Transcript 0:00 Proof of reserves is never proof of solvency. So now we get to the really interesting spot of some of these new systems, where a lot of them are excited about Bitcoin Season 2, just like you [laughs], you know? 0:11 And I mean, just like me. And, and so there was a gold rush. But they made some exceptions. So I, I call this, uh, TVL mirroring. 0:19 And it was really, especially about a year ago, it was all the rage, um, as this, as this Bitcoin Season 2 narrative started. 0:25 And what people do is they say, "Hey, um, I wanna launch a new product, uh, a n- a new Bitcoin product. I really wanna show how big and important my product is. 0:34 So I need to get a bunch of people to put their money at risk and show how they believe in me." But then the people with money are like, "I don't, [laughs] I don't wanna do that. 0:41 Uh, I do wanna make money, uh, on you, and I do think that one day you might do something interesting, but not today. So here's what I'll do. 0:48 I'll move the money to a wallet that I control, and you can tell everyone that you control it." And actually, it turns out, I, I don't wanna call it an industry standard [laughs], but this became a very popular thing. 0:59 [upbeat music] Welcome back to Bitcoin Season 2. 1:13 I'm Charlie Spears with Blockspace Media, and I've got Matt Luongo of Thesis with me to talk about the landscape of wrapped, staked, bridged Bitcoin, and the cross-chain Bitcoin economy. 1:25 Before that, I want to thank our sponsor, Arch Network, and invite all the new listeners at Coindesk. Thanks for tuning in. 1:32 Make sure to hit up Bitcoin Season 2 at BTCZN2 on Twitter, and our parent company, Blockspace Media, Blockspacepod, also on Twitter. So if you're wondering what Bitcoin Season 2 is, join the club. 1:45 We're kind of figuring it out as we go. Um, basically, there's been a lot happening on Bitcoin lately, and we're going to cover all of it. It's ordinals, Bitcoin technical debates, layer 2s, everything in between. 1:56 But before I get too deep, let me bring up Matt. Welcome back to Bitcoin Season 2, Matt. Hey, Charlie. Thanks for having me. Yeah. So, um, pretty big week for you guys. You, you... 2:09 Thesis has a bunch of companies under it, one of which is Fold, going public next week. But, um, 10, 15 seconds, who are you? Where have you been in the Bitcoin space? [laughs] Uh, yeah. That's hard in 15. Um, yeah. Hi. 2:22 Uh, well, originally I was the co-founder of Fold, uh, which is a Bitcoin-backed, uh, debit card. They're getting ready to launch a Bitcoin-backed, uh, credit card. 2:31 And, uh, they, they also happen to about to be listed on the NASDAQ, so quite excited, quite excited for that to happen. Um, but since then, uh, I run a, a crypto venture studio. And I say crypto. 2:42 I run a Bitcoin venture studio. We focus on products that are, um, bring utility to Bitcoin, economic, technical. Um, so yeah. So, so one of those is tBTC, which is, um, a Bitcoin bridge. 2:54 I imagine we'll talk a little bit about an alternative to... I mean, it's wrapped. It's another version of wrapped BTC. 2:59 Um, and then another is Meso, which is, uh, an upcoming Bitcoin side chain that, uh, I think, uh, is gonna be a big part of Bitcoin Season 2. Yeah. And that's why I have you on here again. 3:09 You're kind of a recurring guest in the Bitcoin Season 2 podcast universe. Um, but we're gonna talk about, like, the landscape. 3:16 I'm gonna use the term wrapped Bitcoin, but I think we're still kind of figuring out, like, what the right term is. So for the Coindesk listener, um, let's just start from the top with some basics. 3:26 Like, what does it mean to, finger quotes, "wrap" Bitcoin, and why do people do this? Yeah. Yeah. So it's kind of a controversial term, right? Because, uh, you know, just like, uh, not every tissue is Kleenex. Yeah. 3:41 But, uh, WBTC was the first, uh, popular wrapped Bitcoin product. And it's a custodial bridge. 3:48 So what I mean is, like, you send your Bitcoin to a counterparty, and they give you a receipt, uh, on Ethereum and, and now a bunch of other chains that let you... 3:56 and let you use that receipt in DeFi and, and for whatever. You can sell it. You can borrow against it. 4:02 Um, the, the term's controversial, not only because it's kinda like the brand, but also people are like, "Oh, well, the way that I use Bitcoin, it's not wrapped." Y'all, wrapped is not a technical term. 4:14 [laughs] And, and if you're doing anything with Bitcoin, uh, that's, uh, interesting, you know, uh, if, if you're, if you're doing anything that you sh- you think should use Covenants or, you know. It is, it is wrapped. 4:26 It, it... We're all waiting. We're all waiting on Opcat, or we're all waiting on Opt- Opt-CTB. 4:31 So most of the cool new stuff that we do with Bitcoin, um, either it's like a meta protocol, so it doesn't require a change from Bitcoin, um, or, um, there are a few things that you can do, like what Lava does for loans. 4:43 Very cool. But for the most part, if it's something new and it's in Bitcoin, there's wrapping somewhere, and people just kinda try to maybe hide where. 4:53 So, uh, like, let's talk about the different, like, different types of wrapped Bitcoin. I'll maybe use this. 4:59 I think one of the themes I'm trying to identify in Bitcoin Season 2 is you have this whole, like, um, corporate treasury type of Bitcoin, which is on, you know, MicroStrategy or, like, a BlackRock ETF. 5:10 But this- Yeah, that's one kind of wrapped Bitcoin. [laughs] Yeah. 5:13 Well, this, uh, this might be a good question to come back to, but, like, when I think about it, I'm thinking about, like, Bitcoin we kinda use in the on-chain, cross-chain ecosystem. Like, what are the diff... 5:23 You, you mentioned this thing called bridging. You mentioned, like, different types of custodians. Can you elucidate a little bit, like, what this looks like or how different- Yeah... versions work? Yeah. Yeah. 5:33 Well, let's, like, go backward to go forward. 5:35 So, you know, um, back in the day when Lightning w- wasn't what it is today and, and it didn't work yet, and we didn't have all the soft forks on Bitcoin for it to work, you know, the idea with Lightning was it's a layer 2. 5:49 And what that meant at the time is we meant that it, um, it extended Bitcoin 5:55 with similar, relaxed, but similar trust assumptions, and that it would let you use your Bitcoin faster.Um, and there were ideas that would let you do other things, uh, that would let you do things that your Bitcoin couldn't do normally. 6:09 Um, but we weren't really sure what, what all those things were. Uh, you know, fast-forward to today, um, we've decided everything is an L2 or nothing is an L2. 6:17 This whole idea of there's layers and bridging, it's all, all complicated. Uh, I, I think there's a whole generation of Bitcoiners who think that, you know, for all intents and purposes, Coinbase is an L2. 6:27 So th- I think the way to look at this is like, look, we have this asset, it's Bitcoin, it's pristine, it's fantastic collateral. We have this network that's the Bitcoin network. 6:38 And from one perspective, it is an incredible marvel of engineering. It doesn't go down. It works. Some of the brightest minds in the world try to hack it. Nothing. 6:48 From another perspective, it's very difficult to work with in newer systems. Extending it is quite difficult. Uh, none of us want our nodes to, to be hard to run. 6:57 Uh, a- but, but, uh, you know, you would call it kind of legacy code. Brilliant legacy code, the same way that maybe some, some, some code bases are on airplanes. 7:05 Not something you should rip out and throw away, [chuckles] but also kind of difficult to work with. So, so that's the position we find ourselves in. 7:11 So as a user, you know, I think y- y- you have Bitcoin, and whether it's in an exchange, so that's custodial, whether it's on your ledger, which is self-custody, or, um, whether it's on another chain, uh, which is, you know, somehow it's bridged or somehow it's wrapped, um, 7:30 hopefully your experience is just that you're using Bitcoin. And I think, um, unfortunately, people have to kind of learn a little bit more than that today because not all these things are safe. 7:39 [upbeat music] Let me tell you about one of the most slept-on opportunities in crypto. Arch is building fast, composable DeFi apps on Bitcoin. 7:48 Arch apps tap into the OG blockchain with by far the most liquidity and best brand in crypto. I've known the team for over a year. The tech they're building is solid, and they are racing towards mainnet. 7:59 There's DEXs like Saturn, meme coins on FunkyBit.Fun, instant loans on Cha-Ching, and so much more. Plus, they're rewarding testnet users, so join me in trying out Arch while it's still early. 8:11 And we will get into, you know, as the episode goes on, we'll probably get deeper into some of the specifics. But could you describe to me, like, um, some of the trust assumptions people are making when they're using, 8:25 um, a coup- maybe a couple of the predominant kind wrapped Bitcoin products? Yeah. So, um, so WBTC, which w- which was kind of the OG, uh, w- was a BitGo product for a long time. 8:38 And, um, and the assumption was you were trusting BitGo's custody. There's a multisig, but BitGo does custody, all the keys to the multisig. So it's not economically disparate parties. Collusion is trivial. Um, 8:53 then the Bitcoin legally was held by a trust in the US. So it turns out, like, when you're a custodian, it... When you can count a number of custodians on one hand, th- the law really matters. 9:04 And so, uh, the Bitcoin was held in the trust. So wh- what does that mean? It means it's bankruptcy remote. So BitGo could go under, the trust would be fine. The Bitcoin would, would be legally unencumbered. 9:14 Um, but if someone found those key shares, yeah, the, the Bitcoin could be gone. And so, um, earlier th- or, like, late last year, BitGo actually made a change. 9:25 So this is one of the things that we all have to understand about this. There's the model that we think we're getting into, and then there's, well, who can change the model? 9:32 And so BitGo made a change, and originally I think the idea was to... And I, and I'm not them, so I can't speak for them. But I think the idea was to make it so that the US couldn't unilaterally freeze this money, right? 9:44 That's me steelmanning what they did. Then what they did was pretty interesting. 9:48 They took this to a three model and they said, "Well, I don't know if you guys are familiar with Justin Sun, but we think he would be a great key shareholder." 9:55 [chuckles] He, he's a very- For this- He's a well-known listener. He's, uh, the co-founder of the Tron DAO. Uh, one might say he is the Tron DAO. Um, yeah, he's, uh, he's crypto's favorite bad boy, you might say. He's... 10:07 Yeah, he's a controversial figure. Yeah. And I mean, um, you know, regardless of, of how you feel about Justin, uh, he has been involved with stablecoins where he took over and then the treasury was raided. 10:16 And so, you know, I can't, I can't say he did this or he did that. Uh, I, I know that, uh, some of these changes, they eventually led to Coinbase, though, deciding to delist WBTC. 10:29 And, um, and so that, that was salacious too. So there's all sorts of tea here. But, um, but yeah, so that's the idea. 10:34 It's like, uh, y- ultimately, though, there's a custodian or there's maybe two or three and, and that's kind of the model that, that WBTC uses. Now, some of these other variants, um, 10:45 powering, powering these chains do some things that are pretty different. Yeah. So there's been a lot of shakeup in the past year. 10:53 I mean, I had you on an episode I think last summer, kind of as some of the initial, you know, things were being moved and a lot of the repositioning. 11:02 It's been pretty interesting because, um, I use our friends over at Bitcoin Layers, uh, Yannis and Red have a really good research product that show that if we're gonna hand wave here, there's s- over three hundred thousand or so accounted for Bitcoin wrapped across chain. 11:20 That's like- Yeah, we think. [chuckles] Yeah, we think. We- we- They're, they're doing their best to be sure. Yeah. Exactly. This is why [chuckles] I reference them- Yeah... 'cause they're-- it is a hard thing to track. 11:29 But, you know- Yeah, it's really tough... that... Yeah, so that, that- I mean, it shouldn't be. It should be the easiest thing in the world, but, uh, the market has not made it easy. 11:35 [chuckles] I-- Let's just get right into it. Yeah. Why is it not easy, Matt? What are some of the hard things? Okay. Well, [chuckles] 11:43 let me talk about what we did in twenty twenty a- and, and then maybe use, maybe use one of our products as sort of like a, like a comparison to some of these other folks in the market. 11:51 So, um, we saw WBTC, we thought it was really cool.Uh, we wanted to see a more decentralized version. And, and so, uh, back in twenty twenty we launched something called tBTC. 12:01 And, uh, tBTC, the first version, had a security model that was sort of like top-notch. Um, didn't scale as well. 12:09 Uh, and then the second version, which launched a little bit later, is more scalable, slightly relaxed security model. 12:14 But the key that you need to remember for both of these, and really for almost any bridge model you're gonna hear about until there's a soft fork in Bitcoin, is this idea of an honest majority. 12:23 So the requirement is this: You have a bunch of people who are not you, who are custodying your Bitcoin for you. Are they honest? And so when people say an honest majority, they mean this system is secure if you assume 12:39 that the majority is honest. So, like, if you point at a random group of people, like, I don't know, on the subway or something, and you're like, "Okay, here's, like, n-nine people. 12:50 Uh, if five of them agree, they can have my million dollars in this suitcase," and you put the suitcase down. 12:56 But you tell them all, "I really don't want you to take my money, and I don't give you permission, but you have the power." The question is, like, will they take it? 13:04 And for some groups of people they will, for some groups of people they won't. The bigger you make that number, the more difficult it is for them to collude. 13:10 But also, like, the people you choose from really matter, right? If, if you, if you, um, if you choose a bunch of people that are high rep and highly respected, you're probably gonna feel a lot better. 13:19 And if you choose a bunch of people that for whatever reason you don't like or that wish you ill, you're probably not gonna feel good about your money. So that's, that's the core honesty assumption. 13:27 And even in BitGo and WBTC, you see that. Well, it was an honest majority. It was one of one for BitGo, so it was an honest majority. And then it was two of three. 13:36 It's BitGo, uh, Justin Sun's, uh, BitGlobal, and then an-another part of BitGo. Um, so, so that's like this core [chuckles] idea that we need to keep in mind. 13:46 But then you start looking at some of these other, other products. 13:49 Um, so when we shipped tBTC, we said, "Well, if we're doing this on-chain and we're doing it maximally decentralized, it should have proof of reserves built in. Should be doing that at all times, every day. 14:02 Um, it should be really obvious to people where the Bitcoin is going." And, um, and so that's how it works. Uh, we, we, you know, there's a, there's a page. There's a, like, there's a... 14:11 It looks almost like a block explorer. There's p- tBTCplus.com. You see you get those addresses. Yeah. We know who the signers are. Yeah. You see the addresses. You don't know who the signers are. 14:18 And like, here's your Bitcoin, and this is what they're doing with it. Yeah. Yeah. It's, like, pretty clear. Yeah. It's great. Yeah. So why do the Bitcoin layers people have trouble figuring out- Yeah. [laughs]... 14:26 how much Bitcoin is wrapped? So I think that that's table stakes. And, and to be clear, that's something that WBTC did very well. Like, that's something they also thought was table... 14:36 A-anyone who's done professional custody work I think would agree that, like, proof of reserves in this day and age is table stakes. 14:41 Um, but the thing to remember about proof of reserves is even when it's implemented perfectly, proof of reserves is never proof of solvency. 14:49 So if you see proof of reserves, the thing that was interesting about what BitGo did with WBTC is they proved their reserves, and they had a trust. So you knew that there wasn't a loan against the reserves. 14:59 But then you look at tBTC and the Threshold network, they proof reserves. Now, if they were all some company, you could imagine some legal setup where there's liability, and actually there's a loan against the Bitcoin. 15:10 Now, because you can see that they're all independent entities, okay, you're pretty sure that there's not a liability. 15:14 So now we get to the really interesting spot of some of these new systems, where a lot of them are excited about Bitcoin season two, just like you [chuckles], you know? And I mean, just like me. 15:24 And, and so there was a gold rush. And so we've seen all these systems grow very, very quickly, and a lot of them are using centralized custody, which is a trade-off. 15:34 And if a user decides to do it, just like they decide to use an exchange, that's their right. 15:38 But they made some exceptions around either they don't publish proof of reserves or, and this one's my favorite, they publish proof of reserves, but they actually do not require the underlying Bitcoin to be custodied. 15:54 So I, I call this, uh, TVL mirroring, and it's a really fun... It was really, especially about a year ago, it was all the rage, um, as this, as this Bitcoin season two narrative started. 16:06 And what people do is they say, "Hey, um, I wanna launch a new product, uh, a n- a new Bitcoin product. 16:12 I really wanna show how big and important my product is, so I need to get a bunch of people to put their money at risk and show how they believe in me." 16:19 But then the people with money are like, "I don't, [chuckles] I don't wanna do that. Like, uh, I do wanna make money, uh, on you, and I do think that one day you might do something interesting, but not today. 16:30 So here's what I'll do. I'll move the money to a wallet that I control, and you can tell everyone that you control it." 16:37 And actually, it turns out, I, I don't wanna call it an industry standard, [chuckles] but this became a very popular thing, uh, last year. 16:44 So we're starting to see, like, if you're, if you're, you know, if you're the Bitcoin layers team, you're in a hard spot, because now you're like, okay, people look like they've published proof of reserves, but a third party can move the funds without impacting the receipt token. 16:58 So that's like if BitGo gave out WBTC, and whenever it wanted it was like, "I'm gonna move, like, five thousand Bitcoin, but just, like, don't worry about it." You can see it on-chain, but it's still there. 17:08 So that's, that's what's kinda going on right now. 17:11 Hey, this is Will with Blockspace Media, and I don't know if you heard, but we just announced the second edition of our conference series, OpNext, now to be held at the MicroStrategy HQ in Tysons, Virginia. That's right. 17:24 After the success of our first scaling conference at Fidelity last fall, we're doing it again this spring, April eleventh and twelfth, at the MicroStrategy HQ. I'm really excited for the programming. 17:34 We have various stakeholders, industry, developers, and Bitcoin miners present. 17:39 So join us in April for open, neutral, and honest conversation about the leading proposals and technical solutions that will scale Bitcoin to the next billion users. No booths, no tokens, no shills. 17:52 Just Bitcoin and honest conversation. You can find tickets and more information at opnext.dev or click below in the show notes.The- yeah, this is really interesting. 18:05 And so now we're looking at three hundred and twenty-seven or so. They're doing their best to figure out how much Bitcoin might th-this account for, which is thirty billion dollars. 18:13 And if we were to like, this is probably the, maybe the most accurate assumption we, we can make. Uh, yeah, well, we could probably dig into it, but again, that gets... 18:22 We'd have to get into the dirty weeds of some of the details. But like, this is a big economy, Matt. Like, this is a thirty billion dollar economy. 18:30 Now, if we were to like look at like, everybody likes to like, they're moths to a flame to the MicroStrategy Treasury. They love to see how much more money MicroStrategy or Strategy now is gonna yeet into Bitcoin. 18:42 And, um, but like, if you look at the other known private companies out there, 18:47 um, and their known private treasuries, uh, like now three hundred and twenty-seven thousand Bitcoin actually rivals that of like the Tesla- Yeah Plus Block- I mean, and it's approaching, it's approaching rivaling the strategy itself, right? 19:00 Exactly. It's, it's a stone's throw. Yeah. Which is really interesting 'cause this brings up an interesting phenomenon. 19:05 Like we're looking at the emergence of, um, I would alm- I'm-- maybe I'm trying to make this like narrative happen, but I would say like, it's like the corporate treasury Bitcoin, the sovereign treasury Bitcoin versus the on-chain economy, like- No. 19:18 Bitcoin. It's real. Yeah. I, I actually think you can take it a step further. 19:21 I think you can, you can take the ETF and combine it with the corporate treasury Bitcoin, and you can kinda be like the legally wrapped Bitcoin and the technically wrapped Bitcoin, you know? Yeah. 19:33 Because they let you do similar things. You can borrow against your legally wrapped Bitcoin. You can borrow against your technically wrapped Bitcoin. One requires a brokerage and KYC, and this, that, and the other. 19:43 One requires an understanding of nodes and a wallet. So where do you think the... Where do you-- what do you think the role of this technically wrapped Bitcoin used across the crypt economy? 19:53 Where do you-- what do you think the role of that is? Like- Ah. 19:56 Man, you're asking me for my bullish take, but I gotta, I gotta let, I gotta, I'm gonna ask- Give me a real, give me a real- I'm gonna ask myself- Give me your real opinion. Yeah. 20:02 I'm gonna ask myself the question I want you to ask, and then let's come back to that. Yeah. And the question I want you to ask is, how much of that three hundred thousand BTC is real? That's the question I want. Yeah. 20:10 What do you think? Yeah. Uh, I, I think that maybe max sixty percent of it is real on the, like... 20:18 I'm struggling, and, uh, i-in terms of it, I mean, you know, maybe a little higher if we just mean it exists at all, if that's our, if our, that's our bar. But if our bar is at risk and actually backing the protocols- 20:31 Hmm. A little south of fifty percent. Ooh, that is- This is rough I see. That, that feels- This is rough... to me like, um, this feels to me like some of the, the egregious overextensions of last bull cycle to me. 20:47 I mean, that seems like- Little bit... that feels like a, like a FTX never had the Bitcoin to begin with, or is maybe they're a middle ground of like... Yeah, I mean, I think, you know, the on- first, uh, it... 20:59 I might be, I might be cutting a little too deep 'cause I'm like doing the math in my head. I, I, so, you know, I, I don't, I don't wanna name offenders- But it's not ninety is kind of what, is what I hear. 21:08 It's not ninety. Yeah. It's definitely not ninety. Yeah, 'cause, 'cause I look at like, look, the WBTC appears to be there from the most recent proof reserves, and the, uh... and like, I don't have a lot of reason. 21:19 Another, the next biggest POC is probably Babylon. And so like between those, you're like, "Okay, okay, we got, we got across, maybe we got across fifty percent." But like, then it starts getting real touch and go. 21:28 [laughs] So... Yeah. So, um, let's go back to the original question is, so like what is the future? 21:36 Uh, let's just say, you know, we're not gonna concern ourselves with what the Bitcoin's real or not, but it is demanded across the crypto ecosystem. 21:42 Like, do, does the, does the world of like technically wrapped on-chain, cross-chain Bitcoin, does it play a different role in the growth of our Bitcoin economy? It does. Yeah. It, it, it... for two reasons. 21:56 So one, i- and I, I try to tell people this, and they don't, they don't get it, especially, I mean, I'm engineer-coded, so I struggle with this too. But like new Bitcoiners today, 22:06 they didn't buy on Coinbase or, you know, w-well, choose your favorite, uh, Fold or, or I don't know, not Swan River. They didn't, you know, they didn't buy any of these places. 22:17 Uh, they bought the ETF or they bought Strategy. And, uh, and so that's where our new holders are coming from. 22:24 And so when you look at the funnel of like, I started an exchange, and then I decided to self-custody, and then I learned about Lightning, for example, or, or then I went to TBTC or WBTC, that's like a pretty deep, gnarly, hobbyist funnel. 22:38 And, um, and the reason I'm so interested in this is because the value in that funnel accrues at the top and at the bottom, and the stuff in the middle, not really where you wanna be. 22:47 That's how I think of it as a startup guy. So the ETFs, that's a new layer. When we get in-kind redemptions, that layer will drop down from the ETF down to exchanges and, and other custodians. 22:58 But right now, it's, it's of its own. 23:00 So all these people who have bought into the ETF, and definitely anyone who's bought into MicroStrategy, 'cause that's not gonna get in-kind redemptions, um, all those people, they don't have anywhere to go. So, 23:09 so on the one hand, we're kind of like bifurcating all these people, and all of the new users and all of the retail are coming from the traditional stock market in this cycle. 23:18 So when people ask like, [sighs] "Man, when my alt's gonna go up? What's the beta to Bitcoin?" And the answer is, well, why? Why would it when everything's on the stock market? It's not... 23:29 You don't need the, you know, some, some random Bitcoin clone. So that's like, that's one take, right? Is that, uh, is that the growth is, is with like the TradFi, illegally reps. How I feel though 23:42 is long term, if that's all we've built, it's not enough. Yeah. I'd be- That's not success. Yeah. I'd be disappointed. Yeah. And so I think long term, we need to find a way to help these people to self-custody. 23:55 We need to make it easy. It's not easy today. Um, and I love when someone else who's been in the space for a while, "No, it's easy. It's gotten so much easier." It's not easy. 24:04 Talk to your family that doesn't know what you do. Get, get them to, you know, just do like a quick user test. It's not. 24:10 So I think, I think it's, our challenge is gonna be, okay, when we have in, in-kind redemptions turn on-Who's gonna be ready to accept all that money and help it find its way to self-custody? 24:22 And so I, I think that's the new funnel, um, for Bitcoin users. 24:26 Well, this gets into how I kinda like to wrap most conversations up here, [chuckles] which is, um, I take touch points on where people are on the topic of soft forks. 24:38 You brought it up at the top, and one of the, one of the, like, very simple 24:46 pitches of some of these software proposals out there, if you're a Coindesk listener, don't know what I'm talking about, this is something you'll have to listen to more episodes to learn more about. 24:54 But for the maybe longtime, more technical listener, like, a lot of these soft forks say they make the self-custody experience, they make the onboard experience easier. 25:02 They make the reason to touch Bitcoin more directly, um, mu-much more compelling. What are your thoughts on the, the soft fork discussion? Do you have opinions? How does this apply to your work? Of course. Yeah. 25:17 So I think I've got, I've got a, I've got, like, a please do your homework opinion and, and a, and my bags and, and my direction opinion. 25:26 So the please do your homework opinion is like, look, if we don't scale self-custody, this was the most boring replacement to, you know, money under your mattress, and I-- and, and, and, and, and we have truly sucked the joy and the interesting stuff out of Bitcoin, like, if, if we do not try to s- to scale self-custody. 25:44 And I think so much power and appreciation to the Lightning folks who've, who've worked on this, but, like, we're not done. We need to be able to, to, to look at other things. 25:52 We need, we need ARC, we need UTXoShare, and we need, we need all sorts of other approaches. Um, that said, uh, I have-- a-and, and to be clear, to do that in a trust minimized way, we do need a soft fork, so full stop. 26:07 That said, I learned a long time ago not to build a company around changing Bitcoin. 26:13 Like, if you, if you're gonna choose one thing in the world that you wanna change, you know, it, it was easier for Elon, uh, to change the US president than it is for him to change Bitcoin. 26:22 It-it-- you know, it's, it's, it's not [chuckles] it's, it's, uh... When we say immutable, we mean it in the gnarly way as well as, as well as the way we all like. 26:30 So, um, so I guess I would just say, like, for example, like, Taproot Wizards, like, ballsy. Raise the money, do the thing specifically to change Bitcoin. And you know what? They, they're cult builders. Maybe they will. 26:41 Um, but, like, for me, I'm like, you know, the more we argue, the less likely Bitcoin is to change typically. That's the experience I've had in past cycles. So, um, so yeah. 26:49 So all that said, look, if you're, if you are an individual or a miner or a holder, please, um, signal for OTV or CTV, excuse me, or even CAT. I don't know. 26:58 I don't-- I actually don't care as long as we have a rough consensus. If you're a startup founder, though, you need to have a solution in the middle because people want stuff today, and they're all going to the ETFs. 27:08 So, like, get your act together, you know? Man, that's, uh, very well spoken, Matt. I feel like we had a very, very productive conversation in twenty-five minutes. Um, where do we take this? 27:20 What are your last thoughts on this conversation? Yeah, final thoughts. Um, look, uh, what I'm working on, w-we were, we were early to this Bitcoin bridging thing by four or five years. 27:31 Um, sometimes being early is being wrong, sometimes it's being early. I don't know. Uh, but where I'm at next is I wanna see people be able to live off Bitcoin. 27:40 And what that meant when I first got in this space in twenty fourteen meant, oh, sell it for gift cards. That's what Fold originally did. Today, that means taking out loans. 27:49 So imagine if we can take out non-custodial loans against our BTC to live. So anyway, that's, that's what I want people to be thinking about. That's what we're working on with Meso. 27:58 It turns out that's also how I financed my house. So anyway, I'll save that story for, for maybe another, uh, another, uh, time. I feel like we should have talked about this before. 28:06 I'm currently broadcasting- [laughs]... from a house that I, uh, did a similar thing with. So shout out to all- It's a pain. It's a pain, but I'm also surprised that it can work. 28:16 So, um, well, here's to the, here's to the future of improving the Bitcoin onboarding and self-custody experience. Matt, thank you so much for coming on Bitcoin Season Two. Thanks, Charlie. 28:26 [upbeat music]
