitcoin right that's the idea can you take uh off-chain
transactions batch them finalize them and verify them using bitcoin the same way you would think about
ethereum and we still have a ways to go when it comes to that but you know there are encouraging
signs obviously uh bit vm2 development is really progressing uh what we seek to do is something
called the optimistic challenge protocol so you know really what you see on ethereum um and based
on bit vm2 that's kind of the idea and we combine that with zk proofs as mentioned earlier so
it takes time you know we're in development uh everybody else on this call is in some form of
development to work on accelerating the process but that's where we're at so in the meantime you
know users have to uh assume some they have to have some security assumptions right what are they
going to do with their assets so the best you can do is build basically the most robust side chain
possible at this point and then you scale up to the point when you can achieve the true layer two
roll up status which is coming we will see it for the industry we look forward to being one of the
first but there will be others as well and then of course when that happens then a lot of it will
come down to uh you know user friendliness uh who's got the best and uh most robust and most uh
apable ecosystem right who's got the best dApps and so on so stage one we really have to get that
security and i think stage two you'll see a really and and frankly this is what we're working on now in
parallel is that user-friendly experience what we've the other thing that we've noticed a little
bit is that in this industry as people work on security and tech and so on for whatever reason
the eco gets left behind or maybe it's like okay we're going to focus on bitcoin staking which is a
great use case perfect but where are the dApps what are people actually aping into so that's something
to keep in mind as well and again maybe i come at this very much from a user perspective from somebody
who is you know a strat guy as opposed to a dev but i really really think that nailing that for the
user experience the ui and ux is going to matter a lot as well as obviously developing the tech
um i guess i can comment on um how how effective the side chains on bitcoin are currently and i think
they work very well for that intermediate uh degen uh not quite a fish like retail but not quite a whale
um but right in the middle i like to call them dolphins where you know they they're degen enough
they're advanced enough they're willing to learn how to jump across chains they know about gas they
know about wallets they know about bridging they know about the risks involved so it's kind of suitable
for that little small subsection um which is only maybe like three three percent of of of like the
bitcoiners that are willing to even touch d5 but for the retail it's it's a little too uh complex
trying to get into it it's it's not that simple there's the high learning curve and for the whales
it it is nowhere near secure enough to really deploy a thousand bitcoin across you know an npc or a
multi-sig get it on get it onto a d5 ecosystem and put it in a smart contract that might get rugs
right so there's too many uh degrees of separation from bitcoin proof-of-work security
um but i think like the side chains of today have have demonstrated a great proof of concept
for uh you know using putting bitcoin to work um and i guess what you know what we're all trying
to do here is just scale bitcoin so that um uh there aren't as much of a secure of security compromises
once you want to um you know move your bitcoin from layer one to you know to to be put to work
yeah um and that's a that's a um a really great point um um one of the things that elastos actually
has is um a merge mine token uh so if you just step back in time um it wasn't quite 2008 but around
2010 um satoshi himself you know uh put out that merge mining would be the future uh potentially
of bitcoin and help help solve some of those security issues um so when um when we launched
our token in 2017 uh we merged mind the token um and and i think um one of the one of the exciting
things uh that's happening now in the last two years is that the benefits of that merge mind approach
um really can start to come to the fore with through the um ability to um bring some of the
hash and the security from that merge mining into the broader uh network so um again we've we've
actually um used zk proof solution um that we we refer to our approach as a native bitcoin approach
because we keep um all of i'll give an example of a peer-to-peer lending um uh app that that we have
um the what happens there is the uh if you want to lend uh bitcoin it the bitcoin is locked into the
bitcoin script so using uh the functionality and then the zk proofs actors um as i mentioned the
communication protocol um one of the other one of the things we did on our journey was um also
make ourselves evm compatible so we're able to um communicate that to uh smart contracts on the
evm chain um and enable um the mechanisms lending in this case to work without removing bitcoin from
from the network um and ensuring that um that it's obviously maintaining that that level of security
um i think what's exciting about this is it means um what we're able to do when i mentioned being in a
communications protocol is be able to offer that to other partners in the ecosystem who are looking to
be able to um share some of that um ability to uh be secure as i say it's just over 50 percent of
bitcoins um hash when we're running those models so for us we we're really excited by this because
you know having been around for quite a long time and really pioneered in this area um and our goal
is to maintain the integrity of bitcoin in and its decentralized um capabilities um so so we see this
as as a really exciting moment um and it's interesting that um everyone here is using zk proofs because
uh the um the the additional point that we're we're adding to to this is an arbiter network that for
instance in the lending protocol allows us to um arbitrate disputes that might occur between
um someone's blocked bitcoin and somebody who's um say put some usdt um into the lending app um and
and these arbiter network um notes um are able to um resolve any dispute that that happens um around
that kind of lending lending contract um so for us that's quite a big step forward because
as i mentioned you know working in the web 2 space many of the many of the peer-to-peer platforms
actually resolving disputes was was kind of the core to a lot of business success so um yeah that's
that's an example of how we see that we might be able to scale security i mean as i mentioned at
the beginning it's one one specific approach that we refer to as native bitcoin but we are hoping that
it will really allow us to get into that economic space that uh the the previous speaker really
flagged us as being the huge potential um for this next stage
thank you guys um i think very good points already have been made so the next thing that i just want
to discuss is about like people a lot of people actually have asked me personally and i've seen
uh uh you know many you know at many different panels that i've joined this question has been
asked and discussed whether the l2s uh bitcoin l2s will uh will exist in the coming cycles is it a
hype that we are seeing now just like we had you know we had nfts metaverses you know dows in the
previous cycle which still exists but you know most of the projects we have you know um we have
hopped and joplin basically uh disappeared somehow like i would say maybe 99 of those uh we're going
to be having the same thing with the current uh bitcoin ecosystem um what they call concept uh or maybe
storytelling is really a storytelling um so personally how i answer is this whether you call l2s
or not doesn't matter like the terminology but what we know is like even from um a mining perspective
like miners perspective basically miners are those who are securing a network and when you see uh
basically the profitability um in the coming 10 years there's no problem we basically it's too
profitable they will have enough incentives to continue mining but based on the researchers that
are actually showing the statistics after 10 years starting from 10 years on um basically they're not
going to be having enough incentives for miners you know to continue mining and that will definitely
result in uh you know a lot of problems uh like if they don't join join the forces then who's going
to be uh taking the role uh we need to create alternative ways and we actually have kind of you know succeeded
um uh in the previous months with in particular with runes or those runes and different bitcoin
relevant assets where um you know we had a lot of you know millions of dollars of transactions
in bitcoin and went directly to um to miners and they were quite happy because we have quite good
relationship with miners but englandia has just mentioned uh you know about a whales who are not
willing to put their bitcoin deposit their bitcoin into any like wallet psych in particular for those
um using npcs npc wallets that are you know multi-six which is not secure enough i mean i'm not giving
any specific uh names doesn't matter but you know definitely there are a lot of them um are uh you know
if we are here to usually usually users do not care about the tech um so here there is ui ux problem
and we can separately discuss this because that's really important if you really want if you really want to
onboard next billion people or next hundred million people uh because there's a those are the people
with zero background knowledge uh uh you know of blockchain um and when it comes to developers uh
they care about the security safety uh but are really l2s the current l2 solutions the sidechain
solutions decentralized decentralized enough so we we have this name decentralized bridge decentralized network
or should we just call them trust minimized because i i personally don't think that they're
you know there's like 100 decentralization on new bridges so um this is basically my my personal
question to you if there's anyone willing to answer to that we'll be happy so i love this as a topic
and i'm going to bring up the subject of dolphins before freaking love the term dolphins that's fantastic
um i think that's actually a worthy segment to go after i think that you know maybe the combination
of dolphins and we'll call them guppies i think that there is something there you know it's funny
we're launching mainnet in six weeks i mean it's soon you know we're really coming up on it we've
been building for a while and when we talk to bitcoin whales you know we had a one 30 minute chat with
one of the largest bitcoin whales in the world and he was very nice fellow and we had not interacted with
him before we didn't know him we reached out through an intermediary and he basically said
i ain't doing anything like it's not happening and i think that you're going to run into that level of
intransigence possibly even after you know that true decentralization has been achieved there are
just people who they have been doing things a certain way and they will continue to do things a
certain way they have a level of wealth that maybe doesn't demand that they grow their stack that
they go into btc phi and so on and they also are just distrustful if you think about
what a bitcoin whale is and perhaps any bitcoiner you know even if it's not a whale but just somebody
who has some bitcoin there's a distrust of institutions you know they've seen hyperinflation
in lebanon and argentina and venezuela they've seen that governments can you know take your wealth
away from you in two seconds and it's terrifying uh and even you know in other countries that maybe
don't have quite as acute an issue but they just like don't bother me basically and so you may not
get a level of participation with those entities even when we're two or three years down the road
and we're bitvm 97 you know it just might not happen and so i think that defining the goals here
is interesting i of course it would be great if michael saylor said okay i'm all in on name your
favorite btcl2 that's wonderful but maybe that's not necessarily the goal right now maybe it really is
to get the dolphins and the guppies and the tarpons and the piranhas and whatever and and go after it
that way and i think when you go back to that you do the absolute best that you can with security you
work on getting beyond npc solutions absolutely for sure that's very necessary i believe in
decentralization so does everybody on this call but again you know what is the use case and to me it is
the economic model i'm going to give a very very short spiel here but basically you talk about
miners maybe being priced out so what we're building is a proof of stake model that's linked
to decentralized sequencers decentralized sequencer is not common in this industry there are no btcl2s
that have one and so essentially what you do is you want to run a sequencer you stake at least 100
btc if not more so that btc can flow into the ecosystem that's a great start in exchange for that
you get revenue possibilities and you help control and run the network which is really great
so if you do that and you pair it with a native token native gas token that is just wrapped
btc well think about it you have bitcoin coming in your transactions accrue are paid in bitcoin
the revenue flows back to the sequencers you can tokenize that revenue and you could do all kinds
of fun stuff you could do pendle style decomposition of tokens and you could really achieve a true flywheel
and so that's really what we're trying to do is to address that is to address the potential
bottleneck in miners to address the fact that users might be a little skittish and to figure out
hey what's the fundamental question here we're trying to stack stats every single one of us on
this call would love to have more bitcoin than before and so if you can build an ecosystem that
enables that and gradually builds out the security i don't know i think that could be a winning
proposition
and just to just pick up on that i mean i think very much um you know in terms of the way that
we're thinking about how we develop this economics um it seems like a really powerful um um part forward
um i think also picking up on the point that hack and made about miners and adding value um using runes
i think i don't know how we describe miners as a as a fish um but um i do think that there's huge
potential in these models and some of the things that we're looking at is how do you reward um reward
can help miners get rewards on people running nodes in in other ways so for instance there's ok proof
node uh that might use a rune how can that be and maybe that's something that you could um we're
looking at how you distribute that via a mobile phone um so that we could try to uh probably be a guppy
in that case um but arbiter knows for example um maybe something that could be um create a greater
economic value for um for miners in the way that hackham was suggesting so i i really do think it's
very exciting for trying to open up those those new kind of markets because um you know there are
multiple different ways um that we can create create a new economics and new value in the system
um and and and i think this is one of the really exciting um opportunities uh for us all
thank you no more do you have any anything to add on this englandia
uh so i i'd like to add something that was mentioned earlier a lot about um um the discussion
around uh security budget so a lot of these so-called bitcoin layer twos don't really roll
transactions to bitcoin they're not really paying miners right uh some of them are are settling on
ethereum some are settling on their own uh chain altogether uh and what we're trying to do with
bitcoin os is is create uh a zk powered plug-in so that any layer could could um you know plug bitcoin's
uh security into their system so that they pay for and benefit from bitcoin security um in a way that is
uh one-to-one secure with with bitcoin approval work so uh it's great to hear that you know uh that
that there are other solutions uh out there that you know that are trying to use uh zk to kind of
connect bitcoin into this greater uh layer two modular ecosystem that that we're having
um so we we uh at bitcoin os we partnered with merlin chain um in effort to build a a truly trustless
uh btc bridge over to uh their layer two system they're very very bullish and excited
about um migrating over to our system so that you know they they can benefit from truly trustless
ptc rails no more managing an npc network no more overhead involved with that no more multi-sig
they can you know they can kind of open up um their their application ecosystem to all these whales
they're kind of waiting for a solution like this uh to to happen and we're we're uh repeating the same
thing with b square network and we're trying to um just open up this uh technology to to everyone
and just create uh a very robust and strong network of interoperable um and bitcoin grade secure rollups
great thank you um so maybe uh we can touch upon i think like a lot of comments that i i wanted to
make on this but because of the time limitationals keep talking much we'll be giving the mic mostly
to you guys uh but i think very uh useful information is being discussed and we're we're
recording this session as well so for those who are missing it uh can um listen uh you know to it later
on um so my question is about you know defy around bitcoin um so basically we have like we we have
uh we had bitcoin uh since 2008 and nine uh and then over the years basically we have we have seen
the debut of a lot of different uh networks like um ethereum and and its ecosystem a lot of others
basically the reason the reason mostly the reason was because bitcoin is not scalable uh and there's no
functionality on the top and there's that when you look at the white paper of bitcoin uh it just like
the abstract you can see it's like a peer-to-peer uh electronic cash system right it's um for payment
uh where you can use like many people are asking me this question are we really going to be able to use
bitcoin uh you know on a daily basis and you know while we're buying coffee uh you know having a lunch
so if if that if yes then when do you think will it will be possible because we have uh you know we have
been hearing a lot about the solutions okay we're scaling it we're bringing functionality but where
are we now at what stage we are so how do you guys see the defy um you know on bitcoin uh you know in
the coming years that's uh the first thing and how should we understand this bitcoin native approaches
like can it be somehow different from what we have been you know seeing uh you know with ethereum and
and all other relevant uh chains for the last i would say uh three four years five years uh what
should we understand uh you know bitcoin native approaches and do you think there is uh going to
be one single winner if if yes then do you do you think is there any um a killer app uh that we need or
we're expecting uh to come out to to get actually where we want it to be so anyone wants to grab the mic and
speak about that i don't think there's any scenario where there's going to be a single winner in
any industry i mean it's it's it's it's a nice narrative oh my goodness it's this one but look
there's always a number two and number three and whatever and it's a big space if you look at the
ethereum space how many l2s are there uh i don't know if you guys saw unit chain right unit chain is
uniswap is gonna have an l2 well polymarket's gonna have an l2 there's a lot of room for a lot of
um different protocols to do well and that's good you know there's a lot of different use cases
people are gonna have different comfort levels um i remember when i first got into the industry
just as a user i loved using phantom i just thought wow this is such cool imagery like it's so nice and
it's it's you know very fast and clean and whatever it's just spooky swap is fun you know these protocols
are fun so that's again maybe just a reflection of my personality but you're gonna have all kinds of
different ways of going about it so that's the first thing when you talk about uh payment i actually
think that it's the other way around um you know lightning network is not perfect by any means but
lightning record network has been facilitating payments for a really long time um and of course
solutions have only gotten better since then the issue is people's trust right you have bitcoin
holders um that's fine of course they're growing every day but they're still in the vast minority when
it comes to all of society and then you know beyond that it's a matter of vendors it's a matter of
governments it's a matter of regulation it's a matter of can you either make this legal tender or
at least make this something that you know becomes universally accessible accessible but there's a
tipping point with everything you know i am not 20 right so i've lived long enough that i've seen
things in all of society where oh well this is never going to happen and then it happens you know once
you have enough critical mass things flip so i think you'll see that final point on btc5
there's a lot of potential there and i would not be quick to poo poo what's happening on ethereum you
know there's been so much that's happened you know from the very beginnings of just very simple swaps to
lsts lrt's and so on and i think that that's you know to some extent low-hanging fruit for btc5 you
don't have to reinvent the wheel here we're seeing great protocols that can come on board and do a lot of
the same things that ethereum can but in the btc space i think of a protocol like avalon for example
that's a great borrow land that really excels in the btc space and is going to do very well in this
space and doesn't necessarily need to reinvent what constitutes a borrow land same with swaps
same with lsts same with lrt's and so on solve is a very powerful protocol within that space we've
already got a lot on the table it's just a matter of the networks that exist putting the ecosystems
together such that all the pieces fit together this one complements this one and so on and that's
just you know really understanding the space and understanding what users want too i think that
it's great build on a high level build top down as far as tech goes but really think about bottom up
again what is the user experience and how are these people going to make yield
in as safe and predictable and sustainable a model as possible
yeah and and and picking up on on on the idea that um that this is all about development of um you know
maybe apps at the top level i think one of the interesting i said the most interesting project
we're working on uh today um using the the protocol is uh a partnership with um harvard innovation labs
um and there there's a team um and these guys are 20 ish um that have taken the technology and
opportunity that it creates and looking to innovate a bitcoin backed stable coin um and that's something
that will be incubated in the harvard harvard innovation labs at their university um and and to me
this is exciting because it's it's really seeing kind of academia um obviously um investment but um
um importantly um talking to governments about how what could a bitcoin backed stable coin uh look
like how would it function um and at the highest level actually getting a bit carried away to be
honest um you know the idea is that this can help you know address some of those global liquidity issues
that were just just referenced and help manage uh the credit crisis and some of these hyper hyperinflation
situations um and i think if we can kind of develop uh solutions like that at working at that academic
academic level um then it will can sort of transform the whole potential um for the um
big fire ecosystem so um obviously that's quite quite ambitious and quite future looking um but i think
we've got to kind of shoot for some of those those higher level um solutions so that um we you know we can
really kind of create the sea change that i think that we all believe in um and again collaboration uh
is the critical thing here because um you know this is an academic group um you know um and we're for
for instance very keen to collaborate with um anyone in the space who who's sharing similar thoughts
around stable coins um so um yeah that's that you know that's i think the scale of the potential um and
and you know something we're really excited to see how it evolves as you say hack and it's kind of a
bit of an experiment but um if it comes comes off quickly then it could be some of the changes uh things
dramatically thank you ingo do you have anything to add or if not then basically i'm going to be moving to
the last one last question which is going to be about liquidity yeah we can we can move to the last
sure um basically we um john has just mentioned the the liquidity uh part which i believe is also
uh one of the problems that we are facing currently because what we observed is over the last few months
um users coming from you know other chains evm chains solanas and you know to coming bitcoin side they
don't usually have like they're not having the same experience that i have on on their side uh mostly
lack of liquidity um and so when we when we see um you know or think about who the main holders you
know the the big amount of bitcoin holders they're usually like bitcoin wells right uh like general users
defi users and and institutions recently which have recently joined the forces and
i as far as i remember only blackrock itself is is holding somewhere around like two percent of
the total supply of bitcoin and when you you know put all this institution that have joined and
purchased bitcoin um three etfs together uh it's around like i think what's already surpassed like
30 something billion dollars uh worth of bitcoin are being held uh by institutions which uh is making
them uh one of the biggest players now and in the space but can we really expect those institutions
to you know get involved in this uh you know d5 stuff part of ecosystem you know where they need to stake
and have yield i personally don't think so at least like in the short term uh because the lack of
regulations and still like uh i believe we we're not yet there but when it comes to miners
um is it because we we know they're both holders of you know a big amount of bitcoin uh and as well as
they're producing good amount of bitcoin hash rate on a daily basis like bitmain itself is one of the
largest bitcoin mining service provider which is also partnering with us we have really close
communication with them on a daily basis um so we're trying to like solve this liquidity problem
through tokenization of bitcoin ash rate where uh users can you know hold this assets in the form
of nft and you know mine bitcoin and then use this bitcoin on any d5 protocols on the top of bitcoin l2s
like bvm and other chains other l2s um you know where they you know uh make payments and you know like
gas fees in bitcoin which is also important in terms of incentivizing miners uh to secure the network
to continue secure the network and you know and so on so what and we have d5 users which i believe
um you know there are a few good um sidechains l2s that are doing pretty good job with users
engagements um uh with together with uh many bitcoin relevant assets uh like we already see 20s runes
ordinals they're pushing very hard for that and a lot of new users that already joined this through this
this assets but it's not enough we know this we need more when you look at this statistics and you
know all this tvl stuff there are a few chains that have enough liquidity but the rest of them actually
not look good enough so overall how do you guys approach this question how do you see uh the liquidity
problem um do you have any particular solutions that is it a kind of matter of time um so yeah the
floor is yours please pick up the mic sure i'll i'll take a crack at it so crypto does move fast even
even by institutional standards um you know you'd be surprised how many institutions are are um using
a lot of the ethereum defi applications like like ave you know that there will begin to be um
uh like defi use use cases that are institution friendly um and a little more regulated so i don't
see us like 10 years away from some version of that for for bitcoin um but i still think that we need to
figure some things out for having that one-to-one bitcoin grade security for layer two um and you know we've
we've had some conversations with um major asset managers and they really really do not want any
shortcuts when they are moving their precious bitcoin to defy they really don't want any type of bridges
they don't want even like the data being posted to another da layer other than uh bitcoin uh they they
truly want that one-to-one uh proof-of-work security um and i think that with bitcoin and west we've
i think we're on our way to figuring something like that and uh hopefully having some things live in
q1 um and by you know by then we'll see how the institutions react it'll be a big win for
um those defy dolphins and and maybe even the the fish to get involved
love that again bangers from you the whole time i've just been
uh enraptured good stuff from dolphins to the last point uh yeah you know i think as you said
um institutions will adapt uh there yes they want security but they're going to look for yield like
anybody else as mentioned uh always been an institutional quality doubt for quite a while
um and i think you're going to see that on btc too and and you know we can speak from experience we've
talked to large web 2 companies that infrastructure companies banks what have you and uh they are
definitely curious you know how fast is the onboarding going to take place we'll see but i
think it's also a matter of thinking about different models too so uh in our case what
we're doing by decentralizing our sequencer is we invite external node operators to participate
right so hashi and amber are two examples of and of course these are crypto companies
these are web 3 companies but they're running our sequencer nodes they understand the space very
well they're going to derive revenue from everything from block production to batching
transactions and so on uh partially control our network which is great you know as opposed to us
doing it just on our own the way that most l2s do and they can derive revenue but we talk
to institutions about this possibility too so that might be you know one of the ways into defy
is not necessarily hey i got a bag you're going to bring a hundred million dollars of btc
and throw it into a borrow land that might not happen right away but perhaps it's on the infra
level perhaps it's a large web 2 company and or financial institution they have some infra capabilities
and they'll come in and they'll run a node and participate in that way as opposed to just flat
out aping into a dap don't know you know we'll see that's one possibility uh so many smart people
on this call including the listeners it's possible that somebody here will come up with a better
solution so one way or another we're going to get there and you're going to see liquidity
uh flow into the ecosystem and and again even retail users are not used to btc5 this is pretty
new to everybody so it's just going to grow if this was a equivalent of a twitter spaces in 20
whatever 16 17 18 we'd be talking about the early days of ethereum defy maybe we wouldn't be able to
see the road map all that well because we just didn't know i think that's where we're at with btc5
to some extent yes we have the example from ethereum but we haven't really seen things play out yet
uh but of course user growth is going to happen because it's just crypto and blockchain is such a
wonderful place to earn yield to transact uh you know and of course bitcoin itself is such a nice
way to hedge against terrible global inflation all kinds of problems it's inevitable this stuff is
going to happen it's going to happen fast um yeah and i i would add uh picking up on in gala's point
um this this question about institutional grade security um i think is going to be a really key
factor so um i think we talked about you know the native bitcoin approach and making sure you've got
the um you've got that security um but i i think one of the challenges may be um at institutional level
they're going to want to know about identity uh and they're going they're going to want to sort of
protect against false actors in the system um and i i see this as a a challenge um to the to to how the
privacy um stories evolve because and this is i guess more in uh hakan's uh kind of sphere but
you know how how many people how much um and then anonymity can be protected um using web3 tools so that
the institution um has confidence that you know that this this is a um not a tainted piece of
money that they're dealing with so for me it's that trade-off or how we work around some of those
solutions uh between privacy and security um it's almost two sides of uh the same coin um and i'm you
know not you know i'm not sure exactly um how that will work but solving that for me will be a really
big step to opening up that institutional grade uh buy-in um so i don't know if anyone's got any
thoughts on on on how that might be might be resolved but um i do i do think uh it's an
additional issue and i do think web3 tools like decentralized identity uh verified credential vaults
etc can help help solve those issues um in parallel too so um you know that's that that's the
that's i think a strategic question um but that may that may come later down the line if you want
that full institutional grade security thank you john yes i i believe like we can even talk about the
ids but this actually twitter space easily could be like two three hours long um but that's that's i
uh you know my i i wanted to you know um make this was an hour which we already like came to the end of
uh did this session um so we have discussed a lot about uh i think different things like how we see
bitcoin like current l2 ecosystem and what we are expecting from bitcoin defy in the coming years
um current solutions and then um decentralization um you know uh in the ecosystem a lot there are a lot
other to cover but again uh we're already coming to the end of this session so one last question um i
want each of you guys to just give some you know positive vibes positive messages to those builders um
there are new builders um users in the space that are trying to understand and want to make sure uh that
they're on the right uh on you know on the right uh way uh doing the right thing so if you were to give
a message like in two max three sentences what would you be saying to those developers and users
um you know in terms of you know building in the bitcoin ecosystem and being part of this uh this force
um since this session is being recorded um we're going to get back to the you know this um recorded
session maybe next year and then have another conversation based on this and see what improvements
have been you know in the space and uh we will be talking about something else yes maybe we anyone
want to jump on that like again just positive messages within two three sentences
sure so uh i guess i want to give uh hakan and bvm a big shout out thanks for having me on this was
a great a great talk with you guys um zk on bitcoin is here i think we can take bitcoin to the next
level of programmability and scalability and um compatibility with with the greater you know modular
web3 ecosystem that we have come build with us btc underscore os become a boss build with us uh follow us
and uh thanks a lot for having me
i'll jump in uh sustainable yield that's what we're all seeking
that's what we're building at goat network and it is achievable um you know by a decentralized
sequencer model the idea of combining decentralization with making money pretty interesting and fun idea
so go dot network is our website you can follow us on x at goat roll up and we are launching mainnet
about six weeks from today there will be a bunch of great d5 daps telegram mini games all kinds of
cool stuff so maybe you're just a beginner in the btc space whatever uh but uh yeah come check us out and
uh again thanks to bvm and uh this was really fun and uh really enjoyed the other speakers as well
everybody did an awesome job thank you for this well and it definitely looks like um zk proofs are
are a key a key part of whatever the future holds but you know what's been really impressed really
impresses me is just the scale of the opportunity um and how the how these different um solutions
whether they're uh whether for guppies of uh different kinds of fish um or all the or the whales
even at some point in time the opportunities just seem uh you know such such on such huge scale that
i guess it's a question about how do we how do we kind of solve some of the really specific problems
we've we've talked about today um and this key point on collaboration uh working with academics
regulators um and trying to make sure that um you know sort of the the whole idea of the uh bitcoin
economy uh achieves the scale that it really should do because um you know from from our point of view
we're we're so excited about how how we can contribute as i mentioned to earlier to this
kind of almost this new breton woods solution um you know this is the this is for reference
to the conference that happened post-war where people got together to figure out how gold can add
liquidity to the system um we really do believe that um if we can all collaborate um on these kind of
solutions um then we can really help address what is a serious credit crisis in the world right now so
um on a positive note um to solve a big problem that that's where um i would end
thank you guys i would personally really enjoy the conversation with you again like this we can
easily make this twitter space uh like two three hour long there are a lot of other things that we
haven't covered um it's really like i believe there are a lot of uh good messages that are coming from
the community that are listening to us now they really also enjoy the conversation so um big thanks
to last us uh code network um and bitcoin os for their support being part of that uh thank you john uh
thank you dane and glandy has just you know uh um uh left so i wish you a lovely day and look forward to
to the next opportunity so yeah enjoy your day thank you thank you
