Mcf Episode
Date: May 11, 2019
Transcript By: Bryan Bishop
Media: https://youtu.be/0MnuvKybuo0?t=1463
Video MCF Short: https://youtu.be/SnfKIKL_Ghk
WP: The short was not about Craig Wright. It was not about him being a fraud, because he is not a fraud.
SM: We also have a store. I don’t think we’re ready to start shipping stuff yet, so inventory will remain zero. I’ll post a tweet when we’re ready to start selling stuff. We might have some t-shirts and some other stuff. But not the coins, which are limited edition.
WP: The coins are just for the conference here. If someone else at home wants to buy them, then they would have to find someone that was here and try to buy them.
CL: If we don’t sell them out here, we will destroy them.
WP: Yes, of course.
SM: We don’t have a way to sweep them yet, but Lawrence from Blockstream is working on it.
WP: The video is very long.
SM: The coins have a token on them. Right now there’s 2,000 coins. We have a reissuance token. Next conference we could do more. Technically you could trade them on an exchange, and one day they might be worth one billion dollars each. We have telegram sticker packs ready. We have one pack per each character.
CL: This is how we waste our time, making stickers.
WP: So why did it take so long to edit them? Half the time was Samson talking about Liquid or anything else. So we have to cut that part out before we upload it. This is why it’s taking so long now.
SM: I think the next one… Panda? Yeah. So you have a lot of emojis. I am going to use the Panda cryalot.
CL: Do we charge for this?
SM: No, it’s free.
CL: That’s a shame.
SM: Did you see all the characters?
CL: What are we talking about next?
SM: There’s one of pony and panda laughing.
CL: Laughing with Samson, probably.
SM: We can switch to the next video. I have an announcement for Pixelmatic, it’s my game company. Maybe some people haven’t heard about it yet. It’s the wifi sponsor. I saw someone tweeting that because our wifi password was tether2themoon, some guy was saying “see look, I told you guys” even though I don’t like tether.
WP: Isn’t that person Tim connected to R3? He’s a known troll.
SM: It was an obvious troll but this guy took the bait. Can you play the next video? Okay, this announcement is for Pixelmatic. We’re going to be doing a security token on Liquid. We’ve already kicked it off and started to raise funding. One of our backers is Heisenberg Capital. We have some other investors too like East Ventures. We will probably announce it soon. We have an MMORTS scifi space game. It’s like eve online meets real-time strategy. We made some big hires for this project. Jason Lee is our chief creative officer, prevoiusly lead designer on Age of Empires and we plucked him away from Microsoft. We also hired someone from the original Homeworld team. Okay, someone plays it. It’s a classic space battle game. These guys have joined Pixelmatic and we’re ready to start cranking it out. We’ve closed about $3 million and we want to close 16-27m by the end of the year.
WP: Does it seem like…
CL: It does seem like that, but the game looks pretty cool.
SM: It is. Okay, that’s it for my announcement. So what do you want to do now? Audience questions?
WP: I want to talk about the Tim Swanson tweet. He was talking about a “multitude of bullies speaking at MCC2019”. I don’t know who the bullies are. Yeah, you’re the biggest bully of them all. Tim was saying the shilling for tether was off the scale. Okay, let’s go out for the audience questions, I just wanted to point out how stupid Tim was.
SM: How did he find that? It’s supposed to be secret.
FP: Well, whalepanda.
WP: We have two runners and two mics if anyone wants to ask questions. Please don’t ask about liquid or anything else.
SM: You can ask about liquid.
CL: Ask us anything.
SM: We’re doing Q&A because we didn’t really plan a show.
Q: What’s your best price pump theory for the recent price pump? Let’s hear your theories. Let’s hear your thoughts on your theory for the recent price pump.
WP: So, why did the price pump?
FP: The binance hacker wanted more money in the hot wallet, so he pumped the price. He needed more money in the hot wallet for him to steal.
WP: We brought a bull today, so tomorrow we will sacrifice the bull and then afterwards we will have a big barbeque. It was Novak’s idea actually. The price went up because there’s more demand.
CL: More buyers than sellers?
WP: No, there are always equal amounts of buyers and sellers.
SM: This is a complex theory here.. We’re starting to price in the halvening. Like the last one, the price started to go up half a year before. People expected it to pop, but then it didn’t really pop. I always thought bitcoin is undervalued right now. I think we should be at about $10k. I’m not that surprised that we’re moving back up. I don’t want to make predictions, but I think it will go back up.
WP: No predictions?
SM: I mean no number predictions. I think it’s going up, though.
CL: The binance hack is been there done that and it doesn’t really impact anything.
WP: In a bull market, bad news doesn’t really impact the price that much.
CL: So we’re in a bull market?
WP: I would say so, at this point.
SM: Thanks for asking the question.
WP: You always get those questions and then you have to avoid answering directly, because you don’t want to make a prediction. If you make an explicit prediction, people can use it against you.
Q: This question is for Samson. Will there be any interaction between Liquid and the lightning network, if there isn’t yet?
SM: That’s a good question. Will there be any interaction between Liquid and the lightning network? Yeah, I don’t know if I should talk about that. There will be. Liquid is based on bitcoin. So technically it is possible to do a lightning network on top of any Liquid asset. I think we’re preparing a demo this week at one of the tech sessions at Consensus to show it. But yes, there can be.
WP: So apparently the audience hears Riccardo fine. But we don’t.
CL: There’s no speakers pointing towards us.
WP: When you start talking about Liquid or browsing through…
SM: By the way, we have a lot of new members in Liquid and integrations.
CL: Good for you, Samson.
FP: Pretty sweet.
WP: How will we do the draw tomorrow for the lambos?
SM: We will pull from a hat.
WP: Here on stage? How will Riccardo do it? Pick a random number between 1 and 800.
FP: 73.
SM: What did he say?
WP: 73.
SM: Any other questions?
Q: What can you tell us about the development staff of litecoin and the challenges of maintaining a strong development team?
WP: Does litecoin have any developers, or do they just copy-paste from bitcoin?
SM: Oh, burn.
CL: It’s a challenge to get developers interested in working on litecoin. But we have a good team. We have most of the– it’s pretty clear that we get most of our stuff from bitcoin. We forked bitcoin, and everything upstream, we can just deploy to litecoin. So we get a lot from bitcoin. We’re also working on other things like the mimblewimble sidechain, not sidechain but extension blocks. We’re trying to work on that and see what happens. So yeah, stay tuned and see what happens in the next year. The good thing about litecoin is that we get all the bitcoin stuff for free. Bitcoin has the best developers working on it, and we get it for free. It’s a good thing. Does that answer your question? I can’t tell who actually asked me the question.
Q: This question is for Charlie. Last year you tweeted that if I send you 10 ETH, you would send me 100 back. And you never did. I’m here to collect that. No, actually, for Samson, based on your gaming reveal, any thoughts about blockchain gaming in general or projects like engine coin and whether that could be a catalyst for the industry?
SM: I don’t like that. I like the integration of crypto into games. For the pixelmatic game, we’re using a participation token generated by in-game events. MMO games, if you’re familiar with MMO games, people like to manage their currencies if they have a guild, clan or a corporation in Eve. You manage funds and collect them. Our utility token will be done in Liquid. You can use a multisig wallet for your funds. People have infiltrated a guild at Eve, and played for like a year, just to steal their guild funds. There’s a lot of things we can do to bring cryptocurrency to games. We can also open the doors to more users by integrating with games. The established players, I mean World of Warcraft won’t add it. But because I’m in the space and I see the potential, someone was asking about Lightning on Liquid. The utility token on Infinite Fleet can be powered through lightning so we can have instant free transactions down the road. But it’s also a way to get more people into crypto. People can play the game, earn the token, and sell it somewhere. It’s transportable.
CL: It’s not about putting every action on the blockchain. A lot of games are doing that, but it makes no sense and it doesn’t scale.
SM: Right. If you put your items on the blockchain, and the company goes away, you don’t have that sword or armor anymore.
CL: So it’s decentralized, but it depends on the players to give it value.
SM: Exactly. Does that give you the answer? Okay.
CL: Any other questions?
Q: … changing the protocol…
WP: Did you get any of that?
FP: I didn’t hear anything.
WP: You need to use the microphone.
SM: We’re having some technical difficulties.
WP: Last year we prepared and it turned out so much better. We should have prepared an agenda for the show.
SM: Good to go?
Q: My question is for fluffypony. Obviously monero doesn’t have the capability for cross-chain atomic swaps (x-cats). Is that an important step in the future?
FP: Can you repeat the question?
Q: Do you see cross-chain atomic swaps as a big step forward for monero?
FP: A lot of the functionality needed for cross-chain atomic swaps is the same functionality needed for liveling. So I kind of, I think we’re probably going to end up, I can’t speak for others, but my expectation is that the developers will end up building the functionality needed for both atomic swaps and liveling. I think it’s important for monero to be able to handle cross-chain atomic swaps to allow users of cryptocurrency that aren’t currently private, to be able to trivially and at a low cost be able to move in and out of monero and thus severing on-chain links.
SM: Does that answer your question? Okay, I didn’t hear anything. Next? Any other questions? How are we doing for time?
WP: Uhhh. Fine. So apparently, it’s been 30 days since hodlnaut disappeared from twitter.
FP: We miss him, and we want him to come back to twitter.
SM: You’re assuming he’s following the show.
FP: Obviously.
SM: I have heard he’s doing okay. Nobody knows who he is.
CL: Well, if he wants to reach out to us, we’re open to that. It’s an open offer. That was his only account. That was his only presence. If he came out there’s no way to prove himself. Send me a message and we can help if you want to talk to the community.
SM: The fundraiser went pretty well, I think it crossed $32k.
WP: Yes, I think so.
SM: You?
WP: No.
CL: Me either.
FP: A bit. And all of them didn’t even reply.
WP: Maybe we shouldn’t give him any attention at all. Any other questions?
Q: My question for Charlie is- do you see litecoin having its own use case separate from bitcoin?
WP: Like smart contracts?
CL: We’re trying something different with mimblewimble. We’re trying to make litecoin more fungible. That’s definitely going to be different from bitcoin. In the end, the idea is still sound money. We’re not creating paypal 2.0. In Litecoin’s case, we’re creating silver 2.0 to gold’s bitcoin’s 2.0. We still want to be money that is censorship resistant and immutable and that part is similar to bitcoin. Even for bitcoin, we want money to be more fungible. You want to be able to spend it without, the part–the recipient being able to discriminate between payments you are sending them versus someone else sending or the different outputs you’re using. We’re interested in seeing if that can work out on litecoin.
WP: Riccardo, are you having fun? How is it being a robot at a conference?
FP: Being a robot at a conference is an interesting experience. It sucks because nobody can give me a hug or give me a sticker or give me a high-five. It sucks that nobody can hear me. At least they put it up to the speaker where it’s loud. But it’s pretty cool that I can sit half-way across the planet and move around and walk into chairs with a robot.
WP: Tomorrow we’re going to put you in a dark closet and see how long it takes you to get out.
FP: We can try that, if that’s what you’re into.
WP: Is there a GPS on this so that your handler can find you?
FP: My Blockstream handler.
CL: The best part about fluffypony being in the robot is that you can kick him and he can’t do anything about it.
FP: You’re so mean, Charlie.
CL: That’s a nice watch, I like your watch.
FP: Thank you.
SM: He’s a big watch.
FP: It’s inspired by flavor flave.
CL: Do we have a question over there?
SM: Do we?
Q: Sometimes enthusiasm is hard to contain. There’s rarely a contrarian opinion. Is there something that you wake up in the middle of the night with a fear that maybe this enthusiasm is more than it should be? Does that make sense?
WP: In a way, yes. I was worried about the price, not now, but when the price was around $200. A lot of us were thinking, this could go to zero. We invested a lot of time, money and effort in it. At that point, I felt and I know other people like me mostly strangers felt like this could still go to zero. At the moment, I don’t have that feeling anymore.
CL: That’s like the difference between the last bear market and this one. When it went from $1000 to $200, a lot of people thought that was it, it’s a failed project.
WP: Yep.
CL: It’s a sign that this is– we’ve actually made it. We’re not going to die anymore.
WP: We’ve made it, guys. ((applause))
SM: So we wake up and do we think it’s too crazy?
CL: Anything bad about it.
SM: I don’t see anything bad about bitcoin. I’ve seen a lot of bad stuff about blockchain. Everyone wants to find an interesting way to use blockchain, and I think that’s bad. But I think bitcoin can go and become much more valuable, and it could probably reach $200k/coin just because it’s a superior store of value. If we look at the property market or gold, people are using property as a store of value and this is really bad because it causes housing issues and there’s no places for people to rent or live in.
WP: One thing that I do want to mention as an example for you is that some people are saying with lightning there’s a lot of hype about it happening and building. But lightning is not going to solve everything tomorrow. We just have to be realistic about your expectations and about the goals. A lot of the scammers are the opposite, they claim that they have fixed everything right now and thy are superior. But what’s great about this community is that they are more realistic about these things.
CL: What concerns me is that we haven’t solved the problem of protecting funds. Exchanges are getting hacked. Just recently Binance got hacked.
WP: Are you saying Binance hacked themselves to promote themselves?
CL: I didn’t say that. It’s still a big problem, exchanges getting hacked. The great thing about bitcoin is that you can be your own bank. And that’s hard.
SM: That’s why you should use Liquid so that you can take your funds off of exchanges.
CL: That doesn’t help.
SM: That helps a little.
CL: People keep coins on exchanges because they can’t do anything else.
SM: It will disincentivize people from staying on exchanges. Alp is trying to tell us something.
Alp: More questions over here.
Q: In terms of old people talking about we need to produce a bill to make bitcoin illegal and it’s a threat to NY federal reserve and so such. Do you have any predictions for the rest of 2019 in terms of any kind of legislation or regulation that might come down specifically in the US or could you generalize this across the world?
SM: You’re the American.
CL: I don’t think bitcoin will be banned in the US. I think we’re past that point.
WP: I think this fits nicely for tomorrow. We’re not regulatory experts. But tomorrow we have a panel.
CL: Of regulatory experts?
WP: Exactly. So go tomorrow.
CL: Come tomorrow.
WP: You will get a good answer there, and from the 3.5 of us, maybe.
SM: Next question? Yeah, Frank?
Q: This is directed towards Charlie. You said you hold bitcoin, litecoin, nano, and decred. So bitcoin is gold, litecoin is silver, then how do you see- because litecoin might be a better silver than litecoin?
CL: People keep asking me what coins I hold. I play around with coins, right? I assume everyone here does also. I played around with nano, it seems interesting. Please don’t say that because Charlie holds nano, it’s going up. Please don’t do that. Coindesk doesn’t do that, but many other journalists do. They just take it the wrong way. No, I don’t think nano is going to replace litecoin. The thing with nano is that it has zero fees.
SM: We’re not allowed to shill altcoins at this conference.
CL: There’s tradeoffs. Many coins say they are faster than bitcoin and this and this better than litecoin. But nothing is strictly better than bitcoin or litecoin. Litecoin has tradeoffs against bitcoin. It’s faster, but it’s less secure. The security on it pales in comparison to bitcoin. If you’re willing to accept tradeoffs, then that’s fine. Often the tradeoff is more centralization. This might be perfectly fine for you to say this is a good enough tradeoff. For example, Ripple, the transaction is like a second and it confirms a second and you’re willing to tradeoff the centralization then that’s fine just use ripple for a lot of things.
WP: That’s another…
CL: For me, I care about what cryptocurrency made possible is censorship resistance and immutability and that’s something you need decentralization for. I’m not willing to make that tradeoff. I’m not here for paypal 2.0, I’m here for a better form of money.
WP: We’ve tried so hard to keep scamcoins out of this. We had so many offers from ICOs. I guess we can do one more question. Here in the front, last question.
SM: Two more questions.
WP: Two more questions and then yeah.
Q: Thinking about bitcoin, price has done what price does over time. We all spend a lot of time trying to express valuation, and we look at user adoption. What metrics do you find to be your favorite? What parameters on network growth and user adoption do you find meaningful?
WP: That’s a difficult question. If you’re going to focus on one metric, it’s going to be manipulated. If you take transactions, they are up, but are transactions up because of users or because of spam? It’s difficult to figure out real usage and what’s inflated or manipulated statistics.
FP: I tend to focus on developer metrics. The number of new developers working on bitcoin. It’s not just bitcoin which is all software, but also wallets and lightning and things like that. The thing that is very telling for me is that I am more interested in …..
WP: It’s reconnecting.
SM: I’ll answer while he’s reconnecting. I think value transacted per second is an interesting measurement that people don’t talk about. A lot of people talk about transaction volume or transactions per second. But that doesn’t matter in a settlement network. You have to wait for confirmations and settlement. A year ago, bitcoin is the only network that moves thousands of dollars per second. It doesn’t matter if a coin has a million transactions per second if it’s worthless, because you’re still not really moving money or value around and letting people transfer value. For bitcoin, 20% of a block, 10-15% are omni transactions… there’s a lot of garbage transactions. You have to look at what’s actually valuable. A media outlet criticized liquid. It said not a lot of transactions so not a lot of adoption.
WP: You have to check with a merchant like bitrefill.
SM: You can do the math yourself. How much money is being moved in a day?
WP: Riccardo, you were talking before you started echoing?
FP: Yeah, the only thing I want to say about developer metrics is that they can be gamed quite easily. I’m cautious about it. But if you take a look at Bitcoin Core in particular, Bitcoin pull requests are not merged rapidly. It’s not developer metrics like the number of new lines of code that are merged, it’s more like are people being attracted to work on the ecosystem as developers. I find that – is very top-down.
SM: Does that answer your question?
CL: People were asking, which metric to look at to see if bitcoin should be valued at a certain price. I think about it as another way. The price is a really good metric. The market cap of bitcoin is a metric of how successful it is. If it’s a store of value, then the amount of money stored in bitcoin is how much people are willing to put their wealth in bitcoin and keep it there because that’s the asset class they want to store the value in. Market cap is the best metric for how successful bitcoin is. But it’s weird because people are trying to figure out what the market cap is.
SM: The problem with market cap is all the altcoins with inflated market caps.
CL: Well, liquidity also matters. It’s market cap and liquidity.
WP: So it’s a combination of things.
SM: I think it’s safe to look at market cap for bitcoin, but not other things. Next and last question?
Q: Have any of you had a chance to review the flood XMR paper?
SM: That’s a Riccardo question.
FP: Yes.
CL: He said yes.
Q: Can you talk about the ramifications?
FP: Sure. The flood XMR paper is an extension of an attack that the Monero Research Lab detailed in their first paper in 2014 which basically says, if you own like 70-80% of the outputs on the network then you will be able to figure out with reasonable odds of certainty which is the true side of the ring signature. The problem with flood XMR is that they made a bunch of assumptions and they said it’s trivial to own transactions on the network because outputs are super cheap, so you can create billions of outputs. They had a bunch of things wrong. The entire hypothesis was based on creating transactions with 100 outputs. But monero limits outputs to 16 outputs.