Own, control and understand bitcoin with sparrow wallet - Craig Raw

Bitcoin is close to becoming worthless.

Let's go!

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 episode is with Craig Raw. He is the team behind Sparrow. It was great to catch up with him again. He's been on the show a couple of times, so if you've missed those, you can go back and check them out.

Obviously, we talked about Sparrow, but we also got into some other topics. And yeah, this guy's just an absolute beast. He's one of my favorite Bitcoiners, just keeps his head down, keeps working, and just puts out incredible software.

To everyone who's been screaming sats and sending boosts, I want to say a big thank you. These are a few from the last episode. The episode was Samurai Wallet. 21,000 sats. Great episode, homeboy.

That's from John. Eight Mythradir, 20,891 sats. Great episode looking forward to multi-party TX0, especially if it results in sharing the fee. Bond, boosted from my fountain custodial lightning wallet.

In all seriousness, a big fan and user of Samurai World Pool looking forward to updates soon, TM. Mr. Mr. 10,100 sats, Ditto. Bubba, even my old ass have jumped into the pool multiple times.

Good show. You see, even Bubba's doing it. If you haven't already jumped into the pool, you can do that with Samurai or with Sparrow. And me and Craig do talk about that today. There is one more boost that I'm gonna read out just 'cause it's borrowed and minor.

10,000 sats. Go fuck yourself bit by bit and Samurai. Love you both. Love you too, Balmana. We did have some more people sending some sats and thank you to all of you as well, but I won't keep everyone waiting too long.

Just a final thank you to the show sponsors. A huge thank you to Foundation devices who make my favorite hardware. If you haven't seen it already, sort your fucking life out. Go to foundation devices.com and check it out.

If you do decide to buy one of these, which let's face it, you will if you see one. Then you can use my code bit by bit. That will give you a discount. I will also let them know that I'm shilling them hard.

I've managed to get one working and use it constantly without issues. So I think that should tell you all you need to know. But if you are even more special than me, you can pay $100 and have Bitcoin Q and A hold your hand through the process.

If you have any questions at all, you can reach out and ask me. And if you have any technical questions, probably best not to just reach out to Q and A or the foundation devices team. Go to foundation devices.com and enjoy the show.

Bonjour. - Hello, Max. - You're coming through nice and clear. How are you doing? - Very well, thank you. - It's nice to have you back on. It's been trying to think how long it's been. It's been about a year, I think, 'cause we had you on for 21ism first, and then I had you on the bit by bit pod.

And a lot has changed in a year. You've been a busy boy, it seems. - Yeah, I mean, in the space that we're in, things always seem to change a lot. I can't even remember what the state of play was when we lost the spoke.

So yeah, it's be good to have a chat about everything that's happened since. - Yeah, well, you've made my life really easy, 'cause you've just put a tweet out with Sparrow v1.7.2 and all the things that are included in that release.

I guess that's probably quite a good place to start and maybe go through some of those things. A lot is going on, like one of the big things that has changed for me is I've actually started using Sparrow.

So I kept waiting 'cause I was moving house and that fell through and I was like, oh, when I've moved, I'm gonna redo my whole setup and move across to Sparrow and do some other bits and pieces, but I wanted to do it all at the same time.

And so yeah, I've been running it now for about a month or something like that. And I've been really, really impressed so far, just like the usability of it has been incredible, importing different wallets and using felt crumb on the back end has been mind blowing really fast.

But yeah, I've been really, really impressed. It's one of those things I've been talking about for a long time, but it's different when you start running it. So the release, what I was gonna ask you about first was the passphrases.

You'd put out every different passphrase generates a valid wallet. I assume that when that happens in any wallet, are you saying there basically that it's indistinguishable for an attacker if they're over your shoulder?

Is that kind of the idea here and that maybe you could make multiple wallets and maybe have like dummy wallets? So there's layers to it. Is that kind of what you're getting out of there? - Well, you know, the BIP 39 passphrase is a system defined obviously in that where you have your bunch of seed words which everyone knows well.

And then in addition, you have this extra phrase which some people call your 25th word. It's sort of an extra piece of entropy that you add onto the end. Now, that is, you know, in order to follow in the sort of the idea of a system of something that you have plus something that you know.

And something that you have is your seed words which are stored in your wallet. And something that you know is the passphrase which is not stored in the wallet, right? So you need to remember the passphrase yourself.

And it is an optional feature. And I consider it an advanced feature because anybody knows trying to remember a pass word which is not the same as a passphrase and I'll go into why in a second.

But anybody who understands that you have to remember this thing in order to get access to your wallet will understand that we humans do forget things. And as a result, you can lose access.

So the passphrase as I say, is an advanced feature. Now, the thing that makes it different from a pass word is that every single passphrase, every possible, you know, set of letters and numbers creates a valid wallet because it's all just used as additional random bits to create your seed.

And that means that if you forget your passphrase, you can't just keep on trying until the application eventually says, you know, you've got it right, much like your password. It'll just keep on creating new wallets for you and you'll have to then go and consult the blockchain.

And that's, you know, for many people, not an expected thing. They're sort of expected to work like a pass word and it just doesn't work that way. It's not intended to. So trying to remember the passphrase is an issue and has been a sort of issue and tends to make people quite frustrated when they're expected

to work like a pass word and they enter in the wrong thing. They put a typo in and then they get a wallet that comes out and then they send funds to it. And of course, those funds have now gone to a different address.

So then they have to remember not only their original passphrase, but they also have to remember the one with the typo in order to get those funds out. So, you know, it creates the sort of friction which is not ideal.

And what this most recent release does is it just introduces this visual aid to help people remember what their passphrase phrase is. - And the visual aid is this master fingerprint. - That's correct.

So basically every seed has what we call a master fingerprint. It doesn't change. So every, if you have your seed words plus your passphrase, that will then be used to create a master fingerprint which is a relatively safe thing.

You know, you don't have to be too careful with it. But then we take that master fingerprint which has a few letters and numbers and we use that to create an image. And that's really because some people are more visual than they are, you know, they might not remember this arbitrary set of letters and numbers.

It kind of just looks a little bit weak to them. But a visual images for many people are much more accurate thing. And the way that these visual images work, it's a unique algorithm. Well, it's an algorithm that creates a unique image for every single input.

So even if you change it by one bit, it will be a completely different image. It will have different colors and a different shape. And that allows people to see as they enter their passphrase, they'll see that image change.

And then they'll be able to say, okay, it now looks like it's sort of red with this kind of blue bit in the middle. It looks like I've entered the right passphrase. And that's how that works.

- That's really interesting. I have to say I missed that. So that's the little bit where I'm looking here next to the master fingerprint on the right-hand side in the image. You have a little green box with sort of yellow dots.

You're saying that each time you add another letter or number, that is gonna change. I think that's gonna make a big difference for people. And also, yeah, the memory of a master fingerprint.

I just write mine down so that I can double check it on hardware wallets and stuff like that. What I was wondering, you'd said about, you kind of consider a passphrase as an advanced feature.

And I was wondering your opinion on, if I'm onboarding people, I'll always tell them to use a passphrase just because I don't necessarily always trust the hardware they're using or whatever.

I just feel a bit more comfortable with that. But I do always tell them to write down and keep at least one copy in case they were to forget it. Do you think that's maybe, in your opinion, a bad idea?

Do you have any thoughts around that? - Look, it's a tricky one because I do understand and see the value of the passphrase. And I think many people who are putting all their funds into a hot wallet, there is value to it.

But I also see the other side of people forgetting their passphrase or putting in typos and we are human. So I'm very much torn on it, to be honest. I like to say it's an advanced feature because I think that it's important for people to take it seriously and not just enter it in because it's a field that they feel they need to fill.

You need to pause. And Sparrow actually, when you create your wallet makes you reenter the passphrase. And every time you see that passphrase dialogue, there's a warning there. Just to try and get people to pay a bit of attention.

And I guess this visual cue, this life hash, is again, just trying to get people to pay attention when they do it. Because I think that it's all too easy to just enter it in and then kind of say, oh, I have used it before or, you know, I know what it is and then in a month's time you come back and then you just don't know.

I think we all overestimate how we're gonna remember things and are often surprised at how often these things just slipped from our minds but we don't use them for a while. - It makes sense.

I guess I kind of see it like, when I'm onboarding new people, especially, I'm thinking, well, I don't personally feel comfortable recommending multi-sig to them. And I don't want full reliance on the entropy given from a hardware wallet or from any other wallet.

So I'm always thinking, well, it's just sort of belt and braces. And if they're gonna keep a copy anyway and write it down, I feel like, okay, it's not multi-sig but it's just that extra layer of comfort.

So I can see both sides. - Yeah, I mean, I personally think the risk of, if you use a decent, well-known hardware wallet, the chances of losing your coins through entropy theft, kind of the wallet chooses some seed that it knows, I think that the likelihood of that is very low.

I mean, if you're gonna, if you, as long as you've taken reasonable precautions when you bought it, you bought it from the source, not from some random store, but you've, I think that at times Bitcoin has tend to go a little bit overboard on that particular worry.

I'm not saying that it isn't a risk. I'm just saying it's a pretty low risk in my view. So, I think that using a passphrase is a valid way to circumvent that. But if you're using a hard hardware wallet, it might not be necessary unless you're really quite paranoid.

And as long as you've obtained your hard hardware wallet from the good source, yeah, that's reasonable. So there's been a lot of other updates. The other thing I wanted to touch on is this wallet labeling, which is really excited me.

It's something really, really good to see. I think it's gonna help a huge amount of people. I wondered if we could just touch on that process, what it's been like to get to where you are now, getting a bit and getting people behind this and what's more to go before this can be implemented.

- Yeah, so it's been something that I've been wanting to do for a long time. If we look at why have a standard for wallet labels, if you were looking as you indeed just did, Max, to transfer your funds or your kind of working wallet from one wallet implementation to a different one, you can obviously take your seed words across,

you can obviously enter your passphrase. So, and if you have a hard hardware wallet, it's easy enough to connect that. But the one part that was really missing was being able to move your labels across.

And those are valuable things because they tell us the source of funds. And Bitcoin being the sort of UTXO model means that every UTXO as we spend it reveals information about where it came from.

It's sort of its source. You can see, for example, if you have a one Bitcoin UTXO and you spend it, then whoever you spend it to, will be able to see that you own that much, right? Which is giving away quite a lot of information.

So, it's helpful for us to be able to label things in order to determine what is their source. And we can kind of follow that in our own minds. And for a number of other reasons, which are quite practical.

So, really being able to, you know, not, or sorry, not being able to transfer your labels from one wallet to a different one was really quite a siloing effect. It just meant that people generally, once they kind of got working with one wallet, didn't really want to change.

Because, you know, they had all their labels set up there and they just couldn't move them. So, developing a standard to export and import labels was, you know, for me, an important thing.

Obviously, I could have just, you know, it's not a difficult thing to just write something that exports labels from a wallet. But to have a standard in place means that we can achieve what I just said to be able to, you know, export from one wallet implementation and import into a different one.

So, that was really the reason for going down that route. And it was a long journey. It began with posting to the Bitcoin dev mailing list and getting a bunch of feedback over my, sort of, original ideas, and then a process of kind of going through that, working on that, implementing much of it, also looking at the Bitcoin talk forum,

eventually getting after a few months to a point where I was ready to submit the bit, which is basically just a specification, and then waiting a further few months for that bit to be merged.

So, that was kind of the entire process. It took around six months for it to happen. - Okay, and what was the feedback? Was it all like, oh, that's reasonable, and that makes sense? Or was it a bit of a battle to get it done?

Because my assumption with all of these wallets is if there was no standard, people have their own way of doing things. And we all like to think our own way is the right way. Was it a bit of a battle?

Or were people like, okay, no, this is easy. Let's just go for it. - I wouldn't say it was a battle, but certainly, you know, when you get to something as basic as what is a format for putting in labels, which are not a complex thing, it's just a string of characters.

You certainly do get a lot of points of view. We have the concept and engineering terms of bike shedding, which is really just like, when it comes to designing the bike shed, everyone has a view on how the bike shed might be built.

Let's say we might only have one person who knows how to build the skyscraper, but everyone knows how to build the bike shed. So there was a bit of that, but I would say on the whole, I was glad for the feedback.

I think it's definitely made it into a better spec at the end of the day. And ultimately, you do need to get people to buy in. That is the point of it. Otherwise, you just go off and do your own thing.

So I think it's a worthwhile journey to go down, even if it is, you know, a difficult one, and it's so much easier just to build rather than write specs. I do think that there's a time in the place for it.

So do I want to do it again? Not really, but if it comes to it, then I will obviously have to. - Okay. Yeah, it's one of those things that I think maybe a lot of people would underestimate.

Labeling is kind of like one of the first things now that I suggest to people, if they're talking to me about privacy and people would be like, "Oh, shall I run Whirlpool and should I do this?"

And I should do that. I always say like, "Are you labeling things?" Like that's the first place to start because it's so easy to trip yourself up and it's such a powerful but simple thing to do.

And now with what you're doing, people don't get into the situation that I'm in now, which is I've labeled everything for years and I've made a lot of transactions and I've got a lot of different hardware wallets and a lot of different wallets because I've always tested and just playing around with stuff.

So now in a situation where I can't get any labels back, I can't move these labels and I'm fucked. I mean, hopefully at some point I'm gonna work out how to do it, but it's a real kick in the bollocks.

Whereas going forward with having a standard, then that shouldn't be an issue. You should be able to obviously go, okay, I can't get the wallet I was using before to work with these labels, but there is a standard so, okay, I'll move across to Sparrow and bang, they're there.

Even if you do it, if you've got thousands of transactions that are all labeled, you're gonna have to manually go through and write every single one and it's a pain in the ass if nothing else.

- Yeah, and I hope that whatever wallet you were using actually implements this bit so that you can get them out. That would be sort of the first prize here. So it's really up to the users to encourage the wallet devs to implement these sort of sort of things.

I think that they have a long list of things that they need to do all the time, but they will, if they're writing a good wallet, always listen to their users. And so it's really up to their users to ask for it.

So the particular bit there is bit 329. That's the one to ask for, if this interests you. - Yeah, well, so I actually spoke to, it was Spectre that I was using and to be completely fair to them, it's K9 Earth, one of the devs there.

He's been very, very helpful with me. He's given me a load of information and hopefully there's a work through and I'm pretty sure that he said they're going to implement it. Oh, that's the plan anyway, I'm pretty sure.

So it's currently causing me a load of drama, but he has been very helpful and is now just a case of a lot of the stuff that he's saying to do is just going over my head 'cause yeah, I don't know what the fuck I'm doing, but I'm hoping it gets sorted.

But yeah, it's just gonna be a huge improvement for people coming in and so you don't have that sort of situation and I would hope that there's more and more people who are gonna have this as a standard.

If it becomes a standard, presumably then it's still something that people can choose to do or not do. - Yeah, I mean, look, I don't think that there is a general purpose standard that competes with it.

There is one that the trades or guys built, but the way that it works requires the wallet seed, which obviously if you have a watch only wallet, you don't have the wallet seed. So you can't then export the labels because the specification literally requires that you have the wallet seed to create the export.

So apart from that, I'm not actually aware of any other wallet label export. So there shouldn't be a sort of a decision tree of which one am I going to implement. It should just be a case of, you know, am I going to allow my users to export the labels from their wallet and if so, this is the only standard that is there

that sort of is broad enough that can sort of cover all the use case cases. I think that it's a relatively easy thing to implement. It's really, you know, designed to be not burdensome. I kind of did it all in a day.

It wasn't, it didn't take me long. But I guess we'll just need to see which wallet's choose to do it. - Yeah, well, here's to how you think. The other thing, I think the first time I ever heard of Fulcrum was from you and then Q&A was banging on about it and saying how super fast it was and all this kind of stuff.

And I used it for the first time a couple of weeks ago and Jesus Christ is fast. I was trying to import some old wallets. I was trying to bring some old wallets online and it was taking, I think it was like three times, I tried to do it and it was taking like nearly a whole day and then not working.

That was on call and I kept doing it. I just kept having problems. Then I did it with Fulcrum and it took about 10 seconds. It was mind blowing. Can you talk to me a bit about why that's so fast?

And are there any downsides to using it? Because right now I'm like, I don't want to use anything else. - Yeah, so let me do the one downside first. The one downside of Fulcrum is right now, it doesn't like being, if you shut it down without in a non-graceful way.

If you just kind of have your little computer there and you pull the power out and it has to shut down, sort of there's no time for it to kind of stop itself, it can get into the state where the database that users gets corrupt.

So that's the one flaw that it has. I'm hoping that Fulcrum too repairs that and sort of so that that isn't the case anymore. But apart from that, they are no downsides. It's really a great piece of software.

The reason why I think it is as fast as it is is because number one, it's written in modern C++, which is about as fast a programming language, sort of a modern high level language as we have.

And I think it's written by somebody who is a self-described performance Nazi, which is quite like. So clearly somebody for whom they are just looking to find every performance angle that they can.

And I think it really shows. Now, if you are using other implementations, there are various reasons why they are slower. So the major one that is probably in use today is the Electrum Rust server that are known as Electress.

And that works in quite a different way, right? So the way that that works is that Electress stores the block that your transaction is in. But in order to retrieve the history for that block, it needs to actually go to Bitcoin Core and says, "Please give me this block."

It then downloads that entire block from Bitcoin Core, passes it, and then returns that information to the wallet. Now, if you can imagine, if you have 100 transactions, you've got 100 blocks.

And that then adds up in megabytes. If you've got 1,000, you have potentially gigabytes of traffic between Electress and Bitcoin Core. It needs to be transferred and paused in order for you to load your wallet.

And that's actually what the bottleneck is. It's kind of an architectural thing. So, Electra actress works well when the wallet size is small. Now, if you've got like 10 to 20 transactions, it really is not going to take very long to do that work.

But if you've got an old wallet that's starting to get kind of a few years old, you've got lots of transactions in it, that's at the point where that particular architecture starts to fall down.

And that's where Foc, Foc, Foc, Foc, Foc is different. So what it has is an ability to deliver all the data to the wallet without having to go back to Bitcoin Core. And that just makes it so much faster in terms of its ability to respond to different requests that the wallet might make.

- Yeah, so if you have like an old Samurai wallet and the mixed depth is massive on it and it's been there for years, then it's just going to be something you're going to want to use Foc room for.

- Yeah, that's right. That's kind of one of the major reasons that I started to push it forward is because lots of people were using the Whirlpool feature in Sparrow and they were starting to battle with their wallets not being able to load.

And for me, it was a clear point where I had to find some kind of answer. I even considered writing an electron server myself. But happily, I managed to come across Foc room and it just clearly solved the need.

It's just clearly a well-written piece of code that does what it needs to do. - Talking about Whirlpool, what's it been like implementing it and having that as an option being a client, is it in any way helping with the development process 'cause it's bringing in some fees?

Is it doing the things that you hoped it would do for the wallet and the users? - Yeah, I think that it's a big reason why people come to Sparrow. Many people seek privacy and certainly it has been a big draw card having that feature in there.

I think that also, just getting people to think about their privacy, lots of people hear about Whirlpool or at least CoinJoin. And they think, well, I need to understand that better and Sparrow is often the first port of call or the first time that they actually get to kind of experience it.

And I think it's a helpful way for people to kind of think about the Bitcoin UTXO model and how do I seek privacy with that model? Because it's not like the model is not like some that other wallets have kind of tried to create where you have a system which is trying to do its thing behind the scenes.

It's kind of its very front and center which is what Sparrow likes to promote. It's sort of the idea is that we want you, or at least I want you to be fully in control of your funds at all times.

I want you to know what's going on. I want to try and explain it to you on the way. So I think Whirlpool is great from that point of view. It kind of explains it as you're going through it.

You know, you can kind of see it. It is a multiple step process. So you can kind of see the flow of funds flowing through, but ultimately the transactions that it makes, you know, five in, five out, people can kind of grasp that and can see, okay, we've got five equal outputs.

Clearly, it's very difficult for anybody from the outside to tell which of those five is mine. And I think that kind of makes it a more graspable thing. So I think from the point of view of promoting privacy, it's been a really great feature to have and certainly being good working with the samurai guys on it, you know,

the client that exists within Sparrow is built by them. And, you know, it's being good to be able to just leverage that and to build the UI around it that you see today. - Hmm, it's funny or I always find it funny at least.

This view, the red team is mean and there's some of the nicest people I ever deal with. I just had samurai on about a week ago and they're just so fucking helpful and nice. It's very weird to me, some of the heat that goes their way.

And I know they don't care and it doesn't matter to them, but I do find it peculiar. And just the whole architecture, like he was talking me through bringing on different clients and obviously you're one of them.

Q&A has sort of potentially leaked that they might be bringing it to foundation which would mean then it's available potentially on iOS as well for iPhones. And to me, the fact that you just have this one pool that different clients can join just seems like such a smart way of doing it.

It just seems like the obvious way that you'd want to build this and that more people can join. You just have this one pool and it's better for everyone continuously. So they always, you know, and I look at what they're doing, I always think, okay, I feel a lot more confident now about privacy going forward for Bitcoin

as then I would without them being there. Yes, agreed, agreed. I think that, you know, they've added a huge amount to the space and done so often, you know, in the face of a lot of, you know, people trying to subvert their sort of efforts.

So, you know, for me, it's certainly, I think that they're right, good code. And I like the way that it works. I actually really like the fact that it takes time to perform remixes. Many people don't, they come onto the Sparrow Telegram group and they ask how long it takes and why it takes so long and all of these kind of things.

But actually, for me, that's a great feature. I think that lowering your time preference is always good. I think it's good to understand what you're doing and to understand how that remixing takes place over time with fresh liquidity coming in.

So you're not remixing with the same people over and over. You know, it's just for me a system that works well and is in line with the sort of Bitcoin ethos as I see it. And for that reason, I kind of, I never dismayed when people express worry or concern that it takes longer than they thought.

Because for me, that is actually a good thing. - Good things come to those who wait. Yeah, it's just nice that you have this one big pool of liquidity and the more clients that come on board the better and the other thing that was discussed is decentralizing the coordination process going forward, which all of it is very exciting.

The other thing that you had in your release is the tap signer and SaaS card support. It's not something I've played around with. Can you talk me through how that works and does someone need any extra hardware or?

- Sure, so I'll just go briefly into what those two products are first. So they're both made by Coincard, the same guys who make the cold card and what they are are smart cards. So the kind of smart card, every credit card is a smart card of some sort.

And the sort of NFC tap that we all have become quite used to these days. Well, it's basically, they are like hardware while it's built as smart, smart cards. So it's an interesting idea.

Now, I wanna say upfront that the downside to using a smart card over say something like a cold card is that you don't have a screen. And that means that you can't verify the address, for example, that you're trying to send to.

So it is definitely a security element which is taken away. And I think it's important to kind of state that upfront. However, it does come in at a lower price point. And if we look at the cost of the cold card, which is not an exorbitant cost, but certainly more than many people will be able to afford.

And we look at the cost of the tap signer, which is a comparable device. The tap sign signer costs much less and allows people to have a hardware wallet at a price point that I don't think any other hardware wallets can match.

I may be wrong on that, but I suspect that is the case. So, I think it just opens up an interesting avenue. So that's what the tap signer does. It's basically like a cold card with other screen.

So you can basically tap it and then you can use it to import a key store into the Sparrow and then sign and sign messages and all of those kind of things. Now the Sats card is a bit different.

It's if you've ever used an open dime before, it's basically a device on which you can load Sats and you can then hand that off to someone else. So it's quite handy, for example, if you wanted to give somebody who had no idea of how to use Bitcoin a gift and you just knew that you could just hand it to them and say, keep this safe.

One day you'll be able to spend the money that is on it. The previous device that Coinkite made was called an open dime, which is like a little USB thing. - Yeah, lots of open dimes. - The sort of smart card version, which is called the Sats card can actually be reused multiple times.

And if you know the open dime, it can only be used once. Plus, and I might be wrong here. It's coming at a really low price point of around $13, I think. So it's a really cheap device if you wanted to gift somebody or just be able to do a trade.

It's a relatively inexpensive device that allows you to use Bitcoin like you would cash. And so those are the two kind of products. One is a full hardware wallet and the other is sort of an open dime type thing where you can basically load on Sats and then sweep Sats off into a wallet at a later date.

In terms of using it with Sparrow, generally the computers that we use don't have any kind of card readers installed. So you need to usually buy an external one, which is a little USB device that you plug in and then you can then use those cards.

Now Coinkite do sell one of those on their store. So it's easy enough to buy one and then you'll be able to use those. Obviously, you can use it with your phone as well. That usually does have an NFC reader installed.

And I believe the Nunchuck mobile app is also a app that allows you to sort of interact with these. So there's a few ways to do it. - Yeah, it's definitely an interesting option to have it at that lower price point.

I just wonder how much these USB tap signer things are 'cause I looked on the Coinkite store and they're like, they're reduced at the moment, but still over $100. So I wonder, is there like a cheaper way for somebody to do that?

The way I've always viewed them is it's a useful thing if someone doesn't want to spend the money on a hardware wallet. But if you've got to buy one of these anyway, does that kind of negate the upside?

- Yeah, I think that that's a valid point. So there's two areas where it might be quite useful. The one is with multi-sake, right? So, what we know about multi-sake is that every additional key you have in multi-sake gives you like a whole nother level of security.

So if you are looking to put a multi-sake together, I suspect that if you wanted to do say a 203 and I might be wrong here, but I suspect that buying a few tap sign signers plus the card card reader actually ends up being cheaper.

Now, I'm not saying that that's what you should do because if the cost is much the same, it's probably better to do the cold cards 'cause then obviously you get the screens with each device.

But at some point it certainly starts to become worthwhile. Also, I think that often people are looking to get their kids into it, right? And to try and get their kids to understand how Bitcoin works and they kind of want to be able to introduce that, but buying a cold card if you have a few kids can get quite pricey.

So then I think the idea of using cards actually makes quite a lot of sense. They're kind of quite easy to use. You just put your card on the reader and then you can kind of interact with it.

It's got a little pin so you can kind of get used to that. It's not as complicated as a cold card. And for me, as I was building it, I just felt that that was a good kind of option, using the cards to kind of do that kind of thing.

I felt is a nice use case for them. Say they have a kid and they give them one of these Sats cards. They would go on to Sparrow and then what would happen? They would come up with a little prompt or pop up or something and they would just tap and then they're in.

- Yeah, so I would tend to think that the tap signer is probably the better card to go for for that particular use case. 'Cause it kind of allows you to have your own wallet. And I think that that's an important thing to sort of learn to kind of get that sort of early intro.

I think the Sats card, you could certainly use that as well. But then it's more of a, I think it's quite an accurate way to think about it is just like a piggy bank and you put money in and you put money in and eventually you take the hammer and you smash, smash, smash it, right?

That's kind of how it works. The advantages that you actually get 10 times, you can kind of rebuild it and then use it again. And you actually get these 10 times that you can reuse it. But you still have the same concept of what they call it is to unseal the card.

So you can still, what you do is you put money in until you get to a certain point. It all goes into one address. And then you get to the point where you want to unseal it and then you basically want to sweep all of those funds into your wallet.

So that's the effect of sort of smash and then you can recreate a new address on it and do the same thing again. - So are there any other updates that I've missed or anything that you're working on at the moment that you're particularly excited about?

- So, you know, one of the biggest kind of updates in this most recent release was to effectively rebuild behind the scenes, the library that Sparrow uses to talk to Bitcoin Core, right? So for those people that aren't using an Electrum server who are, for example, running Bitcoin Core on their laptop and they then connect Sparrow to it,

which is a, I think, a valuable kind of cohort, if you will. The current mechanism that Sparrow is using prior to this release was to use a library called BWT, which in the background used what we call a legacy Bitcoin Core Wallet.

In other words, the Bitcoin Core Wallet that's been around in Bitcoin since day one. Now, around two years ago, there was a new kind of wallet that was introduced into Bitcoin Core, which we call a descriptor wallet and is based as it suggests on output descriptor.

And that wallet is kind of the wallet of the future. I'm not saying that Bitcoin Core is going to remove the old wallet anytime soon. I don't think that they are, but I do think that the descriptor wallets are going to be the correct and best way to do things going forward.

So I really wanted to get Sparrow to use those. And as a result, I kind of built from the ground up this sort of layer that BWT has been providing to date. So it's an entire kind of translation mechanism to basically give a Bitcoin Core Wallet and Electrum server front-end.

Kind of just puts this facade on top of it. And that was quite a bit of work, but it has the big advantage that we can now support Taproot wallets on Bitcoin Core, which we couldn't do previously because Taproot and legacy Bitcoin Core wallets just don't work at all together.

So that for me was, in terms of the background work, one of the biggest pieces, kind of future-proofing Sparrow in terms of that particular way of being able to connect to a node. And for me, that's an important kind of work to do, even though it's not perhaps the thing that is visually all that interesting.

That's actually where a lot of the work goes because you really want to make sure that that part of the wallet is very solid. - And obviously you're very keen on multi-sick. We've talked previously about why.

To my understanding, Taproot is very useful for people who are going to use multi-sick. You don't want to be the only person using it because you stand out. So everyone maybe kind of waits a while.

You want to be hiding in a crowd kind of idea. - Yeah, that is true to a certain extent. So every address in Taproot looks the same. So multi-sick address looks like a normal single-sick address, which is not true for segment, segment.

So there is actually a lot of privacy benefits to moving to Taproot, particularly when it comes to the multi-sick case. However, that said, until last week, the use of Taproot was really quite low indeed.

So we actually are in a situation where no one was really using Taproot for much at all, and you would stand up regardless of whether you were using single-sick or multi-sick. And I would still say that's pretty much the case today, although we are now seeing obviously a lot more block space being taken up by Taproot with ordinals.

So I think that the biggest thing holding multi-sick on Taproot back has actually just been ensuring that we have a good cryptographic spec. And that spec is, they are more than one, but the most commonly referred to one is called music two.

And that is really only getting finalized now. I think it's sort of, I believe it is still in draft, but I think that that draft period is coming towards a close. And I think we are likely to start seeing the first lightning implementations move towards multi-sick, sorry, move towards Taproot, channel opens and closes soon,

which should start to give us a sort of a non-set that is of a decent size. But I don't know of any other wallets that have actually built Taproot, multi-sick in yet, simply because this music two is all very new.

Now the one big downside of music two is that you have to do this two-step process. So you have to basically provide this random use once number. And then you kind of have to do that with all of the different signers.

And then once that's done, you then have to go around and sign again with all of those different signers. So for example, if you have a different series of safety deposit boxes, you're gonna have to go and visit them all twice in order to get that transaction signed.

And that's, I think, quite a big downside for many people because after all, one of the best advantages to multi-sick is the fact that you have this idea of being able to geographically separate your seats.

So I don't think it's a slam dunk. I do think that there's a privacy benefit to be had, but I don't think that it's an obvious choice that everyone's just gonna say, right, native, segment, multi-sig is out.

We need to move on to the new thing out. I think that we're gonna have to feel our way in there and find the use cases where it makes sense. - All Taproot transactions look the same. Presumably you were saying about lightning.

If you have channel open encloses, that then won't look any different to any other transaction, is that right? - Yeah, so basically a channel open and close is a two of two multi-sick. And as I was saying earlier, every multi-sig kind of address that you create looks the same.

So there is a degree to which, so long as we are following the sort of key path, the default path, the spins should also be relatively, their ship should be hard to tell one from the other.

So I think that we are hopefully gonna see a bigger and non-set soon, but until it happens, I think people should be cautious. And many people come on the sort of Sparrow support group and wanna use Taproot, and the best advice right now is just don't.

You're gonna stand out generally the hardware while it's support, it's coming, but it's still somewhat patchy. It's just even years after it was introduced to Mainnet, it's still coming, it's still being built out.

And I wouldn't advise it yet for those trying to do self custody of their own funds. - Yeah, fair enough. I remember when Taproot was being discussed and there was a lot of talk on Twitter and everyone was talking about the pros and cons and mainly it was the pros.

I'd never heard of ordinals or even knew that that was even a possibility. I never heard anyone talk about it and maybe that's just me missing it, but I can't remember that being discussed at all.

And now there's a load of people who are winching about it. To me, it seems like, well, as long as someone's paying a fee and they're getting into a block, then it's valid and who really cares.

Have you got any thoughts around it or do you just literally, you couldn't care less? - Yeah, I mean, there really is no alternative at this point. It's not like any change can be made or can practically be made, I should say.

So, you know, I think it's one of those things which is currently, you know, in the ascendant phase of its hype cycle. Certainly, Sparrow has been recommended as the wallet that people use to receive ordinals onto.

I actually don't, I haven't, you know, beyond reading a little bit about them. I haven't done deep kind of research into them. So I'm no expert. I must say that at the start. But I'm kind of of the view that, as you say, you know, people are paying the fee, you know, do I think that it promotes what Sparrow is about,

financial self self, rent, rent, identity? No, you know, I don't have a particular interest in it because it doesn't cater towards what I'm interested in using Bitcoin for. But, you know, what I use it for and what others use it for is, you know, they can be different, different things.

So I'm not planning to spend a whole bit of time worrying about it, thinking about it, building Sparrow for it. It's just something for someone else as I see it today that may change, but I don't think it will.

- Yeah, most of what I've seen has just been people flapping around and just causing drama, basically, it seems. But one person who's normally very level-headed was talking to me about it.

So the only thing that they're concerned about is the fact that it could be a way to attack Bitcoin or Bitcoiners, because effectively, if you're storing data, if you're running a node and something on there, like something disgusting that you'd never want on there is stored, can you be attacked more easily

than you would be if it was just a normal transaction? And that was one thing where I was thinking, mmm, probably, but then at the same time, it's like anything that people can attack or governments can attack Bitcoiners with is gonna be done anyway.

So, I don't know. I kind of think it probably is a bit of a nothing. - Yeah, I mean, I think that we've got, I can't actually cite the examples now, but I think we've had quite a bit of prior history on people storing things on the blockchain that are dubious in some way or either to someone else.

- I just think we've kind of crossed that bridge years ago and it's not really a new one. So, that doesn't really worry me so much, but who knows, how the greater people perceive things can often have an effect.

We certainly are in a state now where everyone seems to be up and on about something which could have been done years ago. And, you know, kind of making the wrong inferences like Taproot caused this when it actually was caused by the prior soft fork.

You know, I just think, you know, ultimately it is what it is. If Bitcoin succeeds, this kind of usage will probably get priced out. And that's what we all want. So, you know, it's important not to focus too much on the here and now and more kind of look ahead to where we are likely to be going.

- And the other thing is not too long ago, people were jumping up and down, suggesting bringing in a tail emission and all this kind of stuff because they're saying, "Oh, well, we don't think as block subsidy goes down "that there's going to be enough fees for miners.

"And therefore, they're not going to be incentivized "to keep running and blah, blah, blah." And then it's like, "Oh, hold on, "here's this thing where people are willing to pay "for the block space, whether we think it's useful "or interesting or not, they're paying for it.

"So, which is it? "Are you worried about there not being enough transactions "or are you worried about there being too many transactions? "Are you just worried about fucking everything?" - Yeah, I mean, you know, Max, often when I see people get into these online spats, which I try to avoid because I think they just waste time,

but often I think that the basic fallacy or the mistake being made is that people just are not kind of taking the long view. They're just reacting to whatever is the hot thing today and using a lot of words to, you know, put around, round it without kind of saying, "Hey, we're just really early, guys.

"We're just super early. "We don't know how this is going to play out. "Maybe just chill, you know. "So far it's going all right. "Let's not try and scare up every possible drama "that we can think of ahead of it actually happening."

So yeah, that's my kind of general thought when I browse my Twitter feed is, you know, really, it's just really early. - Yeah, I would agree with you. And also, you're actually building stuff and doing stuff.

I think sometimes the people who are shouting loudest have fuck all to do with their lives and also it just gets engagement. And at the end of the day, that's what they care about rather than the truth.

So I guess that's the difference. Is there any stuff that outside of Sparrow that you are looking at and excited about within Bitcoin and development or even just generally open source software?

Are there any things that you've got your eye on at the moment? - You know, nothing dramatic that, you know, I think we kind of just keep going on and it's good to see people are, despite the bear mark market, people are getting their heads down.

It's good to see what it's keep coming out with new kind of ideas and features. I'm very excited to hopefully welcome some more Whirlpool clients soon. You know, I think that that might be going on in the next few sort of months.

And every additional Whirlpool client that we get just really increases the sort of entropy of the pool. You know, it just means we've got people coming from a different set of users, different backends.

You know, it just kind of hardens the entire thing. So I think that that's a really, you know, nice feature to have is just these new clients which come on and the Rust implementation of the Whirlpool client which was released a few weeks ago is a really great step for that.

Cause now we've got BDK which I believe is written in Rust and we have this, so we have the potential for people to kind of pull together different libraries to be able to build these great privacy tools.

And if you think about where we were just a few years ago, we've really moved a long way forward which gives me a lot of hope for where things are going. So I guess that those are the major things that I'm hopeful for.

- Excellent. Well, Greg, I want to take too much more of your time, your building and doing important things but it's always good to catch up with you and appreciate the work that you're doing and it's nice to finally be using your software.

So yeah, a big thank you from me and all the users, it's much appreciated. - Great, well, thanks for having me on, Max. Yeah, I hope you enjoy using Sparrow. You know, it's, yeah, I think if there's one thing that I hope Sparrow can achieve, it is educating beyond everything, just making people understand

what they're doing more, regardless of whether they use other wallets is, for me, one of my major goals and that's what I hope Sparrow will be known for, perhaps, about everything else. - Well, it definitely does that.

It's a really nice interface and it gives you so much information that others don't. So yeah, I think it's definitely doing that. I hope my annoying feedback on it isn't too frustrating but I have a special skill which is breaking software, breaking anything that I use and getting confused.

So if it's all right with you, as I come across things that I don't understand, I'll just ping you and annoy you. Just tell me to fuck off when it gets too annoying. - No, no, that's all good.

You know, I'm always trying to learn about how people use things and how they see things and what thoughts come into their mind when a new sort of UI element comes up. So all of that feedback is good.

So yeah, keep it coming. (laughing) - All right, well, thanks again and hopefully we'll catch up again soon. - Awesome, Max, thank you. - Thanks for listening. I really hope you enjoyed that and if you did, I'd really appreciate it if you could like, subscribe and share this podcast.

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