EP67 Bitcoin podcast with @ErgoBTC

Bitcoin is close to becoming worthless.

Now, what's the Bitcoin? Bitcoin's like rat poison. Yeah! Oh. The greatest scam in history. Let's get it. Bitcoin will go to fucking zero.

Alright, you ungovernable misfits. I'm your host, Max. Everybody knows that Bitcoin is useless, worthless, and doomed to fail. But what if everyone's wrong? What if it's the system that is doomed to fail?

Join me as I speak to some of the brightest people in the space and slither to the deepest, darkest depths of the Bitcoin rabbit hole. Welcome back, everyone. Today's guest is Ergo BTC. I've been looking forward to this for a long time.

Ergo did not disappoint. Before we dive in, I just want to say thanks very much to my show sponsors, CoinFlow UK. If you are going to use a KYC service, make sure it's one with a great team, one who takes security very, very seriously.

And after you've done that, think carefully when you take those coins off exchange about what you're doing, listen to what Ergo's saying because there are creepy, creepy people out there like him and others who know what you're doing, where you're spending your money.

And that's not always a good thing. So think carefully and take steps to better your privacy. Enjoy. Hey Ergo. Hey. I think we're all good now. Your privacy is so good that I can't even record with you.

I know it's just Firefox being Firefox. How are you doing? Good man. How are you? Very, very well. I'm very excited to have you on the show and it's been a long time coming. I've been sort of trying to get more and more into this privacy stuff and learn more and more and I stayed up all night last night listening again

through your discussion on Citadel Dispatch with Bitcoin Q&A and with Matt. Just trying to wrap my head around some of the stuff you guys are talking about. And a lot of it I get lost with, but I thought this would be a great opportunity to dig in a little bit deeper and speak to the master.

But I have been warned, I have been warned not to speak to you for too long. Because you can track me through ten of the thing. Is that Elmo? Is Elmo out there? No, that's Bitcoin Q&A gave me that warning.

He's a smart ass. No, Elmo, Elmo jumped on our show last night and asked some very, very weird questions. But no, that wasn't from him. But yeah, no, great to have you on. Thanks for doing it.

And like I said to you before, there's no sort of direction, particularly I want to take it. I'm chatting to Bitcoiners, people who are privacy focused and that's it. Yeah, cool, cool. I mean, this will be good.

I'm sure that whatever questions you have, other people will have as well. I mean, I still really haven't done like a very basic podcast yet, so this is going to be great. I'm looking forward to it.

Yeah. And so before we sort of dive into anything technical, obviously I've listened to that and a couple of other pods and bits and pieces, but I'm still not so sure really how this all came about, how you're doing, what you're doing, how you found Bitcoin, why you care

about privacy and what sort of got you down this rabbit hole in the first place. Yeah. Yeah. I mean, that's a good place to start. Yeah, I'm kind of like, I guess, a lot of Bitcoiners, you know, sort of come to it from Austrian economics, you know, libertarianism.

And I sort of hung around, I guess, Fintuit, you know, for a little while, you know, a little bit of gold bug stuff hanging around on zero hedge and, you know, eventually kind of stumbled on, you know, Bitcoin, just kind of like everybody else does as sort of like

the kind of the natural kind of progression, you know, hung around through the, you know, the bull market of 2017 and, you know, sort of come around the other side and okay, I think I, you know, done all my studying, you know, I've watched all my Andrés Antonopoulos

videos, I've been listening to Stefan Lavera podcast and, you know, all of that stuff and, you know, you're like, well, you know, I could continue to just sort of, you know, buy in total or I could sort of, you know, try to get involved and see what I can't, you know, be improved, you know, and I'm not a developer, right?

Just kind of a guy that, you know, just like most other people, you know, sort of stumbles on to Bitcoin, you know, when I sort of decided to start getting involved, I guess it was, I don't know, would have been 2019 or so, you know, coin join was becoming popular.

I think Wasabi Wallet had just sort of made it easy enough, right, with, with their implementation and that, you know, it was becoming kind of a real thing. So I was, you know, hanging around sort of the samurai wallet telegram and even the Wasabi wallet telegram at the time.

And you know, one room was significantly quieter than the other and, you know, the louder room tended to really talk about some stuff that I was like, oh man, I've never really heard about this and, and what that kind of was was sort of this crypto anarchy kind of ethos,

you know, sort of this, like, you know, absolute kind of voluntary, voluntary is sort of ethos where you sort of use the technology to opt out as much as you can. And they would share some links back and forth.

Some of it was guys like Smuggler, if you've heard of Smuggler and they always talked about stuff that was sort of, you know, wrong with Bitcoin, at least in their opinion, right? The privacy issues with Bitcoin were kind of a real, real thing.

And I said, you know, if this is a real thing, I should probably get it figured out for myself. And, you know, that sort of chipped off the whole kind of rabbit hole. Yeah, it's, I think probably the most interesting rabbit hole to go down because like you said, you sort of get in, you start learning about the economic side.

You get to a point where you're like, yeah, I mean, there's no question. This is the best money. You can listen for another thousand hours of people talking about it, people discussing where the price could go and all of that stuff.

And I did it for a long time as well. And then you just get to a point where you think, well, not really learning anything more here. Like, I'm pretty solid in my views that this is the best money.

But now when you realize, well, actually that the privacy is a real issue and a lot of people like to dance around it and say, oh, well, we'll fix it later and it doesn't really matter. But it does.

And it matters for the reasons you're talking about, like, if we're going to have a revolution, if we're going to have the ability to do what we want and say, fuck you, to the systems that are basically designed to hold people back and cause issues, then we need to have private money.

And that's what really excites me about the ability to do things with like samurai because I'm certainly not a developer, I'm very, very technically disabled or inept, or I don't know what the word would be, but I can still use samurai and it improves my privacy so much more than I would without it.

So I love having these sort of tools and trying to learn how to use them, basically. Yeah. I mean, it's a lot of people, I think, do exactly what you and I kind of have both done, right? Which is, yeah, I've sort of reached the limit, I can continue to buy in total or if I want

to get involved, that's kind of the next kind of logical step. And for me, it was just like you, I'm not a developer, but it's, where is there sort of a perceived problem? How can I maybe help or get involved or do whatever I can to improve people's usage?

Because like you said, if this is going to become a real thing, and in my opinion, the real thing is that the real power of Bitcoin is it allows people to voluntarily and peacefully interact with each other.

And if the privacy is an issue, then that becomes much more difficult. And so one of the big kind of, I guess, we'll just call it talking points is the transparency of kind of the Bitcoin blockchain.

I mean, anybody can pull up a web-based block explorer, plop in their address or transaction ID and see the movement of coins on chain. And that might not necessarily be tied directly to someone's identity or an identified address

or an identified actor, and that sort of gets to Bitcoin's suitanimity, right? Bitcoin is pseudonymous. It's not anonymous. And when we use those two kind of distinct terms, pseudanimity, it's not Max's address.

It doesn't say Max's full name, last name, and his address and where he lives isn't what's on the blockchain, it's a jumbled up characters and an address. So that address is kind of your one time use pseudonym.

And the way Bitcoin works, we can see the flows into and out of that address, basically. And to transition, I kind of call Bitcoin's pseudanimity powerful, but fragile. It works and it can be used relatively privately.

But it takes a good bit of additional effort, basically. So again, I call it powerful, but fragile. Linking your identity to your transactions is awful, interacting with exchanges, which are known entities and typically easily identified on chain is also pretty damaging.

So that kind of what is where I started, and then I dove into OXT and KYCP and some of these other tools. That's sort of the samurai team work around. For you to get to this level where you're doing the things you're doing, like I'm looking at OXT, unwinding of coin joins and being able to track things in the way you are, how

did you get to that point? Obviously, you're saying you had this switchover where you're like, "No, I want to do something that's actually sort of actionable, something that is useful, and you decided to go down this route."

How did you start? Did you already have some skills in this kind of thing from other work, or was it just completely fresh? No, it was completely fresh. And what I was trying to do at the time was decide, "Okay, there are these two chow main style coin join implementations."

Or at the time, I think it was just wasabi and samurai was just getting ready to have their beta testing for Whirlpool. And I was like, "Well, which one am I going to use?" It was being talked about at the time.

This is a thing. Now you can do this. It's easier than join market made it at the time. I was kind of like you, not very technically savvy, "Okay, I want to use this to hopefully improve my privacy, and which implementation would I choose?"

And that sort of required me to basically develop the skills from the ground up. And what I mean by that is I didn't take the time to build the blockchain analytics tools. So a lot of the credit for this, what I'm able to do really needs to go to Laurent, the OXT developer.

He created OXT several years ago. It's kind of a very basic blockchain analysis platform. It will do some simple things like clustering, and it has a transaction graph, and does a couple other things like address or use and calculate kind of coin join properties.

And so I started off by comparing kind of wasabi and whirlpool. And in the process of that, I basically stumbled on a multi-billion dollar Ponzi scheme as it sort of forced its way through wasabi coin joins.

And from there, that sort of just led me down kind of a whole nother rabbit hole of really kind of going from, "Okay, let's just compare these two things to, well, what does it really take to kind of do more active tracking?"

So yeah, I mean, that's kind of the short version of how I got to where kind of on that now. And is it something that you just got more and more interested as you were going down? She's saying you stumbled across this, and then you dig in further and further, and like,

is it something that as you learn more and you can understand more of what's gone on in the past? Because it feels to me it's almost like a Sherlock Holmes mystery and you're sort of finding these clues and making assumptions and working things out that just completely goes over my head.

Is it a fun process is basically what I'm getting at to actually do this? Yeah, I mean, I enjoy problem solving. I enjoy learning about technical stuff to the best of my abilities and sort of getting involved and getting kind of my hands dirty and understanding kind of the mechanisms and how things work.

And it's just kind of the way I am. And I think a lot of people are sort of like that. And so like you said, like I mentioned, it just sort of kind of became one thing after another, just sort of stepping further and further down kind of the rabbit hole.

And just like you mentioned, that sort of mystery aspect, what am I going to find here is one of the things that I find fun, right? And that sort of keeps me doing it. And I don't always find anything relevant, right?

There are times when people send me something, hey, could you look at this and I'll spend you know, 20 minutes and I'm like, hey, you know, there's nothing here. And that's what I mean by still kind of how powerful Bitcoin's pseudonymity can be.

But yeah, yeah, I do enjoy it. And what's the craziest thing that you've come across, like, if you had to pick one thing and just be like, that I wasn't expecting or that has blown my mind, what would you pick out as your number one?

It was probably really plus token, you know, the multi-billion dollar Ponzi scheme. And I sort of stumbled on it accidentally. There was, you know, an issue that sort of the samurai guys were talking about with the Wasabi coin join implementation.

And you know, that was their address reuse problem. And for those that don't know, address reuse is awful for privacy. We don't, a lot of blockchain analysis assumptions are based on heuristics.

And heuristics are sort of general rules of thumb that work most of the time, you know, when the heuristic is wrong, it's wrong. But address use isn't really a heuristic. It's, you know, we know that an entity controls this address.

And if it receives, you know, multiple, you know, UTXOs, we know that's still the same entity that controls those kind of coins. And so when I kind of stumbled on, you know, the address use problem with Wasabi, you know, it sort of just led to kind of this whole big debacle, which was, you know, a multi-billion

dollar Ponzi scheme called plus token, a Chinese Ponzi scheme, they just about always seemed to be Eastern Ponzi schemes. And from there, I kind of went into, you know, tracking mode. It kind of became not just about, okay, what, you know, what are the flaws in this implementation

and what's really going on, kind of at sort of like the minutia blockchain level, it kind of became, hey, there's a lot of coins here. And they had something like 200,000 coins by my estimate.

And so, you know, the next thing became, well, all these coins are being transferred to an exchange, right? When coins get transferred to an exchange, you know, not your keys, not your coins, you sort of go to the assumption that things are being sold, you know, these coins are being distributed on the market.

And, you know, so I went from kind of blockchain snooping specifically to, okay, broader picture, you know, how many coins do they have left? How long is it going to take them to kind of keep selling?

So to me, that was a lot of fun. That was kind of a full progression from minutia of blockchain analysis to what's wrong with wasabi to, you know, kind of this economic aspect, right? So it was kind of a full picture thing.

That's why, that's why I enjoy that the most. Yeah, it's a fascinating story. And like you said, there's so many of these scams and so many, so many just people fucking around. And what amazes me is like, they've stolen so much money, probably of people who really can't afford to lose that money.

You know, you hear about these scams and people checking their life savings in, and it's like it's really, really sad. And yeah, okay, they should have done their research. It is, it is really sad to see.

So have any of these trackings actually ever got people's Bitcoin back or like found the people who are behind it or managed to actually lift the mask at all? From our work specifically, not yet, you know, we can get to that, you know, what we're sort of, Oh, Xt is sort of doing now.

But you know, for those that also don't know, I mean, there's, there are several surveillance firms that, you know, are actively contracted by governments and investigators and, you know, law enforcement to do this type of tracking.

And you know, they're becoming kind of monopolies and sort of their own right. And they're sort of transitioning from, well, you know, we run compliance tools, you know, to, well, we sort of do this tracking on an individual sort of law enforcement kind of

basis, right, where, okay, we identified so and so and, you know, then the Treasury Department then issues or the Department of Justice then issue sanctions on, you know, such and such entity.

That, that's happened in the past, right? And that sort of kind of was sort of a lot of groundwork was actually laid in 2020 where the surveillance firms were introducing these terms and, you know, kind of prepping regulators for kind of the next step, which is, you know, this kind of compliance stage that they're at now.

But so, so us at OXT, we, we have just sort of started doing what we like to call kind of defensive chain analysis. And what we mean by that is, I think probably your listeners are familiar with the ledger hack and the disclosure of all those people's personal information and the phishing campaign

that followed and kind of how many people lost their coins, right? And so we've had several people reach out to us over the last, you know, kind of year or so saying, hey, you know, such and such thing happened.

Can you kind of help me? I'm looking to get kind of a formal investigation done and hire a private investigator and kind of go there, their route of trying to get their coins back. And we've recently just started doing some of this, this work.

So, you know, we have, we personally, you know, as far as I know, haven't, haven't heard back on some of these cases that we've, you know, started working on. But yeah, I mean, law enforcement, you know, does get involved.

The chain surveillance firms do get involved. They do actively do these types of investigations. And we're looking to do this sort of more for, you know, a defensive and kind of recovery perspective.

There are firms that also do that, private firms that aren't really kind of as cringy as kind of the chain analysis firms. But it does happen. Yeah. And so with this knowledge and being able to track and see, you're talking about you sort of have these heuristics and you're looking at probabilities, basically, then that arms

you quite well to see will actually what is the best way to keep some privacy on chain and actually how to avoid these chain surveillance companies from actually spying on people. And presumably you know quite well how to fuck them up.

So it'd be interesting for me to know what is in your eyes, like the best flow for like a normal user, what is the best flow? Is it just obviously trying by no KYC, then whack it through whirlpool, leave it there for as long as you can, and then send to a new address or leave it in there and only

spend from there, like what's a flow that's reasonable for people where it would give someone like you problems? Yeah. So one of the big issues, at least kind of in my opinion with how I sort of see the topology of the blockchain is just about everybody is one or two hops from a KYC exchange, right?

You know you buy your coins on Coinbase and pull them out to your own address and well there they are. So obviously you mentioned step one is try to avoid KYC as much as you can. To me in my mind one of the best ways to do that is to go hit up one of your local ATMs and from there you're going to be doing that sort of cash transaction.

The coins are going to go straight into your samurai wallet, right? And from there as you sort of build up enough of a balance you can enter the whirlpool, right? And from there you know the trail is very difficult to follow.

It depends on sort of kind of to where people are at. For some of us we just leave our coins mixing, other people are like you know I'm not really comfortable with this hot wallet thing, I'm going to pull my coins out and send them my hardware wallet.

And you know remixing is free, you know try to do two remixes or two total mixes at least if you can, you know try to just give yourself a little bit of extra time in the pool. And you know spend as you sort of build up a balance that makes you uncomfortable, right?

It's probably the way that I would suggest it, right? And that would be sort of sweeping individual UTXOs or doing stone walls to wherever you know you're sending the coins on later. And stone wall is for those that don't know.

Either a two party you know coin join that pays to it kind of a third party address or it could be even a single wallet stone wall. So you don't have to do that with anybody if you don't want, they have the same pattern on chain and then the chain analysis person like me then has to figure out if this stone wall is one wallet or two.

So you know we kind of go, we have significantly improved whatever kind of on chain privacy that you know you normally would have had you know going from just simply withdrawing from your exchange to your own wallet to now traversing Whirlpool and getting a nice post mix spend on the way out.

Yeah, so you can tell me if this is wrong but to me it seems like if you were to do what you've just said and when you go and you buy your no KYC coins at an ATM and you're wearing your hat and ballet and all that and then you put it through Whirlpool and you spend

from there as long as your spends on with like a retailer that has your personal information or anything like that it's to another fresh wallet. It shouldn't be that anyone can really know who you are or see what you're doing.

Is that fair to assume or is there some way that you can still do something, some witchcraft that I don't know about? Yeah, one of the things that will always be kind of a threat to Bitcoin privacy is kind of you know volume and timing analysis and when we say that we mean if someone dumps

a hundred Bitcoin into you know Whirlpool goes through a single mix and pulls out a hundred Bitcoin in one go that's fairly obvious and but that's not a problem that most people have right that's like a very specific issue and let's say that you still want to kind

of mitigate that right how would you do that okay so there's two parts of a volume and timing analysis right so step one is to not be doing a ridiculous volume right let's just call it something reasonable for whatever you know pool size that you've selected and

then the next would be timing and how do you break kind of timing analysis right and that's what I get into okay you leave your coins in for as long as you can and we have this kind of perception of of what time means to us as humans and then there sort of is what

time means on the blockchain and kind of what time means for sort of Whirlpool they're not quite the same right they're supposed to be a block every 10 minutes but the way Whirlpool sort of works is that it requires incoming liquidity to trigger a mix so you know people

say I left my coins in for a couple hours and I haven't gotten a remix yet well that's because you just finished your first mix and now you're kind of in queue to be randomly selected for your remixing so you know you know volume and timing can still be an issue

but there are certainly ways around that and Whirlpool incentivizes that kind of as much as possible you know by allowing you to basically remix for free for as long as you want you know as long as you're kind of comfortable and again a lot of this doesn't really apply

to kind of the smaller normal user you know another issue would be kind of this select all spend that people have a tendency to do and this is this is I think sort of just like a human nature problem you know people are used to having like all of their coins

or all of their money in some singular account and so what people one of the things that we notice is that one of the big issues is people will take all of their coins dump them through you know a coin join and then exit and send them all to the same address you

know and it's like why did you kind of do what you did if that wasn't going to be the case so that's that's kind of one of the other things that Stonewall benefits right is that it forces people to spend a little bit less than their overall balance and you're not

going to do it all in one transaction right so those are kind of maybe just a recap you know there's volume and timing that's an issue and that sort of select all bad post mix spending that people should just if you can avoid those kind of things you're going

to be okay you're going to be much better off right that's just from sort of you know the chain only kind of perspective and you asked about well what if I want to send it to someone right I've got to make like an actual payment at sort of like the most granular

level you're making a payment to someone and you're you're forced to disclose to them that you know you've made a payment that's just sort of is the way kind of Bitcoin works right it's I'm sending I'm sending to this address but if they look back at your history

they're not going to see your whole wallet balance if you've done a spend from Whirlpool they're going to run up you know basically to Whirlpool you know if they try to track your coins back through history and they're not going to know your whole transaction history

they're going to know that you sent them coins from Whirlpool and that's about as good as you can kind of get right yeah and I think a lot of people just don't seem to understand the importance of this like I'm very much with friends of mine who are now as the price

is running up they're starting to buy you know the people who talk to for years and they ignore you and they see it run and they want to buy it and it's very difficult to say to them well these are the reasons that you should be worrying about your privacy

and you know you do you really want someone to see your wallet balances do you really want them to have all this information and see what you've spent and who you've interacted with and I think they're just they're not used to it in the normal world like they don't

think about oh well when I spend money from my bank account that my boss or my employers or whoever else can see it yeah the bank can but they don't have that problem so how do you think is a good way to explain it is there is there a better way that I'm missing

to help make people see how important this is I think there's you know I was listening to your katana podcast you know just recently and you know you both kind of came to the conclusion hey you know I just don't really force you know preaching Bitcoin on to people

anymore and you know I think that the next kind of step for most people after they sort of get in is okay you know I've got this thing and I want to you know I've got it on my hardware wallet maybe at some point they start looking to spend right and you know hopefully they

sort of come across something like this and they they they realize that there you know is a problem here right which is you know kind of hard like you said you know the difference between sort of Bitcoin and kind of the traditional financial system is that Bitcoin is entirely

transparent you know we kind of get back to that I can plug any address into a you know a block explorer and track the coins the the previous history or the forward history that's me you know just any person right you know any any curious third party can can do that

and it's not quite the same as kind of the the traditional financial system where like you said the banks you know kind of act as a buffer for anyone else from knowing but you sort of mentioned kind of a you know one important part there which is you know let's say you

have a job and you're earning Bitcoin income you know on whatever basis because of the way Bitcoin works your boss pays you to an address right and then they can follow your spending habits sort of forward so maybe for a reasonable person it would be hey you know just so you

know this is how Bitcoin works right if I send you coins I can then follow right the future spending pattern of those coins and if you said something like hey would you be comfortable with your boss knowing all of your spending habits they might you know go

wait a minute you know this is something that I need to figure out right so I think that's a good way to to talk about it to people it's more relatable it's not kind of this highly technical sort of you know minutiae thing that we're kind of talking about now but but

you know so some of it I think too that you can do is is being in sort of an experienced Bitcoiner you know you can you know send coins to your friends and use that kind of as an example too right something that's sort of personal you know and say hey just so you know

I watched you do this or I saw you know this kind of spending habit so you know I kind of really really creepy with them you know I it's like I don't know of kind of a good way to do it it's like it sort of becomes kind of you know a fear and awakening kind

of thing like oh shit this is something that I need to kind of get figured out right but I think you've got your onto it there with sort of that boss analogy or otherwise kind of you know sending them some coins and explaining to them kind of the process it kind of comes

back to you know being you know there needs to be a little bit of hand holding for kind of your normie friends who you got into this there does and yeah I like like I was saying with Katana I don't really speak to people that much about it but I will the people who

are already involved and the people who are asking me the questions about price I'll try and sort of turn that on to the privacy side instead and they come around eventually and like I never thought about any of this stuff when I first got involved and I made so many

fucking stupid mistakes and like when I think back at the way that I entered the space I just want to slap myself I just think you idiot like you fuck with why have you done the things that you've done but you can't go back so you can only improve and try and

worry about what you do going forward and it just takes time it's just such a it's such a complex subject and there's so much going on and like I think the first thing is you're making sure that your investment isn't going to go to zero and all the fud you're hearing

is actually wrong and you're digging into that and then you have that sort of moment of okay no I'm pretty sure I'm right on this thing now what and I think only then it's really you sort of think about the privacy side yeah you know it's really important to

hold your own keys right if if we're gonna operate you know this sort of bear digital bear asset right then you need to take ownership right then there's the node side that you know kind of this the next step for a lot of people but like kind of in this sort of middle ground

right before people do that I mean I can't tell you how many times that it just seems like most people are pulling their coins out from their exchange account and sending them to you know one hop to basically the same address right they're reusing their address

they don't even know that they're making it completely obvious to you know kind of anyone that this is their entire balance right so you know there's a lot of things like you know if we can we can hammer on kind of the technical stuff but like there's probably

sort of a short list of things that people just if they don't do these things and they're relatively simple to do they'll be much better off right and so the one thing that people should absolutely avoid is address reuse right if you reuse an address then we no longer

have to make a heuristic assumption that you know this is own these separate addresses are owned by the same person because they are the same address another big issue is consolidating all of let's say let's say you're not reusing your addresses and you've got you know coins

and all of your sort of separate separate addresses one day you may get scared of the impending fee event and think that you are fragmented you know wallet needs to be consolidated into a single UTXO and a single address that's kind of another big no-no you know you can

keep your addresses separate hopefully you're using a wallet with coin control and so that would be kind of like the next thing so no address reuse don't consolidate all your coins with the same address and I'm trying to think if there's really any I mean there are a couple

others that we can talk about too but those are those are two really very simple things that like a newbie can hopefully you know sort of grasp right away right and it should be doing a lot of this stuff should be done in the background really like you know the

address reuse I don't know why people are doing that because everything that I use automatically gives me a new address anyway like I'm not it's not even an option for anything that I'm using so how why and how are people still doing this I don't know I think it sort of

comes back to this sort of human nature kind of problem you know people they don't quite understand what their how Bitcoin works and it's like you kind of have to take sort of a very high level understanding to go wait a minute you know I just plugged in my treasure

the address I use last time is now different you know why would I go back and select you know that address again but I think that that's still happening maybe maybe it's the way that the exchange accounts are set up right you know you put in a dedicated address

and the exchange always withdraws to that address unless you go back and then reset and put in a new one every time you go to withdrawal right so I think that that might also have you know a big part in this and so to kind of come you know maybe kind of take it sort

of full circle you know I called bitcoins privacy you know pseudonymity is powerful but fragile and when you know you're sort of interacting with these large entities large kyc exchanges they have you know sort of an order flow that set up to make things as easy as possible

right which includes putting in that sort of static withdrawal address that you now have to go in and reset every time you want to withdraw whereas if you're sort of using you know kind of Bitcoin peer to peer when you go to your ATM and you pull up your samurai

wallet it displays a new address for you and that would be the same thing if you decided to pay someone right using BTC pay server or sort of any other you know kind of reasonable wallet if you get out of that sort of exchange structure a lot of that sort of starts to

get handled by the software on its own yeah and so like a big pain point like you're going through there about the address reuse and all these kind of things like a massive one is just the very start is just like the acquiring of the coins like what people are doing it

seems is very rarely going to the ATMs or using BISK or using HODL HODL or any of that almost everyone seems to go straight to kyc services because it's like the easiest way to do things and then they're looking at the fees and like for example the ATMs sort of

local to me like between 10 and 15% markup and you can obviously argue okay well it's worth it and don't worry because if you're holding these long term it doesn't really matter but it's hard to explain that to someone who's coming in then like what do you mean

pay 15% more to buy these like why would I do that when I can get this much more when I buy and I just click this button like there are some great tools out there but I do find it's really hard to get people to use them for so many reasons like that like the extra

cost and also liquidity like a lot of the time certainly here BISK is very difficult to get the liquidity to be able to buy what you want to buy and quite often with HODL HODL as well what do you see from your side in terms of growth with these sort of networks and is there

anything that you've got your eye on that could make this more possible for people and to push more liquidity to these sort of markets outside of the exchanges? Yeah I think a lot of it sort of has to do with people's original mindset you know people coming in or looking

at it as sort of a pure investment right I need to get out of fiat and into BTC or you know the inflation monster will gobble me up you know or however they've been sold you know this is why you need bitcoin so that I think some of it is the way that it's introduced

to people right you know and that's that's not to say that you know there aren't issues with the financial system and there aren't reasons to sell your fiat for bitcoin right but I think a lot of that sort of that a lot of that sort of resistance can be handled

by the way that you explain it to people I I'm sort of like you I don't really talk to it to my normie friends about bitcoin they know that I'm sort of you know I know about it and if they ask I'll you know try to you know give them sort of my perspective and

in the last few months with the price rise I've had several people finally come back to me and start asking me about it and instead of pitching them the Austrian economics you know number go up kind of thing I just frame it somewhat differently and this is just me

you know not everybody's gonna want to do this but I frame it as kind of the peer-to-peer electronic cash kind of methodology where you know the real in my opinion the real power that bitcoin allows people is their voluntary peaceful interaction with someone else economically

and if you enter if you if you're trying to exit the involuntary permission system that we kind of have now right where you know you have to go KYC yourself for your bank account you have to the taxes are automatically taken out of your paycheck so many things that we

do right now are entirely permissioned that bitcoin and sort of your voluntary interaction with bitcoin can sort of be one of the only outlets where you you get to interact with something permissionlessly and if you can sort of take this yeah you know I really just want

to get some you know I'm worried about these fees and you sort of kind of turn it on its head and say you know the goal isn't to get as much of this as you can the goal is to you know peacefully exit the system as best you can the hurdles become a little bit more

maybe palatable right that doesn't make that doesn't make them you know easier necessarily but it's sort of you know frames things for people and like hey you know this is where I'm at with my sort of bitcoin journey you know can I shortcut that process for other

people right and that's sort of that's sort of how I look at things now do you view it as that do you view bitcoin as a necessary escape hatch do you think that this is something that most people are going to need in the coming months and years obviously there are

some people who need it right now as well but like what's your view on this do you think that this is we're going to basically become necessary for most people as we see the fuckery continue in the traditional financial systems and with everything that's going on with the

governments around the world at the moment yeah I mean if you I usually try to tune out from the news and sort of social media kind of as much as possible but you know there are sort of new emergent narratives about how the people in power are instead of turning

on you know an external entity and framing them as the enemy they're sort of now framing their own people as the enemy you know domestic terror the 6th January event and at the capital and you know the United States these things they're very sort of you know similar to sort

of what happened after 9/11 except 9/11 you know things were pointed at least supposedly outward but now it's kind of coming back and being pointed inward right we've got sort of COVID as sort of the underlying smokescreen for a lot of this kind of awfulness and you

know so so people are and this isn't going to be the the broad everyone but some people you know have had their bank accounts frozen they've had you know some real sort of financial problems imposed on them for not behaving in a way that such and such platform you know

thinks people should be behaving wrong thing and so right exactly wrong thing right and that's that's extremely dangerous to you know basically kind of free society as we know it so you know what what will people do kind of in the coming years maybe you know they're

just always gonna be the people that don't see the problem that's hurtling towards them and they're gonna be the people that are or have you know received or been on the short end of the overreaching state or the overreaching you know oligopoly of whatever company and

those people are going to have to find those people are still going to want to interact voluntarily you know with with others economically right and peacefully and you know for them bitcoin and you know frankly any other shit coin you know is is an alternative and they're

going to they're going to explore those alternatives right and it's only going to be sort of quick and the more the way I see is the more the more heavy handed the state is the more people that they're going to push to bitcoin right and that doesn't mean it's going to be most

people or all people right and they're not going to be on the bitcoin standard in two years from now but you know I see people fleeing kind of the permission system and entering the permissionless system right and that's why you know you sort of come back to well

10 to 15 percent how can I sort of get people kind of into thinking this way if you frame it you know as permissionless peer-to-peer electronic cash rather than an investment scheme and I think that's really relatively palatable right yeah I think definitely it

is and I was wondering as well do you find it difficult to sort of view things through two different lenses at one time and what I mean by that is what you're describing and what's going on in the world I'll quite often sort of view things through two lenses which

is I think fuck everything that's going on right now in the world is so bullish for bitcoin like it's just is the best marketing campaign for bitcoin I've ever seen and I couldn't make one better with everything that's going on certainly here and then the other side

of me is like yeah but it's really really scary the propaganda that's going up everywhere all the posters everywhere everything that's going on like I really genuinely feel like I'm living in 1984 or getting close to it do you find that a struggle where you are as

well to I imagine sort of have to think about it in two different ways and part of its worry and part of its maybe excitement yeah I think a lot of people like us are sort of there you know they're sort of in the same mentality it's been happening to me more recently a lot

of the normal people that I talked to are sort of you know I don't want to call it woke you know they're sort of noticing things aren't things aren't quite as they used to be I just sense it an underlying sort of tone change you know and then you kind of come back to

well okay well what does this mean sort of for bitcoin I mean I let me ask let me ask you this I mean bitcoin bitcoin is sort of requires a lot of responsibility that many people just you know they're not they're not willing to take you know until they absolutely

need to and one of the things that I always sort of come back to is like you know maybe a litmus test for whether or not people are are ready for bitcoin is do they use a fucking password manager I mean I can't tell you how many people are you know reusing the same

passwords across whatever you know security thing you know their bank account password is the same as their email password and they've been reusing the same password for the last I don't know you know ten years or something like that you know those those people are

going to be hard to get into bitcoin so I kind of think of that you know when I'm sort of talking to my normie friends and seeing sort of where they're at you know hey man you remember that time that I sent you some some coin a long time ago and you know he

pulls out his wallet and he he doesn't remember his pin and he doesn't know where he wrote down a seed phrase well you know tough shit man I you know you got to get yourself sorted you know here's what you need to do and and hear the steps that you need to take you know

talk to me when you're ready I just I just yeah I see I see the over you know the over line or the societal struggles that were you know we're going through now as something that pushes people towards bitcoin but I also see where most people are at and just sort

of how they handle their own personal responsibility and there's a big divide between those two those two things some people will converge some people won't you know yeah I think a lot of that comes down to people have sort of been domesticated a lot of them a lot of

the way people are taught in schools and universities and in their jobs they have to have less and less responsibility and talking about oh you know people using the same pin number or the same password well a lot of people will just say oh well you know the bank will

bail me out oh well my credit card covers that my insurance covers that so they don't have to be accountable for their stupidity and so they're just not used to it whereas the people that I found generally that I'm speaking to within bitcoin haven't always

had such a normal life or they've had to live life a little bit outside of the system or they've had some hardships where they've had to actually take on the responsibility for themselves and they are ready they're already prepped for this they're like yeah well I've

been looking after myself forever so what's the fucking difference I think that the people who have had it very very easy will find it hardest to make that switch yeah yeah I think you're right you know and you know how do you you know like how do you how do you sort

of assess where the person is at that you're sort of talking to right I know you're you know you're sort of asking and kind of the broadest sense you know what does this you know what does all this do for bitcoin in general and I don't really like to you know worry

about that or think like that because so much of that is just sort of outside of your control because it depends on where that person is is kind of at themselves but you know it really comes back to like talking to people and understanding where they're at you know and not being not

shoving this sort of ideology down somebody's throat you know trying to meet them halfway I meet them where they're at and sort of you know assessing on a case by case basis and I you know the more that you do that probably the better off you know the people that you

teach about bitcoin will be right yeah I think so and the other thing that I'm kind of I don't know about whether I'd say I'm worried about it but I'm the other reason I'm sort of pulling back from speaking to normal people about any of this stuff is I have a strong

feeling that we're going to become the villains you were talking earlier about you know domestic terrorists and how things are being turned on you know it's internal and they're like dividing people into groups of left and right and you know all these different little groups

that people have been divided into and people are starting to attack each other and grasp on each other and the behavior that I'm seeing in the UK is so fucking pathetic it really is sad and I have this feeling that we are going to be targeted as either destroying the

planet or you know some it would be some bullshit to turn people against the idea of this and what really makes me think that that's going to happen is the propaganda that we've got going out all over the UK at the moment is posters which will say things like they have

like an old man in hospital dying and then it will say tell him COVID-19 isn't dangerous tell the people who have died COVID-19 isn't dangerous and what it's basically saying is and people have started to actually say this now so if I'll say well it's not as dangerous

as you think and lockdowns are fucking retarded shut up don't be thinking that it's reasonable to take people's businesses and freedoms away for this they will just come back with that they go oh tell that's the people who have died you're disgusting I know someone

who's died and I feel like that might happen with the financial system where it's going to collapse like things can't continue forever it's an absolute shit show do you think they're going to go oh well Bitcoin was the cause of that um I don't see Bitcoin being fingered

as the cause um kind of in the sense that you're sort of thinking but I mean you can sort of look back at kind of what's happened in history with um other currency collapses and and this is what this is probably where people need to you know okay I understand

there's some problems going on in the world um maybe it's better to you know disconnect from whatever thing that I'm seeing you know or I'm being spoon fed from you know whatever service or whatever state you know actor um and say you know what this not that this

isn't different you know from what's sort of happened in the past but there might be some you know framework that you can go to and say hey look in the past in this country that's had kind of a currency collapse what happened and what did what did the government

do there and the answer is very likely to play out similarly wherever you are um you know so reading a bit of history now is probably very useful to a lot of people and I think it's something that that has um you know the people don't do anymore you know um yeah you

might pick up an Australian economic you know economics book you know read a little bit of you know um Hayek you know something like that but you know some sort of real historical perspectives I think are very valuable now you can use them as sort of your own heuristics

for hey you know this is sort of what might happen here you know because it's what's happened in the past and it's how you know governments have acted in the past um and you can sort of think about that and use that to to you know position yourself um and like you could

pick Venezuela as an example you know their recent you know currency collapse and recent issues well you know what happens is that they frame this as a problem of the speculators you know the speculators are the problem and they're the reason that we are having whatever

problems and we're going to put in capital controls and the capital controls you know make things worse and you know eventually there's sort of is you know a light switch that goes off and everyone realizes what the hell is going on um you know and there's still

is sort of that gap between where most of the West is at now um and sort of where you know maybe you and I are and where some other Bitcoiners are but you can sort of use those things as heuristic for how they might play out um I don't see Bitcoiners you know this

round being you know targeted maybe in the future but um I still think that there are you know kind of undertones of of um potential um you know kind of issues for Bitcoin I don't want to call it you know pure targets right we've already got the creeping KYC kind of

issue right um you know we've got exchanges now requiring that people you know KYC their withdrawal address right that's another sort of step in the wrong direction um there are some mining pools that are making rumblings of hey you know we are no longer going to

mine transactions involving OFAC sanctioned addresses okay you know I'm not an OFAC sanctioned entity but you know we're sort of walking towards that kind of slowly kind of it you know with Bitcoin right um so you know people I think need to start getting ready start getting

prepared you know yeah it is definitely creeping and it's only gonna go one way like they're gonna continue to try and strangle it and and do whatever they can because it's what they always do are there any tools out there you know we talked quite a lot about samurai and

obviously rona dojo and these are the tools that you can use are there any other tools out there or things out there that are coming down the pipeline that are really exciting you and would would stop you from being creepy and and looking at my transactions and sort of knowing what's going

on um I don't think there's much at the protocol level that's coming that will significantly move the needle for privacy um I know people are excited about taproot and you know shnoor signatures and and how that will hide kind of the multi-signature address footprint you know that

will be a you know a bit of a benefit for lightning network that it'll sort of hide you know channel openings and closings which you know certainly is a benefit um and there's been a little bit of research that's been published recently about lightning network that sort of compounds the on

chain assumptions and heuristics and issues and you know sort of levers them onto the lightning network itself you know so that will certainly help you know something like confidential transactions would be absolutely wonderful to see on bitcoin but you know that's just not going to happen um

you know there might be some others smaller you know um changes like um I think it's called cross input signature aggregation which yeah I think it's just a fancy term for making transactions a bit cheaper that would help coin joins and you know the one other thing that I do like I think it's

called um stratum stratum v2 something like that that works for mining right exactly for mining that will sort of make mining a little bit more kind of decentralized and I'll have to dive into the technicals of that um but there are some you know some interesting things that some of the

mining pools are doing I think one of them Laurentia pool you know some of them they're uh they're not taking you know possession of the the bitcoin block rewards that they're that they're mining they're paying them basically straight to the users so that they never assume custody and then

they you know are more likely to be able to evade kind of financial sanctions so I think that's that's very promising and then sort of other than that you know you're looking at things at the um the application layer you know which kind of gets back to you know samurai wallet and you

know coin join and bit 47 and you know cahoots transactions and all these other things that really will benefit people's you know kind of privacy as much as as that stuff to me really moves the needle you know it doesn't do it by default which we would like to see at the protocol

you know level but it at least gives people the option to get significantly better privacy and yeah yeah and you know and then with that better privacy you know it sort of gets back to that yeah okay now we can sort of use bitcoin as as voluntarily you know economically as possible

right it's exciting like I'm like what gives me a lot of hope is that I'm able to use these tools okay maybe not that slick and I have to call up bitcoin q&a every now and then I'm gonna go fucking out mate what have I done now this isn't what you know it's not perfect but I can do it

which means anyone can do it and it's not that hard and just having those two like if you have a graphene phone for 150 quid and you you run a Ronan dojo for a couple hundred quid and you have have samurai you're pretty good like it seems if you do if you follow what you're talking about

and don't do anything stupid and don't you know don't you think about these timing analysis things and you know you know you're not a whale chucking in a thousand bitcoin or something like that then it seems like for a few hundred quid and not that much hardship you can have a massive

increase in your privacy and that's exciting to me because I can only see that getting better yeah yeah I mean I agree you know the the hundred dollars of the hundred and fifty dollars that you would have spent on you know kind of a hardware wallet you could just you know buy a halfway decent

android and just use that only as as a wallet right you put samurai on it and you get all of the additional samurai features and kind of functionality and optionality right that you don't get with the hardware wallet you know and I know some people are very scared of online wallets I mean you can

use samurai in offline mode there's all kinds you know you could get sentinel which is sort of the watch only wallet plug your ex-pub into that and you know it to me you know you getting a really good wallet is is sort of what people you know should do you know rather than sort of fussing about

a lot of this other stuff that in my opinion doesn't move the needle as much as as kind of I'd like to see for that sort of you know permissionlessness you know absolutely getting your coins off the exchange is is step one right and then from there if you're sort of looking to kind of use bitcoin

a little bit here and there you know maybe it's not for everything but let's say you want to buy something that you know you want a little bit of extra extra privacy for right let's I mean there there are for example VPNs are becoming much more popular right and there are a handful of VPNs

that accept you know bitcoin and you know like Monero and a couple other cryptocurrencies and like for a lot of people instead of using your credit card to buy your VPN that would be a really great you know kind of experiment or great kind of experience okay I'm going to spend some

of my bitcoin that I that I that I you know mind or that I bought with cash on the on the ATM I'm going to it's gone up enough now that I think I'm going to buy this VPN with bitcoin instead of using my credit card you know and that that's sort of where like that good wallet you know it gives you

the options to do things you know kind of much better you know I've literally just done that from my samurai for Mulvad which was which is brilliant worked perfectly and it just takes out that well you know doing on credit card just seems a little bit weird giving your information away

do you know what I mean like it just yeah you're doing it you're thinking this is dumb like this is there's got to be a better option and that is the better option so yeah yeah I agree with that and look I know you've got a hard stop and I know obviously I don't want you tracking my

transaction now creeped out with what Bitcoin Q&A has said so I won't keep you much longer but I just wanted to close out on what you were saying there about the hardware wallets and having samurai on a phone it's something that I'm I still struck like been completely honest I

love the samurai team and I love what they're doing but I have to be completely honest and say I don't feel comfortable to leave too much of a large amount sat remixing indefinitely and maybe that's probably just because I don't actually understand what's happening in the

background so I can't really see you know how safe this is but I've got this thing in my head of yeah you've got to use your hardware wallet how much of that in your opinion is reasonable and how much of it isn't because people spend a lot of money on hardware wallets and maybe it's not

as necessary as we're all thinking I don't know it'd be interesting to hear your thoughts um you know when I first got started um you know you you don't really have very many options there weren't really these you know wallets that you could put on your phone that you could just play

around with bitcoin with for um you know for free pop into the android store or the the apple store I mean there was a time when apple banned all bitcoin wallets right people forget about that um you know but like for sort of just getting started you know putting in 50 bucks and trying to you

know figure out if this is for you or not you know are you do you really need to spend 100 plus dollars on a hardware wallet you know in my opinion the answer is no you know you could certainly use a desktop wallet you could you could use a um a mobile wallet you know to just sort of get

started um and then you get into the okay I'm past my sort of trying this out phase you know I'm sort of into taking this a little bit more seriously you know I know that there's a risk to having your keys online and I'm not a security software expert who's going to say well you know if you

don't do you know you've got to worry about side channel attacks and you know secure modules and and and all of these you know kind of things um I mean if you sort of look at what it what it takes to extract a seed you know for most devices you know they they could get your seed which is why

you should be using a passphrase and if you're using a decent passphrase you know they would then need to have a key logger on whatever it is that you're using to get to your coins right and that sort of is kind of the flow right and that doesn't mean that you know a lot of that can be handled

sort of with practicing decent device hygiene I've got a dedicated device that you know I got Raspberry Pi with with my you know Ronan Dojo and it just wears away in the background okay that's that's signing for my transactions but you know it really only is used for Bitcoin and as long as

my home network is secured it's you know relatively okay um you know so some people you know they're gonna be uncomfortable and I think that that's a really good way to just to do it right is to put down the podcast I know that we're on a podcast put down the podcast turn off twitter and like

think for yourself is this a comfortable amount of money for me and the answer is potentially no and if that's the case then just move it to cold storage to some offline storage device you know taking whatever it is that you have that is potentially online and just taking it offline

is sort of like your 80/20 rule of security you know and that that should handle most people and placate you know most people it doesn't get into the side channel attacks and the secure modules and all this other stuff but you know I think that that's sort of a reasonable thing and you know

as your balance builds up in Whirlpool you just sort of spend from time to time and and exit to you know kind of your cold storage I think that's that's a super reasonable thing you know and to come kind of full circle do I need to spend 150 dollars or 200 dollars on you know the dongle

versus that only you know is a storage device or you know should I get a wallet with some decent functionality that could also function as kind of a storage device you know I think you better off spending the money on on that um that's just me you know and some people will never really be

there and that's okay you know that's just how I like to do things um you know and like you said you know I'm just not comfortable having all these these coins online then just as your balance builds up spend to your you know your cold storage however you have that set up right it's not it's

not too complicated yeah I think that's good advice and you know I what what is a lot to me is probably not a lot to other people but um the little bit that I do have after the ledger fishing scam I mean obviously we've been we've been talking in the background about this for some time like I

really hope you guys can help track my coins but um as I build my balance back up after that tragic last I will I would definitely take all that on board so thank you very much for uh teaching me well I didn't know that happened to you Max and I'm sorry sorry to hear that it's tragic

um absolutely tragic you know and and that that you know I don't want to open up an old wound but you know that kind of sort of comes back to one of the things that I you know worry about with the hardware wallets is that a lot of people fall for that right they're sort of told this is

secure device and the device is is better than their dirty laptop but at the end of the day they open up a fishing link they put in their seed or something right something bad happens and their coins are gone you know and that that something is is you know can that be handled at sort of the

hardware wallet level yeah you know depending on how you you know have your wallet configured you know you're not using their sort of web portal you know for your wallet you know you can handle some of that um you know but it sort of comes back to like basics you know do not click this link you know

this is a fishing email um and and it's gonna be it's hard for a lot of people you know it really is that that just aren't you know super savvy you know um but I think that a lot of people would would also benefit from you know spending some time on just improving their sort of technology in

general and bitcoin is definitely a gateway to that you know sometimes you have to get burned to sort of you know learn you know I've lost coins in the past trying to do ridiculous um you know uh hardware schemes and you know sort of is you know it sucks but you know you get better and that's

all you can always do it right yeah that's all we try and do and learn from our mistakes and yeah we all do stupid things and I regret my decisions and it happens but it's about moving forward so yeah thanks for the advice and um thank you very much for coming on the show and for everything

you do it's very much appreciated and it would be great to have you on again in the future and see what you're doing and what you're tracking but is there anything else that we haven't covered anything that you wanted to go through that we haven't no no I mean you could check me out

most of the work that I do is on research dot oxt dot me um all of our reports are there um anything that is new that gets published might be pay walled temporarily but you know we usually put it free after a few weeks or a month or something like that so all of our work is there um some

of it's a bit technical you know I've recently done a Q&A sort of style walkthrough of one of the recent reports I think that's on YouTube or it's possibly on the samurai wallet website if not you know ping me and I can I can send you that and other than that you know I'm on twitter I'm on

telegram I'm in the telegram chats mostly I much prefer telegram to twitter these days you know so if if something comes up you know anybody you know I lost my coins you know ping me and I'll see what I can do um I can't make any promises but you know we'll we'll we'll we'll take a look at it for you

thank you mate that's been great it's really good to chat to you and if you can send me a link of those things I'll put them in the show notes just so people can check out on youtube yeah definitely definitely cool all right mate take care thanks very much thanks max really enjoyed it